Title
Atlantic Mutual Insurance Co. vs. United Philippine Lines, Inc.
Case
G.R. No. L-21546
Decision Date
Mar 31, 1966
A 1961 shipment of cotton remnants arrived in Manila with a 138.4-pound shortage. The Supreme Court ruled the provisional claim valid, holding Manila Port Service liable for the loss.
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Case Digest (G.R. No. L-21546)

Facts:

1. Shipment Details:

  • On March 24, 1961, S.S. "Philippine President Magsaysay," owned and operated by United Philippine Lines, Inc., took onboard 16 bales of cotton remnants in New York City, U.S.A., consigned to Vera Clothes, Inc., Manila.
  • The shipment was insured with Atlantic Mutual Insurance Company for $8,950.00.

2. Arrival and Discharge:

  • The vessel arrived in Manila on April 29, 1961, and discharged the 16 bales of cotton remnants to the Manila Port Service, a subsidiary of the Manila Railroad Company, in good order.

3. Provisional Claim:

  • On May 3, 1961, Vera Clothes, Inc., through its broker, Liberty Brokerage, Inc., filed a provisional claim with the Manila Port Service for short-landed or bad-order cargo.
  • On May 16, 1961, the Manila Port Service delivered the 16 bales, but two bales were short by 138.4 pounds, valued at $48.44, as per Bad Order Examination Report No. 230.

4. Subsequent Actions:

  • On May 17, 1961, Vera Clothes, Inc. filed another provisional claim with C.F. Sharp & Co., Inc., the shipping agent for S.S. "Philippine President Magsaysay," which denied liability, stating the shipment was discharged in good order.
  • Atlantic Mutual Insurance Company compensated Vera Clothes, Inc. for the loss in the amount of $293.16.

5. Filing of the Case:

  • On April 30, 1962, Atlantic Mutual Insurance Company, as successor-in-interest of Vera Clothes, Inc., filed a case in the Court of First Instance of Manila against United Philippine Lines, Inc., Manila Port Service, and Manila Railroad Company to recover $293.16 or its peso equivalent.

6. Lower Court Decision:

  • The Court of First Instance dismissed the complaint, absolving United Philippine Lines, Inc. from liability, ruling that the provisional claim did not comply with Section 15 of the arrastre management contract.

Issue:

  1. Whether the provisional claim filed by Vera Clothes, Inc. with the Manila Port Service substantially complies with Section 15 of the arrastre management contract.
  2. Whether the Manila Port Service is liable for the loss of 138.4 pounds of cotton remnants.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Conclusion:

The Supreme Court held that the provisional claim filed by Vera Clothes, Inc. was valid and that the Manila Port Service was liable for the loss. The judgment of the lower court was reversed, and the Manila Port Service was ordered to pay Atlantic Mutual Insurance Company the amount claimed.


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