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Yu Con vs. Ipil | Araullo (1916)

FACTS

Respondent, Yu Con (Yu Con), chartered the banca “Maria” – owned by petitioner Narciso Lauron (Lauron) with Gilcerio Ipil (Ipil) as its master and Juto Solamo (Solamo) as it supercargo – to transport certain merchandise and money from the port of Cebu to Catmon.

Yu Con loaded the merchandise and delivered the money, placed in a trunk, to Ipil and Solamo.

Allegedly because there was no more room for Yu Con’s trunk, Ipil and Solamo transferred the money to their own trunk in the stateroom.

Before the ship could sail, the trunk and the money placed therein disappeared.

ISSUES/HELD

Are the petitioners liable for the loss? – YES. RATIONALE

It is therefore beyond all doubt that the loss of the money occurred through the manifest fault and negligence of Ipil and Solamo. o They failed to take the necessary precautions in order that the stateroom

containing the trunk in which they kept the money should be properly guarded by members of the crew and they also did not expressly station some person inside the stateroom for the guarding and safe-keeping of the trunk.

o All of these circumstances, together with that of its having been impossible to know who took the trunk and the money, make the conduct of Ipil, Solamo, and the other crew members eminently supicious and prevent our holding that the disappearance or loss of the money was due to a fortuitous event, to force majeure.

Ipil and Solamo were depositaries of the sum in question and, having failed to exercise the diligence required by the nature of the obligation of safe-keeping assumed by them and by the circumstances of the time and the place, it is evident that they are liable for its loss or misplacement and must restore it.

With respect to Lauron, he is also liable in accordance with the provisions of the Code of Commerce in force because, as the proprietor and owner of the vessel who executed a contract of carriage with Yu Con, there occurred the loss, theft, or robbery of the P450 that belonged to Yu Con through the negligence of Ipil and Solamo and which theft does not appear to have been committed by a person not belonging to the craft.

The old Code of Commerce absolved the shipowner from liability for the negligence of the captain and its crew but, in the light of the principles of modern law, this doctrine on the non-liability of the shipowner for the unlawful acts, crimes or quasi crimes, committed by the captain and the crew can no longer be maintained in its absolute and categorical terms. o In maritime commerce, the shippers and passengers in making contracts

with the captain do so through the confidence they have in the shipowner

who appointed him; they presume that the owner made a most careful investigation before appointing him, and, above all, they themselves are unable to make such an investigation, and even though they should do so, they could not obtain complete security, inasmuch as the shipowner can, whenever he sees fit, appoint another captain instead.

o Thus, it is only proper that the shipowner should be made liable. Coastwise Lighterage Corporation vs. Court of Appeals | Francisco (1995) FACTS

Pag-asa Sales Inc. (Pag-asa) contracted with petitioner, Coastwise Lighterage Corporation (Coastwise), to transport molasses from Negros

Occidental to Manila. Upon arriving in Manila Bay, one of the barges used struck a sunken object

which caused water to leak in through a hole. The molasses was contaminated and rendered unfit for the use it was

intended. Pag-asa filed a claim with and was paid by respondent, Philippine General

Insurance Company (Philgen). Philgen then filed an action before the RTC; the latter ruled in favor of

Philgen and this decision was affirmed by the CA. Hence, this petition. ISSUES/HELD

Was Coastwise transformed to a private carrier by virtue of the contract of affreightment? – NO.

Did Coastwise exercise the necessary diligence? – NO. Was Philgen subrogated to the rights of Pag-asa? – YES. RATIONALE

1ST ISSUE Although a charter party may transform a common carrier into a private

one, the same however is not true in a contract of affreightment on account of the distinctions between the two. o Under the demise or bareboat charter of the vessel, the charterer

will generally be regarded as the owner for the voyage or service stipulated but to create a demise, the owner of a vessel must completely and exclusively relinquish possession, command and navigation thereof to the charterer, anything short of such a complete transfer is a contract of affreightment (time or voyage charter party) or not a charter party at all.

o On the other hand, a contract of affreightment is one in which the owner of the vessel leases part or all of its space to haul goods for others and under such contract the general owner retains the possession, command and navigation of the ship, the charterer or freighter merely having use of the space in the vessel in return for

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his payment of the charter hire.

