1. Paris-Manila Perfume Co. v. Phoenix Assurance Co.

(1926)

Facts:

• May 22, 1924: A fire insurance policy was issued by Phoenix Assurance Co pany, Li ited
to Messrs" Paris#Manila Per$uery Co" %Peter &ohnson, Prop"' $or P1(,)))

O also insured with other insurance copanies $or P1,2)) and P*,))) respecti+ely

 &uly 4, 1924: he Per$uery was burned unknown o$ the cause totalling a loss
o$ P(/")2*"*0

Phoenix re$used to pay nor to appoint an arbitrator stating that the policy did not
co+er any loss or daage occasioned by explosion and stating that the clai was
$raudulent

• C: ordered Phoenix to pay P1(,)))

• Phoenix appealed

O  he insurance policy contains:

nless otherwise expressly stated in the policy the insurance does not co+er

%h' Loss or daage occasioned by the explosion3 but loss or daage by explosion o$ gas
$or illuinating or doestic purposes in a building in which gas is not generated and which
does not $or a part o$ any gas works, will be deeed to be loss by fire within the
eaning o$ this policy"

556: 78 Phoenix should be liable $or the loss because there was no explosion which is an
exeption $ro the policy

6L;: <65"

• $ it be a $act that the fire resulted $ro an explosion that $act, i$ pro+en, would be a
coplete de$ense, the burden o$ the proo$ o$ that $act is upon the de$endant, and upon
that point, there is a $ailure o$ proo$

lower court $ound as a $act that there was no $raud in the insurance, and that the +alue
o$ the property destroyed by the fire was ore than the aount o$ the insurance"

(" C=< >AK65 5AC6 C=P" @5" LAA >A< B C=MM< ML#PP=56
C==P6A@6, C" "" o"1(0914, &anuary 2*, 2))2

Facts:

Country >ankers nsuran ce Corp" %C>C' insured the building o$ respondent Lianga >ay and
Counity Multi#Purpose Corp", nc" against fire, loss, daage, or liability during the period
starting &une 2), 199) $or the su o$ Php"2)),)))"))" =n &uly 1, 19/9 at about 12:4) in the
orning a fire occurred" he respondent filed the insurance clai  but the petition denied the
sae on the ground that the building was set on fire by two PA rebels and that such loss was
an excepted risk under par"0 o$ the conditions o$ the insurance policy that the insurance does
not co+er any loss or daage occasioned by aong others, utiny, riot, ilitary or any
uprising"
espondent filed an action $or reco+ery o$ loss, daage or liability against petitioner and the rial
Court ordered the petition to pay the $ull +alue o$ the insurance"

ssue: 7hether or not the insurance corporation is exepted to pay based on the exception
clause in the insurance policy"

eld: he 5upree Court held that the insurance corporation has the burden o$ proo$ to
show that the loss coes within the pur+iew o$ the exception or liitation set#up" >ut the
insurance orporation cannot use a witness to pro+e that the fire was caused by the PA
rebels on the
not be recei+ed as proo$ o$ the truth o$ what he has learned" he petitioner, $ailing to pro+e the
exception, cannot rely upon on exe ption or exception clause in the fire insurance policy" he
petition was granted"

4" Malayan Insurance Co., Inc. vs. CA G.R. No. $-36&13, 26 Seem*er 19++

acs

Malayan nsurance Co" nc" %MALA<A' issued a Pri+ate Car Coprehensi+e Policy co+ering a
7illys jeep" he insurance co+erage was $or Eown daageE not to exceed P0))")) and Ethird#
party liabilityE in the aount o$ P2),)))"))" ;uring the effecti+ity o$ the insurance policy, , the
insured jeep, while being dri+en by one &uan P" Capollo an eployee o$ the respondent 5an
Leon ice Mill, nc", %5A L6=' collided with a passenger bus belonging to the respondent
Pangasinan ransportation Co", nc" %PAAC=' at the national highway in >arrio 5an Pedro,
osales, Pangasinan, causing daage to the insured +ehicle and injuries to the dri+er, &uan P"
Capollo, and the respondent Martin C" @allejos, who was riding in the ill#$ated jeep"

Martin C" @allejos filed an action $or daages against 5io Choy, Malayan nsurance Co", nc" and
the PAAC= be$ore the Court o$ First nstance o$ Pa ngasinan" he trial court rendered
 judgent holding 5io Choy, 5A L6=, and MALA<A jointly and se+erally liable" owe+er,
MALA<As liability will only be up to P2),)))"

=n appeal, CA affired the decision o$ the trial court" owe+er, it ruled that 5A  L6=  has no
obligation to indeni$y or reiburse the petitioner insurance copany $or whate+er aount it
has been ordered to pay on its policy, since the 5an Leon ice Mill, nc" is not a pri+y to the
contract o$ insurance between 5io Choy and the insurance copany"

