CARRIAGE OF GOODS BY THE SEA ACT (COGSA)

Michelle C. Arias1 October 2010

Background of the COGSATIMELINE:April 16, 1936

– Public Act No. 521 aka COGSA was approved by the 74th US Congress October 22, 1936

– COGSA was made applicable to the Philippines upon the election and approval of Commonwealth Act No. 55 by the National Assembly of the Commonwealth Government

1936-1950

COGSA governed contracts of carriage of goods by sea from the US to Philippine ports.

August 30, 1950

– the New Civil Code of 1949 (RA 386) came into effect

Purpose of the COGSAgoverns the rights and responsibilities

between shippers of cargo and ship-owners regarding ocean shipments

defines the terms used in shipping

prescribes the maximum amount for the limitation of the ship-owner’s liability

stipulates the period for prescription

Applicability of the COGSAREQUISITES1.There must be a contract of carriage

between the ship-owner or its agent and the shipper;

2.The contract must be for the carriage of goods;

3.For transportation by sea; and4.in foreign trade, UNLESS expressly agreed

upon by the parties to apply in domestic shipping.

Applicability of the COGSAGOVERNING LAW1. Private Carrier coming to the Philippines

First: COGSASecond: Code of CommerceThird: Civil Code as to provisions

for damages, torts, and contracts

Applicability of the COGSAGOVERNING LAW2. Common Carrier coming to the Philippines

First: Civil Code provisions on common carriers

Second: COGSAThird: Code of Commerce

Applicability of the COGSAGOVERNING LAW3. Private or Common Carrier going to a

foreign countryGeneral Rule: Law of the country of destination as provided by Art. 1753 of the Civil CodeException: Expressly agreed upon by the parties

DEFINITION OF TERMS (Sec.1)(a) "carrier" includes the owner or the charterer who enters into a contract

of carriage with a shipper.

(b) "contract of carriage" applies only to contracts of carriage covered by a bill of lading or any similar document of title, insofar as such document relates to the carriage of goods by sea, including any bill of lading or any similar document as aforesaid issued under or pursuant to a charter party from the moment at which such bill of lading or similar document of title regulates the relations between a carrier and a holder of the same.

(c) "goods" includes goods, wares, merchandise, and articles of every kind whatsoever, except live animals and cargo which by the contract of carriage is stated as being carried on deck and is so carried.

(d) "ship" means any vessel used for the carriage of goods by sea.

(e) "carriage of goods" covers the period from the time when the goods definitiare loaded on to the time when they are discharged from the ship.

RISKS (Sec. 2)General Rule is that

“under every contract of carriage of goods by sea, the carrier in relation to the loading, handling, stowage, carriage, custody, care and discharge of such goods, shall be subject to the responsibilities and liabilities in Section 3 and entitled to the rights and immunities in Section 4.”

SPECIAL CONDITIONS (Sec. 6)Exception is that

“a carrier, master or agent of the carrier and a shipper may enter into any agreement in any terms as to:

1.the responsibility and liability of the carrier for such goods, and as to the rights and immunities of the carrier in respect of such goods; or

2.his obligation as to seaworthiness in so far as not contrary to public policy; or

3.the care or diligence of his servants or agents in regard to the loading, handling, stowage, carriage, custody, care and discharge of goods carried by sea.”

SPECIAL CONDITIONS (Sec. 6)HOWEVER, the foregoing shall apply only where no bill of lading has been or shall be issued AND that the terms agreed shall be embodied in a receipt which shall be a non-negotiable document and shall be marked as such.

Such agreement shall have full legal effect. However, it will NOT apply to ordinary commercial shipments made in the ordinary course of trade but only to other shipments where the character or condition of the property to be carried or the circumstance, terms and condition under which the carriage is to be performed are such as reasonably to justify a special agreement.

SEAWORTHYRESPONSIBILITIES & LIABILITIES (Sec. 3)

(1) The carrier shall be bound, before and at the beginning of the voyage, to exercise due diligence to — (a) Make the ship seaworthy;(b) Properly man, equip, and supply the ship;(c) Make the holds, refrigerating and cooling chambers, and all other parts of the ship in which goods are carried, fit and safe for their reception carriage and preservation.

