G.R. No. 19189 ; November 27, 1922
FROILAN LOPEZ, plaintiff-appellant, vs. SALVADOR V. DEL ROSARIO and BENITA QUIOGUE DE V. DEL ROSARIO, defendants-appellants.

FACTS

Benita Quiogue de V. del Rosario (Mrs. Del Rosario) owned and operated a bonded warehouse. Froilan Lopez held warehouse receipts for copra stored there. The receipts required payment for storage and insurance in advance. Lopez paid insurance premiums only until May 18, 1920. Mrs. Del Rosario secured fire insurance policies on the warehouse and its contents, including the copra, in her own name (except one policy in favor of Compañia Coprera de Tayabas). The warehouse and its contents were destroyed by fire on June 6, 1920. Mrs. Del Rosario, through arbitration, collected the insurance proceeds. She settled with all other depositors except Lopez. Lopez sued to recover the value of his copra from the insurance proceeds collected by Mrs. Del Rosario. The trial court awarded Lopez P88,495.21. Both parties appealed.

ISSUE

1. Whether Lopez is entitled to a share of the total insurance proceeds collected by Mrs. Del Rosario.
2. Whether Lopez must contribute to the expenses incurred by Mrs. Del Rosario in collecting the insurance proceeds.
3. The correct computation of the net amount due to Lopez.

RULING

1. Yes. The Supreme Court held that Mrs. Del Rosario, as bailee/warehouseman, acted as an agent for the depositors, including Lopez, in securing the insurance. Even if she did not act as an agent, the law provides that a policy taken by a bailee covering his own property and property held in trust inures proportionately to the benefit of all owners. Lopez is therefore entitled to his proportionate share of the insurance proceeds collected for the copra.
2. Yes. Although Lopez did not expressly authorize the arbitration agreement, he benefited from the amicable settlement. Therefore, he must bear his proportionate share of the expenses incurred in collecting the insurance proceeds.
3. The Supreme Court modified the trial court’s judgment. Lopez is entitled to P88,595.43 (his claimed share, including a portion of interest on salvaged copra). From this, the following deductions were made: (a) P7,185.88 as his proportionate share of collection expenses, and (b) P315.90 for unpaid storage and insurance premiums. The net award is P81,093.65, with legal interest at 6% per annum from May 13, 1921.