Bill of lading

A bill of lading is a written acknowledgment of the receipt of goods and an agreement to transport
and to deliver them at a specified place to a person named therein or on his order.

Three-fold characteristics:
1. Receipt for the goods
2. Evidence of terms of contract of carriage
3. Document of title

Nemo dat quod non habet

 You cannot give what you do not have.

Unsworth Transport International v. Court of Appeals

 The bill of lading did not declare a higher value, maximum liability is limited.
 Package liability rule will apply.
 If the carrier provided no explanation, the common carrier is liable.
 Shipper may declare a higher value.
 As a receipt, the BOL represents all the goods covered by the common carrier but also its
value not only the quality or quantity. Hence, shipper is bound by the BOL.
 Civil Code does not limit the liability of the common carrier in its package.
 It is the Code of Commerce and special laws in the absence of declaring the higher value.

Keng Hua Paper Products Co. v. Court of Appeals

 Liable for demurrage due to prolonged failure of accepting the shipment.

 Acceptance of the BOL gives rise to the presumption that consignee has full knowledge of its
contents.

Parties to a bill of lading:

1. Shipper
2. Carrier
3. Consignee

Other parties

 Third parties may also be affected.

 Signatories are only the shipper and carrier.
  Consignee may be bound if he accepts the BOL.

Everett Steamship v. Court of Appeals

 Limitation of value is valid based on Art. 1749 and 1750.

Art. 1749
A stipulation that the common carrier’s liability is limited to the value of the goods appearing in the
bill of lading, unless the shipper or owner declares a greater value, is binding.

Art. 1750
A contract fixing the sum that may be recovered by the owner or shipper for the loss, destruction,
or deterioration of the goods is valid, if it is reasonable and just under the circumstances, and has
been fairly and freely agreed upon.

Consignee is bound
1. Relationship of agency
2. Consignee demands fulfillment of the bill of lading.

Kinds of bill of lading:

1. On-board bill of lading: issued when the goods have been actually placed aboard the ship
with every reasonable expectation that the shipment is as good as on its way.
2. Received for shipment bill of lading: states that the goods have been received for shipment
with or without specifying the vessel by which the goods are to be shipped.

Magellan Manufacturing Marketing Corp. v. Court of Appeals

 Acceptance of the BOL without dissent raises the presumption that all the terms therein
were brought to the knowledge of the shipper and agreed to by him and, in the absence of
fraud or mistake, he is estopped thereafter denying that he assented to such terms.

Period for delivery

 If the shipper should change the consignee of the goods without changing their destination,
the carrier shall comply with the new order provided that shipper returns to the carrier the
BOL and a new one is issued.
Delivery without surrender of BOL

 Common carrier may still be held liable despite the non-issuance of a BOL.
 There is a complete and consummated contract of carriage once the cargo is delivered to
the carrier and the latter takes possession thereof.
 The deliver of a BOL is not a requisite for the perfection of the contract of carriage. As such,
the common carrier is liable despite non-issuance of BOL.
 GR: Upon receipt of the goods, the consignee surrenders the BOL to the carrier and their
respective obligations are considered cancelled.
 XPNs: (1) BOL gets lost; or (2) for other cases.
 In either case, the consignee must issue a receipt to the carrier upon the release of the
goods. Such receipt shall produce the same effect as the surrender of the BOL.

Refusal of consignee to take delivery

 In case the damaged portion of the goods can be segregated from those delivered in good
condition, the consignee may reject those in damaged condition and accept merely those
which are in good condition.
 If the effect of damage on the goods consisted merely of diminution in value, the carrier is
bound to pay only the difference between its price on that day and its depreciated value as
provided under Art. 364, Code of Commerce.
 If the goods are rendered useless for sale, consumption, or for the intended purpose, the
consignee may reject the goods and demand payment of such goods at their market price on
that day pursuant to Art. 365, Code of Commerce.

Period for filing claims in case of damage to goods

a) Carriage of goods within the Philippines
 Damage is apparent – filed immediately with the common carrier.
 Damage is not apparent – notice must be filed within 24 hours from delivery.

b) Carriage of goods from foreign ports to the Philippines

 Damage is apparent – noticed must be filed upon discharge of goods.
 Damage is not apparent – notice must be given to the common carrier within 3 days from
delivery.
Commencement of 24-hour period

 The 24-hour period within which claims must be presented does not begin to run until the
consignee has received such possession of the merchandise that he may exercise over it the
ordinary control pertinent to ownership.
 The giving of notice of loss or injury is a condition precedent to the action for loss or injury
or the right to enforce the carrier’s liability.
  The purpose is not to relieve the carrier from just liability, but reasonably inform it that the
shipment has been damaged and that it is charged with liability therefor, and to give it an
opportunity to examine the nature and extent of the injury.
 This protects the carrier by affording it an opportunity to make an investigation of a claim
while the matter is fresh and easily investigated so as to safeguard itself from false and
fraudulent claims.

Philippine American General Insurance Co. v. Sweet Lines

 Notice is a condition precedent and the carrier is not liable if notice is not given in
accordance with the stipulation, as the failure to comply with such a stipulation in a
contract of carriage with respect to notice of loss or claim for damage bars recovery for the
loss or damage suffered.

UCPB v. Aboitiz Shipping Corp.

 Without such prior notice or claim having been made within the time allowed, no right of
action against the carrier can rise in favor of the shipper or consignee.

Aboitiz Shipping Corp. v. ICNA

 Provisions specifying a time to give notice of damage to common carriers are ordinarily to
be given a reasonable and practical, rather than a strict construction.

Prescriptive period for filing action

a) Within Philippines (coastwise)
 Within 6 months from delivery of the goods if no BOL was issued.
 If BOL was issued, 10 years from the receipt of goods.

b) Foreign ports to PH ports

 Within 1 year from date of delivery (damaged goods) or the date the goods should have
been delivered.

Reduction of 1 year not allowed

 A stipulation reducing the 1-year period for filing the action for recovery on lost or
damaged cargo is null and void.