(2) The carrier shall properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried.


When is a vessel “SEAWORTHY”?- if it is reasonably fit - to encounter the ordinary perils to be

expected during her voyage, - to receive and discharge cargo, and - to carry safely the particular cargo on the

voyage undertaken.


“Absolute perfection is not required in the vessel, it being sufficient that she have that degree of fitness which an ordinarily careful and prudent owner would require his vessel to have at the commencement of her voyage having regard to all the probable circumstances of it.”

(The Silvia, 68 Fed. 230)


“A vessel must also be provided with a crew adequate in number and competent for their duty with reference to all the exigencies of the intended route, and with a competent and skillful master, of sound judgment and discretion, and with sufficient knowledge of the route and experience in navigation to be able to perform in a proper manner all the ordinary duties required of him as master of the vessel.”

(Germania Insurance Co. vs. The Lady Pike, 21 US 1, 22 L. ed., 499)


“The carrier is under obligation to properly stow cargo. A vessel, in herself seaworthy, may be rendered unseaworthy by improper loading of cargo.”

(The City of Lincoln vs. Smith, [1904] A.C. 250)

“Bad storage. Which endangers the safety of the ship and cannot readily be cured on the voyages, is unseaworthiness.” (Ingram & Royle, Ltd. vs. Services Martimes du Treport,

1 K.B. 541)


When Seaworthiness Must Exist:at the beginning of the voyage, orat the time she sails, orwhen she breaks ground.” (58 CJ 450)

BILL OF LADING RESPONSIBILITIES & LIABILITIES (Sec. 3)(3) After receiving the goods into his charge the carrier, or the master or

agent of the carrier, shall, on demand of the shipper, issue to the shipper a bill of lading showing among other things —

(a) The leading marks necessary for identification of the goods as the same are furnished in writing by the shipper before the loading of such goods starts, provided such marks are stamped or otherwise shown clearly upon the goods if uncovered, or on the cases or coverings in which such goods are contained, in such a manner as should ordinarily remain legible until the end of the voyage.

(b) Either the number of packages or pieces, or the quantity or weight, as the case may be, as furnished in writing by the shipper.

(c) The apparent order and condition of the goods: Provided, That no carrier, master, or agent of the carrier, shall be bound to state or show in the bill of lading any marks, number, quantity, or weight which he has reasonable ground for suspecting not accurately to represent the goods actually received, or which he has had no reasonable means of checking.

BILL OF LADING RESPONSIBILITIES & LIABILITIES (Sec. 3)

(4) Such a bill of lading shall be prima facie evidence of the receipt by the carrier of the goods as therein described in accordance with paragraphs (3) (a), (b), and (c) of this section.

(5) The shipper shall be deemed to have guaranteed to the carrier the accuracy at the time of shipment of the marks, number, quantity, and weight, as furnished by him; and the shipper shall indemnify the carrier against all loss damages, and expenses arising or resulting from inaccuracies in such particulars. The right of the carrier to such indemnity shall in no way limit his responsibility and liability under the contract of carriage or to any person other than the shipper.


7) After the goods are loaded the bill of lading to be issued by the carrier, master, or agent of the carrier to the shipper shall, if the shipper so demands, be a "shipped" bill of lading

Provided, That if the shipper shall have previously taken up any document of title to such goods, he shall surrender the same as against the issue of the "shipped" bill of lading, but at the option of the carrier such document of title may be noted at the port of shipment by the carrier, master, or agent with name or name the names of the ship or ships upon which the goods have been shipped and the date or dates of shipment, and when so noted the same shall for the purpose of this section be deemed to constitute a "shipped" bill of lading.

BILL OF LADING RESPONSIBILITIES & LIABILITIES (Sec. 3)What is a Bill of Lading?

