G.R. No. 1837. September 05, 1905

It was the practice of the Quartermaster’s Department of the United
States Army in Manila in the years 1899 and 1900 to solicit proposals
for the furnishing of cascoes and lorchas of which it had need and to
make a contract with the best bidder for such number of cascoes and
lorchas as it might require for a period of six months.

Pursuant to this practice, prior to the 1st day of July, 1900, it
solicited proposals, and the defendant submitted the best proposition.
His bid was accepted, and on the 7th of July, 1900, a contract was made
between him and the Quartermaster’s Department for the furnishing of
four lorchas and sixty cascoes, the Quartermaster’s Department having
the right to increase the number by 30 per cent upon twenty-four hours’
notice. The price to be paid for the rent of the cascoes and lorchas
was stated in the contract, and it was provided as follows:

“Y cualquier averia que ocurriese durante el
servicio del Departamento del Quartermaster E. U. A. sin culpa del
dueno o de su propietario, seran reparados a cuenta de los Estados
Unidos (exceptuando la accion de los elementos) durante el tiempo que
la embarcacion estuviese en reparacion, se abonara la mitad del precio
del contrato, entendiendose que a este precio arriba marcado incluye
todos los gastos de la tripulacion, etc.”

The defendant for some time prior to July, 1900, had furnished
cascoes and lorchas to the Government under similar contracts. He did
not himself own the cascoes and lorchas which he so furnished, but it
was his custom to get them from different persons who owned them, and
turn them over to the Government. The plaintiff was the owner of casco
No. 1931, which on the 5th day of September, 1900, he turned over to
the defendant, and the defendant placed it in the service of the
Government under his aforesaid contract. On the 31st day of October of
the same year the casco was lost in the bay during a typhoon, and this
action is brought to recover its value.

The question in this case is, What was the contract between the
plaintiff and the defendant, under which plaintiff turned the casco
over to defendant? The plaintiff alleged in his complaint that on the
5th day of September he made a verbal contract with the defendant by
the terms of which defendant expressly agreed to pay any damages which
the casco might suffer while in his possession, and he testified at the
trial that such a contract was made. He also produced two witnesses in
support of his testimony. The defendant denied that he had made any
such contract with the plaintiff in reference to this particular casco.
The first witness for the plaintiff upon cross-examination testified
that he was not present when the alleged contract was made between the
plaintiff and the defendant, but was in an adjoining room. He testified
that he knew that the defendant made the same contract with the
plaintiff that he made with “all the rest of us.” We think it apparent
that the testimony of this witness is of no value, for witnesses were
produced by both parties who were owners of cascoes, and who had turned
them over to the defendant in the same way that the plaintiff turned
over his, and they differed radically as to what the exact contract
between them and the defendant was. The other witness who supported the
claim of the plaintiff that there was a special contract in regard to
this particular casco testified that he heard the conversation between
the plaintiff and the defendant, and that it was carried on in Spanish.
It appears that the plaintiff speaks English, and at the time in
question was acting as English and Spanish interpreter in the office of
the quartermaster who had charge of these cascoes and lorchas, and the
defendant testified that he never conversed with the plaintiff in
Spanish, but always in English.

It appeared in the evidence that it was the custom of the principal
owners of cascoes and lorchas to meet in the office of the defendant
prior to the time of submitting bids, and agree upon the price which
the defendant was to offer. It also appears that the defendant paid to
the owners of the cascoes the amount which he received from the
Government, less a certain sum which, with the total amount paid by the
Government, depended upon the tonnage of the casco. The contract
between the defendant and the Government provided that the latter
should pay 13.90 pesos daily for cascoes of from 20 to 30 tons, and
24.60 pesos for those of from 30 to 45 tons. The casco of the plaintiff
came within the latter class, and the Government paid to the defendant
for its use 24.60 pesos daily, and he paid to the plaintiff 23 pesos.
When the casco was being repaired by the Government, defendant received
80 cents daily of the amount paid by the Government. As has been said,
the plaintiff during the time in question was employed in the office of
the quartermaster, and was thoroughly informed of the contract between
the defendant and the Government, and when he turned over his casco to
the defendant he knew that it was to be placed by the defendant in the
service of the Government under the contract in question.

We are satisfied that there was no express contract whatever between
the parties, and the claim of the plaintiff to the contrary is not
supported by the evidence. The defendant’s claim is that he acted as
mere agent for the owners of the cascoes—as an intermediary between
them and the Government, and for his services in so acting received
this commission which has been above mentioned. This, perhaps, was the
real nature of his undertaking, but the evidence shows that as between
himself and the Government he was an independent contractor, and the
Government had no dealings whatever with the owners of the cascoes. We
think, also, that the contract between the defendant and the owners of
the cascoes was also one of hiring, but the question still remains,
What were the terms of that contract?

After a consideration of all the evidence in the case and of all the
circumstances which surrounded the transaction, we hold that the
plaintiff and other owners of cascoes, in their tacit contract with the
defendant, adopted the terms of the contract between the defendant and
the Government, and that the only element in the contract between the
defendant and the plaintiff which did not appear in the contract
between the defendant and the Government was the amount which the
defendant was to receive from the sum paid by the Government. In all
other respects the evidence shows that the contract between the
defendant and the plaintiff was exactly the same as the contract
between the defendant and the Government. For example, when the casco
was in process of repair, the plaintiff received one-half of the total
rental, instead of the whole, and yet it is not claimed by the
plaintiff that there was any special contract between himself and the
defendant which provided for this arrangement. It is reasonable to
believe that as to the loss of the casco the parties adopted the
provisions of the contract between the defendant and the Government. It
appears that the plaintiff was bound to and did furnish the crew of the
casco. The plaintiff knew that the casco was to be placed in the
service of the Government under this contract. If the casco was lost or
damaged, the plaintiff knew that the loss would be caused either by the
fault of his own crew or by fault of the Government. He knew that in no
event could it be lost by the fault of the defendant. It appeared in
evidence that after the casco was turned over by the defendant to the
Government, the defendant had no control over it. He had no right to
interfere in its management. The plaintiff testified that on the day on
which the casco was lost the third typhoon signal had been hoisted, and
that he went to the defendant and asked him to send a launch into the
bay to bring the casco into the river, and that the defendant promised
to do so. The defendant testified that he had no recollection of any
such conversation and was satisfied that it did not take place, because
he had no right to interfere in the management of the casco; that it
was under the control of the Government and plaintiffs crew, and he was
powerless to act.

The appellant presents another question concerning a default
judgment entered against the defendant, which was afterwards vacated,
and claims that the vacating of this default judgment, and allowing the
defendant to answer, was error. It appears that summons was legally
served upon the defendant, and that he did not answer within the time
required by law. It appears by the affidavit of the defendant that he
never received the summons, and knew nothing at all about the suit
until just prior to the time when he made the application for leave to
answer. Both of these statements may be true, for by the provisions of
section 396, paragraph 6, of the Code of Civil Procedure, a summons may
be served upon the defendant by leaving a copy at his usual place of
residence, in the hands of some person resident therein of sufficient
discretion to receive the same. The bill of exceptions does not show
how the summons was served in this case, whether upon the defendant
personally or by leaving it at his house. If in the latter way it may
never have come to his attention, and if it did not, as his affidavit
shows that it did not, it made a proper case for the opening of the
default and the presentation of an answer.

The judgment of the court below is affirmed, with the costs of this
instance against the appellant, and after the expiration of twenty
days, judgment will be entered in accordance herewith, and the case
remanded to the court below for execution of said judgment.

Arellano, C. J., Torres and Carson, JJ., concur.
Johnson, J., dissents.