The nature of the contract as an affreightment is apparent and this is bolstered by the admission that Coastwise has made; as such, it has not been transformed into a private carrier.

2ND ISSUE Being a common carrier, Coastwise failed to exercise extraordinary diligence. Coastwise violated Art. 6091 of the Code of Commerce, which

subsidiarily governs common carriers, by embarking on a voyage with an unlicensed patron, Jesus R. Constatntino. o It cannot safely claim to have exercised extraordinary diligence, by

placing a person whose navigational skills are questionable, at the helm of the vessel which eventually met the fateful accident.

o It may also logically, follow that a person without license to navigate, lacks

not just the skill to do so, but also the utmost familiarity with the usual and safe routes taken by seasoned and legally authorized ones.

3RD ISSUE Upon payment by PhilGen to Pag-asa, the former was subrogated into

all the rights which Pag-asa may have had against the carrier, Coastwise. o If the insured property is destroyed or damaged through the fault or

negligence of a party other than the assured, then the insurer, upon payment to the assured will be subrogated to the rights of the assured to recover from the wrongdoer to the extent that the insurer has been obligated to pay.

o Payment by the insurer to the assured operated as an equitable assignment to the former of all remedies which the latter may have against the third party whose negligence or wrongful act caused the loss.

Inter-Orient Maritime Enterprises, Inc. vs. NLRC | Feliciano (1994) RATIO DECIDENDI

A ship’s captain must be accorded a reasonable measure of discretionary authority to decide what the safety of the ship and of its crew and cargo specifically requires on a stipulated ocean voyage. FACTS

Captain Tayong was hired by Trenda World Shipping and Sea Horse Ship Management through Inter-Orient Maritime Enterprises for a period of 1 year.

He took command of Inter-Orients vessel in Hong Kong. o He was instructed to replenish bunker and diesel fuel, to sail forthwith to

Richard Bay, South Africa, and there to load 120, 000 metric tons of coal.

1 Art. 609. — Captains, masters, or patrons of vessels must be Filipinos, have legal capacity to contract in accordance with this code, and prove the skill capacity and qualifications necessary to command and direct the

vessel, as established by marine and navigation laws, ordinances or regulations, and must not be disqualified according to the same for the discharge of the duties of the position….

Since a storm would hit Hong Kong, precautionary measures were taken to

secure the vessel’s safety considering that the turbo-charger was leaking and the vessel was 14 years old.

Captain Tayong followed-up the requisition by the former Captain for supplies of oxygen and acetylene, necessary for the welding-repair of the turbo-charger and economizer.

The vessel sailed to Singapore. o On the way to Singapore, the vessel stopped in the middle of the ocean for 6

hours and 45 minutes due to a leaking economizer. o He was instructed to shut down the economizer and use the auxiliary boiler

instead. When the vessel arrived in Singapore, the Chief Engineer reminded Captain

Tayong that the oxygen and acetylene supplies had not been delivered. o Upon inquiry, the Captain was informed that the supplies could only be

delivered on Aug. 1 as the stores had closed. Captain Tayong called the shipowner, Seahorse Ship Management and informed

them that the departure of the vessel for South Africa may be affected because of the delay in the delivery of the supplies. o He was advised to contact Mr. Clark, the Technical Director. o According to Mr. Clark, after being informed that the ship cannot travel

without the supplies, Captain Tayong agreed with him when he said by shutting off the water to the turbo chargers and using the auxiliary boilers, there should be no further problem.

o According to Captain Tayong, he was informed by Sea Horse to wait for the supplies.

