1 void, and the assured deprived of all rights of indemnity in case FAILURE TO ASSERT FORFEITURE — IN GENERAL.

— While
EMILIO GONZALES LA O,  vs.THE YEK TONG LIN FIRE AND of loss. the weight of authority is that a policy conditioned to become
MARINE INSURANCE CO. void upon a breach of a warranty is void ipso facto upon such a
(Magulo ang case) The following clause has been inserted with a typewriter in the breach without formal proceedings on the part of the insurer, yet
policies: "Subject to clauses G and A and other insurances with it is true that such conditions are inserted for the benefit of the
a special short period attached to this policy." And attached to insurer and may be waived, and that the insurer may elect to
FACTS: This is an action to recover from the defendant the Yek
said policies issued by the defendant there is a sheet of "Other continue the policy despite the breach. If it does the policy is
Tong Lin Fire & Marine Insurance Co., Ltd., the amount of two
insurances" with the amount and the assurance companies in revived and restored. Its failure to assert a forfeiture therefore is
insurance policies totaling P100,000 upon leaf tobacco belonging
blank, which, according to the appellee, constitutes a notification at least evidence tending to show a waiver thereof…
to the plaintiff La O, which was damaged by the fire that
destroyed the building on Soler Street No. 188, where said that there were other insurances existing at the time.
tobacco was stored.
ISSUE: W/N defendants contention of failure to notify defendant
2. CHUA
After the case was tried, the court below rendered judgment as meritorious
Union Manufacturing Co. Vs Philippine Guarranty Co. gr
follows: In this case and in Nos. 334568, and 33480 of this 27932 Oct 30, 1972
court, the plaintiff La O demands P290,000 from the defendant RULING: No. In the instant case it may be said that the tobacco FACTS:
assurance companies, alleging that to be the amount of the insured in the other companies was different from that insured a. Union manufacturing mortgaged property to republic bank with
insurance on his leaf tobacco which was damaged by the fire. with the defendant, since the number of bales of tobacco in the the condition of obtaining insurance over the property, Union
The plaintiff's claim against the herein defendant, the Yek Tong warehouse greatly exceeded that insured with the defendant and failed, Republic bank procured fire insurance over the same from
Lin Fire & Marine Insurance Co. being for P100,000, and against the other companies put together. And according to the doctrine the defendant Philippine Guaranty Co., Inc. , a fire occurred in
the defendants in the three other cases mentioned above, for enunciated in 26 Corpus Juris, 188, "to be insurance of the sort the premises of Union.
P190,000. After the plaintiff had presented his evidence, the prohibited the prior policy must have been insurance upon the b. Republic bank claim insurance but the defendant refused
defendant companies in cases Nos. 33458, 33868, and 33480, same subject matter, and upon the same interest therein. because when said defendant's Fire Insurance Policy was
offered to compromise with him by paying eighty-five per cent of already in full force and effect, the Union Manufacturing Co., Inc.
his claim In view of the fact that in the policies, providing that the Furthermore, the appellant cannot invoke the violation of article 3 without the consent of the defendant, Philippine Guaranty Co.,
building used for the effects insured would not be occupied by of the conditions of the insurance policies for the first time on Inc., obtained other insurance policies totalling P305,000.00 over
any other lessee, nor would be used for the deposit of other appeal; besides, as the appellee correctly contends in his brief, the same properties prior to the fire, to wit: (1) Fire Policy of New
goods, without the consent of said defendants, and inasmuch as Guillermo Cu Unjieng, who was then president and majority India Assurance Co., Ltd., for P80,000.00 for the period from
the latter alleged in their answer that the owner of the burnt shareholder of the appellant company, knew that there were May 27, 1964 to May 27, 1965 ...; (2) Fire Policy of the Sincere
building had leased the warehouse to several persons for the other insurances, at least from the attempt to raise the insurance Insurance Company for P25,000.00 for the period from October
storage of sundry articles. the court sentences the defendant the premium on the warehouse and the appellee's tobacco 7, 1963 to October 7, 1964 ...; and (3) Fire Policy of Manila
Yek Tong Lin Fire and Marine Insurance Company, Ltd., to pay deposited therein to 1 per centum, and it was later reduced upon Insurance Co. for P200,000.00 for the period from May 15, 1964
the plaintiff Emilio Gonzales La O, the amount of P100,000.  petition of the appellant itself and other assurance companies to to May 15, 1965 ... ." There is in the cover note and in the fire
0.75 per centum presented to the association of assurance insurance policy the following warranty: "[Co- Insurance
The defendant Insurance Co. duly appealed from this judgment, companies in the year 1927, and notwithstanding this, said Declared]: Nil."
