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ASIAN TERMINALS v. MALAYAN INSURANCE

FACTS:

On November 14, 1995, a shipment of 60,000 plastic bags of soda ash dense was shipped from China to Manila. The shipment was insured under Marine Risk Note No. RN-0001-21430 and covered by a Bill of Lading. Upon arrival in Manila, the bags were unloaded by the stevedores of petitioner Asian Terminals, Inc. for temporary storage. Upon completion of the unloading, 2,702 bags were found to be in bad order condition. The bags were then loaded onto trucks for transport and delivery but upon arrival at the consignee's warehouse, 2,881 bags were found to be in bad order condition due to spillage, caking, and hardening of the contents. The insurer, respondent Malayan Insurance Company, paid the value of the lost/damaged cargoes to the consignee. The insurer then filed a complaint for damages against petitioner, alleging that the damage/loss was caused by the negligence of petitioner's stevedores. The Regional Trial Court found petitioner liable and ordered it to pay the insurer. The Court of Appeals affirmed the ruling. Petitioner appealed, raising issues such as the non-presentation of the insurance contract, the finding that the damage/loss was caused by its stevedores, and the limitation of liability under a management contract for cargo handling services.

ISSUES:

  1. Is the non-presentation of the insurance contract or policy fatal to respondent's cause of action?

  2. Was the issue of non-presentation of the insurance contract or policy raised in the lower courts?

  3. Whether the respondent's right to subrogation was questioned by the petitioner.

  4. Whether the petitioner's attempt to absolve itself from liability must fail.

  5. Whether the factual findings of the CA affirming those of the RTC are conclusive and binding.

  6. Whether ATI satisfactorily rebutted the evidence of negligence on the part of its stevedores.

  7. Whether the finding of negligence on the part of ATI's stevedores is supported by both testimonial and documentary evidence.

  8. Whether the court can take judicial notice of the Management Contract entered into by petitioner and the PPA, which limits petitioner's liability to P5,000.00 per package.

RULING:

  1. Non-presentation of the insurance contract or policy is not necessarily fatal. The presentation of the insurance policy is not indispensable to establish the insurer's subrogatory right and the amount paid to settle the insurance claim. Exceptions to this general rule exist, such as when the cargo passed through several stages with different parties involved and it cannot be determined when the damage occurred. In this case, the loss of the cargo occurred while in the petitioner's custody, and there is no issue regarding the provisions of the insurance policy. The existence of the insurance contract was also admitted in open court. The presentation of the insurance contract or policy was not necessary.

  2. The issue of non-presentation of the insurance contract or policy was not raised before the trial court and was not included in the agreed upon issues during the pre-trial. Additionally, the issue was not raised on appeal. Issues or grounds not raised below cannot be resolved on review by the Supreme Court.

  3. The respondent's right to subrogation was not questioned by the petitioner.

  4. The petitioner's attempt to absolve itself from liability must fail.

  5. The factual findings of the CA affirming those of the RTC are conclusive and binding.

  6. No, ATI did not satisfactorily rebut the evidence of negligence on the part of its stevedores.

  7. Yes, the finding of negligence on the part of ATI's stevedores is supported by both testimonial and documentary evidence.

  8. No, the court cannot take judicial notice of the Management Contract entered into by petitioner and the PPA.

PRINCIPLES:

  • Non-presentation of the insurance contract or policy may not be fatal if the insurer's subrogatory right and the amount paid to settle the insurance claim are established through other evidence.

  • Exceptions exist to the general rule that the insurance contract must be presented in evidence. Exceptions include cases where the cargo passed through several stages with different parties involved and it cannot be determined when the damage occurred.

  • Factual findings of the CA affirming those of the RTC are conclusive and binding, except in certain specified cases.

  • The assessment of witnesses and their testimonies is a matter best undertaken by the trial court, and its findings on this point are accorded great respect and will not be reversed on appeal unless it overlooked substantial facts and circumstances that would materially affect the result of the case.

  • Negligence in handling cargo may give rise to liability under Articles 2180 and 2176 of the Civil Code.

  • Negligence can be proven through both testimonial and documentary evidence.

  • Judicial notice can only be taken of matters which are of public knowledge or capable of unquestionable demonstration or ought to be known to judges because of their judicial functions.