VALENZUELA HARDWOOD AND INDUSTRIAL SUPPLY INC., petitioner, vs.

COURT OF APPEALS AND SEVEN BROTHERS HIPPING

CORPORATION, respondents.

G.R. No. 102316

June 30, 1997

PANGANIBAN, J.:

DOCTRINE:

 As a private carrier, a stipulation exempting the owner from liability for the negligence of its
agent is not against public policy, and is deemed valid. The Civil Code provisions on common
carriers should not be applied where the carrier is not acting as such but as a private carrier.
 As a general rule, patrimonial rights may be waived as opposed to rights to personality and
family rights which may not be made the subject of waiver.

FACTS:

Petitioner Valenzuela Hardwood entered into an agreement with defendant Seven

Brothers for the transportation of logs from Isabela to Manila, on board the latter’s vessel
M/V Seven Ambassador. The logs were insured by petitioner with respondent South Sea
Surety and Insurance Co., Inc. (South Sea Surety) for P2,000,000.00.

However, the vessel sank. South Sea Surety cancelled the policy, alleging non-
payment of insurance premium despite issuance by petitioner of a check and tender thereof,
which was unaccepted by respondent South Sea Surety.

The trial court ruled in favor of petitioner Valenzuela Hardwood and against
respondents. On appeal, sustained the finding of liability on the part of South Sea Surety and
held respondent Seven Brothers not liable. Hence, this petition.

ISSUE:

Whether or not the stipulation in the charter party executed between the petitioner
and private respondent exempting the latter from liability for the loss of petitioner’s logs
arising from the negligence of its captain is valid.

RULING:

Yes. It is undisputed that the cause of the loss of the logs is the negligence of the
caption of the vessel Seven Ambassador and that the private respondent, per their
agreement, acts as a private carrier.

In the case at bar, the Supreme Court applied the doctrine of stare decisis as embodied
under Article 8 of the Civil Code. As held in an earlier case, Home Insurance Co. vs. American
Steamship Agencies, Inc., it was held that:

“The provisions of our Civil Code on common carriers were taken

from Anglo-American law. Under American jurisprudence, a common
carrier undertaking to carry a special cargo or chartered to a special person
only, becomes a private carrier. As a private carrier, a stipulation exempting
the owner from liability for the negligence of its agent is not against public
policy, and is deemed valid.
 Such doctrine We find reasonable. The Civil Code provisions on common
carriers should not be applied where the carrier is not acting as such but as a
private carrier. The stipulation in the charter party absolving the owner
from liability for loss due to the negligence of its agent would be void if the
strict public policy governing common carriers is applied. Such policy has
no force where the public at large is not involved, as in this case of a ship
totally chartered for the used of a single party.”

Applying the above-quoted jurisprudence in the instant case, Seven Brothers is not
to be held liable.

Further, applying Article 6 of the Civil Code, petitioner waived its rights provided
under the Code of Commerce by acceding to the contractual stipulation that it is solely
responsible or any damage to the cargo, thereby exempting the private carrier from any
responsibility for loss or damage thereto.

Dispositive Portion:

WHEREFORE, premises considered, the petition is hereby DENIED for its utter failure to
show any reversible error on the part of Respondent Court. The assailed Decision is
AFFIRMED.

SO ORDERED.