Ace Navigation Navigation Co. Inc., petitioner petitioner v. FGU Insurance Corporation Corporation and Pioneer Insurance and Surety Corporation, respondents Facts: Cardia Limited shipped shipped on board the vessel vessel M/V Pakarti Tiga at Shanghai Shanghai Port, China, 8260 metric tons (or 165,200 bags) of Grey Portland Cement to be discharged at the Port of Manila and delivered to its consignee, Heindrich Trading Corp. The subject shipment was insured with respondents FGU Insurance Corp. and Pioneer Insurance and Surety Corp. against all risks for the amount of Php 18,048,421.00. Regency Express Express Lines S.A., chartered chartered by Sky International, Inc. having entered into a contract with Shinwa Kaiun Kaisha Ltd. to which the subject vessel was chartered by the owner Pakarti Tata, was the one which directly dealt with Heindrich and accordingly issued Clean Bill of Lading No. SM-1. The vessel arrived at the Port of Manila and the shipment was discharged. Upon inspection by Heindrich and Ace Navigation Co. Inc, agent of Cardia Limited, it was found that out of the 165,200 bags of cement, 43,905 bags were in bad order and condition. The respondents, unable to collect the sustained damages from Cardia Limited and Regency Express Lines S.A., each paid Heindrich separately totaling to Php 711,727.34 and became sub rated to all the rights and causes of action accruing to Heindrich. Respondents filed a complaint for damages. Ace Navigation Navigation Co. Inc. claimed claimed it was not a real real party-in-interest from whom the respondents can demand compensation. The respondents maintain that Ace Navigation Co. Inc is a ship agent and not a mere agent of Cardia, as found by both the CA and the RTC. Issue: Whether or not Ace Navigation Co. Inc. be held liable for damages sought by FGU Insurance Corporation and Pioneer Insurance and Surety Corporation. Decision: Article 586 of the Code of Commerce provides that “the ship owner and the ship agent shall be civilly liable for the acts of the captain and for the obligations contracted by the latter to repair, equip and provision the vessel, provided the creditor proves the amount claimed was invested therein. therein. By ship agent is understood the person entrusted with the provisioning of a vessel, or who represents her in the port in which she may be found.” Due to the abov e
provision, the Court disagreed with respondents’ contention. Thus, Ace Navigation Co. Inc. cannot be held liable for damages sought by the respondents.