MALA<A appealed to the 5C by way o$ re+iew on certiorari"

Issues

%1' 7hether or not MALA<A is solidarily liable to @allejos, along with 5io Choy and 5A L6=

%2' 7hether or not MALA<A is entitled to be reibursed by 5A L6= $or whate+er aount
petitioner has been adjudged to pay respondent @allejos on its insurance policy"

/el0

%1' =nly 5io Choy and 5A L6= are solidarily liable to @allejos $or the award o$ daages" 5io
Choy is liable as owner o$ the jeep pursuant to Article 21/4, while 5A L6= is liable as the
eployer o$ the dri+er o$ the jeep at the tie o$ the accident pursuant to Art 21/)"

MALA<As liability, howe+er, arose only out o$ the insurance policy with 5io Choy" Petitioner as
insurer o$ 5io Choy, is liable to respondent @allejos, but it cannot, as incorrectly held by the
trial court, be ade EsolidarilyE liable with the two principal tort$easors naely respondents 5io
Choy and 5A L6="

%2' MALA<A is entitled to be reibursed" pon payent o$ the loss, the insurer is entitled to be
subrogated pro tanto to any right o$ action which the insured ay ha+e against the third person
whose negligence or wrong$ul act caused the loss" 7hen the insurance copany pays $or the
loss, such payent operates as an eHuitable assignent to the insurer o$ the property and all
reedies which the insured ay ha+e $or the reco+ery thereo$" hat right is not dependent
upon , nor does it grow out o$ any pri+ity o$ contract or upon written assignent o$ clai, and
payent to the insured akes the insurer assignee in eHuity"

*" @da" ;e abriel +" CA, "" o" 1)(//( o+eber 14, 1990 FAC5

Marcelino abriel was eployed by 6erald Construction B ;e+elopentCorporation %6erald

Construction $or bre+ity' at its construction project in raH" e wasco+ered by a personal
accident
 he insured risk was $or bodily injurycaused by +iolent accidental external and +isible eans
which injury would solely andindependently o$ any other cause result in death or disability"=n 22
May 19/2, within the li$e o$ the policy, abriel died in raH" =n 12 &uly 19/(,6erald Construction
reported abriels death to Fortune nsurance by telephone" Aongthe docuents therea$ter
subitted to Fortune nsurance were a copy o$ the deathcertificate issued by the Ministry o$ 
ealth o$ the epublic o$ raH which stated that anautopsy report by the ational >ureau o$ 
n+estigation was conducted to the effect that dueto ad+anced state o$
postorte decoposition, the cause o$ death o$ abriel couldnot be deterined"

>ecause o$ this de+elopent Fortune nsurance ultiately denied the clai o$

6erald Construction on the ground o$ prescription" abriels widow, &acHueline &ieneI,went
to the to the lower court" n her coplaint against 6erald Construction and
Fortunensurance, sh e a+erred that her husband died o$ electrocution while in the per$orance o$
his work"Fortune
nsurance alleged that since both the death certificate issued by the raHiMinistry o$ ealth and
the autopsy report o$ the > $ailed to disclose the cause o$ abrielsdeath, it denied liability
under the policy" n addition, pri+ate respondent raised the de$enseo$ prescription,
in+oking 5ection (/4 o$ the nsurance Code"

556: 7= &acHueline &ieneI +da" de abriels clai agains t Fortune nsurance should
bedenied on the ground o$ prescription

6L;:

 <es" 5ection (/4 o$ the nsurance Code pro+ides: 5ec" (/4" Any person ha+ing any clai
upon the policy issued pursuant to this chapter shall, without any unnecessary delay, present
to the insurance copany concerned a written notice o$ clai setting $orth the nature, extent and
duration o$ the injuries sustained as certified by a duly licensed physician" otice o$ clai ust
be filed within six onths $ro date o$ the accident, otherwise, the clai shall be deeed
wai+ed" Action or suit $or reco+ery o$ daage due to loss or injury ust be brought, in proper
cases, with the Coissioner or the Courts within one year $ro denial o$ the clai, otherwise,
the claiants right o$ action shall prescribe" he notice o$ death was gi+en to Fortune nsurance,
concededly, ore than a year a$ter the death o$ +da" de abriels husband" Fortune nsurance, in
in+oking prescription, was not re$erring to the one#year period $ro the denial o$ the clai within
which to file an action against an insurer but ob+iously to the written notice o$ clai that had to
be subitted within six onths $ro the tie o$ the accident"

