Asian Terminals Inc v. Allied Guarantee Insurance Co., Inc, GR No.

182208, 14 Oct 2015

Whatistheliabilityofarrastreoperatorsincaseoflossordamageofthegoods?
InAsianTerminals,Inc.v.AlliedGuaranteeInsuranceCo.,Inc.(G.R.No.182208,14October2015),a
shipment72,322lbs.ofkraftlinearboardwereoffloadedbythearrastre,MarinaPortServices,Inc.
(Marina),thepredecessorofpetitionerAsianTerminals,Inc.(ATI).Saidgoodswereshippedonboardthe
vesselM/VNicole,whichwasoperatedbyTransoceanMarine,Inc.(Transocean),representedinthe
PhilippinesbyPhilippineTransmarineCarrier,Inc.(PhilippineTransmarine).
Afteroffloading,atotalof158rollsofthegoodsweredamagedduringshipping.Anadditional54rollswere
foundtohavebeendamagedwhileinthecustodyofMarinaandSanMiguelsbroker,DynamicBrokerageCo.
Inc.(Dynamic).Theinsurer,AlliedGuaranteeInsurance,Co.,Inc.(Allied)paidtheconsigneethevalueof
thedamagedgoods.AlliedsuedTransocean,PhilippineTransmarine,Dynamic,andMarinafordamages.
ThetrialcourtheldTransoceanliableforthe158rollsofdamagedgoodsforfailuretoobservethenecessary
precautionsandextraordinarydiligenceasacommoncarriertopreventsuchdamage.MarinaandDynamic
werealsoheldliablefortheadditional54rollsofthegoodsthatweredamagedwhileintheirrespective
possessions.ThisrulingwasaffirmedbytheCourtofAppeals.
ATI,assuccessorofMarina,elevatedtheforegoingmattertotheSupremeCourt,andinsistedthatitisnot
liableforthedamaged54rolls.ATIclaimsthattheappellatecourtfailedtoappreciatetheTurnOverSurvey
ofBadOrderCargoesandtheRequestsforBadOrderSurveywhich,inessence,showedthatthegoodswere
receivedbyDynamicingoodorderandconditionwithoutexceptionandthatonly158rollsweredamaged.
InrulingagainstATI,theSupremeCourtreiteratedthehornbookdoctrinethat,intheperformanceofits
obligations,anarrastreoperatorshouldobservethesamedegreeofdiligenceasthatrequiredofacommon
carrierandawarehouseman.Accordingly,anarrastreoperatormustprovethatthelosseswerenotduetoits
negligenceorofitsemployees,andmustprovethatitexercisedduecareinhandlingthegoods.Thisburden,
however,wasnotestablishedbyATIanditwasfoundthattheadditionaldamageofthe54rollsoccurred:(1)

whilethegoodswereinitscustodyofATI;(2)whentheywereintransitionfromATItoDynamic;and(3)
duringDynamicscustody.
Finally,theSupremeCourtdisregardedATIsheavyrelianceontheTurnOverSurveyofBadOrderCargoes
andtheRequestsforBadOrderSurvey.TheSupremeCourtsaidthat,Thesignaturebyacustomsbrokers
representativeofreceiptingoodorderdoesnotprecludeaconsigneeand/orsubrogeefromproving
additionallossordamagetothegoodswhilethesamewasunderthecustody,control,andpossessionofthe
arrastreoperator.