Rizal Surety and Insurance Co vs Manila Railroad Co and Manila Port Service

Facts:

On Nov 29, 1960, a vessel named SS Flying Trader, loaded on board a cargo which is an offset press machine, from Italy to Manila. Upon reaching the port of destination and upon unloading it, it was dropped b the crane which resulted to damages of the machine. The plaintiff as the insurer had paid the consignee, Suter, Inc. the amount of P16.5k for the machine and P180.70 for the International Adjustment Bureau as adjuster’s fee. However, the arrastre charges in this particular shipment was paid on the weight or measurement basis whichever is higher, and not on the value thereof.

Issue:

Can the insurance get an amount greater than what was declared?

Held:

Plaintiff Insurance Company cannot recover from defendants an amount greater than that to which the consignee could lawfully lay claim. The management contract is clear, the amount is limited to P500.

If the plaintiff's property has been insured, and he has received indemnity from the insurance company for the injury or loss arising out of the wrong or breach of contract complained of, the insurance company shall be subrogated to the right of the insured against the wrong-doer or the person who has violated the contract. If the amount paid by the insurance company doer not fully cover the injury or loss, the aggrieved party shall be entitled to recover the deficiency from the person causing the loss or injury.

The insurance have no greater right than the party in interest thereof.