F.F. CRUZ & COMPANY, INC.

, Petitioner, - versus - PHILIPPINE IRON CONSTRUCTION

AND MARINE WORKS, INC., and/or ANCHOR METALS CORP., Respondents. x- - - - - - - - -
- - - - - - - - - - x PHILIPPINE IRON CONSTRUCTION AND MARINE WORKS, INC., and/or
ANCHOR METALS CORP., Petitioners, - versus - F.F. CRUZ &COMPANY INC.

Facts:

These are consolidated petitions for review on certiorari challenging the Decision1 dated
February 25, 2009 and Resolution2 dated June 8, 2009 of the Court of Appeals (CA) in CA-G.R.
CV No. 86460.

The CA held that Ancho~ Metals Corporation (AMC) is liable to pay F.F. Cruz and Company
(F.F. Cruz) for the damage caused by AMC's vessels to the barges owned by F.F. Cruz, but
mitigated the former's liability due to F.F. Cruz's contributory negligence. Both petitions
principally challenge the factual findings of the CA: in G.R. No. 188144, F.F. Cruz contests the
finding that it was guilty of contributory negligence; in G.R. No. 188301, AMC questions its
liability for actual damages.

On November 4, 1988, tugboat MIT "Jasaan" (Jasaan) docked at Brooke's Point for the purpose
of towing Barge "Florida" (Florida). AMC owned Florida and leased Jasaan from Philippine Iron
Construction & Marine Works, Inc. (PICMW) through a bareboat charter agreement.

In the evening of November 4, 1988, typhoon Welpring hit Brooke's Point. F.F. Cruz's Barge
609 and Pilipino sank, while Barge 1001 collided with the driven piles at the construction site.
That same evening, Jasaan towed Florida to a safer place because the latter's anchor line was
cut off. In the process, however, the rudder cable snapped and both Jasaan and Florida drifted
towards the seashore. The following day, the master of Imma, Antonio Bundal (Bundal), filed a
marine protest alleging that Jasaan and Florida were responsible for the damage to F.F. Cruz's
vessels and the driven piles. He alleged that there was an allision between Jasaan and Barge
1001, which caused the latter to hit the driven piles.

In tum, Florida bumped Barge 609 causing the latter to eventually sink. Pilipino likewise hit the
concrete piles as a result of the allision. The master of J asaan, Capt. Daniel Pino (Capt. Pino),
also filed a marine protest, reporting that both Jasaan and Florida were pushed ashore as a
result of the typhoon, causing damages to both vessels.

The Board of Marine Inquiry (BMI) absolved PICMW, AMC, Capt. Pino, and Florida's patron
Fausto dela Riarte of any administrative liability. It found that Jasaan and Florida maintained a
safe distance of 800 to 900 meters from F.F. Cruz's vessels. instead, the BMI recommended
that Bundal and the patrons of Barge 609, I 001, and Pilipino be faulted for their failure to
transfer their barges to a safe distance from the driven piles. The Philippine Coast Guard
affirmed the recommendations of the BMI.

F .F. Cruz filed a complaint for damages with the Regional Trial Court (RTC) of Quezon City
against both AMC and PICMW. The RTC found that there was "clear, positive and credible
evidence presented that [Jasaan] and [Florida] bumped and hit the vessels of [F.F. Cruz]." It
also held PICMW to be solidarily liable because Jasaan was not seaworthy due to the vessel's
lack of a functioning radio equipment and defective rudder. AMC and PICMW filed separate
notices of appeal. AMC insisted that the findings of the BMI should be controlling, i.e., that no
allision took place, and it should therefore be absolved of any civil liability. Meanwhile, PICMW
questioned the finding that Jasaan was not seaworthy.

F .F. Cruz and AMC filed their respective motions for reconsideration, which the CA denied. On
July 30, 2009, F.F. Cruz filed its petition for review,. AMC filed its own petition for review on
August 13, 11 On October 26, 2009, two petitions were consolidated.

Issue: Whether or not F .F. Cruz was guilty of contributory negligence.

Held:

Yes.

