Case Digest (G.R. No. 102316)
Facts:
Valenzuela Hardwood and Industrial Supply, Inc. v. Court of Appeals and Seven Brothers Shipping Corporation, G.R. No. 102316, June 30, 1997, Supreme Court Third Division, Panganiban, J., writing for the Court.Petitioner Valenzuela Hardwood and Industrial Supply, Inc. contracted with respondent Seven Brothers Shipping Corporation on January 16, 1984 to load 940 lauan round logs aboard M/V Seven Ambassador at Maconacon, Isabela for carriage to Manila under a charter party that expressly stipulated that the owners “shall not be responsible for loss, split, short-landing, breakages and any kind of damages to the cargo.” On January 20, 1984 petitioner procured a marine cargo insurance policy for P2,000,000.00 from South Sea Surety and Insurance Co., Inc. and tendered premium payment by check on January 24, 1984 through Mr. Victorio Chua.
The vessel sank on January 25, 1984 when iron chains snapped and the logs rolled to port; the trial court found as undisputed that the proximate cause of the sinking was negligence of the captain in stowing and securing the logs. South Sea later cancelled the policy for non-payment under Section 77 of the Insurance Code after a January 30 tender of payment was not accepted. Petitioner demanded indemnity from South Sea and filed a claim against Seven Brothers; both denied liability.
At the Regional Trial Court (Valenzuela, Branch 171) the court rendered judgment ordering South Sea to pay the policy value or, alternatively, Seven Brothers to pay P2,000,000.00 plus interest and attorney’s fees; South Sea’s counterclaim was dismissed. On appeal, the Court of Appeals modified the RTC judgment: it affirmed liability of South Sea but reversed and set aside the trial court’s imposition of liability on Seven Brothers, reasoning that as a private carrier Seven Brothers could validly contract to exempt itself from liability even for negligence (relying on Home Insurance Co. v. American Steamship Agencies, Inc., 23 SCRA 24).
Petitioner filed a petition for review of the CA decision to this Court (Rule 45). This Court had earlier denied South Sea’s separate petition (G.R. No. 102253, June 2, 1995), ...(Subscriber-Only)
Issues:
- Did the Court of Appeals err in holding that the exculpatory stipulation in the charter party absolving Seven Brothers Shipping Corporation from liability for loss of the cargo — including loss resulting from the negligence of its captain or employees — is valid and enforceable against Valenzuela Hardwood and Indust...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)