Eastern Shipping Lines, Inc. v. BPI/MS Insurance Corporation
REITERATIONFacts
The Antecedents: Sumitomo Corporation shipped steel coils through petitioner Eastern Shipping Lines, Inc. (petitioner) on three separate occasions. The first shipment on August 29, 2003, arrived on September 6, 2003, with nine coils found in bad condition upon unloading. The second shipment on September 13, 2003, arrived on September 23, 2003, with eleven coils damaged. The third shipment on September 29, 2003, arrived on October 11, 2003, with six coils damaged. In all instances, the damaged portions were rejected by the consignee, Calamba Steel Center Inc. (Calamba Steel). The damaged cargo was insured by Sumitomo with respondent Mitsui Sumitomo Insurance Co., Ltd. (Mitsui), and subsequently, Calamba Steel received payment for the damages from Mitsui through its settling agent, respondent BPI/MS Insurance Corporation (BPI/MS). Consequently, Mitsui and BPI/MS, as insurer and subrogee, filed a Complaint for Damages against petitioner and Asian Terminals, Inc. (ATI). Procedural History: The Regional Trial Court (RTC) of Makati City, Branch 138, rendered a Decision finding petitioner and ATI jointly and severally liable for actual damages, attorney's fees, and costs of suit. The Court of Appeals (CA) affirmed the RTC's decision with modification, deleting the award for attorney's fees but upholding the finding of negligence against both petitioner and ATI. The CA noted that the damage was caused by rough handling during unloading operations, citing the affidavit of a cargo surveyor. Petitioner and ATI appealed to the Supreme Court. The Petition: Petitioner Eastern Shipping Lines, Inc. sought the reversal of the CA decision, arguing that the damage was caused by the rough handling of goods by ATI during discharging operations, and that petitioner had no participation in these operations as ATI was the mandated arrastre operator. Petitioner contended that it should be absolved from liability.
Issue(s)
Whether the Court of Appeals committed any reversible error in finding that the petitioner is solidarily liable with Asian Terminals, Inc. on account of the damage incurred by the goods, considering the timing and cause of the damage. Whether the petitioner successfully proved that the damage to the goods was due to a cause beyond its control or that it exercised extraordinary diligence.
Ruling
The petition is DENIED. The Decision dated July 9, 2010, of the Court of Appeals in CA-G.R. CV No. 88361 is AFFIRMED.
Ratio Decidendi
On the issue of solidary liability and the timing of damage: The Supreme Court held that factual questions, such as determining liability for damage to goods, are generally not within the purview of a petition for review on certiorari. The Court found no reversible error in the CA's affirmation of the RTC's factual findings that the goods were already in bad order condition prior to their turnover to ATI, as evidenced by various Turn Over Surveys of Bad Order Cargoes (TOSBOC) and Requests for Bad Order Survey, indicating damage sustained during the sea voyage. The Court also acknowledged that the damage was compounded by the negligent acts of both petitioner and ATI during the discharging operations. On the issue of the petitioner's burden of proof and extraordinary diligence: The Court reiterated that cargoes, while being unloaded, generally remain under the custody of the carrier. Therefore, the petitioner, as a common carrier, is bound to observe extraordinary diligence in the vigilance over the goods transported. The Court emphasized that common carriers are responsible for the loss, destruction, or deterioration of goods unless it can prove that the cause was one of the exceptions provided by law, or that it exercised extraordinary diligence. In this case, the petitioner failed to hurdle this burden of proof, as the evidence showed damage occurred both during the voyage and was exacerbated by negligent handling during unloading.
Main Doctrine
A common carrier is presumed to have been at fault or negligent if the goods it transported deteriorated or got lost or destroyed, and it bears the burden of proving that it exercised extraordinary diligence to avoid responsibility for any loss or damage. The extraordinary responsibility of a common carrier lasts from the time the goods are unconditionally placed in its possession until they are delivered to the consignee.