Captain Tayong immediately sailed for South Africa upon the delivery of the supplies.

Upon reaching South Africa, Captain Tayong was instructed to turn-over his post to the new captain. He was thereafter repatriated to the Philippines. o He was not informed of the charges against him.

He then instated a complaint for illegal dismissal. ISSUES/HELD

WoN Captain Tayong was illegally dismissed? – YES. RATIONALE

Confidential and managerial employees cannot be arbitrarily dismissed at any

time, and without cause as reasonably established in an appropriate investigation. o They are also entitled to security of tenure, fair standards of employment

and the protection of labor laws. The captain of a vessel is a confidential and managerial employee. A captain commonly performs 3 distinct roles: (1) he is a general agent of the

shipowner; (2) he is also commander and technical director of the vessel; and (3) he is a representative of the country under whose flag he navigates.

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o The most important is the role performed by the captain as the commander

of the vessel. Such a role analogous to that of ―Chief Executive Officer‖ of a present-day corporate enterprise.

A ship’s captain must be accorded a reasonable measure of discretionary authority to decide what the safety of the ship and of its crew and cargo specifically requires on a stipulated ocean voyage. o The captain is held responsible for such safety.

The captain has control of all departments of service in the vessel, and reasonable discretion as to its navigation.

It is the right and duty of the captain, in the exercise of sound discretion and in good faith, to do all things with respect to the vessel and its equipment and conduct of the voyage which are reasonably necessary for the protection and preservation of the interests under his charge.

o It is a basic principle of admiralty law that in navigating a merchantman, the master must be left free to exercise his own best judgment.

o The requirements of safe navigation compel us to reject any suggestion that the judgment and discretion of the captain of a vessel may be confined within a straight jacket.

The master is entitled to delay for such a period as may be reasonable under the circumstances.

Captain Tayong had reasonable grounds to believe that the safety of the vessel and crew required him to wait for the delivery of the supplies needed. o The vessel had stopped mid-ocean for 6 hours and 45 minutes on its way to

Singapore because of its leaking economizer. o Captain Tayong did not maliciously and arbitrarily delay the voyage to South

Africa. The decision of Captain Tayong did not constitute a legal basis for his summary

dismissal. Yu Biao Sontua & Co. vs. Ossorio | Romualdez (1922) FACTS

On March 12, 1920, 2K cases of petroleum and 8,473 cases of gasoline were loaded in the motor boat Alfonso o The loading was done without the permission from the customs authorities o The cases were loaded by means of straps supporting 10-12 cases at a

time o The cases were placed in the hold of the ship, which is 14ft from the

boiler of the main engine and 4ft from the boiler of the smaller engine On March 13, the smaller engine was in operation preparatory to the departure Subsequently, a fire broke out with an explosion on board Alfonso followed by a

violent expulsion of gasoline and petroleum Due to the magnitude of the fire and the inflammability of the materials and the

proximity of the steamer Y. Sontua, the fire spread to the said steamer Sontua brought this action to recover from Ossorio, the owner of Alfonso,

alleging that the damages were due to the negligence of the agents and employees of Ossorio

Ossorio contended that the damages were caused by a fortuitous event and are

not imputable to his or any of his agents’/employees’/mandataries’ negligence CFI ruled in favor of Sontua and held that:

o The explosion was due to the negligence of the persons in charge of Alfonso o Ossorio is liable for the negligence of his agents and employees

ISSUES/HELD

WoN the explosion was due to the negligence of the persons in charge of Alfonso? – YES.

WoN Ossorio, the owner of the motorboat, was liable for the negligence of his agents and employees? – YES.

