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CHOA TIEK SENG v. CA

FACTS:

On November 4, 1976, the petitioner imported lactose crystals from Holland. The goods were insured by the respondent insurance company for the sum of P98,882.35, against all risks under the terms of the insurance cargo policy. Upon arrival at the port of Manila, 403 out of the 600 bags were in bad order and suffered spillage and loss. The petitioner filed a claim for the loss, but the insurance company rejected the claim. Petitioner then filed a complaint against the insurance company seeking payment of damages. The trial court dismissed the complaint, counterclaim, and third-party complaint. The Court of Appeals affirmed the decision of the trial court. Petitioner filed a motion for reconsideration which was denied.

ISSUES:

  1. Whether the insurance company is liable for the damages sustained by the cargo.

  2. Whether the damage suffered by the cargo falls within the coverage of the "against all risk" policy.

RULING:

  1. The insurance company is liable for the damages sustained by the cargo. The damage suffered by the cargo falls within the coverage of the "against all risk" policy.

PRINCIPLES:

  • The report of a surveyor is binding on the party who caused the survey (respondent insurance company, in this case).

  • The party who admits the fact of damages is deemed to have sufficient proof of loss or damage.

  • "Perils of the sea" or "perils of navigation" render the insurer liable on account of the loss or damage brought about by marine casualties, such as shipwreck, foundering, stranding, and collision, among others.

  • Perils of the ship or perils that arise aboard the ship do not render the insurer liable for any loss or damage.

  • An "against all risk" marine policy covers all causes of conceivable loss or damage, except as otherwise excluded in the policy or due to fraud or intentional misconduct on the part of the insured.

  • The burden is on the insurance company to establish that the loss or damage falls within the exceptions provided for by law in an "against all risk" policy. Otherwise, the insurance company is liable for the loss or damage.

  • An "all risks" provision in a marine policy extends coverage to risks not usually contemplated and avoids burdening the insured with proving that the loss was due to a peril falling within the policy's coverage. The insurer can avoid coverage by demonstrating that a specific provision expressly excludes the loss from coverage.