*

G.R. No. 136960. December 8, 2003.

IRON BULK SHIPPING PHILIPPINES, CO., LTD., petitioner, vs.

REMINGTON INDUSTRIAL SALES CORPORATION,
respondent.

Actions; Pleadings and Practice; Certiorari; Findings of Fact;

Exceptions; The trial court’s findings of fact are generally binding and
conclusive upon this Court, but there are exceptions to this rule.—The trial
court’s findings of fact, which the Court of Appeals affirmed, are generally
binding and conclusive upon this court. There are recognized exceptions to
this rule, among which are: (1) the conclusion is grounded on speculations,
surmises or conjectures; (2) the inference is manifestly mistaken, absurd or
impossible; (3) there is grave abuse of discretion; (4) the judgment is based
on a misapprehension of facts; (5) the findings of facts are conflicting; (6)
there is no citation of specific evidence on which the factual findings are
based; (7) the finding of absence of facts is contradicted by the presence of
evidence on record; (8) the findings of the CA are contrary to the findings of
the trial court; (9) the CA manifestly overlooked certain relevant and
undisputed facts that, if properly considered, would justify a different
conclusion; (10) the findings of the CA are beyond the issues of the case;
and (11) such findings are contrary to the admissions of both parties.
Petitioner failed to demonstrate that its petition falls under any one of the
above exceptions, except as to damages which will be discussed forthwith.
Civil Law; Contacts; Contract of Carriage; Bill of Lading; Two-fold
Character; A bill of lading operates both as a receipt and as a contract.—It
is settled that a bill of lading has a two-fold character. In Phoenix Assurance
Co., Ltd. vs. United States Lines, we held that: [A] bill of lading operates
both as a receipt and as a contract. It is a receipt for the goods shipped and a
contract to transport and deliver the same as therein stipulated. As a receipt,
it recites the date and place of shipment, describes the goods as to quantity,
weight, dimensions, identification marks and condition, quality and value.
As a contract, it names the contracting parties, which include the consignee,
fixes the route, destination, and freight rate or charges, and stipulates the
rights and obligations assumed by the parties.
Same; Same; Same; Extraordinary Diligence; Extraordinary diligence
in the carriage of goods required of a common carrier.—It is settled that the
extraordinary diligence in the vigilance over the goods tendered

_______________

* SECOND DIVISION.

230
230 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.

Remington Industrial Sales Corporation

for shipment requires the common carrier to know and to follow the
required precaution for avoiding damage to, or destruction of the goods
entrusted to it for safe carriage and delivery. It requires common carriers to
render service with the greatest skill and foresight and to use all reasonable
means to ascertain the nature and characteristic of goods tendered for
shipment, and to exercise due care in the handling and stowage, including
such methods as their nature requires. Under Article 1742 of the Civil Code,
even if the loss, destruction, or deterioration of the goods should be caused,
among others, by the character of the goods, the common carrier must
exercise due diligence to forestall or lessen the loss. This extraordinary
responsibility lasts from the time the goods are unconditionally placed in the
possession of, and received by the carrier for transportation until the same
are delivered, actually or constructively, by the carrier to the consignee, or
to the person who has a right to receive them.

PETITION for review on certiorari of the decision and resolution of

the Court of Appeals.

The facts are stated in the opinion of the Court.

     Soo, Gutierrez, Leogardo, Lee for petitioner.
          P.C. Nolasco & Associates for respondent Remington
Industrial Sales Corporation.

