Case Digest: Eastern Shipping v. Court of Appeals, 196 SCRA 570, G.R. No. 94151

Eastern Shipping v. Court of Appeals, 196 SCRA 570, G.R. No. 94151, April 30, 1991

Subject: Transportation Law

FACTS

On September 4, 1978, thirteen coils of uncoated 7-wire stress relieved wire strand for prestressed concrete were shipped on board the vessel "Japri Venture," owned and operated by the defendant Eastern Shipping Lines, Inc., at Kobe, Japan, for delivery to Stresstek Post-Tensioning Phils., Inc. in Manila.

On September 16, 1978, the carrying vessel arrived in Manila and discharged the cargo to the custody of the defendant E. Razon, Inc., from whom the consignee's customs broker received it for delivery to the consignee's warehouse.

The plaintiff indemnified the consignee for damage and loss to the insured cargo, whereupon the former was subrogated for the latter. The plaintiff now seeks to recover from the defendants what it has indemnified the consignee.

RTC dismissed the complaint. Plaintiff appealed their cause to the CA. CA set aside the decision of RTC and ordered the appellees to pay the petitioner. Eastern Shipping Lines, Inc. to assume 8/13 thereof, and E. Razon, Inc. to assume 5/13 thereof. Only Eastern Shipping files a review for certiorari to SC.

ISSUE

Whether or not Eastern Shipping Lines exercised extraordinary diligence and is not liable for the damage to the cargo.

RULING

No, Eastern Shipping Lines was not able to prove that they had exercised extraordinary diligence with the cargo.

Under the law, common carriers are bound to observe "extra-ordinary vigilance over goods…according to all circumstances of each case". If the goods are lost, destroyed or deteriorated, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as required in article 1733.

In this case, while it is true the cargo was delivered to the arrastre operator in apparent good order condition, it is also undisputed that while en route from Kobe to Manila, the vessel encountered "very rough seas and stormy weather”. SC held that the heavy seas and rains referred to in the master's report were not caso fortuito but normal occurrences that an ocean-going vessel, particularly in the month of September which, in our area, is a month of rains and heavy seas would encounter as a matter of routine. They are not unforeseen nor unforeseeable. Rainwater (not sea water) found its way into the holds of the Jupri Venture is a clear indication that care, and foresight did not attend the closing of the ship's hatches so that rainwater would not find its way into the cargo holds of the ship. The carrier has failed to establish any caso fortuito, the presumption by law of fault or negligence on the part of the carrier applies; and the carrier must present evidence that it has observed the extraordinary diligence required by Article 1733 of the Civil Code in order to escape liability for damage or destruction to the goods that it had admittedly carried in this case. No such evidence exists of record. Thus, the carrier cannot escape liability.