Maersk Line v. Court of Appeals

Summary

This case involves a contract of carriage dispute where Maersk Line, a shipping company, was held liable for damages due to gross negligence in delivering pharmaceutical capsules over two months late. Private respondent Efren Castillo ordered 600,000 empty gelatin capsules which were mishipped to Richmond, Virginia instead of being delivered directly to the Philippines as contracted. The Supreme Court affirmed that despite the bill of lading being a contract of adhesion with limitation clauses, the carrier remained liable under Civil Code Article 1170 for unreasonable delay constituting gross negligence. The Court awarded compensatory, moral, and exemplary damages, emphasizing that carriers must deliver goods within reasonable time even without specific contractual deadlines. This decision reinforces the principle that limitation clauses in bills of lading cannot completely absolve carriers from liability for gross negligence amounting to bad faith.