195. Metro Port Service v.

IAC 213 SCRA 103

Doctrines
Commercial Law; Common Carriers; Contracts; Strict and reasonable construction of
provision limiting liability of public utility necessary to protect public interest.-The
Court must stress that petitioner Metro Port Servi ce !nc. i s a publi c uti li ty
discharging functions which are heavily invested with a public interest. This
provi si on l imiting the l iabi li ty of sai d petitioner through the i mposition of a
re"uirement that a #formal claim$ must be made within thirty %&'( days from )ling
of entry must be carefully scrutini*ed and reasonably construed so as to protect the
legitimate interest of the public which the public utility must serve. !t is the Court+s
duty to tone down this harsh and unreasonable provision and give it a reasonable
interpretation.
Same; Contracts; ,emand; Substantial compliance of re"uisites for #formal$
demands su cient for valid claim.-The )ling by the consignee of this provisional
claim/ on March 01 2340-1 days after the )ling of the entry-is substantial
compliance with the demand for a #formal claim$ because as of that date the
arrastre operator was given the reasonable opportunity to chec5 the validity of the
claim while the facts were still fresh in the minds of the persons who too5 part in the
transaction and while the pertinent documents were still available. !t did not matter
that the provisional claim was for the whole amount of the invoice as a provisional
claim-without the value of the goods stated therein-is su cient as long as the name
of the carrying vessel its date of arrival and the corresponding bill of lading are
attached. Consignee+s #provisional claim$-aside from the entire value of the invoicehad
all
three
other
re"uirements.
Facts:
6s insurer-subrogee private respondent instituted Civil Case 7o. 3'289 before the
Court of :i rst !nstance of Manil a entitled The <ome !nsurance Co. versus
Marchessini Lines Citadel Lines !nc. and=or >. ?a*on !nc. and=or 6@aA Customs
Bro5erage.
The action was to recover from the defendants the amount that private respondent
paid 6merican ire and Cable Co. !nc. %consignee( under its policy for losses and
damages to an insured shipment the transportation of which was handled by
defendants one after the other.
The shipment which was transported from 7ew Dor5 to Manila on board the S=S
BE?DB6T>S consisted of synthetic resins insulating materials machinery and
copper wire contained in several pac5ages. !t arrived in Manila on March 28 2340
and was discharged doc5side unto the care and custody of petitioner the arrastre
operator in the Port of Manila.
6t the time of the discharge of the shipment from the carrying vessel it was noted
that said cargo had already sustained shortages and that some pac5ages were in
bad order and damaged condition. So when the shipment was turned over to the
petitioner turn-over surveys were @ointly prepared and accomplished by chec5ers of
both the vessel and the arrastre operator.
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8/9/2019 195. Metro Port Service v. IAC 213 SCRA 103
:rom March 03 to Fune 2 2340 deliveries of the shipment were made by petitioner
to the consigneeGs bro5er the defendant 6@aA Customs Bro5erage. 6t this stage of
the cargo handling the shipment had already sustained a shortage of 22 pallets and
08 of the pac5ages delivered to the bro5er were already in bad order and damaged
condition. The shortage of 22 pallets was covered by a certi)cate of delivery issued
by petitioner and the 08 bad order pac5ages were covered by bad order certi)cates
also issued by petitioner.
!n the meantime on March 01 2340 the consignee presented to petitioner a
provisional claim for the full value of the shipment. Hn September 29 2340 the
consignee submitted to petitioner a formal claim for the actual value of the loss
sustained by the shipment.
!n the course of the proceedings before the trial court defendants Marchessini Lines
and Citadel Lines settled the claim for the loss attributed to the vessel. The case
therefore proceeded only against remaining defendants >. ?a*on !nc. %now
petitioner( and 6@aA Bro5erage Corp. who were ad@udged liable to plaintiI now
private respondent.
Hn appeal to the !ntermediate 6ppellate Court the decision appealed from was
a rmed.
