Macam vs. Court of Appeals

The extraordinary responsibility of the common carrier over goods lasts until they are delivered to the consignee or to the person who has a right to receive them. The Court held that delivery of perishable goods to the buyer/importer without presentation of the bill of lading does not render the carrier liable where the shipper requested such release and the buyer, as the real party entitled to the goods, received them.

Petitioner Benito Macam, doing business as Ben-Mac Enterprises, shipped 3,500 boxes of watermelons and 1,611 boxes of fresh mangoes aboard respondent China Ocean Shipping Co.'s vessel, with respondent Wallem Philippines Shipping, Inc. as local agent. The shipment, bound for Hong Kong, was covered by two bills of lading naming the National Bank of Pakistan (PAKISTAN BANK) as consignee and Great Prospect Company (GPC) as the notify party. The bills of lading required that one original be surrendered in exchange for the goods. Petitioner's depository bank, Consolidated Banking Corporation (SOLIDBANK), pre-paid petitioner the total value of the shipment. Upon arrival in Hong Kong, respondents delivered the shipment directly to GPC without requiring the surrender of the bills of lading or a bank guarantee. GPC subsequently failed to pay PAKISTAN BANK, which in turn refused to pay SOLIDBANK. Petitioner allegedly reimbursed SOLIDBANK and demanded payment from respondents.

• Nature: Collection suit for the value of shipped goods delivered without the surrender of the bill of lading or bank guarantee.
• The Shipment and Delivery: On 4 April 1989, petitioner shipped perishable goods to Hong Kong via respondents' vessel. The bills of lading named PAKISTAN BANK as consignee and GPC as notify party. SOLIDBANK pre-paid petitioner the full value of the shipment on 6 April 1989. Respondents released the goods to GPC without requiring the original bills of lading or a bank guarantee.
• The Telex Instruction: Respondents predicated the delivery on a telex dated 5 April 1989, which instructed delivery of the shipments to the respective consignees without presentation of the original bill of lading and bank guarantee, per the shipper's request, since freight charges were fully paid. The telex named petitioner as shipper and GPC as consignee for the subject bills of lading.
• Petitioner's Practice: Petitioner denied issuing the 5 April 1989 telex but admitted during trial that it was his standard practice to request the immediate release of perishable goods via telephone calls without requiring the bill of lading or bank guarantee if the shipment was already fully paid. In his two to three years of business with GPC and respondents, there was no instance where the bill of lading was presented before the release of the cargoes.
• Non-Payment and Demand: GPC failed to pay PAKISTAN BANK, prompting PAKISTAN BANK to refuse payment to SOLIDBANK. SOLIDBANK demanded payment from respondents, but petitioner eventually took over the demand, claiming he had reimbursed SOLIDBANK.

• Petitioner argued that the delivery of the shipment to GPC instead of the consignee (PAKISTAN BANK) constituted misdelivery.
• Petitioner contended that, assuming the telex instruction existed, the delivery without the bill of lading or bank guarantee should have been made only to the designated consignee, PAKISTAN BANK, not to GPC.
• Petitioner disputed the authenticity of the 5 April 1989 telex, characterizing it as self-serving.

• Respondents countered that the shipment was delivered to GPC without the bill of lading and bank guarantee pursuant to petitioner's own request, as evidenced by the 5 April 1989 telex, due to the perishable nature of the goods.
• Respondents asserted that it is standard maritime practice to deliver perishable goods immediately upon the shipper's instruction without requiring the bill of lading, which usually takes time to arrive.
• Respondents argued that PAKISTAN BANK's refusal to pay the letters of credit was due to SOLIDBANK's failure to submit a Certificate of Quantity and Quality, not the delivery to GPC.

• Procedural Issues: N/A
• Substantive Issues:
  • Whether the delivery of the shipment to GPC (the notify party/buyer) instead of PAKISTAN BANK (the consignee) without the surrender of the bill of lading or bank guarantee constitutes misdelivery.
  • Whether respondents are liable for releasing the goods to GPC without the bill of lading or bank guarantee.

• Procedural: N/A
• Substantive:
  • The Court ruled that petitioner's argument regarding misdelivery was a deviation from his cause of action. The complaint and the prior demand letter clearly framed the issue as delivery without the bill of lading and bank guarantee, not misdelivery to the wrong party.
  • On the issue of delivery without the bill of lading, the Court found respondents not liable. Under Article 1736 of the Civil Code, the extraordinary responsibility of the common carrier lasts until delivery to the consignee or the person who has a right to receive them. GPC, as the buyer/importer named in the export invoices, was a person with a right to receive the goods.
  • Furthermore, petitioner's own testimony established his practice of requesting immediate release of perishable goods without the bill of lading or bank guarantee when the shipment was already fully paid. Because the goods were perishable and SOLIDBANK had pre-paid the full value, the Court found respondents' claim of a telex instruction credible.
  • Construing the telex instruction to deliver to "respective consignees," the Court agreed with the Court of Appeals that this referred to GPC, not PAKISTAN BANK. Requiring PAKISTAN BANK to provide a bank guarantee would be illogical since it already possessed the original bills of lading. Finally, petitioner failed to substantiate his claim that he reimbursed SOLIDBANK, suggesting he merely accommodated the bank to pursue the claim against respondents.

• Extraordinary Responsibility of Common Carriers — Under Article 1736 of the Civil Code, the extraordinary responsibility of the common carrier lasts from the time the goods are unconditionally placed in the possession of the carrier until the same are delivered, actually or constructively, to the consignee or to the person who has a right to receive them. The Court applied this doctrine to hold that delivery to the buyer/importer (GPC), rather than the named consignee (PAKISTAN BANK), was proper because the buyer was the person with the right to receive the goods.

• "The extraordinary responsibility of the common carriers lasts from the time the goods are unconditionally placed in the possession of, and received by the carrier for transportation until the same are delivered, actually or constructively, by the carrier to the consignee, or to the person who has a right to receive them, without prejudice to the provisions of article 1738." — This passage articulates the controlling statutory rule that extends the carrier's liability until delivery to the consignee or the person entitled to the goods, justifying the delivery to the buyer/importer in this case.

• Eastern Shipping Lines, Inc. v. Court of Appeals, G.R. No. 80936, 17 October 1990, 190 SCRA 512 — Cited as controlling precedent supporting the interpretation of Article 1736, specifically that delivery may be made to the person who has a right to receive the goods, not solely the named consignee.
• Samar Mining Company, Inc. v. Nordeutscher Lloyd, No. L-28673, 23 October 1984, 132 SCRA 529 — Followed alongside Eastern Shipping Lines for the same principle regarding the proper recipient of goods under Article 1736.

• Article 1736, Civil Code — Defines the duration of the extraordinary responsibility of common carriers from the time goods are received until they are delivered to the consignee or the person who has a right to receive them. The Court applied this provision to conclude that the delivery to the buyer/importer (GPC) was a valid discharge of the carrier's responsibility.

Mendoza, Quisumbing, and Buena, JJ.