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Vedia Genon II
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51

H.E. Heacock Co. v. Macondray & Co.

FACTS: HE Heacock caused to be delivered on board the steamship Bolton Castle in the harbor of New
York 4 cases of merchandise for transportation to Manila. Under the bill of lading it is mutually agreed that
the value of the goods receipted for the above does not exceed $500 per freight ton, or, in proportion for
any part of a ton, unless the value be expressly stated herein and ad valorem freight paid thereon. NO
DELIVERY WAS MADE. Plaintiff insists that it is entitled to the market value of the clocks – P420.
Defendant contends in accordance with clause 1, plaintiff is entitled to recover only P76.36, the
proportionate freight ton value of the clocks. Plaintiff contends that the clauses, limiting the liability of the
carrier, are contrary to public order, and therefore null and void.

ISSUE: WON a common carrier, by stipulations inserted in the bill of lading, limit its liability for the loss of
or damage to the cargo to an agreed valuation

RULING: YES. Three kinds of stipulations have often been made in a bill of lading. The first is one
exempting the carrier from any and all liability for loss or damage occasioned by its own negligence. The
second is one providing for an unqualified limitation of such liability to an agreed valuation. And the third
is one limiting the liability of the carrier to an agreed valuation unless the shipper declares a higher value
and pays a higher rate of freight. The first and second kinds of stipulations are invalid as being contrary
to public policy, but the third is valid and enforceable. A reading of clauses 1 and 9 clearly shows that the
present case falls within the third stipulation. This proposition is supported by a uniform lien of decisions
of the US SC.

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