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Based on the outline of Prof. Rodrigo Quimbo
Public Utility • A public utility is a business or service engaged in regularly supplying the public with some commodity or service of public consequence such as electricity, gas, water, transportation, telephone or telegraph service. Apart from statutes which define the public utilities that are within the purview of such statutes, it would be difficult to construct a definition of a public utility which would fit every conceivable case. As its name indicates, however, the term public utility implies a public use and service to the public. (Am. Jur. 2d V. 64, p.549.) (Albano vs Reyes)
Public Service • The term public service includes every person that now or hereafter may operate, manage, or control in the Philippines, for hire or compensation, with general or limited clientele, whether permanent, occasional or accidental, and done for general business purposes, any common carrier, railroad, street railway, traction railway, sub-way motor vehicle, either for freight or passenger, or both with or without fixed route and whatever may be its classification, freight or carrier service or any class, express service, steamboat, or steamship line, pontines, ferries, and water craft, engaged in the transportation of passengers and freight or both, shipyard, marine repairshop, [warehouse], wharf or dock, ice plant, ice refrigeration plant, canal, irrigation system, gas, electric light, heat and power, water supply and power, petroleum, sewerage system, wire or wireless communications system, wire or wireless broadcasting stations and other similar public services: Provided, however, that a person engaged in agriculture, not otherwise a public service, who owns a motor vehicle and uses it personally and/or enters into a special contract whereby said motor vehicle is offered for hire or compensation to a third party or third parties engaged in agriculture, not itself or themselves a public service, for operation by the latter for a limited time and for a specific purpose directly connected with the cultivation of his or their farm, the
TRANSPORTATION AND MARITIME LAW transportation, processing, and marketing of agricultural products of such third party or third parties shall not be considered as operating a public service for the purposes of this Act. Transportation • A contract of transportation is one whereby a certain person or association of persons obligate themselves to transport persons, things, news from one place to another for a fixed price. It is the removal of goods or persons from one place to another.
Certificate of Public Convenience (CPC) • A CPC is any authorization to operate a public service issued by the PSC. A CPC is an authorization issued by the Commission for the operation of public services for which no franchise, either municipal or legislative, is required by law (e.g. auto-trucks and motor vehicles).
Certificate of Public Convenience and Necessity (CPCN) • A CPCN is issued by the PSC to a public service to which any political subdivision has granted a franchise under Act 667 after the PSC has approved the same under Section 16(b). A CPCN is an authorization issued by the PSC for the operation of public services for which a franchise is required by law (e.g. electric, telephone services).
Nature of certificate • It constitutes neither a franchise nor a contract, confers no property rights and is a mere license or privilege, and such privilege is forfeited when the grantee fails to comply with his commitments behind which lies the paramount interest of the public, for public necessity cannot be made to wait, nor sacrificed for private convenience. However, certificates represent property rights to the extent that if the rights which any public utility is exercising pursuant to lawful orders of the PSC has been invaded by another public utility, in appropriate cases actions may be maintained by the complainant public utility. Owners of public utilities have the right to maintain appropriate actions against other public utilities not authorized to operate in competition with the complainant. Certificates are considered as property as used in Civil Procedure as they have material value and are material assets. They are subject to attachment and seizure by legal process, and may be acquired by purchase.
Determination of WON an issuance of a certificate is for public convenience
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1. 2. 3. 4.
financial responsibility of the applicant reliability of the applicant priority of filing the application for a certificate, and priority of operation
Prior operator rule • to carry out the purpose and intent for which the PSC was created the law contemplates that the first licensee will be protected in his investment and will not be subjected to a ruinous competition. It is not therefore the policy of the law for the PSC to issue a CPC to a second operator to cover the same field and in competition with a first operator who is rendering sufficient, adequate and satisfactory service, and who in all things and respects is complying with the rules and regulations of the PSC. Accordingly, a CPC or CPCN ought not to be granted where there is no complaint as to existing rates and the co. in the field is rendering adequate services. regular operators are preferred over irregular operators prior operator is given opportunity to improve service prior operator given opportunity to extend lines basis of rule : to prevent ruinous and wasteful competition in order that the interests of the public would be conserved and preserved; so long as the operator complied with the terms and conditions of the license and the reasonable demands of the public, it is the duty of the PSC to protect rather than to destroy its investment inter se arising from
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Private nature: rights and obligations of parties transactions relating to transportation Contract of Transportation, Defined •
One whereby a certain person or association of persons obligate themselves to transport persons, things or news from one place to another for a fixed price
PARTIES TO THE CONTRACT Shipper
TRANSPORTATION AND MARITIME LAW • One who gives rise to the contract of transportation by agreeing to deliver the things or news to be transported, or to present his own person or those of other or others in the case of transportation of passengers.
Carrier or Conductor • One who binds himself to transport persons, things, or news as the case may be or one employed in or engaged in the business of carrying goods for others for hire. Persons or corporations who undertake to transport or convey goods, property, or persons from one place to another, gratuitously or for hire, and are classified as private or special carriers and common or public carriers.
Regulation of the Transportation Industry The Department of Transportation and Communications • The DOTC shall be the primary policy, planning, programming, coordinating, implementing, regulating, and administrative entity of the Executive Branch of the govt. in the promotion, devt. and regulation of dependable and coordinated networks of transportation and communication systems, as well as in the fast, safe, efficient, and reliable postal, transportation and communication services.
Powers and Functions To accomplish its mandate, the Dept. shall have the ff. powers and functions: (a) formulate and recommend national policies and guidelines for the preparation and implementation of integrated and comprehensive transportation and communications systems at the national, regional and local levels; establish and administer comprehensive and integrated programs for transportation and communications, xxx call on any agency, corp., or organization xxx to participate and assist in the preparation and implementation of such program; assess, review and provide direction to programs of the govt xxx; xxx research and devt.
administer and enforce all laws xxx in the field of transportation and communication;
operation and maintenance of such telecommunication facilities in areas not adequately served by the private sector xxx. such as motor vehicles. fix and/or prescribe charges and/or rates pertinent to the operation of public air and land transportation utility facilities and services xxx. improvement. location. establish and prescribe rules xxx operation and maintenance of a nationwide postal system xxx. operate and maintain a nationwide postal system xxx. devt. establish and prescribe rules xxx issuance of licenses xxx. incidental. establish and prescribe rules xxx inspection and registration of air and land transportation facilities. or proper to its mandate. establish and prescribe rules xxx accreditation of driving schools. etc. establish and prescribe rules xxx enforcement of laws governing transportation xxx. such as motor vehicles. of all infrastructure projects and facilities of the Dept. perform such other powers and functions as it may be prescribed by law. determine.TRANSPORTATION AND MARITIME LAW (e) coordinate with the DPWH in the design. zones and/or areas of operation of particular operator of public land services. or as may be necessary. (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) (p) (q) (r) (s) Air Transportation Office PAGE 5 . or as may be assigned from time to time by the President. rehabilitation. establish and prescribe rules and regulations for identification of routes. establish and prescribe rules xxx for the establishment. and aircrafts. and railways. xxx establish. issue certificates of public convenience for the operation of public land and rail transportation utilities and services. administer and operate the Civil Aviation Training Center xxx. trimobiles. accredit foreign aircraft and manufactures xxx. trimobiles. establish and prescribe rules xxx issuance of CPCs for public land transportation utilities.
as an attached agency The Secretary of Transportation and Communications or his designated representative shall be the Chairman of the Board Sec. 4. The Civil Aeronautics Board shall be composed of the Secretary of Commerce and Industry (now DOTC) as Chairman. require annual. as well as their property. revise. cancel. charges. and jurisdiction and control over. periodical and special reports from any carrier 7. lease. The Civil Aeronautics Administration shall be under the administrative supervision and control of the Dept. suspend. collect or receive for any service in connection with air commerce authorize charters whether domestic or international and special air services or flights approve or disapprove increase of capital. alter. as well as of the receipt and expenditures PAGE 6 . the CAB Administrator. prescribe the forms of any and all accounts. merger. RA 776. issue. records. or acquisition and control between domestic air carriers inquire into the mgmt. of the business of any air carrier 3. amend. Air Force. joint or special rates. facilities. the Board shall have the power to regulate the economic aspect of air transportation. of Tourism to the Dept. modify. in so far as may be necessary for the purpose of carrying out the provisions of this Act. or revoke any temporary operating permit or CPCN fix and determine reasonable individual. and memoranda of the movement of traffic. Powers and Duties of the CAB 1. sale of equipment of an air carrier engaged in air commerce. equipment. of Commerce and Industry (now the DOTC) xxx Civil Aeronautics Board RA 776. purchase. 2. air carriers. 6. and franchise. 5. property rights. consolidation. 25. and 2 others to be appointed by the President xxx Section 10 (A) Except as otherwise provided herein. operating contract. deny.TRANSPORTATION AND MARITIME LAW The Civil Aeronautics Board is hereby transferred from the Dept. or fares which an air carrier may demand. monthly. as amended Section 5. the Commanding Officer of the Phil. and shall have the general supervision and regulation of.
punish for contempt of the Board. issue subpoena and subpoena duces tecum and to summon witnesses to appear in any proceedings of the Board. issue preliminary or permanent injunction xxx. to administer oaths and affirmations. d. (b) Land (i) Land Transportation Office (ii) Land Transportation Franchising and Regulatory Board Powers and functions a. and control of. and memoranda shall be preserved 8. PAGE 7 b. . and the holding of the stock in. suspend or cancel CPCs or permits authorizing the operation of public land transportation services provided by motorized vehicles xxx. other persons engaged in any phase of aeronautics. amend. and collect. require each officer and director of any air carrier to transmit a report describing the shares of stock or other interest held by such air carrier with any person engaged in any phase of aeronautics. promulgate rules and regulations governing proceedings before the Board and the Regional Franchising and Regulatory Office xxx. records. f. prescribe and regulate routes of service. rates and other related charges. relative to the operation of public land transportation services provided by motorized vehicles. j. c. issue. approve and periodically review and adjust reasonable fares. and periodically review and adjust reasonable fees and other related charges for services rendered. determine. prescribe. conduct investigations and hearings of complaints for violation of the public service laws on land transportation and of the Board's rules and regulations xxx. e.TRANSPORTATION AND MARITIME LAW of money and the length of time such accounts. h. actions of the Regional Franchising and Regulatory Office herein created. impose. g. xxx zones or areas of operation of public land transportation services provided by motorized vehicles xxx. to review motu proprio the decisions. fix. i. revise. both direct and indirect xxx.
projects xxx geared toward the promotion and devt. the growth and effective regulation of shipping enterprises. eqpt. formulate. zones and/or areas of operation of particular operators of public water services. issue CPCs for the operation of domestic and overseas water carriers. comfort and convenience to persons and property in their charges as well as the safety of persons and property within their areas of operations. licenses or document necessary or incident thereto. functions: develop and formulate plans. (c) Water (i) Maritime Industry Authority • a. standards of measurements and/or design. policies. f. implement and enforce rules and regulations on land transportation public utilities. perform such other functions and duties as may be provided by law. install and provide in their utilities and in their stations such devices. promulgate. merchant marine xxx. The Maritime Industry Authority is hereby retained and shall have the ff. PAGE 8 . e. including penalties for violations thereof. administer. protection. prescribe and regulate routes. establish. undertake the safety regulatory functions pertaining to vessel construction and operation including the determination or manning levels and issuance of certificates of competency to seamen. agencies and entities xxx. register vessels as well as issue certificates. facilities and operating procedures and techniques as may promote safety. g. bay and river pilots. or proper or incidental to the purposes and objectives of this Executive Order.TRANSPORTATION AND MARITIME LAW k. coordinate and cooperate with other govt. undertake the issuance of licenses to qualified seamen and harbor. and rules and regulations requiring operators of any public land transportation service to equip. m. governing water transportation and the Phil. c. d. l. of the maritime industry. or as may be necessary. enforce laws. prescribe and enforce rules and regulations. b. and for the national security objectives of the country.
issue and register the continuous discharge book of Filipino seamen. offering their services to the public. (3) news 2. for compensation.TRANSPORTATION AND MARITIME LAW h. determine. prescribe charges/rates pertinent to the operation of public water transport utilities xxx. (2) persons. l. As to object (1) things. COMMON CARRIERS Common Carriers • Common carriers are persons. standards and procedures for the efficient and effective discharge of the above functions. or news from one place to another for a fixed price Classification : 1. (2) water. corporations. things. water or air. (3) air Parties to contract of transportation PAGE 9 . As to place of travel: (1) land. Transportation defined • A contract of transportation is one whereby a certain person or association of persons obligate themselves to transport persons. perform such other functions as may now or hereafter be provided by law. k. firms or associations engaged in the business of carrying or transporting passengers or goods or both. establish and prescribe rules and regulations. accredit marine surveyors and maritime enterprises engaged in shipbuilding. i. fix. by land. ship repair xxx. j.
• The party to whom the carrier is to deliver the things being transported. Consignee. to designate the price for the carriage. • One who binds himself to transport persons. on land. or news as the case may be. • The person to be transported. gratuitously or for PAGE 10 . The goods or merchandise transported at sea.TRANSPORTATION AND MARITIME LAW Shipper or Consignor . Carrier or Conductor . property or persons. things. from one place to another. also called freightage.or to designate the goods carried. or on inland streams or lakes. Carriers defined • Persons or corporations who undertake to transport or convey goods. 2. Thus the term is used in 2 senses: 1. one who gives rise to the contract of transportation by agreeing to deliver the things or news to be transported. altered or affected by the mere fact that the obligor avails of other parties to effect the transportation agreed upon. one to whom the carrier may lawfully make delivery in accordance with its contract of carriage (but the shipper and the consignee may be one person) Freight defined • • • • The price or compensation paid for the transportation of goods by a carrier.. at sea. one employed in or engaged in the business of carrying goods for other for hire. The hire paid for the carriage of goods on land from place to place. from port to port. Contracts through transportation agents • A contract of transportation is not changed. or to present his own person or those of other or others in the case of transportation of passengers. as in the case of transportation agents. or inland streams or lakes.
and is therefore not subject to regulation as a common carrier Test for a common carrier 1. He must undertake to carry by the methods by which his business is conducted. and over his established roads. unless it enter into a special agreement to do so a private carrier does not hold itself out as engaged in the business for the public. • PAGE 11 . The true test is whether the given undertaking is a part of the business engaged in by the carrier which he has held out to the general public 2. to all persons who choose to employ him. and not a casual occupation. and common or public carriers Private carriers defined. and must hold himself out as ready to engage in the transportation of goods for persons generally as a business.TRANSPORTATION AND MARITIME LAW hire. no one can be a common carrier unless he has held himself out to the public as a carrier in such a manner as to render him liable to an action if he should refuse to carry for anyone who wished to employ him a common carrier is bound to carry all who offer such goods as it is accustomed to carry and tender reasonable compensation for carrying them a common carrier is a public service and is therefore subject to regulation the private carrier agrees in some special case with some private individual to carry for hire a private carrier is not bound to carry for any reason. He must undertake to carry goods of the kind to which his business is confined. 3. He must be engaged in the business of carrying goods for others as a public employment. 4. • Those who transport or undertake to transport in a particular instance for hire or reward Common carriers vs Private carriers: the common carrier holds himself out in common. as ready to carry for hire. The transportation must be for hire. and are classified as private or special carriers. that is.
• The law requires common carriers to carry for all persons. there must be a right which the law compels the owner to give to the general public. either passengers or property. he holds himself out as ready to engage in the transportation of goods for hire as a public employment and not as a casual occupation. where the discrimination in such goods is reasonable and necessary (substantial grounds) 3. Meaning of Public Use. to do so The common carrier cannot lawfully decline to accept a particular class of goods for carriage to the prejudice of the traffic in those goods. and make the usual stipulation as to baggage are common carriers Characteristics of common carriers: 1. or the number and character of the conveyances used in the employment (the test is therefore the character of the business actually carried on by the carrier. and he undertakes to carry for all persons indifferently.TRANSPORTATION AND MARITIME LAW as his occupation rather than the quantity or extent of the business actually transacted. The true criterion is whether the public may enjoy it by right or only by permission The law prohibits unreasonable discrimination by common carriers . for exactly the same charge for a like or contemporaneous service in the transportation of like kind of traffic PAGE 12 . advertise schedules for routes. so that he is bound to serve all who apply and is liable for refusal. Public use is not synonymous with public interest. airlines engaged in the passenger service on regular schedules on definite routes. Exception : for some sufficient reason. • It is not confined to privileged individuals. 4. who solicit patronage of the traveling public.) • An airplane owner is a common carrier where he undertakes for hire to carry all persons who apply for passage indiscriminately as long as there is room and no legal excuse for refusing. but is open to the indefinite public. without sufficient reason.for the best interests of the public 2. No monopoly is favored .the Commission has the power to say what is a reasonable compensation to the utility and to make reasonable rules and regulations for the convenience of the traveling public and to enforce them Public convenience . The common carrier undertakes to carry for all people indifferently. times of leaving and rates of fare. within the limits of his capacity and the sphere of the business required of him.
or any kind of traffic. reasonable possibility of danger or disaster. 4. then different rates may be charged o Merchandise of like quantity may not be considered alike . • • The true criterion by which to judge the character of the use is whether the public may enjoy it by right or only by permission. all the attendant circumstances which might affect the question of the reasonable necessity for the refusal by the carrier to undertake the transportation of this class of merchandise o The mere fact that the carriage of dynamites may lead to destructive explosions is not sufficient to justify refusal if it can be proven that in the condition in which it is offered for carriage there is no real danger to the carrier nor reasonable ground to fear that the vessel and those on board will be exposed to unnecessary or unreasonable risks 3. As a private carrier. so far as the cost of transportation is concerned. etc. 2. Power of State to Regulate PAGE 13 . or locality. • Exception: When the actual cost of handling and transporting is different. suitability of the vessels of the company for the transportation of such products. a stipulation exempting the owner from liability for the negligence of its agents is not against public policy and is deemed valid. kind and quality may be exactly the same.TRANSPORTATION AND MARITIME LAW under substantially similar circumstances or conditions.the quantity.difference in the charge for handling and transporting may only be made when the difference is based upon actual cost o Determination of justifiable refusal • This involves a consideration of the following-1. The law prohibits common carriers (CC) from subjecting any person. and yet not be alike. resulting from their transportation in the form and under the conditions in which they are offered for carriage. the general nature of the business done by the carrier. to any undue or unreasonable prejudice or discrimination whatsoever. shipments may be alike although composed of different classes of merchandise .
in effect. lightning. • The judiciary ought not to interfere with legislative regulations unless they are so plainly and palpably unreasonable as to make their enforcement equivalent to the taking of property for public use without such compensation as under all circumstances is just both to the owner and to the public. grants to the public an interest in that use. Nature and Basis of Liability • Common carriers. cancel the certificate of public convenience granted to any common carrier that repeatedly fails to comply with his or its duty to observe extraordinary diligence. Common carriers are subject to legislative regulation . or deterioration of the goods. • Such regulations must not have the effect of depriving an owner of his property without due process of law. storm. • The business of a common carrier holds such a peculiar relation to the public interest that there is superinduced upon it the right of public regulation. from the nature of their business and for reasons of public policy. and must submit to be controlled by the public for the common good. one devotes his property to a use in which the public has an interest.TRANSPORTATION AND MARITIME LAW • The Board of Transportation may. or other natural disaster or calamity. Common carriers are responsible for the loss. earthquake. The business of a common carrier is affected with public interest. according to the circumstances of each case. nor of limiting or prescribing irrevocably vested rights or privileges lawfully acquired under a charter or franchise [just compensation. due process of law] When judiciary may interfere with legislative regulation of common carriers. or appropriating private property without just compensation. after due hearing. therefore. nor of confiscating. he. to the extent of the interest he had thus created. on its own motion or on petition of any interested party. are bound to observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported by them. Limitation on power to regulate. • PAGE 14 . When. destruction. unless the same is due to any of the following causes only: (1) Flood.
1734) If the goods are lost. unless they prove that they observed extraordinary diligence . destroyed or deteriorated. 1735) A common carrier is bound to carry the passengers safely as far as human care and foresight can provide. 1755) In case of death of or injuries to passengers. Order or act of competent public authority. Reasons for requiring extra-ordinary diligence . The character of the goods or defects in the packaging or in the containers. (Art. whether international or civil. unless they prove that they observed extraordinary diligence. • The nature of the business of common carriers and the exigencies of public policy demand that they observe extra-ordinary diligence. (Art. (Art. common carriers are presumed to have been at fault or to have acted negligently.TRANSPORTATION AND MARITIME LAW (2) (3) (4) (5) • Act of the public enemy in war. common carriers are presumed to have been at fault or to have acted negligently. The public must of necessity rely on the care and skill of common carrier in the vigilance over the goods and safety of the passengers carriers not applicable to special Rigorous law on common employment as carrier • The laws applicable to COMMON CARRIER are rigorous and should not be extended to a person who has neither expressly assumed that character. using the utmost diligence of very cautious persons. nor by his conduct and from the nature of his business PAGE 15 . (Art. the business of common carrier is impressed with a special public duty and therefore subject to control and regulation by the state. The extra-ordinary diligence required of carriers in the handling of the goods of the shippers and consignees last from the time the cargoes are loaded in the vessels until they are discharged and delivered to the consignees. 1756) • • Extraordinary diligence required of common carriers • The law requires COMMON CARRIER to exercise extra-ordinary diligence which means that they must render service with the greatest skill and utmost foresight. Act or omission of the shipper or owner of the goods. with a due regard for all circumstances.
under the "kabit system. it would be easy for him by collusion with others or otherwise.TRANSPORTATION AND MARITIME LAW justified the belief on the part of the public that he intended to assume it. such owner/operator of record is held in contemplation of law as the employer of the driver. "this is a pernicious system that cannot be too severely condemned. 38 Phil 768 When the facts averred show a contractual undertaking by defendant for the benefit of plaintiff. Proof of the contract and of its nonperformance is sufficient prima facie to warrant recovery. as regards the public and third persons. it constitutes an imposition upon the good faith of the govt." Reason for holding registered owner liable • The law does not relieve the registered owner directly of the responsibility that the law fixes and places upon him as an incident or consequence of registration -. it is not necessary for plaintiff to specify in his pleadings whether the breach of the contract is due to wilful fault or to negligence on the part of the defendant. to escape said responsibility and transfer the same to an indefinite person or to one who possesses no property with which to respond financially for the damage or injury done. Kabit system • One whereby a person who has been granted a certificate of public convenience allows other persons who own vehicles to operate them under such license. or of his servants or agents.where a registered owner allowed to evade responsibility by proving who the supposed transferee or owner is." • Registered owner is primarily and solidarily liable for the damage caused by the vehicle registered in his name. and therefore. in case of an accident. leased or transferred to another person who was. at the time of the accident. and as such is responsible for the consequences incident to its operation. The operator of record continues to be the operator of the vehicle in contemplation of law. and it is alleged that plaintiff has failed or refused to perform the contract. PAGE 16 . for a fee or percentage of the earnings. the registered owner should not be allowed to disprove his ownership to the prejudice of the person injured or to be relieved from responsibility Cangco vs MRR. actually operating the vehicle. Registered owner primarily and solidarily liable with driver. This is contrary to public policy. void and inexistent. even if the said vehicle had already been sold.
. may be sold or leased without infringing the certificate issued to the grantee. being contractual. and that if property covered by the franchise is transferred or leased without this requisite approval. The liability of the carrier is direct and immediate. Isaac vs A. passengers.TRANSPORTATION AND MARITIME LAW The contract of defendant to transport plaintiff carried with it. the duty to carry him in safety and to provide safe means of entering and leaving its trains. Medina vs Cresencia. by implication. or injury to. any transfer or lease thereof should be notified to the PSC so that the latter may take proper safeguards to protect the interest of the public. having due regard for all the circumstances a carrier is presumed to have been at fault or to have acted negligently in case of death of. Plaintiff's action is based on the breach of the carrier's contractual obligation to carry his passengers safely to their destination ( culpa contractual). Co. Since a franchise is personal in nature. it being it duty to prove that it exercised extra-ordinary diligence the carrier is not an insurer against all risks of travel. This extra-ordinary diligence required of common carriers is calculated to protect the passengers from the tragic mishaps that frequently occur in connection with rapid modern transportation. and in contemplation of law. was direct and immediate. (2) (3) (4) PAGE 17 .L. to all the circumstances of each case a carrier is obliged to carry its passenger with the utmost diligence of a very cautious person. and its nonperformance could not be excused by proof that the fault was morally imputable to defendant's servants. Principles as to liability of Common Carrier (1) the liability of a carrier is contractual and arises upon breach of its obligation. using the utmost diligence of very cautious persons. That duty. there is breach if it fails to exert extra-ordinary diligence accdg. in order that a franchise. with due regard for all circumstances. the grantee of record continues to be responsible under the franchise in relation to the PSC and to the public. This high standard of care is imperatively demanded by the preciousness of human life and by the consideration that every person must in every way be safeguarded against all injury. 99 Phil 506 The law requires the approval of the PSC. Ammen Trans. the transfer is not binding against the public or the PSC. 101 Phil 1046 A common carrier is bound to carry the passengers safely as far as human care and foresight can provide. or any privilege pertaining thereto.
TRANSPORTATION AND MARITIME LAW Fores vs Miranda. Laws applicable • In all matters not regulated by this Code. In culpa contractual. A carrier's bad faith is not to be lightly inferred from a mere finding that the contract was breached through negligence of the carrier's employees. The law was designed primarily for the protection of the public interest. even if such breach be due to the negligence of the driver. Phil. (Art. the rights and obligations of common carriers shall be governed by the Code of Commerce and by special laws. The contract of carriage is between the carrier and the passenger. The driver cannot be held jointly liable with the owners of the jeep in case of breach of the contract of carriage. To make the driver jointly liable would make the carrier's liability personal instead of merely vicarious and consequently. 1766) New Civil Code primarily governs common carriers PAGE 18 . and this disputable presumption may only be overcome by evidence that he had observed extra-ordinary diligence or that the death or injury of the passenger was due to a fortuitous event. The distinction between fraud. the victim is entitled to recover only the share which corresponds to the driver. 105 Phil 266 A transfer made without the requisite approval of the PSC is not effective and binding in so far as the responsibility of the grantee under the franchise in relation to the public is concerned. bad faith or malice in the sense of deliberate or wanton wrong doing and negligence (as mere carelessness) is too fundamental in our law to be ignored. the carrier is exclusively responsible therefore to the passenger. It does not arise where a passenger demands responsibility from the carrier to enforce its contractual obligations. Rabbit Bus Lines vs IAC. 189 SCRA 159 The principle of last clear chance would call for application in a suit between the owners and drivers of two colliding vehicles. the presumption is that common carriers acted negligently but not maliciously. the SC held that the jeep made a sudden U-turn which was so abrupt that the other driver did not anticipate the sudden U-turn. Under the law. and in the event of contractual liability. For it would be inequitable to exempt the negligent driver of the jeepney and its owners on the ground that the other driver was likewise guilty of negligence. the carrier is presumed to have been at fault or to have acted negligently. unless contradicted by other evidence. On the presumption that the drivers who bump the rear of another vehicle are guilty and the cause of the accident.
While the liability of a carrier as an insurer is not recognized in this jurisdiction. common carriers are responsible for the loss. destruction or deterioration. carriers given wide discretion in selection and supervision of persons to handle goods • The law requires common carriers to exercise extra-ordinary diligence which means that they must render service with the greatest skill and utmost foresight. To comply with this obligation. NCC) The provisions of the NCC primarily govern contracts of carriage of goods from foreign ports to Philippine ports • • B. a carrier is liable for damages suffered by goods carried if such damages arise from its negligence. Due extraordinary diligence required. as the relation between a carrier and its patrons is of a contractual nature. The extra-ordinary diligence required of common carriers in the handling of the goods of the shipper and the consignees lasts from the time the cargoes are loaded in the vessels until they are discharged and delivered to the consignees. or deterioration of the goods carried by them. 1753.TRANSPORTATION AND MARITIME LAW • The Provisions of the Civil Code [1732-1766] primarily govern common carriers and the provisions of the Code of Commerce [Overland Transportation and Maritime Commerce] and special laws [Carriage of Goods by Sea Act. • • PAGE 19 . The law of the country to which the goods are to be transported shall govern the liability of the common carrier for their loss. Common Carriers 1. common carrier should be afforded the right of having a wide discretion in the selection and supervision of persons who will handle the goods. Salvage Act] have only subsidiary application to common carriers. The carrier is also liable even in those cases where the cause of the loss or damage is unknown. Liability and presumption of negligence Responsibility of common carriers • In general. A failure on the carrier to use extra-ordinary care in carrying goods or passengers safely is a breach of contract and constitutes culpa contractual not culpa aquiliana. This responsibility arises from contract. destruction. (Art.