AUSTRIA-MARTINEZ, J.:

Before us is a petition for review on certiorari under Rule 45 of the

1
Rules of Court assailing the August 28, 1998 Decision and the
December 24, 1998
2
Resolution of the Court of Appeals in CA-G.R.
CV No. 49725, affirming in toto the decision of the Regional Trial
Court of Manila (Branch 9).
The factual background of the case is summarized by the
appellate court, thus:

Sometime in the latter part of 1991, plaintiff Remington Industrial Sales

Corporation (hereafter Remington for short) ordered from defendant Wangs
Company, Inc. (hereafter Wangs for short) 194 packages of hot rolled steel
sheets, weighing 686.565 metric tons, with a total value of

_______________

1 Penned by Justice Hector L. Hofileña, concurred in by Justices Minerva P. Gonzaga-Reyes

and Omar U. Amin.
2 Entitled, “Remington Industrial Sales Corporation, Plaintiff, versus Wangs Company
Incorporated, Iron Bulk Shipping Co., Ltd., and Pioneer Asia Insurance Corporation,
Defendants”.

231
 VOL. 417, DECEMBER 8, 2003 231
Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

$219,380.00, then equivalent to P6,469,759.17. Wangs forwarded the order

to its supplier, Burwill (Agencies) Ltd., in Hongkong. On or about
November 26, 1991, the 194 packages were loaded on board the vessel MV
‘Indian Reliance’ at the Port of Gdynia, Poland, for transportation to the
Philippines, under Bill of Lading No. 27 (Exh. ‘C’). The vessel’s
owner/charterer is represented in the Philippines by defendant Iron Bulk
Shipping Phils., Inc. (hereafter Iron Bulk for short).
Remington had the cargo insured for P6,469,759.17 during the voyage
by Marine Insurance Policy No. 7741 issued by defendant Pioneer Asia
Insurance Corporation (hereafter Pioneer for short).
On or about January 3, 1992, the MV ‘Indian Reliance’ arrived in the
Port of Manila, and the 194 packages of hot rolled steel sheets were
discharged from the vessel. The cargo was inspected twice by SGS Far East
Ltd. and found to be wet (with slight trace of salt) and rusty, extending from
50% to 80% of each plate. Plaintiff filed formal claims for loss amounting to
P544,875.17 with Pioneer, Iron Bulk, Manila Port Services, Inc. (MPS) and
ESE Brokerage Corporation (ESE). No one honored such claims.
Thus, plaintiff filed an action for collection, plus attorney’s fees, against
3
Wangs, Pioneer and Iron Bulk. . . .”

and affirmed in toto the following findings of the trial court, on

February 1, 1995, to wit:

...
The evidence on record shows that the direct and immediate cause of the
rusting of the goods imported by the plaintiff was the water found inside the
cargo hold of M/V ‘Indian Reliance’ wherein those goods were stored
during the voyage, particularly the water found on the surface of the
merchandise and on the floor of the vessel hatch. And even at the time the
cargoes were being unloaded by crane at the Pier of Manila, Iron Bulk’s
witnesses noticed that water was dripping from the cargoes. (TSN dated
July 20, 1993, pp. 13-14; TSN dated May 30, 1994, pp. 8-9, 14, 24-25; TSN
dated June 3, 1994, pp. 31-32; TSN dated July 14, 1994, pp. 10-11).
SGS Far Fast Limited, an inspection agency hired by defendant Wangs,
issued Certificate of Inspection and Analysis No. 6401/35071 stating the
following findings:

Results of tests indicated that a very slight trace of salt was present in the sample as
confirmed by the test of Sodium. The results however does not necessarily indicate
that the rusty condition of the material was caused by seawater.

_______________

3 CA Records, pp. 196-197.

232

232 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.

 Remington Industrial Sales Corporation

Tan-Gatue Adjustment Co., Inc., a claims adjustment firm hired by

defendant Pioneer, submitted a Report (Exh. “10-Pioneer”) dated February
20, 1992 to Pioneer which pertinently reads as follows:

All the above 3,971 sheets were heavily rusty at sides/ends/ edges/surfaces. Pieces of
cotton were rubbed by us on different rusty steel sheets and submitted to Precision
Analytical Services, Inc. to determine the cause of wetting. Result thereof as per
Laboratory Report No. 077-92 of this firm showed that: ‘The sample was
wetted/contaminated by fresh water.