Simply put, the rule is that the BMI' s findings are binding and conclusive on the courts when it
is supported by substantial evidence. This is consistent with the elementary principle in
administrative law that findings of fact by administrative tribunals are conclusive when supported
by substantial evidence.

In finding that F .F. Cruz was guilty of contributory negligence, the CA relied on the factual
findings set forth in the BMI report. The pertinent portions of the report detailed how F .F. Cruz
failed to observe the proper standard of diligence in view of the imminent arrival of typhoon
Welpring: . Proper perusal of Exhibit "A-1" shows that only [Pilipino] was well secured with her
mooring lines and anchors immediately before the typhoon passed Brooke's Point, Palawan:
xxx .

From the above observations, it appears that Barge 609 and Barge 1001 were not individually
or separately well secured at the time the strong typhoon "W[e]lpring" was hitting the area of
Palawan particularly Brooke[']s Point. So that if the mooring lines at fore-ends of said vessels
which are numbered 2 and 3 respectively as shown in Exhibit A-1 snapped, as indeed it did, the
[Pilipino] would have been affected. Barge 609 and Barge 1001 starboard and port sides
respectively tied to the port side of [Pilipino] 's 5-ton anchors which are numbered 7 and 8. So if
the fore-ends mooring lines of Barge 609 and Barge 1001 parted away from Anchors Nos. 2
and 3, Anchors Nos. 7 and 8 of [Pilipino] would be overloaded and would have a tendency to
drag and its mooring lin.es subjected to undue tension stresses. The cutting off of the fore-end
mooring line of Barge 1001 had resulted to her sudden swinging towards the aft portion of
[Pilipino] resulting to the bumping/ramming against the latter. x x x 12.

The F.F. Cruz's vessels were located very near the driven piles of Brooke's Point Pier under
construction by F.F. Cruz & Co. In fact[,] before the typhoon "W[e]lpring" came on November 4,
1988, the vessels were still engaged in the actual driving of the posts/piles. The Barges did not
change their position except Barge 609 which was required by P.P.A. to vacate the causeway to
give way for MIT Jasaan and Barge Florida to dock; Barge 609 then proceeded to the
anchorage and dropped anchor at her position as indicated in Exhibit A-1; they only double their
preparation of the previous typhoon "Unsang." The crew did not move the [b]arges to keep
away from the driven concrete piles to avoid the unfinished pier from being hit by their vessels in
case the anchors dragged or the mooring lines are cut off at the height of the typhoon. So when
the fore-end mooring lines of the barges were cut off or dragged because of the strong winds
and big waves, the vessels bumped/rammed the driven piles of the unfinished pier thus
damaging their hulls resulting to the sinking of Barge 609 and [Pilipino]. Because of the
ramming/bumping/smashing by the F.F. Cruz's vessels, the driven piles that were hit were
destroyed and/or had fallen down mercilessly. xxx 14. x x x

[A]s admitted by no other than the Project Engineer of the ongoing project at Brooke's Point xx
x and the patrons of the F .F. Cruz's vessels, (M/T Imma, [Pilipino], [Barge] 609 and [Barge]
1001), they did riot anymore change the original positions of the vessels or move the vessels at
the anchorage, relying only upon their previous preparations when typhoon "Unsang" hit the
Philippines xx x. In finding that F.F. Cruz was negligent, the BMI clearly identified the evidentiary
basis in support of its conclusion. The CA cannot thus be faulted for relying on the BMI' s factual
findings to support its own conclusion that F .F. Cruz was guilty of contributory negligence
because such findings are supported by substantial evidence. With regard to the exoneration of
AMC, however, the CA correctly disregarded certain portions of the BMI report because they
were based entirely on conjecture instead of being grounded on substantial evidence. In
absolving AMC, the BMI merely stated that: The Board cannot believe the foregoing version of
F.F. Cruz & Co. because no master/captain with vast experience as mariner, like Captain Pino
of MIT Jasaan, would maneuver his vessel to go a longer travel with more resistance by the
forces of wind and waves, when in fact there is a shorter distance that his vessels could travel
with less effort and no possibility at all that they would hit another vessel in the process of
maneuvering towards the beach for safety. x x x 6

Such presumption is unwarranted given the consistent testimonies of F.F. Cruz's witnesses that
they saw Jasaan, with Florida in tow, heading towards the direction of their vessels at the height
of typhoon Welpring. In contrast, the CA's conclusion that AMC's vessels were responsible for
the allision were based on the positive testimonies of F.F. Cruz's witnesses and the admissions
of Jasaan's captain and Florida's patron that they indeed moved during the typhoon.