contended that the trial court erred in not declaring that in as appellant did not rescind the insurance policies in question, but
much as the plaintiff failed to notify the defendant corporation in demanded and collected from the appellee the increased
writing, of other insurance policies obtained by him, he has premium. ISSUE: Whether Republic bank may claim the fire insurance
violated article 3 of the conditions of the policies in question, policy
thereby rendering these policies null and void. Article 3 of the That the defendant had knowledge of the existence of other RULING: No, Republic Bank could not recover, as payee, in
conditions of the policies in question prescribes: policies obtained by the plaintiff from other insurance companies. case of loss as its "interest may appear subject to the terms and
If, with the knowledge of existence of other insurances which the conditions, clauses and warranties" of the policy was expressed
ART. 3. Any insurance in force upon all or part of the things defendant deemed violations of the contract, it has preferred to in the appealed decision thus: "However, inasmuch as the Union
insured must be declared in writing by the insured and he should continue the policy, its action amounts to a waiver of the Manufacturing Co., Inc. has violated the condition of the policy to
cause the company to insert or mention it in the policy, and annulment of the contract, in accordance with the following the effect that it did not reveal the existence of other insurance
without such requisite said policy will be regarded as null and doctrine in 19 Cyc., 791, 792:. policies over the same properties, as required by the warranty
appearing on the face of the policy issued by the defendant and following: P30,000 with Wellington Insurance; P25,000 with MALAYAN INSURANCE CO. INC. v. PHILIPPINE FIRST
that on the other hand said Union Manufacturing Co., Inc. Empire Surety and P250,000 with Asian Surety undertaken by INSURANCE CO. INC.
represented that there were no other insurance policies at the insured Paramount on the same property covered by its policy G.R. NO. 184300, [JULY 11, 2012]
time of the issuance of said defendant's policy, and it appearing with Oriental whereas the only co-insurances declared in the
furthermore that while the policy of the defendant was in full subject policy are those of P30,000.00 with Malayan P50,000.00 FACTS: On November 18, 1993, Wyeth procured a Marine
force and effect the Union Manufacturing Co., Inc. secured other with South Sea and P25.000.00 with Victory. Policy from Philippines First to insured Wyeth’s nutritional,
fire insurance policies without the written consent of the pharmaceutical and other products usual or incidental to the
defendant endorsed on the policy, the conclusion is inevitable The defense of fraud, in the form of non-declaration of co- insured’s business while the same were being transported or
that both the Republic Bank and Union Manufacturing Co., Inc. insurances which was not pleaded in the answer, was also not shipped in the Philippines. The policy covers all risks of direct
cannot recover from the same policy of the defendant because pleaded in the Motion to Dismiss. The trial court denied the physical loss or damage from any external cause, if by land, and
the same is null and void."5 The tone of confidence apparent in respondent’s motion. Oriental filed another motion to include provides a limit of P6,000,000.00 per any one land vehicle.
