Case Digest: Delgado Brothers vs. Home Insurance, 1 SCRA 853

Delgado Brothers vs. Home Insurance, 1 SCRA 853

Subject: Transportation Law

FACTS

In 1955, Victor Bijou & Co. shipped aboard the vessel S.S. Leoville, and consigned to the Judy Philippines, Inc. of Manila a shipment of 1 case Linen Handkerchief and 2 cases cotton piece goods from New York to Manila.

The shipment was insured with herein respondent by the shipper and/or consignee. The shipment was unloaded complete and in good order from the said vessel by the petitioner, but the latter delivered the same to the consignee with 1 case of Linen Handkerchief in bad order, with a shortage of 503 yards of Linen Print Handkerchiefs, to the prejudice, loss and damage of the shipper and/or consignee.

Respondent paid the shipper/consignee and was issued a subrogation receipt. Notwithstanding the respondent’s claim, the petitioner failed and refused to pay the shipper and/or consignee and/or respondent. Hence, the respondent was compelled to file the case.

As special defense, petitioner alleged that since no claim whatsoever was filed by respondent or the consignee, or their representatives against petitioner 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 hence petitioner is completely relieved and released of any 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 for the Port of Manila; and that petitioner in no way acts as an agent of the carrying vessel or of the importer or consignee. Petitioner, therefore, prayed for the dismissal of respondent’s complaint.

After trial, the court rendered a decision dismissing the case and absolving petitioner from liability on the merits of the latter’s special defenses invoked in its answer. On appeal, CA reversed CFI’s decision and ordered the petitioner to pay to respondent.

ISSUE

Whether or not CFI had no jurisdiction over the subject matter of the action, the same not being an admiralty case, and the amount sought to be recovered falling within the exclusive original jurisdiction of the Municipal Court of Manila.

RULING

Yes, CFI had no jurisdiction over the subject matter of action, the same not being an admiralty case, and the amount sought to recover falls within the exclusive original jurisdiction of the MTC of Manila.

Under the law, in case of controversy involving both maritime and non-maritime 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.

In this case, Section 2 of the Management Contract with the Bureau of Customs clearly states the functions of petitioner as arrastre operator. Nothing in those functions relates to the trade and business of navigation nor the use or operation of vessels.  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 and does not deal with any maritime matter or with the administration and application of any maritime law. Court of First Instance of Manila has jurisdiction in cases where suit is brought directly against the carrier or shipowner. 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.