Commercial Law,  Legally Yours

Sealoader Shipping v. Grand Cement

Commercial Law. Transportation. Presumption of Negligence. Contributory Negligence.
Sealoader Shipping Corporation v. Grand Cement Manufacturing Corporation
G.R. No. 167363 & G.R. No. 177466, December 15, 2010
Leonardo-De Castro, J.

Sealoader executed a Time Charter Party Agreement with Joyce Launch for the chartering of MT Viper in order to tow its unpropelled barges for a minimum of 15 days. Sealoder also entered into a contract with Grand Cement for the loading of cement clinkers and the delivery thereof to Manila.

Eventually, Sealoder’s barge arrived at the wharf of Grand Cement tugged by MT Viper. It was not immediately loaded as the employees of Grand Cement were loading another vessel.

The barge was still docked at the wharf of Grand Cement when typhoon Bising struck in the area of Cebu. As it became stronger, MT Viper tried to tow the barge away but it was unsuccessful. The towing line connecting the vessels snapped since the mooring lines were not cast off. As such, the barge rammed the wharf which caused significant damage.

Grand Cement filed a complaint for damages when Sealoader ignored its demands for compensation of the damage caused. They allege that Sealoader was negligent when it ignored its employee’s advice to move the vessels after it had received weather updates. Sealoader filed a motion to dismiss on the ground that Joyce Launch is the one liable since it was the owner of MT Viper, and whose employees were manning the vessel. Sealoader filed a cross-claim against Joyce Launch. Joyce maintains that the damages were due to force majeure and faulted Grand Cement’s employees for abandoning the wharf leaving them helpless and for not warning them early on.

The RTC rendered judgment in favor of Grand Cement holding the two companies liable since there was a complete disregard of the storm signal, the captain of the vessel was not present and the vessel was not equipped with a radio or any navigational facility, which is mandatory. Joyce launch did not appeal. On appeal, the CA affirmed the decision but on MR, it partly reversed its decision finding Grand Cement to be guilty of contributory negligence since it was found that it was still loading the other vessel at the last minute just before the storm hit, which was the reason why Sealoder’s vessel did not move. The damages were reduced to 50%.

Who should be liable for damage sustained by the wharf of Grand Cement?

Sealoader was guilty of negligence, hence it is liable. First, because it was not equipped with a radio or a navigational facility and it failed to monitor the prevailing weather conditions. Second, it cannot pass the responsibility of casting off the mooring lines because the people at the wharf could not just cast off the mooring lines without any instructions from the crew of the vessel. It should have taken the initiative to cast off the mooring lines early on.

Moreover, there was no contributory negligence on the part of Grand Cement Manufacturing Corporation. It had timely informed the barge of the impending typhoon and directed the vessels to move to a safer place. Sealoader had the responsibility to inform itself of the prevailing weather conditions in the areas where its vessel was to sail. It cannot merely rely on other vessels for weather updates and warnings on approaching storms. To do so would be to gamble with the safety of its own vessel, putting the lives of its crew under the mercy of the sea, as well as running the risk of causing damage to property of third parties for which it would necessarily be liable. The evidence proffered by Sealoader to prove the negligence of Grand Cement was marred by contradictions and are, thus, weak at best. Thus, the contributory negligence of Grand Cement was not established in this case.

Hence, the award of damages in favor of the petitioner by the lower courts is reversed.

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