On this score, the findings of the CA are consistent with the trial court. In sum, we find no gross
or extraordinary misperception or manifest bias on the part of the CA when it found that AMC is
the immediate and proximate cause of the allision, but that F .F. Cruz is partly responsible for
the damage to Pilipino and the driven piles. We further restate one of the exceptions to the
general rule that the Court is not a trier of facts: when the findings are contrary to that of the trial
court as a result of its gross or extraordinary misperception of evidence or manifest bias.
ALLAN S. CU, vs. SMALL BUSINESS GUARANTEE AND FINANCE CORPORATION
THROUGH MR. HECTOR M. OLMEDILLO G.R. No. 211222

Facts:

SB Corp. is a government financial institution, mandated by law to provide easy access credit to qualified
micro, small and medium enterprises (MSMEs) through direct lending or through its conduit participating
financial institutions for re-lending. One of its clients was Golden 7 Bank, a banking corporation duly
organized and existing under Philippine laws.

An "Omnibus Credit Line Agreement" was executed, whereby G7 Bank was initially granted credit line
of Fifty Million Pesos by SB Corp. for re-lending to qualified MSMEs as sub-borrowers. Eventually, the
credit line was increased to Ninety Million Pesos, and in line with said increase, the Board of Directors of
G7 Bank authorized any two of its officers, namely Fidel L. Cu, Allan S. Cu [Cu], Lucia C. Pascual and
Norma B. Cueto, as signatories to loan documents, including postdated checks.

Subsequently, various drawdowns were made from the line and each drawdown was covered by a
promissory note, amortization schedule and postdated check.

Bangko Sentral ng Pilipinas (BSP) placed G7 Bank under receivership by the Philippine Deposit
Insurance Corporation (PDIC).

PDIC through its Deputy Receiver, took over the bank, its premises, assets and records. PDIC also closed
all of G7 Bank's deposit accounts with other banks.

Upon maturity of the subject postdated checks, SB Corp. deposited the same to its account with the LBP
Makati branch but all of them were dishonored for reason of "Account Closed". Subsequently, SB Corp.
sent demand letters to Cu and Pascual demanding payment of the amounts represented in the dishonored
checks. Despite receipt of the demand letters, Cu and Pascual failed to make good the dishonored checks,
prompting SB Corp. to file a Complaint-Affidavit for Violation of 22 B.P. 22 before the Office of the City
Prosecutor of Makati.

PDIC filed a Petition for Assistance in the Liquidation of G7 Bank with the RTC Branch 21 of Naga City.
SB Corp. then filed its Notice of Appearance with Notice of Claims with the liquidation court. The Me
TC issued an Order setting the arraignment of the accused Cu and Pascual.

Before the scheduled arraignment, however, Cu and Pascual filed an "Omnibus Motion (1. For the
Determination of Probable Cause 2. To Dismiss the Instant Cases on Jurisdictional Grounds 3. To Defer
the Arraignment and Further Proceedings on the Ground of Prejudicial Question 4. To Dismiss the
Case[s] for Lack of Probable Cause.

SB Corporation countered that the only issue being determined in a prosecution for BP 22 case is whether
or not the accused issued the worthless checks, the defense that they were precluded from fulfilling their
obligation by reason of the receivership is a mere afterthought and an evidentiary matter that can be
ventilated during trial.

The MeTC dismissed the B.P. 22 cases.