After considering the foregoing test results and the other evidence on
record, the Court found no clear and sufficient proof showing that the water
which stayed in the cargo hold of the vessel and which contaminated the
merchandise was seawater. The Court, however, is convinced that the
subject goods were exposed to salt conditions as evidenced by the presence
of about 17% Sodium on the rust sample tested by SGS.
As to the source of the water found in the cargo hold, there is also no
concrete and competent evidence on record establishing that such water
leaked from the pipe installed in Hatch No. 1 of M/V ‘Indian Reliance’, as
claimed by plaintiff. Indeed, the plaintiff based such claim only from
information it allegedly received from its supplier, as stated in its letter to
defendant Iron Bulk dated March 28, 1992 (Exh. “K-3”). And no one took
the witness stand to confirm or establish the alleged leakage.
Nevertheless, since Iron Bulk’s own evidence shows that there was water
inside the cargo hold of the vessel and that the goods stored therein were
wet and full of rust, without sufficient explanation on its part as to when and
how water found its way into the vessel holds, the Court finds and so holds
that Iron Bulk failed to exercise the extraordinary diligence required by law
in the handling and transporting of the goods.
.....
Iron Bulk did not even exercise due diligence because admittedly, water
was dripping from the cargoes at the time they were being discharged from
the vessel. Had Iron Bulk done so, it could have discovered by ordinary
inspection that the cargo holds and the cargoes themselves were affected by
water and it could have provided some remedial measures to prevent or
minimize the damage to the cargoes. But it did not, showing its lack of care
and diligence over the goods.
Besides, since the goods were undoubtedly damaged, and as Iron Bulk
failed to establish by any clear and convincing evidence any of the
exempting causes provided for in Article 1734 of the Civil Code, it is
presumed to have been at fault or to have acted negligently.
....

233

VOL. 417, DECEMBER 8, 2003 233

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

“WHEREFORE, the Court finding preponderance of evidence for the

plaintiff hereby renders judgment in favor of it and against all the
defendants herein as follows:

1. Ordering defendant Pioneer Asia Insurance Corporation to pay

plaintiff the following amounts:

a) P544,875.17 representing the loss allowance for the goods insured,

plus interest at the legal rate (6% p.a.) reckoned from the time of
filing of this case until full payment is made;
b) P50,000.00 for and as attorney’s fees; and
c) the cost of suit.

2. Ordering defendant Iron Bulk Shipping Co., Inc. immediately upon

payment by defendant Pioneer of the foregoing award to the
plaintiff, to reimburse defendant Pioneer the total amount it paid to
the plaintiff, in respect to its right of subrogation.
3. Denying the counterclaims of all the defendants and the cross-claim
of defendant Wangs Company, Incorporated and Iron Bulk
Shipping Co., Inc. for lack of merit.
4. Granting the cross-claim of defendant Pioneer Asia Insurance
Corporation against defendant Iron Bulk by virtue of its right of
subrogation.
5. Dismissing the case against defendant Wangs Company, Inc.
4
SO ORDERED.”
Only Iron Bulk filed the present petition raising the following
Assignment of Errors:

FIRSTLY, the Court of Appeals erred in its insistent reliance on the pro forma Bills
of Lading to establish the condition of the cargo upon loading;
SECONDLY, the Court of Appeals erred in not exculpating petitioner since the
cargo was not contaminated during the time the same was in possession of the
vessel, as evidenced by the express finding of the lower court that the contamination
and rusting was chemically established to have been caused by fresh water;
THIRDLY, the Court of Appeals erred in making a sweeping finding that the
petitioner as carrier failed to exercise the requisite diligence under the law, which is
contrary to what is demonstrated by the evidence adduced; and

_______________

4 Original Records, pp. 440-447.

234

234 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

FINALLY, the Court of Appeals erred in affirming the amount of damages

adjudicated by the Court below, which is at best speculative and not
5
supported by damages.