@da" de abriel argues that Fortune nsurance ust be deeed to ha+e wai+ed its right to show
that the cause o$ death is an excepted peril, by $ailing to ha+e its answers duly +erified" t is true
that a atter o$ which a written reHuest $or adission is ade shall be deeed ipliedly
aditted unless, within a period designated in the reHuest, which shall not be less than 1) days
a$ter ser+ice thereo$, or within such $urther tie as the court ay allow on otion and notice,
the party to who the reHuest is directed ser+es upon the party reHuesting the adission a
sworn stateent either denying specifically the atters o$ which an ad ission is reHuested or
setting $orth in detail the reasons why he cannot truth$ully either ad it or deny those atters3
howe+er, the +erification, like in ost cases reHuired by the rules o$ procedure, is a $oral, not
 jurisdictional, reHuireent, and ainly intended to secure an assurance that atters which are
alleged are done in good $aith or are true and correct and not o$ ere speculation"

7hen circustances warrant, the court ay siply order the correction o$ un+erified pleadings
or act on it and wai+e strict copliance with the rules in order that the ends o$ justice ay
thereby be ser+ed" n the case o$ answers to written reHuests $or adission particularly, the
court can allow the party aking the adission, whether ade expressly or deeed to ha+e been
ade ipliedly, to withdraw or aend it upon such ters as ay be just" he insurance policy
expressly pro+ided that to be copensable, the injury or death should be caused by
+iolent accidental external and +isible eans" n attepting to pro+e the cause o$ her husbands
 was still $unctioning, and +da" de abriels sworn affida+it" he said affida+it, howe+er,
suffers
$ro procedural infirity as it was not e+en testified to or identified by +da" de abriel hersel$"
 his affida+it there$ore is a ere hearsay under the law"

n like anner, the letter allegedly written by the deceaseds co#worker which was
ne+er identified to in court by the supposed author, suffers $ro the sae de$ect as the
affida+it o$
+da" de abriel" ot one o$ the other docuents subitted, to wit, the P=6A decision, the death
certificate issued by the Ministry o$ ealth o$ raH and the > autopsy report, could gi+e any
probati+e +alue to +da" de abriels clai" he P=6A decision did not ake any categorical
holding on the specific cause o$ abriels death" n suary, e+idence is utterly wanting to
establish that the insured suffered $ro an accidental death, the risk co+ered by the policy"

0" F nsurance Corporation +" CA %2))*'

Lessons Applicable: Loss caused by negl gence o$ the insured %nsurance'

FAC5:

• Anco 6nterprises Copany %AC=', a partnership between Ang ui and Co o, was
engaged in the shipping business operating two coon carriers

O M8 AC= tugboat

O ;8> Lucio barge # no engine o$ its own, it could not aneu+er by itsel$ and had to
be towed by a tugboat $or it to o+e $ro one place to another"

• 5epteber 2( 19J9: 5an Miguel Corporation %5MC' shipped $ro Mandaue City, Cebu, on
board the ;8> Lucio, $or towage by M8 AC=:

O 2*,))) cases Pale Pilsen and (*) cases Cer+eIa egra # consignee 5MCs
>eer Marketing ;i+ision %>M;'#6stancia >eer 5ales =ffice, 6stancia, loilo

O 1*,))) cases Pale Pilsen and 2)) cases Cer+eIa egra # consignee 5MCs >M;#5an
 &ose >eer 5ales =ffice, 5an &ose, AntiHue

5epteber (), 19J9: ;8> Lucio was towed by the M8 AC= arri+ed and M8 AC= le$t the
barge iediately

O  he clouds were dark and the wa+es were big so 5MCs ;istrict 5ales
5uper+isor, Fernando Macabuag, reHuested AC=s representati+e to trans$er the
barge to a sa$er place but it re$used so around the idn ight, the barge
sunk along with 29,21) cases o$ Pale Pilsen and *)) cases o$ Cer+eIa
egra totalling to P1,(40,19J

• 7hen 5MC claied against AC= it stated that they agreed that it would not be liable $or
any losses or daages resulting to the cargoes by reason o$ $ortuitous e+ent and it was
agreed to be insured with F $or 2),))) cases or P/*/,*))

• AC= filed against F

O F alleged that AC= and 5MC $ailed to exercise ordinary diligence or the
diligence o$ a good $ather o$ the $aily in the care and super+ision o$ the cargoes

C: AC= liable to 5MC and F liable $or *(K o$ the lost cargoes

• CA affired
556: 78 F should be exepted $ro liability to AC= $or the lost cargoes because o$ a
$ortuitous e+ent and negligence o$ AC=
6L;: <65" Affir ed with  odification" hird#party co plainant is dis issed"