It is a document issued by a carrier to a shipper, acknowledging that specified goods have been received on board as cargo for conveyance to a named place for delivery to the consignee who is usually identified. (Wikipedia)

A document signed by a carrier (a transporter of goods) or the carrier's representative and issued to a consignor (the shipper of goods) that evidences the receipt of goods for shipment to a specified designation and person. (The Legal Dictionary)

1. evidence of a valid contract of carriage, or a chartering contract, 2. receipt signed by the carrier confirming whether goods matching the contract description have been received in good condition; and3. a document of transfer


What does a Bill of Lading contain?(a) The leading marks necessary for identification of the goods(b) Either the number of packages or pieces, or the quantity or weight,(c) The apparent order and condition of the goods [Sec.3 (3)]

Other information contained in a bill of lading:

Name of the shipping company Flag of nationality Shipper’s name Order and notify party


Who issues a Bill of Lading?The carrier, or the master or agent of the carrier

When is a Bill of Lading issued? After receipt by the carrier of the goods for shipping

To whom is a Bill of Lading issued?To the shipper, upon his demand


What is the purpose of a Bill of Lading?- It is the prima facie evidence of the receipt by the carrier of the goods as therein described. [Sec. 3 (4)]- It guarantees the accuracy of the mark, number, quantity and weight of the goods as furnished by the shipper. [Sec. 3 (5)]- Effect of Inaccuracy: shipper becomes liable for indemnity to the carrier. [Sec. 3 (5)]

LIMITATION OF LIABILITY RIGHT AND IMMUNITIES (Sec. 4)Art. 1749 Civil Code - expressly permits a stipulation

limiting the liability of a common carrier to the value of the goods appearing in the bill of lading.

COGSA [Sec.4 (5)] – suppletory to the Civil Code, limits the carrier’s liability to $600 per package in the absence of a declaration of a higher value of the goods by the shipper in the bill of lading

The provisions of the Carriage of Goods by Sea Act on limited liability are as much a part of a bill of lading as though physically in it and as much a part thereof as though placed therein by agreement of the parties.

(Eastern Shipping Lines, Inc. v. IAC, 150 SCRA 463)

LIMITATION OF LIABILITY RIGHT AND IMMUNITIES (Sec. 4)

Since there is no stipulation in the respective bills of lading, limiting the carrier’s liability for the loss or destruction of the goods, nor is there a declaration of a higher value of the goods, then the provisions of the Civil Code (Arts. 1739 & 1750) do not apply. Hence, the carrier’s liability will be under the COGSA, as suppletory law, and will not exceed US$500 per package or its peso equivalent, at the time of payment of the value of goods lost, but in no case “more than the amount of damage actually sustained.”

LIMITATION OF LIABILITY RIGHT AND IMMUNITIES (Sec. 4)Section 4(5). “Neither the carrier nor the ship shall in any event be or become

liable for any loss or damage to or in connection with the transportation of goods in an amount exceeding $500 per package lawful money of the United States, or in case of goods not shipped in packages, per customary freight unit, or the equivalent of that sum in other currency, unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading. This declaration, if embodied in the bill of lading, shall be prima facie evidence, but shall not be conclusive on the carrier.

By agreement between the carrier, master, or agent of the carrier, and the shipper another maximum amount than that mentioned in this paragraph may be fixed: Provided, That such maximum shall not be less than the figure above named. In no event shall the carrier be liable for more than the amount of damage actually sustained.

Neither the carrier nor the ship shall be responsible in any event for loss or damage

to or in connection with the transportation of the goods if the nature or value thereof has been knowingly and fraudulently misstated by the shipper in the bill of lading.”

BILL OF LADINGRESPONSIBILITIES & LIABILITIES (Sec. 3)

(8) Any clause, covenant, or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with the goods, arising from negligence, fault, or failure in the duties and obligations provided in this section, or lessening such liability otherwise than as provided in this Act, shall be null and void and of no effect. A benefit of insurance in favor of the carrier, or similar clause, shall be deemed to be a clause relieving the carrier from liability.


What do you mean by “Package”?

Package refers to cartons or the individual packaging of the goods and not to containers.


