Benito Macam doing business under the name and style Ben-Mac Enterprises v. Court of Appeals, China Ocean Shipping Co., and/or Wallem Philippines Shipping, Inc.
REITERATIONFacts
The Antecedents: Petitioner Benito Macam, doing business as Ben-Mac Enterprises, shipped 3,500 boxes of watermelons and 1,611 boxes of fresh mangoes to Hongkong. The shipment was covered by bills of lading with the National Bank of Pakistan (PAKISTAN BANK) as consignee and Great Prospect Company (GPC) as notify party. Petitioner's bank, Consolidated Banking Corporation (SOLIDBANK), paid petitioner the value of the shipment in advance. Upon arrival in Hongkong, respondent Wallem Philippines Shipping, Inc. (WALLEM) delivered the shipment to GPC without the required bills of lading being surrendered. Subsequently, GPC failed to pay PAKISTAN BANK, which then refused to pay petitioner through SOLIDBANK. Petitioner reimbursed SOLIDBANK and demanded payment from WALLEM, but to no avail. Procedural History: Petitioner filed a collection case against respondents before the Regional Trial Court (RTC) of Manila. Respondents contended that the delivery without presentation of bills of lading and bank guarantee was per petitioner's request due to the perishable nature of the goods, citing a telex instruction. The RTC ruled in favor of petitioner, finding that respondents breached the bill of lading provision by releasing the shipment without the required documents. The Court of Appeals (CA) reversed the RTC decision, holding that previous similar transactions allowed delivery to GPC without bills of lading, that the telex instruction superseded the bills of lading, and that petitioner failed to substantiate his claim of reimbursement to SOLIDBANK. The Petition: Petitioner submits that the shipment was misdelivered as it was not delivered to the consignee or a party designated by the consignee. He argues that even if the telex instruction existed, it referred to PAKISTAN BANK as the consignee.
Issue(s)
1. Whether respondents are liable to petitioner for releasing the goods to Great Prospect Company (GPC) without the bills of lading or bank guarantee, in light of an alleged telex instruction and established business practice. 2. Whether there was a misdelivery of the cargoes by respondents.
Ruling
The petition is denied. The decision of the Court of Appeals dismissing the complaint is affirmed.
Ratio Decidendi
On Issue 1: The Supreme Court held that respondents are not liable for releasing the goods to GPC without the bills of lading or bank guarantee. The Court found compelling evidence supporting the respondents' claim that petitioner himself requested such a delivery. Petitioner's own testimony revealed a consistent business practice over two to three years of shipping perishable goods to GPC, often requesting immediate release via telephone calls, especially when fully paid through telegraphic transfers, thus dispensing with the need for a bill of lading or bank guarantee. The Court recognized the existence and validity of the telex dated April 5, 1989, which instructed delivery to respective consignees without requiring the bill of lading or bank guarantee for prepaid shipments. This telex, combined with the established practice for perishable goods, effectively superseded the general requirement for bill of lading presentation. The Court found the petitioner's claim of 'not remembering' the telex unconvincing given his admissions about his standard operating procedures with GPC and respondents. On Issue 2: The Supreme Court ruled that there was no misdelivery of the cargoes. The Court first noted that petitioner's complaint and previous demand letters focused on delivery without the required documents, not primarily on misdelivery to the wrong party. However, even addressing the misdelivery argument, the Court applied Article 1736 of the Civil Code, which states that a common carrier's extraordinary responsibility lasts until delivery to the consignee 'or to the person who has a right to receive them.' While PAKISTAN BANK was the consignee, GPC was clearly named as the buyer/importer in the export invoices and acknowledged as such by the petitioner in his demand letter and complaint. Citing Eastern Shipping Lines, Inc. v. Court of Appeals (1990) and Samar Mining Company, Inc. v. Nordeutscher Lloyd (1984), the Court concluded that delivery to GPC, as the buyer/importer, was proper because GPC had the right to receive the goods. Furthermore, the Court of Appeals correctly interpreted the telex to refer to GPC as the intended recipient for immediate delivery, reasoning that if PAKISTAN BANK were the strict recipient, the requirement of a bank guarantee (as a substitute for a missing bill of lading) would be illogical since PAKISTAN BANK held the original bills.
Main Doctrine
A common carrier's extraordinary responsibility lasts until actual or constructive delivery of the cargoes to the consignee or to the person who has a right to receive them. Delivery to the buyer/importer, who has the right to receive the goods other than the consignee, is considered proper, especially when instructed by the shipper for perishable goods and when the shipper has been fully paid.