• Art" 1J((" Co  on carriers, $ro the nature o$ their business and $or reasons o$ public
policy are bound to obser+e extraordinary diligence in the +igilance o+er the goods and $or
the sa$ety o$ the passengers transported by the , according to all the circu stances o$
each case"

5uch extraordinary diligence in +igilance o+er the goods is $urther expressed in Articles 1J(4,
1J(*, and 1J4* os" *, 0, and J " " "

• Art" 1J(4" Coon carriers are responsible $or the loss, destruction, or deterioration o$
the goods, unless the sae is due to any o$ the $ollowing causes only:

%1' Flood, stor, earthHuake, lightning, or other natural disaster or calaity3

" " "

Art" 1J(9" n order that the coon carrier ay be exepted $ro responsibility, the
natural disaster ust ha+e been the proxiate and only cause o$ the loss" owe+er, the
coon carrier ust exercise due diligence to pre+ent or iniiIe loss be$ore, during
and a$ter the occurrence o$ flood, stor, or other natural disaster in order that the
coon carrier ay be exepted $ro liability $or the loss, destruction, or deterioration
o$ the goods " " "

Caso $ortuito or $orce ajeure

O extraordinary e+ents not $oreseeable or a+oidable, e+ents that could not be

$oreseen, or which though $oreseen, were ine+itable

O not enough that the e+ent should not ha+e been $oreseen or anticipated, as is
coonly belie+ed but it ust be one ipossible to $oresee or to a+oid # not in this
case

other +essels in the port o$ 5an &ose, AntiHue, anaged to trans$er to another
place

 o be exepted $ro responsibility, the natural disaster should ha+e been the proxiate
and only cause o$ the loss" here ust ha+e been no contributory negligence on the part
o$ the coon carrier"

O there was blatant negligence on the part o$ M8 AC=s crewebers, first in
lea+ing the engine#less barge ;8> Lucio at the ercy o$ the stor without the
assistance o$ the tugboat, and again in $ailing to heed the reHuest o$
5MCs representati+es to ha+e the barge trans$erred to a sa$er place

• 7hen e+idence show that the insureds negligence or recklessness is so gross as to be

sufficient to constitute a will$ul act, the insurer ust be exonerated"

AC=s eployees is o$ such gross character that it aounts to a wrong$ul act which ust
exonerate F $ro liability under the insurance contract

O both the ;8> Lucio and the M8 AC= were blatantly negligent

. Sun v CA G.R. No. 923+3 uly 1, 1992

Facts:

Li accidentally killed hisel$ with his gun a$ter reo+ing the agaIine, showing off, pointing
the gun at his secretary, and pointing the gun at his teple" he widow, the beneficiary, sued
the petitioner and won 2)),))) as indenity with additional aounts $or other daages and
attorneys $ees" his was sustained in the Court o$ Appeals then sent to the 5upree court by the
insurance copany"
1" 7as Lis widow eligible to recei+e the benefits

2" 7ere the other daages +alid

eld:

1" <es 2" o

atio: 1" here was an accident"

;e la CruI +" Capital nsurance says that Ethere is no accident when a deliberate act is
per$ored unless soe additional, unexpected, independent and un$oreseen happening occurs
which produces or brings about their injury or death"E his was true when he fired the gun"

nder the insurance contract, the copany wasnt liable $or bodily injury caused by attepted
suicide or by one needlessly exposing hisel$ to danger except to sa+e anothers li$e"

Li wasnt thought to needlessly expose hisel$ to danger due to the witness testiony that he
took steps to ensure that the gun wasnt loaded" e e+en assured his secretary that the gun was
loaded"

 here is nothing in the policy that relie+es the insurer o$ the responsibility to pay the indenity
agreed upon i$ the insured is shown to ha+e contributed to his own accident"

2" Nn order that a person ay be ade liable to the payent o$ oral daages, the law
reHuires that his act be wrong$ul" he ad+erse result o$ an action does not per se ake the act
wrong$ul and subject the act or to the payent o$ oral daages" he law could not ha+e eant
to ipose a penalty on the right to litigate3 such right is so precious that oral daages ay not
be charged on those who ay exercise it erroneously" For these the law taxes costs"O

$ a party wins, he cannot, as a rule, reco+er attorneys $ees and litigation expenses, since it is
not the $act o$ winning alone that entitles hi to reco+er such daages o$ the exceptional
circustances enuerated in Art" 22)/" =therwise, e+ery tie a de$endant wins, autoatically
the plaintiff ust pay attorneys $ees thereby putting a preiu on the right to litigate which
should not be so" For those expenses, the law dees the award o$ costs as sufficient"O

/" "" o" L#(*/4/ o+eber 22, 19(2

 6 6A5 F6 C",

plaintiff#appellant,+s"