CONDITIONS FOR LIMITATION OF LIABILITY:1. Stipulation to limit liability, no higher value

declared for the goods- apply the maximum liability in COGSA:a) $500 per package, orb) Per customary freight unit

Ex. Value of package: $700No higher value declaredLimitation on Liability: $500Recover: $500/package


2. Stipulation to limit liability, shipper declared a higher valuation and paid the proper adjustment fees- the shipper may recover the value of the lost or damaged goods at the time payment is to be made

Ex. Declared value of the package: $700 - with payment of corresponding charges Value of package

at the time of payment: $700 Recover: $700

( or as provided in the carrier’s schedule of limited liability)


3. No stipulation to limit liability, No higher value declared - apply the maximum liability in COGSA:a) $500 per package, orb) Per customary freight unit

- PROVIDED: “not more than the amount of damage actually sustained”

Ex. Value of the package: $800 Damage sustained: $400 $800

Maximum Liability: $500 Recover: $400 $500


4. Stipulation to limit liability, parties agree that the carrier’s liability shall be more than $500/package? VALID or NOT?- apply the higher limit on liability as agreed upon

5. Stipulation to limit liability below $500/package provided in COGSA? VALID or NOT?- apply the lower limit on liability as agreed upon by the parties in the Bill of Lading


“By providing that $500 per package is the maximum liability, the law does not disallow an agreement for liability at a lesser amount.

The second paragraph of Sec. 4 (5) of the COGSA prescribing the maximum amount shall not be less than $500 refers to a situation where there is an agreement other than set forth in the Bill of Lading providing for a maximum higher than $500 per package.”

(Eastern and Australian Steamship Co. Ltd. vs. Great American Ins. Co., 108 SCRA 248)


6. “Neither the carrier nor the ship shall be responsible in any event for loss or damage to or in connection with the transportation of the goods if the nature or value thereof has been knowingly and fraudulently misstated by the shipper in the bill of lading.”

7. “A stipulation relieving the carrier or the ship from liability for loss or damage to or in connection with the goods, arising from negligence, fault, or failure in the duties and obligations, or lessening such liability, shall be null and void and of no effect.” [Sec. 3 (8)]

PERIOD OF PRESCRIPTIONRESPONSIBILITIES & LIABILITIES (Sec. 3)

(6) Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading. If the loss or damage is not apparent, the notice must be given within three days of the delivery.


Said notice of loss or damage maybe endorsed upon the receipt for the goods given by the person taking delivery thereof.

The notice in writing need not be given if the state of the goods has at the time of their receipt been the subject of joint survey or inspection.


In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered:

Provided, That if a notice of loss or damage, either apparent or concealed, is not given as provided for in this section, that fact shall not affect or prejudice the right of the shipper to bring suit within one year after the delivery of the goods or the date when the goods should have been delivered


In the case of any actual or apprehended loss or damage the carrier and the receiver shall give all reasonable facilities to each other for inspecting and tallying the goods.


General Rule: The carrier and the agent shall be discharged from liability in respect of loss or damage to the goods carried by sea unless suit is brought within one (1) year:

In case of damaged goods: after delivery was made

In case of non-delivery of goods (i.e. lost) after the date when the goods should have been

delivered (or the date when the ship left the port of destination).


WHY ONE (1) YEAR?

- to meet the exigencies of maritime hazards;

- to provide the carrier an opportunity to look for the lost goods;

- to discover who was at fault; and - in case of transshipment, to determine, when and where the damage occurred


How to Compute:Exclude the first day, include the last day.

Ex. The ship left the port on Sept. 30, 2010. The prescriptive period commenced to run on Oct. 1, 2010 and expired on Sept. 30, 2011.


What do we mean by DELIVERY?- delivery to the arrastre operator and NOT to the

consignee .