In the exercise of extra-ordinary diligence required by law. Thus. • • PAGE 20 . but it accepts the goods notwithstanding such condition. the common carrier must give due regard to all circumstances and take all steps necessary to insure the safety of the passengers and the goods given the circumstances. • Duty of carrier to deliver cargo in good condition as when loaded • There is no absolute obligation for a common carrier to accept cargo. The carrier is liable for injury to. A vessel should not accept cargo unless it can be given the type of storage that its character requires.TRANSPORTATION AND MARITIME LAW Air carrier can terminate services of pilot for serious misconduct and drunkenness. and provide reasonable and ordinary inspection and care in and about the transportation of cargo. or apparent upon ordinary observation. it takes the risk of delivering it in good condition as when it was loaded. keep and care for the goods carried and to exercise due care to ascertain and consider the nature of the goods offered for shipment and to use such methods for their care during the voyage as their nature requires. extra-ordinary measures and diligence should be exercised by it for the safety of its passengers and their belongings. carry. A common carrier can terminate an employee whose continued service is inimical to its interests and the safety of the passengers. It should not be accepted unless it can be given the type of storage that its character requires. And if the fact of improper packing is known to the carrier or his servants. Carrier has duty to keep and care for goods carried • It is the duty of the common carrier to properly and carefully handle. or loss of. Where a vessel accepts a cargo for shipment for valuable consideration. cargo resulting from the failure to properly care for and handle the cargo en route. because of its duty of extraordinary diligence • The common carrier can terminate the services of its drivers. pilots and employees for serious misconduct and drunkenness because of its duty of extra-ordinary diligence. for placing of conditions in a bill of lading does not relieve the vessels of obligation to take appropriate care of the cargo. Whenever a passenger dies or is injured the presumption is that the common carrier is at fault notwithstanding the fact that it has exercised due diligence of a good father of a family in the selection and supervision of its employees. and it is required to provide adequate ventilation for the safe carriage of the cargo. it is not relieved of liability for loss or injury resulting therefrom.
1735 (exercise of extra-ordinary diligence required by law) 3. 1734 2. The plaintiff needs only to prove that the goods he transported have been lost. Ynchausti Steamship Co. so that if no explanation is given as to how the injury occurred. skill and diligence of which the human mind can conceive nor such as will free the transportation of passengers from all possible perils. destroyed or deteriorated. was due to accident or some other circumstances inconsistent with its liability. and other safety precautions. common carriers are presumed to have been at fault or to have acted negligently. CC cannot interpose the defense that it exercised due diligence in the selection and supervision of EEs. 1735. It is however the duty of CC to teach their drivers not to overload vehicles. Art. PAGE 21 . It is incumbent upon the carrier to prove that the loss was due to accident or some other circumstance inconsistent with its liability. and of their arrival at the place of destination in bad order. unless they prove that they have observed the extra-ordinary diligence required by law. fault or negligence on the part of the EEs and owners of the CC. Mere proof of delivery of goods in order to a carrier. vs Dexter 41 Phil 289 The mere proof of delivery of goods in good order to a carrier. etc. A common carrier is not an insurer of the safety of the passengers and is not absolutely and at all events to carry them safely and without injury. makes out a prima facie case against the carrier. Natural disaster: The CC is exempt from liability if he proves that the loss or destruction of the merchandise was due to accident and force majeure and not to fraud. destroyed or deteriorated Common carrier must then prove that he has exercised extra-ordinary diligence required by law or that the loss. Art. if the goods are proved to have been lost. • • • Defenses available to common carriers 1. not to exceed safe and legal speed limits. the carrier must be held responsible. and of their arrival at the place of destination in bad order makes out a prima facie case against the common carrier.TRANSPORTATION AND MARITIME LAW Presumption of negligence • Under Art. The liability of the CC arises from breach of the contract of carriage and not from culpa aquiliana. Carrier not insurer • Common carriers are not required to exercise all the care.
or other natural disaster in order that the common carrier may be exempted from liability for the loss. storm. a natural disaster shall not free such carrier from responsibility. in an action for damages. 1740) • Effect of New Civil Code • Transportation of the merchandise "at the risk and venture of the shipper" means that the shipper will suffer losses and deterioration arising from fortuitous event. (Art. It does not mean that the carrier is free from liability for losses and deterioration arising from his negligence or fault. Requisites for defense of natural disaster PAGE 22 . the common carrier must exercise due diligence to prevent or minimize loss before. which is presumed. 1739) If the CC negligently incurs in delay in transporting the goods. However. force majeure. or deterioration of the goods. Shippers who are forced to ship goods in an ocean liner have legal rights. destruction. the burden of proof shifted and it devolves upon the carrier to both allege and prove that the goods were damaged by reason of some act which legally exempts it from liability. the natural disaster must have been the proximate and only cause of the loss. When the goods are delivered on board the ship in good order and condition and the carrier delivers them to the shipper in bad order and condition. (Art.TRANSPORTATION AND MARITIME LAW Mirasol vs Dollar 53 Phil 124 Where it appears that a bill of lading was issued to a shipper containing a clause limiting the carrier's liability. printed in fine letters on the back of the bill of lading. during and after the occurrence of flood. the shipper is not bound by the clause limiting liability and the stipulation is void or against public policy. which the shipper did not sign and of which he was not advised. or inherent nature and defects of the goods. EXEMPTION FROM LIABILITY Natural disaster Act of public enemy Act or omission of shipper Character of goods Order of competent authority Natural disaster • In order that the common carrier may be exempted from responsibility.
TRANSPORTATION AND MARITIME LAW 1. is merely the remote cause. during and after the occurrence of flood. if between the delay or refusal of the common carrier to transport the goods and the loss of the goods due to an act of God there intervened the shipper's negligence.the common carrier must not be in delay. in a wreck due to accident or force majeure must. he shall be responsible for any fortuitous event until he has effected delivery. • Accident due to defects of carrier not caso fortuito • Accidents caused either by defects in the carrier or through the negligence of the carrier is not caso fortuito. If the common carrier does not exercise due diligence in minimizing the loss. In such cases. no negligence on the part of the shipper intervened. thus causing a break in the chain of causation between the act of God which caused their loss and the common carrier's fault. destruction or deterioration of the goods arose out of natural disaster.. as a general rule. If the common carrier incurs in delay.natural disaster must have been the proximate and only cause of the loss The common carrier must exercise due diligence to prevent or minimize the loss before. The passenger or shipper has every right to presume that the carrier is perfectly in good condition and could transport him safely and securely to his destination Tan Chiong San vs Ynchausti & Co. 1740 -. fall upon their respective owners. 1739 -. 3. 841. if the obligor incurs delay. he may yet be held liable notwithstanding the fact that the loss. Code of Commerce) Martini Ltd. Under Art. storm. However. Art. (Art. vs Macondray & Co. except in cases where the wrecking or stranding of the vessel occurred through malice. 39 Phil 934 PAGE 23 . a natural disaster shall not free it from responsibility. 1165 par. the act of God is the proximate cause of the loss and the carrier's delay or refusal to transport the goods. 22 Phil 152 Loss of a ship and of its cargo. or other natural disaster.. carelessness or lack of skill on the part of the captain or because the vessel put to sea is insufficiently repaired and prepared. the shipper is not even entitled to set up the claim of contributory negligence. 3. Art. It is then necessary that it be established that the common carrier was guilty of a willful or negligent act and that between this willful or negligent act and the act of God. 2.
the defendant is absolved. As there is no allegation or proof of negligence on the part of the carrier in protecting the cargo from rain or sea water and as the complaint clearly indicates that the damage was due to it being kept on deck. Art. The exception is made by law and falls within the general principle that no one is responsible for fortuitous events. If he carries the goods on deck without the consent of the shipper and the goods are damaged or lost in consequence of being exposed. the burden of proof is shifted to the shipper. • • • Eastern Shipping Lines vs IAC. in the absence of any allegation or proof of negligence. and such manner of carriage having been consented to by the plaintiff. even if the damage is caused by one of the excepted causes. When the shipper consents to his goods being carried on deck. without which it would not have happened. the burden of proof is on the carrier to show that the damage was due to fortuitous events. It is not permissible for the court. and there is no doubt that by the general maritime law he is bound to secure the cargo safely under deck. It may even be caused by the actual fault or privity of the carrier. losses by dangers of the seas are excepted from the risk which the carrier takes upon himself whether the exception is expressed in contract or not. The carrier is responsible for safe and proper storage of the cargo. the carrier is still responsible if the injury might have been avoided by the exercise of reasonable skill and attention on their part. 1680 which considers fire as an extra-ordinary fortuitous event does not apply since it refers only to leases of rural lands where a reduction of rent is allowed when more than 1/2 of the fruits have been lost due to such event. he takes the risk upon himself. This must be so as it arises almost invariably from some act of man or by human means. But then this general law is subject to the exception that when the inevitable accident is preceded by fault of the carrier. in this case. If goods shipped are found to have been damaged. then he becomes responsible for it. 150 SCRA 463 • Fire may not be considered a natural disaster or calamity. to attribute negligence to the ship's employees in the matter of protecting the goods from rains and storms. PAGE 24 . where the shipper consented to the conditions of carriage. But.TRANSPORTATION AND MARITIME LAW • In every contract of affreightment. It does not fall within the category of an act of God unless caused by lightning or by another natural disaster or calamity. However. the carrier cannot protect himself by showing that they were damaged or lost by the dangers of the sea.
in which case such written claims must be made within 24 hours from delivery. under 1742. etc. Where the officer acts without legal process. Character of goods • Claims for damages must be made at the time the goods are delivered unless the indications of the damage cannot be ascertained from the exterior of the package. If the shipper merely contributed to the loss. etc. destruction or deterioration of the goods. 1. of the goods if the public authority had power to issue the order. Duration of Extraordinary Responsibility • The extraordinary responsibility of the common carrier lasts from the time the goods are unconditionally placed in the possession of. the act of the public enemy must have been the proximate and only cause. during and after the act of the public enemy causing the loss. and received by the carrier for transportation until the same are delivered. destruction or deterioration of the goods. In order for the common carrier to be exempted from liability. • Order or act of competent authority The common carrier is not responsible for the loss. the common carrier cannot be held responsible. the common carrier will be held liable. the common carrier shall still be liable for damages although the damages shall be equitably reduced. and the common carrier must have exercised due diligence to prevent or minimize the loss before. the common carrier must exercise due diligence to forestall or lessen the loss for it to completely escape liability. PAGE 25 . As long as the damage to the goods was due purely to the inherent nature or defect of the goods or of the containers thereof. However.TRANSPORTATION AND MARITIME LAW Acts of public enemy • This defense is not absolute. 2. and the proximate cause is still the negligence of the common carrier. Act or omission of the shipper • The act or omission of the shipper must be the proximate cause of the loss.
1736) • The common carrier's duty to observe extra-ordinary diligence in the vigilance over the goods remains in full force and effect even when they are temporarily unloaded or stored in transit. 1738) Constructive delivery • Notice by the common carrier that the cargo had already arrived. the extra-ordinary responsibility of the common carrier ceases. by the carrier to the consignee. 1738) • When carrier's responsibility begins • The extra-ordinary responsibility of the common carrier begins from the time the goods are delivered to the carrier. (Art. Liability of shipper for delay in obtaining delivery of goods. placing them at the disposal of the shipper or consignee releases the common carrier from extra-ordinary responsibility. Once the goods are delivered. From such moment the consignee or shipper should exercise over the cargo the ordinary control pertinent to ownership (should unload cargo from the common carrier). When carrier's responsibility terminates • The extra-ordinary responsibility of the common carrier is terminated at the time the goods are delivered to the consignee or the person who has a right to receive them (actual or constructive delivery). Otherwise. the extra-ordinary responsibility of the common carrier will not commence. (Art. (Art.TRANSPORTATION AND MARITIME LAW actually or constructively. The delivery to the common carrier must place the goods to be transported unconditionally in the possession of the common carrier and the common carrier must receive them. or to the person who has a right to receive them. demurrage PAGE 26 . unless the shipper or owner has made use of the right of stoppage in transitu. Shipper bound to observe all diligence in obtaining delivery of goods • The shipper is bound to observe all diligence in obtaining delivery of the goods. (Art. 1737) The extra-ordinary liability of the common carrier continues to be operative even during the time the goods are stored in a warehouse of the carrier at the place of destination until the consignee has been advised of the arrival of the goods and has reasonable opportunity thereafter to remove them or otherwise dispose of them.
• Stoppage in transitu. 12 SCRA 213 PAGE 27 . to unload forthwith and take away the cargo from the vehicles. 1738) Liability as a warehouseman (ordinary diligence) arises only when the consignee has been advised of the arrival of the goods and has had reasonable opportunity to remove them or otherwise dispose of them • Cia Maritima vs Insurance Co.TRANSPORTATION AND MARITIME LAW • The shipper is liable for lost earnings occasioned by the unnecessary delay in the use of the vehicles belonging to the carrier. (Art. 1737) Exception: Where the shipper or owner exercises its right of stoppage in transitu. Extra-ordinary responsibility ceases only after the consignee has been advised of the arrival of the goods and has had reasonable opportunity to remove them or otherwise dispose of them. Effect of storage in warehouse of carrier • The extra-ordinary responsibility of the common carrier does not cease notwithstanding the fact that the goods being transported are stored in the warehouse of the common carrier at the place of destination. The common carrier holds the goods in the capacity of an ordinary bailee or warehouseman upon the theory that the exercise of the right of stoppage in transitu terminates the contract of carriage (ordinary diligence is required). of North America. due in turn to the failure of the former. and not yet actually delivered to the latter. • The act by which the unpaid vendor of goods stops their progress and resumes possession of them. This is exercised when the buyer is or becomes insolvent. while they are in the course of transit from him to the purchaser. This is a charge for demurrage (additional service provided by common carrier). (Art. Responsibility of carrier when right exercised • The extra-ordinary responsibility of the common carrier ceases when the goods being transported are temporarily unloaded or stored in transit be reason of the exercise of the right of stoppage in transitu by the unpaid seller. upon receipt of notice of the arrival of the goods at the place of destination. Effect of storing in transit • The temporary unloading or storage of the goods during the time that they are being transported does not interrupt the extra-ordinary responsibility of the common carrier.
Supported by a valuable consideration other than the service rendered by the CC. or deterioration of the goods to a degree less than extra-ordinary diligence shall be valid. it is but fair that it exercise extra-ordinary diligence in protecting them from damage and if loss occurs. Whenever the control and possession of goods passes to the carrier and nothing remains to be done by the shipper. • Agreement Limiting Liability As to diligence required • A stipulation between the common carrier and the shipper or owner limiting the liability of the former for the loss or destruction. This stipulation is not contrary to morals or public policy. provided it be: (1) (2) In writing. The bill of lading is not indispensable to a contract of carriage. This is a situation where the common carrier loses control of the goods because of custom regulations and it is unfair that it be made responsible for any loss or damage during such interregnum. signed by the shipper or owner. While the goods are in its possession. While delivery to the customs authorities is not delivery to the consignee. the parties may however. the law presumes that it was due to its fault or negligence. agree to limit the liability of the carrier considering that the goods have still to go through the inspection of the customs authorities before they are actually turned over to the consignee. It is merely documentary proof of the agreement of the parties. destruction and deterioration of the goods take place while the goods are in the possession of the carrier and not after it has lost control of them. and PAGE 28 . then it can be said with certainty that the relation of shipper and carrier has been established. • Lu Do vs Binamira.TRANSPORTATION AND MARITIME LAW • The test as to whether the relation of shipper and carrier had been established is: Had the control and possession of the goods been completely surrendered by the shipper to the common carrier . BUT this rule applies only when the loss. 101 Phil 120 • The general rule is that common carrier's responsibility to observe extra-ordinary diligence lasts from the time the goods are placed in the possession of the carrier until they are delivered to the consignee.
just and in accordance with public policy. or of a man of ordinary prudence in the vigilance over the movable transported. (Art. ship. (Art. 1751) As to amount liability • A stipulation that the common carrier's liability is limited to the value of the goods appearing in the bill of lading. is dispensed with or diminished. destruction. vehicle. or a part thereof. That the common carrier's liability for acts committed by thieves. unless the shipper or owner declares a greater value. That the common carrier will not be liable for any loss. if it is reasonable and just under the circumstances. That the common carrier shall not be responsible for the acts or omissions of his or its employees. is binding. 1749) A contract fixing the sum that may be recovered by the owner or shipper for the loss. violence or force. (Art. to which the contract refers shall be taken into consideration of the question of whether or not a stipulation limiting the common carrier's liability is reasonable. 1744) Any of the following or similar stipulations shall be considered unreasonable.TRANSPORTATION AND MARITIME LAW (3) • Reasonable. destruction or deterioration of the goods. That the common carrier shall exercise a degree of diligence less than that of a good father of a family. unjust and contrary to public policy: (1) (2) (3) (4) That the goods are transported at the risk of the owner or shipper. That the common carrier is not responsible for the loss. or deterioration of goods on account of the defective condition of the car. or deterioration of the goods is valid. 1750) • PAGE 29 . destruction. or of robbers who do not act with grave or irresistible threat. (Art. just and not contrary to public policy. airplane or other equipment used in the contract of carriage. That the common carrier need not observe any diligence in the custody of the goods. and has been fairly and freely agreed upon. 1745) (5) (6) (7) • The fact that the common carrier has no competitor along the line or route. (Art.
if the shipper makes the choice understandingly and freely. unskillfulness or carelessness of its employees. Such contracts are wanting in the element of voluntary assent. 42 Phil 205 • Three kinds of stipulations have often been made in a bill of lading. A stipulation in the bill of lading limiting the liability of the CC to a specified amount unless the shipper declares a higher value and pays a higher freight is valid and enforceable . Heacock vs Macondray. and names his valuation. The shipper and common carrier are not on equal terms. • • The first and second stipulations are invalid as contrary to public policy. 17 SCRA 606 • Two requisites must be fulfilled in order that the liability of PAL be limited according to the stipulations behind the ticket stub : (1) the PAGE 30 . Third. the lower of them conditioned upon his agreeing to a stipulated valuation of his property in case of loss. Shewaram vs PAL. A common carrier cannot limit its liability for injury or loss where such is caused by its own negligence. one exempting the carrier from any and all liability for loss or damage occasioned by its own negligence. he cannot thereafter recover more than the value which he thus places upon his property. It cannot lawfully stipulate for exemption from liability unless such exemption is just and reasonable and unless the contract is freely and fairly made. 51 Phil 90 • The validity of stipulations limiting the carrier's liability is to be determined by their reasonableness and their conformity to the sound public policy. 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 shipper is entirely at the mercy of the common carrier unless protected by the law. one providing for an unqualified limitation of such liability to an agree valuation. even by the carrier's negligence. Second. o o o First. The third is valid and enforceable. No contractual limitation is reasonable which is subversive of public policy. If a common carrier gives to a shipper the choice of 2 rates.TRANSPORTATION AND MARITIME LAW Ysmael vs Barreto. The rule rests on public policy.
there was no bad faith. 1750) • The fact that the conditions are printed at the back of the ticket stub in letters so small that they are hard to read would not warrant the presumption that plaintiff was aware of those conditions such that he had "fairly and freely agreed" to those conditions. It is what is known as a contract of adhesion wherein one party imposes a ready made form of contract on the other. (Arts. value for his of P 100. there is nothing in the evidence actual value of the goods allegedly lost by petitioner. Also. 91 SCRA 223 • PAL incurred delay in the delivery of petitioner's luggage. Considering that petitioner had failed to declare a higher baggage. 1734. items inside to show the • • PAN AM vs IAC. The rule laid down in Mendoza vs PAL provides that before damages can be awarded for loss of profits on account of delay or • PAGE 31 . A contract limiting liability upon an agree valuation does not offend against the policy of the law forbidding one from contracting against his own negligence. he cannot be permitted a recovery in excess Besides. (Art. it is not entirely prohibited. Such case is squarely applicable in this case. passengers are advised not to place valuable their baggage. he is nevertheless bound by the provision thereof. such provisions have been held to be part of the contract of carriage and valid and binding upon the passenger regardless of the latter's lack of knowledge or assent to the regulation. PAL has admitted that passengers do not sign the ticket. and (2) it has been fairly and freely agreed upon. The liability of PAL was limited to the stipulations printed on the back of the ticket. The SC reversed the CA ruling awarding respondent damages for lost profits. Also the carrier cannot limit his liability for injury or loss of goods shipped when such injury or loss was caused by its own negligence. he gives his consent. 164 SCRA 268 • Pan Am cited Ong Yiu vs CA. While the passenger had not signed the plane ticket. However.00. The one who adheres to the contract is in reality free to reject it entirely. The ruling in Shewaram vs PAL is inapplicable since it was premised on the fact that the conditions printed at the back of the ticket were so small and hard to read.TRANSPORTATION AND MARITIME LAW contract is just and reasonable under the circumstances. 1735) Ong Yiu vs CA. if he adheres.
was expected to be vigilant insofar as his luggage is concerned. if not impossibility. • Kinds of stipulation limiting liability • The following stipulations are often made in a bill of lading bill of lading: PAGE 32 . found in a contract of adhesion. Pan Am vs Rapadas. he cannot avoid the application of the liability limitations.sided nature. Otherwise. Unless the contents are declared. The SC is not saying that passengers are always bound to the stipulated amounts printed on a ticket. Such notice should be sufficient notice showing the applicability of the Warsaw limitations. and which probably would lead to such special loss if he defaulted. In the absence of a showing that Pan Am's attention was called to the special circumstances requiring prompt delivery of the luggage. it will always be the word of a passenger against that of the airline. While contracts of adhesion are not entirely prohibited. damage or destruction to a passenger's luggage. 209 SCRA 67 • There is no dispute that there was a notice appearing on page 2 of the ticket stating that the Warsaw Convention governs in case of death or injury to a passenger or of loss. upon contracting with the airline and receiving the plane ticket. or printed elsewhere but referred to in handouts or forms. neither is blind reliance on them encouraged. it must have appeared that the common carrier had notice at the time of delivery to him of the particular circumstances attending the shipment. The passenger. The Court simply recognizes that the reasons behind stipulations on liability limitations arise from the difficulty. it cannot be held liable for the cancellation of respondent's contracts as it could not have foreseen such an eventuality when it accepted the luggage for transit. If the loss of life or property is caused by the gross negligence or arbitrary acts of the airline or the contents of the lost luggage are proved by satisfactory evidence other than the selfserving declarations of one party. the Court will not hesitate to disregard the fine print in a contract of adhesion. If the passenger fails to adduce evidence to overcome the stipulations.TRANSPORTATION AND MARITIME LAW failure of delivery. the Court does not hesitate to rule out blind adherence to their terms. In the face of facts showing they should be ignored because of their basically one. of establishing with a clear preponderance of evidence the contents of a lost suitcase. the Court is constrained to rule that we have to enforce the contract as it is the only reasonable basis to arrive at a just award.
and not as relieving him from the duty of exercising reasonable skill and care.TRANSPORTATION AND MARITIME LAW 1. such policy has no force where the public at large is not involved] The parties may stipulate that the diligence to be exercised by the common carrier be less than extra-ordinary diligence. • Construction of stipulations limiting common carrier's liability • An exemption in general words not expressly relating to negligence. just and not contrary to public policy. 2. unjust and contrary to public policy. the stipulation must be reasonable. 1745 provides for 7 stipulations which shall be considered unreasonable. the SC held that the Civil Code provisions on CC should not be applied where the common carrier is not acting as such but as a private carrier. 3.. 3. However. provided that the requirements under Article 1744 are complied with. Effect of lack of competitor to common carrier PAGE 33 . 1744) This applies only when the CC is acting as such but not when it acts as a private carrier [in Home Insurance vs American Steamship Co. (Art. Art. • the stipulation must be in writing and signed by both parties.VALID and ENFORCEABLE 2. even though the words are wide enough to include loss by negligence or default of common carrier's servants. must be construed as limiting the liability of the common carrier as assurer. the stipulation must be supported by valuable consideration other than the service rendered by the common carrier. the parties cannot reduce the diligence to less than that of a good father of a family. destruction or deterioration of goods to a degree less than extra-ordinary diligence : 1. When stipulation limiting liability valid • The shipper or owner and the CC may stipulate to limit the liability of the CC for the loss. stipulation exempting the common carrier from any and all liability for loss or damage occasioned by its own negligence – VOID stipulation providing for an unqualified limitation of such liability to an agreed stipulation – VOID stipulation limiting the liability of the common carrier to an agreed valuation unless the shipper declares a higher value and pays a higher rate of freight -.
