Valenzuela Hardwood & Industrial Supply, Inc. v. CA et al. (Case Digest) G.R. No. 102316

Valenzuela Hardwood & Industrial Supply, Inc. v. CA et al.
G.R. No. 102316
June 30, 1997

VALENZUELA HARDWOOD AND INDUSTRIAL SUPPLY, INC., petitioner, vs.
COURT OF APPEALS AND SEVEN BROTHERS SHIPPING CORPORATION, respondents.

Facts:
On January 16, 1984, Valenzuela Hardwood and Industrial Supply, Inc. entered into an agreement with the Seven Brothers Shipping Corporation. The latter was to deliver the former’s lauan round logs using its vessel, M/V Seven Ambassador. According to their charter, the shipping corporation should not be held liable for loss, split, or breakages and any kind of damage to the cargo. On January 25, 1984, the vessel sank, resulting in the loss of logs. Valenzuela then contended that the stipulation in the charter regarding the non-liability of the respondents is void for being contrary to public policy in relation to Article 1745 of the Civil Code.

Issue:
Did Valenzuela Hardwood waive its rights for obtaining payment for damages when it entered into the charter?

Ruling:
Yes. The charter entered into by Valenzuela stipulated that the shipping company may not be held liable in case of loss or damage of the cargo. The petitioner cannot reason that the stipulation is contrary to public policy since the nature of the job entails carrying a special cargo, making the common carrier a private carrier. Contrary to the rules regarding public carriers, in a contract of private carriage, the parties may validly stipulate that the responsibility of the cargo rests solely on the charterer even if the damage was caused by the negligence of the ship captain.

The provisions of the Civil Code regarding common carriers were taken from Anglo-American law. And according to American jurisprudence, a common carrier undertaking to carry a special cargo becomes a private carrier. In cases where a private carrier is concerned, a stipulation exempting the carrier from liability is valid. The Civil Code provisions on common carrier are not applicable in this case. In addition, while Article 6 of the Civil Code provides that rights may be waived unless the waiver is contrary to public policy, in this case, the job is not imbued with public considerations since the contract affects only the petitioner and respondent.