Loadstar Shipping Co. v. Court of Appeals

Summary

Landmark maritime law case establishing carrier liability principles. Loadstar Shipping's vessel sank with total cargo loss, leading Manila Insurance Co. to sue as subrogee after paying insured. Supreme Court definitively ruled that carriers are common carriers under Civil Code Article 1732 regardless of certificate of public convenience or occasional service, and that unseaworthy vessels cannot claim limited liability protection. Court invalidated bill of lading clauses limiting carrier liability to 'owner's risk' as contrary to public policy, affirming that common carriers cannot contractually reduce their liability below extraordinary diligence standards. Case reinforces strict liability regime for common carriers and protection of cargo interests through insurance subrogation rights.