Why? “That delivery is evidenced by tally sheets which show whether the goods were landed in good order or in bad order, a fact which the consignee or shipper can easily ascertain through the customs broker. To use as basis for computing the one-year period the delivery to the consignee would be unrealistic and might generate confusion between the loss or damage sustained by the goods while in the carrier’s custody and the loss or damage caused to the goods while in the arrastre operator’s possession.” (Union Carbide Phils., Inc. vs. Manila Railroad Co., 77 SCRA 359)

“Carrier is liable over goods discharged by it in bad order condition, and the arrastre operator for goods damaged under its custody.”(Metro Port service, Inc. vs. CA, 131 SCRA 365)


When is there “LOSS”?“As defined in Article 1169 of the New Civil Code and as applied to

paragraph 4, Section 3(6) of the COGSA,

LOSS contemplates merely a situation where no delivery at all was made by the shipper of the goods because the same (1) had perished, (2) gone out of commerce, or (3) disappeared in such a way that their existence is unknown

or they cannot be recovered.

It does not include a situation where there was indeed delivery but delivery was to the wrong person, or a misdelivery. Non-delivery should be distinguished from misdelivery.” (Ang vs American Steamship Agencies, Inc., 19 SCRA 123)


What is MISDELIVERY or CONVERSION of goods- delivery to the wrong person

The one-year prescriptive period in Section 3(6) applies only when there is loss or damage. In case of misdelivery or conversion, the rules on prescription found in the Civil Code shall apply:

Breach of a Written ContractTen (10) years from the time

the right of action accrues (Art. 1144 NCC)Quasi-Delict

Four (4) years from the time the right of action accrues (Art. 1146 NCC)

COGSA may still apply to a transshipment of cargo via inter-island vessel

In the case of American Insurance Co. vs. Compania Maritima (21 SCRA 998), a contract for carriage from New York, USA with final destination in Cebu City, Philippines was entered into. From US to Manila the shipment was on board M/S TOREADOR; and from Manila to Cebu the shipment was loaded on S/S SIQUIJOR. The transshipment of the cargo from Manila to Cebu was not a separate transaction from that originally entered into by Macondray, as general agent for the M/S Toreador. It was part of Macondray’s obligation under the contract of carriage and the fact that the transshipment as made via an interisland vessel did not operate to remove the transaction from the operation of the COGSA.


1. Extrajudicial demand for loss or damage does NOT interrupt the period of prescription. (Dole Phils., Inc. vs. Maritime Co. of the Philippines, 148 SCRA 118)

2. Pendency of an extrajudicial claim for damages (include arbitration, negotiations, amicable settlement) filed with the carrier does NOT suspend the running of the prescriptive period, unless there is an express agreement to the contrary. (Chua Kuy vs. Everett Steamship Corporation, G.R. No. L-5554, May 27, 1953)


3. Prescription of actions is interrupted when they are filed before the court (Art. 1155 NCC). Also Section 49 of Act No. 190 provides that if, in an action commenced in due time, the plaintiff fails otherwise than upon the merits, and the time limited for the commencement of such action has, at the date of such failure, expired, the plaintiff may commence a new action within one year after such date. (F.H. Stevens & Co., Inc. vs. Norddeuscher Llyod, 6 SCRA 182-183)


4. Persons who can give notice to, and bring suit against the carrier: (a) the shipper, or (b) the consignee, or (c) any legal holder of the bill of lading, like the indorsee or the subrogee, (Chua Kuy vs. Everett Steamship Corporation, G.R. No. L-5554, May 27, 1953) such as an insurer whether it has or has not yet paid the shipper or consignee. (Filipino Merchants Insurance Co., vs. Alejandro, 145 SCRA 42)

5. Provisions in the bill of lading contrary to prescription periods of the COGSA are null and void. (E.E. Elser, Inc. vs. CA, et al., GR No. L-6517, Nov. 29, 1954).


* Note that the COGSA is only applicable in (1) contracts of carriage of (2) goods (3) by sea in (4) foreign trade. However, the parties to a domestic maritime trade may, by express stipulation, validly agree to incorporate the provisions of the COGSA in their contract of carriage, in which case said Act is applicable; provided that a contractual clause in the bill of lading limiting the liability of the Carrier in a manner contrary to the provisions of the COGSA shall be null and void.


