Yu Con vs.

Ipil | Araullo (1916)

FACTS
Respondent, Yu Con (Yu Con), chartered the banca Maria owned by petitioner
Narciso Lauron (Lauron) with Gilcerio Ipil (Ipil) as its master and Juto Solamo (Solamo)
as it supercargo to transport certain merchandise and money from the port of Cebu to
Catmon.
Yu Con loaded the merchandise and delivered the money, placed in a trunk, to
Ipil and Solamo.
Allegedly because there was no more room for Yu Cons trunk, Ipil and Solamo transferred
the money to their own trunk in the stateroom.
Before the ship could sail, the trunk and the money placed therein disappeared.

ISSUES/HELD
Are the petitioners liable for the loss? YES.

RATIONALE
It is therefore beyond all doubt that the loss of the money occurred through the
manifest fault and negligence of Ipil and Solamo.
o They failed to take the necessary precautions in order that the stateroom containing
the trunk in which they kept the money should be properly guarded by members of the
crew and they also did not expressly station some person inside the stateroom for the
guarding and safe-keeping of the trunk.
o All of these circumstances, together with that of its having been impossible to know
who took the trunk and the money, make the conduct of Ipil, Solamo, and the other
crew members eminently supicious and prevent our holding that the disappearance or
loss of the money was due to a fortuitous event, to force majeure.

Ipil and Solamo were depositaries of the sum in question and, having failed to exercise the
diligence required by the nature of the obligation of safe-keeping assumed by them and by
the circumstances of the time and the place, it is evident that they are liable for its loss or
misplacement and must restore it.

With respect to Lauron, he is also liable in accordance with the provisions of the Code
of Commerce in force because, as the proprietor and owner of the vessel who
executed a contract of carriage with Yu Con, there occurred the loss, theft, or robbery
of the P450 that belonged to Yu Con through the negligence of Ipil and Solamo and which
theft does not appear to have been committed by a person not belonging to the craft.
The old Code of Commerce absolved the shipowner from liability for the
negligence of the captain and its crew but, in the light of the principles of
modern law, this doctrine on the non-liability of the shipowner for the unlawful
acts, crimes or quasi crimes, committed by the captain and the crew can no
longer be maintained in its absolute and categorical terms.
o In maritime commerce, the shippers and passengers in making contracts with the
captain do so through the confidence they have in the shipowner who appointed him;
they presume that the owner made a most careful investigation before appointing him,
and, above all, they themselves are unable to make such an investigation, and even
though they should do so, they could not obtain complete security, inasmuch as the
shipowner can, whenever he sees fit, appoint another captain instead.
o Thus, it is only proper that the shipowner should be made liable.
Inter-Orient Maritime Enterprises, Inc. vs. NLRC | Feliciano (1994)

RATIO DECIDENDI
A ships captain must be accorded a reasonable measure of discretionary authority
to decide what the safety of the ship and of its crew and cargo specifically requires
on a stipulated ocean voyage.

FACTS
Captain Tayong was hired by Trenda World Shipping and Sea Horse Ship Management
through Inter-Orient Maritime Enterprises for a period of 1 year.
He took command of Inter-Orients vessel in Hong Kong.
o He was instructed to replenish bunker and diesel fuel, to sail forthwith to Richard Bay,
South Africa, and there to load 120, 000 metric tons of coal.
Since a storm would hit Hong Kong, precautionary measures were taken to secure the
vessels safety considering that the turbo-charger was leaking and the vessel was 14 years
old.
Captain Tayong followed-up the requisition by the former Captain for supplies of oxygen
and acetylene, necessary for the welding-repair of the turbo-charger and economizer.
The vessel sailed to Singapore.
o On the way to Singapore, the vessel stopped in the middle of the ocean for 6 hours and
45 minutes due to a leaking economizer.
o He was instructed to shut down the economizer and use the auxiliary boiler instead.
When the vessel arrived in Singapore, the Chief Engineer reminded Captain Tayong that
the oxygen and acetylene supplies had not been delivered.
o Upon inquiry, the Captain was informed that the supplies could only be delivered on
Aug. 1 as the stores had closed.
Captain Tayong called the shipowner, Seahorse Ship Management and informed them that
the departure of the vessel for South Africa may be affected because of the delay in the
delivery of the supplies.
o He was advised to contact Mr. Clark, the Technical Director.
o According to Mr. Clark, after being informed that the ship cannot travel without the
supplies, Captain Tayong agreed with him when he said by shutting off the water to the
turbo chargers and using the auxiliary boilers, there should be no further problem.
o According to Captain Tayong, he was informed by Sea Horse to wait for the supplies.
Captain Tayong immediately sailed for South Africa upon the delivery of the supplies.
Upon reaching South Africa, Captain Tayong was instructed to turn-over his post to the new
captain. He was thereafter repatriated to the Philippines.
o He was not informed of the charges against him.
He then instated a complaint for illegal dismissal.

ISSUES/HELD
WoN Captain Tayong was illegally dismissed? YES.

RATIONALE
Confidential and managerial employees cannot be arbitrarily dismissed at any time, and
without cause as reasonably established in an appropriate investigation.
o They are also entitled to security of tenure, fair standards of employment and the
protection of labor laws.
The captain of a vessel is a confidential and managerial employee.
A captain commonly performs 3 distinct roles: (1) he is a general agent of the shipowner;
(2) he is also commander and technical director of the vessel; and (3) he is a
representative of the country under whose flag he navigates.
 o The most important is the role performed by the captain as the commander of the
vessel. Such a role analogous to that of Chief Executive Officer of a present-day
corporate enterprise.
A ships captain must be accorded a reasonable measure of discretionary authority to
decide what the safety of the ship and of its crew and cargo specifically requires on a
stipulated ocean voyage.
o The captain is held responsible for such safety.
The captain has control of all departments of service in the vessel, and reasonable
discretion as to its navigation.
It is the right and duty of the captain, in the exercise of sound discretion and in good faith,
to do all things with respect to the vessel and its equipment and conduct of the voyage
which are reasonably necessary for the protection and preservation of the interests under
his charge.
o It is a basic principle of admiralty law that in navigating a merchantman, the master
must be left free to exercise his own best judgment.
o The requirements of safe navigation compel us to reject any suggestion that the
judgment and discretion of the captain of a vessel may be confined within a straight
jacket.
The master is entitled to delay for such a period as may be reasonable under the
circumstances.
Captain Tayong had reasonable grounds to believe that the safety of the vessel and crew
required him to wait for the delivery of the supplies needed.
o The vessel had stopped mid-ocean for 6 hours and 45 minutes on its way to Singapore
because of its leaking economizer.
o Captain Tayong did not maliciously and arbitrarily delay the voyage to South Africa.
The decision of Captain Tayong did not constitute a legal basis for his summary dismissal.