RATIONALE

Issue #1 Expert testimony introduced by Sontua shows the explosion and fire, which

caused the damages, are imputable to the negligence of the persons having charge of Alfonso at that time. It was shown that: o Due to the manner by which the cases were loaded, the cases would receive

bumps resulting in damage to the cans and consequent leakage (use of straps)

o The gases formed by the volatilization are apt to accumulate in a compartment without sufficient ventilation (hold of a ship)

o This accumulation will cause the gases to ignite upon comin gin contact with a spark or upon temperature being sufficiently raised (smaller engine was in operation)

Issue #2 The rule is that where the vessel is one of freight, a public concern or

public utility, it owner or agent is liable for the tortuous acts of his agents

The Code of Commerce further provides that the general liability of a vessel owner extends to losses by fire arising from other than a natural or other excepted cause, whether occurring on the ship, or communicated from other vessel, or from the shore. This means that losses by fire are not within the exceptions (act of God or peril of the sea except by local custom) UNLESS proximately caused by one of the exceptions

Re: allegation that obligations under Art. 612 of the Code of Commerce are inherent in the master, the SC said that although such duties are inherent to the master, it does not

Wallem Maritime Services, Inc. vs. NLRC | Romero (1996) FACTS

Private respondent Macatuno was hired by Wallem Shipmanagement Limited thru its local manning agent, Wallem Maritime Services, Inc., as a seaman on board the M/T Fortuna

While the vessel was berthed at the port of Kawasaki, Japan, an altercation took place between Macatuno and a fellow Filipino, Gurimbao on the one hand, and a

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cadet/apprentice officer of the same nationality as the captain of the vessel on

the other hand. when both were on duty, the apprentice approached them and told Gurimbao to

drain the water mixed with oil and dirt w/c had accumulated at the upper deck of the vessel, using a shovel. Gurimbao told him that throwing oil and water was prohibited by Japan’s laws but the apprentice got mad and ordered Gurimbao to use a hose to siphon off the water. Gurimbao did as he was told to avoid trouble. Gurimbao complained to Macatuno about the ―improper and unauthorized act‖ of the apprentice. They reminded the apprentice that he wasn’t an officer of the vessel and thus, he had no right to order any member of the crew. The apprentice reacted violently. Macatuno pushed twice the apprentice’s chest whil Gurimbao mildly hit his arm. The apprentice ran to the captain who witnessed the incident from his window

The master entered the incident in the tanker’s logbook As a result, Macatuno and Gurimbao were repatriated to the Philippines where

they immediately filed separate complaints for illegal dismissal with the POEA Petitioners alleged that the incident wasn’t the first infraction committed by the

two. The logbook showed that while the vessel was docked in Batangas, they left it during working hours w/o permission. Also, while the vessel was achored in Kawasaki, Japan, they assaulted the officer on watch for the day. When the vessel was about to sail that day, the two went ashore despite the warning given them. They were arrested by Japanese authorities.

POEA ruled that the dismissal was without just and valid cause. It didn’t give much weight to the ―Certified true copy of the official logbook‖ because the alleged entries were only handpicked and copied from the official logbook.

There’s no way to verify the truth of the entries. NLRC affirmed POEA’s decision ISSUES/HELD

WON Macatuno was validly dismissed based on the entries in the logbook? – NO. RATIONALE

An employer may dismiss or lay off an employee only for the just and authorized causes under Art. 282 and 283 of the LC. The ship captain’s logbook is a vital evidence as Art. 612 of the Code of Commerce requires him to keep a record of the decisions he had adopted as the vessel’s head. In Haverton Shipping v. NLRC, it was held that a copy of an official entry in the logbook is legally binding and

serves as an exception to the hearsay rule. An employer may dismiss or lay off an employee only for the just and authorized

causes under Art. 282 and 283 of the LC. The ship captain’s logbook is a vital evidence as Art. 612 of the Code of Commerce requires him to keep a record of the decisions he had adopted as the vessel’s head. In Haverton Shipping v. NLRC, it was held that a copy of an official entry in the logbook is legally binding and serves as an exception to the hearsay rule.

