Can
the carrier release cargo without requiring surrender of the B/L? (April 19, 2004)
YES. And this is the story. On 24 February 1980, the Nabo Corporation of
Japan shipped a cargo via the S/S Adventure for Manila. The bill of lading was
consigned to "Shipper's Order", with "Address Arrival Notice to Cubi Mines, Inc.
(CMI) 777 Ayala Avenue, Makati, Metro Manila". The cargo arrived in Manila.
On the basis of an Undertaking for Delivery of Cargo executed by CMI but without
surrendering the original bill of lading, the carrier released the shipment to
CMI. About five months later, the carrier received from Rica Bank a letter
informing the former that it is holding the full set of the original bill of lading
and inquiring as to the status of the subject cargo. This was followed by another
letter from the counsel of Rica Bank contemplating legal action against the carrier.
Then, Rica Bank received a letter from CMI admitting that they received
the shipment in question due to a "guarantee" it executed and that any legal action
be held in abeyance for at least 30 days in order to settle its account with the
said bank. However, CMI failed to fulfill its promise. Thus, Rica Bank
filed a complaint before the Court of First Instance (now RTC) of Rizal against
the carrier for the value of the cargo covered by the bill of lading plus damages. Later
on, the carrier filed a third-party complaint against CMI seeking reimbursement
for whatever pecuniary obligations it may be held liable to Rica Bank. After trial
on the merits, the trial court rendered a decision finding the carrier liable
to Rica Bank with a right of reimbursement from CMI. The trial court denied
the motion for reconsideration of the carrier. And the carrier appealed to the
Court of Appeals. But the Court of Appeals sustained the decision of the
trial court. And the carrier had to appeal to the Supreme Court. The Supreme
Court ruled in the following tenor: x x x
At the outset, the Bill of Lading which was issued by the carrier but contained
articles furnished by the Shipper, shows on its face that the Shipment is consigned
"TO SHIPPER'S ORDER" with "ADDRESS ARRIVAL NOTICE TO CUBI MINES INC. 777 AYALA
AVE. MAKATI, METRO MANILA, PHILIPPINES" (Annex A of Complaint, p. 7, Original
Records). Nowhere did the Bill of Lading refer to respondent (Rica
Bank) as the consignee or the one to be notified. The foregoing information, without
more, in effect makes CMI for all practical intents and purposes the party named
and ordered to receive the goods. The petitioner-carrier, not being
privy to any transaction between Rica Bank and CMI, cannot be expected to look
beyond what is contained on the face of the bill of lading in question and guess
which of the many banks in Metro Manila or some unrevealed corporation could possibly
the consignee. To consider otherwise would not be sound business
practice as petitioner-carrier would be forced to wait for the real owner of the
goods to show up, perhaps in vain. x x x But
assuming that CMI may not be considered as the consignee, the petitioner-carrier
cannot be faulted for releasing the goods to CMI under the circumstances, due
to its lack of knowledge as to who was the real consignee in view of CMI's strong
representations and letter of undertaking wherein it stated that the bill of lading
would be presented later. This is precisely the situation covered by the
last paragraph of Art. 353 of the Code of Commerce to wit: If in case the consignee
cannot return, upon receiving the merchandise, the bill of lading subscribed by
the carrier, due to its loss or for any other cause, he must give the said carrier
a receipt for the goods delivered, this receipt producing the same effects as
the return of the bill of lading. Thus, let us always remember that under
exceptional circumstances, the carrier may release the goods without requiring
the consignee to surrender the bill of lading. But it is always better to secure
the written consent of the shipper before releasing the cargo to the consignee
without the bill of lading. For questions or comments, email the author
at jtb@pac-atlantic.com. Back
to Top Passenger
Rights in Times of Vessel Delay (May 31, 2004) Atty. Renato Alano bought
a ticket from Asia Shipping, Inc. for the voyage of the MV Asia to Cagayan De
Oro from Cebu City on 12 November 1991. At around 5:30 in the evening of
the same day when Atty. Alano boarded the vessel, he noticed that some repairs
were being done on the engines. The vessel departed at about 11:00 p.m. with only
one engine running. After an hour of slow voyage, the vessel stopped and
dropped its anchor. After half an hour, some passengers demanded that they be
allowed to return to Cebu City for they were no longer willing to proceed to Cagayan
De Oro City. Thus, the vessel headed back to Cebu City. In Cebu City, Atty.