 6 L=>6 B 65 F6 5AC6 C=" =F 67 <=K,

de$endant#appellee"

################"" o" L#(*/49 o+eber 22, 19(26 6A5 F6 C",

plaintiff#appellant,+s"

C=MM6CAL = A55AC6 C=MPA<, L;",

de$endant#appellee"

################"" o" L#(*/*) o+eber 22, 19(26 6A5 F6 C",

plaintiff#appellant,+s"

 6 C=6AL 5AC6 C=" =F 67 <=K, de$endant#appellee"

Facts:

Plaintiff is a duly registered partnership engaged in the sale o$ $urniture3 that the de$endant is
inits establishent" =n March 2, 1929, a fire broke out in plaintiffs establishent, as a result
o$ which the insured articles therein $ound were destroyed by the fire";e$endants de$enses are:
%1' that the fire in Huestion was o$ intentional origin3 %2' that the claiso$ loss presented by
the plaintiff were $alse and $raudulent3 %(' that the $urniture in Huestion had been ortgaged
by the plaintiff to the Manila Finance and ;iscount Corporation, so that at thetie o$ the fire the
plaintiff  was not the only party interested therein, contrary to therepresentations ade in its
clais o$ loss3 and %4' that the plaintiff +iolated one o$ the conditionso$ the policies by re$using to
$urnish the de$endants with a physical in+entory o$ the contents o$ its store at the tie o$ the
fire"

>y agreeent o$ the parties the three cases were tried jointly who a$ter the trial $ound that
theclais presented by the plaintiff were notoriously $raudulent, and, accordingly,
sustainedde$endants second special de$ense and disissed the coplaint in each o$ the three
cases"ence, this petition"

ssue:78 fire was o$ intentional origin78 the clai o$ loss were $raudulent

uling:

Fire o$ ntentional =rigin

7e are thus led to the conclusion that de$endants first special de$ense is well $ounded Q that
thefire in Huestion was o$ intentional origin and was caused with the conni+ance o$ the plaintiff"
either the interest o$ the justice nor public policy would be prooted by an oission o$ the
courts to expose and conden incendiaris once the sae is established by copetent
e+idence"t would tend to encourage rather than suppress that great public enace i$ the courts
do notexpose the crie to public condenation when the e+idence in a case like the present
shows thatit has really been coitted"

Fraudulent clai o$ loss" 7e ay also consider the daage caused by the fire in relation with
de$endants second specialde$ense that plaintiffs clais o$ loss were $alse and $raudulent"o
each o$ the proo$s o$ loss which the plaintiff presented to the respecti+e insurance copanies
$our days a$ter the fire was attached an in+entory o$ the $urniture claied to ha+e been in the
building at the tie o$ the fire" his in+entory contains *)0 pieces o$ $urniture and(,J)) board
$eet o$ luber o$ the alleged total +alue o$ P*2,)01"99" his aount was the totalloss claied to
ha+e been suffered by the plaintiff, although we note that in its coplaints inthese cases
aended it is conceded that soe $urniture o$ the +alue o$ about P*,))) was sa+ed"

egardless o$ any difference o$ opinion as to the +alue o$ the insured $urniture and the extent o$
the daage caused thereto by the fire in Huestion, the $act that the insured only
hadapproxiately 2)2 pieces o$ $urniture in the building at the tie o$ the fire and sought
tocopel the insurance copanies to pay $or *)0 pieces conclusi+ely shows that its clai was
nothonestly concei+ed" he trial courts conclusion that said clai is notoriously $raudulent,
is correct" Condition 12 o$ each o$ the insurance policies sued upon pro+ides that Ei$ the clai
be inany respect $raudulent, or i$ any $alse declaration be ade or used in support thereo$, or
i$ any$raudulent eans or de+ices are used by the nsured or anyone acting on his behal$ to
obtain any benefit under this policy3 or, i$ the loss or daage be occasioned by the wil$ul act, or
with theconni+ance o$ the nsured, Q all benefit under this policy shall be $or$eited"E

9" G.R. No. $-19+31 une 29, 1963

 45 AN C/5AN, plain tiff#appellant,

+s"
I7$8M7NS INS5RANC7 C:., INC., 7; A$., de$endants#appellants"

Facts:

