[transpo] [southern v ca]

8/22/2019 [Transpo] [Southern v CA]

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TRANSPORTATION |CASE DIGESTS

Southern Lines, Inc. v. CAJanuary 31, 1962

De Leon, J.

SUMMARY:The city of Iloilo bought rice from NARIC whichwas shipped through the Southern Lines, Inc. Iloilo paid forthe entire shipping cost. When the goods arrived in Iloilo,there was shortage in the number of sacks, hence, Iloilofiled a case for the recovery of the amount representingthe value of the shortage of the shipment of rice. The CFIand CA absolved NARIC and ordered Southern to pay. Oneof the defenses of Southern was that it was exempt fromliability because the shortage was on account of the badcondition of the sacks. The SC affirmed the lower courtsand held southern liable.

DOCTRINE: if the fact of improper packing is known to thecarrier or his servants, or apparent upon ordinary

observation, but it accepts the goods notwithstanding such

condition, it is not relieved of liability for loss or injury

resulting thereform.

FACTS:- The City of Iloilo requisitioned for rice from the

National Rice and Corn Corporation (hereafter

referred to as NARIC) in Manila

- NARIC, pursuant to the order, shipped the rice

consigned to the City of Iloilo on board the SS

"General Wright" belonging to the Southern Lines,

Inc.

o Total no. of sacks - 1,726

o Total weight 129, 450 kilos

o Cost of shipment paid by Iloilo P63,115.50

- When Iloilo received the rice, it noted at the foot of

the bill of lading that it received only 1, 685 sacks or

116, 131 kilos.

o Shortage: 41 sacks = 13, 319 kilos = P6,

486.35

o Iloilo filed a case before the CFI against NARIC

and Southern for the recovery of the amount

of P6, 486.35.

- CFI: absolved NARIC, Southern to pay P4,931.41

which is the difference between the sum of

P6,486.35 and P1,554.94 representing the latter's

counterclaim for handling and freight.

- CA affirmed

ISSUES: whether or not the defendant-carrier, the hereinpetitioner, is liable for the loss or shortage of the riceshippedRULING: Yes, Southern is liable.

RATIO:

Applicable Laws


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The Court applied arts. 3611 and 3622 of the Code of

Commerce and quoted Government v. Ynchausti and Co. in

its application:

Under the provisions of Article 361, the defendant-

carrier in order to free itself from liability, was onlyobliged to prove that the damages suffered by the

goods were "by virtue of the nature or defect of the

articles." Under the provisions of Article 362, the

plaintiff, in order to hold the defendant liable, was

obliged to prove that the damages to the goods by

virtue of their nature, occurred on account of its

negligence or because the defendant did not take

the precaution adopted by careful persons.

Southern not exempt from liability

1ART. 361. The merchandise shall be transported at the risk andventure of the shipper, if the contrary has not been expresslystipulated.

As a consequence, all the losses and deteriorations whichthe goods may suffer during the transportation by reason offortuitous event, force majeure, or the inherent nature and defectof the goods, shall be for the account and risk of the shipper.

Proof of these accidents is incumbent upon the carrier2ART. 362. Nevertheless, the carrier shall be liable for the lossesand damages resulting from the causes mentioned in thepreceding article if it is proved, as against him, that they arosethrough his negligence or by reason of his having failed to take the

precautions which usage his establisbed among careful persons,unless the shipper has committed fraud in the bill of lading,representing the goods to be of a kind or quality different fromwhat they really were.

If, notwithstanding the precautions referred to in thisarticle, the goods transported run the risk of being lost, on accountof their nature or by reason of unavoidable accident, there beingno time for their owners to dispose of them, the carrier mayproceed to sell them, placing them for this purpose at the disposalof the judicial authority or of the officials designated by specialprovisions.

Southern: claims exemption on liability on the ground that

he shortage in the shipment of rice was due to such factors

as the shrinkage, leakage or spillage of the rice on account

of the bad condition of the sacks at the time it received the

same and the negligence of the agents of respondent City of

Iloilo in receiving the shipment.

Court:

- if the fact of improper packing is known to the

carrier or his servants, or apparent upon ordinary

observation, but it accepts the goods

notwithstanding such condition, it is not relieved of

liability for loss or injury resulting thereform.

- According to the CA: Southern itself frankly admitted

that the strings that tied the bags of rice were

broken; some bags were with holes and plenty of rice

were spilled inside the hull of the boat, and that the

personnel of the boat collected no less than 26 sacks

of rice which they had distributed among

themselves.

- The shortage was due to Southerns negligence.

City of Iloilo not precluded from filing a claim

Southern: Invoking art. 366 of the code of commerce andciting 2 cases (Government v. Ynchausti & Co., Triton

Insurance Co. v. Jose) argues that the requirement that the

claim for damages must be made within 24 hours from

delivery is a condition precedent to the accrual of the right

of action to recover damages.

Court:


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- The 2 cases cited are not applicable to the case at

bar:

o In Ynchausti the plaintiff never presented

any claim before filing an action

o In Triton there was payment of

transportation charges which precludes the

presentation of any claim against the carrier.

- In the American case of ofHoye v. Pennsylvania

Railroad Co. it was stated that:

such a stipulation (referring to the stipulation in the

contract requiring the owner of goods to present

claim at a specified time) is more in the nature of a

limitation upon the owner's right to recovery, andthat the burden of proof is accordingly on the carrier

to show that the limitation was reasonable and in

proper form or within the time stated.

- Case at bar:

o Southern failed to plead this defense in its

answer to the complaint and is therefore

deemed waived.

o The present action is for the refund of theamount paid in excess and not for damages

or recovery of the shortage. Iloilo paid for the

entire value of 1726 sacks.

o The bill of lading does not limit the time for

filing an action for the refund of the money

paid in excess.

DISPOSITIVE: CA affirmed.

[transpo] [southern v ca]

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