G.R. No. 184215 ; February 9, 2011
OCEANEERING CONTRACTORS (PHILS), INC., Petitioner, vs. NESTOR N. BARRETTO, doing business as N.N.B. LIGHTERAGE, Respondent.

FACTS

Respondent Nestor N. Barretto, owner of Barge “Antonieta,” entered into a Time Charter Agreement with petitioner Oceaneering Contractors (Phils.), Inc. on November 27, 1997. Oceaneering hired the barge to transport construction materials from Manila to Ayungon, Negros Oriental for a contract price of ₱306,000.00. The agreement included Oceaneering’s acknowledgment of the barge’s seaworthiness and stipulated that Oceaneering would be responsible for stevedoring during loading/unloading and for damages to the barge caused by the negligence of its hired stevedores. Oceaneering’s stevedores loaded the barge under the supervision of the broker and Barretto’s bargemen. The cargo was secured with ropes and steel stanchions welded onto the barge by Oceaneering. On December 3, 1997, the barge, towed by a chartered tugboat, left Manila. On December 5, 1997, Barretto’s bargeman executed a Marine Protest, reporting that the barge encountered rough seas near Cape Santiago, Batangas, causing the cargo to shift, breaking the steel stanchions and leaving holes in the deck, which allowed water to enter and ultimately caused the barge to capsize. Barretto claimed the mishap was due to Oceaneering’s negligence in loading and sought reimbursement for salvage, refloating, and repair expenses. Oceaneering countered that the barge tilted due to a hole in its hull, demanded the return of the unused charter payment, and sought reimbursement for its own salvaging expenses. Barretto filed a complaint for damages. The Regional Trial Court (RTC) dismissed both Barretto’s complaint and Oceaneering’s counterclaims. The Court of Appeals (CA) partially granted Barretto’s appeal, ordering Oceaneering to pay him ₱306,000.00 as actual damages and ₱30,000.00 as attorney’s fees. Oceaneering elevated the case to the Supreme Court.

ISSUE

Whether the Court of Appeals erred in awarding actual damages to respondent Barretto.

RULING

The Supreme Court GRANTED the petition, REVERSED and SET ASIDE the Decision of the Court of Appeals, and REINSTATED the Decision of the Regional Trial Court dismissing respondent Barretto’s complaint. The Court held that actual or compensatory damages cannot be presumed and must be duly proved with a reasonable degree of certainty. The award of actual damages must be based on competent proof and the best evidence obtainable to substantiate the claim. In this case, Barretto failed to present sufficient evidence to prove the actual expenses he allegedly incurred for the salvage, refloating, and repair of the barge. The receipts he presented were either insufficiently identified, not properly accounted for, or pertained to expenses incurred after the filing of the complaint, which is not allowed. Furthermore, the Court found that Barretto failed to establish that the loss of the barge was due to the fault or negligence of Oceaneering. The Time Charter Agreement contained Oceaneering’s acknowledgment of the barge’s seaworthiness, and Barretto did not successfully rebut the presumption that the barge was seaworthy at the time of the charter. The evidence did not conclusively prove that the negligence of Oceaneering’s stevedores caused the incident. Consequently, Barretto was not entitled to an award of actual damages. The award of attorney’s fees was also deleted due to the absence of a factual and legal basis.