1747) Presumption as to negligence in case of limited liability The presumption continues even when there is an agreement limiting the liability of the common carrier in the vigilance of the goods. provided that notice was given to them. the delay or change of route must be without just cause] (Art. where the common carrier changes the stipulated or usual route [in both cases. in all matters not regulated by the Civil Code. etc The common carrier cannot avail of the contract limiting his liability in these cases: (1) (2) where the common carrier delays the transportation of the goods. (Art. The common carrier shall be responsible for them as depositaries. just and in consonance with public policy. (Art. The rules concerning the responsibility of hotelkeepers shall be applicable to common carriers. The deposit of effects made by passengers in common carriers shall be regarded as necessary. 1751) Effect of delay in transportation. 1753) The Civil Code governs the liability of the common carrier in case of loss. Under 1766. or to PAGE 34 . • Rules on Passenger Baggage • • • Common carriers are bound to observe extraordinary diligence in the vigilance over the goods of the passengers transported by them. the rights and obligations of the common carier shall be governed by the Code of Commerce and by special laws which are suppletory to the provisions of the Civil Code. 1752) Applicable Law in foreign trade • The law of the country to which the goods are to be transported shall govern the liability of the common carrier for their loss. damage or deterioration.TRANSPORTATION AND MARITIME LAW The lack of competition of the common carrier shall be considered in determining WON a stipulation limiting common carrier's liability is reasonable. (Art. destruction or deterioration. This presumption is disputable or rebuttable by evidence that the common carrier exercised extra-ordinary diligence.
who has entered the common carrier is not deemed force majeure. • • Classes of baggage of passengers • and (2) baggage not in such custody but in that of the common carrier. Any stipulation between the common carrier and the passenger where the responsibility of the former is suppressed or diminished shall be void. Responsibility for acts of employees. of the baggage brought by their passengers. The law makes a distinction between (1) baggage in the custody of the passengers or their employees. PAGE 35 . The common carrier shall be responsible for such baggage as depositaries. • The act of a thief or robber. they take the precautions which said common carriers or their employees advised relative to the care and vigilance of their effects. The common carrier cannot free himself from responsibility by posting notices to the effect that he is not liable for the articles brought by the passenger. Liability for baggage in custody of passenger • The baggage of passengers in their personal custody or in that of their EEs while being transported shall be regarded as necessary deposits. or if the loss arises from the character of the things brought into the common carrier. and that the passengers take the precautions which said CCs advised relative to the care and vigilance of their baggage.TRANSPORTATION AND MARITIME LAW their employees. caused by the common carrier's servants or employees but not those caused by force majeure. The common carrier is not liable for compensation if the loss is due to the acts of the passenger. thieves • A common carrier is responsible as a depositary for the loss of or injury to the baggage in the personal custody of passengers. unless it is done with the use of arms or through irresistible force. on the part of the latter. of the effects brought by the passengers and that. provided that (1) (2) notice was given to them or to their EEs.
from the nature of their business and for reasons of public policy. are bound to observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported by them. his family. unless it is done with the use of arms or through irresistible force. PAGE 36 . As the common carrier has custody of such baggage and are carried like any other goods. if it accepted them for transportation • • Common Carrier of Passengers Nature and extent of responsibility Art. 1733. servants or visitors. The moment the effects of a passenger are unconditionally placed in the possession of and received by a carrier for conveyance.TRANSPORTATION AND MARITIME LAW • The act of a thief or robber. A common carrier is liable for the loss of baggage although not declared and the charges not paid. according to the circumstances of each case. who has entered the common carrier's vehicle is not deemed force majeure. • Stipulations limiting liability • A common carrier cannot free himself from responsibility by posting notices to the effect that he is not liable for the baggage brought by the passengers. Liability for baggage not in custody of passenger • This refers to baggage delivered to the custody of the common carrier and received by him. Any stipulation diminishing the responsibility required under 1998 to 2001 shall be void. OR if the loss arises from the character of the baggage. the law immediately imposes on the common carrier extraordinary responsibility for the loss thereof which lasts until the actual or constructive delivery of the effects to the passenger as the person who has the right to receive them (presumption of negligence exists but may be rebutted by proof of exercise of extraordinary diligence or causes under 1734). Common carriers. to be carried in the same manner as other goods being transported by him. the provisions on carriage of goods shall apply (extraordinary diligence in the vigilance over the goods). The common carrier is not liable if the loss of the baggage in the personal custody of the passenger is due to the acts of the passengers.
from the breach of that contract by reason of the failure of defendant to exercise due care in its performance. It is not negligence per se for a traveler to alight from a slowly moving train. with a due regard for all circumstances. 1755) Common carriers must exercise extraordinary diligence in carrying passengers • Art. lapse or neglect thereof will certainly result to the damage. Its liability is direct and immediate ( culpa contractual). Nos. Cangco vs MRR. and that the obligation to respond for the damage which plaintiff has suffered arises. • A common carrier is bound to carry the passengers safely as far as human care and foresight can provide. which can be rebutted by proof of the exercise of due care in the selection and supervision of employees (culpa aquiliana). Carrier's duty of extraordinary diligence extends also to crew members • The duty to exercise the utmost diligence on the part of common carrier is for the safety of passengers as well as for the members of the crew or the complement operating the carrier. (Art. while the extraordinary diligence for the safety of the passengers is further set forth in Articles 1755 and 1756. using the utmost diligence of very cautious persons. injuries or even death to all aboard the plane. when such act or omissions cause damage which amount to the breach of a contract. It also failed to provide adequate lighting for its station. The foundation of the legal liability of the defendant is the contract of carriage. MRR failed to exercise due care in not providing for safe exit of its passengers. This must be so for any omission. differing essentially.TRANSPORTATION AND MARITIME LAW Such extraordinary diligence in the vigilance over the goods is further expressed in Articles 1734. prejudice. 6. 5. is not based upon a mere presumption of the master's negligence in their selection • PAGE 37 . 1735. 38 Phil 768 • • • • The conduct of plaintiff in undertaking to alight while the train was yet slightly underway was not characterized by imprudence and that he was not guilty of contributory negligence. from that presumptive responsibility for the negligence of its servants. The liability of masters and employers for the negligent acts or omissions of their servants or agents. 1755 shows clearly the high degree of care and extraordinary diligence required of a common carrier with respect to its passengers. if at all. and 7. and 1745.
1762). Passengers necessarily should take upon the usual and ordinary perils to airplane travel. being contractual. That duty.L. Proof of the contract and of its nonperformance is sufficient prima facie to warrant recovery. By placing his left arm on the window. was direct and immediate. the duty to carry him in safety and to provide safe means of entering and leaving its trains. • • Isaac vs A. Co. inevitable accident is defined as one that is not occasioned in any degree remotely or directly by want of such skill or care as the law holds for what man is bound to exercise . 101 Phil 1046 • If the carrier's employee is confronted with a sudden emergency. the passenger is guilty of contributory negligence. this is a circumstance which militates against plaintiff's position. or of his servants or agents. A carrier is not liable for defects of ignition cables used on his plane. 40 OG 269 • In aviation. nor of the installation thereof. and although contributory negligence cannot relieve the carrier but can only reduce his liability (Art. • PAGE 38 .TRANSPORTATION AND MARITIME LAW or control. by implication. The contract of defendant to transport plaintiff carried with it. A carrier is not an insurer against all risks . • Strong vs Iloilo-Negros Air Express. It is negligence per se for passengers to protrude any part of his body and that no recovery can be had for an injury. The doctrine of res ipsa loquitor cannot be applied when there is no proof that according to the general experience of mankind. and its nonperformance could not be excused by proof that the fault was morally imputable to defendant's servants. it is not necessary for plaintiff to specify in his pleadings whether the breach of the contract is due to willful fault or to negligence on the part of the defendant. Airplane companies are not required to exercise all the care. Ammen Trans. he is not held to the same degree of care he would otherwise be required in the absence of such emergency.. and proof of exercise of the utmost diligence and care in this regard does not relieve the master of his liability for the breach of his contract. which cables were purchased from a competent and reputable manufacturer in the absence of a showing that it knew those defects or that such kind of ignition cable is not ordinarily used on the airplane operated by it. the accident was such that it does not usually occur in the ordinary course of events without the negligence on the part of those in control. When the facts averred show a contractual undertaking by defendant for the benefit of plaintiff. and it is alleged that plaintiff has failed or refused to perform the contract.
33 SCRA 284 Held : In Lasam vs Smith. circuitous and ascending road. The bus was heavily laden. When the passenger dies or is injured. passengers. This extraordinary diligence required of common carriers is calculated to protect the passengers from the tragic mishaps that frequently occur in connection with rapid modern transportation. or injury to. to all the circumstances of each case (2) A carrier is obliged to carry its passenger with the utmost diligence of a very cautious person. with due regard for all circumstances. The rationale is that the passenger has neither the choice nor control over the carrier in the selection and use of the equipment and appliances in use by the carrier . It is true that defendant being a CC is bound to transport its passengers from the point of origin to the place of destination. using the utmost diligence of very cautious persons. and it would be traversing mountainous. but the duty PAGE 39 . 1755. Landicho vs BTC. it being its duty to prove that it exercised extraordinary diligence (4) The carrier is not an insurer against all risks of travel Landingin vs Pantranco. Thus the entire bus would naturally be taxed more heavily than it would be under the ordinary circumstances. there is breach if it fails to exert extraordinary diligence accdg.TRANSPORTATION AND MARITIME LAW • A common carrier is bound to carry the passengers safely as far as human care and foresight can provide. The mere fact that the bus was inspected only recently and found to be in order would not exempt carrier from liability unless it is shown that the particular circumstances under which the bus would travel were also considered. This high standard of care is imperatively demanded by the preciousness of human life and by the consideration that every person must in every way be safeguarded against all injury. 52 OG 764 Held : The facts show that the cage was not about to fall. This is only rebutted by proof on the carrier's part that it observed extraordinary diligence required in Art. It does not appear that the carrier gave due regard for all the circumstances with cross joints' inspection the day previous to the accident. 1733 and the utmost diligence of very cautious persons required in Art. the court held that accidents caused by defects in the automobile are not caso fortuito. Principles as to liability of common carrier (1) The liability of a carrier is contractual and arises upon breach of its obligation. having due regard for all the circumstances (3) A carrier is presumed to have been at fault or to have acted negligently in case of death of. Plaintiff was probably dizzy or sleepy that he fell from the truck. the presumption is that the CC is at fault or acted negligently.
the defect could have been detected with the exercise of utmost diligence by the CC. 17 SCRA 739 Held: Whether or not the relation between carrier and passenger does not cease at the moment the passenger alights from the carrier's premises is to be determined from the circumstances. The driver stopped the bus but did not turn off the engine. The presence of passengers near the bus was not unreasonable and the duration of the responsibility still exists. He started to run the bus even before the conductor gave him the signal. 105 Phil 75 Held : While the carrier is not an insurer of the safety of the passengers. 2. there was no utmost diligence. for then the co.TRANSPORTATION AND MARITIME LAW does not encompass all the risks attendant to a passenger in transit.-. Having no privity whatever with the manufacturer or vendor of the defective eqpt. It is enough for the CC's EEs to see to it that the passenger places himself safely inside the vehicle. for that is the lookout of the passenger himself. The liability of the CC rests upon negligence or his failure to exercise the utmost degree of diligence that the law requires. the passenger has no remedy against him. Duration of responsibility 4 Agbayani: When relationship of carrier and passenger terminates. it should nevertheless be held answerable for the flaws of its equipment if such flaws were discoverable. What is a reasonable time or a reasonable delay within this rule is to be determined from all the circumstances La Mallorca vs CA. In this case. but continues until the passenger had reasonable time or a reasonable opportunity to leave the CC's premises. In this case. A passenger must see to it that he seats himself in a safe portion of the vehicle. paying the fare and intentionally falling off.The relation of CC and passenger does not cease at the moment that the passenger alights from the CC's vehicle at a place selected by the CC at the point of destination. It would be unreasonable to exact upon operators to determine beforehand whether a passenger is likely to fall dizzy or sleepy on the way. PAGE 40 . and appliances in use by the carrier . The rationale of CC's liability for manufacturing defects is the fact that the passenger has neither choice nor control over the carrier in the selection and use of the eqpt. Necesito vs Paras. would be a good source of stipend for a family who would like to end it all by simply boarding. that it is operated carefully and that its mechanism is perfectly alright to prevent mishaps.
TRANSPORTATION AND MARITIME LAW Bataclan vs Medina, 102 Phil 181 Held: The proximate cause of the death was the overturning of the vehicle which was followed by the negligence of the driver and the conductor who were on the road walking back and forth. They should have known that with the position of the bus, leakage was possible aside from the fact that gas when spilled can be smelled from a distance. The failure of the driver and conductor to have cautioned or taken steps to warn rescuers not to bring a lighted torch too near the bus constitutes negligence on the part of the agents of the carrier. Aboitiz vs CA 179 SCRA 95 Held: Aboitiz is still liable for his death under the contract of carriage. The relation of carrier and passenger continues until the passenger has been landed at the port of destination and has left the vessel owner's dock. Once created the relationship will not ordinarily terminate until the passenger has safely alighted from the carrier's conveyance or had reasonable opportunity to leave the carrier's premises . All persons who remain on the premises a reasonable time after leaving the conveyance are to be deemed passengers and what is reasonable time is to be determined from all circumstances and includes a reasonable time to see after his baggage and prepare for his departure. The CC-passenger relationship is not terminated merely by the fact that the person transported has been carried to his destination if the person remains in the premises to claim his baggage. The test is the existence of a reasonable cause as will justify the presence of the passenger near the vessel. A CC is bound to carry its passengers as far as human care and foresight can provide, using the utmost diligence of a very cautious person with due regard for all circumstances. PAL vs CA, G.R. 82619, Sept. 1993 Held: The passenger's complaint touched on PAL's indifference and inattention to his predicament and not on PAL's refusal to comply with his demand for priority over the other passengers. He claimed that he was exposed to the peril of Muslim rebels and that he suffered mental anguish, mental torture, social humiliation, besmirched reputation and wounded feeling. He referred to PAL's apathy. The contract of air carriage is a peculiar one. Being imbued with public interest, the law requires common carriers to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with due regard for all the circumstances. In Air France vs Carrascoso, the SC held that the contract to transport passengers is quite different from any contractual relation in that it invites people to avail of the comforts and advantages it offers. The diversion of the flight was due to a fortuitous event. However, such did not terminate PAL's
TRANSPORTATION AND MARITIME LAW contract with its passengers. Being in the business of air carriage, PAL is deemed equipped to deal with situations like the case at bar. The relation of carrier and passenger continues until the latter has been landed at the port of destination and has left the CC's premises. Hence, PAL necessarily would still have to exercise extraordinary diligence in safeguarding the comfort, convenience and safety of the stranded passengers until they have reached their final destination. PAL was therefore remiss in its duty of extending utmost care to Zapatos while being stranded in Cotabato City. The CA held : "While the failure of Zapatos to reach his destination xxx in accordance with the contract of carriage was due to the closure of the airport on account of rain and inclement weather xxx it becomes the duty of PAL to provide all means of comfort and convenience to its passengers when they would have to be left in a strange place in case of such by-passing. If the cause of non-fulfillment of the contract is due to a fortuitous event, it has to be the sole and only cause. Since part of the failure to comply with the obligation to deliver its passengers safely to their destination lay in PAL's failure to provide comfort and convenience to its stranded passengers using extraordinary diligence, the cause of non-fulfillment is not solely and exclusively due to fortuitous event, but due to something that PAL could have prevented, PAL becomes liable to the passenger." However the SC found that although PAL was remiss in its duty of extending utmost care to Zapatos while being stranded in Cotabato City, there was no sufficient basis to conclude that PAL failed to inform him about his other options. 3. Presumption of negligence Art. 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in articles 1733 and 1755. 4 Agbayani: Presumption of negligence.-- CCs are presumed to have been at fault or to have acted negligently in case of death or injuries to passengers. This disputable presumption may only be overcome by superior evidence that he had observed extraordinary diligence prescribed in 1733, 1755, 1756 Where death or injury results to the passenger because of the negligence of the CC's Es, the CC is liable, notwithstanding the fact that he had exercised all the diligence of a good father of a family, in the selection and supervision of his EEs xxx Consequently, in an action for damages, the issue is not WON the party seeking damages has adduced sufficient evidence to show the negligence of the CC but WON the carrier has presented the required quantum of proof to overcome the presumption that it has been at fault or that it acted negligently in the performance of its duty. In the exercise of extraordinary diligence, the CC must give due regard for all circumstances in connection with the transport of passengers
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How presumption of negligence overcome.-To overcome such presumption, it must be shown that the CC had observed the required extraordinary diligence or that the accident was caused by fortuituos event. In order to constitute caso fortuito that would exempt a person from responsibility, it is necessary that : 1. The event must be independent of human will; 2. The occurrence must render it impossible for the obligor to fulfill his obligation in a normal manner; 3. The obligor must be free of a concurrent or contributory fault or negligence. [Estrada vs Consolacion, 71 SCRA 523] Carrier not precluded from proving negligence of other carrier involved in collision.-- While the plaintiff-passenger does not need to prove the negligence of the CC, he may not preclude the CC from proving the legal defense of negligence of the other vehicle involved in the collision (the CC may file a third-party complaint against the other vehicle for reimbursement) "Last clear chance" rule not applicable to contracts of carriage.-The principle of last clear chance applies only in a suit between the owners and drivers of two colliding vehicles; it does not apply where a passenger demands responsibility from the CC to enforce its contractual obligation; it would be iniquitous to exempt the driver and his ER on the ground that the other driver was also negligent Court need not make express finding of carrier's fault or negligence.-- The court need not make an express finding of fault or negligence on the part of the CC in order to hold it responsible to pay the damages sought by the passenger. By the contract of carriage, the CC assumes the express obligation to observe extraordinary diligence in transporting the passenger This is an exception to general rule that negligence must be proved. Carriers not ordinarily liable for injuries to passengers due to fires or explosions caused by articles brought into conveyance by other passengers.-- CC is not ordinarily liable for injuries to passengers due to fires or explosions caused by articles brought into conveyance by other passengers. Fairness demands that in measuring the CC's duty towards its passengers, allowance should be given to the reliance that should be reposed on the sense of responsibility of all the passengers in regard to their common safety (that the passenger will not take with him anything dangerous to his co-passengers.) For the carrier to be liable, he must be aware, through his EEs of the nature of the article or must have had some reason to anticipate danger therefrom (circumstances must show that there are causes for apprehension that the passenger's baggage is dangerous and that the CC fails to act in the fact of such evidence) [Nocum vs Laguna Bus Co., 1969] 4. Force Majeure
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Bachelor Express vs CA 188 SCRA 217 Held : The CC is liable for the death of the passengers. Bachelor Express as a CC is bound to carry its passengers safely as far as human care and foresight can provide using the utmost diligence of very cautious person, with due regard for all the circumstances. In this case where passengers suffered injuries which caused their death, under 1756, the CC is presumed to have acted negligently unless it can prove that it had observed extraordinary diligence. The CC raised the defense of caso fortuito. Art. 1174 provides that no person shall be responsible for those events which could not be foreseen or which though foreseen were inevitable. In Lasam vs Smith, the SC held that a caso fortuito must have the following elements: (1) The cause of the unforeseen and unexpected occurrence must be independent of the human will ; (2) It must be impossible to foresee the event; (3) The occurrence must be so as to render it impossible for the debtor to fulfill his obligation in a normal manner ; and (4) The obligor must be free from any participation in the aggravation of the injury resulting to the creditor. The running amuck of the passenger was the proximate cause of the incident and is within the context of force majeure. However, in order that a CC may be absolved from liability in case of force majeure, it is not enough that the accident was caused by force majeure. The CC must still prove that it was not negligent in causing the injuries resulting from such accident. It must prove that there was no negligence or lack of care and diligence on the part of the CC. The TC and the CA had conflicting findings of fact. The SC upheld the findings of the CA-- the driver did not immediately stop the bus at the height of the commotion; the bus was speeding from a full stop; the victims fell from the bus door when it was opened or gave way while the bus was still running; the conductor panicked and blew his whistle after people had already fallen off the bus; the bus was not properly equipped with doors in accordance with law. It is therefore clear that the petitioners have failed to overcome the presumption of fault and negligence found in the law governing CCs. The CC's argument that it is not an insurer of its passengers deserves no merit in view of the failure of the CC to prove that the deaths of the 2 passengers were exclusively due to force majeure and not to the failure of the CC to observe extra-ordinary diligence in transporting safely the passengers to their destinations as warranted by law. 5. Limitation of liability; validity of stipulations Art. 1757. The responsibility of the common carrier for the safety of passengers as required in Arts. 1733 and 1755 cannot be dispensed with or lessened by stipulation, by the posting of notices, by statements on tickets, or otherwise.
signed by the parties. supported by sufficient consideration. charges. Such provisions are part of the contract of carriage. The one who adheres to the contract is in reality free to reject it entirely.TRANSPORTATION AND MARITIME LAW Art. Ticket given to a passenger is a written contract. if he adheres.-. he is nevertheless bound by the provisions thereof. elements: (1) the consent of the contracting parties manifested by the fact that the passenger boards the ship and the shipper consents or accepts him in the ship for transportation. (3) object. (3) by statements on tickets. (2) cause or consideration which is the fare paid by the passenger as stated in the ticket. where the CC incurred delay. which is the transportation of the passenger from the place of departure to the place of destination which are stated in the ticket. (2) by the posting of notices. (2) lessening the extraordinary diligence required by law to the diligence of a good father of a family Exception: Effect of gratuitous carriage. a stipulation limiting the common carrier's liability for negligence is valid. Passenger bound notwithstanding his failure to sign ticket containing stipulation limiting liability.Even if the passenger failed to sign the ticket. it is liable only for the amount printed in the ticket the passenger not having declared a higher value for his luggage nor paid addtl.Under 1758. he gives his consent. The law is much stricter with respect to carriage of passengers as compared with carriage of goods: a stipulation limiting the CC's liability in writing. 1758. or (4) otherwise What cannot be stipulated in a carriage of passengers : (1) absolutely exempting the CC from liability from the passenger's death or injuries. Accordingly.Ticket given to passenger is a written contract with the ff. regardless of the passenger's lack of knowledge or assent to the regulation. not contrary to law will still be void where the passenger is not carried gratuitously. the CC and the passenger may validly stipulate limiting the CC's liability for negligence where the passenger is carried gratuitously (but the parties cannot stipulate to entirely eliminate liability of CC) Effect of reduction of fares. the reduction of fare does not justify any limitation of the CC's liability -the law requires gratuitous passage.-. When a passenger is carried gratuitously.-. the extraordinary diligence required under 1733 and 1755 for the carriage of passengers cannot be dispensed with or lessened (1) by stipulation. Dispensing with or limiting liability. It is what is known as a contract of adhesion which is not entirely prohibited by law. The reduction of fare does not justify any limitation of the common carrier's liability. PAGE 45 .-.-Under 1758 (2). but not for willful acts or gross negligence.General rule: Under 1757.
Common carriers are liable for the death of or injuries to passengers through the negligence or willful acts of the former's employees. he violates the contractual obligation of the CC for which he represents the CC PAGE 46 .[Lara vs Valencia. CC are held liable for the death or injuries to passengers caused by the negligence or the willful acts of their EEs. 4 Agbayani: Liability for negligence or willful acts of employees. the same obligation of care is imposed upon the driver and owner as in the case of one expressly invited to ride 6. although such EEs may have acted beyond the scope of their authority or in violation of the orders of the CC. Art. 4. 1760. 1043 (1957): (1) extraordinary diligence required of CC: calculated to protect the passengers as demanded by the preciousness of human life and by the consideration that every person must in every way be safeguarded against all injury.TRANSPORTATION AND MARITIME LAW Liability of owner of CC to accommodation passengers or invited guests. p. or otherwise. The common carrier's responsibility prescribed in the preceding article cannot be eliminated or limited by stipulation. The liability of the common carrier does not cease upon proof that they exercised all the diligence of a good father of a family in the selection and supervision of their employees. since one riding in an automobile is no less a guest because he asked for the privilege of doing so. 1958] an owner of an automobile owes a guest the duty to exercise ordinary or reasonable care to avoid injuring him. 54 OG no. 1759. by statements on the tickets. Responsibility for acts of EEs Art.-. when the EE mistreats the passenger. (2) liability for injury of passenger is based on a breach of contract of carriage for failure to bring the passenger safely to his destination Reason for making the CC liable for the misconduct of its EEs in their own interest. by the posting of notices.-. although such employees may have acted beyond the scope of their authority or in violation of the orders of the common carrier. The CC cannot escape liability by interposing the defense that its EEs have acted without any authority or against the orders of the CC The passenger is entitled to protection from personal violence by the CC or its agents or EEs since the contract of transportation obligates the CC to transport a passenger safely to his destination and a CC is responsible for the misconduct of its EEs Cardenas vs Fernando.-.The servant is clothed with delegated authority and charged with the duty by the CC. to execute his undertaking to carry the passenger safely.Under 1759.
97 Phil 884 PAGE 47 .The relation of CC and passenger does not cease at the moment that the passenger alights from the CC's vehicle at a place selected by the CC at the point of destination. the driver. The proximate cause of the death was the overturning of the vehicle which was followed by the negligence of the driver and the conductor who were on the road walking back and forth. They should have known that with the position of the bus.TRANSPORTATION AND MARITIME LAW Liability of CC for defects of its equipment. (3) by statements on the tickets. but continues until the passenger had reasonable time or a reasonable opportunity to leave the CC's premises. the bus was speeding. the EE is deemed as a stranger or co-passenger since his act was not done in the line of duty Defense of diligence in selection.Under 1760. of employees.A passenger is entitled to recover damages from a CC for an injury resulting from a defect in an appliance purchased from a manufacturer. the CC's liability for the negligence or willful acts of his EEs which cause death of or injury to passengers cannot be eliminated or limited by (1) stipulation. 104 Phil 181 Held : There was a breach of the contract of carriage and negligence on the part of the agent of the CC. leakage was possible aside from the fact that gas when spilled can be smelled from a distance. the manufacturer is considered as being in law the agent or servant of the CC.-.-.-The CC is exempt from liability where the EE was never in a position in which it became his duty to his ER to represent him in discharging any duty of the CC towards the passenger. At the time of the blowout of the tires. etc. What is a reasonable time or a reasonable delay within this rule is to be determined from all the circumstances Elimination or limitation of carrier's liability. as far as regards the work of constructing the appliance Common carrier is exempt from acts of EE not done in line of duty. De Gillaco vs MRR.CC cannot escape liability by interposing defense that he exercised due diligence in the selection and supervision of his EEs.-. whenever it appears that the defect would have been discovered by the CC if it had exercised the degree of care which under the circumstances was incumbent upon it.-. or (4) otherwise Bataclan vs Medina. for the purposes of this doctrine. (2) by the posting of notice. with regard to inspection and application of the necessary tests. his liability is based on culpa contractual When relationship of carrier and passenger terminates.. The failure of the driver and conductor to have cautioned or taken steps to warn rescuers not to bring a lighted torch too near the bus constitutes negligence on the part of the agents of the carrier.
The act of the guard was entirely unforeseeable by MRR which had no means to ascertain or anticipate that the two would meet nor could it foresee every personal rancor that might exist between its EEs and its passengers. and social attitude. 7. Under respondeat superior (w/c is the minority view). A common carrier is responsible for injuries suffered by a passenger on account of the willful acts or negligence of other passengers or of strangers. and from its own servants charged with the passenger's safety. 1754). The OCC did not impose upon CC the absolute liability for assaults of their EEs upon the passengers. both being unforeseeable and inevitable under the circumstances. The CC's liability is absolute in the sense that it practically secures the passengers from assaults committed by its own EEs. When the crime took place. Responsibility for acts of strangers and co-passengers Art. the CC is liable only when the act of the EE is within the scope of his authority and duty. His position would be that of a passenger also waiting transportation and not of an EE assigned to discharge duties. PAGE 48 . The CC's liability is based on either (1) respondeat superior or (2) the CC's implied duty to transport the passenger safely. other passengers. the CC is liable as long as the assault occurs within the course of the performance of the EE's duty. Under the second view. the guard had no duties to discharge. including patterns of behavior. 20 SCRA 412 Held: The NCC unlike the OCC makes the CC absolutely liable for intentional assaults committed by its EEs upon its passengers (Art. Three cogent reasons underlie this rule : (1) the special undertaking of the CC requires that it furnish the passengers the full measure of protection afforded by the exercise of the high degree of care prescribed in the law. The shooting was a caso fortuito. It is the CC's obligation to select its drivers with due regard not only to their technical competence and physical ability but also to their total personality. Maranan vs Perez. (2) liability is based on the CC's confiding in the servant's hands the performance of his contract to safely transport the passenger. It is no defense that the act was done in excess of authority or in disobedience of the CC's orders. the CC must bear the risk of wrongful acts or negligence of the CC's EEs against passengers since it has the power to select and remove them. moral fiber. 1763. delegating therewith the duty of protecting the passenger with utmost care prescribed by law.TRANSPORTATION AND MARITIME LAW Held : While a passenger is entitled to protection from personal violence by the CC or its agents or EEs. from violence and insults in the hands of strangers. (3) as between the CC and the passenger. if the common carrier's employees through the exercise of the diligence of a good father of a family could have prevented or stopped the act or omission. the responsibility of the CC extends only to those acts that the CC could foresee or avoid through the exercise of the degree of care and diligence required of it.
) Pilapil vs CA 180 SCRA 546 Held: The law does not make the CC an insurer of the absolute safety of its passengers.TRANSPORTATION AND MARITIME LAW 4 Agbayani: The CC is responsible for such willful acts or negligence of other passengers or of strangers. provided that the CC's EEs could have prevented or stopped the act or omission through the exercise of ordinary diligence. COMMERCIAL LAW REVIEWER. it is not enough that the accident was caused by force majeure. over which the carrier had no control or even knowledge of. The presumption created by law against the CC is rebuttable by proof that the CC had exercised extraordinary diligence in the performance of its obligations and that the injuries suffered were caused by fortuitous events. 1755 qualifies the duty of the CC in exercising vigilance to only such as human care and foresight can provide. Art. with regards to its liability in cases when intervening acts of strangers directly caused the injury. However. Under Art. The running amuck of the passenger was the proximate cause of the incident and is within the context of force majeure. The CC would only be negligent if the tort caused by a third person could have been foreseen and prevented by them. The rule is not so exacting as to require one charged with its exercise to take doubtful or unreasonable precautions to guard against unlawful acts of strangers. 1763. Agbayani. It must prove that there was no negligence or lack of care and diligence on the part of the CC. is the diligence only of a good father of a family and not the extraordinary diligence generally required. the CC is not liable Notice that the law speaks of injuries suffered by the passenger but not his death. The injury was in no way connected to the performance of the obligation of the bus company. the diligence required. The word "injuries" should be interpreted to include "death. or its failure to exercise the degree of diligence required by law. the victims fell PAGE 49 . It was caused by a stranger. If the injury could not have been avoided by the exercise of ordinary diligence on the part of the EEs of the CC. The TC and the CA had conflicting findings of fact. and which could not have been prevented. The SC upheld the findings of the CA-. The CC must still prove that it was not negligent in causing the injuries resulting from such accident. there appears to be no reason why the common carrier should not be held liable under such circumstances. However." (Aguedo F. Bachelor Express vs CA. The liability of the CC necessarily rests upon its negligence.the driver did not immediately stop the bus at the height of the commotion. 180 SCRA 217 Held: The CC raised the defense of caso fortuito. in order that a CC may be absolved from liability in case of force majeure. 1988 ed. the bus was speeding from a full stop.
