GR 154305; (December, 2004) (Digest)
G.R. No. 154305 December 9, 2004
MACONDRAY & CO., INC., petitioner, vs. PROVIDENT INSURANCE CORPORATION, respondent.
FACTS
Provident Insurance Corporation, as insurer, paid Atlas Fertilizer Corporation for a shortage in a shipment of potash transported by the vessel M/V ‘Trade Carrier’. Provident, being subrogated to the consignee’s rights, filed a complaint for damages against Trade and Transport and Macondray & Co., Inc. The case against Trade and Transport was dismissed due to failure to serve summons. Macondray denied liability, asserting it was merely the local representative of the shipper, Canpotex, and not an agent of the vessel owner. The trial court dismissed the complaint, finding Macondray was not an agent of Trade and Transport.
ISSUE
Whether Macondray & Co., Inc. can be held liable for the cargo shortage despite not being the agent of the vessel owner.
RULING
Yes. The Supreme Court affirmed the Court of Appeals’ decision holding Macondray liable. The legal logic proceeds from the specific provisions of the Code of Commerce governing ship agents, distinct from the Civil Code’s general rules on agency. The trial court’s finding that Macondray was not an agent of Trade and Transport (the alleged owner) is not dispositive. The Court of Appeals correctly found, based on the evidence, that Macondray acted as the ship agent for the vessel M/V Trade Carrier itself. As the ship agent entrusted with provisioning or representing the vessel in the port, Macondray is civilly liable for the indemnities in favor of third persons arising from the conduct of the captain in the care of goods under Article 586 of the Code of Commerce. This liability attaches irrespective of the vessel’s ownership. Since the cargo shortage occurred under the captain’s care, Macondray, as the ship agent, is directly liable to the insurer, Provident, which was properly subrogated to the consignee’s rights. The Court also rejected Macondray’s procedural arguments, noting that the negligence of its former counsel in failing to timely appeal the CA decision bound the client, as clients are expected to monitor the progress of their cases.