60-oriental assurance corp. vs. court of appeals, 200 scra 459 (1991)

7/17/2019 60-Oriental Assurance Corp. vs. Court of Appeals, 200 SCRA 459 (1991)

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Oriental Assurance Corp. v. CA G.R. No. 94052 1of

Republic of the Philippines

SUPREME COURT

Manila

SECOND DIVISION

G.R. No. 94052 August 9, 1991

ORIENTAL ASSURANCE CORPORATION,petitioner,

vs.

COURT OF APPEALS AND PANAMA SAW MILL CO., INC ., respondents.

Alejandro P. Ruiz, Jr. for petitioner.

Federico R. Reyes for private respondent.

MELENCIO!ERRERA,J:

n action to recover on a !arine insurance polic", issued b" petitioner in favor of private respondent, arisin# fro!

the loss of a ship!ent of apiton# lo#s fro! Pala$an to Manila.

%he facts relevant to the present revie$ disclose that so!eti!e in &anuar" '()*, private respondent Pana!

Sa$!ill Co., Inc. +Pana!a bou#ht, in Pala$an, ',-) pieces of apiton# lo#s, $ith a total volu!e of -, cub

!eters. It hired %ranspacific %o$a#e, Inc., to transport the lo#s b" sea to Manila and insured it a#ainst loss for P

M $ith petitioner Oriental ssurance Corporation +Oriental ssurance. %here is a clai! b" Pana!a, ho$ever, th

the insurance covera#e should have been for P0/M $ere it not for the fraudulent act of one 1enito S" 2ee 3on# t

$ho! it had entrusted the a!ount of P*,. for the pa"!ent of the pre!iu! for a P0/M polic".

Oriental ssurance issued Marine Insurance Polic" No. OCM )*4-, $hich stipulated, a!on# others5

Na!e of Insured5 Pana!a Sa$!ill, Inc.6aruhatan, Valen7uela, Metro Manila

Vessel5

M%. 8Se!inole8 1ar#e PC% 9,/', cubic !eter apiton# 3o#s 1ar#e %ranspac ',/', cub

!eter apiton# 3o#s Vo"a#e or Period of Insurance5

:ro! Pala$an/E%D &anuar" '*, '()* %o5 Manila

Sub;ect !atter Insured5

-, cubic !eters apiton# 3o#s #reed Value

!ount Insured . rate = .->?

Doc. sta!ps ')9.* Invoice No. '>9)*-

l ? P4ta@ ->.


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%O%3 P-,9'-.>

C3ASES, ENDORSEMEN%S, SPECI3 CONDI%IONS and BRRN%IES

Barranted that this Insurance is a#ainst %O%3 3OSS ON32. Sub;ect to the follo$in# clauses5

= Civil Code rticle '-> Baiver clause

= %"phoon $arrant" clause

= O!nibus clause.

%he lo#s $ere loaded on t$o +- bar#es5 +' on bar#e PC%/9,*' pieces of lo#s $ith a volu!e of ',

cubic!eters and +- on 1ar#e %PC/', >() pieces of lo#s, also $ith a volu!e of ', cubic !eters.

On -) &anuar" '()*, the t$o bar#es $ere to$ed b" one tu#/boat, the M% 8Se!inole8 1ut, as fate $ould have i

durin# the vo"a#e, rou#h seas and stron# $inds caused da!a#e to 1ar#e %PC/' resultin# in the loss of (

pieces of lo#s out of the >() pieces loaded thereon.

Pana!a de!anded pa"!ent for the loss but Oriental ssurance refuse on the #round that its contracted liabili$as for %O%3 3OSS ON32. %he re;ection $as upon the reco!!endation of the %an Fatue d;ust!en

Co!pan".

Anable to convince Oriental ssurance to pa" its clai!, Pana!a filed a Co!plaint for Da!a#es a#ainst Eve

Insurance #enc" +alle#edl", also liable, 1enito S" 3ee 2on# and Oriental ssurance, before the Re#ional %ri

Court, 6alooGan, 1ranch '-0, docGeted as Civil Case No. C/'-*'.

fter trial on the !erit, the R%C rendered its Decision, $ith the follo$in# dispositive portion5

B


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and pra"s that the a$ard to Ever Insurance #enc" or ntonio S" 3ee 2on# of da!a#es and attorne"8s fees be se

aside.

%he Huestion for deter!ination is $hether or not Oriental ssurance can be held liable under its !arine insuranc

polic" based on the theor" of a divisible contract of insurance and, conseHuentl", a constructive total loss.