TRANSPORTATION AND MARITIME LAW from the bus door when it was opened or gave way while the bus was still running.Diligence of a good father of a family to avoid injury to himself. The passenger must observe the diligence of a good father of a family to avoid injury to himself. The circumstances show that it was no means so risky for him to get off while the train was yet moving. 8. the CC is exempted from liability Effect of passenger's contributory negligence. Law does not protect negligence of passenger. the conductor panicked and blew his whistle after people had already fallen off the bus. but the amount of damages shall be equitably reduced. PAGE 50 . if the proximate cause thereof is the negligence of the common carrier. effect of contributory negligence Art. It is therefore clear that the petitioners have failed to overcome the presumption of fault and negligence found in the law governing CCs. Art.-Contributory negligence on the part of the passenger does not justify the CC's exemption from liability. The contributory negligence of the passenger does not bar recovery of damages for his death or injuries. and not that of the CC. It is not negligence per se for a traveler to alight from a slowly moving train. he or his heirs are not barred from recovery of damages. 1762. Where it is not the proximate cause of the death or injury.-.-. 1761.-. provided of course that the CC is the proximate cause of his death or injury Cangco vs MRR 38 Phil 768 Held: The conduct of plaintiff in undertaking to alight while the train was yet slightly underway was not characterized by imprudence and that he was not guilty of contributory negligence.Where the proximate cause of the death of or injury to the passenger is his own negligence. The CC's argument that it is not an insurer of its passengers deserves no merit in view of the failure of the CC to prove that the deaths of the 2 passengers were exclusively due to force majeure and not to the failure of the CC to observe extraordinary diligence in transporting safely the passengers to their destinations as warranted by law. the bus was not properly equipped with doors in accordance with law. Duty of passenger.Law does not protect negligence of passenger to the extent of doing harm or damage upon a public utility Diligence required of passenger. Effect of negligence of passenger.
in case of a landing outside an airport. or. D. The carrier shall be liable for damages occasioned by delay in the transportation by air of passengers. (3) The period of the transportation by air shall not extend to any transportation by land. or of damage to. Art. for the purpose of loading. by sea. 1929) Art. 12. delivery. Liability of air carrier under the Warsaw Convention (Oct.TRANSPORTATION AND MARITIME LAW Isaac vs A. any checked baggage or any goods. In this case. if the accident which caused the damage so sustained took place on board the aircraft or in the course of any of the operations of embarking or disembarking. the passenger is guilty of contributory negligence. or transshipment. 19. if the occurrence which caused the damage so sustained took place during the transportation by air. baggage or goods SC has held that these provisions merely declare the carrier liable for damages in the enumerated cases. In general PAGE 51 . The injury was due to passenger's fault. such transportation takes place in the performance of a contract for transportation by air. If however. The carrier shall be liable for damages sustained in the event of death or wounding of a passenger or any other bodily injury suffered by a passenger. 18. or by river performed outside an airport. Art. Ammen Held: By placing his left arm on the window. the bus driver had done what a prudent man could have done to avoid the collision. if the conditions therein specified are present. 17. (2) The transportation by air within the meaning of the preceding paragraph shall comprise the period during which the baggage or goods are in the charge of the carrier. 1762). (1) The carrier shall be liable for damage sustained in the event of the destruction or loss of. L. whether in an airport or on board an aircraft. this is a circumstance which militates against plaintiff's position. to have been the result of an event which took place during the transportation by air. It is negligence per se for passengers to protrude any part of his body and that no recovery can be had for an injury. and although contributory negligence cannot relieve the carrier but can only reduce his liability (Art. subject to proof to the contrary. any damage is presumed. in any place whatsoever. Damages Recoverable from Common Carriers 1. Neither said provisions nor others in the Convention regulate or exclude liability for other breaches of contract by the carrier.
unless the deceased on account of permanent physical disability not caused by the defendant. Actual or compensatory Art. (6) Exemplary or corrective. Art. Art. 2. Except as provided by law or by stipulation. 1764. (5) Liquidated. (4) Temperate or moderate. bad faith. 2201. the recipient who is not an heir called PAGE 52 . malice or wanton attitude. Damages may be: (1) Actual or compensatory. Art. (2) Moral. The party suffering loss or injury must exercise diligence of a good father of a family to minimize the damages resulting from the act or omission in question. one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. In case of fraud. 1764.TRANSPORTATION AND MARITIME LAW Art.000 (now P50. 2203. the obligor shall be responsible for all damages which may be reasonably attributed to the non-performance of the obligation. (2) If the deceased was obliged to give support according to the provisions of article 291. 2206. and which the parties have foreseen or could have reasonably foreseen at the time the obligation was constituted. Art. Article 2206 shall also apply to the death of a passenger caused by the breach of contract by a common carrier. the damages for which the obligor who acted in good faith is liable shall be those that are natural and probable consequences of the breach of the obligation. In addition: (1) The defendant shall be liable for the loss of the earning capacity of the deceased. 2199.000). 2197. even though there may have been mitigating circumstances. such indemnity shall in every case be assessed and awarded by the court. Damages in cases comprised in this Section shall be awarded with the title XVIII of this book concerning damages. Such compensation referred to as actual or compensatory damages. The amount of damages for death caused by a crime or quasi-delict shall be at least P 3. Damages in cases comprised in this Section shall be awarded with the title XVIII of this book concerning damages. (3) Nominal. and the indemnity shall be paid to the heirs of the latter. In contracts and quasi-contracts. Art. had no earning capacity at the time of his death. Article 2206 shall also apply to the death of a passenger caused by the breach of contract by a common carrier.
which were heard even by the bus passengers. In addition. Dr. The claim for moral damages could not be granted because Art. 2220 because it did not act PAGE 53 . He sounded the train's whistle four times before the intersection. may demand support from the person causing the death. 2201. On the other hand. to LTBC witness. legitimate and illegitimate descendants and ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased. (3) The spouses. it would cause his death. it is sufficient to justify the assumption that he could have finished his course and would have passed the board exams in due time. it is liable for damages that are the natural and probable consequences of the breach and which the parties had foreseen or could have reasonably foreseen at the time the obligation was constituted. the exact duration to be fixed by the court. at the crossing heeded the train whistle by stopping and allowing the train to pass. While his scholastic record may not be first rate.75. MRR cannot be held to be contributorily negligent because LTBC was not able to discharge its burden of proof when it alleged that MRR violated its charter by failing to ring the locomotive bell. had been rendered physically and mentally invalid by the accident. had he finished his studies. The evidence shows that Ed C. As regards the income that he could possibly earn as a doctor. another LTBC bus which arrived ahead of the bus in this case. the bus driver was negligent in totally disregarding the warning. and LTBC. Compensatory damages should be increased to P 25. he has to lead a quiet and retired life because if the tantalum plate which replaced a portion of his skull is pressed in or dented. for a period not exceeding five years. He suffered head injuries specifically a fractured right forehead necessitating the removal of all the right frontal lobe of his brain.TRANSPORTATION AND MARITIME LAW to the decedent's inheritance by the law of testate or intestate succession. and other expenses in the total sum of P 17. Neither could LTBC be liable under Art. which reduced his intelligence by 50% so that he can no longer finish his medical course. The SC ruled that the income which Ed could earn if he should finish the medical course.. (2) thereof because this case is not one of quasi-delict and could not be considered as such because of a pre-existing contractual relation between Ed C. The bus did not slow down but instead the bus driver tried to pass the intersection before the train.719. Cariaga vs LTBCo. Doria) could easily be expected as minimum monthly income of Ed C. It however claims that the said provision contemplates only the medical. 2219 enumerates the instances when moral damages may be recovered and the present case does not fall under any of them. Clearly. hospital. In addition. 110 Phil 346 Held: The train driver was not negligent. P 300 (accdg. and pass the corresponding board exams must be deemed included because they could have reasonably been foreseen by the parties at the time he boarded the bus. LTBC admitted that under Art.000. even par.
Pan Am contends that its liability for the lost baggage of Pangan is limited to $ 600. The SC applied the ruling in Mendoza vs PAL: Before defendant could be held to special damages. and were not themselves injured as a result of the collision. it must have appeared that he had notice at the time of delivery to him of the particular circumstances attending the shipment. of years on the basis of which damages shall be computed (life expectancy). 2208. Pan Am was not privy to the contracts of Pangan nor was its attention called to the condition therein requiring delivery of the promotional and advertising materials on or before a certain date. In the absence of proof that Pan Am's attention was called to the special circumstances requiring prompt delivery of Pangan's luggages. The bus co. petitioner cannot be held liable for the cancellation of Pangan's contracts as it could not have reasonably foreseen such eventuality when it accepted the luggage for transit.00 ($20 x 30 kilos) as the latter did not declare a higher value for his baggage and pay the corresponding charges. The claim by the parents for actual and compensatory damages is also without merit because the present action is based upon a breach of contract of carriage and the parents were not a party thereto. and which probably would lead to such special loss if he defaulted. such as alleged loss of profits on account of delay or failure of delivery. 164 SCRA 268 Held: On the basis of stipulations printed at the back of the ticket. In fact. Pan Am vs IAC. No attorney's fees could be awarded since there was no unjustified refusal by Pan Am to satisfy the passenger's just and valid claim. such unusual or extraordinary damages must have been brought within the contemplation of the parties as the probable result of the breach at the time of or prior to contracting. Villa Rey Transit vs CA. CA determined life expectancy accdg. arising from a breach of contract. Attorney's fees could also not be granted because this case does not fall under Art.e. in the ordinary course of things.TRANSPORTATION AND MARITIME LAW fraudulently or in bad faith. i.30] = 33 1/3 years. and since Quintos was around 30 years old at the time of his death : 2/3 x [80 . In order to impose on the defaulting party further liability than for damages naturally and directly. and (2) rate at which the losses sustained should be fixed. 31 SCRA 511 Held: The determination of damages due is dependent on 2 factors : (1) on the no. wanted to use the 4 year basis adopted in Alcantara vs Surro but the court held that the case is not controlling as it did not lay down any rule on the length of time to be used in the computation of damages. it declared that there is no fixed basis for determination of indemnity and much is left to the discretion of the court considering the material damages involved and that there can be no exact or uniform rule for measuring the value of human life and the PAGE 54 . to the American Expectancy Table of Mortality.
wounded feelings.95 for the amount actually spent by the sisters for his medical and burial expenses and P 2. when he would be promoted and receive a higher salary. 2216. Though incapable of pecuniary computation.000 pursuant to Art. Moral damages include physical suffering. social humiliation. Multiplying his annual net income by his life expectancy of 30 years. mental anguish. 104 and 107 of the RPC.900. The assessment of such damages. Art. PAL vs CA. To this sum must be added P12. besmirched reputation. Moral Art. 500 attorney's fees. 2217. upon conclusion of his training. 3. except PAGE 55 . the product is P 417. 185 SCRA 110 Held: Under Arts. The amount recoverable would therefore be the NET earnings. No proof of pecuniary loss is necessary in order that moral. nominal. Villa Rey impugns the decision on the ground that damages will have to be paid NOW where most of those sought to be indemnified will be suffered years later. In fixing said amount. fright. 1764 and Article 2206 (1).100 less P 9. In determining the losses sustained by the dependents and heirs of Quintos. fixed at the rate of P 2. the lower courts determined the deceased gross annual income to be P 23. This argument if offset by the fact that payment of the award will take place upon the finality of the decision. which is the death indemnity due to his mother and only forced heir. NCC and P 1. Because of the long delay in this case. moral damages may be recovered if they are the proximate result of the defendant's wrongful act or omission. they consist NOT of the full amount of his earnings but of the support they would have received from him had he not died. liquidated or exemplary damages may be adjudicated. in relation to Art.184 per year and did not anymore compute the potentiality and capacity of Quintos to increase his future income.200 as living expenses. which is the portion which the beneficiaries would have received. temperate. 2206.000. the award of damages for death is computed on the basis of the life expectancy of the deceased and not of the beneficiary. and similar injury. The lower court allowed the deceased a life expectancy of 30 years.TRANSPORTATION AND MARITIME LAW measure of damages cannot be arrived at by precise mathematical calculations. PAL is ordered to pay her heirs the death indemnity with legal rate of interest of 6% per annum. the mother already died without being able to receive the indemnity she deserved. serious anxiety. resulting in a net income of P 13. the necessary living expenses should therefore be deducted from his earnings.727. In this case. moral shock.
as required by Art. 2220. but such would depend upon the availability of first class seats. xxx (3) The spouses. 2220. The exception is a mishap resulting to the death of a passenger in which case Art. under the circumstances. Moral damages may be recovered in the following analogous cases : (1) A criminal offense resulting in physical injuries. 2206. 1764 makes the CC subject to Art. and constitute unwarranted legislation. legitimate and illegitimate descendants and ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased. 18 SCRA 155 Held: Air France contended that the issuance of the first class ticket was no guarantee that he would have a first class ride. 30. 27. 34 and 35. To award moral damages for breach of contract. 2206 (award of moral damages). is left to the discretion of the court. It received the corresponding amount in payment of first-class tickets and yet it allowed the passenger to be at the PAGE 56 . 29. 1764 makes it all the more evident that where the injured passenger does not die. 26.TRANSPORTATION AND MARITIME LAW liquidated ones. xxx (10) Acts and actions referred to in Articles 21. 2219. Air France vs Carrascoso. without proof of bad faith or malice on the part of the CC. 32. there is no other evidence of such malice to support an award of moral damages. The same rule applies to breaches of contract where the defendant acted fraudulently or in bad faith. moral damages are not recoverable unless it is proved that the CC was guilty of malice or bad faith. 28. xxx Art. A CC's bad faith is not to be lightly inferred from a mere finding that the contract was breached through negligence of the CC's EEs. Willful injury to property may be a legal ground for awarding moral damages if the court should find that. (2) Quasi-delicts causing physical injuries. In the case at bar. according to the circumstances of each case. The SC ruled that it could not understand how a reputable firm like Air France could have the indiscretion to give out tickets it never meant to honor at all. would be to violate the clear provisions of the law. such damages are justly due. Art. Fores vs Miranda 105 Phil 266 Held: Art. Art.
Plaintiffs are entitled to moral damages. It is true that the complaint did not use the term Bad Faith. the CC-ER must answer.TRANSPORTATION AND MARITIME LAW mercy of its EEs. 16 SCRA 431 Held: In so misleading the plaintiffs into purchasing first class tickets in conviction that they had confirmed reservations when in fact they had none. political. defendant willfully and knowingly placed itself into position of having breached its contract with plaintiffs.000 as attorney's fees considering the standing of plaintiff's counsel. he imposed his arbitrary will. Said contract was breached when the CC failed to furnish the first class transportation at Bangkok. But the interference of BF is there. wounded feelings. It may not be humiliating to travel as tourist passengers. 64 SCRA 610 Held: It is the opinion of the SC that moral damages should be raised from P 100. For bad faith means a breach of a known duty through some motive of interest of ill will. Plaintiff was indeed confirmed for first class all the way to Rome. There was contract to furnish plaintiff a first class passage. worse. resulting in moral damages. The manager not only prevented Carrascoso from enjoying his right to a first class seat. All the same. Third. Damages are proper.000 and exemplary damages be increased from P 30. The expulsion of Carrascoso is a violation of a public duty by the CC -. he forcibly ejected him from his seat. made him suffer the humiliation of having to go to the tourist class compartment -. Moral damages are recoverable. Such actions of the defendant may indeed have been prompted by nothing more than the promotion of its self-interest in holding on to plaintiffs as passengers and foreclosing on their chances to seek the service of other airlines that may have been able to afford to them first class accommodations. they are awarded P 200. This is certainly BF. The manner of ejectment of Carrascoso fits into the legal precept for awarding exemplary damages in addition to moral damages.000 to P 150.000 as moral damages. such conduct already amounts to action in BF. embarrassments and humiliation. P 75. For the willful malevolent act of CC's manager. contrary to what is rightfully to be expected from the contractual undertaking. thereby causing him mental anguish. there was bad faith when petitioner's EE compelled Carrascoso to leave his first class accommodation after he was already seated and to take a seat in the tourist class by reason of which he suffered inconvenience. Considering their official. in legal contemplation. but it is humiliating to be compelled to travel as such. serious anxiety. and P 50. and social humiliation.000 as exemplary damages all with interest.000 to PAGE 57 . Ortigas vs Lufthansa. CC's contract with Carrascoso is attended with public duty.a case of quasi-delict. social and financial standing. Lopez vs Pan Am.just to give way to another passenger whose right thereto has not been established.
2233. reckless. There can be no excuse for them not to realize that with such maneuvers. Since both Alitalia and Lufthansa are members of IATA and are agents of each other. the SC ruled that the action which was based on quasi-delict should be appropriately regarded as grounded on contract. Also taken into consideration was the heart condition of Ortigas which gave him added apprehension about traveling economy against the advice of the doctor. In contracts and quasi contracts. The question is WON the defendants were recklessly or grossly negligent. 2220. The award of higher damages is justified by the aggravation of the situation when the Lufthansa EE at Rome falsely noted on Ortigas' ticket that he was traveling economy from Rome to HK and which was repeated four times. Exemplary Art. Exemplary damages cannot be recovered as a matter of right. Art. Art. In this case. They executed maneuvers inadequately and too late. 1764) and exemplary damages if the defendants acted recklessly or with gross negligence (Art. As found by the CFI. There is no question that the defendants are negligent. DJ steered to the right while TC continued its course to the left. fraudulent. The SC ruled in the affirmative. inattention and lack of care on the part of the CC resulting in the failure of the passenger to be accommodated in the class contracted for amounts to bad faith or fraud which entitles the passenger to an award of moral damages in accordance with Art. they are bound by the mistakes committed by a member such as the mistake of the Alitalia EE to inform Ortigas that he could travel first class instead of only being waitlisted. the court will decide whether or not they should be adjudicated. by way of example or correction for the public good. Its liability would include moral damages (Art.TRANSPORTATION AND MARITIME LAW P 100. and indulged in the presumption of negligence on the part of the CC although its EEs may have acted beyond the scope of their authority or even in violation of its instructions. to avoid collision. PAGE 58 . oppressive. the breach appears to be of graver nature. 2332). temperate. liquidated or compensatory damages. or malevolent manner. in addition to the moral. 180 SCRA 83 Held: Before going into the issue. the court may award exemplary damages if the defendant acted in a wanton. Exemplary or corrective damages are imposed. since the preference given to the Belgian passenger over plaintiff was done willfully and in wanton disregard of plaintiff's rights and his dignity as a human being and as a Filipino. 4. It is our considered view that when it comes to contracts of common carriage. Mecenas vs CA. they will collide. 2229. 2232.000. who may not be discriminated against with impunity.
004 passengers and crewmembers). be proved with certainty. which are more than nominal but less than compensatory damages. upon seeing TC turn to its left.000. 2224.000 following the doctrine that the SC must consider and resolve all issues which must be decided in order to render substantial justice to the parties. and not for the purpose of indemnifying the plaintiff for any loss suffered by him. WON he was then off-duty is immaterial. Liquidated damages are those agreed upon by the parties to a contract. may be vindicated or recognized. there is.000 and P 60. to compel CC to control their EEs. Temperate and Liquidated Art. 2221.000 and attorney's fees of P 15. the SC ruled that it is not applicable and will not relieve DJ from responsibility if the collision could have been avoided by proper care and skill on her part or even by a departure from the rules. or in failing to discover and correct the regularity of the captain's mahjong sessions while DJ was at sea. The SC awarded moral damages of P 307. the SC increased it to P 800. As for Negros Aviation. 2226. in the case. in permitting. 1733 and 1755 cannot be PAGE 59 . 1757. both realistically speaking and in contemplation of law. Art. to be paid in case of breach thereof.000 for a total of P 815. no such thing as off-duty hours for the master of a vessel at sea that is a CC upon whom the law imposes the duty of extraordinary diligence. which has been violated or invaded by the defendant. he was playing mahjong before and up to the time of the collision. to tame their reckless instincts. the captain failed to supervise his crew in the process of abandoning the ship and he failed to avail of measures to prevent the too rapid sinking of his vessel. the SC looks to it as an instrument to serve the ends of law and public policy by reshaping socially deleterious behaviors.TRANSPORTATION AND MARITIME LAW As for the captain. Temperate or moderate damages. 5. including issues not explicitly raised by the parties affected. Art. may be recovered when the court finds that some pecuniary loss has been suffered but its amount cannot. As for the failure of TC to follow R18 by turning right instead of left. from the nature of the case. Art. it still turned to its right resulting in the collision. The responsibility of a common carrier for the safety of passengers as required in Arts. and to force them to take adequate care of human beings and their property. DJ is still at fault when.000 award of damages granted by the CFI.000 together with actual and compensatory damages for wrongful death of P 126. Nominal. When the collision occurred. thus aggravating the casualties. it must be deemed grossly negligent.000 and exemplary damages of P 307. Although the petitioners only asked for P 400. It also sailed with an overload (1. In discussing the rule of exemplary damages in law. specifically. Nominal damages are adjudicated in order that a right of the plaintiff.
no bad faith or otherwise improper conduct may be ascribed to the EEs of Alitalia. an air carrier is made liable for damages for: (1) The death. if the occurrence causing it took place during the carriage by air. luggage or goods. however. and (3) Delay in the transportation by air of passengers. The compensation for the injury suffered by Dr. or otherwise. The opportunity to claim honor or distinction for herself. where there was satisfactory evidence of malice or bad faith attributable to its officers and employees. The Convention also limits the liability of the carriers for each passenger to 250. or as not restrictive of the carrier's liability. which gradually turned into panic and despair. when she learned that her suitcases were missing. to comply with a contract of carriage.000 francs and for registered baggage and cargo to 250 francs per kg unless the passenger has declared a higher rate and has paid additional charges.with the result that she was unable to read her paper that she had painstakingly labored over. or as an absolute limit of the extent of that liability. recklessness. that some special species of injury was caused to her because Alitalia misplaced her baggage and failed to deliver it to her at the time appointed -. loss or damage to property or delay in its transport is not attributable to or attended by any wilful misconduct. The Convention does not regulate or exclude liability for other breaches of contract by the carrier. nevertheless. In the case at bar. any registered luggage or goods. Such proposition is not borne out by the language of the Convention. was irretrievably lost to her. if the damage is caused by his wilful misconduct or by such default on his part as is considered to be equivalent to wilful misconduct or if the damage is similarly caused by any agent of the carrier acting within the scope of his employment. bad faith. She also underwent profound distress and anxiety. or loss of damage to. The Convention does not thus operate as an exclusive enumeration of the instances of an airline's liability. 192 SCRA 10 Held: Under the Warsaw Convention. but without appreciable damage. or destruction. Pablo cannot under the circumstances be restricted to that prescribed by the Warsaw Convention for delay in the transport of baggage. Dr.a breach of its contract of carriage -. denies to the carrier availment of the provisions which exclude or limit his liability. (2) The destruction. Pablo's luggage was eventually returned belatedly. Alitalia vs IAC. or otherwise improper conduct.TRANSPORTATION AND MARITIME LAW dispensed with or lessened by stipulation. in bad faith. She is not entitled to be compensated for loss or damage to her luggage since they were ultimately delivered to her. by the posting of notices. for UP and for the country. The Warsaw Convention. an air carrier would be exempt from any liability for damages in the event of its absolute refusal. The Warsaw Convention has invariably been held inapplicable. The Convention should be deemed a liability only in those cases where the cause of the death or injury to person. wounding or other bodily injury of a passenger if the accident causing it took place on board the aircraft or in the course of its operations of embarking or disembarking. by statements on tickets. The fact is. PAGE 60 . Otherwise.
or one day after private respondents received the cargo. However. the airway bill was issued. or where the court deems it just and equitable. 1976. The extraordinary responsibility of CC begins from the time the goods are delivered to the carrier. on the terms specified in such instrument. and not for the purpose of indemnifying the plaintiff for any loss suffered. SC: An airway bill estops the carrier from denying receipt of goods.000 for attorney's fees is reasonable. From said date. for immediate shipment. unless the shipper exercises the right of stoppage in transitu . there must in fact have been delivery of the cargo subject of the contract of carriage. Pablo's right being violated. Petitioners relied on the doctrine that the issuance of the bill of lading carries the presumption that the goods were delivered to the carrier issuing the bill. 26. 27.TRANSPORTATION AND MARITIME LAW She is however entitled to nominal damages. when no goods have been delivered for shipment no recitals in the bill can estop the carrier from showing the true facts. which has been violated or invaded by the defendant. 26. private respondents were charged with the responsibility to exercise extraordinary diligence so much so that for the alleged switching of the caskets on Oct. For such duty to commence. This responsibility remains in force even when they are temporarily unloaded or stored in transit. Only when such fact PAGE 61 . A bill of lading is a receipt as to the quantity and description of the goods shipped and a contract to transport the goods to the consignee or other person therein designated. Saludo vs CA 207 SCRA 498 Held: (1) Petitioners allege that private respondents received the casketed remains of petitioner's mother on Oct. and terminates ony after the lapse of a reasonable time for the acceptance of the goods by the consignee or other person entitled to receive them. which is adjudicated in order that a right of the plaintiff. despite the issuance of the airway bill and the date thereof. It was not until Oct. the latter must necessarily be liable. The law authorizes recovery of attorney's fees where the defendant's act or omission has compelled the plaintiff to litigate with third person or to incur expenses to protect his interest. they deny having received the remains of Saludo on Oct. 1976. why. 1976. The award of P 5. As to the argument that she failed to include a specific claim for nominal damages in her complaint. A bill of lading is a written acknowledgment of the receipt of the goods and an agreement to transport and deliver them at a specified place to a person named or on his order. it suffices that her general prayer includes "such other and further just and equitable relief in the premises. 1976 as evidenced by the issuance of the PAL Airway Bill. As found by the CA. may be vindicated and recognized. 28 that PAL received physical delivery of the body at SF. as between the shipper and the carrier. and it is nowhere questioned that a bill of lading is prima facie evidence of the receipt of the goods by the carrier. and with proof of Dr. not as evidence of receipt of delivery but merely as confirmation for the booking made for the SF-Manila flight scheduled on October 27." Also absent any claim for actual or compensatory damages (she asked for moral and exemplary damages and attorney's fees). the issue of nominal damages is raised. We must therefore allow the airline companies to explain.
