GR L 46340; (April, 1983) (Digest)
G.R. No. L-46340 April 28, 1983
SWEET LINES, INC., petitioner, vs. THE HONORABLE COURT OF APPEALS, MICAELA B. QUINTOS, FR. JOSE BACATAN, S.J., MARCIANO CABRAS and ANDREA VELOSO, respondents.
FACTS
Private respondents purchased first-class tickets from petitioner Sweet Lines, Inc. for passage from Cebu to Catbalogan, Samar, aboard the M/V Sweet Grace. The vessel’s departure was delayed due to engine trouble, requiring it to return to Cebu for repairs. After repairs were completed, the vessel finally departed. However, instead of proceeding to its first scheduled port of call, Catbalogan, the vessel bypassed it and sailed directly to Tacloban. The passengers were forced to disembark in Tacloban and find their own means of transport to their intended destination. Consequently, the passengers filed a suit for damages against the shipping company for breach of contract of carriage. The trial court ruled in favor of the passengers, awarding moral and exemplary damages, which was affirmed by the Court of Appeals.
ISSUE
Whether petitioner Sweet Lines, Inc. is liable for damages for breaching its contract of carriage by bypassing the port of Catbalogan without justifiable cause and without prior notice to the passengers.
RULING
Yes, the petitioner is liable. The Court applied Articles 614 and 698 of the Code of Commerce, which govern a carrier’s liability for failing to fulfill its voyage undertaking. The right to indemnity arises if the failure or interruption of the voyage is not due to a fortuitous event or force majeure and is caused by the captain. The Court found no fortuitous event justifying the bypass. The initial engine trouble, which was not considered a fortuitous event, only caused the delay. By the time the vessel sailed, it was fully repaired. The admitted reason for bypassing Catbalogan was to catch up with the schedule and because there were fewer passengers bound for that port. This constituted an interruption of the voyage caused by the captain upon management’s instruction, not by force majeure.
The Court rejected the petitioner’s defense based on the conditions printed on the ticket, which reserved the right to change schedules without notice. These conditions were not complied with, as the carrier neither refunded the tickets nor provided alternative transportation to Catbalogan. More importantly, such stipulations cannot override the mandatory provisions of the Code of Commerce. The Court sustained the finding of bad faith by the lower courts, as the carrier knowingly failed to notify the passengers, made false assurances about departure, and did not offer refunds or assistance. However, the Supreme Court modified the damages awarded, reducing the moral damages to P3,000.00 for each passenger and deleting the exemplary damages, while affirming the award for attorney’s fees. The carrier’s civil liability is clear under Article 586 of the Code of Commerce, which holds the ship agent liable for the acts of the captain.