G.R. No. L-7675; March 25, 1913
G. URRUTIA & CO., plaintiff-appellee, vs. BACO RIVER PLANTATION CO., defendant-appellee. M. GARZA, intervener-appellant.

FACTS

A collision occurred between the steamship Nuestra Señora del Pilar (owned by plaintiff G. Urrutia & Co.) and the schooner Mangyan (owned by defendant Baco River Plantation Co.). The steamer sank, and the schooner was damaged. Plaintiff sued defendant for damages, alleging negligence by the schooner. Defendant counterclaimed, alleging gross negligence by the steamer. Intervener M. Garza, whose merchandise was lost on the steamer, intervened to recover its value. The trial court found the steamer grossly negligent and also found that the schooner, despite having the right of way, contributed to the collision by maintaining its course when it could have maneuvered to avoid it. The trial court thus held neither party could recover from the other and dismissed both the complaint and the counterclaim. Garza’s claim was also dismissed.

ISSUE

(1) Whether the schooner was negligent for keeping its course and speed under the rules governing collision avoidance. (2) Whether the defendant can recover on its counterclaim for damages to its schooner despite the total loss of the negligent steamer. (3) Whether the intervener can recover for his lost cargo.

RULING

(1) No. Under the International Rules for the Prevention of Collisions at Sea, the steamer (burdened vessel) had the duty to keep out of the way of the schooner (privileged vessel). The schooner had the correlative duty to keep its course and speed. The schooner complied with this rule during the period of risk of collision. Its last-minute maneuver was an action in extremis for which it is not liable. The presumption of fault against the steamer in a collision with a sail vessel stands. The trial court’s finding that the schooner contributed by not maneuvering earlier is erroneous under the applicable rules. The steamer’s gross negligence was the sole proximate cause of the collision. (2) Yes. The defendant is entitled to recover on its counterclaim. Although the negligent steamer was totally lost, it was insured, and the plaintiff collected the insurance. Under Article 1186 of the Civil Code, the right to the insurance proceeds is subrogated to the creditor (defendant) upon the extinction of the obligation by the loss of the thing. Therefore, the insurance money substitutes the lost vessel and is answerable for the damages caused by its negligence, up to the amount received. (3) No. The intervener cannot recover. His complaint alleged negligence by “one or the other” of the vessels without specifying which. The trial court correctly dismissed his complaint as he failed to prove a cause of action against either party specifically. The judgment against the plaintiff in favor of the defendant on the counterclaim is affirmed. The dismissal of the plaintiff’s complaint and the intervener’s complaint is also affirmed. The case is remanded for the entry of judgment in favor of the defendant for P4,010.99 against the plaintiff.