Freight Management Worldwide Services v. American President Lines

Summary

This Supreme Court case clarified the distinction between ship agents under Article 586 of the Code of Commerce and regular agents under the Civil Code in maritime law. Freight Management was sued by Philam Insurance after paying claims for damaged cargo transported via APL's vessel. Lower courts held Freight liable as Carotrans' ship agent for failing to report damage within 48 hours per their agreement. The Supreme Court reversed, ruling Freight was not a ship agent as it neither provisioned vessels nor handled vessel documentation, only cargo documents after unloading. While Freight was Carotrans' regular agent, the principle of relativity of contracts prevented third-party Philam from claiming benefits from their private agreement. The decision establishes important precedent distinguishing ship agency from regular agency relationships in maritime commerce, protecting agents from third-party claims based solely on contractual obligations to principals.