Plaintiff <u >an Chuan began his business enterprise under the nae o$ ECMC rading"E he
plaintiff insured against fire the stock erchandise contained therein with de$endant Fieldens
nsurance Co" an E openE policy liiting the insurers liability to the aount o$ P2)),))) $or a
liiting liability thereunder to P14),))) $or a one#year period3 herea$ter, Fieldens agreed to
trans$er the co+erage o$ its insurance policy to plaintiffs different store where he
trans$erred3 Paraount also agreed to ha+e the co+erage o$ its insurance policy trans$erred to
the sae new preises and acknowledged the existence o$ its co#insurance with Fieldens3
Fieldens also acknowledged its co#insurance with Paraount3 while both insurance policies
were in $ull $orce and effect, plaintiffs business establishent, was totally destroyed by fire"

 he next day a$ter the occurrence o$ the fire, plaintiff +erbally notified the respecti+e agents o$ 
the de$endants#insurers o$ such incident3 and on the sae day, plaintiff and " "
>ayne Adjustent Co" and Manila Adjustent Co", adjusters o$ de$endants Fieldens and
Paraount, respecti+ely, executed Enon#wai+erE
agreeents $or the purpose o$ deterining the
circustances o$ the fire and the +alue or aount o$ loss and daage to the erchandise
insured under said policies" Pursuant to such agreeents, " " >ayne Adjustent Co" sent a
letter to plaintiff, and Manila Adjustent Co" sent its letter, reHuiring the plaintiff to subit
certain papers and docuents" Plaintiff ga+e a written notice o$ the occurrence o$ the fire to the
de$endants, and, in answer to the letters o$ the adjusters, plaintiff subitted his separate $oral
fire clais, together with soe o$ the supporting papers reHuired therein" >ecause o$ plaintiffs
non#copliance or $ailure to subit the reHuired docuents and the adjusters deand in
subseHuent letters that the insured subit additional papers, the adjusters and plaintiff engaged
in an exchange o$ counications, until finally the de$endants rejected plaintiffs clais, and
denied liability under their respecti+e policies, e+idently upon their respecti+e
adjusters recoendations"

ssue: 78 the insurer is liable"

eld:

=" he plaintiff adheres to the in+entory as the iaculate basis $or the actual worth o$ stocks
that were burned, on the ground that it was ade $ro actual count, and in copliance with law"
>ut this in+entory is not binding on the de$endants, since it was prepared without their
inter+ention" t is well to note that plaintiff had e+ery reason to show that the +alue o$ his stock
o$ goods exceeded the aount o$ insurance that he carried" And the in+entory, ha+ing been
ade prior to the fire, was no proo$ o$ the existence o$ these goods at the store when the fire
occurred" rue, there were erchandise that were actually destroyed by fire" >ut when $raud is
concei+ed, what is true is subtly hidden by the scheer beneath proper and legal appearances,
including the preparation o$ the in+entory"

 he filing o$ collection suits $or unpaid purchases against <u >an Chuan, howe+er +alid these ay
be, do not legitiiIe his $raudulent clai against the insurers in the present case, nor show that
the goods allegedly deli+ered were at the store when the fire occurred" t is arkworthy that in
soe instances the debts are only attested by certifications $ro the creditors"

 he plaintiff, <u >an Chuan, is a Chinese who cae to this country in 194/" is cobined incoe
$ro 19*0 through 19*/ aounted to only P1),)))" <et in 19*9 he appeared as running a,
business o$ his own worth alost hal$ a illion pesos" he source o$ the in+estent, accordingly
to hi, were unsecured loans in the $antastic su o$ P224,)))"))" Fro these circustances,
and the $acts herein be$ore stated, it is plain that no credence can be gi+en to plaintiffs clais"

1)" Yu Cua v. South British Insurance Co.

11" G.R. No. $-22&9+ 8ecem*er 16, 192&

A.M. ;5AS:N,  plaintiff#appellant,

+s"
N:R;/ C/INA INS5RANC7 C:MPAN4, $;8.
Facts:
About idnight o$ the 2/th o$ &anuary, 1922, a fire broke out in the @anity Fair, a erchantile
establishent owned by A"M" uason, de+oted to the sale o$ dry goods and ebroidery and to
conducting a as sage and anicuring parlor and tea roo" ;ue to the proptness and
efficiency o$ the Manila fire departent, the fi+e was placed under control be$ore it had done
ore than destroy a part o$ the building with its eHuipent and erchandise" he presence o$ 
dry goods saturated with spirits o$ turpentine and other +ery suspicious circustances, resulted
in &" LorenIo, deputy chie$ o$ the fire departent, reporting that the cause o$ the fire was
Encendiary """ international"E

At that tie, the @anity Fair was insured with the Li+erpool B London B lobe
nsurance Copany, Ltd", and the orth China nsurance Copany, Ltd", under se+en policies,
totaling P2)),)))" Fi+e o$ these policies had been taken out by Mr" uason on ;eceber 14,
1921, and two had been taken out on &anuary 10, 1922"