Consequently. (2) Petitioners allege that even assuming CMAS was at fault. It was hired to handle all the necessary shipping arrangements for the transportation of the remains. PAL's agent and TWA had no way of determining its actual contents. it made itself a party to the contract of carriage nad was therefore bound by the airway bill. CMAS was not an agent of private respondents. The consequent duty to conduct an inspection arises in the event that there should be reason to doubt the veracity of such representations. In this case. which is regarded as the agent of the shipper (Pomierski) and not of the crrier. PAL cannot be held liable. and that a carrier has no obligation to inquire into the correctness or sufficiency of such information. But the court cannot rule on the possible liability of CMAS as such is not at issue in this case and there has not been convincing evidence on the matter. 28. SC: This contention is without merit. so that even if CMAS was indeed at fault. They had no authority to unseal and open the casket. even the petitioners wrote CMAS entertaining serious doubts as to whether they were responsible for the mix-up. In fact. since the casket was hermetically sealed by the Philippine Vice-Consul. Air Care Intl. PAL would still be liable because whoever brought the cargo to the airport or loaded it on the plane did so as agent of PAL. CMAS may be classified as a forwarder. (3) Petitioners contended that TWA by agreeing to transport the remains. As found by the CA. They had to rely on the information given by CMAS. the body was really received by PAL on Oct. No amount of inspection by the airlines could have guarded against the switching that had taken place. private respondents had no reason to doubt the truth of the shipper's representations. 1976 and it was from such date that it became responsible for the agreed cargo under the airway bill. for the switching of caskets prior thereto which was not caused by them and subsequent events caused thereby. The airway bill was issued on the basis of such representations. It can safely be said that a CC is entitled to fair representation of the nature and value of the goods to be carried. When the cargo was received from CMAS. When TWA shipped the remains ten hours earlier than PAGE 62 . with the concomitant right to rely thereon. the liability would be attributed to the airlines. In the absence of more definite information. of extraordinary responsibility arise. It is the right of the carrier to require good faith on the part of those persons who deliver goods to be carried by it. The facts of the case would point to CMAS as the culprit. the carrier has the right to accept shipper's marks as to the contents of the package offered for transportation and is not bound to inquire particularly about them. It merely contracts for the transportation of goods by carriers and has no interest in the freight but receives compensation from the shipper as his agent. Neither can they be held accountable on the basis of petitioner's theory that whoever brought the cargo to the airport or loaded it on the plane did so as an agent of private respondents.TRANSPORTATION AND MARITIME LAW of delivery has been unequivocally esablished can the reqt.
In this case. Condition No. They contended that there was no reason for the personnel to disclaim knowledge of the arrival or whereabouts of the body other than their sheer arrogance. customs and usages. the law implies a contract that they shall be delivered at destination within a reasonable time. such condition only serves to insulate the carrier from liability in those instances when the changes in routes. PAGE 63 . indifference and extreme insensitivity to their feelings. When TWA shipped the remains on an earlier flight. the switching of the caskets. emergencies in aviation. such as weather turbulence. of national security and the like. 5 is binding on the plaintiff even if it is printed at the back of the airway bill. The EEs of TWA presumably caused the mix-up by loading the wrong casket on the plane. it allegedly violated the terms of the airway bill which compounded. It must be pointed out that the lamentable actuations of TWA's EEs leave much to be desired. TWA must be presumed negligent unless such is rebutted. This is clearly sanctioned by the contract of carriage. arrogant or indifferent manner as to amount to BF or malice.they wanted to assure that the shipment would be received in SF in sufficient time for transfer to PAL. no special contract for prompt delivery was entered into by the parties. mechanical failure. xxx and that Carrier may without notice substitute alternate carriers or aircrafts xxx. reqts. it did so in the exercise of sound discretion and with reasonable prudence -. TWA knew of the urgency of the shipment due to the notation on the airway bill : "xxx Please return bag first available flight to SFO. TWA did not undertake to carry the cargo aboard any specified aircraft. their tension and anxiety wrought by the confusion and the fear about where their mother's remains were. or by contingencies. even without notice and without the assumption of any obligation whatsoever to carry the goods on any specified aircraft. Said faithful compliance was not affected by the fact that the remains were shipped on an earlier flight as there was no fixed time for completion of carriage stipulated on. TWA contends that it faithfully complied with the obligations under the airway bill. SC: It affirmed the CA's findings that TWA EEs did not deal with petitioners in a grossly humiliating. flights and schedules are clearly justified by the peculiar circumstances of a particular cae. which provides that " xxx no time is fixed for the completion of the carriage. in the absence of any agreement as to the time of delivery. When a CC undertakes to convey goods." SC : TWA's contention is tenable. or by general transportation practices. the delay in the delivery of the remains cannot be attributed to the fault.TRANSPORTATION AND MARITIME LAW scheduled. in view of the condition on the back of the airway bill. Airline companies are sternly admonished to strictly require their personnel to be more accommodating to passengers and the general public. if not directly caused. In case at bar. arrogant and indifferent acts of their officers and personnel. TWA can use substitute aircraft. negligence or malice of private respondents. particularly so given the grief of petitioners." (4) Petitioners alleged that private respondents are liable for tort on account of humiliating. This is in the nature of a contract of adhesion. However.
by themselves or through their superiors. cannot be recovered. 6. 2221 and 2222 of the Civil Code makes it clear that nominal damages are not intended for indemnification of loss suffered but for the vindication or recognition of a right violated or invaded. moral damages cannot be awarded. malice or bad faith. (6) In actions for legal support. (2) When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest. at least. just and demandable claim. the assessment of damages being left to the discretion of the court accdg. rather than just shrug off the promblem with a callous and uncaring remark that they had no knowledge about it. PAGE 64 . other than judicial costs. (3) In criminal cases of malicious prosecution against the plaintiff. The foregoing observations do not appear to be applicable to PAl and its EEs. 2208. (8) In actions for indemnity under workmen's compensation and employer's liability laws. attorney's fees and expenses of litigation. malice or BF.TRANSPORTATION AND MARITIME LAW Petitioners agonized for 5 hours unattended to and without any assurance from the EEs of TWA. Neither can exemplary damages nor attorney's fees. Nonetheless. (5) Where the defendant acted in gross and evident BF in refusing to satisfy the plaintiff's plainly valid. They are recoverable where some injury has been done but the amount of which the evidence fails to show. Attorney's Fees and Interest Art. In the absence of stipulation. The censurable conduct of TWA's EEs cannot be said to have approximated the dimensions of fraud.000 to be paid by TWA was awarded in favor of petitioners as a reasonable amount in the circumstances. Common sense should have dictated that they exert a little extra effort in making more extensive inquiry. Nominal damages of P 40. except: (1) When exemplary damages are awarded. (7) In actions for the recovery of wages or household helpers. to the circumstances of the case. (4) In case of a clearly unfounded civil action or proceeding against the plaintiff. fraud or BF. to nominal damages from TWA alone. Arts. the facts show that petitioners' right to be treated with due courtesy in accordance with the degree of diligence required by law to be exercised by every common carrier was violated by TWA and this entitles them. (5) In the absence of strong and positive evidence of fraud. (9) In a separate civil action to recover civil liability arising from a crime. laboreres and skilled workers. in the absence of proof that defendants acted with malice.
Indemnity arising from the fact of death is fixed whereas the others are still subject to the determination of the court based on evidence presented. only net earnings are to be considered-. In the determination of the losses or damages sustained by dependents and heirs of the deceased. and (6) interest. oppressive or malevolent manner PAGE 65 .-. fraudulent. In all cases. 2210. (2) indemnity for loss of earning capacity of the deceased. 1756 (2) liability for lost earnings are the deceased passenger's net earnings during his expected length of life based on accepted mortality tables (compensatory damages) (3) PAL is not liable for exemplary damages where it was not proven that it acted in a wanton.total earnings less expenses necessary in the creation of such earnings less living and incidental expenses Damages recoverable when death occurs due to commission of crime.-. but of the support they received or would have received from him had he not died in consequence of the negligence of defendant.TRANSPORTATION AND MARITIME LAW (10) When at least double judicial costs are awarded. factors to be considered 1.A CC's bad faith is not to be lightly inferred from a mere finding that the contract was breached through negligence of the CC's employees (Fores vs Miranda) Extent of liability of air carrier for death of passenger: (1) where there was no satisfactory explanation on the part of PAL as to how and why the accident occurred. Art. under Art. (11) In any other cases where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered. Interest may. be allowed upon damages awarded for breach of contract. In fixing the amount of support. the attorney's fees and expenses of litigation must be reasonable. 4 Agbayani: Damages arising from death. (5) attorney's fees and expenses of litigation. indemnity for death is distinct and separate from the other forms of indemnity Common carrier not liable for moral damages to passenger injured due to negligence of driver. in the discretion of the court. (4) exemplary damages. the rate at which the losses sustained should be fixed. reckless. (3) moral damages. number of years on the basis of which the damages shall be computed 2. the presumption is that it was at fault.(1) indemnity for the death of victim (P 50T). said damages consist not of the full amount of his earnings.
So it is. therefore.-. and vigilance which the circumstances justify demand. precaution. differing in kind and degree. it is liable only for the natural and probable consequences of the breach and which the parties had foreseen or could have reasonably foreseen at the time the obligation was constituted (includes medical. respect. whereby such other person suffers injury Common carrier is liable only for damages that are natural and probable consequence of breach of contract. Therefore. On account of the peculiar situation of the parties. Neglect or malfeasance of the CC's employees naturally could give ground for an action for damages. The relation between CC and passenger involves special and peculiar obligations and duties. It invites people to avail of the comforts and advantages it offers. Its business is mainly with the traveling public. the CC is under the absolute duty of protecting his passengers from assault or insult by himself or his servants.(1) lost income. because of the relation which an air carrier sustains with the public. but acted in GF. hospital expenses) Actual damages. the law implies a promise and imposes upon the CC the corresponding duty of protection and courteous treatment.-. indignities and abuses from such employees.Where the CC is guilty of a breach of contract.TRANSPORTATION AND MARITIME LAW [Davila vs PAL] Nature of liability of air carrier to its passengers: [Zulueta vs Pan Am] Held: A passenger is entitled to courteous treatment from the carrier and its EEs and failure of the CC to comply with this obligation will entitle the passenger to damages. injurious language. They are entitled to be protected against personal misconduct.includes income to be earned by the injured passenger or deceased passenger had he finished his course (could have been foreseen) (2) sum being carried by the deceased passenger which was lost (3) funeral expenses (4) attorney's fees (5) loss of merchandise carried by the deceased (6) loss of baggage and personal belongings PAGE 66 . Damages caused by CC on third persons. generates a relation attended with a public duty. The contract of air carriage.Negligence refers to the failure to observe for the protection of the interests of another person that degree of care. A contract to transport passengers is quite different in kind and degree from any other contractual relation. They have a right to be treated by the CC's EEs with kindness. from those of almost every legal or contractual relation.-. Passengers do not contract merely for transportation. And this.-. courtesy and due consideration. that any rude or discourteous conduct on the part of EEs towards a passenger gives the latter an action for damages against the CC.
mere carelessness of the CC's driver does not per se constitute or justify an inference of malice or BF on the part of the CC xxx CC is subsidiarily liable for moral damages in actions ex delicto or where the action is based upon its liability arising from a crime xxx CC is not ordinarily liable for exemplary or corrective damages based upon the wrongful act of its EE or driver where it did not have anything to do with the wrongful act or had not previously authorized or subsequently ratified such act (Art. wounded feelings.[Ortigas vs Lufthansa] (1) Under the pool arrangement among different airlines of the PAGE 67 . even if death does not result Ex. the heirs of the deceased passenger may demand moral damages in an amount commensurate with the mental anguish suffered by them xxx In a case where the passenger suffers physical injuries because of the CC's injuries. 2332) This cannot be presumed but must be proven by evidence. transpo charges Liability of air carriers for moral and exemplary damages. the TC may consider the nature and extent of the injuries and the suffering occasioned by them and the duration thereof. execution and enforcement of contract of carriage.TRANSPORTATION AND MARITIME LAW Exception to rule that CC is not liable for moral damages in breach of contract: (1) where the mishap results in death of the passenger (2) where it is proved that the CC was guilty of fraud or BF. prejudice or corruption on the part of the TC BF justifying moral damages must be in the securing. BF cannot be imputed but must be alleged and proved. the offended party is not entitled to moral nor exemplary damages but only to the limited amount printed in the plane ticket where the offended party had not declared a higher value nor paid addtl. he cannot recover moral damages for such breach of contract since it does not fall under any of the cases where moral damages are recoverable under Art.-. 2219 xxx In determining the amount of moral damages. exemplary damages cannot be recovered as a matter of right Nominal and exemplary damages awarded for willful breach of contract committed through agent or EE xxx Where the CC has incurred in delay in the delivery of the luggage of the offended party. the passenger suffered social humiliation. but it had not acted in BF nor been guilty of gross negligence. The appellate court should not interfere unless such is palpably and scandalously excessive so as to indicate that it was the result of passion. where because of the BF of the CC. serious anxiety and mental anguish Under 2206.
lapse or neglect thereof will certainly result to the damage. Any omission. inattention and lack of care on the part of the CC resulting in the failure of the passenger to be accommodated in the class contracted for amounts to BF or fraud which entitles the passenger to the award of moral damages.TRANSPORTATION AND MARITIME LAW IATA agreement of which Alitalia and Lufthansa are signatories. Defendant as an airline should be made to pay an amount that can really serve as a deterrent against a seeming pattern of indifference and unconcern. Indemnification in a criminal prosecution is distinct from that awarded as damages in a civil action. 106 SCRA 391] The duty to exercise the utmost diligence on the part of the CC is for the safety of passengers as well as for the members of the crew or the complement operating the carrier. both airlines are constituted as agents of each other in the issuing of tickets and other matters pertaining to their relations with those who would need their services. and discrimination for racial reasons. which is a pernicious system in violation of law and which is in fraud of the traveling public which has a right to expect that the holder of the certificate of convenience be the one to actually operate his transport line. Where the passenger's seat was given to a white passenger. [PAL vs CA. prejudice. injuries and even death to all aboard the plane. xxx The CC is liable for the negligence of his driver in case of breach of contract and cannot avail of the defense that he exercised due diligence in the employment of his driver. discernible in the treatment of air passengers. xxx CC is liable for nominal damages for its failure to bring passengers to their destination which is in violatin of their right as passengers. xxx An action for damages against CC for breach of contract is primary and independent and does not depend upon the previous conviction of the driver or EE. there is willful breach giving rise to an action for moral damages. Other Principles : The offended party has the option between an action for enforcement of civil liability based on culpa criminal and an action for recovery of PAGE 68 . The action for breach of contract imposes on the CC a presumption of liability upon mere proof of injury to the passenger. and crew members alike. (3) Exemplary damages were awarded. xxx [KLM vs CA] A provision in passage ticket that carriage by successive air carriers is to be regarded as a single operation makes the ticket-issuing carrier liable for tortious conduct of other carriers xxx Exemplary damages may be awarded where the vehicle involved in the accident operated under the kabit system. passengers. (2) When it comes to contracts of common carriage.
Responsibility for negligence under the Civil Code is entirely separate from negligence under the Penal Code. Scope of Overland Transportation B. Requisites for a contract of transportation by land or water to be commercial : (1) transportation of merchandise is always commercial (2) transportation of person or news is commercial only when the CC is a merchant or is habitually engaged in transportation for the public * principal requirement : the CC is a merchant or is habitually engaged in transportation for the public. A contract of transportation by land or waterways of any kind shall be considered commercial: 1. air transportation on a commercial basis was not yet known. An independent civil action based on quasi-delict against the ERoperator of a negligent driver cannot be suspended by the filing of a criminal action against the driver. 349. the carrier is a merchant or is customarily [habitually] engaged in transportation for the public. 2. PAGE 69 . When. Death of driver is not a hindrance to a separate quasi-delict action against the CC-employer There is no error in awarding civil damages against a driver in a criminal case even when a separate civil action was filed against the ER. The reason for its noninclusion in the Code of Commerce was that at the time of its promulgation. III. Nature of Contract Art. Culpa contractual and an act or omission punishable by law are two distinct sources of obligation. When it involves merchandise or any object of commerce. CODE OF COMMERCE PROVISIONS ON OVERLAND TRANSPORTATION COMMERCIAL CONTRACTS FOR TRANSPORTATION OVERLAND A. the object carried is of little importance A contract of air transportation may be regarded as commercial since it is analogous to land and water transportation. no matter what its object may be.TRANSPORTATION AND MARITIME LAW damages based on culpa aquiliana.
deposit and guaranty. the cost. Subject Matter Art. In all matters not regulated by this Code. Acts. executive orders. The following laws and regulations are hereby repealed: (2) The provisions of the Code of Commerce governing sales. The bills of lading or tickets in cases of transportation of passengers may be diverse. the point of departure and arrival. A bill of lading may defined as a written acknowledgment of the receipt of goods and an agreement to transport and to deliver them at a specified place to a person named or on his order. parts of Acts. (4) All laws. the rights and obligations of common carriers shall be governed by the Code of Commerce and by special laws. 352. 1766. agency.) There is now no distinction between a transportation contract of a CC under the Civil Code and a transportation contract under the Code of Commerce The New Civil Code does not expressly repeal the provisions of the Code of Commerce on overland transportation. (Ibid. but all of them shall bear the name of the carrier. and administrative regulations which are inconsistent with this Code. it makes such provisions suppletory to the provisions of the Civil Code on CCs. D. the date of shipment. Effect of Civil Code Art. Nature : (1) each bill is a contract in itself and the parties are bound by its terms (2) a bill of lading is also a receipt (3) it is also a symbol of the goods covered by it PAGE 70 . (New Civil Code. Contract of Carriage 1.) Art. It comprehends all methods of transportation. rules of court. loan. Bill of Lading (a) Definition. and with regard to the baggage. with such other statements which may be necessary for their easy identification. the number and weight of the packages. 2270.TRANSPORTATION AND MARITIME LAW C. partnership. one for persons and another for baggage.
TRANSPORTATION AND MARITIME LAW A bill of lading is also a document of title. A document of title is any document used in the ordinary course of business in the sale or transfer of goods, as proof of the possession or control of goods, or authorizing or purporting to authorize the possessor of the document to transfer or receive, either by indorsement or by delivery, goods represented by such document. (b) Form, Contents Art. 350. The shipper as well as the carrier of merchandise and goods may mutually demand of each other the issuance of a bill of lading in which there shall be stated: 1. The name, surname, and domicile of the shipper. 2. The name, surname, and domicile of the carrier. 3. The name, surname, and domicile of the person to whom or to whose order the goods are addressed, or whether they are to be delivered to the bearer of the said bill. 4. A description of the goods, stating their generic character, their weight, and the external marks or signs of the packages containing the same. 5. The cost of the transportation. 6. The date of which the shipment is made. 7. The place of the delivery to the carrier. 8. The place and time at which the delivery is to be made to the consignee. 9. The damages to be paid by the carrier in case of delay, if any agreement is made on this point. Art. 351. In transportation made by railroads or other enterprises which are subject to schedules or the time fixed by regulations, it shall be sufficient that the bills of lading or the declarations of shipment furnished by the shipper refer, with respect to the rate, terms, and special conditions of the transportation, to the schedules and regulations, the application of which he requests; and should no schedule be determined, the carrier must apply the rate of the merchandise paying the lowest, with the conditions inherent therein, always including such statement or reference to them in the bill of lading which he delivers to the shipper. Many of the items required in a bill of lading may be omitted with much advantage to commerce, which aims to have the greatest number of transactions in the last possible time especially in cases where there are tariffs or regulations issued by the carrier company. In this case, the circumstances relative to price, term and conditions of carriage may be omitted and simple reference be made to the tariff and regulations under which the transportation is to be made. (Art. 351)
TRANSPORTATION AND MARITIME LAW The form of the bill of lading is not material : if it contains an acknowledgment by the carrier of the receipt of goods for transportation, it is in legal effect, a bill of lading A ticket issued by a carrier to a passenger is not only a receipt for the fare paid but is the contract between the passenger and the carrier, of the passenger's right to ride in the CC's vehicle Classes of bills of lading : 1. negotiable B/L - where it is stated that the goods will be delivered to the bearer, or to the order of any person named in such document 2. non-negotiable B/L - where the goods are to be delivered to a specified person 3. clean B/L - does not indicate any defect in the goods 4. foul B/L - indicates that the goods covered by it are in bad condition 5. spent B/L - covers goods that have already been delivered by the CC without a surrender of a signed copy of the B/L; the subsequent delivery of the spent B/L cannot give to the buyer of it any actual control of the goods, or anything which can fairly be called delivery 6. through B/L - issued by the CC who is obliged to use the facilities of other carriers as well as his own facilities for the purpose of transporting the goods from the city of the seller to the city of the buyer, which B/L is honored by the subsequent interested carriers who do not issue their own ladings 7. on board B/L - states that the goods have been received on board the vessels which is to carry the goods 8. received for shipment B/L - states that the goods have been received for shipment with or w/o specifying the vessel by which the goods are to be shipped; issued when conditions are not normal and there is an insufficiency of shipping space 9. custody B/L - issued by the CC to whom the goods have been delivered for shipment but the steamer indicated in the B/L which is to carry the goods has not yet reached the port where the goods are held for shipment 10. port B/L - issued by the CC to whom the goods have been delivered and the steamer indicated in the B/L by which the goods are to be shipped is already in the port where the goods are held for shipment Negotiation of Bills by delivery/ by indorsement Effect of fraud, accident on validity of negotiation : not impaired where the person to whom the bill was negotiated paid value thereof in GF without notice of the breach of duty or loss, theft, fraud, accident, mistake, duress or conversion Who may negotiate? owner; any person to whom possession or custody of the bill has been entrusted by the owner Rights acquired: 1. such title to the goods as the person negotiating the bill had or had ability to convey to a buyer in good faith for value
TRANSPORTATION AND MARITIME LAW 2. direct obligation of the CC issuing the bill to hold possession of the goods for him according to the terms of the B/L as fully as if such CC contracted directly with him Transfer of non-negotiable B/L Rights acquired: 1. as against the transferor, title to the goods subject to the terms of any agreement with the transferor 2. right to notify the CC who issued the bill and thereby acquire the direct obligations of such CC to hold possession of the goods for him accdg to the terms of the document; prior to notification of the CC, the title of the transferee may be defeated by levy upon the goods or a subsequent purchaser from the transferor of a subsequent sale of the goods by a transferor (c) Function Art. 353. The legal basis of the contract between the shipper and the carrier shall be the bills of lading, by the contents of which all disputes which may arise with regard to their execution and fulfillment shall be decided, no exceptions being admissible other than forgery or material errors in the drafting thereof. After the contract has been complied with, the bill of lading shall be returned to the carrier who may have issued it, and by virtue of the exchange of this title for the article transported, the respective obligations and actions shall be considered canceled, unless the same act the claims which the contracting parties desire to reserve are reduced to writing, exception being made of the provisions of Article 366. In case the consignee, upon receiving the goods, cannot return the bill of lading subscribed by the carrier, due to its loss or for any other cause, he shall give said carrier a receipt for the goods delivered, this receipt producing the same effect as the return of the bill of lading. B/L constitutes the legal evidence of the contract of transportation --> all disputes between the parties regarding the execution and performance of the contract shall be decided by the contents of the B/L issued by the CC --> the law admits no exceptions other than falsity and material error in the drafting of the B/L As a contract expressing the terms and conditions upon which the property is to be transported, it is to be regarded as merging all prior and contemporaneous agreements of the parties, and in the absence of fraud,
TRANSPORTATION AND MARITIME LAW concealment or mistake, its terms or legal import, when free from ambiguity cannot be explained nor added to by parol (Parol Evidence Rule) 2. Refusal to Transport Art. 356. Carriers may refuse to accept packages which appear unfit for transportation; and if said transportation is to be made by railway, and the shipment is insisted on, the company shall carry them, being exempt from all liability if its objections are so stated in the bill of lading. CC cannot ordinarily refuse to carry a particular class of goods to the prejudice of the traffic in those goods exception : when the goods or packages are unfit for transportation --> if transpo is insisted upon, railroads cannot refuse to carry them, but they shall be exempt from all responsibility if their objections are made to appear in the B/L 3. Doubtful declaration of contents Art. 357. If by reason of well-founded suspicions of falsity in the declaration of the contents of a package, the carrier should decide to examine it, he shall do so before witnesses, in the presence of the shipper or of the consignee. Should the shipper or consignee cited not appear, the examinations shall be made before a notary, who shall draft a certificate of the result of the examination, for such purposes as may be proper. If the declaration of the shipper should be correct, the expenses caused by the examination and those of carefully repacking the packages shall be defrayed by the carrier, and in a contrary case by the shipper. If the CC has a well-founded suspicion of falsity in the declaration as to the contents of a package, he may examine it --> he must follow the procedure under 357 4. No bill of lading Art. 354. In the absence of a bill of lading the respective claims of the parties shall be decided by the legal proofs that each one may submit in support of his claims, in accordance with the general provisions established in this Code for commercial contracts. Art. 351. In transportation made by railroads or other enterprises which are subject to schedules or the time fixed by regulations, it shall be sufficient that the bills of lading or the
there should be no limitations as to form. although it may become obligatory by reason of the regulations of companies or as a condition imposed in the contract by agreement of the parties themselves Where no B/L is issued. he shall be liable for any damage which may be suffered by the goods transported for any other cause whatsoever. to the schedules and regulations. in person or through a person entrusted therewith in the place indicated for their reception. The B/L is not essential to the contract. and special conditions of the transportation. the application of which he requests. to the rules laid down in Art. unless obliged to do so by force majeure. Responsibility of the Carrier 1. terms. and should no schedule be determined. The liability of the carrier shall begin from the moment he receives the merchandise. the disputes between the parties shall be decided accdg. Route Art. it is not obligatory. with the conditions inherent therein.TRANSPORTATION AND MARITIME LAW declarations of shipment furnished by the shipper refer. and at the place indicated for receiving the merchandise 2. and should he do so without such cause. When on account of said force majeure the carrier is obliged to take another route. 354 E. besides paying the amount which may have been stipulated for such a case. the shipper and the CC may mutually demand that a B/L is made. 355. When it commences Art. the carrier may not change the route. If there should be an agreement between the shipper and the carrier with regard to the road over which the transportation is to be made. always including such statement or reference to them in the bill of lading which he delivers to the shipper. Bill not essential to contract : While under 350. he shall be reimbursed for said increase after formal proof thereof. the carrier must apply the rate of the merchandise paying the lowest. PAGE 75 . The fact that a B/L is not issued does not preclude the existence of a contract of transpo. The responsibility of the CC commences from the moment he receives the merchandise --> the delivery must be made to him personally or through his duly authorized agent. with respect to the rate. Provided there is a meeting of the minds and from such meeting arise rights and obligations. 359. causing an increase in the transportation charges.
and the shipper-owner delivers them to the shipper in bad order and condition. Care of Goods Article 361. or by virtue of the nature or defect of the articles. 1734 and 1735 of the Civil Code Art. least expensive and practically passable 3. unless the shipper committed fraud in the bill of lading. Therefore. shall be for the account and risk of the shipper. which is presumed Relate this with Art.TRANSPORTATION AND MARITIME LAW Where there is an agreed route. it then devolves upon the shipowner to both allege and prove that the goods were damaged by reason of some fact which legally exempts him from liability The shipper will suffer losses and deteriorations arising from fortuitous event. The carrier. force majeure. notwithstanding the precaution referred to in this article. PAGE 76 . shall be liable for the losses and damages arising from the causes mentioned in the foregoing article if it is proved that they occurred on account of his negligence or because he did not take the precautions usually adopted by careful persons. The proof of these accidents is incumbent on the carrier. however. together with the indemnity agreed upon --> the CC may not avail of the contract limiting his liability in case of unjustified change of route Where there is no agreed route. placing them for this purpose at the disposal of the judicial authority or of the officials determined by special provisions. the goods transported run the risk of being lost on account of the nature or by reason of an unavoidable accident. all damages and impairment suffered by the goods during the transportation. if the contrary was not expressly stipulated. by reason of accident. If. there being no time for the owners to dispose of the same. making him believe that the goods were of a class or quality different from what they really were. The merchandise shall be transported at the risk and venture of the shipper. the carrier must select one which may be the shortest. force majeure. When goods are delivered on board a ship in good order and condition. the carrier shall proceed to their sale. or inherent nature and defects of the goods (at the risk and venture of the shipper) It does not mean that the CC is free from liability for losses and deterioration arising from his negligence or fault. the CC shall be liable for losses due not only to the change of route but also to other causes. 362.
