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[ G.R. No. 135712. January 25, 1999]

SULPICIO LINES, INC. v. ALEJANDRINO MORON, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JAN 25, 1999.

G.R. No. 135712 (Sulpicio Lines, Inc. v. Alejandrino Moron, et al.)

Herein respondents, 34 in all, were passengers of the M/V Do�a Marilyn, owned by petitioner Sulpicio Lines, Inc., which sank on October 24, 1988 while enroute from Manila to Tacloban, Leyte. They filed a complaint for damages against petitioner for loss of personal effects, including cash amounts, and for physical injuries resulting from the sea mishap.

After trial, the Regional Trial Court of Palo, Leyte, where the case was filed, rendered judgment ordering petitioner to pay each of the respondents P50,000.00 moral damages and P150,000.001 [This appears to be a typographical error.] exemplary damages as well as the total amount of P592,422.55 as actual damages; P48,000.00 medical expenses; P64,000.00 litigation expenses; P780,880.00 attorney's fees; and costs.

On appeal, the Court of Appeals modified the trial court's decision by reducing the award of exemplary damages to P50,000.00 for each respondent and deleting the award of attorney's fees. Petitioner moved for a reconsideration, but its motion was denied. Hence this petition.

The Court finds the petition to be without merit.

First. Petitioner contends that it cannot be held liable for the loss of respondents' cash and baggage because the latter did not declare the value of the same before boarding the ship. This is an issue, however, which cannot be raised in this Court for the first time in this appeal. It does not appear that petitioner raised it in the Court of Appeals.

Second. Petitioner contends that it cannot be held liable for moral and exemplary damages as private respondents survived the mishap and it was not guilty of fraud or bad faith. This contention is also without merit. In cases involving contracts of carriage, an award of moral damages is justified in the event of the death of the passenger or where the common carrier is guilty of fraud or bad faith.2[Singson v. Court of Appeals, 282 SCRA 149 (1997).] In the latter case that the passenger did not die in the accident is immaterial for the purpose of making the common carrier liable for moral damages. Petitioner's gross negligence, amounting to bad faith, was already declared by this Court in Sulpicio Lines, Inc. v. Court of Appeals3 [246 SCRA 376 (1995).] in which it was held:

In the same manner, (referring to the negligence of the crew of the ship that sank in Vasquez v. Court of Appeals, 138 SCRA 553 (1985)) the crew of the vessel M/V Do�a Marilyn took a calculated risk when it proceeded despite the typhoon brewing somewhere in the general direction to which the vesssel was going. The crew assumed a greater risk, instead of dropping anchor in or at the periphery of the Port of Calapan, or returning to the port of Manila which is nearer, proceeded on its voyage on the assumption that it will be able to beat and race with the typhoon and reach its destination before it (Unsang) passes.4[Id., p. 383.]

Following the principle of stare decisis, the finding in that case is conclusive in this case.5 [Negros Navigation Co., v. Court of Appeals, 281 SCRA 534 (1997).]In any event, the Court of Appeals made similar findings of gross negligence amounting to bad faith on the part of petitioner.6[Rollo, pp. 34-35.]

Third. Petitioner contends that the Court of Appeals erred in not holding that the total loss of the vessel extinguished its liability pursuant to the ruling in Vasquez v. Court of Appeals.7[138 SCRA 553 (1983).]

It does not appear through that the Court of Appeals ever passed upon this question for the reason that petitioner did not raise it there. Thus, petitioner cannot raise this issue for the first time on appeal in this Court.

In any case, the Court's ruling in Vasquez was that despite the total loss of the vessel, its insurance answers for the damages that a shipowner or agent may be held liable to its passengers, implying that an action for damages can still be instituted against the shipowner or agent. Indeed, the rule is well-settled that a shipowner may be held liable for injuries to passengers notwithstanding the exclusively real and hypothecary nature of maritime law if, as in this case, fault can be attributed to the shipowner.8[Negros Navigation Co., Inc. v. Court of Appeals, 281 SCRA 543 (1997).]

For the foregoing reasons, the Court RESOLVED to DENY the petition for lack of showing that the Court of Appeals committed any reversible error.

Very truly yours,

TOMASITA M. DRIS

Clerk of Court

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