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NEDLLOYD LIJNEN B.V. ROTTERDAM v. GLOW LAKS ENTERPRISES

FACTS:

The dispute in this case involves a foreign corporation, Nedlloyd Lijnen B.V. Rotterdam (Nedlloyd), and another foreign corporation, Glow Laks Enterprises, Ltd., organized under the laws of Hong Kong. Glow Laks loaded 343 cartoons of garments onto the vessel M/S Scandutch at the Port of Manila for carriage to the Port of Hong Kong. The goods were then transferred to another vessel, M/S Amethyst, for final carriage to Colon, Free Zone, Panama, both vessels being owned by Nedlloyd. Unauthorized persons forged the covering bills of lading and the goods were released based on the falsified documents. Glow Laks filed a claim with Nedlloyd for the recovery of the amount, but without success. As a result, Glow Laks initiated a civil case seeking the recovery of the amount. The Regional Trial Court (RTC) dismissed the complaint, ruling that the transfer of custody to the Port Authority in Panama absolved the common carrier from liability. On appeal, the Court of Appeals reversed the RTC's decision, stating that foreign laws were not proven and the common carriers' extraordinary responsibility remains until actual or constructive delivery of the cargoes. Nedlloyd then filed a petition for review on certiorari before the Supreme Court.

ISSUES:

  1. Whether the Panamanian laws were duly proven in accordance with the Rules of Evidence.

  2. Whether the deposition of Mr. Enrique Cajigas can be considered as proof of a foreign law.

  3. Whether or not the petitioners are liable for the misdelivery of goods under Philippine laws.

  4. Whether the common carriers' responsibility over the goods ceased upon delivery to the customs authorities.

  5. Whether surrender of the original bill of lading is a condition precedent for the common carrier to be discharged from its contractual obligation.

RULING:

  1. The Panamanian laws were not duly proven in accordance with the Rules of Evidence. The photocopy of the Gaceta Official of the Republica de Panama, which contains Law 42, was not accompanied by the required attestation and certification as mandated by Section 24, Rule 132 of the Revised Rules of Court. The deposition of Mr. Enrique Cajigas, a maritime law practitioner in Panama, cannot be recognized as proof of a foreign law, as he is not the custodian of the statute and therefore cannot guarantee its genuineness.

  2. The deposition of Mr. Enrique Cajigas cannot be considered as proof of a foreign law. It can be considered as an opinion of an expert witness, but it does not meet the requirements for proving a foreign law as specified in Section 24, Rule 132 of the Revised Rules of Court.

  3. The petitioners are liable for the misdelivery of goods. Under the New Civil Code, common carriers are bound to observe extraordinary diligence in the vigilance over goods. This standard of care is intended to protect shippers who are at the mercy of the common carrier once the goods are entrusted to them. The presumption is that the common carrier is at fault or negligent if the goods are lost or delivered to unauthorized persons. In this case, the goods were not delivered to the consignee as stated in the bill of lading and fell into the hands of unauthorized persons. The petitioners failed to prove that they exercised the required degree of diligence in preventing the unauthorized withdrawal of the shipments.

  4. The contract of carriage remains in full force and effect even after the delivery of the goods to the port authorities. The only delivery that releases the common carriers from their obligation to observe extraordinary care is the delivery to the consignee or his agents. The fact that the original bills of lading remain in the possession of the notify party or consignee is indicative of the continuing liability of the common carriers for the goods transported.

  5. Surrender of the original bill of lading is not a condition precedent for the common carrier to be discharged from its contractual obligation. However, there must be, at the very least, an acknowledgment of the delivery by signing the delivery receipt if surrender of the original bill of lading is not possible. In this case, there was neither surrender of the original copies of the bills of lading nor acknowledgment of the delivery. Thus, the contract of carriage still subsists and the common carriers could be held liable for the breach thereof.

PRINCIPLES:

  • Foreign laws do not prove themselves in Philippine jurisdiction and courts are not authorized to take judicial notice of them. They must be alleged and proved.

  • For a copy of a foreign public document to be admissible, it must be attested by the officer having legal custody of the records or by his deputy, and it must be accompanied by a certificate by a Philippine embassy or consular official stationed in the foreign country, authenticated by the seal of his office.

  • The deposition of an expert witness cannot be recognized as proof of a foreign law, as it does not meet the requirements of Section 24, Rule 132 of the Revised Rules of Court.

  • In certain cases, other competent evidence may be presented to prove the existence of foreign law, but this is an exception to the general rule.

  • Common carriers are bound to observe extraordinary diligence in the vigilance over goods.

  • Common carriers are responsible for the loss, destruction, or deterioration of goods, unless it is due to natural disasters or calamities.

  • Extraordinary diligence is the extreme care and caution used by persons of unusual prudence to secure or preserve their own property or rights.

  • The extraordinary responsibility of a common carrier begins from the time the goods are delivered to the carrier and continues until they are delivered to the consignee or the person entitled to receive them.

  • The common carrier may be relieved from responsibility for loss or damage to the goods upon delivery to the consignee or the person entitled to receive them.

  • The misdelivery of goods gives rise to a presumption of fault or negligence on the part of the common carrier.

  • To overcome the presumption of negligence, the common carrier must prove that it exercised extraordinary diligence over the goods.

  • The contract of carriage remains in full force and effect even after the delivery of the goods to the port authorities. The common carrier's responsibility over the goods continues until the delivery to the consignee. (Article 353 of the Code of Commerce)

  • Surrender of the original bill of lading is not a condition precedent for the common carrier to be discharged from its contractual obligation. However, there must be an acknowledgment of the delivery by signing the delivery receipt if surrender of the original bill of lading is not possible.