However, the Haverton Shipping ruling does not apply in this case. In Haverton Shipping, there was an investigation of the incident which led to the seaman’s dismissal before he was dismissed. Thus, the facts in the logbook were supported

by facts from the investigation. In this case, there was no investigation

conducted by the ship captain before the repatriation so the contents of the logbook have to be duly indentified and authenticated lest an injustice result from the blind adoption of such contents which just serve as prima facie evidence of the incident.

In Haverton Shipping, what was presented was a copy of the official entry from the logbook itself. In this case, petitioners didn’t submit as evidence to the POEA the logbook itself or even authenticated copies of the relevant pages which could have been easily photocopied. What was offered in evidence was just a typewritten collation of excerpts from what COULD be the logbook because by their format, they could have been lifted from other records kept in the vessel in accordance with Art. 612 of the Code of Commerce.

Moreover, the alleged entry in the logbook states that the apprentice officer was

attacked and assaulted. However, under the Table of Offenses and Corresponding Administrative Penalties in the contract of employment, the offense falls under insubordination which may constitute assaulting a superior officer. An apprentice officer cannot be considered a superior officer since he is bound in the form of law to a master. He is just a learner or a trainee.

The entry in the logbook is also so sketchy that, unsupported by other evidence, it leaves so many questions unanswered. In the absence of a more detailed narration in the logbook entry of the circumstances surrounding the alleged assault, the termination of Macatuno cannot be held justified.

Wildvalley Shipping Co., LTD. vs. Court of Appeals | Buena (2000) FACTS

Philippine Roxas, a vessel owned by respondent Philippine President Lines, Inc. (PPL), arrived in Puerto Ordaz, Venezuela, to load iron ore

Mr. Ezzar del Valle Solarzano Vasquez, an official pilot of Venezuela, was designated by the harbor authorities in Puerto Ordaz to navigate the vessel through the Orinoco River

The master (captain) of the vessel, was at the bridge together with the pilot (Vasquez), the officer on watch, and a helsman when the vessel left the bridge when the vessel was under way

Vessel experience some vibrations when it entered the San Roque Channel Vessel proceeded on its way, with the pilot assuring the watch officer that the

vibration was a result of the shallowness of the channel

Vessel again experienced some vibrations, watch officer called the master to the bridge

―Master checked the position of the vessel and verified that it was in the center of the channel, went to confirm or set down the position of the vessel, and ordered the Chief Officer of the vessel to check all the double tanks

Then the vessel ran aground in the Orinoco River, obstructing the ingress and egress of vessels

As a result of the blockage, the Malandrinon, a vessel owned by petitioner Wildvalley, was unable to sail out of Puerto Ordaz on that day

Wildvalley filed suit against PPL and Pioneer insurance (insurer of the vessel) for

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damages in the form of unearned profits and interest thereon

RTC held in favor of Wildvalley, finding negligence of the Master CA reversed the decision hence the appeal ISSUES/HELD

Is PPL liable for damages because of negligence of its Master? – NO. RATIONALE

Since there is no contractual obligation, herein respondent is obliged to give only the diligence required of a good father of a family in accordance with article 1173 of the NCC

The respondent exercised such diligence when: o The vessel sailed only after the main engine, machineries, and other

auxiliaries were checked and found to be in good running condition o The Master left a competent officer to watch on the bridge with a pilot who

is experienced in navigating the Orinoco River o The Master ordered the inspection of the vessel’s double bottom tanks when

the vibrations occurred anew According to sections 11 and 32 of the Rules and Regulations Governing Pilotage

Services as well as Art. 612 of the Code of Commerce, ―the master remains the overall commander of the vessel even when there is a pilot on board. He remains in control of the ship as he can still perform the duties conferred upon him by law despite the presence of a pilot who is temporarily in charge of the vessel. It is not required of him to be on the bridge while the vessel is being navigated by a pilot

