GR No.

172682, July 27, 2016

Sulpicio Lines Inc. (Petitioner) v Napoleon Sisante (Respondents)
First Division
Ponente: Bersamin, J.

Nature of Action: Action for damages for breach of contract of carriage.

FACTS:

The M/V Princess of the Orient, a passenger vessel owned and operated by the petitioner, sank near
Fortune Island in Batangas. Of the 388 recorded passengers, 150 were lost. Napoleon Sesante, then a member of
the Philippine National Police (PNP) and a lawyer, was one of the passengers who survived the sinking. He sued the
petitioner for breach of contract and damages. In its defense, the petitioner insisted on the seaworthiness of the
M/V Princess of the Orient due to its having been cleared to sail from the Port of Manila by the proper authorities;
that the sinking had been due to force majeure; that it had not been negligent; and that its officers and crew had
also not been negligent because they had made preparations to abandon the vessel because they had launched
life rafts and had provided the passengers assistance in that regard. The RTC rendered judgement in favor of
plaintiff Napoleon Sesante and ordered defendant to pay temperate and moral damages. The RTC observed that
the petitioner, being negligent, was liable to Sesante pursuant to Articles 1739 and 1759 of the Civil Code. The CA
reduced the award of the temperate damages to the approximate cost of Sesante's lost personal belongings and
held that petitioner remained civilly liable.

The petitioner has attributed the sinking of the vessel to the storm notwithstanding its position on the
seaworthiness of M/V Princess of the Orient. Yet, the findings of the BMI directly contradicted the petitioner's
attribution, as the BMI found that petitioner’s fault was the immediate and proximate cause of the sinking due to
the Captain's erroneous maneuvers of the M/V Princess of the Orient minutes before she sunk.

ISSUE:

Whether or not the petitioner is liable for moral damages.

RULING:

Yes. The Court awarded moral damages due to the totality of the negligence by the officers and crew of
the Princess of the Orient coupled with the seeming indifference of the petitioner to render assistance to Sesante.

The petitioner argues that moral damages could be meted against a common carrier only in the following
instances, to wit: (1) in the situations enumerated by Article 2201 of the Civil Code; (2) in cases of the death of a
passenger; or (3) where there was bad faith on the part of the common carrier. It contends that none of these
instances obtained herein; hence, the award should be deleted.

We agree with the petitioner that moral damages may be recovered in an action upon breach of contract
of carriage only when: (a) death of a passenger results, or (b) it is proved that the carrier was guilty of fraud and
bad faith, even if death does not result. However, moral damages may be awarded if the contractual breach is
found to be wanton and deliberately injurious, or if the one responsible acted fraudulently or with malice or bad
faith.

The negligent acts of the officers and crew of M/V Princess of the Orient could not be ignored in view of
the extraordinary duty of the common carrier to ensure the safety of the passengers. The totality of the negligence
by the officers and crew of M/V Princess of the Orient, coupled with the seeming indifference of the petitioner to
render assistance to Sesante, warranted the award of moral damages.