SB Corp. filed a Motion for Reconsideration from the Order of dismissal, but the same was denied by the
M[e]TC. It then appealed to the [Regional Trial Court, Branch 61, Makati City (RTC)] arguing that a
pending liquidation proceedings (sic) does not extinguish the criminal and civil liabilities of the
signatories to the dishonored corporate checks.

RTC rendered a Decision affirming the dismissal of the cases for Violation of B.P. 22.

SB Corp. filed a Motion for Reconsideration of the said Decision which was denied by the [RTC]. Hence
a petition for review was filed with the Court of Appeals.

In the decretal portion of its Decision, the CA: (1) granted the petition filed by SB Corp., (2) vacated and
set aside the May 2, 2011 Decision of the Regional Trial Court (RTC) of Makati City, Branch 61, and (3)
remanded the cases to the Me TC, Branch 65 of Makati City, for further proceedings.

Cu's motion for reconsideration was denied by the CA. Hence, this Petition for Review on Certiorari.

Issues:

1. Whether the CA erred in not dismissing the SB Corp.' s petition because an appeal from the dismissal
of a criminal case may be undertaken only by the State through the Solicitor General.

2. Whether the CA erred in reversing the May 2, 2011 Decision and September 5, 2011 Resolution of the
RTC.

Held:

1. Yes. SB Corp. lacked the authority to represent the State in the appeal of the criminal cases before the
CA as this authority is solely vested in the OSG. The OSG is the law office of the Government whose
specific powers and functions include that of representing the Republic and/or the People before any court
in any action which affects the welfare of the People as the ends of justice may require. Accordingly, if
there is a dismissal of a criminal case by the trial court, it is only the OSG that may bring an appeal of the
criminal aspect representing the People.

Clearly, SB Corp. did not file its petition for review with the CA merely to preserve its interest in the civil
aspect of the criminal cases but sought the reinstatement of the criminal prosecution of Cu for violation of
B.P. 22. Being an obvious attempt to participate in, or otherwise prosecute, the criminal aspect of the
cases without the conformity of the OSG, its recourse must fail.

This Court has, however, taken exceptions and given due course to several actions even when the
respective interests of the Government were not properly represented by the OSG, namely, when the
challenged order affected the interest of the State or the People, the case involved a novel issue, ·like the
nature and scope of jurisdiction of the Cooperative Development Authority, and the ends of justice would
be defeated if all those who came or were brought to court were not afforded a fair opportunity to present
their sides.

2. Yes. The Court finds that the MeTC and RTC acted correctly and did not gravely abuse their discretion
when they ordered the dismissal of the B.P. 22 cases against Cu.
In Gidwani v. People, wherein several checks that were issued by the President of an exporter of ready-to-
wear clothes in payment of the embroidery services rendered to the exporter were dishonored by the
drawee bank for having been drawn against a closed account by reason of the order by the Securities and
Exchange Commission (SEC) suspending all actions, claims and proceedings against the exporter that the
SEC issued after the exporter filed a petition for declaration of a state of suspension of payments, for the
approval of a rehabilitation plan and appointment of a management committee, the Court ruled:

Considering that there was a lawful Order from the SEC, the contract is deemed suspended. When a
contract is suspended, it temporarily ceases to be operative; and it again becomes operative when a
condition [occurs-] or a situation arises - warranting the termination of the suspension of the contract.

In other words, the SEC Order also created a suspensive condition. When a contract is subject to a
suspensive condition, its birth takes place or its effectivity commences only if and when the event that
constitutes the condition happens or is fulfilled. Thus, at the time [the payee] presented the September and
October 1997 checks for encashment, it had no right to do so, as there was yet no obligation due from [the
exporter, through its President].

