SOUTHEAST ASIA Shipping CORP vs. Seagull MARITIME CORP. and CA [2003]

doctrine

To disregard the Manning Agency Agreement and the SPOA in construing the affidavit as the CA did, thus upholding the literal interpretation of the affidavit against affiant Seaturtle, despite the circumstances under which it was accomplished, which circumstances throw light upon, explain and restrict the terms of the affidavit, would sacrifice the substantial rights of Seaturtle and thus work injustice, rather than promote justice.

contested provisions

3 That as Navales’ appointed manning agent in the PHs, Seaturtle is able, willing and ready to assume any and all liabilities that may arise or that may have arisen wrt seamen recruited and deployed by Seagull MARITIME CORP ("Seagull") for Navales and hereby assumes full and complete responsibility over all seamen/workers originally recruited and deployed by Seagull for Navales.

documents involved

·          Affidavit of Undertaking between between Seaturtle and Navales submitted to the POEA

·          Manning Agency Agreement between Navales and Seaturtle

facts

·          Philimare Shipping manning agent in the {hilippines of Navales of SG which was acting for and on behalf of Turtle Bay SG hired Nerry Balatongan to work aboard the vessel Turtle Bay.

·          A supplementary contract was later forged on Dec 6, 1982 which obliged the employer of Balatongan to insure him against death or permanent "invalidity" caused by accident on board the vessel.

·          By a Crewing Agreement, Navales, acting for Turtle Bay, Oyster Bay, and Koala Shipping, appointed Seagull Maritime Corp as its manning agent in the PHs. Seagull assumed full responsibility for all seamen deployed by Philimare.

·          Balatongan met an accident in the Suez Canal in Egypt. He was repatriated to the PHs. Balatongan was found to have been permanently disabled, drawing him to demand payment for total disability insurance in the sum of US$50K. His claim was denied as it was time-barred.

·          Balatongan filed a complaint against Philimare and Seagull with the POEA for nonpayment of his claim for disability insurance. POEA ruled in favor of Balatongan was awarded US$50K.

·          SC: There is no question that under the said supplementary contract of employment, it is the duty of the employer to insure the EE, during his engagement, against death and permanent invalidity caused by accident on board up to $50K.  It was not possible for private respondent to file a claim for permanent disability with the insurance company within the one-year period from the time of the injury, as his disability was ascertained to be permanent only thereafter. Petitioners did not exert any effort to assist private respondent to recover payment of his claim from the insurance company.    

affidavit of undertaking

·          Before the promulgation of this SC decision, Navales, "on behalf of Arawa Bay Shipping and Seaturtle entered into a MANNING AGENCY AGREEMENT wherein Navales appointed Seaturtle as recruiting agent for the hiring of Filipino seamen.   

·          Seagull filed a complaint at the RTC for the recovery of P1.3M it allegedly paid Balatongan. [sneaky]

·          Seaturtle, in compliance with POEA, submitted its Affidavit of Understanding stating that it was " ready to assume any and all liabilities that may arise or that may have arisen wrt seamen recruited by Seagull for Navales "

lower courts

·          RTC: Affidavit of Undertaking is explicit that it covers "all the vessels of Navales". If the defendant’s intention was indeed to limit its assumption of liability to the vessel "Arawa Bay" only, it should have stated explicitly in the affidavit just as what others do in similar affidavit of undertaking. The presence of this conflicting, inconsistent and ambiguous construction in the document would therefore lead to an interpretation against the party who caused the same.

·          CA affirmed.   

issue

WON Seaturtle should be liable for the obligation of Seagull to Batalogan.  NO.

ratio

·          Seagull was the manning agent of Navales which was acting for and on behalf of Oyster Shipping, Turtle Bay Shipping and Koala Shipping. Seaturtle was the manning agent of Navales which was acting for and on behalf of Arawa Bay Shipping.

·          Seaturtle could only have referred to liabilities that may arise or have arisen wrt seamen it recruited and deployed for Navales "acting for and on behalf of" ARAWA BAY Shipping.

·          Seaturtle appeals to a departure from the literal wordings of said affidavit and invokes the application of the doctrine of "complementary contracts construed together”.

·          Where it is necessary to determine the correct interpretation of a document for the purpose of making the intention of the parties to prevail, the Rules of Court instructs that the circumstances under which it was made may be shown.

·          Since the Affidavit of Understanding stated that Seaturtle had been appointed as the manning agent of Navales to recruit Filipino seamen for its ships, reference to the Manning Agency Agreement between the two is in order.

·          To disregard the Manning Agency Agreement and the SPOA in construing the affidavit as the CA did, thus upholding the literal interpretation of the affidavit against affiant Seaturtle, despite the circumstances under which it was accomplished, which circumstances throw light upon, explain and restrict the terms of the affidavit, would sacrifice the substantial rights of Seaturtle and thus work injustice, rather than promote justice.

·          Seaturtle was mistaken either through ignorance, lack of skill, or negligence. The affidavit does not thus express the true intention of the parties.