earthquake. NCC --> except that under 1732. proof of extra-o diligence is required and not just ordinary diligence as implied under 362 Where goods run risk of loss due to their nature.2. 362 provides for the remedy of sale by the CC of the goods. Delivery (a) Condition of Goods Art. storm. 1735. (Ibid. and 5 of the preceding article. 1735. the carrier shall be obliged to deliver the goods transported in the same condition in which. or deterioration of the goods. they were at the time of their receipt. placing them for the purpose at the disposal of the judicial authority or of the officials designated by special provisions Art. unless they prove that they observed extraordinary diligence as required in Art. destruction.) Art.3. he shall be obliged to pay the value of the goods not delivered at the PAGE 77 . 1734. lightning. Art. Common carriers are responsible for the loss. destroyed or deteriorated. without any damage or impairment. or other natural disaster or calamity.TRANSPORTATION AND MARITIME LAW Burden of proof : the CC has the burden of proving that the injury was occasioned by one of the excepted causes The shipper then has the burden to prove that although the injury may have been occasioned by one of the excepted causes. unless the same is due to any of the ff. according to the bill of lading. (New Civil Code. causes only: (1) Flood. (3) Act or omission of the shipper or owner of the goods. (2) Act of the public enemy in war. 1733. yet still the CC is responsible if the injury might have been avoided by the exercise of reasonable skill and attention on his part Art.) 4. 362 is in consonance with Art. With the exception of the cases prescribed in the second paragraph of Article 361. 1. (4) The character of the goods or defects in the packing or in the containers. whether international or civil. CCs are presumed to have been at fault or to have acted negligently. In all cases other than those mentioned in Nos.4. if the goods are lost. and should he not do so. 363. (5) Order or act of competent public authority.
unless the consignee proves the impossibility of conveniently making use thereof in this form. the CC is liable for damages Partial delivery: The consignee may refuse to receive the goods delivered. If. no object being divided for the purpose. and the consignee shall receive those which are sound. 365. and may leave them in the hands of the carrier. or within a reasonable time. If among the goods damages there should be some in good condition and without any defect whatsoever. If the effect of the damage referred to in Article 361 should be only a reduction in the value of the goods. the goods are rendered useless for sale or consumption for the use for which they are properly destined the consignee shall not be bound to receive them. with distinction of the packages which appear sound. If part of the goods transported should be delivered the consignee may refuse to receive them. when he proves that he cannot make use thereof without the others. after appraisal by experts. the obligation of the carrier shall be reduced to the payment of the amount of said reduction in value. on account of the damage. makes it difficult for the CC to prove delivery Art. this separation being made by distinct and separate articles. PAGE 78 . Where all the goods are delivered but damage is to such an extent that their value is diminished. The same provision shall be applied to merchandise in bales or packages. to the B/L they were found at the time they were received. constitute such difference in value --> subject of course to other damages under the NCC Art. if he can prove that he cannot make use of them independently of those not delivered --> true solution depends upon the economic use which the goods transported have (consignee cannot be arbitrary and must justify his determination) Estoppel of shipper by laches : neglect or delay of shipper to demand immediately.TRANSPORTATION AND MARITIME LAW point where they should have been and at the time the delivery should have taken place. without damage or impairment --> otherwise. demanding payment of their value at the current market price that day. the return of the merchandise shipped or its value in case of non-delivery constitutes estoppel by laches Places the CC at a disadvantageous position to show that it had fulfilled what it had undertaken. in the judgment of experts. Duty to deliver goods : duty to deliver the goods in the same condition in which accdg. 364. the foregoing provision shall be applicable with regard to the damaged ones. the obligation of the CC shall be reduced to the payment of the amount which.
the law authorizes the consignee to abandon all the goods Art. the consignee may abandon all the goods to the CC who shall pay the corresponding damages 2. he shall have no right of action against the CC The CC may require in the B/L that the goods be examined at the time of delivery thereof --> the CC may likewise waive such right PAGE 79 . in which case said claim shall only be admitted at the time of the receipt of the packages. no claim whatsoever shall be admitted against the carrier with regard to the condition in which the goods transported were delivered. no action for damages may be maintained against the CC When period begins to run : period begins to run when the consignee received possession of the goods such that he may exercise over it the ordinary control pertinent to ownership There must be delivery of the merchandise by the CC to the consignee at the place of destination --> Art. or (2) ascertainable from the outside part of the package In Case 1.TRANSPORTATION AND MARITIME LAW Where damage renders the goods useless for sale and consumption for the purposes for which they are properly destined: 1. if the damage affects all goods. without the damaged goods. if the damage affects only some of the goods. provided that the indications of the damage or average giving rise to the claim cannot be ascertained from the exterior of said packages. In case of damaged goods. After the periods mentioned have elapsed. the claim against the CC for damages must be made within 24 hours following the receipt of the merchandise In Case 2. or after the transportation charges have been paid. 366 applies only to cases of claims for damage to goods actually turned over by the CC and received by the consignee The conditions under Art. the consignee may abandon only the damaged goods --> but if the consignee can prove that it is impossible to conveniently use the undamaged goods in that form. Within the twenty-four hours following the receipt of the merchandise a claim may be made against the carrier on account of damage or average found upon opening the packages. 366. 366 are not limitation of action but are conditions precedent to a cause of action --> if the shipper or consignee fails to allege and prove the conditions under 366. the damage may either be (1) ascertainable only by opening of the packages. the claim must be made at the time of receipt The claim must be made before the payment of transportation charges ** otherwise.
Art. The consignee may file a provisional claim : it is not necessary that such claim should state a detailed list of the loss or damage. and if the persons interested should not agree to the report of the experts and could not settle their disputes. the said goods shall be examined by experts appointed by the parties. If there should occur doubts and disputes between the consignee and the carrier with regard to the condition of goods transported at the time of their delivery to the former. a third one appointed by the judicial authority. and in case of disagreement. said judicial authority shall order the deposit of the merchandise in a safe warehouse.TRANSPORTATION AND MARITIME LAW Art. the result of the examination being reduced to writing. 367 shall govern --> expert opinion on the matter is not conclusive on the parties PAGE 80 . requiring examination of bad order cargo by the ship's agent before removal from port authorities as condition precedent to an action for recovery cannot modify or add conditions to the B/L --> unreasonable and unfair in that it allows CC to avoid responsibility for the loss of or damage to their cargo when in packages or covered The purpose of short period for claiming damages : to afford the CC a reasonable opportunity and facilities to check the validity of the claims while the acts are still fresh in the minds of the person who took part in the transaction and the documents are still available. If doubts and disputes should arise between the consignee and the CC with respect to the condition of the goods transported at the time of the delivery. 367. and the parties interested shall make use of their rights in the proper manner. they only have to contain descriptions of the shipments in question sufficient to have allowed the CC to make reasonable verifications of such claim --> the determination of the specific amount of damages claimed should be done carefully and without haste and these can be done only in a formal claim which will be filed after the provisional claim This stipulation is in the nature of a limitation upon the owner's right to recovery --> the burden of proof is on the CC to show that the limitation was reasonable and in proper form or within the time stated (see Southern Lines vs CA) A a stipulation in the B/L providing for a shorter period than the statutory period within which to bring action for breach is valid --> does not in any way defeat the right to recover but merely requires that said right be asserted by action at an earlier period (filing of claims is different from filing of suits) Art. 366 is modified by a B/L prescribing a longer period for filing of written claim with the CC or its agent The unilateral action of a CC in stamping a condition in the notice of arrival.
where there is no judge of first instance. where the consignee cannot be found at the residence indicated 2. The delivery must be made to the consignee Where the B/L is issued to the order of the shipper. by the mere fact of being designated in the bill of lading to receive it. Judicial deposit as a remedy: 1. without prejudice to a person having a better right. 368. to be placed at the disposal of the shipper or sender. and should he not do so he shall be liable for the damages which may arise therefrom. the deposit of said goods shall be ordered by the municipal judge. and where the CC delivered the goods to another person who did not present the B/L. this deposit having all the effects of a delivery. where the consignee refuses to receive the goods Judicial deposit shall produce all the effects of delivery subject to third persons with better rights PAGE 81 . the CC is under a duty not to deliver the merchandise except upon presentation of the B/L duly indorsed by the shipper. Should the consignee be not found at the domicile indicated in the bill of lading. 369. The carrier must deliver to the consignee without any delay or obstruction the merchandise received by him. he is a stranger to the contract) (c) Judicial Deposit Art. or should refuse to pay the transportation charges and expenses. there is no other recourse than to determine at what moment the right of the shipper to countermand the shipment terminates --> this moment can be no other than the time when the consignee or legitimate holder of the B/L appears with such B/L before the CC and makes himself a party to the contract (prior to that time. where the consignee refused to pay the transportation charges 3.TRANSPORTATION AND MARITIME LAW (b) To Whom Delivery Made Art. or to receive the goods. such CC is liable for misdelivery --> duty to transport the goods safely and to deliver them to the person indicated in the B/L Misdelivery: Delivery to a person different from that indicated in the B/L --> different from non-delivery In case of conflicting orders of the shipper and the consignee (where one orders the return and the other orders the delivery of the goods).
TRANSPORTATION AND MARITIME LAW Duty to look for consignee : if consignee is not present. the carrier shall be liable for the damages which may have been caused by the delay. the latter must use proper and reasonable diligence to find him. Art. otherwise the carrier shall pay the indemnity agreed upon in the bill of lading. under the CC. the difference between the MV of the goods at the time PAGE 82 . he is entitled to reasonable notice from the CC of their arrival and a fair opportunity to take care of and remove them : if the consignee is unknown to the CC. Should no indemnity have been agreed upon and the delay exceeds the time fixed in the bill of lading. 358. and if the consignee still cannot be found. the damages occasioned by the delay shall be suffered by him. 1126. the CC shall pay indemnity stipulated in the B/L. If a period has been fixed for the delivery of the goods. destruction or deterioration. the CC shall be liable for the damages that the delay may have caused. the goods may be stored in a proper place and the CC will have performed his whole duty and shall be discharged from liability as a CC Failure to look for consignee and to give him reasonable notice shall make the CC liable for damages resulting from the delay in the receipt of the goods by the consignee --> apply 1738 on the liability of the CC even when the goods are deposited in its warehouse until after the consignee has been given reasonable notice and opportunity to remove the goods Art.NCC) If no indemnity has been stipulated and the delay exceeds the time fixed in the B/L. (New Civil Code. and should he not do so. neither the shipper nor the consignee being entitled to anything else --> however. damages shall be paid if the carrier refuses to pay the stipulated indemnity or is guilty of fraud in the fulfillment of his obligation (Art. it must be made within the same.) (d) When to be made Article 370. Should no period within which goods are to be delivered be previously fixed. Even when there is an agreement limiting the liability of the CC in the vigilance over the goods. the carrier shall be under the obligation to forward them in the first shipment of the same or similar merchandise which he may make to the point of delivery. neither the shipper nor consignee being entitled to anything else. e. the CC is disputably presumed to have been negligent in case of their loss. Where period fixed for delivery : the CC must deliver the goods within the time fixed --> for failure to do so.g. 1752.
the CC in the absence of any legal exemption and after demand has been made and delivery refused. such as loss of profits on account of the delay or failure of deliver. the consignee cannot refuse to receive the goods and sue for conversion. is liable for a conversion of the property --> the consignee may waive title to the property and sue for conversion and is entitled to the value of the goods at the time they should have been delivered to him --> subsequent tender of the goods by the CC is not available as a defense If there has been demand and the CC tenders the goods. where the CC without cause delays the transportation of the goods. the damages caused by the delay shall be for his account Art. 373. The carrier making the delivery shall also assume all the actions and rights of those who may have preceded him in the transportation. the contract limiting the CC's liability cannot be availed of in case of the loss. his sole remedy is an action for damages on account of the delay --> there can only be conversion if there has been demand and the CC refuses delivery The time for delivery when no period fixed : the CC shall be bound to forward them in the first shipment of the same or similar goods which he makes to the point where he must deliver them --> should he not do so. A carrier who delivers merchandise to a consignee by virtue of agreements or combined services with other carriers shall assume the obligations of the carriers who preceded him. he must have notice at the time of the delivery of the particular circumstances attending the shipment and which would probably lead to such special loss if he defaulted (Mendoza vs PAL) If the CC incurs in delay in transporting the goods. 358 is not violated when though the goods were not shipped on the train agreed upon. and the price at the time when they were delivered to which may be added reasonable expenses caused by delay A CC in GF may be held liable only for damages that were foreseen or might have been foreseen at the time the contract of transpo was entered into --> before a CC could be held liable for special damages. a natural disaster shall not free such carrier from responsibility. reserving his right to proceed against the latter if he should not be directly responsible for the fault which gives rise to the claim of the shipper or of the consignee. they were shipped on another train which arrived earlier than the one agreed upon (e) Two or more carriers Art. The shipper and the consignee shall have an immediate right of action against the carrier who executed the transportation PAGE 83 . destruction or deterioration of the goods Where property in the hands of a CC is not delivered within a reasonable time after it has reached its destination.TRANSPORTATION AND MARITIME LAW when they should have been delivered.
except when his omission arises from his having been induced into error by false statements of the shipper in the declaration of the merchandise. Rights and Obligations of Shipper and/or Consignee 1. If the carrier has acted in accordance with a formal order received from the shipper or consignee of the merchandise both shall incur liability.TRANSPORTATION AND MARITIME LAW contract. 378. Right to Damages (a) Condition imposed on right PAGE 84 . when the CC has acted by virtue of a formal order of the shipper or consignee --> but the CC continues to be liable F. The CC is exempted from responsibility where his failure to comply arises from having been led into error by the falsehood on the part of the shipper in the declaration of the merchandise The shipper or consignee may become liable for noncompliance with govt. Transportation agents shall be obliged to keep a special registry. Successive carriers shall assume the obligations of previous carriers but have a right of action against previous carriers is the latter are directly responsible for the fault giving rise to the claim of the shipper (f) Obligation to keep registry Art. 377. stating the circumstances required by Articles 350 et seq. The carrier shall be liable for all the consequences arising from noncompliance on his part with the formalities prescribed by the laws and regulations of the public administration during the entire course of the trip and upon arrival at the point of destination. rules and regulations. in which there shall be entered. for the respective bills of lading. in progressive order of number and dates. The reservations made by the latter shall not however exempt them from the liabilities they may have incurred by reason of their own act. with the formalities required by Article 36. all the goods the transportation of which is undertaken. or against the other carriers who received the goods transported without reservation. (g) Compliance with administrative regulations Art.
In case the consignee. who shall draft a certificate of the result of the examination. unless the same act the claims which the contracting parties desire to reserve are reduced to writing. this receipt producing the same effect as the return of the bill of lading. the carrier should decide to examine it. After the periods mentioned have elapsed. he shall give said carrier a receipt for the goods delivered. except where in the same act of return or giving of a receipt the PAGE 85 . by the contents of which all disputes which may arise with regard to their execution and fulfillment shall be decided. If by reason of well-founded suspicions of falsity in the declaration of the contents of a package. the respective obligations and actions shall be considered canceled. 366. due to its loss or for any other cause. the expenses caused by the examination and those of carefully repacking the packages shall be defrayed by the carrier. or after the transportation charges have been paid. provided that the indications of the damage or average giving rise to the claim cannot be ascertained from the exterior of said packages. Effect of return of the B/L or giving of the receipt: The respective obligations and actions of the parties against each other shall be considered canceled. 353. the examinations shall be made before a notary. The legal basis of the contract between the shipper and the carrier shall be the bills of lading. in the presence of the shipper or of the consignee. Should the shipper or consignee cited not appear. cannot return the bill of lading subscribed by the carrier. and by virtue of the exchange of this title for the article transported. in which case said claim shall only be admitted at the time of the receipt of the packages.TRANSPORTATION AND MARITIME LAW Art. no claim whatsoever shall be admitted against the carrier with regard to the condition in which the goods transported were delivered. he shall do so before witnesses. If the declaration of the shipper should be correct. exception being made of the provisions of Article 366. no exceptions being admissible other than forgery or material errors in the drafting thereof. upon receiving the goods. After the contract has been complied with. Art. for such purposes as may be proper. 357. the bill of lading shall be returned to the carrier who may have issued it. Art. and in a contrary case by the shipper. Within the twenty-four hours following the receipt of the merchandise a claim may be made against the carrier on account of damage or average found upon opening the packages.
provided it be: (1) in writing. as if they had been lost or mislaid. 2 especially binds the horses. signed by the shipper or owner. and all other principal and accessory means of the CC in favor of the shipper --> this lien is a security for the payment of the value of the goods which the CC must pay in case of loss or misplacement Art.TRANSPORTATION AND MARITIME LAW claims of the parties be reduced to writing subject to the provisions of Art. informing him thereof in writing before the arrival of the same at the point of destination. The value of the goods which the carrier must pay in case of their being lost or mislaid shall be fixed in accordance with what is stated in the bill of lading. vessels. 371. vehicles. vessels and eqpt. PAGE 86 . vehicles. 366 (b) Amount of damages for loss Art. destruction or deterioration of the goods to a degree less than extra-o diligence shall be valid. (2) supported by a valuable consideration other than the service rendered by the CC. referred to in the foregoing articles. the consignee may leave the goods transported in the hands of the carrier. 1744. and not contrary to public policy. and (3) reasonable. no proofs being allowed on the part of the shipper that there were among the goods declared therein articles of greater value. Horses. equipments. although with respect to railroads said obligation shall be subordinated to the provisions of the laws of concession with regard to property and to those of this Code with regard to the manner and form of making attachments and seizures against the said companies. (New Civil Code. 372.) (c) Amount of damages for delay Art. shall be especially obligated in favor of the shipper. In cases of delay on account of the fault of the carrier. and all the other principal and accessory means of transportation. A stipulation between the CC and the shipper or owner limiting the liability of the former for the loss. and money. just. When this abandonment occurs. NCC. that the actual amount of the losses and damages suffered may be proved by the shipper against the carrier Par. The value of the goods stated in the B/L is conclusive between the parties and the shipper is not allowed to prove a higher value It is only when the CC's fault is so gross as to amount to actual fraud. the carrier shall satisfy the total value of the goods.
PAGE 87 . and the goods have a known current price at the place and on the day they should have been delivered. 3) : Provided there is no express agreement as to indemnity in the B/L and there is no fraud on the part of the CC. 371. the consignee may leave the goods transported in the hands of the carrier. be returned to him. 371 (2) --> subject to Civil Code Art. Damages for delay (par. The same provision shall be observed in all cases where this indemnity is due. Should the abandonment not occur the indemnity for loss and damages on account of the delays cannot exceed the current price of the goods transported on the day and at the place where the delivery was to have been made. The expenses arising from the change of consignment shall be defrayed by the shipper. exchanging it for another containing the novation of the contract. without changing the place where the delivery is to be made.TRANSPORTATION AND MARITIME LAW Should the abandonment not occur the indemnity for loss and damages on account of the delays cannot exceed the current price of the goods transported on the day and at the place where the delivery was to have been made. until the moment just before the arrival of the goods at the place of delivery. The shipper may. 360. the damages shall not exceed such value --> subject to Civil Code provisions on damages in case of delay 2. change the consignment of the goods delivered to the carrier. referred to in the foregoing articles. The same provision shall be observed in all cases where this indemnity is due. When this abandonment occurs. provided that at the time of making the change of the consignee the bill of lading subscribed by the carrier. Right of abandonment: Exceptional but limited right The right must be exercised during the intervening period between the moment when the fault of the CC produces a delay. the carrier shall satisfy the total value of the goods. the refusal to accept cannot be effective Damages for abandonment : Art. which is the generative cause of the action. In cases of delay on account of the fault of the carrier. by communicating such abandonment to the CC in writing Where these conditions do not concur. informing him thereof in writing before the arrival of the same at the point of destination. as if they had been lost or mislaid. if one were issued. Right to abandon Art. and the latter shall comply with his orders.
365. the carrier shall be obliged to deliver the goods transported in the same condition in which. where the goods are rendered useless for sale and consumption for the purposes for which they are properly destined 3. The same provision shall be applied to merchandise in bales or packages. this separation being made by distinct and separate articles. Art. 365. With the exception of the cases prescribed in the second paragraph of Article 361. 371. the foregoing provision shall be applicable with regard to the damaged ones. the goods are rendered useless for sale or consumption for the use for which they are properly destined the consignee shall not be bound to receive them. 363. he shall be obliged to pay the value of the goods not delivered at the point where they should have been and at the time the delivery should have taken place. and should he not do so. Art. they were at the time of their receipt. Right to change consignment Art. If. in case of partial non-delivery where the consignee proves that he cannot make use of the goods capable of delivery independently of those not delivered 2. without changing the place where the delivery is to be made. when he proves that he cannot make use thereof without the others. according to the bill of lading. PAGE 88 . provided that at the time of making the change of the consignee the bill of lading subscribed by the carrier. and the consignee shall receive those which are sound. if one were issued. Art. where there is delay through the fault of the carrier 2.TRANSPORTATION AND MARITIME LAW Art. unless the consignee proves the impossibility of conveniently making use thereof in this form. with distinction of the packages which appear sound. change the consignment of the goods delivered to the carrier. demanding payment of their value at the current market price that day. and may leave them in the hands of the carrier. without any damage or impairment. If part of the goods transported should be delivered the consignee may refuse to receive them. exchanging it for another containing the novation of the contract. on account of the damage. 363. The expenses arising from the change of consignment shall be defrayed by the shipper. Cases where consignee may abandon goods : 1. and the latter shall comply with his orders. The shipper may. no object being divided for the purpose. 360. Art. be returned to him. If among the goods damages there should be some in good condition and without any defect whatsoever.
With reference to specific movable property of the debtor. Art. 375 . Railroad corporations have the power to detain freight. the carrier may demand the judicial sale of the goods he transported to a sufficient amount to cover the transportation charges and the expenses incurred. and after said prescription the carrier shall have no further right of action than that corresponding to an ordinary creditor. owner or consignee to pay for such charges.creating a lien in favor of the CC on the goods transported --> 8 day period has been increased to 30 days by the NCC PAGE 89 . The preference of the carrier to the payment of what is due him for the transportation and expenses of the goods delivered to the consignee shall not be affected by the bankruptcy of the latter. 374. Art. 2241. or luggage at public auction following the procedure under the law Art. (New Civil Code.judicial sale of the goods transported 2. for the price of the contract and incidental expenses. and until the time of their delivery. Obligation to pay transportation charges Art. 374 . the ff.TRANSPORTATION AND MARITIME LAW 3. until their delivery and for thirty days thereafter. Art. storage and other transportation charges In case of failure of the shipper. claims or liens shall be preferred : xxx (9) Credits for transportation. and in case of delay in making this payment. provided the action is brought within the eight days mentioned in the foregoing article. to answer for the freight. Art. goods or luggage. the CC has the power to sell such freight. The goods transported shall be specifically bound to answer for the transportation charges and for the expenses and fees caused by the same during their transportation. This special right shall be limited to eight days after the delivery has been made. upon the goods carried.) Two sanctions for the enforcement by the CC of the payment of expenses and transpo charges : 1. goods. 376. 375. The consignees to whom the remittance may have been made may not defer the payment of the expenses and transportation charges on the goods that they received after twenty-four hours have elapsed from the time of the delivery.
Under par. this receipt producing the same effect as the return of the bill of lading. In case the consignee. after the contract of transpo has been complied with. 372(par. 2). the B/L shall be returned to the issuing CC in exchange for the goods transported which are delivered to the shipper or consignee Where the consignee upon receiving the goods cannot return the B/L to the CC by reason of its loss or any other cause. the respective obligations and actions shall be considered canceled. cannot return the bill of lading subscribed by the carrier. no exceptions being admissible other than forgery or material errors in the drafting thereof. 2. provided that the claim is made w/in 30 days from date of delivery (NCC) 5. unless the same act the claims which the contracting parties desire to reserve are reduced to writing. by which the CC is given a period relatively urgent pertaining to the said goods transported --> after the time has prescribed. by the contents of which all disputes which may arise with regard to their execution and fulfillment shall be decided. exception being made of the provisions of Article 366. except where in the same act of return or giving of a receipt the PAGE 90 . due to its loss or for any other cause. The legal basis of the contract between the shipper and the carrier shall be the bills of lading. and the right of the CC to demand the sale of the goods to satisfy the cost of transportation and other expenses. his preference prescribes and his only remedy is by ordinary action The mere fact that the goods remain in the possession of the CC because they have not been removed by the consignee. 3. and by virtue of the exchange of this title for the article transported. After the contract has been complied with. Art. he shall give said carrier a receipt for the goods delivered. do not deprive the CC of its right to demand in a proper action the amounts owing to it by reason of the contract of transpo The bankruptcy of the consignee shall not cut off the preference of the CC. Obligation to return bill of lading Art. par. Art. upon receiving the goods.TRANSPORTATION AND MARITIME LAW The purpose of the lien and time limit: Reciprocal to that established in favor of the shipper under Art. time limit rests on the necessity which the consignee must have for alienation of the goods. 353. 353 provides that he must give the CC a receipt of the goods delivered Effect of return of the B/L or giving of the receipt: The respective obligations and actions of the parties against each other shall be considered canceled. the bill of lading shall be returned to the carrier who may have issued it. 353.
Sec. 33. PAGE 91 . embodied in the same complaint. 19. 379.000). 366 G. litigation expenses. Applicability of Provisions Art. including the grant of provisional remedies in proper cases. irrespective of whether the causes of action arose out of the same or different actions. IV. and costs. shall also be understood as relating to persons who. or in Metro Manila where such personal property. Jurisdiction over Admiralty Cases BP 129. Concept of Admiralty. In either case they shall be subrogated to the place of the carriers with regard to the obligations and liability of the latter. estate or amount of the demand does not exceed one hundred thousand pesos (P100. The provisions contained in Article 349 et seq. the amount of the demand shall be the totality of the claims in all the causes of action. litigation expenses. where the value of the personal property. That interest. Regional Trial Courts shall exercise exclusive original jurisdiction: xxx (3) In all actions in admiralty and maritime jurisdiction where the demand or claim exceeds one hundred thousand pesos (P100. BP 129. the amount of which must be specifically alleged: Provided. testate and intestate. Metropolitan Trial Courts. exclusive of interest. estate. further. and costs shall be included in the determination of the filing fees: Provided. Municipal Trial Courts and Municipal Circuit Trial Courts shall exercise: (1) Exclusive original jurisdiction over civil actions and probate proceedings.000). That where there are several claims or causes of action between the same or different parties. attorney's fees. damages of whatever kind.000) xxx. Sec. either as contracts for a special and fixed transaction or as freight and transportation agents. although they do not personally effect the transportation of commercial goods. contract to do so through others. as well as with regard to their right. ADMIRALTY AND MARITIME COMMERCE A.TRANSPORTATION AND MARITIME LAW claims of the parties be reduced to writing subject to the provisions of Art. or amount of the demand does not exceed Two hundred thousand pesos (P200. attorney's fees. damages of whatever kind.
i. This is the very case before us. the CFI has jurisdiction over admiralty cases. but not over nonmaritime contracts. but on the subject matter of the contract. as operator of an arrastre service. 865 is found was evidently intended to define the law relative to merchant vessels and marine shipping. Under the law. making the locality the test. The liability of IH is predicated on the contract of carriage by sea between IH and Yaras & Co. Whether or not a contract is maritime depends not on the place where the contract is made and is to be executed. Said article cannot be applied to small boats engaged in river and bay traffic. is inadmissible. the true criterion being that the contract has reference to maritime service or maritime transaction. seeks to recover from the petitioner IH the value of certain lost cargo.TRANSPORTATION AND MARITIME LAW International Harvester vs Aragon 84 Phil 363 Held : It is clear from the complaint that IH is being held liable only on the assumption that the goods had been lost in transit or before being discharged at the pier. The contention of Yaras that the admiralty jurisdiction is not involved because the contract in question was made upon land and to be terminated upon land. whether evidenced by a B/L or a charter party. wherever they were executed or are to be performed. Admiralty has jurisdiction over all maritime contracts. in whatever form.e. PAGE 92 . as evidenced by the B/L. and the vessels intended in that Book are such as are run by masters having special training with the elaborate apparatus of crew and equipment indicated in the Code. Vessels 1. It is now well-settled in the latter country that the jurisdiction of admiralty in matters of contract depends upon the subject matter. The vessels intended in the Third Book of the Code of Commerce which deals with maritime commerce and in which Art. Meaning Lopez vs Duruelo 52 Phil 229 Held : Assuming that article 835 of the Code of Commerce states a condition precedent to the maintenance of an action in a case requiring protest. The article is found in the section dealing with collisions and the context shows the collisions intended are collisions of sea-going vessels. B. admiralty has jurisdiction of a proceeding in rem or in personam for the breach of a contract of affreightment. merely reflects the English rule which had long been rejected in the US. making the true criterion a maritime service or a maritime transaction. because the respondent Yaras & Co.. such as protest is nevertheless not necessary in the case at bar. And typical of a controversy over contracts of affreightment is a suit of one party against the other for loss or damage to the cargo. the nature and character of the contract and that the English rule which conceded jurisdiction only to contracts made upon and to be performed upon navigable waters. independently of the liability of the Manila Terminal Co. Specifically.