HOWEVER, Section 8 of Philippine Ports Authority Administrative Order No. 03-85

provides: o For entering a harbor and anchoring thereat, or passing through rivers or

straits within a pilotage district, as well as docking and undocking at any pier/wharf, or shifting from one berth or another, every vessel engaged in coastwise and foreign trade shall be under compulsory pilotage

Orinoco River being a compulsory pilotage channel necessitated the engaging of a pilot who was presumed to be knowledgeable of every shoal, bank deep, and shallow ends of the river

Pilot Vasquez testified that he: o Is an official pilot in the Harbor at Port Ordaz, Venezuela o Had been a pilot for 12 years o Had experience in navigating the waters of the Orinoco River o Is very familiar with the configuration of the river as wel as the course

headings o Does not even refer to river charts when navigating the Orinoco River

The law does provide that the master can countermand or overrule the order or command of the Harbor Pilot on board but the Master deemed it best not to order the pilot to stop th vessel because the latter had assured him that they were navigating normally before the grounding of the vessel

―Licensed pilots, enjoying the emoluments of compulsory pilotage are in a different class from ordinary employees, for they assume to have a skill and a

knowledge of navigation in the particular waters over which their licenses extend superior to that of the master‖

The grounding of the vessel is attributable to the pilot o In his experience as a pilot, he should have been aware of the portions

which are shallow and which are not, and his failure to determine the depth of the said river and his decision to plod on his set course, in all probability, caused damage to the vessel

In the case of Homer Ramsdell Transportation Company vs. La Compania Generale Transatlantique o ―The master of a ship, and owner also, is liable for any injury done by the

negligence of the crew employed in the ship, the same doctrine will apply to the case of a pilot employed by the master or owner…but if it is compulsive upon the master to take a pilot, and, a fortiori, if he is

bound to do so under penalty, then, and in such case, neither he nor the owner will be liable for injuries occasioned by the negligence of the pilot, for in such a case the pilot cannot be deemed properly the servant of the master or the owner…‖

Res Ipsa Loquitur does not apply since there was a temporary shift of control over the ship from the master, the requisites of negligence and control are absent

The vessel was not unseaworthy as evidenced by the Lloyd’s Register of Shipping confirmed the same

Ohta Development Co. vs. Steamship “Pompey” | Avancena (1926)

FACTS

Ohta Development Co. was the owner of a pier in Davao. On this pier were two groups of posts, three to a group, about 2 feet from the pier itself, which served as a protection to the pier against the impact of vessels.

The steamship Pompey, in command of Captain Galvez, in the name of ―The National Coal Company,‖ was carrying cargo consisting principally of flour and rice for Ohta, docked alongside the said pier.

The ship docked with her bow facing towards the land; and fastened her ropes to the posts on the pier. The evidence shows that, previously, other ships docking alongside the said pier had the bow facing towards the land and fastened a rope to a tree situated on the beach, a precaution taken to avoid the ship from getting too close to the pier.

When the Pompey docked, she did not stretch a rope to the tree on the shore, neither did she drop her bow anchors. After being thus docked they proceeded to unload the flour and rice.

The work of discharging and the hauling of the cargo to the warehouse of Ohta was done without any interference on the part of Ohta and exclusively by laborers and the crew the ship.

There being only 15 or 20 laborers engaged in the hauling, a large amount of cargo accumulated on the dock, with the result that the pier sank with all the merchandise.

RTC: sentenced Steamship Pompey, Galvez, and the National Coal Company, to

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pay Ohta Development damages suffered by the latter by reason of the

destruction of its pier and the loss of its merchandise then stored on said pier. ISSUES/HELD

WON respondents are liable. YES. RATIONALE

There was a strong undercurrent in the direction from west to east; Current forced ship towards the pier which impact resulted in its sinking. This is due to the fact that the ship was not fastened with a rope to a tree on shore and that the bow anchors had not been dropped.