Consequently, because there was a suspension of [the exporter's] obligations, [its President] may not be
held liable for civil obligations of the corporation covered by the bank checks at the time this case arose.
However, it must be emphasized that [the President's] non-liability should not prejudice the right of [the
payee] to pursue its claim through the remedies available to it, subject to the SEC proceedings regarding
the application for corporate rehabilitation. (Emphasis and underscoring supplied)

While the facts in present B.P. 22 cases against Cu are not on all fours with those in Gidwani, the Court
finds no reason why the ruling in Gidwani cannot be made to apply to these cases. In Gidwani, the SEC
order of suspension of payments preceded the presentment for encashment of the subject checks therein.
Here, the subject postdated checks were deposited by SB Corp. in October 2008, and dishonored for
reason of "Account Closed," after the closure of G7 Bank and after the PDIC, through its Deputy
Receiver, had taken over G7 Bank, its premises, assets and records on August 1, 2008 and had issued a
cease and desist order against the members of the Board of Directors and officers of G7 Bank and closed
all its deposit accounts with other banks, including its checking account with the LBP against which the
five disputed checks were issued.
G.R. No. 221732, August 23, 2017

FERNANDO U. JUAN v. ROBERTO U. JUAN (SUBSTITUTED BY HIS SON JEFFREY C.

JUAN) AND LAUNDROMATIC CORPORATION

Facts:

Respondent Roberto U. Juan claimed that he began using the name and mark "Lavandera Ko" in his
laundry business on July 4, 1994. He then opened his laundry store at No. 119 Alfaro St., Salcedo St.,
Makati City in 1995. Thereafter, on March 17, 1997, the National Library issued to him a certificate of
copyright over said name and mark. Over the years, the laundry business expanded with numerous
franchise outlets in Metro Manila and other provinces. Respondent Roberto then formed a corporation to
handle the said business, hence, Laundromatic Corporation (Laundromatic) was incorporated in 1997,
while "Lavandera Ko" was registered as a business name on November 13, 1998 with the Department of
Trade and Industry (DTI). Thereafter, respondent Roberto discovered that his brother, petitioner Fernando
was able to register the name and mark "Lavandera Ko" with the Intellectual Property Office (IPO) on
October 18, 2001, the registration of which was filed on June 5, 1995. Respondent Roberto also alleged
that a certain Juliano Nacino (Juliano) had been writing the franchisees of the former threatening them
with criminal and civil cases if they did not stop using the mark and name "Lavandera Ko." It was found
out by respondent Roberto that petitioner Fernando had been selling his own franchises.

Thus, respondent Roberto filed a petition for injunction, unfair competition, infringement of copyright,
cancellation of trademark and name with/and prayer for TRO and Preliminary Injunction with the
Regional Trial Court (RTC) and the case was raffled off at Branch 149, Makati City. The RTC issued a
writ of preliminary injunction against petitioner Fernando in Order dated June 10, 2004. On July 21,
2008, due to the death of respondent Roberto, the latter was substituted by his son, Christian
Juan (Christian). Pre-trial conference was concluded on July 13, 2010 and after the presentation of
evidence of both parties, the RTC rendered a Resolution dated September 23, 2013, dismissing the
petition and ruling that neither of the parties had a right to the exclusive use or appropriation of the mark
"Lavandera Ko" because the same was the original mark and work of a certain Santiago S.
Suarez (Santiago). According to the RTC, the mark in question was created by Suarez in 1942 in his
musical composition called, "Lavandera Ko" and both parties of the present case failed to prove that they
were the originators of the same mark.

Herein petitioner elevated the case to the CA through a notice of appeal. In his appeal, petitioner
contended that a mark is different from a copyright and not interchangeable.

The CA, in its Decision dated May 7, 2015, dismissed the petitioner's appeal based on technical grounds.

Issues:

1. WHETHER OR NOT THE DISMISSAL OF THE APPEAL BY THE COURT OF APPEALS ON

PURELY TECHNICAL GROUNDS WAS PROPER CONSIDERING THAT THE CASE BEFORE IT
CAN BE RESOLVED BASED ON THE BRIEF ITSELF.

No. The petition is meritorious.

