Thursday, January 18, 2024

Case Digest: Maersk Line vs. Court of Appeals, G.R. No. 94761

 

Maersk Line vs. Court of Appeals, 222 SCRA 108, G.R. No. 94761, May 17, 1993

Subject: Transportation Law


FACTS

Efren Castillo, proprietor of Ethegal Laboratories, ordered 600,000 empty gelatin capsules from Eli Lilly, Inc. for his pharmaceutical products in the Philippines. The capsules were placed in 6 drums of 100,000 capsules each valued at $1,668.71. Eli Lilly informed Castillo that the capsules were already shipped on board MV "Anders Maesrkline" and expected to arrive in the Philippines on April 3, 1977. However, the capsules were diverted to Richmond, VA, and then back to Oakland, CA, resulting in the goods arriving in the Philippines on June 10, 1977. Castillo refused to take delivery and filed an action for rescission of contract with damages against Maersk and Eli Lilly, alleging gross negligence and undue delay.

After trial, the court rendered judgment in favor of respondent Castillo. On appeal, respondent court affirmed the lower court's decision with modifications.

ISSUE

Whether or not the common carrier is liable for damages.

RULING

Yes, the common carrier is liable for damages.

Under settled jurisprudence, common carriers are not obligated by law to carry and to deliver merchandise, and persons are not vested with the right to prompt delivery, unless such common carriers previously assume the obligation to deliver at a given date or time, delivery of shipment or cargo should at least be made within a reasonable time.

In this case, SC held that the petitioner is liable for damages due to the delay in the delivery of goods, based on the rule that contracts of adhesion are void. The lower court ruled that the exemption against liability for delay is against public policy and therefore void. The private respondent's action is anchored on Article 1170 of the NCC, not Admiralty law. The delay of two 2 months and seven 7 days was beyond reasonableness. The shipment was described as gelatin capsules for pharmaceutical products and was mishipped to Richmond, Virginia due to the petitioner's negligence. The petitioner's insistence that it cannot be held liable for the delay is found to be unfounded.

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