Belgian Overseas Chartering and Shipping, N.V. vs. Phil. First Ins.

Co. G.R. No. 143133 June 5 2002

Facts:
CMC Trading A.G. shipped on board the MN Anangel Sky at Hamburg, Germany 242
coils of various Prime Cold Rolled Steel sheets for transportation to Manila
consigned to the Philippine Steel Trading Corporation. On July 28, 1990, MN Anangel
Sky arrived at the port of Manila and, within the subsequent days, discharged the
subject cargo. Four (4) coils were found to be in bad order B.O. Tally sheet No.
154974. Finding the four (4) coils in their damaged state to be unfit for the intended
purpose, the consignee Philippine Steel Trading Corporation declared the same as
total loss.
Despite receipt of a formal demand, Phil. First insurance refused to submit to the
consignees claim. Consequently, Belgian Overseas paid the consignee
P506,086.50, and was subrogated to the latters rights and causes of action against
defendants-appellees. Subsequently, plaintiff-appellant instituted this complaint for
recovery of the amount paid by them, to the consignee as insured.
Impugning the propriety of the suit against them, defendants-appellees imputed
that the damage and/or loss was due to pre-shipment damage, to the inherent
nature, vice or defect of the goods, or to perils, danger and accidents of the sea, or
to insufficiency of packing thereof, or to the act or omission of the shipper of the
goods or their representatives. In addition thereto, defendants-appellees argued
that their liability, if there be any, should not exceed the limitations of liability
provided for in the bill of lading and other pertinent laws. Finally, defendantsappellees averred that, in any event, they exercised due diligence and foresight
required by law to prevent any damage/loss to said shipment.
Issue: Whether or not petitioners have overcome the presumption of negligence of a
common carrier
Held:
No.
Petitioners contend that the presumption of fault imposed on common carriers
should not be applied on the basis of the lone testimony offered by private
respondent. The contention is untenable.
Well-settled is the rule that common carriers, from the nature of their business and
for reasons of public policy, are bound to observe extraordinary diligence and
vigilance with respect to the safety of the goods and the passengers they transport.
Thus, common carriers are required to render service with the greatest skill and
foresight and to use all reasonable means to ascertain the nature and

characteristics of the goods tendered for shipment, and to exercise due care in the
handling and stowage, including such methods as their nature requires. The
extraordinary responsibility lasts from the time the goods are unconditionally placed
in the possession of and received for transportation by the carrier until they are
delivered, actually or constructively, to the consignee or to the person who has a
right to receive them.
Owing to this high degree of diligence required of them, common carriers, as a
general rule, are presumed to have been at fault or negligent if the goods they
transported deteriorated or got lost or destroyed. That is, unless they prove that
they exercised extraordinary diligence in transporting the goods. In order to avoid
responsibility for any loss or damage, therefore, they have the burden of proving
that they observed such diligence.
However, the presumption of fault or negligence will not arise if the loss is due to
any of the following causes: (1) flood, storm, earthquake, lightning, or other natural
disaster or calamity; (2) an act of the public enemy in war, whether international or
civil; (3) an act or omission of the shipper or owner of the goods; (4) the character
of the goods or defects in the packing or the container; or (5) an order or act of
competent public authority. This is a closed list. If the cause of destruction, loss or
deterioration is other than the enumerated circumstances, then the carrier is liable
therefor.
Corollary to the foregoing, mere proof of delivery of the goods in good order to a
common carrier and of their arrival in bad order at their destination constitutes a
prima facie case of fault or negligence against the carrier. If no adequate
explanation is given as to how the deterioration, the loss or the destruction of the
goods happened, the transporter shall be held responsible.
That petitioners failed to rebut the prima facie presumption of negligence is
revealed in the case at bar by a review of the records and more so by the evidence
adduced by respondent

Rodolfo Ganzon vs Court of Appeals

Rodolfo Ganzon was the then mayor of Iloilo City. 10 complaints were filed against
him on grounds of misconduct and misfeasance of office. The Secretary of Local
Government issued several suspension orders against Ganzon based on the merits
of the complaints filed against him hence Ganzon was facing about 600 days of
suspension. Ganzon appealed the issue to the CA and the CA affirmed the
suspension order by the Secretary. Ganzon asserted that the 1987 Constitution does
not authorize the President nor any of his alter ego to suspend and remove local
officials; this is because the 1987 Constitution supports local autonomy and

strengthens the same. What was given by the present Constitution was mere
supervisory power.