6t any rate petitioner disclaims any liability due to the fact that private respondent
did not )le a formal claim within &' days from the )ling of entry on March 0'
2340 as the formal claim was )led on September 29 2340. Petitioner disregarded
the )ling of a provisional claim on March 01 2340 on the ground that it is not the
claim demanded by the ?evised Management Contract which >. ?a*on !nc. as
6rrastre Contractor entered into with the Bureau of Customs on the 04th day of
Fanuary 2394.
Private respondent on the other hand claims that despite the change introduced in
the matter of )ling claims i.e. formal claims have to be )led the purpose is still
the same J to aIord the arrastre operator the opportunity to chec5 the validity of
the claims.
Issue:
hether or not under the ?evised Management Contract the words formal claim
eAclude any provisional claimK$
Hel :
7o. Petition is unmeritorious. The petitioner being a public utility it may not easily
do away of its liability by providing a clause in its ?evised Management Contract
that a #formal claim$ is necessary doing so will be unreasonable to public interest.
The ?evised Management Contract provides # BNut said CH7T?6CTH? shall not be
responsible for the condition of the contents of any pac5age received nor for the
weight nor for any loss in@ury or damage to the said cargo before or while the
goods are being received or remain on the piers or wharves if the loss in@ury or
damage is caused by force ma@eure or other causes beyond the CH7T?6CTH?Gs
control or capacity to prevent or remedy; P?HO!,>, that a formal claim together
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with the necessary copies of the bill of lading invoice certi)ed pac5ing list ban5
certi)cate showing the rate of eAchange at the time of purchase or opening of letter
of credit and the computation arrived at covering the loss damage or non-delivery
of such goods shall have been )led with the CH7T?6CTH? within thirty %&'( days
from the date of )ling of entry; P?HO!,>, :E?T<>? that if the loss in@ury or
damage is discovered within the last )fteen %2 ( days of said period of thirty %&'(
days then the formal claim shall be )led within )fteen %2 ( days from the date of
discovery of the loss in@ury or damage.$
!n the case at bar the shipment in "uestion arrived in Manila on March 28 2340.
The import entry was )led March 0' 2340. The deliveries of this shipment started
March 03 2340 and ended on Fune 2 2340. Since the delivery of the last pac5age
was made on Fune 2 2340 J 4& days after the )ling of the import entry J then a
literal compliance under paragraph QQ of the ?evised Management Contract would
mean that 6merican ire and Cable Co. %consignee insured by private respondent(
had only until 6pril 0' 2340 to )le a formal claim for damaged goods. But said
GGformal claimGG would cover only goods delivered as of 6pril 0' 2340 J the cost of
goods delivered after said date in a damaged condition or lost J would be for the
consigneeGs own account.
The Court must stress that petitioner Metro Port Service !nc. is a public utility
discharging functions which are heavily invested with a public interest. This
provi si on l imiting the l iabi li ty of sai d petitioner through the i mposition of a
re"uirement that a formal claim must be made within thirty %&'( days from )ling
of entry must be carefully scrutini*ed and reasonably construed so as to protect the
legitimate interest of the public which the public utility must serve. !t is the CourtGs
duty to tone down this harsh and unreasonable provision and give it a reasonable
interpretation.
The )ling by the consignee of this provisional claim on March 01 2340 J 1 days
after the )ling of the entry J is substantial compliance with the demand for a
formal claim because as of that date the arrastre operator was given the
reasonable opportunity to chec5 the validity of the claim while the facts were still
fresh in the minds of the persons who too5 part in the transaction and while the
pertinent documents were still available. !t did not matter that the provisional claim
was for the whole amount of the invoice as a provisional claim J without the value
of the goods stated therein J is su cient as long as the name of the carrying
vessel i ts date of arrival and the correspondi ng bil l of l ading are attached.
ConsigneeGs provisional claim J aside from the entire value of the invoice J had
all three other re"uirements.