G.R. No. L-6393; January 31, 1955
A. MAGSAYSAY INC., plaintiff-appellee, vs. ANASTACIO AGAN, defendant-appellant.

FACTS

The plaintiff, A. Magsaysay Inc., owned and operated the vessel S S “San Antonio.” On October 6, 1949, the vessel left Manila for Basco, Batanes, via Aparri, Cagayan, carrying general cargo from various shippers, including the defendant, Anastacio Agan. The vessel reached Aparri on October 10, 1949. After a day’s stopover, while still at the mouth of the Cagayan river within the port and attempting to proceed to Basco, the vessel ran aground. Attempts to refloat it under its own power failed. The plaintiff then engaged the Luzon Stevedoring Co. to refloat the vessel for an agreed compensation. Once refloated, the vessel returned to Manila to refuel and then proceeded to its destination, Basco, where the cargoes were delivered to their respective owners or consignees. All consignees except the defendant made a deposit or signed a bond to cover their contribution to the average. The plaintiff filed an action in the Court of First Instance of Manila to compel the defendant to pay his contribution of P841.40, as determined by the average adjuster, arguing that the refloating expenses constituted a general average to be shared by the ship and cargo. The defendant denied liability, contending that the stranding was due to the master’s fault, negligence, and lack of skill; that the expenses did not constitute general average; and that the liquidation of the average was not lawful. The trial court ruled in favor of the plaintiff. The defendant appealed directly to the Supreme Court.

ISSUE

Whether the expenses incurred in refloating a vessel that was unintentionally stranded inside a port at the mouth of a river during fine weather constitute a general average, thereby obliging the cargo owner to contribute.

RULING

No. The Supreme Court reversed the trial court’s decision and dismissed the plaintiff’s complaint. The Court held that the expenses did not constitute a general average. Applying the Code of Commerce and the requisites for general average as outlined by commentator Tolentino, the Court found: First, there was no common, imminent danger to both the vessel and the cargo. The stranding occurred in fine weather inside a port at a very shallow location, indicating no immediate, impending peril, only a potential distant peril. General average requires deliverance from an immediate peril, not the preservation of the voyage. Second, the sacrifice (expense) was not deliberately made for the common safety of both vessel and cargo, as the cargo was not in imminent danger and could have been unloaded without a salvage operation. Third, while the salvage was successful, the benefit was primarily for the vessel to continue its voyage, not to save the cargo from peril. Fourth, the plaintiff failed to prove that the expenses were incurred following the proper legal procedure outlined in the Code of Commerce. Consequently, the expenses were classified as a particular average (under Article 809 of the Code of Commerce), to be borne solely by the shipowner, and the cargo owner was not liable to contribute.