G.R. No. 125524 . August 25, 1999.
BENITO MACAM doing business under the name and style BEN-MAC ENTERPRISES, petitioner, vs. COURT OF APPEALS, CHINA OCEAN SHIPPING CO., and/or WALLEM PHILIPPINES SHIPPING, INC., respondents.

FACTS

On April 4, 1989, petitioner Benito Macam shipped 3,500 boxes of watermelons and 1,611 boxes of fresh mangoes on board the vessel Nen Jiang, owned by respondent China Ocean Shipping Co. and operated through its local agent, respondent Wallem Philippines Shipping, Inc. (WALLEM). The shipments were covered by Bills of Lading designating the National Bank of Pakistan, Hongkong (PAKISTAN BANK) as consignee and Great Prospect Company of Kowloon, Hongkong (GPC) as the notify party. The Bills of Lading contained a provision requiring surrender of a duly endorsed bill for the release of the goods. Petitioner’s depository bank, Consolidated Banking Corporation (SOLIDBANK), paid him in advance the total value of the shipment (US$20,223.46) per letter of credit requirements. Upon arrival in Hongkong, respondent WALLEM delivered the shipment directly to GPC without requiring the surrender of the original bills of lading. Subsequently, GPC failed to pay PAKISTAN BANK, which then refused to pay SOLIDBANK. After SOLIDBANK demanded payment from WALLEM to no avail, petitioner allegedly reimbursed SOLIDBANK and then sued respondents for the value of the shipment, claiming they released the goods without the required bills of lading or a bank guarantee. Respondents defended their action by presenting a telex dated April 5, 1989, which they claimed was a request from the shipper (petitioner) to arrange delivery to the respective consignees without presentation of the original bills of lading, citing the perishable nature of the goods and standard maritime practice. They also argued that previous similar transactions between the parties involved deliveries without bills of lading. The Regional Trial Court ruled in favor of the petitioner, but the Court of Appeals reversed the decision and dismissed the complaint.

ISSUE

Whether respondents are liable to petitioner for releasing the goods to GPC without requiring the surrender of the original bills of lading or a bank guarantee.

RULING

The Supreme Court denied the petition and affirmed the decision of the Court of Appeals. The Court held that respondents were not liable. It found that the delivery to GPC, the buyer/importer named in the export invoices and referred to as such by petitioner in his demand letter and complaint, was proper under Article 1736 of the Civil Code, as GPC was a person who had a right to receive the goods. The Court emphasized that petitioner’s cause of action was not for misdelivery but specifically for delivery without the bills of lading or bank guarantee. The Court gave credence to the telex instruction presented by respondents, which authorized delivery without the original bills of lading. It noted petitioner’s failure to sufficiently refute the authenticity of this telex and his admission during cross-examination that he had made similar requests in the past. Furthermore, the Court found that petitioner failed to substantiate his claim of having reimbursed SOLIDBANK, and thus lacked a cause of action against respondents, as any right to collect payment pertained to SOLIDBANK, which had already pre-paid petitioner.