6. If the goods are lost or damaged by reason of an unjustified delay in transportation, the carrier is liable therefor; and the action must be filed within the prescriptive period provided by the COGSA. (Tan Liao vs. American President Lines, Ltd., GR No. L-7280, Jan. 20, 1956)

7. Suit against an arrastre operator is not within the coverage of the COGSA, the ordinary periods of prescription will apply. (Insurance Co. of North America vs. Phil. Ports Terminal, Inc. GR No. L-6420, July 18, 1955)


8. When will the one-year prescriptive period not apply to an insurer?

When the insurer seeks to recover from the shipper the sum it had indemnified the owner of the vessel for the value of copra which it is claimed the defendant failed to load for shipment to the consignees and the value of which the carrier had paid to the consignees, the plaintiff’s cause of action is not yet barred by the statute of limitations in the COGSA.

RIGHTS & IMMUNITIES (Sec. 4)What constitutes due diligence in making vessel

“seaworthy”?

Due diligence requires such watchful caution and foresight as the circumstance of the particular service demand. It must be adequate to the occasion. It must be due diligence in the work itself, and not merely in the selection of agents to do the work; otherwise, shipowner might escape all responsibility merely by selecting agents of good reputation and would be relieved whether such agents exercised due care or not to make their vessel seaworthy, and any responsibility would be fritted away.” (Nord-Deutscher Lloyd vs. Insurance Co. of North America, 110 Fed. 421)

RIGHTS & IMMUNITIES (Sec. 4)What does “dangers of the sea” mean?

“The phrase “dangers of the sea” has been construed as equivalent to “perils of the sea”. (Baxter vs. Leland, 2 F. Cas. 1, 123) Dangers of the sea is somewhat of an equivocal expression. It may, without any violation of its natural import, be interpreted to mean dangers that arise upon the sea, which would include every hazard and danger, from the beginning to the end of the voyage, of whatever kind or with equal propriety, it may mean only those which arise directly and exclusively from the sea and of which it is the efficient cause. Sometimes it is taken in one sense and sometimes in the another.” (Merril vs. Arey. 17 F. Cas. No. 9, 468)

RIGHTS & IMMUNITIES (Sec. 4)What is the meaning of the term “act of God”?

“The most comprehensive definition of the term is any accident, due directly and exclusively to natural causes without human intervention, which no amount of foresight, pains or care, reasonably to have been expected, could have prevented. (1 CJ 1174) There is an unanimous concurrence in the authorities that an occurrence which is produced wholly or partially by the intervention of human agencies is not an act of God within the meaning of the law. (Kirby vs. Wylie, 108 Md. 501, 70 Atl. 213) All the cases agree in requiring the entire exclusions of human agency form the cause of the injury or loss.” (Michaels vs. New York Cent. R. Co., 30 NY 564, 86 Am. D. 415)

CASES: Ang v. American Steamship AgenciesFACTS:• Yau Yue Commercial Bank of Hong Kong agreed to sell

galvanized sheets to Hermino Teves. It was their agreement that the purchase price will be covered by a bank draft which Teves would pay in exchange for the bill of lading to be deposited in HSBC Manila. Teves would then present the bill of lading to the carrier’s agent, American Steamship which would issue a “Permit to Deliver Imported Articles” to be presented to the Bureau of Customs for the release of the articles.

• The articles were shipped from Japan to the Philippines through Nissho Shipping Co., Ltd via the S.S. Tensai Maru, of which American Steamship is its agent in the Philippines.

CASES: Ang v. American Steamship Agencies• When the articles arrived in Manila on May 9, 1961, Teves failed

to pay. The Bank returned the bill of lading and the draft to Yau Yue which indorsed the bill to Domingo Ang. Teves, however was able to obtain a bank guarantee in favor of American Steamship. He was then able to get the permits and have the articles released to him.

• When Ang claimed the articles , American Steamship said that they have been delivered to Teves. On October 30, 1963, Ang instituted a suit at the CFI of Manila against American Steamship alleging that they have wrongfully delivered and/or converted the goods covered by the bill of lading belonging to Ang. The trial court dismissed the case on the ground of prescription, it having been filed only on October 30, 1963, more than one year after the date of the vessel’s arrival on May 9, 1961.

CASES: Ang v. American Steamship AgenciesISSUE:Whether or not the action against the ship owner has prescribed under Sec.