Rules of procedure must be used to achieve speedy and efficient administration of justice and not derail
it. Technicality should not be allowed to stand in the way of equitably and completely resolving the rights
and obligations of the parties. It is, settled that liberal construction of the rules may be invoked in
situations where there may be some excusable formal deficiency or error in a pleading, provided that the
same does not subvert the essence of the proceeding and it at least connotes a reasonable attempt at
compliance with the rules. In Aguam v. CA, this Court ruled that:

x x x Technicalities, however, must be avoided. The law abhors technicalities that impede the cause of
justice. The court's primary duty is to render or dispense justice. "A litigation is not a game of
technicalities." "Law suits, unlike duels, are not to be won by a rapier's thrust. Technicality, when it
deserts its proper office as an aid to justice and becomes its great hindrance and chief enemy, deserves
scant consideration from courts." Litigations must be decided on their merits and not on technicality.
Every party litigant must be afforded the amplest opportunity for the proper and just determination of his
cause, free from the unacceptable plea of technicalities. Thus, dismissal of appeals purely on technical
grounds is frowned upon where the policy of the court is to encourage hearings of appeals on their merits
and the rules of procedure ought not to be applied in a very rigid, technical sense; rules of procedure are
used only to help secure, not override substantial justice. It is a far better and more prudent course of
action for the court to excuse a technical lapse and afford the parties a review of the case on appeal to
attain the ends of justice rather than dispose of the case on technicality and cause a grave injustice to the
parties, giving a false impression of speedy disposal of cases while actually resulting in more delay, if not
a miscarriage of justice.

In this case, this Court finds that a liberal construction of the rules is needed due to the novelty of the
issues presented. Besides, petitioner had a reasonable attempt at complying with the rules. After all, the
ends of justice are better served when cases are determined on the merits, not on mere technicality.

2. WHETHER OR NOT A MARK IS THE SAME AS A COPYRIGHT.

No. The law on trademarks, service marks and trade names are found under Part III of Republic Act
(R.A.) No. 8293, or the Intellectual Code of the Philippines, while Part IV of the same law governs
copyrights.

"Lavandera Ko," the mark in question in this case is being used as a trade name or specifically, a service
name since the business in which it pertains involves the rendering of laundry services. Under Section
121.1 of R.A. No. 8293, "mark" is defined as any visible sign capable of distinguishing the goods
(trademark) or services (service mark) of an enterprise and shall include a stamped or marked container of
goods. As such, the basic contention of the parties is, who has the better right to use "Lavandera Ko" as a
service name because Section 165.213 of the said law, guarantees the protection of trade names and
business names even prior to or without registration, against any unlawful act committed by third parties.
A cause of action arises when the subsequent use of any third party of such trade name or business name
would likely mislead the public as such act is considered unlawful. Hence, the RTC erred in denying the
parties the proper determination as to who has the ultimate right to use the said trade name by ruling that
neither of them has the right or a cause of action since "Lavandera Ko" is protected by a copyright.

By their very definitions, copyright and trade or service name are different. Copyright is the right of
literary property as recognized and sanctioned by positive law.14 An intangible, incorporeal right granted
by statute to the author or originator of certain literary or artistic productions, whereby he is invested, for
a limited period, with the sole and exclusive privilege of multiplying copies of the same and publishing
and selling them.15 Trade name, on the other hand, is any designation which (a) is adopted and used by
person to denominate goods which he markets, or services which he renders, or business which he
conducts, or has come to be so used by other, and (b) through its association with such goods, services or
business, has acquired a special significance as the name thereof, and (c) the use of which for the purpose
stated in (a) is prohibited neither by legislative enactment nor by otherwise defined public policy.
As such, "Lavandera Ko," being a musical composition with words is protected under the copyright law
(Part IV, R.A. No. 8293) and not under the trademarks, service marks and trade names law (Part III, R.A.
No. 8293).

In connection therewith, the RTC's basis or source, an article appearing in a website,17 in ruling that the
song entitled "Lavandera Ko" is protected by a copyright, cannot be considered a subject of judicial
notice that does not need further authentication or verification. Judicial notice is the cognizance of certain
facts that judges may properly take and act on without proof because these facts are already known to
them.18 Put differently, it is the assumption by a court of a fact without need of further traditional
evidentiary support. The principle is based on convenience and expediency in securing and introducing
evidence on matters which are not ordinarily capable of dispute and are not bona fide disputed.
G.R. No. 223592 Equitable Insurance Corporation vs. Transmodal International
Inc.