the above excerpts from the lower court decision is
additional evidence of the co-insurance which could amount to
understandable. The conclusion reached by the lower court finds On December 1, 1993, Wyeth executed its annual contract of
fraud. The trial court still made Oriental liable for P 61,000. The
support in authoritative precedents. It is far from easy, therefore, carriage with Reputable. Under the contract, Reputable
for appellant Republic Bank to impute to such a decision a failure CA reversed the trial court decision. Pacific Banking filed a undertook to answer for “all risks with respect to the goods and
to abide by the law. Hence, as noted at the outset, the appeal motion for reconsideration of the said decision of the respondent shall be liable to the COMPANY (Wyeth), for the loss,
cannot prosper. An affirmance is indicated. Court of Appeals, but this was denied for lack of merit. destruction, or damage of the goods/products due to any and all
3 causes whatsoever, including theft, robbery, flood, storm,
ISSUES:
Pacific v CA earthquakes, lightning, and other force majeure while the
1. WON unrevealed co-insurances Violated policy conditions No. goods/products are in transit and until actual delivery to the
FACTS: An open fire insurance policy, was issued to Paramount 3 customers, salesmen, and dealers of the COMPANY”. The
Shirt Manufacturing by Oriental Assurance Corporation to contract also required Reputable to secure an insurance policy
indemnify P61,000.00, caused by fire to the factory’s stocks, 2. WON the insured failed to file the required proof of loss prior on Wyeth’s goods. Thus, on February 11, 1994, Reputable
to court action. signed a Special Risk Insurance Policy (SR Policy) with
materials and supplies. The insured was a debtor of Pacific
petitioner Malayan for the amount of P1,000,000.00. During the
Banking in the amount of (P800,000.00) and the goods
RULING: (1) Yes. Policy Condition 3 provides that the insured effectivity of the Marine Policy and SR Policy, Reputable
described in the policy were held in trust by the insured for received from Wyeth 1,000 boxes of Promil infant formula worth
must give notice of any insurance already in effect or
Pacific Banking under trust receipts.The policy was endorsed to P2,357,582.70 to be delivered by Reputable to Mercury Drug
subsequently be in effect covering same property being insured.
Pacific Banking as mortgagee/ trustor of the properties insured, Corporation in Libis, Quezon City. Unfortunately, on the same
Failure to do so, the policy shall be forfeited. Failure to reveal
with the knowledge and consent of private respondent to the date, the truck carrying Wyeth’s products was hijacked. The
before the loss of the 3 other insurances is a clear
effect that "loss if any under this policy is payable to the Pacific truck was recovered two weeks later but without its cargo.
misrepresentation or a false declaration. The material fact was
Banking Corporation".
asked for but was not revealed. Representations of facts are the
Philippines First pursuant to the Marine Policy, paid Wyeth
A fire broke out on the premises destroying the goods contained foundations of the contract. Pacific itself provided for the P2,133,257.00 as indemnity. Philippines First then demanded
in the building. The bank sent a letter of demand to Oriental for evidences in trial court that proved existence of reimbursement from Reputable,subrogee, however, ignored the
indemnity. The company wasn’t ready to give since it was misrepresentation. demand. Philippines First instituted an action for sum of money
awaiting the adjuster’s report. The company then made an against Reputable. Reputable then impleaded Malayan as third-
(2) Yes. Policy Condition 11 is a sine qua non requirement for
excuse that the insured had not filed any claim with it, nor party defendant in an effort to collect the amount covered in the
maintaining action. It requires that documents necessary to SR Policy. Malayan argued, among others, that under Section 5
submitted proof of loss which is a clear violation of Policy
prove and estimate the loss should be included with notice of of the SR Policy, the insurance does not cover any loss or
Condition No.11, as a result, determination of the liability of
loss. Pacific failed to submit formal claim of loss with supporting damage to property which at the time of the happening of such
private respondent could not be made.
documents but shifted the burden to the insurance company. loss or damage is insured by any marine policy and that the SR
Pacific Banking filed in the trial court an action for a sum of Failing to submit claim is failure for insurance company to reject Policy expressly excluded third-party liability.
money for P61,000.00 against Oriental Assurance. At the trial, claim. Thus, a lack of cause of action to file suit.
petitioner presented communications of the insurance adjuster to ISSUE: WON THERE IS DOUBLE INSURANCE.
