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Case Digest: Caltex vs. Sulpicio Lines, G.R. No. 131166

 

Caltex vs. Sulpicio Lines, 315 SCRA 709, G.R. No. 131166, September 30, 1999

Subject: Transportation Law


FACTS

MT Vector, a tramping motor tanker owned and operated by Vector Shipping Corporation, left the port of Limay, Bataan carrying petroleum products of Caltex Philippines, Inc. (petitioner) en route to Masbate by a charter contract. While MV Doña Paz, a passenger and cargo vessel owned and operated by Sulpicio Lines, left the port of Tacloban headed for Manila.

On December 20, 1987, the two vessels collided in the open sea. Among those who perished were public school teacher Sebastian Cañezal (47 years old) and his daughter Corazon Cañezal (11 years old), both unmanifested passengers but proved to be on board the vessel.

After investigation, it was found that the MT Vector was at fault and responsible for its collision with MV Doña Paz.

Sebastian Cañezal's wife and mother filed a complaint for "Damages Arising from Breach of Contract of Carriage" against Sulpicio Lines, Inc. with the RTC of Manila. Sulpicio, in turn, filed a third-party complaint against Francisco Soriano, Vector Shipping Corporation, and Caltex (Philippines), Inc.

The trial court rendered a decision dismissing the third-party complaint against the petitioner. On appeal, CA modified the trial court's ruling and included petitioner Caltex as one of those liable for damages. Hence this petition.

ISSUE

Whether or not Caltex, the charterer of a sea vessel, is liable for damages resulting from a collision between the chartered vessel and a passenger ship.

RULING

No, Caltex, the charterer of a sea vessel, is not liable for damages.

Under the law, a charter party or a contract of affreightment is one by which the owner of a ship or other vessel lets the whole or part of her to a merchant or other person for the conveyance of goods, on a particular voyage, in consideration of the payment of freight. If the charter is a contract of affreightment, which leaves the general owner in possession of the ship as owner for the voyage, the rights and the responsibilities of ownership rest on the owner. The charterer is free from liability to third persons in respect of the ship.

In this case, Caltex and Vector entered into a voyage charter, which retains the character of the vessel (MT Vector) as a common carrier. The charterer of a vessel has no obligation before transporting its cargo to ensure that the chartered vessel complies with all legal requirements. The duty rests upon the common carrier simply for being engaged in "public service”. The nature of the obligation of Caltex demands ordinary diligence like any other shipper in shipping his cargo.

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