Facts: Sytengco Enterprises Corporation (Sytengco) hired respondent Transmodal to clear from
the custom authorities and withdraw, transport and deliver to its warehouse a cargoes valued at
$21 750, respondent delivered the cargoes to the Sytengco. A survey conducted by Elite
surveyor by elite surveyor and they found that 187 carons had water marks and the content of
the 13 wet cartons were partly hardered. Thus, Sytengco demanded from Transmodal as
compensation of total loss of the shipment. The petitioner Equitable Insurance paid the claim of
Sytengco. Sytengco them signed subrogation receipt and loss receipt favor of petitioner
Equitable Insurance. As such, the petitioner demanded from the respondent Transmodal
reimbursement of the payment given to Sytengco. Petitioner filed a complaint for damages
invoking his right as subrogee, petitioner claim and averred that the respondent’s fault and
negligence were the causes of damages sustained by Sytengco. Transmodal denied and
claimed that petitioner has no cause of action.

The RTC found in favor of petitioner Equitable Insurance, the petitioner was able to prove by
substantial evidence its right to institute an action as subrogee of Sytengco.

Court of appeals reversed the decision of RTC.

Issue: Whether or not the petitioner may claim against the Transmodal as a subrogee.

Held: Yes, it was well established that petitioner has the right to step into the shoes of the
insured who has direct cause of action against herein respondent on account of the damages
sustained by the cargoes. “subrogation is the substitution of one person in the place of another
with reference to a lawful claim or right, so that he substituted succeeds to the rights of the other
relation to a debt or claim.

Petitioner was able to present as the evidence the marine open policy that vested upon it, its
right as subrogee.

Subrogation is designed to promote and to accomplish justice and is the mode, which equity
adopts to compel the ultimate payment debt by one who in justice, equity and good conscience
ought to pay.

Thus, the Equitable Insurance Corporation has the right to claim against the Transmodal as a
subrogee.
G.R. No. 226345 Pioneer Insurance and Surety Corporation vs. APL Co. PTE Ltd.

Facts: The shipper, Chillies Export House Limited turned over to respondent APL, Co. Pte. Ltd. 250 bags
of chili pepper for transport from India to Manila, the cargo was insured with the petitioner. The
shipment was arrived at the port of Manila and was temporarily stored at North Harbour Manila. The
bags of chili were withdrawn and delivered to BSFIL. They discovered that the 76 bags were wet and
heavily infested with molds, the shipment was declared unfit for human consumption. As a result BSFIL
made a formal claim against APL and Pioneer Insurance. The petitioner insurance corporation paid after
evaluating the claim and subrogated to all the rights of BSFIL.

The MTC ruled in favor of the petitioner, the court granted the complaint and ordered APL to pay
Pioneer Insurance.

The RTC concurred with the MTC, it agreed that APL was presumed ti have acted negligently beacuase
the damage were happened in their custody.

CA reversed the decision of the trial court, CA stated that the action was barred by prescription.

Issue: Whether or not the action of the petitioner was barred by prescription.

Held: NO, the Supreme Court recognized the stipulated prescriptive period shorter than their statutory
counterpart are generally valid because they do not affect the shippers remedy. It has long been settled
that in case of loss or damge of cargoes, the one year prescriptive period under the COGSA. It is at this
juncture where the parties are odds, with the Pioneer Insurance claiming that the one year prescriptive
period under the COGSA governs, whereas APL insist that the nine-month prescriptive period under the
bill of lading applies.

The bill of lading between the parties reveals that nine month prescriptive period is not applicable in all
action or claims.As an exception. The nine-month period is inapplicable when there is different period
provided by a law for particular claim or action, the onr-year prescriptive period under the COGSA
should govern because the present case involves loss of goods or cargo. In finding so, the Court does not
construe the Bill of Lading any further but merely applies its terms according to its plain and literal
meaning .

Thus, the action of the petitioner was not barred by prescription.