Our considered opinion is that no liabilit" attaches.

%he ter!s of the contract constitute the !easure of the insurer liabilit" and co!pliance there$ith is a conditio

precedent to the insured8s ri#ht to recover" fro! the insurer +Perla Co!pania de Se#uros, Inc. v. Court of ppeal

F.R. No. 9))*, Ma" -), '((, ')> SCR 9'. Bhether a contract is entire or severable is a Huestion of intentio

to be deter!ined b" the lan#ua#e e!plo"ed b" the parties. %he polic" in Huestion sho$s that the sub;ect !atte

insured $as the entire ship!ent of -, cubic !eters of apiton# lo#s. %he fact that the lo#s $ere loaded on t$

different bar#es did not !aGe the contract several and divisible as to the ite!s insured. %he lo#s on the t$o bar#

$ere not separatel" valued or separatel" insured. Onl" one pre!iu! $as paid for the entire ship!ent, !aGin# fo

onl" one cause or consideration. %he insurance contract !ust, therefore, be considered indivisible.

More i!portantl", the insurer8s liabilit" $as for total loss onl". total loss !a" be either actual or constructiv+Sec. '-(, Insurance Code. n actual total loss is caused b"5

+a total destruction of the thin# insured

+b %he irretrievable loss of the thin# b" sinGin#, or b" bein# broGen up

+c n" da!a#e to the thin# $hich renders it valueless to the o$ner for the purpose for $hich h

held it or

+d n" other event $hich effectivel" deprives the o$ner of the possession, at the port

destination, of the thin# insured. +Section '0, Insurance Code.

constructive total loss is one $hich #ives to a person insured a ri#ht to abandon, under Section '0( of th

Insurance Code. %his provision reads5

SEC%ION '0(. person insured b" a contract of !arine insurance !a" abandon the thin# insure

or an" particular portion thereofseparately valued by the policy, or otherwise separately insure

and recover for a total loss thereof, $hen the cause of the loss is a peril in;ured a#ainst,

+a If !ore than three/fourths thereof in value is actuall" lost, or $ould have to be e@pended

recover it fro! the peril

+b If it is in;ured to such an e@tent as to reduce its value !ore than three/fourths

@@@ @@@ @@@

+E!phasis supplied

Respondent ppellate Court treated the loss as a constructive total loss, and for the purpose of co!putin# the !or

than three/fourths value of the lo#s actuall" lost, considered the car#o in one bar#e as separate fro! the lo#s in th

other. %hus, it concluded that the loss of (9 pieces of lo#s fro! bar#e %PC/', !athe!aticall" speaGin#, i

!ore than three/fourths + of the >() pieces of lo#s loaded in that bar#e and !a", therefore, be considered a

constructive total loss.


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%he basis thus used is, in our opinion, reversible error. %he reHuire!ents for the application of Section '0( of th

Insurance Code, Huoted above, have not been !et. %he lo#s involved, althou#h placed in t$o bar#es, $ere n

separatel" valued b" the polic", nor separatel" insured. Resultantl", the lo#s lost in bar#e %PC/' in relation

the total nu!ber of lo#s loaded on the sa!e bar#e can not be !ade the basis for deter!inin# constructive total los

%he lo#s havin# been insured as one inseparable unit, the correct basis for deter!inin# the e@istence

constructive total loss is the totalit" of the ship!ent of lo#s. Of the entiret" of ',-), pieces of lo#s, onl" (pieces thereof $ere lost or '.>? of the entire ship!ent. Since the cost of those (9 pieces does not e@ceed 9>

of the value of all ',-) pieces of lo#s, the ship!ent can not be said to have sustained a constructive total los

under Section '0(+a of the Insurance Code.

In the absence of either actual or constructive total loss, there can be no recover" b" the insured Pana!a a#ainst th

insurer, Oriental ssurance.

1" reason of the conclusions arrived at, Pana!a8s asseverations in its Co!!ent need no lon#er be passed upon

besides the fact that no revie$, in proper for!, has been sou#ht b" it.

W!EREFORE, the ;ud#!ent under revie$ is hereb" SET ASIDE and petitioner, Oriental ssuranCorporation, is hereb" A"SOL#ED fro! liabilit" under its !arine insurance polic" No. OC/M/)*4-. N

costs.

SO ORDERED.

Paras, Padilla, Sariento and Re!alado, JJ., concur.

60-oriental assurance corp. vs. court of appeals, 200 scra 459 (1991)

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