The general rule is that only questions of law are entertained in

petitions for review by certiorari under Rule 45 of the Rules of
Court. The trial court’s findings of fact, which the Court of Appeals6
affirmed, are generally binding and conclusive upon this court.
There are recognized exceptions to this rule, among which are: (1)
the conclusion is grounded on speculations, surmises or conjectures;
(2) the inference is manifestly mistaken, absurd or impossible; (3)
there is grave abuse of discretion; (4) the judgment is based on a
misapprehension of facts; (5) the findings of facts are conflicting; (6)
there is no citation of specific evidence on which the factual findings
are based; (7) the finding of absence of facts is contradicted by the
presence of evidence on record; (8) the findings of the CA are
contrary to the findings of the trial court; (9) the CA manifestly
overlooked certain relevant and undisputed facts that, if properly
considered, would justify a different conclusion; (10) the findings of
the CA are beyond the issues of the case; and 7(11) such findings are
contrary to the admissions of both parties. Petitioner failed to
demonstrate that its petition falls under any one of the above
exceptions, except as to damages which will be discussed forthwith.
Anent the first assigned error: That the Court of Appeals erred in
relying on the pro forma Bills of Lading to establish the condition of
the cargo upon landing.
There is no merit to petitioner’s contention that the Bill of Lading
covering the subject cargo cannot be relied upon to indicate the
condition of the cargo upon loading. It is settled that a bill of lading
has a two-fold character. In Phoenix Assurance Co., Ltd. vs. United
States Lines, we held that:

[A] bill of lading operates both as a receipt and as a contract. It is a receipt

for the goods shipped and a contract to transport and deliver the same as
therein stipulated. As a receipt, it recites the date and place of shipment,
describes the goods as to quantity, weight, dimensions, identification marks
and condition, quality and value. As a contract, it names the

_______________

5 Rollo, pp. 9-10.

6 Ermac vs. Ermac, G.R. No. 149679, May 30, 2003, 403 SCRA 291.
7 Larena vs. Mapili, G.R. No. 146341, August 7, 2003, 408 SCRA 484.

235

VOL. 417, DECEMBER 8, 2003 235

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

contracting parties, which include the consignee, fixes the route, destination,
and freight rate or charges, and stipulates the rights and obligations assumed
8
by the parties.

We find no error in the findings of the appellate court that the

questioned bill of lading is a clean bill of lading, i.e., it does not
indicate any defect in the goods covered
9
by it, as shown by the
notation, “CLEAN ON BOARD” and “Shipped at the Port of
Loading in apparent good10
condition on board the vessel for carriage
to Port of Discharge.”
Petitioner presented evidence to prove that, contrary to the
recitals contained in the subject bill of lading, the cargo therein
described as clean on board is actually wet and covered with rust.
Indeed, having the nature of a receipt, or an acknowledgement of the
quantity and condition of the goods delivered, the bill of lading, like11
any other receipts, may be explained, varied or even contradicted.
However, we agree with the Court of Appeals that far from
contradicting the recitals contained in the said bill, petitioner’s own
evidence shows that the cargo covered by the subject bill of lading,
although it was partially wet and covered with rust was,
nevertheless, found to be in a “fair, 12
usually accepted condition”
when it was accepted for shipment.
The fact that the issued bill of lading is pro forma is of no
moment. If the bill of lading is not truly reflective of the true
condition of the cargo at the time of loading to the effect that the
said cargo was indeed in a damaged state, the carrier could have
refused to accept it, or at the least, made a marginal note in the bill
of lading indicating the true condition of the merchandise. But it did
not. On the contrary, it accepted the subject cargo and even agreed to
the issuance of a clean bill of lading without taking any exceptions
with respect to the recitals contained therein. Since the carrier failed
to annotate in the bill of lading the alleged damaged condition of the
cargo when it was loaded, said carrier and the petitioner, as its
representative, are bound by the description appear-

_______________

8 22 SCRA 674, 678 (1968).