The ownership of a vessel shall also be acquired by the possession thereof in good faith for three years. The word ship and vessel. etc. a protest still need not be made since under Art. such as river boats and those carrying passengers from ship to shore are governed as to their liability in passengers. In the absence of any of these requisites. The acquisition of a vessel must be included in a written instrument. including floating docks. want of protest cannot prejudice a person not in a condition to make known his wishes. by the Civil Code. 2. Merchant vessels constitute property which may be acquired and transferred by any of the means recognized by law. dredges. and other floating apparatus for the service of the industry or maritime commerce. merchant or war. A person who has suffered injuries like that of the plaintiff cannot be supposed to be in a condition to make a protest. pontoons. they are not applicable to small craft which are only subject to administrative regulations in the matter of port service and in the fishing industry. Vessels of minor nature. ought to be subjected to the principles of the Code with reference to ownership. with a good title duly recorded. 573. offering their services to the public PAGE 93 . in their grammatical sense are applied to designate every kind of craft. whether coastwise or on the high seas. a signification which does not differ essentially from its juridical meaning according to which vessels for the purpose of the Code of Commerce. or floating structures of every kind without limitation. which shall not produce any effect with regard to third persons if not recorded in the registry of vessels.dredges. But even if The Code Of Commerce was applicable. scows. Vessels: Those engaged in navigation . rights. Yet notwithstanding these principles from which it would seem that any floating apparatus which serves directly for the transportation of things or persons or which indirectly is related to this industry.TRANSPORTATION AND MARITIME LAW The word "vessel" used in the section was not intended to include all ships. and the provision of that section should not be held to include minor craft engaged only in river or bay traffic. uninterrupted possession for ten years shall be necessary in order to acquire ownership. transfer. are considered not only those engaged in navigation whether coastwise or high seas. pontoons. Nature and acquisition of vessels Art. registrations. large or small. A captain cannot acquire by prescription the ship of which he is in command. 836. craft. but also floating docks. scows and any other floating apparatus destined for the services of the industry or maritime commerce Vessels engaged in the business of carrying or transporting passengers or goods for compensation.
and (7) other means. towboats and other craft destined to other uses. river boats and those carrying passengers from ship to shore. floating storehouses. by the provisions of the Civil Code Modes of acquisition: (1) purchase and sale. on account of their value and importance in the world of commerce PAGE 94 . Vessels are considered personal or movable property. health. For all purposes of law not modified or restricted by the provisions of this Code. it will ripen into ownership in 10 years There can be no prescription in favor of the captain because the nature of the possession of the captain is such that he is only an agent of the owner. (4) capture. crafts engaged in the loading and the discharge of vessels. if the possession is otherwise. (3) construction. warships or patrol vessels. fishing vessels. yachts. Ship owners and seamen shall be subject to the provisions of the laws and regulations of the public administration on navigation. a depositary of the vessel The acquisition of a vessel must appear in a written instrument and such instrument must be registered in order that the transfer may affect third persons Art. and other similar matters. coast guard vessels. 585. The business of constructing and repairing vessels or parts thereof shall not be considered a public utility and no CPC shall be required thereof Art. such as. pontoons. (5) donation. customs. (6) succession. such as coast and geodetic survey. 574. of the nature and conditions of real property. but they partake to a certain extent. or transhipments from one vessel to another Vessels of a minor nature not engaged in maritime commerce. safety of vessels. scientific research and exploration. (2) prescription. health service and harbor police vessels. must be governed as to their liability to passengers. Builders of vessels may employ the material and follow with regard to their construction and rigging the systems most suitable to their interest. vessels shall continue to be considered as personal property.TRANSPORTATION AND MARITIME LAW are common carriers --> governed primarily by the Civil Code provisions on common carriers and subsidiarily by the Code of Commerce and special laws The Code of Commerce regulates merchant ships or those engaged in the transportation of passengers and freight from one port to another or from place to another The Code of Commerce does not refer to pleasure ships. such as barter Possession in GF will ripen into ownership in 3 years.
PD 761 as amended by PD 1064. To this end. as Bureau of Commerce. may register its own vessels xxx if such vessels are to be used exclusively to transport its own raw materials and finished products in Philippine waters as an incident to its manufacturing. 1521 Sec. and in the case of corporations or associations which will engage in coastwise trade the president and managing directors thereof shall be such citizens xxx xxx an enterprise duly registered with the Board of Investments WON entirely owned by foreign nationals. waters. BOI. Export Incentives Board or Oil Commission. and in consequence of certain contracts. by testate and intestate succession. Ownership and other real rights over property are acquired and transmitted by law. or capable of being used. it shall be the duty of the master. They may also be acquired by means of prescription.) 3. If the vessel is of domestic ownership and of 15 tons gross or less. agencies. and of more than 15 tons gross. the taking of the certificate of Philippine registry shall be optional with the owner.person. NACIDA. a certificate of Philippine registry shall be issued for it. as now or may hereafter be required by law. (New Civil Code. Domestic ownership means ownership vested in the citizens of the Philippines or corporations or association organized under the laws of the Philippines at least 60% of the C/S or capital of which is wholly owned by citizens of the Philippines. by tradition. shall be registered with the MARINA. craft or other artificial contrivance used. as a means of transportation on water (2) duly registered . registered with the proper govt. Marina Rules and Regulations: Subjects of Registration: 1) All vessels used in Phil. 712.every sort of boat. owner and agent of every such vessel to make application to the proper MARINA district office for PAGE 95 . 802 (1) vessels . SEC.TRANSPORTATION AND MARITIME LAW Art. not being transients of foreign registry. Registration. by donation. distinctions Tariff and Customs Code. 806. Rule III. certificates issued. Upon registration of a vessel of domestic ownership. Sec. processing or business activity registered with the BOI and certified to by said Board as an essential element in the operation of the registered project. Ownership is acquired by occupation and by intellectual creation. natural or juridical.
and bancas.TRANSPORTATION AND MARITIME LAW registration thereof within 15 days after the vessel becomes subject to such registration. and at the same time secures to it the same privileges and subjects it to the same disabilities as. a certificate of Phil. Coast Guard is vested with exclusive authority over the registration and documentation of Phil. vessels. register shall be issued for it The purpose of certificates of register of vessels : to declare the nationality of a vessel engaged in trade with foreign nations and to enable her to assert that nationality wherever found Privileges of certificate: It confers upon the vessel the right to engage. but the proper fee shall be charged for measurement when measurement is necessary. 2) A vessel of 3 tons gross or less shall not be registered unless the owner shall so desire. or other documents necessary or incident to such registration The registration shall be effected at its home port or at the nearest Coast Guard district or station when the home port does not have such Certificates of Philippine register: upon registration of a vessel of domestic ownership and of more than 15 tons gross. for military purposes. as well as the issuance of all certificates. 3) All undocumented vessels shall be numbered in such form as may be prescribed by the Administrator. consistently with law. under the laws of the Philippines. a certificate of ownership shall be issued for it 4. nor shall documents licenses of any kind be required for such vessel. in the Philippines coastwise trade and entitles it to the protection of the authorities and the flag of the Philippines in all ports and on the high seas. sail boats and other water craft which are not motorized of less than 3 gross tons shall not be subject to the requirements of these rules and regulations relative to registration and navigation. except in so far as may be prescribed by regulations of MARINA. Significance of registration of transactions affecting vessels PAGE 96 . Vessels exempt from Registration : AFP vessels. except when the same is engaged in towing or carrying of articles and passengers for hire. vessels owned and/or operated by the AFP or by foreign govt. The Phil. licenses. pertain to foreign built vessels transferred abroad to citizens of the Philippines Certificates of ownership : upon registration of a vessel of more than 5 tons gross.
although not recorded. Judgment affirmed in part in the sense that as between Yu and PNB. 1171 of AC has modified the provisions of the Chattel Mortgage Law. But as against creditors of the mortgagor. The amendments solely consisted in charging the Insular Collector of Customs. In view of said legal provisions. 4 thereof. That the collector did not perform his duty was no fault of PNB. Rubiso vs Rivera 37 Phil 72 HELD : The requisite of registration in the registry of the purchase of a vessel is necessary and indispensable in order that the purchaser's rights may be maintained against a claim filed by a third person. Mortgages on vessels. since May 18. It is now not necessary for a chattel mortgage of a vessel to be noted in the register of deeds. Such registration is required both Art.000. C. it is undeniable that defendant's rights cannot prevail over those acquired by plaintiff in the ownership of said boat. as at present. in as much as defendant's registration came after plaintiff's registration. 1909. But it is essential that a record of documents affecting the title of a vessel be entered in the office of the collector of customs at a port of entry. Persons Participating in Maritime Commerce PAGE 97 . This uncontradicted fact must be taken as curing the bank's defective title. and set aside in part in the sense that the record is remanded for further proceedings. we find an explanation of the delay of registration with the collector of customs-because of doubts entertained by the latter relative to the applicability of Act No. However. has been performing the duties of the commercial registry in place of this latter official. who. with the fulfillment of the duties of the commercial register concerning the registering of vessels. 573 of the Code of Commerce in connection with Sec 2 of Act No.. the latter has a superior right to its claim for P20.TRANSPORTATION AND MARITIME LAW Presumption of ownership from registration : the presumption is that the person in whose name a vessel is registered has legal title thereto --> but such is not conclusive proof against the real owners It is essential that a record of documents affecting the title of a vessel be entered in the Philippine Coast Guard Arroyo vs Yu 54 Phil 511 HELD : Sec. are good as between the parties. 1900 which Act amended said article. an unrecorded mortgage is valid. 3324 to a mortgage executed in 1918 in favor of a Chinese subject. This is designed to protect persons who deal with a vessel on the strength of the record title. so that the registration of a bill of sale of a vessel shall be made in the Insular Collector of Customs. particularly Sec.
587. The owner of a vessel and ship agent shall be civilly liable for the acts of the captain and for the obligations contracted by the latter to repair. except collision with another vessel (5) under Art. but he may exempt himself therefrom by abandoning the vessel with all her equipments and the freightage he may have earned during the voyage. equip and provision the vessel. negligence. the owner or agent shall be liable. The ship agent shall also be civilly liable for the indemnities in favor of third persons which arise from the conduct of the captain in the care of the goods which the vessel carried. 586. for damages in case of collision due to the fault. 1759. NCC. provided that the amount claimed was invested for the benefit of the vessel (3) for the indemnities in favor of third persons which may arise from the conduct of the captain in the care of the goods transported. or any other member of the complement The agent is liable to the shippers and owners of the cargo transported by it. and provision the vessel. By agent is understood the person entrusted with the provisioning of a vessel. the shipowner and the shipagent are not liable for the obligations contracted by the captain if he exceeds his authority. Art. or want of skill of the captain. as well as for the safety of passengers transported (4) for damages to third persons for tort or quasi-delict committed by the captain. Neither the owner of the vessel nor the agent shall be liable for the obligations contracted by the captain if the latter exceeds his powers and privileges inherent in his position or those which may have been conferred upon him by the former. to the extent of the value of the vessel. Art.TRANSPORTATION AND MARITIME LAW 1. sailing mate. 826. Shipowners and shipagents Art. 857. its equipment and the freight Under 588. the ship owner is liable for the death of or injuries to the PAGE 98 . for the acts of the captain (2) for contracts entered into by the captain to repair. Liability of shipowner and shipagent : (1) under Art. equip. for losses and damages occasioned to such cargo without prejudice to his rights against the owner of the ship. if the amounts claimed were made use of for the benefit of the vessel. provided the creditors proves that the amount claimed was invested therein. or who represents her in the port in which she happens to be. However. 588. unless the amounts claimed were invested for the benefit of the vessel --> however under Art.
All the part owners shall be liable. but the proceedings shall be limited to the interest the debtor may have in the vessel. and provisioning of the vessel. an association shall be presumed as established by the part owners. referred to in Article 587. Art. A majority shall be the relative majority of the voting members. They shall likewise be liable in the same proportion for the expenses of maintenance.TRANSPORTATION AND MARITIME LAW passengers which are caused by the negligence or wilful acts of his EEs although such EEs may have acted beyond the scope of their authority or in violation of the orders of the shipowner Art. If the interests are equal. for the results of the acts of the captain. A vessel cannot be detained. If two or more persons should be part owners of a merchant vessel. equipment. The resolutions of the majority with regard to the repair. Art. 591. unless they renounce their participation therein. If there should be only two part owners. without interfering with her navigation. Each part owner may exempt himself from this liability by the abandonment before a notary of the part of the vessel belonging to him. The co-owners of a vessel shall be civilly liable. This association shall be governed by the resolutions of a majority of the members. and provisioning of the vessel in the port of departure shall bind the minority. Art. 589. which must be acquired by the other part owners after a judicial appraisement of the value of the portion or portions assigned. equipment. PAGE 99 . in case of disagreement the vote of the member having the largest interest shall be decisive. for the expenses which are incurred by virtue of a resolution of the majority. necessary for navigation. in proportion to their respective ownership. in the proportion of their contribution to the common fund. it shall be decided by lot. 592. 590. The representation of the smallest part in the ownership shall have one vote. attached or levied upon execution in her entirety for the private debts of a part owner. and proportionately the other part owners as many votes as they have parts equal to the smallest one.
fuel. in every case. who shall be bound in all that refers to repairs. 593. 594. Art. and freight of the vessel. the position shall be given to the part owner having the larger interest in the vessel. 597. offering equal conditions and price. Art. The agent shall represent the ownership of the vessel. the matter shall be decided by lot. The owners of a vessel shall have preference in her charter over other persons. and if the vote should result in a tie. and shall contract in the name of the owners. armament.TRANSPORTATION AND MARITIME LAW The resolutions of the majority relating to the dissolution of the association and sale of the vessel shall also be binding on the minority. provisions. If two or more co-owners request the position of captain. The appointment of director or agent shall be revocable at the will of the partners. subject. in all that relates to the requirements of navigation. and should they have an equal interest it shall be decided by lot. PAGE 100 . subject always to the right of pre-emption and redemption mentioned in Article 575. The agent may discharge the duties of captain of the vessel. 596. must be qualified to trade and must be recorded in the merchant's registry of the province. details of equipment. 595. subject to the provisions of the law of civil procedure unless the part owners unanimously agree otherwise. the disagreement shall be decided by a vote of the members. to the provisions contained in Article 609. The part owners shall elect the manager who is to represent them in the capacity of agent. Art. The sale of the vessel shall be made at a public auction. Art. Art. and. in general. The agent. If the interest of the petitioners should be the same. be he at the same time an owner of a vessel or a manager for an owner or for an association of coowners. and there should be a tie. and may in his own name and in such capacity take judicial and extrajudicial steps in all that relates to commerce. If two or more of the former should claim said right the one having greater interest shall be preferred. The agent shall select and enter into an agreement with the captain.
the managing agents shall be entitled to an executory action. * Note : an executory action is no longer recognized in this jurisdiction Art. 604. 601. In order to enforce the payment. for the benefit of the vessel. The agent shall indemnify the captain for all the expenses he may have made from his own funds or from those of other persons. Art. Art. paying them the salaries earned according to their contracts. without the authority of her owner or by virtue of a resolution of the majority of the co-owners. unless there is an expressed and specific agreement in respect thereto. 600. nor insure the vessel. The agent cannot order a new voyage. the co-owners shall satisfy the expenses in proportion to their interest. unless these powers were granted him in the certificate of his appointment. nor make contracts for a new charter. If he should insure the vessel without authority therefor he shall be subsidiarily liable for the solvency of the underwriter. without prejudice to the civil or criminal actions which the minority may deem fit to institute afterwards.TRANSPORTATION AND MARITIME LAW Art. 598. shall give his co-owners an account of the results of each voyage of the vessel. they shall receive their salary until their return PAGE 101 . After the account of the managing agent has been approved by a relative majority. The managing agent of an association. 599. If the captain or any other member of the crew should be discharged during the voyage. Art. Should there be any profits. and without further proceedings than the acknowledgment of the signatures of the persons who voted for the resolution. without prejudice to always having the books and correspondence relating to the vessel and to its voyages at their disposal. the co-owners may demand of the managing agent the amount due them. 603. Art. 602. Before a vessel goes out to sea the agent may at his discretion. which shall be instituted by virtue of a resolution of the majority. discharge the captain and members of the crew whose contract did not state a definite period nor a definite voyage. by means of an executory action without further requisite than the acknowledgment of the signatures in the instrument approving the account. and without any indemnity whatsoever. Art.
robbery. and damage caused to the vessel or to its cargo by malice or manifest or proven negligence. and navigation. Art. habitual drunkenness. if he does not prove that he made full use of his authority to prevent or avoid them. he may not be discharged unless the agent returns to him the amount of his interest therein. reserving to the latter his right to the indemnity which may be proper. and confiscations imposed on account of violation of the laws and regulations of customs. Art. of this Code. 2. they cannot be discharged until the fulfillment of their contracts.TRANSPORTATION AND MARITIME LAW to the place where the contract was made. Art. which. in the absence of an agreement between the parties. reserving his right of action against the guilty parties. the latter should be insolvent. Art. shall be appraised by experts appointed in the manner established in the law of civil procedure. If the captain who is a part owners should have obtained the command of the vessel by virtue of a special agreement contained in the articles of copartnership. In case of the voluntary sale of the vessel. For all the damages suffered by the vessel and its cargo by reason of want of skill or negligence on his part. 4. 636 et seq. For the losses. health. after the action against the vendor has been instituted. 606. If the captain should be a part owner in the vessel. If a misdemeanor or crime has been committed he shall be liable in accordance with the Penal Code. according to the agreements made with the agent. or by reason of faults committed by the crew in the service and defense of the same. For the losses and damages caused by mutinies on board the vessel. 608. unless there are good reasons for the discharge. The captain shall be civilly liable to the ship agent and the latter to the third persons who may have made contracts with the former 1. fines. 605. If the contracts of the captain and members of the crew with the agent should be for a definite period or voyage. PAGE 102 . all in accordance with Art. he cannot be deprived thereof except for the reasons mentioned in Article 605. all contracts between the agent and captain shall terminate. Art. police. For all the thefts and robberies committed by the crew. 618. theft. 3. except for reasons of insubordination in serious matters. The vessel sold shall remain subject to the security of the payment of said indemnity if. 607.
For those arising by reason of his going out of his course or taking a course which. for failure to follow PAGE 103 . the ship agent is simply subsidiarily liable Liabilities of captain: the responsibility of the captain extends to every fraudulent or negligent act of any person in the complement. For those arising by reason of the nonobservance of the provisions contained in the regulations for lights and maneuvers for the purpose of preventing collisions. 7. No exception whatsoever shall exempt him from his obligation. 6. the owner of the ship. leaving him to obtain recourse. For those arising by reason of his voluntarily entering a port other than his destination. the shipowner and that party may validly stipulate that the latter shall be exempt from liability for the negligence of the captain and crew Reason for imposition of liability on owner for damages suffered by third persons occasioned by the acts of the captain: To place the primary liability upon the person who has actual control over the conduct of the voyage and who has the most capital embarked in the venture. he should not have taken without sufficient cause. with the exception of the cases or without the formalities referred to in Article 612. 8. in the opinion of the officers of the vessel. at a meeting attended by the shippers or supercargoes who may be on board. from other individuals who have been drawn into the venture as shippers The shippers and passengers in making contracts with the captain do so through the confidence they have in the shipowner who appointed him --> they presume that the owner made a most careful investigation before appointing him Distinction between liability for lawful and unlawful acts : The lawful acts and obligations of the captain beneficial to the vessel may be enforced as against the agent/owner for the reason that such obligations arise from the contract of agency ( provided that the captain does not exceed his authority) As to any liability incurred by the captain through his unlawful acts. the captain shall be civilly liable to the ship agent and the latter is the one liable to third persons This article applies to breaches of contract and tortious negligence of the captain But where the vessel is totally chartered for use of a single party. Art. namely. 618 provides for the direct responsibility of the shipowner and shipagent to third persons. in the execution of his employment --> he does not respond for personal injuries of the crew arising from personal quarrels but he is liable for damages to persons or property occasioned by a maneuvering of the vessel.TRANSPORTATION AND MARITIME LAW 5. For those arising by reason of a misuse of powers and nonfulfillment of the duties which pertain to him in accordance with Articles 610 and 612.
the shipowner. When jettison of cargo occurs. are civilly liable for the acts of the master.TRANSPORTATION AND MARITIME LAW international rules and regulations.Antwerp Rules. as carriers and depositories of the money were liable under the Civil Code. has complete and exclusive control of the crew and ship navigation. from other individuals who have been drawn into the venture as shippers. the theft not being a fortuitous event or of force majeure and they being manifestly negligent and at fault. This rule. as it is very easy to do. Defendant is therefore liable. with the result that the coasting vessel can use more circumspection about the condition of the weather at departure time. are entitled to contribution as general average loss. The reason for this. It is evident therefore. the shipowner. 586 of the Code of Commerce. for failure to take the precautions to prevent every damage possible to the vessel which has suffered an average Standard Oil vs Castelo 42 Phil 256 Held : Ordinarily." Thus. Code is to place primary liability upon the person who has actual control over the conduct of the voyage and who has most capital in the venture. (a) Responsibilities and liabilities Yu Con vs Ipil 41 Phil 770 Held : Ipil and Solamo. by Reus in Commentaries on the Code of Commerce. It is universally recognized that the captain is the representative of the owner and both under Art. is that boats are small and voyages are short. first made during the days of sailing vessels has changed and it is now generally held that jettisoned goods carried on deck. in captain's person. according to the customs of trade. it is the duty of the captain to effect the adjustment. As to the liability of Lauron. the loss of cargo carried on deck shall not be considered as general average loss. in coastwise trade. liquidating and distribution of the general average. by steam vessels navigating coastwise and inland waters. that the loss of the petroleum is a general average with the result that plaintiff is entitled to recover an amount bearing such proportion to its total loss as the value of both ship and cargo bears to the value of ship and entire cargo before jettison was effected. The owner of the ship ordinarily has vastly more capital embarked upon a voyage than has any shipper of cargo. according to the foregoing definitions (by the Mercantile Code. namely. the SC proceeded by first defining the banca "Maria" as within the meaning of the term "vessel. Moreover. It is therefore proper that any person whose property may have been cast should have a right of action directly against the shipowner for breach of duty which the law imposed on the captain with respect to such cargo. The evident intention of the Com. leaving him to obtain recourse. his failure gave rise to liability for which the owner of the ship must answer. and by Blanco) we hold that the banca "Maria" PAGE 104 . as expressed in the York.
Under Arts. in consequence of misdemeanors and crimes committed by him or by the members of the crew of the craft. the tort in question is not a civil tort under the Civil Code but is a maritime tort resulting in a collision at sea. It is easy to see that to admit the defense of the diligence of a bonus pater familias in the selection and vigilance of the officers and crew as exempting the shipowner from any liability for their faults.TRANSPORTATION AND MARITIME LAW chartered by Yu Con from Lauron. would render nugatory the solidary liability in Art. was also held to be the captain (masters are to small vessels as captains are to big ones). In maritime commerce. the shippers and passengers in making contracts with the captain do so through the confidence they have in the shipowner who appointed him. thus deliberately increasing the risk to which the unknowing passengers would be PAGE 105 . (2) It is to be noted that Macrohon was not duly licensed as a shipmaster and Lim knew of this fact when it hired the former. governed by Arts. 827 for the greater protection of injured parties. Ipil. while the owners of both colliding vessels are solidarily liable for damages caused. and for all losses which. Manila Steamship vs Abdulhaman 100 Phil 32 Held : (1) While it is true that plaintiff's action against petitioner is based on a tort or quasi-delict. through his fault or negligence. and the latter is the one liable to third persons. the shipowner shall be civilly liable to third persons when the captain of the vessel causes the damage or loss to goods entrusted to him by said third persons under a contract to carry said goods. 587 and 618. 826939 of the Code of Commerce. that shipowners and shipagents are civilly liable for the acts of the captain (Art. This direct liability moderated and limited by the owner's right of abandonment of the vessel and earned freight (Art. In fact it is a general principle well established in the maritime law and custom. 587) has been declared to exist not only in the case of breached contracts but also in cases of tortious negligence. 618 of the Code of Commerce. under which the captain shall be civilly liable to the ship agent. Thus. This direct responsibility is recognized in Art. 587). 586) and for the indemnities due to the third persons (Art. and the former must be held civilly liable for indemnities in favor of third parties to which the conduct of the master/captain may give rise in the custody of the effects laden on the craft. it is well and god that the shipowner be not held criminally liable for such crimes or quasi crimes but he cannot be excused from liability for the damage and harm which in consequence of those acts may be suffered by the third parties who contracted with the captain in his double capacity of agent and subordinate of the shipowner himself. was a "vessel" under Mercantile Law and the Code of Commerce. The owner of a minor craft who has equipped and victualed it for the purpose of using it in the transportation of merchandise from one port to another is under the law a shipowner and the master of the craft is to be considered as its captain in the legal acceptation of this word. may occur to the merchandise or effects delivered to him for their transportation as well as for the damages suffered by those who contracted with him. the master of the banca.
as the CA had done. cannot. and freight money earned --> results in the cessation of the responsibility of the owner/agent Abandonment cannot be refused by creditors This applies to all cases where the owner/agent may be held liable for the negligent or illicit acts of the captain Effect of loss or destruction of vessel: The shipagent's liability is merely co-extensive with his interest in the vessel such that the total loss thereof results in its extinction --> the total destruction of the vessel extinguishes a maritime lien as there is no longer any res to which it can attach. To hold. The liability of Lim. 590 and 837 Art. does not apply to cases where the injury of the average is due to shipowner's own fault. (b) The doctrine of limited liability * Doctrine of limited liability is provided for in Arts. The ship agent shall also be civilly liable for the indemnities in favor of third persons which arise from the conduct of the captain in the care of the goods which the vessel carried. A shipagent is liable notwithstanding the insolvency of the principal/owner BUT the ship agent may exempt himself from liability by abandoning the vessel with all her equipment and the freight it may have earned during the voyage --> the effect of abandonment is to extinguish the liability of the shipagent The ship agent's liability is confined to that which he is entitled as a matter of right to abandon : the vessel with all her eqpt. as a legal limitation of a shipowner's liability.TRANSPORTATION AND MARITIME LAW subjected. is to erase all differences between compliance with law and the deliberate disregard thereof. The international rule is to the effect that the right of abandonment of vessels. and the freight it may have earned during the voyage and to the insurance thereof Limited liability is not applicable when no abandonment of vessel is made Effect of abandonment: An abandonment amounts to an offer of the value of the vessel. Thre (3) cases where the loss of the vessel extinguishes the liability of the shipowner: (1) under 587. liability arising from the conduct of the captain in the vigilance of the goods and for the safety of the passengers and for any PAGE 106 . that Lim may limit his liability to the value of his vessels. 587. therefore be identical to that of a shipowner who bears in mind the safety of the passengers by employing duly licensed officers. 587. but he may exempt himself therefrom by abandoning the vessel with all her equipments and the freightage he may have earned during the voyage. of her equipment.
it is an item in the cost of production which must be included in the budget of any wellmanaged industry (3) Total destruction of the vessel does not affect the liability of the owner for repairs on the vessel completed before its loss --> owners of a vessel are liable for necessary repairs. eqpt. this right of abandonment of vessels. Thus. its liability for repairs remains unaffected by the loss of the thing Reason for limited liability: This doctrine had its origin when maritime trade and sea voyage was attended by innumerable hazards and perils --> to offset against these adverse conditions and to encourage shipbuilding and maritime commerce. if any Limited liability is evidence of the real and hypothecary nature of maritime law: (1) limitation of liability to the actual value of the vessel and freight. even to the prejudice of a third person Manila Steamship vs Abdulhaman 100 Phil 32 Issue : How is the doctrine of limited liability applied in this case with M/V Consuelo? Held : The direct liability may be moderated or limited by the shipowner's right to abandon the vessel and earned freight. (2) right to retain the cargo and the embargo and detention of the vessel in cases where the ordinary civil law would not allow more than a personal action against the debtor or personal liable --> the maritime creditor may attach the vessel itself to secure his claim without waiting for a settlement of his rights by a final judgment. it was deemed necessary to confine the liability of the owner or agent arising from the operation of a ship to the vessel. as a legal limitation of a shipowner's liability does not apply to cases where the injury or the average is due to shipowner's fault.TRANSPORTATION AND MARITIME LAW liability arising from the negligent or illicit acts of the captain for which the shipowner or ship agent may be held liable (2) under 643. the owner of Consuelo is solidarily liable with Manila Steamship. liability for collision Exceptions: (1) Doctrine does not apply where shipowner is at fault : the doctrine is premised on the condition that the death or injury to the passenger occurred by reason of the fault or negligence of the captain only (2) Doctrine does not apply in cases of Workmen's Compensation --> such compensation has nothing to do with maritime commerce. PAGE 107 . and freight or insurance. liability for the wages of the captain and the crew and for advances made by the shipagent if the vessel is lost by shipwreck or capture (3) under 837. However. the former having caused the vessel to sail without licensed officers. for injuries caused by the collision over and beyond the value of the said vessel.
the vessel was not insured. Petitioner is absolved from all complaints. damage. thereof. his liability is confined to that which he is entitled as of right to abandon -. The vessel having totally perished. Lim Hong To even declared expressly. such liability is limited to the value of the vessel and other things appertaining thereto such that a total loss thereof results in its extinction. In other words. attended by innumerable hazards and perils.the vessel with all her equipments and the freight it may have earned during the voyage. I shall assume full risks and responsibility for all consequences. to wit. "that in case of any accident. it was deemed necessary to confine the liability of the owner or agent arising from the operation of a ship to the vessel. To offset against these adverse conditions and to encourage shipbuilding and maritime commerce. even assuming that Yangco is liable for breach of contract because his relationship to the passengers rests on a contract of carriage. Abueg vs San Diego 77 Phil 730 Held : The real and hypothecary nature of the liability of the shipowner or agent embodied in the provisions of the Maritime Law. Lim cannot escape liability because of the sinking of the vessel. Thus.TRANSPORTATION AND MARITIME LAW In the application for permission to operate. is immaterial. or loss. the benefit of limited liability applies in all cases (as regards both goods and passengers of the vessel) wherein the shipowner or agent may properly be held for the negligent or illicit acts of the captain. 587 accords a shipowner or agent the right of abandonment. had its origin in the prevailing conditions of the maritime trade and sea voyages during the medieval ages. we have (1) the limitation of the liability of the agents to the actual value of the vessel and the freight money and (2) the right of the maritime creditor to retain the cargo. equipment." Hence. As evidence of this real nature. 587. despite lack of trained crew. In this case. the exclusively real and hypothecary nature of maritime law still operates to limit his liability to the value of the vessel or to the insurance thereon. Operating with an unlicensed shipmaster constitutes such negligence as would prevent the shipowner from claiming the benefit of limited liability under Art. this is a mere deficiency of language and in no way indicates the true extent of such liability. and by necessary implication. Although the article appears to deal only with the limited liability of shipowners or agents for damages arising from the misconduct of the captain in the care of the goods which the vessel carries. and PAGE 108 . The reason for the limited liability is the real and hypothecary nature of maritime law as distinguished from civil law and mercantile law in general. any act of abandonment would be an idle ceremony. if any. Yangco vs Laserna 73 Phil 330 Held : Art. and the embargo and detention of the vessel in cases where the ordinary civil law would not allow more than a personal action against the debtor or person liable. Whether the abandonment of the vessel sought by the petitioner in instant case was in accordance with law or not.
