G.R. No. L-8746; October 30, 1914

FACTS:
The steamship “Islas Filipinas,” owned by Fernandez Hermanos, arrived at the port of Manila from Hongkong on or about April 15, 1912. Upon search by customs authorities, 918 tins of prepared opium, valued between P35,000 and P40,000, were discovered concealed in a water tank and under a table on the vessel. This opium was not included in the ship’s written or typewritten manifest, as required by law. The vessel’s master and another officer were criminally prosecuted, convicted, and punished for illegal importation. The owners, Fernandez Hermanos, had no knowledge of the smuggling, discharged the implicated crew members, and fully cooperated with the authorities. Nevertheless, the Insular Collector of Customs imposed a fine of P1,000 on the vessel under Section 77 of the Customs Administrative Act (Act No. 355). The Court of First Instance of Manila confirmed this decision, prompting the owners to appeal.

ISSUE:
Whether the owners of the steamship “Islas Filipinas” are liable for the administrative fine imposed on the vessel for failure to have a complete manifest of all cargo, despite their lack of knowledge or participation in the smuggling of the unmanifested opium.

RULING:
Yes. The Supreme Court affirmed the judgment of the lower court, holding the vessel and, consequently, its owners liable for the fine.

The Court ruled that the term “cargo” under the Customs Administrative Act includes all goods, wares, and merchandise aboard a vessel, excluding only the ship’s stores. The concealment of the opium did not remove it from the definition of cargo. The liability imposed by Section 77 of Act No. 355 is on the vessel itself (“every vessel”) for the failure to have a complete manifest, regardless of the owners’ knowledge or innocence. This strict liability is a legislative policy designed to protect public revenues and prevent fraud, making the vessel responsible for the unlawful acts of its master and crew. The Court emphasized that administrative fines under customs laws are distinct from criminal penalties and are necessary for the effective enforcement of revenue statutes. The owners’ lack of knowledge and good faith are immaterial to this administrative liability.