Appellants urge that, according to the bills of lading of the lost merchandise, the defendant National Coal Company's liability ceased when the said merchandise was unloaded and placed on the dock. This contention is without merit. There is nothing in the bills of lading to uphold it. o Article 619 of the Code of Commerce provides that the captain shall be

answerable for the cargo from the moment that it is delivered to him at the wharf or alongside the ship in the harbor of embarkation until delivered on the shore or wharf of the port of discharge. Under this provision of the law it is the delivery of the cargo at the port of discharge that terminates the captain’s responsibility as to the cargo.

When the merchandise was lost on account of the sinking of the dock, it had not yet been delivered and consequently it was under the responsibility of the captain. The National Coal Company, as the operator, is responsible for the indemnities arising from the lack of skill or negligence of the captain. (Articles 587 and 618 of the Code of Commerce.)

It cannot be said the liability of the other defendants is subsidiary and limited to what the steamship Pompey may answer for. Such argument, seemingly based upon article 587 of the Code of Commerce which authorizes the shipowner to abandon the ship in order to answer for his liability to third persons, is inapplicable, for the reason that there was no abandonment of the ship. The Court does not believe that Steamship Pompey, et.al. based their contention upon article 837 which refers to collisions, because that is not the case here.

Guzman vs. William X | Torres (1907) FACTS

Guzman’s agent contracted with Behn, Meyer & Co., agents of steamer Kudat, in the sum of P150, for the towing of the lorcha Nevada, owned by Guzman, to the port of Iloilo. During the voyage, the port tow line broke, and the captain of the Kudat ordered the crew of the Nevada to come on board the Kudat and to abandon the lorcha; that as the master (arraez) protested several times against such order, the captain insisted and threatened to cut the other tow line. The crew then abandoned the lorcha and boarded the steamer and the captain then ordered the abandonment of the lorcha and cast her adrift by having the tow line cut, and the steamer then proceeded on her voyage to Iloilo.

The master or pilot of the lorcha went to the collector of customs and entered a

protest, in which he stated that the weather was fair, the sea calm, that the

moon was bright. The captain of the Kudat did not enter any protest in order to justify the abandonment of the lorcha nor the circumstances connected therewith.

Guzman filed a complaint with the CFI of Manila against the captain and owners of the steamer Kudat, demanding for indemnity for damages suffered for the abandonment of the lorcha Nevada, in the sum of P49,000.

Judgment was rendered sentencing the defendants, Behn, Meyer & Co., to pay the plaintiff herein the sum of P9,000.

ISSUES/HELD

WON the captain of Kudat is liable? – YES.

RATIONALE

The captain who commanded the steamer Kudat failed to comply with the contract for towage and acted for contravention of what had been stipulated therein between the owner of the lorcha in tow and the agents who represented the owners of the steamer, and when abandoning the lorcha in mid-ocean with the full knowledge that it would disappear and become a loss, he acted with marked negligence and a perfect knowledge of the loss and damage he was about to cause the owner. Therefore, pursuant to 1101 and 1601 of the CC, the owner of the lorcha must be indemnified, the contract of towage involving the obligation to use due diligence the omission of which would imply fault or negligence on the part of the obligee, because the lorcha Nevada was abandoned with the intent of casting her adrift to become a total loss.

Article 624 of the Code of Commerce imposes on a captain, in case he has been wrecked or the cargo of his vessel damaged, the duty of making the corresponding protest before the proper authority at the first port where the vessel touches, within the twenty four-hours following his arrival.

The captain of the Kudat did not make any protest before any officer or competent authority at Iloilo stating the reasons which compelled him to abandon the lorcha. On the other hand, the master or patron of the lost lorcha complied with this duty imposed by law and appeared before the collector of customs of Iloilo and set forth his protest.

Based on Articles 586 and 567 of the Code of Commerce, therefore, the aforesaid firm is the only party bound to indemnify the owner of the Nevada in the amount of the damages sustained by him through the loss of the lorcha.