Alano and the other passengers of the MV Asia were allowed to disembark. Thereafter,
the vessel proceeded to Cagayan De Oro City. On the following day, Atty. Alano
boarded another vessel owned and operated by Asia Shipping. On account of the
failure of MV Asia to transport him to Cagayan De Oro City on 12 November 1991,
Atty. Alano filed a complaint for damages against Asia Shipping. After
trial on the merits, the trial court dismissed the complaint on the ground that
Asia Shipping did not exclude Atty. Alano from the trip of the MV Asia. If he
was left behind, it was because of his fault or negligence. Unsatisfied,
Atty. Alano appealed to the Court of Appeals. The Court of Appeals reversed the
trial court's decision but did not allow the grant of damages for the delay in
the performance of the obligation of Asia Shipping. Asia Shipping elevated
the case to the Supreme Court. And the Supreme Court ruled: x
x x as found by the respondent Court (Court of Appeals), there was
in fact no delay in the commencement of the contracted voyage. If any delay was
incurred, it was after the commencement of such voyage, more specifically, when
the voyage was subsequently interrupted when the vessel had to stop after the
only remaining engine conked out. x x x
Article 698 (Code of Commerce) must then be read together with Articles 2199,
2200, 2201 and 2208 in relation to Article 21 of the Civil Code. So read, it means
that the petitioner (Asia Shipping) is liable for any pecuniary loss or loss of
profits which the private respondent (Atty. Alano) may have suffered by reason
thereof. x x x This however assumes
that he stayed on the vessel and was with it when it thereafter resumed its voyage;
but he did not. As he and some other passengers resolved not to complete the voyage,
the vessel had to return to its port of origin and allow them to disembark. x
x x Let us bear in mind that for delays after the commencement of
the voyage - more specifically, when the voyage is subsequently interrupted due
to unseaworthiness - the vessel is liable for any pecuniary loss or loss of profits
which the passengers may suffer pursuant to Article 698 of the Code of Commerce.
For comments, email the author at jtb@pac-atlantic.com.ph.
Back to Top Can
the courts compel the BoC to seize and forfeit imports? NO. And this is
the story. On 5 April 1989, JJ Corporation imported four containers of
matches from Indonesia. The shipment was released without any question by the
Bureau of Customs (BOC). On 25 April 1989, Provident Farms, Inc. (PFI),
a domestic corporation engaged in industrial tree planting, secured a certification
from the Secretary of the Department of Natural Resources and Environment that
"there are enough available softwood supply in the Philippines for the match industry
at reasonable price". PFI supplies wood to local match manufacturers for the production
of matches. PFI subsequently filed with the Regional Trial Court of Manila
a complaint for injunction and damages with a prayer for a temporary restraining
order against the BOC Commissioner and JJ Corporation to enjoin them from further
importing matches and "wood derivated" products. JJ Corporation moved to
dismiss the complaint, alleging that "the Commissioner of Customs has exclusive
jurisdiction to determine the legality of an importation or ascertain whether
the conditions prescribed by law for an importation have been complied with".
PFI opposed the motion to dismiss. The trial court denied the motion to dismiss.
However, on motion for reconsideration by JJ Corporation, the trial court reconsidered
its previous order and dismissed the case on the ground that it had "no jurisdiction
to determine what are legal or illegal importations". PFI elevated the
case to the Supreme Court. It interposed the argument that what was brought before
the trial court was a civil case for injunction. And it was meant to restrain
the entry of safety matches into the country and for the purpose of securing compliance
with the provisions of the Revised Forestry Code. But the Supreme Court
ruled in the following manner: "The enforcement of the import ban under
Sec. 36, par. (1), of the Revised Forestry Code is within the exclusive realm
of the Bureau of Customs, and direct recourse of petitioner (PFI) to the Regional
Trial Court to compel the Commissioner of Customs to enforce the ban is devoid
of any legal basis. To allow the regular court to direct the Commissioner to impound
the imported matches, as petitioner would, is clearly an interference with the
exclusive jurisdiction of the Bureau of Customs over seizure and forfeiture cases.
An order of a judge to impound, seize or forfeit must inevitably be based on his
determination and declaration of the invalidity of the importation, hence, a usurpation
of the prerogative and an encroachment on the jurisdiction of the Bureau of Customs.
In other words, the reliefs directed against the Bureau of Customs as well as
the prayer for injunction against importation of matches may not be granted without
the court arrogating upon itself the exclusive jurisdiction of the Bureau of Customs."
Thus, let us always remember that the courts cannot compel the Bureau of
Customs to seize and forfeit importations. But this does not preclude recourse
to the courts by way of the extraordinary relief of certiorari under Rule
65 of the Rules of Court if the BOC should gravely abuse the exercise of its jurisdiction.
For comments or inquiries, contact the author at jtb@pac-atlantic.com.ph.
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