Mr" uason laid clai to P191,((0"J4" 7hen said clai was rejected by the insurance copanies"
 he principal de$enses set up by the de$endants were, first, that all benefit under the policies had
been $or$eited because $alse, $raudulent, and fictitious declarations had been ade the
de+ices to obtain payent3 and, second, that the fi+e was caused by the will$ul act o$ the
plaintiff and those instigated by an in conni+ance with hi"

ssue: 78 the insurers are liable"

eld:

o" he difference between the $oral clai o$ approxiately P19),))), or, deducting the
aount asked $or the $urniture, o$ o+er P1J),))), and P(),))), the top figure conceded
by ipartial witnesses, is so great as to indicate $alse stateents ade intentionally and will$ully"
5uch $acts bring into +iew the twel$th condition o$ the policies pro+iding: E$ the clai be in any
respect $raudulent, or i$ any $alse declaration be ade or used in support thereo$, or i$ any
$raudulent eans or de+ices are used by the insured or anyone acting on his behal$ to obtain any
benefit under this policy3 or i$ the loss or daage be occasioned by the will$ul act, or with the
conni+ance o$ the insured """ all benefit under this policy shall be $or$eited"E his clause, with its
un$ortunate relation to the pro+en $acts, calls $or the application o$ the doctrine that $alse and
aterial stateents ade with an intent to decei+e or de$raud, a+oid the insurance policies"

12" G.R. No. $-13331. Novem*er 29 196<.

8A=I8 C:NS5NI an0 R787S=IN8A A. C:NS5NI, lainiffs an0 aellees, v. ;/7

MANI$A P:R; S7R=IC7

Facts:

;a+id Consunji and Fredes+inda A" Consunji were consignees o$ 24J cartons o$ edical supplies
unloaded at the Port o$ Manila $ro the nited 5tates" As arrastre operator, the Manila Port
5er+ice took charge o$ the erchandise, and in due course deli+ered to plaintiffs or their agent
24( cartons, thereby incurring a shortage o$ $our %4' cartons"

7here$ore this coplaint in the Manila unicipal court $or the su o$ P40)"(/ representing the
in+oice +alue o$ the undeli+ered goods, plus daages and attorneys $ees totalling P02)"(0"

 he de$ense rested ainly on the $ailure o$ plaintiffs to file a clai $or the shortage within 1*
days, as pro+ided in its Manageent Contract with the >ureau o$ Custos, which reads
partly:jgc:chanrobles"co"ph

E" " " n any e+ent the contractor shall be relie+ed and released o$ any and all responsibility or
liability $or loss, daage, isdeli+ery and or non#deli+er o$ goods, unless suit in the Court o$  
proper jurisdiction is brought within a period o$ one %1' year $ro the date o$ the discharge o$ the
by the contractor, pro+ided that such clai shall ha+e been filed with the Contractor within 1*
%fi$teen' days $ro the date o$ the discharge o$ the last package $ro the carrying +essel"E

ssue: 78 the Consunji can clai"

eld:

=" Carriers or depositories soeties reHuire presentation o$ clais within a short tie a$ter
deli+ery as a condition precedent to their liability $or losses" 5uch reHuireent is not epty
$oralis" t has a definite purpose, i"e" to afford the carrier or deposi tory a
reasonable opportunity and $acilities to check the +alidity o$ the clais while the $acts are still
$resh in the
inds o$ the persons who took part in the transaction and the docuents are still a+ailable" ow,
we see no reason why Manila Port 5er+ice Q $or whose benefit the pro+ision was e+idently
inserted Q should reHuire propt presentation o$ clai in one instance, while wai+ing it in the
other"

n this connection, realiIe the seeing ineHuity o$ applying this 1*#day pro+iso where
the consignee coes to know the daage or loss only a$ter the lapse o$ such 1*#day period,
$or instance, where deli+ery by the contractor takes place 10 days a$ter discharge o$ the last
package $ro the +essel" And it ight be un$air to apply the liitation where the claiant coes
to know o$ such condition precedent only a$ter the 1*#day period" >ut such
exceptional considerations do not coe presently into play, plaintiffs ha+ing asserted none o$
the" =n the contrary, ipliedly aditting knowledge o$ both the condition and the shortage
within the 1*# day tie , they stood on the proposition, as stated, that ha+ing instituted suit
within one year a$ter the discharge o$ the goods $ro the carrying +essel, they had properly
filed their action, notwithstanding no clai had been ade within 1* days" 7here$ore, as their
position turns out to be legally untenable, the judgent ust be, and is hereby re+ersed, and
the de$endants are absol+ed $ro all liability"

1(" >achrach +" >ritish Aerican Assurance Co" %191)'

"" o" L#*J1* ;eceber 2), 191)

Lessons Applicable: 6ffect o$ Change o$ nterest in hing nsured %nsurance'

Laws Applicable:

FAC5:

• 6" M" >achrach insured goods belonging to a general $urniture store, such as iron and
brass bedsteads, toilet tables, chairs, ice boxes, bureaus, washstands, irrors, and sea#
grass $urniture stored in the ground floor and first story o$ house and dwelling with
an authoriIed agent o$ the >ritish Aerican Assurance Copany

• >ritish Aerican Assurance Copany denied alleging that:

O property co+ered by the policy to " 7" Peabody B Co" to secure certain
indebtedness due and owing to said copany

O interest in certain o$ the goods co+ered by the said policy is trasn$erred to Macke to
secure certain obligations assued by Macke and on behal$ o$ >achrach

O will$ully placed a gasoline can containing 1) gallons o$ gasoline close to the insured
goods

O ade no proo$ o$ the loss with the tie reHuired by the condition

• C: >ritish Aerican Assurance Copany liable to bACAC

6L;: <65" lower court affired

• keeping o$ inflaable oils on the preises, though prohibited by the policy, does not
556:+oid
78 >achrach can
it i$ such keeping is incidental to the business

t ay be added that there was no pro+ision in the policy prohibiting the keeping o$ paints
and +arnishes upon the preises where the insured property was stored" $ the copany
intended to rely upon a condition o$ that character, it ought to ha+e been plainly
expressed in the policy"

alienation clause # $or$eiture i$ the interest in the property pass $ro the insured

• there is no alienation within the eaning o$ the insurance law until the ortgage acHuires
a right to take possession by de$ault under the ters o$ the ortgage" o such right is
claied to ha+e accrued in the case at bar, and the alienation clause is there$ore
inapplicable"

we can not find that there is a preponderance o$ e+idence showing that the plaintiff did
actually set fire or cause fire to be set to the goods in Huestion

• t does not positi+ely appear o$ record that the autoobile in Huestion was not included in
the other policies" t does appear that the autoobile was sa+ed and was considered as a
part o$ the sal+aged" t is alleged that the sal+age aounted to P4,))), including the
autoobile" his aount %P4,)))' was distributed aong the different insurers and the
aount o$ their responsibility was proportionately reduced" he de$endant and appellant
in the present case ade no objection at any tie in the lower court to that distribution o$
the sal+age" he clai is now ade $or the first tie"

14" G.R. No. $-66396 Augus 2+, 19+&

;/7 N7@ 7A$AN8 INS5RANC7 C:MPAN4, INC., petitioner,

+s"
;/7 /:N:RA$7 IN;7RM78IA;7 APP7$$A;7 C:5R;

Facts:

A cargo o$ oats was consigned to Muller and Phipps %Manila' Ltd" he cargo was insured against
all risks by he ew Realand nsurance Co", Ltd", the petitioner herein" 7hen the cargo was
discharged se+eral cartons which contained the oats were in bad order" he consignee filed a
clai against the insurer $or the +alue o$ the daaged goods which the latter paid in the aount
o$ P1/,14/"09" he insurer as subrogee o$ the consignee sued 6" aIon, nc", the respondent
herein, who was the arrastre operator" he insurer deanded reiburseent in the aount o$
P1J,)2*"/J" he lower figure is due to the $act that the carrier responded $or its share o$ the loss
in the su o$ P1,121")2" he Court o$ First nstance o$ Manila ga+e judgent in $a+or o$ the
plaintiff" t ordered Ethe de$endant to pay to the plaintiff P1J,)2*"/J with 0K interest $ro April
2(, 19J(, until sae is paid, P1,)))")) as attoeys $ees, and the costs"E

6" aIon, nc" appealed the ad+erse decision to the Court o$ Appeals" he nterediate Appellate
Court which succeeded the Court o$ Appeals re+ersed the decision o$ the trial court E=n the
ground o$ prescription, appellee has no cause o$ action against the appellant"E

ssue: 78 the plaintiff has a clai"

eld:

 <es" he trial court has o+erlooked the significance o$ the reHuest $or, and the result o$, the bad
order exaination, which were filed and done within fi$teen days $ro the haulage o$ the goods
$ro the +essel" 5aid reHuest and result, in effect, ser+ed the purpose o$ a clai, which is Q
 Eto afford the carrier or depositary reasonable opportunity and $acilities to check the
+alidity or clais while $acts are still $resh in the inds o$ the person who took
part in the transaction and the docuents are still a+ailable"E %Consunji +s" Manila
Port 5er+ice, L#1***1, 29 o+" 190)'

ndeed, the exaination undertaken by the de$endants own inspector not only ga+e
the de$endant an opportunity to check the goods but is itsel$ a +erification o$ its own liability %C$"
Parsons ardware +s" Manila ailroad Co", L#1*1J(, May (), 1901'"