INSURANCE COMPANY OF NORTH AMERICA, PLAINTIFF AND APPELLEE, VS. MARITIME COMPANY OF THE PHILIPPINES, ET AL., DEFENDANTS, MANILA PORT SERVICE AND/OR MANILA RAILROAD COMPANY, DEFE…

BENGZON, J.:


This is an appeal, from a decision of the Court of First Instance of Manila, raising a question purely of law.

Standard T Chemical Co., Inc., on March 16, 1962, shipped from New
York aboard SS “Philippine Bataan” 1,300 packages of raw materials for
paint manufacture, consigned to Ed. A. Keller & Co., Ltd., in
Manila. SS “Philippine Bataan” arrived in Manila on May 10, 1962 and
immediately began to discharge the afore-stated shipment to the custody
of the Manila Port Service as arrastre operator. Alleging that the
cargo sustained loss and/or damage, the consignee, through its broker,
thereafter filed on the same day, May 10, 1962, a provisional claim
with the arrastre operator. Three days later, on May 13, 1962, the last
package of the abovementioned cargo was discharged from the carrying
vessel.

A bad order examination was made on August 14, 1962 at Ed. A. Keller
& Co., Ltd.’s request. It showed that two drums and 13 bags of raw
materials for the manufacture of paint had been damaged. A formal claim
was thereupon filed by said consignee on August 23, 1962 with the
arrastre operator in a total amount of P3,171.82 (Exh. D).

As the Manila Port Service did not pay, Ed. A. Keller & Co.,
Ltd., on November 8, 1962 , received payment, in the sum of P4,473.44,
from the Insurance Company of North America , its insurer on the cargo.

Suing as subrogee of the consignee, Insurance Company of North
America, on May 6, 1963, filed the complaint in this case against the
Maritime Company of the Philippines (operator of SS “Philippine
Bataan”), the Manila Port Service and/or the Manila Railroad Company
(the Port Service being the latter’s subsidiary).

The defendants Manila Port Service and Manila Railroad Company, in
their answer filed on June 15, 1962, interposed the defense of
non-compliance of the 15-day period for the filing of a claim mentioned
by Section 15 of the Arrastre-Management Contract.

Rendering judgment on January 8, 1964, the trial court absolved the
Maritime Company of the Philippines from liability for want of positive
proof against it of the extent of damage suffered by the cargo. It
however ordered the Manila Port Service to pay its maximum liability of
P500 under its contract, plus interest and costs, rejecting its
contention that the provisional claim filed on May 10, 1962 was
premature. From this decision only the defendants Manila Port Service
and Manila Railroad Company appealed; plaintiff did not appeal.

Appellants contend that the provisional claim did not comply with
the proviso of Section 15 of the Arrastre-Management Contract requiring
that it be filed “within fifteen (15) days from the date of discharge
of the last package from the carrying vessel.” The same was filed, as
stated earlier, during the discharge, but three days before the
date of discharge of the last package from the carrying vessel. And so,
in appellants’ view, the provisional claim was filed before the 15-day
period period for filing it started to run, thereby making it
premature.

Appellants’ contention is not tenable.

The purpose of the 15-day period is to give the arrastre operator
reasonable opportunity to check the validity of the claim while the
facts are still fresh in the minds of the persons who took part in the
transaction and while the pertinent documents are still available
(Consunji v. Manila Port Service, L-15551, November 29, 1960).

In the present case, said purpose had been served. The provisional
claim was filed after some of the goods had been discharged into the
custody of the arrastre operator. The consignee, upon learning that the
goods already discharged sustained loss or damage, immediately filed
the provisional claim without waiting for the rest of the goods to be
discharged. Such a claim is timely, not premature, ^[1] in contrast to a provisional claim filed before the arrival of the vessel ^[2]
or during the discharge of the goods but before the consignee or his
broker had discovered or been informed of an actual shortage or damage
to the goods. ^[3]

The rule to follow – in cases like this where a strict and literal
application of the proviso of Section 15 aforestated would not serve
its purpose – is that stated in Yu Kimteng Construction Corp. v. Manila
Port Service, L-17027, November 29, 1965 . This Court ruled therein
that “the period of 15 days within which a claim should be filed with
the Manila Port Service should commence, not from the date of discharge
of the goods from the carrying vessel, but from the date the consignee
or claimant learns of the loss, damage or misdelivery for which the
claim is made.” As the court a quo rightly pointed out, since
the consignee had knowledge on the same day of discharge of damage to
the cargo, the immediate filing of the claim was a sign of diligence
and should have been welcomed by the Manila Port Service rather than
rejected, for it gave the arrastre operator fair warning of the damage.

WHEREFORE, the judgment appealed from is hereby affirmed, without costs in this instance.

SO ORDERED.

Concepcion, C.J., Reyes, JBL, Dizon, Regala, Makalintal, Zaldivar, Sanchez, and Ruiz Castro, JJ., concur.
Barrera, J., no part.

^[1] See Switzerland General Insurance Co., Ltd. v. Java Pacific & Hoegh Lines, et al., L-21760, April 30, 1966.

^[2] Shell Co. of the Phil. v. Cia. General de Tabacos, L-20230, July 30, 1965 .

^[3] New Hampshire Fire Ins. Co. vs. Manila Port Service, L-20938.