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G.R. No.

L-42926 September 13, 1985

PEDRO VASQUEZ, SOLEDAD ORTEGA, CLETO B. BAGAIPO, AGUSTINA VIRTUDES, ROMEO VASQUEZ and
MAXIMINA CAINAY, petitioners,
vs.
THE COURT OF APPEALS and FILIPINAS PIONEER LINES, INC., respondents.

FACTS:

 MV Pioneer Cebu was owned and operated by the defendant Filipinas Pioneer and used in the
transportation of goods and passengers in the inter-island shipping.

 Plaintiffs Pedro Vasquez and Soledad Ortega are the parents of Alfonso Vasquez; plaintiffs Cleto Bagaipo
and Agustina Virtudes are the parents of Filipinas Bagaipo; and plaintiffs Romeo Vasquez and Maxima
Cainay are the parents of the child, Mario Marlon Vasquez.

 In May 1966, it left the port of Manila and bounded for Cebu. It had on board the spouses Alfonso
Vasquez and Filipinas Bagaipo and a four-year old boy, Mario Marlon Vasquez, among her passengers.

 The MV "Pioneer Cebu" encountered typhoon "Klaring" and struck a reef somewhere north of the island
of Cebu and subsequently sunk. The aforementioned passengers were unheard from since then.

 Plaintiffs seek the recovery of damages due to the loss of their children during said voyage.

 Defenses alleged by the defendant that the sinking of the vessel was caused by force majeure, and that
the defendant's liability had been extinguished by the total loss of the vessel.

 CFI awarded the damages. On appeal, CA reversed the decision, absolving Flipinas Pioneer from liabilities.

Issue: Whether total loss of the vessel could extinguish the liability of the shipowner?

Ruling: No.

With respect to private respondent's submission that the total loss of the vessel extinguished its liability pursuant
to Article 587 of the Code of Commerce as construed in Yangco vs. Laserna, 73 Phil. 330 [1941], suffice it to state
that even in the cited case, it was held that the liability of a shipowner is limited to the value of the vessel or to
the insurance thereon. Despite the total loss of the vessel therefore, its insurance answers for the damages that
a shipowner or agent may be held liable for by reason of the death of its passengers.

OTHER NOTES:

On defense of caso fortuito:

Upon the evidence and the applicable law, we sustain the trial Court. "To constitute a caso fortuito that would
exempt a person from responsibility, it is necessary that (1) the event must be independent of the human will; (2)
the occurrence must render it impossible for the debtor to fulfill the obligation in a normal manner; and that (3)
the obligor must be free of participation in, or aggravation of, the injury to the creditor." 1 In the language of the
law, the event must have been impossible to foresee, or if it could be foreseen, must have been impossible to
avoid. 2 There must be an entire exclusion of human agency from the cause of injury or loss.

Under the circumstances, while, indeed, the typhoon was an inevitable occurrence, yet, having been kept posted
on the course of the typhoon by weather bulletins at intervals of six hours, the captain and crew were well aware
of the risk they were taking as they hopped from island to island from Romblon up to Tanguingui. They held
frequent conferences, and oblivious of the utmost diligence required of very cautious persons, 9 they decided to
take a calculated risk. In so doing, they failed to observe that extraordinary diligence required of them explicitly by
law for the safety of the passengers transported by them with due regard for an circumstances 10 and
unnecessarily exposed the vessel and passengers to the tragic mishap. They failed to overcome that presumption
of fault or negligence that arises in cases of death or injuries to passengers.