Asian Surety revealing undeclared co-insurances with the 4
RULING: NONE. Section 5 does not provide for the nullity of the FACTS: only one of several re-insurers of the risks and liabilities
SR Policy but simply limits the liability of Malayan only up to the  2 shipments of cargoes of concentrates were shipped by assumed by Malayan Insurance Company, Inc., it is highly
excess of the amount that was not covered by the other Lepanto from La Union to Washington. During the sea probable that other re-insurers may likewise intervene. If
insurance policy. The Court ruled that in order to constitute a voyage, it encountered heavy weather and rough seas which petitioner is allowed to intervene, We hold that there is good and
violation of the clause, the other insurance must be upon same caused it to roll, pitch and vibrate heavily so that certain sufficient basis for the Court a quo to declare that the trial
subject matter, the same interest therein, and the same risk. shifting boards in the vessel broke and part of the cargo between Lepanto and Malayan would be definitely disrupted and
Thus, even though the multiple insurance policies involved were shifted transversely, thereby causing a list. would certainly unduly delay the proceedings between the
all issued in the name of the same assured, over the same  Lepanto notified Malayan, its insurer and another insurer of parties especially at the stage where Lepanto had already rested
subject matter and covering the same risk, it was ruled that there the accidents. Formal claims under the open policy were also its case and that the issue would also be compounded as more
was no violation of the “other insurance clause” since there was filed by Lepanto with Malayan upon the conclusion of the parties and more matters will have to be litigated. In other words,
no double insurance. Section 12 of the SR Policy, on the other voyages and the determination of the shortweight. the Court’s discretion is justified and reasonable.
hand, is the over insurance clause. More particularly, it covers
the situation where there is over insurance due to double  Malayan rejected Lepanto's insurance claim for the reason It was also held that respondent Judge committed no reversible
insurance. In such case, Section 15 provides that Malayan shall that the cargoes were inherently vicious on loading and such error in further sustaining the fourth ground of Lepanto’s
“not be liable to pay or contribute more than its ratable proportion condition caused the listing of the vessel. Opposition to the Motion to Intervene that the rights, if any, of
of such loss or damage.” This is in accord with the principle of petitioner are not prejudiced by the present suit and will be fully
 Lepanto Consolidated Mining Company filed a complaint
contribution provided under Section 94 (e) of the Insurance protected in a separate action against him and his co-insurers by
against Malayan Insurance Company. The civil suit was
Code, Clearly, both Sections 5 and 12 presuppose the existence Malayan. Petitioner’s contention that he has to pay once
founded on the fact that Malayan issued a Marine Open
of a double insurance. The pivotal question that now arises is Malayan is finally adjudged to pay Lepanto because of the very
Policy covering all shipments of copper, gold, and silver
whether there is double insurance in this case such that either nature of a contract of reinsurance and considering that the re-
concentrates in bulk from Poro, San Fernando, La Union to
Section 5 or Section 12 of the SR Policy may be applied. insurer is obliged to pay as may be paid thereon (referring to the
Tacoma, Washington or to other places in the US.
original policies), although this is subject to other stipulations and
 Proir to the incident, Malayan obtained reinsurance abroad
In the present case, while it is true that the Marine Policy and the conditions of the reinsurance contract, is without merit.
through Sedgwick, Collins & Co., Limited, a London
SR Policy were both issued over the same subject matter, i.e.,
insurance brokerage.
goods belonging to Wyeth, and both covered the same peril The general rule in the law of reinsurance is that the re-insurer is
insured against, it is, however, beyond cavil that the said policies  The Memorandum of Insurance issued by Sedgwick to entitled to avail itself of every defense which the re-insured
were issued to two different persons or entities. It is undisputed Malayan listed three groups of underwriters or reinsurers: (Malayan) might urge in an action by the person originally
that Wyeth is the recognized insured of Philippines First under its o Lloyds 62.808%, insured (Lepanto). As to the effect of the clause “to pay as may
Marine Policy, while Reputable is the recognized insured of o Companies (I.L.U.) be paid thereon” contained in petitioner’s re-insurance contract,
Malayan under the SR Policy. The fact that Reputable procured 34.705% Arnould, on the Law of Marine Insurance and Average, states
Malayan’s SR Policy over the goods of Wyeth pursuant merely to o Other companies 2.487%. the rule, this: “It has been decided that this clause does not
the stipulated requirement under its contract of carriage with the  At the top of the list of underwriting members of Lloyds is preclude the reinsurer from insisting upon proper proof that a
latter does not make Reputable a mere agent of Wyeth in Syndicate No. 448, assuming 2.48% of the risk assumed by loss strictly within the terms of the original policy has taken
obtaining the said SR Policy. the reinsurer, which syndicate number petitioner Ivor Robert place. “This clause does not enable the original underwriter to
Dayton Gibson claims to be himself. Petitioner then filed a recover from his reinsurer to an extent beyond the subscription
Therefore, even though the two concerned insurance policies motion to intervene as defendant, which motion was denied of the latter.
