Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-5733 October 19, 1961
NORTHWEST TRACTOR & EQUIPMENT (PHIL.) CORPORATION, plaintiff-appellant,
vs.
MORALES SHIPPING COMPANY, INC., defendant-appellant.
LUZON BROKERAGE CO., INC., intervenor.
NORTHWEST TRACTOR & EQUIPMENT (PHIL.) CORPORATION, plaintiff-appellant,
vs.
MORALES SHIPPING COMPANY, INC., defendant-appellant.
LUZON BROKERAGE CO., INC., intervenor.
William H. Quasha for plaintiff-appellant.
Mariano H. de Joya for defendant-appellee.
Jose G. Macatangay for intervenor.
R E S O L U T I O N
PADILLA, J.:
In a complaint filed on 18 March 1948 in the Court of First Instance of Manila by the Northwest Tractor & Equipment (Phil.) Corporation against Morales Shipping Company, Inc., the plaintiff alleges: that for and in consideration of the sum of P8,000 to be paid by the plaintiff to the defendant, the latter undertook to carry and transport on board its vessels San Vicente M and LCT 787 from Guiuan, Samar, to Manila, war surplus machineries, spare parts and equipments belonging to the former; that pursuant to the said contract of carriage, on 6 February 1948 the plaintiff delivered to the defendant in Guiuan, Samar, the machineries, spare parts and equipments enumerated and described in the bills of lading issued by the defendant; that instead of issuing the said bills of lading in the name of the plaintiff as owner and consignee, the same were issued in the name of Northwest Commercial Corporation, with offices at 312 Regina Building, Manila, where the plaintiff also has its office and principal place of business; that the issuance of the bills of lading in the name of the said corporation was a clerical error committed by the defendant; that the contracting parties had expressly agreed that the cargoes would be shipped from the port of Guiuan, Samar, directly to Manila and the vessels transporting them would arrive in Manila within fifteen days from 6 February 1948, the date of departure; that the vessels transporting the plaintiff's cargoes did not proceed directly to Manila but deviated the port of Cebu where they were detained and delayed for violation of customs regulations and failure to pay the laborers' wages; that as a result of the deviation from the agreed route and the negligence and misbehaviour on the part of the skipper and crew of the vessels San Vicente M and LCT 787, the latter which was being towed by the former capsized and sunk at a point 120* 57' East longitude, 11* 22' North latitude, resulting in the loss of the plaintiff's cargo on board the said LCT 787; that upon arrival of the vessel San Vicente M in Manila the defendant refused to deliver to the plaintiff the cargo on board the said vessel; and that the plaintiff is willing to pay to the defendant the balance of the freight due thereon amounting to P2,371.70, less the loans and advances given by the former to the latter, provided that the defendant would pay the plaintiff the value of its lost cargo on board the vessel LCT 787 that sunk. Upon the foregoing material averments, the plaintiff prays for recovery from the defendant of the sum of P80,000, the alleged value of the plaintiff's cargo on board the lost vessel LCT 787; P5,000 as damages for the defendant's misbehavior and negligence in the carriage of the cargo; and P5,000 as damages for the defendant's refusal and failure to deliver to the plaintiff upon arrival in Manila the cargo on board the defendant's vessel LCT San Vicente M; upon the filing of a bond in the amount of P60,000 in favor of the defendant, for an order, under the provisions of Rule 62 of the Rules of Court, directing the Sheriff of the City of Manila "to take into his possession and custody of all the goods listed in par. IV of the SECOND CAUSE OF ACTION," and, after trial, for recovery thereof or, in case the said items could no longer be recovered, for collection of the sum of P30,000, the value thereof; for the costs of the suit; and for other just and equitable relief (civil No. 4951).
On 19 and 20 March 1948, upon the plaintiff's request and after it had filed the necessary bonds, the Court ordered the seizure and attachment of the defendant's personal and other properties.
On 31 March 1948 the defendant filed a motion to dismiss; on 23 April 1948 the plaintiff, an answer thereto; on 22 May 1948 the defendant, a reply to the plaintiff's answer to motion to dismiss; and on 19 June 1948 the Court denied the defendant's motion to dismiss.
