Wildvalley Shipping Co., Ltd. vs. Court of Appeals

Where foreign law is neither pleaded nor proved in accordance with the Rules of Court, Philippine courts will apply processual presumption and presume the foreign law to be the same as domestic law. Accordingly, under Philippine law, neither the master nor the owner of a vessel is liable for injuries occasioned by the negligence of a compulsory pilot, because the pilot is forced upon them by law and cannot be deemed their servant, thereby precluding the application of qui facit per alium facit per se and res ipsa loquitur.

The vessel Philippine Roxas, owned by respondent Philippine President Lines, Inc. (PPL), arrived in Puerto Ordaz, Venezuela, to load iron ore. Upon departure, the vessel navigated the Orinoco River—a compulsory pilotage channel—under the direction of Ezzar del Valle Solarzano Vasquez, an official pilot designated by Venezuelan harbor authorities. The vessel experienced vibrations at two points along the river; the pilot assured the watch officer that the vibrations were due to the shallowness of the channel. The vessel subsequently ran aground, obstructing the river's ingress and egress. Petitioner Wildvalley Shipping Co., Ltd., owner of the vessel Malandrinon, was unable to sail out of Puerto Ordaz due to the blockage.

• The Grounding: On February 12, 1988, the Philippine Roxas departed Puerto Ordaz, Venezuela, navigating the Orinoco River under the conduct of compulsory pilot Ezzar del Valle Solarzano Vasquez. The master, Captain Nicandro Colon, left the bridge while the vessel was under way, leaving the pilot, the officer on watch, and a helmsman on the bridge.
• The Vibrations: Upon entering the San Roque Channel, the vessel experienced vibrations. The pilot assured the watch officer that this was due to the shallowness of the channel. Between mile 158 and 157, vibrations recurred; the watch officer called the master, who verified the vessel was in the center of the channel and ordered the double bottom tanks checked. At 4:35 a.m., the vessel ran aground.
• The Obstruction and Damages: The grounded Philippine Roxas obstructed the channel, preventing the Malandrinon, owned by petitioner Wildvalley, from sailing out. Wildvalley filed suit against PPL for unearned profits and damages.
• Pre-Trial Stipulations: The parties stipulated that PPL owned the Philippine Roxas; the Orinoco River is a compulsory pilotage channel; the vessel grounded and obstructed navigation; and at the time of the incident, the vessel was under the command of a pilot assigned by the government, though petitioner maintained the vessel remained under the command of the master.
• Proof of Foreign Law: Petitioner presented photocopies of the Gaceta Oficial of Venezuela and a book issued by the Ministerio de Comunicaciones containing the applicable pilotage rules, along with the testimony of Captain Oscar Leon Monzon, the Assistant Harbor Master. However, these documents were not attested by the officer having legal custody, nor were they accompanied by the certificate of a Philippine diplomatic or consular officer stationed in Venezuela as required by the Rules of Court. Furthermore, Venezuelan law was never alleged or invoked in the complaint.

• Petitioner argued that the Court of Appeals erred in finding no negligence on the part of the master or owner of the Philippine Roxas.
• Petitioner contended that Venezuelan law should apply and that it was substantially proved at trial without objection from the respondent, rendering any objection on appeal belated.
• Petitioner maintained that the vessel was unseaworthy.
• Petitioner asserted that the doctrine of res ipsa loquitur should apply to the incident.
• Petitioner argued that the award of attorney's fees to the respondent was baseless and that petitioner should instead be entitled to attorney's fees, costs, and interest.

• Respondent countered that Venezuelan law was neither properly pleaded in the complaint nor proved in accordance with the Rules of Court, thus Philippine law should apply under the principle of processual presumption.
• Respondent argued that under Philippine law, the master exercised the diligence of a good father of a family and was not negligent in relying on the compulsory pilot's expertise.
• Respondent maintained that the vessel was seaworthy, as confirmed by Lloyd's Register of Shipping and the testimony of the vessel's engineers.
• Respondent contended that the grounding was solely attributable to the negligence of the compulsory pilot, for whom the owner should not be held liable.

• Procedural Issues: Whether the Court of Appeals erred in disregarding Venezuelan law despite its alleged substantial proof at trial and the belated objection by the respondent.
• Substantive Issues: Whether the owner and master of a vessel are liable for damages resulting from the negligence of a compulsory pilot; whether the Philippine Roxas was unseaworthy; whether the doctrine of res ipsa loquitur applies to the grounding of the vessel.

