Facts: General Milling Corporation (GMC) contracted Wallem Philippines

Shipping Inc. (WALLEM) to ship Indian Toasted Soyabean Extraction Meal to

its warehouse in Pasig. During the weighing of the cargo in Batangas, and
after comparing its supposed weight from that indicated in the bill of lading,
it was found that there was a shortage of 295.682 M/Tons in the shipment.
The said bill of lading was prepared by GMC.
Prudential Guarantee & Assurance Inc (PRUDENTIAL), being GMCs insurer,
received a claim from the latter because of the shortage in the shipment.
Prudential paid GMC P995, 677.09, and the latter issued a subrogation
receipt to PRUDENTIAL. PRUDENTIAL thereafter sent a demand letter to
WALLEM to recover the amount paid to GMC. WALLEM denied liability for the
loss in the shipment.
PRUDENTIAL brought an action for damages against WALLEM and Seacoast
Maritime Corp. with the RTC of Makati City. The trial court ruled that
PRUDENTIAL failed to prove that there was shortage in the shipment. Since
PRUDENTIAL failed to establish that the bill of lading was duly executed, the
true and exact weight of the shipment when it was loaded unto the vessel
cannot be determined. Hence, there was no way by which a shortage could
be determined. Also, since PRUDENTIAL failed to present the contract of
insurance executed between it and GMC, it had no cause of action against
WALLEM.
On appeal, the CA reversed.
Issue: Whether or not PRUDENTIAL became subrogated to the rights of GMC
to claim indemnity against WALLEM
Held: No, PRUDENTIAL did not become subrogated to GMCs rights.