Commercial Law

A. Magsaysay, Inc. vs Anastacio Agan

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G.R. No. L-6393 – 96 Phil. 504 – Mercantile Law – Transportation - General Averages - Stranding of a Vessel

In 1949, SS San Antonio, owned by A. Magsaysay, Inc. (AMInc), embarked on its voyage to Batanes via Aparri. It was carrying various cargoes, one of which was owned by Anastacio Agan. One fine weather day, it accidentally ran aground the mouth of the Cagayan River due to the sudden shifting of the sands below. SS San Antonio then needed the services of Luzon Stevedoring Co. to tow the ship and make it afloat so that it can continue its journey. Later, AMInc required the cargo owners to pay the expenses incurred in making the ship afloat (P841.40 each). The expenses, AMInc claims, fall under the General Averages Rule under the Code of Commerce, which is to be shared by ship owner and cargo owners as well.

ISSUE: Whether or not general averages exist in the case at bar.

HELD: No. General averages contemplate that the stranding of the vessel is intentionally done in order to save the vessel itself from a certain and imminent danger. Here, the stranding was accidental and it was made afloat for the purpose of saving the voyage and not the vessel. Note that this happened on a fine weather day. Also, it cannot be said that the towing was made to save the cargos, for the cargos were not in danger imminent danger.

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