9 Exhibit “1-A”, OR, p. 307.
10 Exhibit “1-B”, OR, p. 307.
11 Commentaries and Jurisprudence on the Commercial Laws of the Philippines,
Agbayani, 1983 Edition, p. 119.
12 Exhibit “7-E-Iron Bulk”, OR, pp. 700-706.

236

236 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

ing therein and they are now estopped from denying the contents of
the said bill. 13
Petitioner presented
14
in evidence the Mate’s Receipts and a
Survey Report to prove the damaged condition of the cargo.
However, contrary to the asseveration of petitioner, the Mate’s
Receipts and the Survey Report which were both dated November 6,
1991, are unreliable evidence of the true condition of the shipment at
the time of loading since said receipts and report were issued twenty
days prior to loading and before the issuance of the clean bill of
lading covering the subject cargo on November 26, 1991. Moreover,
while the surveyor, commissioned by the carrier to inspect the
subject cargo, found the inspected steel goods to be contaminated
with rust he, nonetheless, estimated the merchandise to be in a fair
and usually accepted condition.
Anent the second and third assigned errors: That the Court of
Appeals erred in not finding that the contamination and rusting was
chemically to have been caused by fresh water; and that the
appellate court erred in finding that petitioner failed to exercise the
requisite diligence under the law.
Petitioner’s arguments in support of the assigned errors are not
plausible. Even granting, for the sake of argument, that the subject
cargo was already in a damaged condition at the time it was
accepted for transportation, the carrier is not relieved from its
responsibility to exercise due care in handling the merchandise and
in employing the necessary precautions to prevent the cargo from
further deteriorating. It is settled that the extraordinary diligence in
the vigilance over the goods tendered for shipment requires the
common carrier to know and to follow the required precaution for
avoiding damage to, or destruction
15
of the goods entrusted to it for
safe carriage and delivery. It requires common carriers to render
service with the greatest skill and foresight and to use all reasonable
means to ascertain the nature and characteristic of goods tendered
for shipment, and to exercise due care in the handling and stowage,
16
including such methods as their nature requires.

_______________

13 Exhibits “5-A” to “5-V-Iron Bulk”, OR, pp. 666-687.

14 Exhibit “7-E-Iron Bulk”, supra.
15 Compania Maritima vs. Court of Appeals, 164 SCRA 685, 691-692 (1988).
16 Ibid.

237

VOL. 417, DECEMBER 8, 2003 237

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

Under Article 1742 of the Civil Code, even if the loss, destruction,
or deterioration of the goods should be caused, among others, by the
character of the goods, the common carrier must exercise due
diligence to forestall or lessen the loss. This extraordinary
responsibility lasts from the time the goods are unconditionally
placed in the possession of, and received by the carrier for
transportation until the same are delivered, actually or
constructively, by the carrier
17
to the consignee, or to the person who
has a right to receive them. In the instant case, if the carrier indeed
found the steel sheets to have been covered by rust at the time that it
accepted the same for transportation, such finding should have
prompted it to apply additional safety measures to make sure that the
cargo is protected from corrosion. This, the carrier failed to do.
Article 1734 of the Civil Code states that:
Common carriers are responsible for the loss, destruction or deterioration of
the goods, unless the same is due to any of the following causes only:

(1) Flood, storm, earthquake, lightning, or other natural disaster or

calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character of the goods or defects in the packing or in the
containers;
(5) Order or act of competent public authority.