3(6) par. 4 of the COGSA?

HELD/RATIO:NO. In order to determine the applicable period of prescription, the court must determine whether there has been loss or damage. It was admitted by both parties that no damage was made to the articles. Whether there was loss as stated in COGSA must be read in relation to the Civil Code, Article 1189.

As defined in Article 1169 of the New Civil Code and as applied to paragraph 4, Section 3(6) of the COGSA, LOSS contemplates merely a situation where no delivery at all was made by the shipper of the goods because the same had perished, gone out of commerce, or disappeared in such a way that their existence is unknown or they cannot be recovered. It does not include a situation where there was indeed delivery but delivery – but delivery to the wrong person, or a misdelivery.

CASES: Ang v. American Steamship Agencies

In this case, there was delivery of the goods to Teves, such that there can only be either delviery, if Teves was entitled to receive them, or misdelivery if he wasn’t.

There being no loss or damage to the goods, the one-year time bar in par.4, sec.3 (6) of the COGSA, which refers to “loss or damage”, does NOT apply. Said one-year period of limitation is designed to meet the exigencies of maritime hazards. In a case where the goods shipped were neither lost nor damaged in transit but were, on the contrary, delivered in part to someone who claimed to be entitled thereto, the situation is different, and the special need for the short period of limitation in cases of loss or damage caused by maritime perils does not obtain.

CASES: Ang v. American Steamship Agencies

For suits not predicated upon loss or damaged but on alleged misdelivery or conversion of the goods, the applicable rule on prescription is that found in the New civil Code, i.e., either ten years for Breach of a written contract or four years for quasi-delict (Arts. 1144, 1146, Civil Code), and not the rule on prescription in the COGSA.

Ang’s right of action would have accrued at least on May 9, 1961 when the ship arrived in Manila, and since he filed the suit on October 30, 1963, he was well within the period of limitation.

CASES:F.H. Stevens v. Norddeuscher LloydFACTS:Stevens shipped from Hamburg, Germany to Manila,

aboard the M/S Schwabenstein, a vessel of Lloyd, 2,000 pieces of prismatical thermometers valued at $650. Upon examination of the case containing the goods, it turned out that 1,154 pieces of said thermometers valued at $342.74, were missing and/or destroyed.

May 21, 1959 – notice of the delivery was given to Stevens by the master of the vessel

April 27, 1960 – Stevens instituted an action in the MTC of Manila against the carrier , Lloyd to recover damages

CASES: F.H. Stevens v. Norddeuscher LloydJune 13, 1960 – action in the MTC was dismissed on the

ground of lack of jurisdiction over the subject-matter, being an admiralty case

June 24, 1960 – action in the CFI of Manila was commencedLloyd moved to dismiss the case on the ground of

prescription, the action having been filed more than one year from May 21, 1959 when goods were, or ought to be, delivered.

Stevens contended that the period of prescription was suspended by the commencement of the first action in the MTC, the running of said period resumed or continued on June 13, 1960, and that excluding the period from April 27 – June 13, 1960 less than one (1) year has elapsed

CASES: F.H. Stevens v. Norddeuscher Lloyd

ISSUE: Whether or not the cause of action has prescribed?

HELD/RATIO: NO. Prescription of actions is interrupted when they are filed before the court (Art. 1155 NCC). Also Section 49 of Act No. 190 provides that if, in an action commenced in due time, the plaintiff fails otherwise than upon the merits, and the time limited for the commencement of such action has, at the date of such failure, expired, the plaintiff may commence a new action within one year after such date.

The action commenced by the plaintiff in the MTC of Manila, on April 27, 1960, was dismissed on June 13, 1960, or over twenty (20) days after the expiration of the period of one (1) year, beginning from May 21, 1959, within which plaintiff’s action could be brought, pursuant to CA 65, in relation to the COGSA. Under said section 49nof Act No. 190, the period within which plaintiff could initiate the present case was renewed, therefore, for another year, beginning from June 24, 1960.

THANK YOU!!

Documents

CARRIAGE OF GOODS BY THE SEA ACT (COGSA)