International Films Ltd. (China) vs Lyric Film
ISSUE:
Exchange (1936)
[Villa-Real]
Summary and Doctrine:
I. FACTS:
Bernard Gabelman was the Philippine agent of
International Films Ltd. (China). By virtue of a power of
attorney, Bernard leased the film entitled “Monte Carlo
Madness” to defendant company, Lyric Film Exchange
from June 1 to June 22, 1993on different theatres, for
a price certain on some, and 30% commission on some
days. One of the conditions was that the defendant
company would answer for the loss of the film
whichever the cause.
On June 23, the Chief of the film department of the
defendant company, Vicente Albo, called Bernard
Gabelman and asked him when and how he wanted
the film to be returned. Gabelman went to Albo’s office
and asked the latter whether he could deposit the film
in the defendant company’s vault as the plaintiff
company did not yet have a safety vault. After the case
had been referred to O’Malley, Albo’s Chief, the former
answered that the deposit cannot be made since it
cannot be covered by insurance. Gabelman then
requested to permit the deposit under Gabelman’s
responsibility. There was a verbal contract between
Gabelman and Albo, whereby the film would be shown
elsewhere and O’Mally agreed to store it in the vault
under Gabelman’s responsibility.
On July 1933, Gabelman severed his connection with
the plaintiff company, and he was succeeded by
Lazarus Joseph. The former informed Joseph about its
arrangement with defendant company as its subagent.
As soon as Lazarus Joseph took the Philippine agency,
he went to the office of Albo and asked for the return of
the film and 2 other films. The other films were returned
except for Monte Carlo Madness because it was to be
shown in Cebu on August 29 and 30. Lazarus agreed.
It happened, however, that the Bodega of the
defendant company was burned on August 19 together
with the film.
II.
WON defendant company is responsible to the plaintiff
for the destruction by fire of the film – NO.
III. RATIONALE:
The preponderance of evidence shows that the verbal
agreement had between Bernard Gabelman, the
former agent of the plaintiff company, and Vicente
Albo, chief of the film department of the defendant
company, was that the said film "Monte Carlo
Madness" would remain deposited in the safety vault
of the defendant company under the responsibility of
said former agent and that the defendant company,
as his subagent, could show it in its theaters, the
plaintiff company receiving 5 per cent of the receipts up
to a certain amount, and 15 per cent thereof in excess
of said amount.
The fact that the film was not insured against fire does
not constitute fraud or negligence on the part of the
defendant company, the Lyric Film Exchange, Inc.,
because as a subagent, it received no instruction to
that effect from its principal and the insurance of
the film does not form a part of the obligation
imposed upon it by law. The “Monte Carlo Madness”
is not covered by the insurance policy of the defendant
company, as known even from the first transaction of
O’Malley and Gabelman, where the latter took
responsibility in case of destruction or loss. It cannot
be shown, then, that the defendant company was
enriched by the destruction by fire, serving no liability.
IV. DISPOSITIVE:
WHEREFORE, appealed judgment is affirmed, with
costs to the appellant.