G.R. No. 226345 - Pioneer Insurance and Surety Corp. vs. APL Co. Pte. Ltd.

On January 13, 2012, Chillies Export House Limited (the shipper) handed over 250 bags of chili pepper to APL Co. Pte. Ltd. (APL), the respondent and carrier, for transportation from Chennai, India, to Manila.
The shipment, with a declared value of $12,272.50, was loaded onto M/V Wan Hai 262.
BSFIL Technologies, Inc. (BSFIL) was the consignee and had insured the cargo with petitioner Pioneer Insurance and Surety Corporation (Pioneer Insurance).

The shipment arrived at North Harbor, Manila, on February 2, 2012, and was temporarily stored.
On February 6, 2012, BSFIL took delivery and discovered that 76 bags were wet and heavily infested with molds, rendering the goods unfit for human consumption and constituting a total loss.

BSFIL made a formal claim against APL and Pioneer Insurance.
Pioneer Insurance hired an independent adjuster who found the damage resulted from water seeping inside the container provided by APL.
Pioneer Insurance paid BSFIL P195,505.65 and, by subrogation, sought payment from APL, who refused.
Pioneer Insurance filed a complaint for sum of money against APL.

Municipal Trial Court (MTC), Branch 65, Makati City, ruled in favor of Pioneer Insurance, ordering APL to pay the claim amount with interest and attorney’s fees. The MTC held APL, as common carrier, liable for not exercising extraordinary diligence, presumed due to damage in its custody.
Regional Trial Court (RTC), Branch 137, Makati City, affirmed the MTC decision and upheld that the one-year prescriptive period under the Carriage of Goods by Sea Act (COGSA) applies, rejecting APL’s reliance on a shorter prescriptive period in the Bill of Lading.
The Court of Appeals (CA) reversed the trial courts, ruling the complaint was barred by a nine-month prescription period stipulated in the Bill of Lading and that this shorter period was reasonable and binding. CA held Pioneer Insurance, as subrogee, bound by the Bill of Lading terms.
Pioneer Insurance moved for reconsideration before the CA, which was denied. The petition for review on certiorari followed.

Whether the Court of Appeals erred in ruling that Pioneer Insurance’s claim against APL is barred by prescription.
Whether the Court of Appeals erred in holding that the one-year prescriptive period under the Carriage of Goods by Sea Act (COGSA) is not applicable.