were issued over the same goods and cover the same risk, there by the lower court. 6
arises no double insurance since they were issued to two Avon Insurance Vs. CA Gr 97642 Aug. 29, 1997
different persons/entities having distinct insurable interests. ISSUE: WON the lower court committed reversible error in Sections 319-321 Reinsurance brokers
Necessarily, over insurance by double insurance cannot likewise refusing the intervention of the petitioner re-insurer in the suit FACTS: Appealing from the Court of Appeals, petitioners claim
exist. Hence, as correctly ruled by the RTC and CA, neither between lepanto and malayan companies. that the trial court’s jurisdiction does not extend to them, since
Section 5 nor Section 12 of the SR Policy can be applied. they are foreign reinsurance companies that are not doing
5 RULING: No. Petition dismissed. The respondent Judge
business in the Philippines.
Gibson vs. Revilla committed no error of law in denying petitioner’s Motion to
92 SCRA 219, No. L-41432 July 30, 1979 Intervene and neither has he abused his discretion in his denial  Respondent Yupangco Cotton Mills filed a complaint
of petitioner’s Motion for Intervention. We agree with the holding
against several foreign reinsurance companies (among
of the respondent court that since movant Gibson appears to be
 which are petitioners) to collect their alleged percentage country. This is not an instance where the erroneous
liability under contract treaties between the foreign service of summons upon the defendant can be cured by
insurance companies and the international insurance the issuance and service of alias summons, as in the
broker C.J. Boatright, (international broker) acting as absence of showing that petitioners had been doing
agent for respondent Worldwide Surety and Insurance business in the country, they cannot be summoned to
Company. answer for the charges leveled against them.
 Inasmuch as petitioners are not engaged in business in 2) As it is, private respondent has made no allegation or
the Philippines with no offices, places of business or demonstration of the existence of petitioners’ domestic agent,
agents in the Philippines, the reinsurance treaties having but avers simply that they are doing business not only abroad
been entered abroad, service of summons upon motion but, in the Philippines, as well.
of respondent Yupangco, was made upon petitioners  It does not appear at all that the petitioners had
through the Office of the Insurance Commissioner. performed any act which would give the general
 Petitioners, by counsel on special appearance, public the impression that it had been engaging, or
seasonably filed motions to dismiss disputing the intends to engage in its ordinary and usual business
jurisdiction of respondent Court and the extra-territorial undertakings in the country. The reinsurance treaties
service of summons. Respondent Yupangco filed its between the petitioners and Worldwide Surety and
opposition to the motions to dismiss, petitioners filed Insurance were made through an international
their reply, and respondent Yupangco filed its rejoinder. insurance broker, and not through any entity or
In an Order, respondent Court denied the motions to means remotely connected with the Philippines.
dismiss and directed petitioners to file their answer,  Moreover, there is authority to the effect that a
petitioners filed their notice of appeal. reinsurance company is not doing business in a
certain state merely because the property or lives
ISSUE: 1) W/N the petitioners were determined to be "doing which are insured by the original insurer company
business in the Philippines". are located in that state. The reason for this is that a
2) W/N defendant has an agent in the Philippines for summons contract of reinsurance is generally a separate and
to be validly served thereto, even without prior evidence distinct arrangement from the original contract of
advancing such factual allegation. insurance, whose contracted risk is insured in the
reinsurance agreement. Hence, the original insured
RULING: 1) The term ordinarily implies a continuity of has generally no interest in the contract of
commercial dealings and arrangements, and contemplates, to reinsurance.
that extent, the performance of acts or works or the exercise of
the functions normally incident to and in progressive prosecution
of the purpose and object of its organization.
 A single act or transaction made in the Philippines,
however, could qualify a foreign corporation to be doing
business in the Philippines, if such singular act is not
merely incidental or casual, but indicates the foreign
corporation’s intention to do business in the Philippines.
 There is no sufficient basis in the records which would
merit the institution of this collection suit in the
Philippines. More specifically, there is nothing to
substantiate the private respondent’s submission that
the petitioners had engaged in business activities in this