ISSUE: Whether or not the Secretary of Local Government, as the Presidents alter
ego, can suspend and or remove local officials.

HELD: Yes. Ganzon is under the impression that the Constitution has left the
President mere supervisory powers, which supposedly excludes the power of
investigation, and denied her control, which allegedly embraces disciplinary
authority. It is a mistaken impression because legally, supervision is not
incompatible with disciplinary authority.

The SC had occasion to discuss the scope and extent of the power of supervision by
the President over local government officials in contrast to the power of control
given to him over executive officials of our government wherein it was emphasized
that the two terms, control and supervision, are two different things which differ one
from the other in meaning and extent. In administration law supervision means
overseeing or the power or authority of an officer to see that subordinate officers
perform their duties. If the latter fail or neglect to fulfill them the former may take
such action or step as prescribed by law to make them perform their duties.

Control, on the other hand, means the power of an officer to alter or modify or
nullify of set aside what a subordinate officer had done in the performance of his
duties and to substitute the judgment of the former for that of the latter. But from
this pronouncement it cannot be reasonably inferred that the power of supervision
of the President over local government officials does not include the power of
investigation when in his opinion the good of the public service so requires.

The Secretary of Local Government, as the alter ego of the president, in suspending
Ganzon is exercising a valid power. He however overstepped by imposing a 600 day
suspension.

MACAM vs. COURT OF APPEALS GR No. 125524; August 25, 1999

Thursday, January 29, 2009 Posted by Coffeeholic Writes
Labels: Case Digests, Commercial Law

Facts: Benito Macam, doing business under name Ben-Mac Enterprises, shipped on
board vessel Nen-Jiang, owned and operated by respondent China Ocean Shipping
Co. through local agent Wallem Philippines Shipping Inc., 3,500 boxes of watermelon
covered by Bill of Lading No. HKG 99012, and 1,611 boxes of fresh mangoes
covered by Bill of Lading No. HKG 99013. The shipment was bound for Hongkong
with PAKISTAN BANK as consignee and Great Prospect Company of Rowloon (GPC)
as notify party.

Upon arrival in Hongkong, shipment was delivered by respondent WALLEM directly

to GPC, not to PAKISTAN BANK and without the required bill of lading having been
surrendered. Subsequently, GPC failed to pay PAKISTAN BANK, such that the latter,
still in possession of original bill of lading, refused to pay petitioner thru SOLIDBANK.
Since SOLIDBANK already pre-paid the value of shipment, it demanded payment
from respondent WALLEM but was refused. MACAM constrained to return the
amount paid by SOLIDBANK and demanded payment from WALLEM but to no avail.

WALLEM submitted in evidence a telex dated 5 April 1989 as basis for delivering the
cargoes to GPC without the bills of lading and bank guarantee. The telex instructed
delivery of various shipments to the respective consignees without need of
presenting the bill of lading and bank guarantee per the respective shippers
request since for prepaid shipt ofrt charges already fully paid. MACAM, however,
argued that, assuming there was such an instruction, the consignee referred to was
PAKISTAN BANK and not GPC.

The RTC ruled for MACAM and ordered value of shipment. CA reversed RTCs
decision.

Issue: Are the respondents liable to the petitioner for releasing the goods to GPC
without the bills of lading or bank guarantee?

Held: It is a standard maritime practice when immediate delivery is of the essence,

for shipper to request or instruct the carrier to deliver the goods to the buyer upon
arrival at the port of destination without requiring presentation of bill of lading as
that usually takes time. Thus, taking into account that subject shipment consisted of
perishable goods and SOLIDBANK pre-paid the full amount of value thereof, it is not
hard to believe the claim of respondent WALLEM that petitioner indeed requested
the release of the goods to GPC without presentation of the bills of lading and bank
guarantee.

To implement the said telex instruction, the delivery of the shipment must be to
GPC, the notify party or real importer/buyer of the goods and not the PAKISTANI
BANK since the latter can very well present the original Bills of Lading in its
possession. Likewise, if it were the PAKISTANI BANK to whom the cargoes were to be
strictly delivered, it will no longer be proper to require a bank guarantee as a
substitute for the Bill of Lading. To construe otherwise will render meaningless the
telex instruction. After all, the cargoes consist of perishable fresh fruits and
immediate delivery thereof the buyer/importer is essentially a factor to reckon with.

We emphasize that the extraordinary responsibility of the common carriers