ASIAN TERMINALS, INC., vs. FIRST LEPANTO-TAISHO INSURANCE CORPORATION G.R. No.

185964, 16
June 2014

FACTS:

A shipment of 3,000 bags of sodium tripolyphosphate arrived in Manila through COSCO and was dischag
ed into the possession and custody of ATI, a domestic corporation engaged in arrastre business. The ship
ment remained for quite some time at ATIs storage area until it was withdrawn by broker, PROVEN, on f
or delivery to the consignee. Upon receipt of the shipment, it was found out that the delivered goods inc
urred shortages and spillage for a loss/damage valued at P166,772.41. GASI sought recompense from C
OSCO, thru its Philippine agent SMITH BELL, ATI and PROVEN but was denied.

Hence, it pursued indemnification from the shipments insurer, FIRST LEPANTO. As subrogee, FIRST LEPA
NTO demanded from COSCO, its shipping agency in the Philippines, SMITH BELL, PROVEN and ATI, reimb
ursement of the amount it paid to GASI. ATI and PROVEN denied liability for the lost/damaged shipment
and claimed that it exercised due diligence and care in handling the same.

ISSUE:

Whether or not the non-

presentation of an insurance contract will bar a subrogee from collecting reimbursement.

HELD:

No, Non-
presentation of the insurance contract is not fatal to FIRST LEPANTOs cause of action for reimbursemen
t as subrogee. Subrogation is the substitution of one person in the place of another with reference to a l
awful claim or right, so that he who is substituted succeeds to the rights of the other in relation to a deb
t or claim, including its remedies or securities.

In the case at bar, the Supreme Court observed that it is conspicuous from the records that ATI put in iss
ue the submission of the insurance contract for the first time before the CA. Despite opportunity to stud
y FIRST LEPANTOs complaint before the MeTC, ATI failed to allege in its answer the necessity of the insu
rance contract. Neither was the same considered during pre-
trial as one of the decisive matters in the case.

Further, ATI never challenged the relevancy or materiality of the Certificate of Insurance presented by FI
RST LEPANTO as evidence during trial as proof of its right to be subrogated in the consignees stead. Sinc
e it was not agreed during the pre-
trial proceedings that FIRST LEPANTO will have to prove its subrogation rights by presenting a copy of th
e insurance contract, ATI is barred from pleading the absence of such contract in its appeal. It is imperati
ve for the parties to disclose during pre-
trial all issues they intend to raise during the trial because, they are bound by the delimitation of such iss
ues. The determination of issues during the pre-
trial conference bars the consideration of other questions, whether during trial or on appeal.