Except in the cases mentioned under Article 1734, if the goods are
lost, destroyed or deteriorated, common carriers are presumed to
have been at fault or to have acted negligently, unless they prove that 18
they observed extraordinary diligence as required under the law.
The Court of Appeals did not err in finding that no competent
evidence was presented to prove that the deterioration of the subject
cargo was brought about by any of the causes enumerated under the
aforequoted Article 1734 of the said Code. We likewise agree with
appellate court’s finding that the carrier failed to present proof that it
exercised extraordinary diligence in its vigilance over the goods.
The presumption that the carrier was at fault or

_______________

17 Article 1736, Civil Code.

18 Article 1735, Civil Code.

238

238 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

that it acted negligently was not overcome by any countervailing

evidence.
Anent the last assigned error: That the Court of Appeals erred in
affirming the amount of damages awarded by the trial court.
We agree with the contention of the petitioner in its last assigned
error that the amount of damages adjudicated by the trial court and
affirmed by the appellate court is not in consonance with the
evidence presented by the parties. The judgments of both lower
courts are based on misapprehension of facts as we find no
competent evidence to prove the actual damages sustained by
respondent.
Based on the Packing List issued by Burwill (Agencies) Limited,
the supplier of the steel sheets, the cargo consigned to Remington
consisted of hot rolled steel sheets with lengths of eight feet and
twenty feet. The eight-foot length steel sheets contained in 142
packages had a weight of 491.54 metric tons while the twenty-foot
steel sheets 19which were contained in 52 packages weighed 194.25 20
metric tons. The goods were valued at $320.00 per metric ton.
 It is not disputed that at the time of inspection of the subject
merchandise conducted by SGS Far East Limited on January 21-24,
1992 and January 27-28, 1992, only 30% of said goods originally
consigned to Remington was available for examination at
Remington’s warehouse in Manila and that Remington had already
disposed of the remaining 70%. In the Certificate of Inspection
issued by SGS, dated February 18, 1992, it was reported that the
surface of the steel sheets with length of twenty feet
21
were found to
be rusty “extending from 60% to 80% per plate.” However, there
was no proof to show how many metric tons of twenty-foot and
eight-foot length steel sheets, respectively, comprise the remaining
30% of the cargo. No competent evidence was presented to prove
the weight of the remaining twenty-foot length steel sheets, on the
basis of which the amount of actual damages could have been
ascertained.
Remington claims that 70% of the twenty-foot length steel sheets
were damaged. Remington’s general manager, Rowina Tan Saban,
testified that the “70%” figure was based on the reports

_______________

19 Exhibit “D”/”2-Wangs”, OR, p. 518.

20 Ibid.
21 Exhibit “I-1”, OR, p. 531.

239

VOL. 417, DECEMBER 8, 2003 239

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

submitted by SGS and Tan-Gatue and Remington’s independent

22
survey to confirm these reports. Saban further testified that on the
basis of these reports, Remington came up with a summary of the
amount of damages sustained by the subject cargo, to wit:

Plates 8 ft lengths 491.540 MT US$157,292.80

Quantity Damaged   25%
Loss Allowance   13%
Total Plates 8 ft lengths   US$15,211.56
Plates 20 ft lengths 194.025 MT US$62,088.00
Quantity Damaged   70%
Loss Allowance   35%
Total Plates 20 ft   P544,875.71
lengths
with the following detailed computation:
Plates under 8 ft lengths 491.540 MT @ $320./MT
    US $157,292.80
Multiply by 25% Qty. damaged $ 39,323.20
     13% Loss allowance $ 5,112.02
Plates under 20 ft. lengths 194.025 MT @ $320./MT
    US $ 62,088.00
Multiple 70% Qty. damaged US $ 43,461.60
35% Loss allowance   $ 15,211.56
Total claim US $ 5,112.02  
  $15,211.56  
       US $20,323.58 @ $26.81 =
P544,875.17

and which the trial court based the actual damages awarded in favor
of Remington.
However, after a careful examination of the reports submitted by
SGS and Tan-Gatue, we find nothing in the said reports and
computation to justify the claim of Remington that 70% of the
twenty-foot length steel sheets were damaged. Neither does the
alleged survey conducted by Remington consisting only of
23
photographs, prove the quantity of the damaged cargo.
As to the eight-foot length steel sheets, SGS reported that they
were found oiled all over which makes it hard to determine the