On 13 July 1948 the defendant filed an amended answer superseding the original filed on 7 June 1948, setting up the following affirmative defenses: that there is no privity of contract between the plaintiff and the defendant because the bills of lading which constitute the contract between the parties were in the name of the Northwest Commercial Corporation; that granting arguendo that the plaintiff is the true and real consignee of the cargoes, in the bills of lading it had expressly waived all claims for damages sustained during the voyage; that the plaintiff is solely responsible for the loss of the cargo on board the vessel LCT 787 because it was loaded by the plaintiff's own personnel using its equipments and without the intervention of the captain and first mate of the vessels; that the plaintiff is grossly negligent and reckless in loading the cargoes; that as a result of the plaintiff's gross negligence and recklessness the vessel San Vicente M was damaged and the vessel LCT 787 sunk; that the plaintiff maliciously and intentionally caused damage to the vessel San Vicente M and sunk the vessel LCT 787 to bring about their loss in the high seas with the cargoes on board to enable it to collect the proceeds of the insurance on the cargoes which it had overinsured; that the delay in the departure of the vessels from the port of Cebu was not due to the fault of the defendant but to the strike called by the laborers in said port; that it was at the plaintiff's insistence that the vessels made the voyage in the absence of the captain who was confined in the hospital and other ship officers who had not yet arrived from Cebu to avoid investigation by the authorities of the military police, the army and the National Bureau of Investigation and officials of the Surplus Property Commission, and confiscation of the cargoes which had been illegally procured and obtained by the plaintiff; that by reason of the total loss of the vessel LCT 787, any and all claims for the recovery of the value of the plaintiff's cargo on board it had been extinguished; that the defendant had exercised due care and diligence in the operation of the vessels during their voyage from Guiuan, Samar, to Manila, via the port of Cebu; that the deviation to the port of Cebu was with the previous knowledge and consent of the plaintiff and authorized in their contract; and that upon arrival of the vessel San Vicente M in Manila the captain of the vessel filed with the proper authority a marine protest for the damage caused to the vessel San Vicente M and the loss of the vessel LCT 787. The defendant set up against the plaintiff the following counterclaims: P3,100, the balance of the freight due from the plaintiff; P3,600 as demurrage suffered by the defendant by reason of the plaintiff's failure to unload the cargo on board the vessel San Vicente M within nine days after the expiration of 24 hours from the date of arrival thereof in Manila; P1,500 as actual cost of repairs of the vessel San Vicente M damaged by reason of the plaintiff's negligence and recklessness in loading its cargo; P15,000, the actual market value of the sunken and lost vessel LCT 787; P150,000 expected profits from the operation of the sunken and lost vessel LCT 787 for at least ten years; P18,000 expected freightage to be earned by the defendant but lost by reason of the unreasonable restraints on the company arising from the seizure and attachment of its properties at the instance of the plaintiff; P45,000 actual damages sustained by the defendant by reason of the wrongful filing of the complaint and adverse publicity; P120,000 damages for the impairment of the defendant's goodwill; P1,138.31, the cost of unloading and warehousing of the plaintiff's cargo on board the vessel San Vicente M undertaken by the Luzon Brokerage Company, Inc.; and P10,000 attorney's fees, or a total of P367,338.31.
On 29 July 1948 the Luzon Brokerage Company, Inc., after obtaining leave from the court to intervene, filed its complaint in intervention praying that pending hearing of the case, the defendant be directed to surrender to the Court negotiable warehouse warrant No. 4069 covering the cargo deposited in its warehouse, or enjoining it from negotiating the said warrant; and, after trial, judgment be rendered ordering whoever the Court find entitled to the possession thereof, to pay the intervenor the sum of P1,138.31, the cost of hauling and storing it, with interest at the lawful rate from the date of the filing of the complaint in intervention, and, should the party adjudged to be entitled to the possession of the said cargo refuse and fail to pay the amount and interest due, the Court authorize the sale thereof at public auction to satisfy the intervenor's lien.