• Procedural: The Court ruled that the Court of Appeals did not err in disregarding Venezuelan law. Foreign laws do not prove themselves and are not subject to judicial notice; they must be both pleaded and proved. Petitioner failed to allege Venezuelan law in the complaint. Furthermore, the photocopies of the foreign statutes presented were not proved in the manner required by Section 24, Rule 132 of the Rules of Court, as they lacked the requisite attestation by the legal custodian and the authentication by a Philippine foreign service officer stationed in Venezuela. Accordingly, Philippine law applies via processual presumption.
• Substantive: The Court held that the owner and master are not liable for the negligence of the compulsory pilot. Under Philippine law, the master exercised the diligence of a good father of a family by relying on the pilot's specialized knowledge of the river. Because pilotage on the Orinoco River was compulsory, the pilot was forced upon the master; thus, the pilot cannot be deemed the servant of the master or owner, and the maxim qui facit per alium facit per se does not apply. The Court also found the vessel seaworthy based on the Confirmation of Class issued by Lloyd's Register of Shipping and the testimony that the main engines and auxiliaries were in good running condition. Finally, the Court held that res ipsa loquitur does not apply because the vessel was not under the exclusive management or control of the master or owner at the time of the incident, as there was a temporary shift of control to the compulsory pilot.

• Processual Presumption — Under private international law, if a foreign law is not properly pleaded and proved, the courts of the forum will presume that the foreign law is the same as the domestic or local law. The Court applied this doctrine because petitioner failed to allege Venezuelan law in the pleadings and failed to present duly authenticated copies of the foreign statutes, thereby necessitating the application of Philippine law to determine liability.
• Compulsory Pilotage Liability — When pilotage is compulsory, the pilot is forced upon the master and owner of the vessel. Consequently, the pilot cannot be considered the servant of the master or owner, and the principle of qui facit per alium facit per se does not apply. Neither the master nor the owner is liable for injuries occasioned by the negligence of a compulsory pilot. The Court applied this to absolve PPL from liability for the grounding caused by pilot Vasquez.
• Proof of Foreign Law — Foreign laws must be alleged and proved as facts. To prove a written foreign law or foreign public document, Section 24, Rule 132 of the Rules of Court requires: (1) an attestation by the officer having legal custody of the record or by their deputy; and (2) a certificate by a secretary of the embassy or legation, consul general, consul, vice consul, or consular agent or foreign service officer of the Philippines stationed in the foreign country, authenticated by the seal of their office. The Court found petitioner's evidence deficient because the photocopies of Venezuelan laws lacked these mandatory authentications.

• "if it is compulsive upon the master to take a pilot, and, a fortiori, if he is bound to do so under penalty, then, and in such case, neither he nor the owner will be liable for injuries occasioned by the negligence of the pilot; for in such a case the pilot cannot be deemed properly the servant of the master or the owner, but is forced upon them, and the maxim Qui facit per alium facit per se does not apply." (Quoting Homer Ramsdell Transportation Company vs. La Compagnie Generale Transatlantique)
• "Under the rules of private international law, a foreign law must be properly pleaded and proved as a fact. In the absence of pleading and proof, the laws of a foreign country, or state, will be presumed to be the same as our own local or domestic law and this is known as processual presumption."

• Homer Ramsdell Transportation Company vs. La Compagnie Generale Transatlantique, 182 U.S. 406 — Followed. The Court adopted the principle that in compulsory pilotage, the master and owner are not liable for the pilot's negligence because the pilot is forced upon them by law and is not their servant.
• Willamette Iron & Steel Works vs. Muzzal, 61 Phil. 471 — Followed. The Court cited this case to support the proposition that competent evidence, such as the testimony of a witness, may prove the existence of a written foreign law, although the formal requirements of the Rules of Court for public documents must still be satisfied.
• Yao Kee vs. Sy-Gonzales, 167 SCRA 736 — Followed. Cited for the doctrine that foreign laws must be properly pleaded and proved, and that in the absence of such proof, processual presumption applies.

• Section 24, Rule 132, Rules of Court — Prescribes the method for proving official records or public documents from foreign countries, requiring attestation by the legal custodian and a certificate from a Philippine diplomatic or consular officer authenticated by the seal of their office. The Court held that petitioner failed to comply with this provision, rendering the Venezuelan laws inadmissible as public documents.
• Article 1173, Civil Code — Defines fault or negligence as the omission of the diligence required by the nature of the obligation and the circumstances of the persons, time, and place. In the absence of stipulation, the diligence of a good father of a family is required. The Court applied this to find that the master exercised sufficient diligence by relying on the compulsory pilot's expertise.
• Section 11, PPA Administrative Order No. 03-85 — Provides that on compulsory pilotage grounds, the harbor pilot is responsible for damage due to negligence, while the master retains overall command and may countermand the pilot. The Court used this to illustrate the allocation of liability and control under Philippine law.
• Article 612, Code of Commerce — Enumerates the obligations of a captain, including taking command when entering and leaving ports, canals, roadsteads, and rivers, unless a pilot is on board discharging duties. The Court noted that while the master retains overall command, he is not required to be on the bridge while a pilot is navigating.
• Article 2208, Civil Code — Enumerates the exceptions when attorney's fees and expenses of litigation can be recovered, including when the court deems it just and equitable. The Court applied paragraph (11) of this article to uphold the award of attorney's fees to the respondent, who was forced to litigate due to the unfounded suit.

Bellosillo (Chairman), Mendoza, Quisumbing, and De Leon, Jr.