G.R. No. 28028, November 25, 1927
JUAN YSMAEL & CO., INC., plaintiff-appellee, vs. GABINO BARRETTO & CO., LTD., ET AL., defendants. ANDRES H. LIMGENGCO and VICENTE JAVIER, appellants.

DOCTRINE:
1. A common carrier cannot, by contract, exempt itself from liability for loss or damage to goods caused by its own negligence or that of its employees. Such stipulations are contrary to public policy.
2. Contractual stipulations limiting the time to file an action against a carrier must be reasonable. A 60-day period to file suit, especially when the carrier’s negligence is involved, is unreasonable and contrary to public policy.

FACTS

Juan Ysmael & Co., Inc. (plaintiff) delivered 164 cases of merchandise to the steamship *Andres*, represented by Gabino Barretto & Co., Ltd., for shipment from Manila to Surigao on October 25, 1922. Only 160 cases were delivered to the consignee, Salomon Sharuff. The plaintiff filed an action on April 17, 1923, to recover the value of the four undelivered cases amounting to P9,940.95.

The defendants (appellants Limgengco and Javier) raised the following defenses:
1. They did not receive the four missing cases.
2. The plaintiff’s action was barred for not being filed within the 60-day period stipulated in Clause 7 of the bill of lading.
3. Their liability should be limited to P300 per package under Clause 12 of the bill of lading, as the value of the silk was not declared.

The trial court found, based on the evidence (including the ship’s manifest, bills of lading, and testimony), that the defendants indeed received 164 cases and failed to deliver four. It ruled in favor of the plaintiff.

ISSUE

1. Was the trial court’s factual finding that the defendants received 164 cases but delivered only 160 supported by evidence?
2. Is the 60-day limitation period for filing suit under Clause 7 of the bill of lading valid and binding?
3. Is the liability limitation of P300 per package under Clause 12 of the bill of lading applicable?

RULING

1. YES, the factual finding is supported by a preponderance of evidence. The Supreme Court affirmed the trial court’s assessment of the evidence, which included the signed manifest, bills of lading, and the testimony of witnesses. The Court found the defendants’ evidence uncorroborated and insufficient to overturn the lower court’s findings.

2. NO, the 60-day limitation period is unreasonable and void as against public policy. While parties may contractually shorten the statutory period for filing suit, such a limitation must be reasonable. Citing American jurisprudence (Corpus Juris and Ruling Case Law), the Supreme Court held that a carrier cannot contractually exempt itself from liability for its own negligence. A 60-day period is too short and would effectively deprive shippers of a remedy, especially in cases involving the carrier’s negligence, as it subverts public policy. The plaintiff’s filing of the case within six months was timely.

3. NO, the liability limitation under Clause 12 is not applicable. The Court did not explicitly rule on this issue in the final summary, as the core ruling focused on the unenforceability of the time limitation due to the carrier’s negligence. However, the doctrine reiterated in the decision clearly states that a carrier cannot limit its liability for loss or damage caused by its own negligence. Since the loss was due to the carrier’s failure to deliver (a breach of its fundamental duty, presumed to involve negligence), the contractual limitation of liability would likewise be invalid as against public policy.

DISPOSITIVE PORTION:
The judgment of the lower court is AFFIRMED. The appellants are ordered to pay the plaintiff the sum of P9,940.95, with costs.