_______________

22 TSN, July 20, 1993, pp. 7-17.

23 Exhibits “MTC” to “MTC-7”, OR, pp. 547-549.

240

240 SUPREME COURT REPORTS ANNOTATED

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

24
rust condition on its surface. On the other hand, the report issued
by Tan-Gatue did not specify the extent of damage done to the said
25
merchandise. There is also no proof of the weight of the remaining
eight-foot length steel sheets. From the foregoing, it is evident that
the extent of actual damage to the subject cargo is likewise not
satisfactorily proven.
It is settled that actual or compensatory damages are not
presumed and should be proven
26
before they are awarded. In Spouses
Quisumbing vs. Meralco, we held that

Actual damages are compensation for an injury that will put the injured
party in the position where it was before it was injured. They pertain to such
injuries or losses that are actually sustained and susceptible of measurement.
Except as provided by law or stipulation, a party is entitled to an adequate
compensation only for such pecuniary loss as it has duly proven.

Hence, for failure of Remington to present sufficient evidence which

is susceptible of measurement, it is not entitled to actual damages.
 Nonetheless, since it was established that the subject steel sheets
sustained damage by reason of the negligence of the carrier, albeit
no competent proof was presented to justify the award of actual
damages, we find that Remington is entitled to temperate damages in
accordance with Articles 2216, 2224 and 2225 of the Civil Code, to
wit:

Art. 2216. No proof of pecuniary loss is necessary in order that moral,

nominal, temperate, liquidated or exemplary damages may be adjudicated.
The assessment of such damages, except liquidated ones, is left to the
discretion of the court, according to the circumstances of each case.
Art. 2224. Temperate or moderate damages, which are more than
nominal but less than compensatory damages, may be recovered when the
court finds that some pecuniary loss has been suffered but its amount
cannot, from the nature of the case, be proved with certainty.
Art. 2225. Temperate damages must be reasonable under the
circumstances.

_______________

24 Exhibit “I-1” supra.

25 Exhibit “R”, “10-Pioneer”, OR, pp. 627-629.
26 G.R. No. 142943, April 3, 2002, 380 SCRA 195.

241

VOL. 417, DECEMBER 8, 2003 241

Iron Bulk Shipping Philippines, Co., Ltd. vs.
Remington Industrial Sales Corporation

Thirty percent of the alleged cost of damages, i.e., P544,875.17

orP165,000.00 is reasonable enough for temperate damages.
We likewise agree with petitioner’s claim that it should not be
held liable for the payment of attorney’s fees because it was always
willing to settle its liability by offering to pay 30% of Remington’s
claim and that it is only Remington’s unwarranted refusal to accept
such offer that led to the filing of the instant case. As found earlier,
there is no evidence that the 70% of the 20-foot length steel sheets
which had been disposed of had been damaged. Neither is there
competent evidence proving the actual extent of damage sustained
by the eight-foot length steel sheets. Petitioner was therefore
justified in refusing to satisfy the full amount of Remington’s claims.
WHEREFORE, the assailed Decision of the Court of Appeals
dated August 28, 1998 and the Resolution dated December 24, 1998,
in CA-G.R. CV No. 49725 are MODIFIED as follows: The award of
actual damages and attorney’s fees are deleted. Respondent is
awarded temperate damages in the amount of P165,000.00. In all
other respects, the appealed decision and resolution are affirmed.
No pronouncement as to costs.
SO ORDERED.

     Puno (Chairman), Quisumbing, Callejo, Sr. and Tinga, JJ.,

concur.
 Judgment and resolution modified.

Note.—A man must use common sense, and exercise due

reflection in all his acts—it is his duty to be cautious, careful, and
prudent, if not from instinct, then through fear of incurring
punishment. (People vs. Delos Santos, 355 SCRA 415 [2001])

——o0o——

242

242 SUPREME COURT REPORTS ANNOTATED

Dela Chica vs. Sandiganbayan

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