Roque v.

Intermediate Appellate Court

G.R. No. L-66935 Nov. 11, 1985

Justice Gutierrez, Jr.

Facts: Isabela Roque (Roque of Isabela Roque Timber Enterprises) hired the Manila
Bay Lighterage Corp. (Manila Bay) to load and carry its logs from Palawan to North
Harbor, Manila. The logs were insured with Pioneer Insurance and Surety Corp.
(Pioneer). The logs never reached Manila due to certain circumstances (as alleged
by Roque and found by the appellate court), such as the fact that the barge was not
seaworthy that it developed a leak, that one of the hatches were left open causing
water to enter, and the absence of the necessary cover of tarpaulin causing more
water to enter the barge. When Roque demanded payment from Pioneer, but the
latter refused on the ground that its liability depended upon the Total Loss by Total
Loss of Vessel Only. The trial court ruled in favor of Roque in the civil complaint
filed by the latter against Pioneer, but the decision was reversed by the appellate
court.

Issue: W/N in cases of marine insurance, there is a warranty of seaworthiness by

the cargo owner; WON the loss of the cargo was due to perils of the sea, not perils
of the ship

Held: Yes, there is. The liability of the insurance company is governed by law.
Section 113 of the Insurance Code provides that In every marine insurance upon a
ship or freight, or freightage, or upon anything which is the subject of marine
insurance, a warranty is implied that the ship is seaworthy. Hence, there can be no
mistaking the fact that the term "cargo" can be the subject of marine insurance and
that once it is so made, the implied warranty of seaworthiness immediately
attaches to whoever is insuring the cargo whether he be the shipowner or not.
Moreover, the fact that the unseaworthiness of the ship was unknown to the insured
is immaterial in ordinary marine insurance and may not be used by him as a
defense in order to recover on the marine insurance policy.