On 31 July 1948 the plaintiff answered the defendant's counterclaims charging the defendant with negligence and blaming it for the damages it had sustained, denying liability therefor, and praying for dismissal of its counterclaims.
On 9 August 1948 the defendant answered the intervenor's complaint denying liability for the intervenor's claims and praying that the plaintiff be ordered to pay the intervenor's claims.
On 10 August 1948 the plaintiff answered the intervenor's complaint also denying liability for the intervenor's claims and praying that the intervenor's complaint be dismissed.
On 24 December 1949 the plaintiff filed a "motion for discharge of attachment" on the ground that the only property of the defendant attached by the Sheriff was a bank deposit of P20, which is less than the annual premium being paid by the plaintiff on the attachment bond, and prayed for the cancellation of the bond it had theretofore filed and the release of the sureties from liability. On 16 January 1950 the defendant filed an objection thereto on the ground that the bond filed by the plaintiff was to answer for the damages sustained by the defendant as a result of the issuance of the writ of attachment at the plaintiff's instance. On 20 January 1950 the Court denied the plaintiff's motion to dissolve the writ of attachment.
On 21 March 1951 the defendant filed motions for recovery of damages upon the plaintiff's bonds filed to secure the writ of attachment and order directing the seizure of the defendant's personal and other properties. On 27 March 1951 the plaintiff filed its objections thereto.
On 10 January 1952 the Court rendered judgment holding that the plaintiff is not the real party-in-interest to prosecute this action but the Northwest Commercial Corporation, an entity separate and distinct from the plaintiff; and that the plaintiff's causes of action had not been fully established, and dismissing the plaintiff's complaint, the defendant's counterclaims and the complaint in intervention.
On 23 and 24 January 1952 the plaintiff and the defendant filed their respective motions for reconsideration. On 31 January 1952 the plaintiff filed an objection to the defendant's motion for reconsideration; on 2 February 1952 the defendant, a reply thereto.
On 7 February and 2 March 1952 the Court denied the defendant's and the plaintiff's motions for reconsideration.
Both the plaintiff and the defendant have appealed; the intervenor has not.
The errors allegedly committed by the trial court are, according to the plaintiff, as follows:
I. The lower court erred in holding that plaintiff-appellant is not the real party in interest.
II. The lower court erred in holding as immaterial questions raised as to what party should be adjudged responsible for the sinking of the LCT 787.
III. The lower court erred in holding that plaintiff-appellant's causes of action are not well-established.
IV. The lower court erred in dismissing the complaint.
and, according to the defendant, are, to wit:
I. The trial court erred in not holding that by reason of the unreasonable restraints of defendant-appellant company made by the plaintiff-appellant by virtue of the writs of attachment and replevin, defendant-appellant lost P18,000.00 worth of freightage on three (3) sets of cargoes scheduled for shipment.
II. The trial court erred in not declaring that by reason of the wrongful filing of the complaint and the publicity consequent thereto, defendant-appellant lost its good-will and actual customers refused to ship their cargoes through defendant-appellant, causing the latter actual damages in the amount of P45,000.00.
III. The trial court erred in not finding that by reason of the wrongful filing of the complaint, the good-will of the defendant-appellant was impaired, the value of which damage was to the amount of P120,000.00.
IV. The trial court erred in not awarding to the defendant-appellant the amount of P10,000.00 as attorney's fees.
Both the plaintiff and the defendant have raised questions of fact and have reduced their total claims against each other to P85,000 and P193,000, respectively. In Sambranno vs. Rehabilitation Finance Corporation, G.R. No. L-13300, 30 April 1960, and Rio Y Cia. vs. Vasquez, G.R. No. L-12097, 19 July 1960, it was the separate total claims of the respective parties and not the combined claims against each other, that determined the appellate jurisdictional amount. The value, therefore, of the controversy in the case at bar is less than P200,000.
Pursuant to section 31, in connection with sections 17 and 29, Republic Act No. 296, as amended, the case is remanded to the Court of Appeals for determination and judgment.
Bengzon, C.J., Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Paredes and De Leon, JJ., concur.
Barrera and Dizon, JJ., took on part.
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