G.R. No. L-22576 October 31, 1967
ALPHA INSURANCE & SURETY CO., plaintiff-appellee, vs. MANILA PORT SERVICE and MANILA RAILROAD COMPANY, defendants-appellants.

FACTS

On May 28, 1961, defendants Manila Port Service and Manila Railroad Company received a shipment of 58 packages of “coal tar dyestuffs” from the S/S “Buenos Aires Maru,” consigned to General Textiles, Inc. in Manila. The consignee failed to receive one package. On June 5, 1961, the consignee filed a provisional claim with the defendants “for cargoes landed in bad order condition and short-landed” under paragraph 15 of the management contract. A formal claim stating the nature of the loss and its value of P600 was filed on March 22, 1962. The plaintiff, Alpha Insurance & Surety Co., Inc., as insurer subrogated to the rights of the consignee, was advised in writing by the defendants on June 27, 1962, that its claim had prescribed due to failure to bring suit within one year from the date of discharge of the goods. The plaintiff filed the present action in the municipal court of Manila on June 29, 1962. Both the municipal court and, on appeal, the Court of First Instance of Manila rendered judgment in favor of the plaintiff based on a written stipulation of facts. The defendants appealed.

ISSUE

The main issues are: (1) whether the provisional claim filed on June 5, 1961, substantially complied with paragraph 15 of the management contract; (2) whether the provisional claim was against the defendants; and (3) whether the action filed on June 29, 1962, was time-barred under the one-year prescriptive period provided in the management contract.

RULING

The Supreme Court affirmed the judgment of the lower court. First, the provisional claim, although not stating the value, contained a sufficient description of the importation to allow the defendants reasonable verification, constituting substantial compliance with paragraph 15 of the management contract. Any deficiency was supplied by the subsequent formal claim. Second, the stipulation of facts unequivocally stated that the defendants received the shipment and failed to deliver one package, refuting the contention that the claim was against the carrier. Third, the action was not time-barred. Paragraph 15 provides two alternative periods: one year from the date of discharge, or one year from the date the claim is rejected or denied, provided a provisional claim is filed within 15 days from discharge. Here, the defendants neither honored nor rejected the claim within one year from the date of last discharge (May 28, 1961). Therefore, the claim was deemed rejected on May 28, 1962. The action, filed on June 29, 1962, was within one year from that deemed rejection date and thus not prescribed.