DELGADO BROTHERS, INC. V. HOME INSURANCE, INC., A.
A. Shipper and/or consignee filed its claim with petitioner for said loss
1 SCRA 854/ March 27, 1961/ Barrera, J./ ANCILLARY CONTRACTS
VISITACION, ERIKA
NATURE An appeal by certiorari to review the decision of the Court of
Appeals
PETITIONERS DELGADO BROTHERS, INC.
RESPONDENTS HOME INSURANCE, INC.,
SUMMARY. Victor Bijou & Co shipped at New York for Manila aboard the vessel
SS Leoville and consigned to Judy Philippines a shipment of 1 case of linen
handkerchiefs and 2 cases cotton piece goods for which the New York agent of
the vessel, Barber Steamship Lines, issued a Bill of Lading insured with Home
Insurance.
The shipment was in good order however upon reaching the Port of Manila, the
linen handkerchiefs were in bad order, and with shortage to the prejudice, loss,
and damage of shipper and or consignee. Thus, Home Insurance filed against
the Delgado Brothers (contractor) for the said loss. Home Insurance paid the
amount and was subrogated to the shipper’s and/or consginee’s rights and
interests. However, Delgado Brothers refused to pay. Petitioner claims that the
CA erred in not dismissing respondent's complaint on the specific ground that it
(Court of First Instance) had no jurisdiction over the subject matter of the action,
the same not being an admiralty case, and the amount sought to be recovered
falls within the exclusive original jurisdiction of the Municipal Court of Manila.
DOCTRINE.
In case of controversy involving both maritime and nonmaritime subject matter,
where the principal matter involved belongs to the jurisdiction of a court of
common law or of equity, admiralty will not take cognizance of incidental
maritime matters connected therewith but will relegate the whole controversy to
the appropriate tribunal
FACTS.
1. February: Victor Bijou & Co. shipped at New York for Manila aboard the
vessel S.S. Leoville and consigned to the Judy Philippines, Inc. of
Manila, a shipment of 1 case Linen Handkerchiefs and 2 cases cotton
piece goods, for which, the New York agent of said vessel, the Barber
Steamship Lines, Inc., issued Bill of Lading No. 119 shipment as insured
with Home Insurance, Inc. by the shipper and/or consignee
2. That said shipment as insured with herein respondent by the shipper
and/or consignee; that said vessel arrived at the Port of Manila on March
30, 1955 and, thereafter, said shipment was unloaded complete and
in good order from said vessel by petitioner
3. March: Vessel arrived at the Port of Manila and delivered 1 case of
Linen Handkerchiefs in bad order, with a shortage of 503 yards of
Linen Print Handkerchiefs, to the prejudice, loss and damage of
shipper and or consignee in the sum of P1,287.20 so they filed a claim
against Home Insurance Inc.
4. Home Insurance Inc. filed against contractor Delgado Brothers Inc.
B. Thereafter, respondent paid the amount to the shipper and\or
consignee. The former was subrogated to the shipper's and/or
consignee's rights and interests.
C. That notwithstanding respondent's claim against petitioner, the latter
failed and refused to pay the shipper and/or consignee
Trial Court: DISMISSED the case and ABSOLVED petitioner from liability
Since no claim was filed within the 15-day period from the date of the arrival of
the goods before they could file a suit in the court of proper jurisdiction within 1
year from the date of said arrival at the Port of Manila, it is completely relieved
and released of any and all liability for loss or damage under the law and in
accordance with the pertinent provisions of the management Contract with the
Bureau of Customs, covering the operation of the Arrastre Service
CA: REVERSED because of lack of jurisdiction of CFI, it being a maritime
contract should be handled by the Municipal Court
ISSUES & RATIO.
WON the case has prescribed according to maritime law (arrastre being a
maritime case)? NO
In case of controversy involving both maritime and nonmaritime subject matter,
where the principal matter involved belongs to the jurisdiction of a court of
common law or of equity, admiralty will not take cognizance of incidental
maritime matters connected therewith but will relegate the whole
controversy to the appropriate tribunal
Petitioner's functions as arrastre operator are
(1) to receive, handle, care for, and deliver all merchandise imported and
exported, upon or passing over Government-owned wharves and piers in the
Port of Manila
(2) as well as to record or check all merchandise which may be delivered to
said port at shipside, and in general
(3) to furnish light and water services and other incidental services in order
to undertake its arrastre service.
Note that there is nothing in those functions which relate to the trade and
business of navigation nor to the use or operation of vessels
Both as to the nature of the functions and the place of their performance (upon
wharves and piers shipside), Brother's services are clearly not maritime but
arrastre services.
To give admiralty jurisdiction over a contract as maritime – such contract
must relate to the (1) trade and business of the sea; (2) it must be essentially
and fully maritime in its character; (3) it must provide for maritime services,
maritime transactions, or maritime casualties.
Delgado Brothers, Inc. has nothing to do with the loading or unloading of cargoes
to and from the ships. Its operation on and its responsibility for the merchandise
and goods begins from the time they are placed upon the wharves or piers or
delivered along sides of ships

Court of First Instance of Manila has jurisdiction in cases where suit is brought
directly against the carrier or shipowner.

DECISION.
WHEREFORE, the decision of the Court of Appeals appealed from is hereby
reversed and set aside, and case dismissed, with costs against the respondent.
So ordered.

NOTES.
Issue: Multiplicity of Suits
Respondent cannot invoke the rule against multiplicity of suits, for the simple
reason that said rule has to be subservient to the superior requirement that the
court must have jurisdiction

ANCILLARY CONTRACTS
It must be noted that Art. 1732 makes no distinction between one whose principal
activity is the carrying of persons or goods or both and one who does such as a
sideline

An ancillary business is a sideline

CONSIGNEE
Person to whom the goods are to be delivered (May be the shipper himself as in
the case where the goods will be delivered to one of the branch offices or a third
person)