G.R. No. L-30805 December 26, 1984
Domingo Ang, plaintiff-appellant, vs. Compania Maritima, Maritime Company of the Philippines and C.L. Diokno, defendants-appellees.

FACTS

Plaintiff-appellant Domingo Ang, as assignee of a bill of lading originally held by Yau Yue Commercial Bank, Ltd., filed a complaint for damages against the carrier defendants. The suit arose from the alleged misdelivery of a shipment of galvanized steel sheets. The cargo, consigned “to order,” was shipped from Japan to Manila aboard the defendants’ vessel. The bill of lading, endorsed to the bank, required its surrender for the release of the goods. Ang alleged that the defendants authorized delivery of the cargo to the consignee, Herminio G. Teves, through a customs permit without the surrender of the original bill of lading, after which Teves dishonored his draft. The bank endorsed the bill to Ang, who then sued.
The trial court dismissed the complaint on grounds of lack of cause of action and prescription. It ruled the action was filed beyond the one-year prescriptive period under the Carriage of Goods by Sea Act (COGSA). Ang appealed, contending the legal issues were already settled in his favor in prior analogous cases against another carrier.

ISSUE

Whether the trial court correctly dismissed the complaint on the grounds of lack of cause of action and prescription.

RULING

The Supreme Court reversed the trial court’s order of dismissal. On the issue of prescription, the Court held the one-year period under Section 3(6) of COGSA applies specifically to claims for “loss or damage” to the cargo, which has been judicially construed to refer to physical loss or damage during transit. The claim in this case is for misdelivery—the delivery of goods to the wrong party without surrender of the bill of lading—which constitutes a distinct legal wrong. For such a claim, the applicable prescriptive periods are those under the Civil Code: either four years for quasi-delicts (Article 1146) or ten years for breach of a written contract (Article 1144). Since Ang filed the action less than three years from the date of misdelivery, his action had not prescribed.
On the cause of action, the Court, following its precedent in Ang vs. American Steamship Agencies, Inc., ruled that Ang, as the endorse of the bill of lading, is the real party in interest entitled to sue for damages arising from the carrier’s breach of its contractual obligation to deliver the goods only upon presentation of the original bill. The alleged unauthorized delivery constitutes a valid cause of action. The case was remanded to the trial court for further proceedings.