SULPICIO LINES, INC.

, petitioner,
vs.
FIRST LEPANTO-TAISHO INSURANCE
CORPORATION, respondent

Mila S. Colar
FACTS OF THE CASE

• Sulpicio Lines Inc. is the owner of the vessel

M/V Philippine Princess, the common carrier
which transported the three wooden crates
containing the goods owned by Taiyo
Yuden Philippines Inc., from Cebu to Manila.
FACTS OF THE CASE
• It was Delbros, Inc. that entered into a
shipping contract with Taiyo Yuden
Philippines to transport the goods to the
consignee, Taiyo Yuden Singapore,
evidenced by a Bill of Lading issued by the
former. Delbros only engaged the services
of Sulpicio Lines.
FACTS OF THE CASE
• Upon arrival of the goods in Manila and
during the unloading of the shipment, one
crate dropped from the cargo hatch to the
pier apron, and was declared by the
owner, unfit to be transported to the
consignee.
FACTS OF THE CASE
• The goods were rejected as a total loss and
were returned to Cebu City.
• Taiyo Yuden Phils., the owner of the goods
claimed payment from First-Lepanto-Taisho
Insurance Corp., the respondent of herein
case, under a marine insurance policy
issued by the latter.
FACTS OF THE CASE

• Respondent – insurer paid the claim, less 35%

salvage value and is now claiming
reimbursement from shipper, Delbros and
petitioner – carrier Sulpicio Lines, as jointly
and severally liable.
ISSUES
• Whether or not, the owner of the goods, the
predecessor-in-interest of respondent-insurer/
subrogee, did incur damages, and if so,
whether or not petitioner – carrier is liable for
the same and to what extent.
RULING
• Petitioner – carrier, from the nature of its
business and for reason of public policy is
expected to observe extra – ordinary
diligence as required in Art. 1733 of the New
Civil Code (NCC) in the handling of goods
placed in its possession for transport.
 RULING
• A common carrier is bound to transport its cargo and its
passengers safely "as far as human care and foresight
can provide, using the utmost diligence of a very
cautious person, with due regard to all circumstances.
• The extraordinary diligence in the vigilance over the
goods tendered for shipment requires the common
carrier to know and to follow the required precaution
for avoiding the damage to, or destruction of, the
goods entrusted to it for safe carriage and delivery.
RULING
• It requires common carriers to render service
with the greatest skill and foresight and to use
all reasonable means to ascertain the nature
and characteristic of goods tendered for
shipment, and to exercise due care in the
handling and storage, including such
methods as their nature requires.
RULING
• When the shipment suffered damages when
it was being unloaded, due to the falling of
one crate, petitioner-carrier is presumed to
have been negligent in the handling of the
damaged cargo.
RULING

• Under Art. 1735 and 1752 of the NCC,

common carriers are presumed to have
been at fault or to have acted negligently in
case the goods transported by them are lost,
destroyed or had deteriorated.
RULING
• To overcome the presumption of liability for
loss, destruction or deterioration goods under
Art.1735, the common carrier must prove that
it observed the extraordinary diligence
required in Art. 1733, which petitioner-carrier
miserably failed to adduce any shred of
evidence, hence, it is liable for the damages
suffered by the owner of the goods.
RULING
• On the issue of the extent of petitioner-carrier’s
liability, damage to the packaging, though
only a portion, is tantamount to the damage
to the whole cargo, which resulted in its
unfitness to be transported to its consignee in
Singapore, as its final destination, thus resulted
in damages on the part of the owner of the
goods.
RULING
• Respondent-insurer upon payment of the
alleged amount of loss suffered by the
insured(owner of the goods) is entitled to be
subrogated pro tanto(for so much)for any
right of action which the insured may have
against the common carrier whose
negligence caused the loss.
RULING

• Thus, petitioner-carrier is liable to pay

the amount paid by the respondent-
insurer for the damages sustained by
the owner of the goods.
RULING
• Delbros, Inc. having paid the full amount
of the damage to respondent-insurer,
gives the latter no right to again recover
from petitioner-carrier by virtue of the
principle of unjust enrichment on the part
of respondent.
RULING

• Since Delbros, Inc. is not a party to the

instant case, the Court did not decide on
its prayer for indemnification, but without
prejudice for its separate action to be
instituted against petitioner-carrier.
THANK
YOU!