THE GOVERNMENT OF THE PHILIPPINE ISLANDS, PLAINTIFF AND APPELLANT, VS. THE INSULAR MARITIME CO., DEFENDANT AND APPELLEE.

MALCOLM, J.:



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}The Government of the Philippine Islands seeks by this action to recover from
The Insular Maritime Company the sum of P30,437.91 for repairs made by
the Bureau of Commerce and Industry on the motor ship Insular.

The Insular Maritime Company was organized with a capital of
P150,000. It became the owner of one vessel only, the Insular, valued
at P150,000. On October 29, 1919. The Insular Maritime Company asked
the Bureau of Commerce and Industry to perform certain repairs on the
Insular. The Government consented and terminated said Government of the
P. I. vs. Insular Maritime Co. repairs on November 29 of the
same year. Subsequent thereto, on April 15, 1920, the Insular suffered
a total loss by fire.

The bill prepared by the chief accountant of the Bureau of Commerce and
Industry for work done on the motor ship Insular in the amount of
P30,437.91, was dated July 31, 1920. Collection of the claim was attempted
pursuant to formal demand made by the Acting Insular Auditor of date
April 30, 1921.

It will thus be noted, as was emphasized by the defense and by His Honor, the
trial judge, that no steps were taken by the Government to secure payment for
the repairs until after the loss of the vessel Insular. The first error
assigned by the Attorney-General addressed to this finding of fact is
accordingly without merit.

The trial, judge further found in effect, as a legal conclusion, that the
loss of the vessel Insular extinguished the obligation. The
Attorney-General challenges the correctness of this view.

The decision of the trial judge was predicated on his understanding of the
provisions of article 591 of the Code of Commerce in relation with other
articles of the same Code, and with the decision of this court in the case of
Philippine Shipping Co. vs. Garcia Vergara [1906], 6 Phil., 281). As to
the applicability of article 591 of the Code of Commerce, there is nothing in
the language to denote that the liability of the owners of a vessel is wiped out
by the loss of that vessel. As to the applicability of the decision in the case
of Philippine Shipping Co. vs. Garcia Vergara, supra, the facts are not
the same. There, the owners and agents of a vessel causing the loss of another
vessel by collision were held “not liable beyond the vessel itself causing the
collision,” but were “not required to pay such indemnification for the reason
that the obligation thus incurred has been extinguished on account of the loss
of the thing bound for the payment thereof.” Here, there is a contractual
relation which remains unaffected by the loss of the thing concerned in the
contract and which is governed principally by the provisions of the Civil
Code.

The rights and liabilities of owners of ships are in many respects
essentially the same as in the case of other owners of things. As a general
rule, the owners of a vessel and the vessel itself are liable for necessary
repairs. Naturally the total destruction of the vessel extinguishes a maritime
lien, as there is no longer any res to which it can attach. But the total
destruction of the vessel does not affect the liability of the owners for
repairs on the vessel completed before its loss.

It is but fair to say that what has been stated in this decision more
accurately expresses the consensus of opinion in the court than it does the
views of the writer, who sees more in the appellee’s case than do his colleagues
in the court.

The trial court was accordingly right in its exposition of the facts but not
in its application of the law. Judgment must therefore be as it is hereby
reversed, and in lieu of the judgment appealed from, another shall be entered
here in favor of the plaintiff and against the defendant for the sum of
P30,437.91 with legal interest from July 20, 1921, when the complaint was
presented, until payment. Without special finding as to costs in either
instance, it is so ordered.

Araullo, C. J., Johnson, Street, Avancena, Ostrand, Johns, and
Romuadez, JJ., concur.