GR 1616; (April, 1904) (Digest)
G.R. No. 1616 : April 22, 1904
JUAN CAÑIZARES HIVA, plaintiff-appellant, vs. THE PHILIPPINE TRADING COMPANY, defendant-appellee.
FACTS:
On October 29, 1900, Juan Cañizares Hiva and the Philippine Trading Company entered into a contract of affreightment. The key stipulations were: (1) the Company’s steamer Pax would touch at the port of Amoy to receive cargo and passengers; (2) Cañizares guaranteed a minimum of 600 Chinese emigrant passengers for the round trip from Manila to Amoy and back, at a rate of 9 pesos each, for a total of 5,400 pesos, payable whether or not the passengers embarked; (3) Cañizares paid an advance of 2,000 pesos upon signing. On November 3, 1900, the Pax departed Manila for Hong Kong. On November 5, the Company learned that the embarkation of Chinese emigrants in Amoy was prohibited. After confirming this, Cañizares ordered the suspension of the voyage to Amoy, and the vessel returned directly to Manila from Hong Kong. Cañizares filed suit to recover his 2,000-peso advance, arguing the contract was not executed due to an unforeseen cause not attributable to him and that there was a mutual withdrawal. He contended the contract’s execution only commenced upon the vessel’s arrival in Amoy, which never occurred.
ISSUE:
Whether Juan Cañizares Hiva is entitled to a refund of the 2,000-peso advance paid under the contract of affreightment.
RULING:
No. The Supreme Court denied the refund and dismissed the complaint. The Court held that the contract was a partial affreightment, not a charter of the entire vessel. The obligation of the Philippine Trading Company commenced upon the vessel’s departure from Manila, not merely upon its arrival in Amoy. The contract expressly covered the voyage “from Manila to Amoy and return,” and Cañizares had the right to embark his guaranteed passengers either in Manila or Amoy. The defendant had therefore begun the execution of the contract. The fact that the vessel carried other cargo to Hong Kong was permissible, as Cañizares only hired space on the decks. The prohibition on embarkation in Amoy, which led Cañizares to suspend the voyage, was for his own convenience. Consequently, he was liable to indemnify the Company for expenses incurred in the partial execution of the contract. The uncontroverted expense account showed the 2,000 pesos was a reasonable indemnity, precluding its recovery. The appealed judgment was reversed.