The reason is that the WCA was enacted in abrogation of existing laws.TRANSPORTATION AND MARITIME LAW freight. Art. the Weather Bureau issued a total of 17 warnings or advisories of typhoon Welming. Heirs of Amparo de los Santos vs CA 186 SCRA 649 Held : There is no dispute as to the finding of the captain's negligence. and by necessary implication. While the captain was negligent for overloading the ship. Said Act creates a liability to compensate EEs and laborers in cases of injury received by or inflicted upon them. equipment. Maritima could not account for the delay because it neither checked from the captain the reasons behind the delay. Maritima's claim that it had no information of typhoon Welming until after the boat was at sea is untenable in light of modern technology which enables it to detect any incoming atmospheric disturbances. so that if the shipowner or agent abandoned the ship. and aims at the amelioration of. Under this provision. they are required to observe EO diligence. The limited liability doctrine applies not only to the goods but also in all cases like death or injury to passengers wherein the shipowner of agent may properly be held liable for the negligent or illicit acts of the captain. a shipowner or agent has the right of abandonment. Such a situation will be covered by the Civil Code provisions on CCs. Owing to the nature of their business and for reasons of public policy. his liability was extinguished. 587 speaks only of situations where the fault or negligence is committed solely by the captain. Maritima shares equally in his negligence. while engaged in the performance of their work or employment. The provisions of the Code of Commerce regarding maritime commerce have no room in the application of the Workmen's Compensation Act which seeks to improve. Art. and freight. 587 of the Code of Commerce. 587 does not apply. Maritima displayed lack of foresight and minimum concern for the safety of its passengers taking into account the surrounding circumstances of the case. or insurance. or the heirs and dependents of such laborers and EEs in the event of death caused by their employment. the condition of laborers and EEs. it must be compensated even when the workman's right is not recognized by or is in conflict with other provisions of the Civil Code or Code of Commerce. M/V Mindoro was cleared for departure at 2 PM by the Bureau of Customs and the Coast Guard but its departure was delayed for 4 hours. If an accident is compensable under the WCA. The present controversy centers on the questions of Maritima's negligence and of the application of Art. It was due to PAGE 109 . In allowing the ship to depart late from Manila despite the typhoon advisories. his liability is confined to that which he is entitled as of right to abandon -.the vessel with all her equipments and the freight it may have earned during the voyage. if any. In fact. In cases where the shipowner is likewise to be blamed. The officers of motor ships engaged in fishing are industrial EEs and are entitled to the benefits of the Workmen's Compensation Act. This rule is found necessary to offset against the innumerable hazards and perils of a sea voyage and to encourage shipbuilding and marine commerce.
596. Art. If two or more of the former should claim said right the one having greater interest shall be preferred. If two or more co-owners request the position of captain. Maritima presented evidence of the seaworthy condition of the ship prior to its departure. Art. The appointment of director or agent shall be revocable at the will of the partners. and should they have an equal interest it shall be decided by lot. Part owners of vessels shall enjoy the right of preemption and redemption in the sales made to strangers. including the installation of life saving equipment and other navigational instruments. subject. PAGE 110 . The agent may discharge the duties of captain of the vessel. If the interest of the petitioners should be the same. Art. the position shall be given to the part owner having the larger interest in the vessel. The part owners shall elect the manager who is to represent them in the capacity of agent. It was ordered to pay death indemnities to the heirs of the victims. But it could not present evidence that it specifically installed a radar which could have allowed the vessel to navigate safely for shelter during the storm. (c) Specific rights and prerogatives Art. An important device such as the radar could have enabled the ship to pass through the river and to safety. and if the vote should result in a tie.TRANSPORTATION AND MARITIME LAW this interim that there is great probability that unmanifested cargo and passengers were loaded. offering equal conditions and price. the disagreement shall be decided by a vote of the members. The owners of a vessel shall have preference in her charter over other persons. and there should be a tie. but they can only exercise it within the nine days following the record of the sale in the registry and by delivering the price at once. Maritima's lack of EO diligence coupled with the negligence of the captain were the proximate causes of the sinking of M/V Mindoro. to the provisions contained in Article 609. Maritima is liable for the deaths and injury of the victims. the matter shall be decided by lot. 594. actual damages and attorney's fees. moral damages. in every case. 593. 575.
Art. 609. although they may be engaged in coastwise trade PAGE 111 . pilots. The Philippine Coast Guard shall perform the following functions : (e) to issue licenses and certificates to officers. and shall intrust the navigation to a person possessing the qualifications required by said ordinances nd regulations. 3.Captain . ordinances. 609. he shall limit himself to the financial administration of the vessel. capacity. and must prove that they have the skill. Art. the co. have legal capacity to contract in accordance with this Code. as well as suspend and revoke such licenses and certificates. masters or patrons of vessels must be Filipinos. If the owner of a vessel desires to be the captain thereof and does not have the legal qualifications therefore. or regulations. and must not be disqualfied according to the same for the discharge of the duties of the position. and shall entrust her navigation to the person possessing the qualifications required by said ordinances and regulations. 601. Should there be any profits. or by those of navigation.TRANSPORTATION AND MARITIME LAW Art. and qualifications necessary to command and direct the vessel.owners may demand of the managing agent the amount due them. Captains and Masters (a) Qualifications and licensing RA 5173 Sec. If the owner of a vessel desires to be the captain thereof. notes: . 2. Captains and masters of vessels must be Filipinos having legal capacity to bind themselves in accordance with this Code. Captains. ordinances. he shall limit himself to the financial administration of the vessel. and prove the skill. and qualifications required to command and direct the vessel. by means of an executory action without further requisite than the acknowledgment of the signatures in the instrument approving the account. as established by marine laws. or regulations. without having the legal qualifications therefor.one who governs vessels that navigate the high seas or ships of large dimensions and importance. capacity. as established by marine or navigation laws. major and minor patrons and seamen. and that they are not disqualified according to the same for the discharge of the duties of that position.
4. should said agent be present. but the agent may not employ any member against the captain's express refusal. 5. The following powers are inherent in the position of captain or master of a vessel: 1. who are to take cognizance thereof. in accordance with the instructions he may have received from the ship agent.Master . 6.TRANSPORTATION AND MARITIME LAW . provided there is no time to request instructions of the agent. acting in accordance with the instructions received and protecting the interests of the owner with utmost care. he shall act in concurrence with the latter. 2. which he shall turn over to the authorities. for the repairs to the hull and engines of the vessel and to her rigging and equipment which are absolutely necessary in order for her to be able to continue and conclude her voyage. To impose. purchasing all that may be necessary for the purpose. on board the vessel. To appoint or make contracts with the crew in the absence of the ship agent and propose said crew. but if she should arrive at a point where there is a consignee of the vessel. at the first port touched.Roles of the captain : (1) general agent of the shipowner (2) technical director of the vessels (3) represents the government of the country under whose flag he navigates (b) Inherent Powers Art. 610. correctional punishment upon those who do not comply with his orders or who conduct themselves against discipline. To provide in similar urgent cases and on a voyage. in accordance with the contracts and the laws and regulations of the merchants marine.one who commands smaller ships engaged exclusively in coastwise trade .patron . notes: The first three powers cannot be renounced as they relate to public order and are vested in the captain as a delegation of public authority PAGE 112 . To command the crew and direct the vessel to the port to its destination.captain and master have the same meaning for maritime commerce . 3.bancas . To make contracts for the charter of the vessel in the absence of the ship agent or of the consignee. To adopt all the measures which may be necessary to keep the vessel well supplied and equipped. holding a preliminary investigation on the crimes committed on board the vessel on the high seas.
in order that it may be recorded in the registry when the vessel returns to the port of its registry. to the judge or court or proper local authority. and when he has no funds and does not expect to receive any from the agent. is not required by the outline) Art. (the ff. tackle. 3. and where there should be none. and all the obligations which encumber the same up to that date. he shall apply to the judge or court if he is in the Philippine territory. By borrowing the amount required by means of a bottomry loan. engines. or the local authority. 611. 2. By selling a sufficient amount of the cargo to cover the amount absolutely necessary to repair the vessel and to equip her to pursue the voyage. rigging. the health certificate. The following duties are inherent in the office of captain: 1. in view of the result of the proceedings institutied. 583. and the contracts entered into with the crew. should there be one. presenting the certificate of the registration sheet treated of in Article 612 and the instruments proving the obligation contracted. by reason of the sale of the vessel on account of a declaration of unseaworthiness. shall make a temporary memorandum of their result in the certificate. By requesting said funds of the consignees of the vessel or the correspondents of the ship agent. the captain shall procure the same in the successive order stated below: 1. and otherwise to the consul of the Republic of the Philippines. and other equipments of the vessel. if in a foreign country. Art. and in his absence. the invoices PAGE 113 . proceeding in accordance with the prescriptions of Article 583. the roll of the persons who make up the crew of the vessel. the navigation certificate. the charters or authenticated copies thereof. or so that it can be admitted as a legal and preferred obligation in case of sale before its return. 612. The judge or court. To have on board before starting on a voyage a detailed inventory of the hull. In order to comply with the obligations mentioned in the foregoing article. 4. the certificate of the registry proving the ownership of the vessel. 5. to the local authority. stores. the consul. and with the provisions of the law of civil procedure. if in the Philippines and to the Filipino consul. By applying to the consignees of the cargo or to the persons interested therein. The omission of this formality shall make the captain personally liable for the credits prejudiced on his account.TRANSPORTATION AND MARITIME LAW Art. By drawing on the ship agent. If while on a voyage the captain should find it necessary to contract one or more of the obligations mentioned in subdivisions 8 and 9 of articl 580. In the two last cases he must apply to the judicial authori ty of the port. as the case may be. the list of passengers.
In the third book. and in cases of grave resolutions which require the advice or a meeting of the officers of the vessel. and whether the rigging and engines are in good condition. if required by the shippers and passengers. and the two experts. their wages and salaries." he shall enter every day the condition of the atmosphere. the prevailing winds. he shall record the decision adopted. the sources of the collection. For the informations indicated he shall make use of the binnacle book. PAGE 114 . and in case of disagreement a third shall be appointed by the marine authority of the port. and tackle. He shall furthermore enter therein a list of all the members of the crew. should it have been made at the port of departure. stating their domiciles. 4. should there be any. To have three folioed and stamped books. preserving a certificate of the memorandum of this inspection. and other incidents of navigation. He shall also enter the damage suffered by the vessel in her hull engines. the horsepower of the engines. before receiving the freight. signed by the marine official. and if she has the equipment required for good navigation. To make. In the first book. wages. and the amounts invested in provisions. he shall enter all the amounts collected and paid for the account of the vessel. and the instrument of the expert visit or inspection. as well as the imperfections and averages of the cargo." he shall record the entry and exit of all the goods. entering specifically article by article. stating their marks and packages. placing at the beginning of each one a note of the number of folios it contains. with the officers of the crew. fuel. In the same book he shall record the names and places of sailing of the passengers and the number of packages of which their baggage consists. no matter what is its cause. To have a copy of this Code on board. and the price of the passage. rigging. 3. The experts shall be appointed one by the captain of the vessel and the other one by the persons who request the examination. called the "accounting book". the course sailed. either directly or by delivery to their families. names of the shippers and of the consignees. or even of the passengers and crew. ports of loading and unloading. and of the steam or engine book kept by the engineer. signed by all the persons who may have taken part therein. In the second book. which shall be called "log book. and the amounts they may have received on accounts. the maneuvers executed. the rigging carried. repairs. and in his absence by the competent authority. and all other expenses. called "freight book. under their liability. acquisition of rigging or goods. outfits. and the freight earned.TRANSPORTATION AND MARITIME LAW or manifest of the cargo. in order to ascertain whether she is watertight. an examination of the vessel. 2. the distance covered. and the effects and consequence of the jettison.
registry. which declaration shall be vised by the authority of by the consul if after examining the same it is found to be acceptable. such as inflammable or explosive substances. before twenty-four hours have elapsed. To put in a safe place and keep all the papers and belongings of any members of the crew who might die on the vessel. To be on deck at the time of sighting land and to take command on entering and leaving ports. in the presence of passengers as witnesses.. mail. he must hear the opinion of the officers of the vessel. he allows merchandise to be carried on deck. and. of its cargo. the special character of the shipment. In the absence of marine officials or of the consul. 12. To present himself. or weight makes the work of the sailors difficult. or river. and principally when a port. the officers nor the crew are acquainted. of the reason therefore. or a roadstead or anchoring place is to be entered with which neither he. on account of the nature of the merchandise. drawing up a detailed inventory. and amounts borrowed on bottomry PAGE 115 . 6. stating the name and domicile of the shippers. and reason of arrival. not to consent to any merchandise or goods of a dangerous character to be taken on. To conduct himself according to the rules and precepts contained in the instructions of the agent. and rivers. 8. canal. To take the steps necessary before the competent authority in order to enter in the certificate of the vessel in the registry of the vessels. and principally the favorable season it takes place. telegraph. notify him the freight he may have received. being liable for all that he may do in violation thereof. and which might endanger the safety of the vessel. in their absence. freight earned. giving the captain the proper certificate in order to show his arrival under stress and the reasons therefore. the obligations which he may contract in accordance with Article 583. according to the cases. He shall not spend the night away from the vessel except for serious causes or by reason of official business. and make a statement of the name. 10. To demand a pilot at the expense of the vessel whenever required by navigation. when making a port in distress. roadsteads. canals. and if. without the precautions which are recommended for their packing. the declaration must be made before the local authority. To give an account to the agent from the port where the vessel arrives. etc. of members of the crew. to the maritime authority if in the Philippines and to the Filipino consul if in a foreign country. 9. unless there is a pilot on board discharging his duties.TRANSPORTATION AND MARITIME LAW 5. To remain constantly on board the vessel with the crew during the time the freight is taken on board and carefully watch the stowage thereof. not to permit that any freight be carried on deck which by reason of its disposition. and port of departure of the vessel. taking advantage of the semaphore. volume. management and isolation. 11. 7. and have the consent of the shippers and of the agent.
To remain on board in case of danger to the vessel. and others. PAGE 116 . shall make a protest thereon before the competent authority at the first port he touches within the twenty-four hours following his arrival. If when on a voyage the captain should receive news of the appearance of privateers or men of war against his flag. and then the articles of most value. 622. 618). health. A captain whose vessel has gone through a hurricane or who believes that the cargo has suffered damages or averages. To comply with the obligations imposed by the laws and rules of navigation. advise him of his departure. he shall be obliged to make the nearest neutral port. in which case he shall appear before the nearest authority. stating therein all the incidents of the wreck. in accordance with case 8 of this article. The captain shall proceed in the same manner if. (not included in the outline) Art. 612 are inherent in the captain. and shall ratify it within the same period when he arrives at the place of his destination. he is saved alone or with part of his crew. immediately proceeding with the proof of the facts. and give him any information and date which may be of interest. and await an occasion to sail under convoy or until the danger is over or to receive final orders from the ship agent or shippers. since while the captain is liable to the shipagent. before the competent authority or Filipino consul. Notes: Although the duties in Art. before anything else. To observe the rules on the situation of lights and evolutions to prevent collisions. 14. (not included in the outline) Art. customs. and before abandoning her to hear the officers of the crew. inform his agents or shippers. the shipagent is liable to third persons (Art. abiding by the decision of the majority. and make a sworn statement of the facts. until all hope to save her is lost. In case of wreck he shall make the proper protest in due form at the first port reached. and if he should have to take a boat he shall take with him. 13. 16. the vessel having been wrecked. the civil liability arising from the non-fulfillment thereof is not limited to the captain. being obliged to prove in case of the loss of the books and papers that he did all he could to save them. it not being permitted to open the hatches until after this has been done. 15. within twenty-four hours.TRANSPORTATION AND MARITIME LAW bond. the books and papers. 624.
and without case as reasonably established in an appropriate investigation. turn over the cargo. (not included in the outline) Art. which he must rubricate. to the consignees. the latter shall be accepted. 2. The captain of a vessel is a confidential and managerial employee within the meaning of the above doctrine. and. he shall make a statement of the result of the proceedings in the log book and in that of the sailing mate.] Notes: Under 619. and freights to the agent. unless there is proof to the contrary. NLRC [235 S 634 (1994)] ISSUE: W/N CAPTAIN TAYONG WAS ILLEGALLY DISMISSED? HELD: Yes. A captain commonly performs three (3) distinct roles: (1) he is a general agent of the PAGE 117 . is one who has command of a vessel. Upon arrival at the port of destination. rigging. and custody. under his personal liability. the captain shall. [If. after having obtained the necessary permission from the health and customs officers and fulfilled the other formalities required by the regulations of the administration.TRANSPORTATION AND MARITIME LAW The authority or the consul abroad shall verify the said facts. the delivery of the cargo at the port of discharge terminates the captain's responsibility as to the cargo INTER-ORIENT MARINE ENTERPRISES V. the vessel. by reason of the absence of the consignee or on account of the nonappearance of a legal holder of the invoices. if they disagreed. stamped and folioed. receiving sworn statements of the members of the crew and passengers who may have been saved. and taking such other steps as may help in arriving at the facts. without any defalcation. preservation. with a memorandum of the folios. he shall place it at the disposal of the proper judge or court or authority. for purposes of maritime commerce. in a proper case. A master or captain. 1. It is well settled that confidential and managerial employees cannot be arbitrarily dismissed at any time. and shall deliver the original records of the proceedings to the captain. in order that he may decide with regard to its deposit. 625. the captain does not know to whom he is to make the legal delivery of the cargo. The statement of the captain shall be believed if it is in accordance with those of the crew and passengers. for their presentation to the judge or court of the port of destination.
Of these roles. and properly so. 613. a ship's captain must be accorded a reasonable measure of discretionary authority to decide what the safety of the ship and its crew and cargo specifically requires on a stipulated ocean voyage. A captain who navigates for freight in common or on shares may not make any separate transaction for his own account. In that case. for such role (which to our mind. (c) Prohibited acts and transactions Art. and should he do so the profits shall belong to the other persons interested. the vessel could not reach its destination. Without the consent of the ship agent. is analogous to that of "Chief Executive Officer" [CEO] of a present-day corporate enterprise) has to do with the operation and protection of the vessel during its voyag and the protection of the passengers (if any) and crew and cargo. 4. care and management of the vessel. 3. To the captain is committed the governance. The ship captain.to flee Saigon for the port of Manila . 615. besides being liable for all the acts of the substitute and bound to pay the indemnities mentioned in the foregoing article. Clearly. More importantly. and (3) he is a representative of the country under whose flag he navigates. the captain may not have himself substituted by another person. agree upon rates and decide whether to take cargo. The charterer sued for damages arising from the breach of the charter party. and should he do so. by far the most important is the role performed by the captain as commander of the vessel. Art. and unauthorized sale of the Cargo. PAGE 118 . Hamburg is instructive in this connection. subkect to applicable limitations established by statute. and the losses shall be borne by him alone. (2) he is also commander and technical director of the vessel. In his role as general agent of the shipowner. Compagnie de Commerce v.with the result that the shipowner was relieved from liability for the deviation from the stipulated route and from liability for the damage to the cargo. has legal authority to enter into contracts with respect to the vessel and the trading of the vessel. carry goods aboard and and deal with the freight earned. the substitute as well as the captain may be discharged by the ship agent. the captain of a German vessel at the port of Saigon decided to head for the port of Manila instead of the ports of Dunkirk and Hamburg because of WWI has been declared and in his judgment. the captain has authority to sign bills of lading. the captain is veste with both management and fiduciary functions. contract or instructions and regulations of the shipowner. The captain is held responsible.TRANSPORTATION AND MARITIME LAW shipowner. The SC held that the master of the vessel had reasonable grounds to apprehend that the vessel was in danger of seizure of captur by the French authorities in Saigon and was justified by necessity to elect the court which he took . for such safety. as agent of the shipowner.
TRANSPORTATION AND MARITIME LAW Notes: The duties of a captain are essentially personal due to the confidence given to him arising from the fact that he possesses the required technical ability and that he is a man worthy of trust of the shipowner Art. 617. 621. should there be one. interest. 8 and 9 of Article 580. and shall be subject to the provisions of the Penal Code. he shall apply to the judge or court if he is in Philippine territory. in order that it may be recorded in the registry when the vessel returns to the port of her registry. pro vided no money has been previously borrowed on the whole vessel. A captain who borrows money on the hull. engine. When he is permitted to do so. The captain may not contract loans on respondentia secured by the cargo. interest. and provided there does not exist any other kind of lien or obligation chargeable against the vessel. and costs shall be charged to the private account of the captain. In case of violation of this article the principal. The lack of this formality shall make the captain personally liable to the creditors who may be prejudiced through his fault. and costs. Art. and otherwise to the Filipino consul. Notes: Obligations covered by this article : (1) price which has not been paid to the last vendor. If the ship being on a voyage the captain should find it necessary to contract one or more of the obligations mentioned in Nos. He who commits fraud in his accounts shall reimburse the amount defrauded. the consul or the local authority as the case may be in view of the result of the proceedings instituted. and shall indemnify for the damages he may cause. 583. Art. or tackle of the vessel. by reason of the sale of the vessel by virtue of a declaration of unseaworthiness. or who pledges or sells merchandise or provisions outside of the cases and without the formalities prescribed in this Code. and in his absence to the judge or court or to the proper local authority. shall be liable for the principal. rigging. he must necessarily state what interest he has in the vessel. Neither may he borrow money on bottomry for his own transactions. and should he do so the contract shall be void. except on the portion of the vessel he owns. and the ship agent may furthermore discharge him. (2) for materials and labor in the construction of the vessel. or so that it can be admitted as a legal and preferred obligation in case of sale before the return. presenting the certificate of the registry of the vessel treated of in Article 612. shall make a temporary memorandum in the certificate of their result. PAGE 119 . The judge or court. and the instruments proving the obligation contracted.
stating in the said document that they were read. equipment and provisioning with the victuals and fuel. in virtue of which one person binds himself to perform or to do the services or PAGE 120 . it shall be admitted as evidence in questions which may arise between the captain and the crew with regard to the agreements contained therein and the amounts paid on account of the same. he may make up the crew with foreigners. necessary for the management. of the agreement and of the liquidation of his wages. (5) insurance premiums under Art. If the book includes the requisites prescribed in Article 612. Other Officers and Crew notes: Art. If in foreign ports the captain should not find a sufficient number of Filipino sailors. signed by the latter. and other employees. The agreements which the captain may make with the members of the crew and others who go to make up the complement of the vessels. as they appear in the book. Every member of the crew may demand of the captain a copy. stating therein all the obligations which each one contracts and all the rights they acquire. 626 . from the captain to the cabin boy. engineers. 8 and 9. (4) loan on bottomry before departure of the vessel. The captain may make up his crew with the number he may consider advisable. and there should not appear any signs of alterations in its entries.633 : second mate or third in command Complement of a vessel or crew . which will not give rise to doubts or claims. the number thereof not to exceed one-fifth of the total crew. 3. with the consent of the consul or marine authorities. maneuvers. and service.all the persons on board. signed by the parties thereto. 634. and vised by the marine authority if they are executed in Filipino territory. The captain shall take care to read to them the articles of this Code which concern them. stokers. to which reference is made in Article 612 (obligations inherent in the office of captain) must be reduced to writing in the account book without the intervention of a notary public or clerk of court.631 : sailing mate or second in command Art. (a) Contracts and formalities Art. 580 pars. said authorities taking care that these obligations and rights are recorded in a concise and clear manner.TRANSPORTATION AND MARITIME LAW (3) for the repair. or by the consuls or consular agents of the Philippines if executed abroad. 632 . Notes: The contract with a seaman has the nature of a lease of service. and in the absence of Filipino sailors he may ship foreigners residing in the country. includes the sailing mates.
PAGE 121 . A captain who. with the exception of that provided in Article 644. The perpetration of a crime which disturbs order on the vessel. (c) Rights Art. the sailor who has signed for one vessel should sign for another one. Art. 635. 3. shall be personally liable to the captain of the vessel to which the sailor first belonged for that part of the indemnity. 4. Neither can he pass from the service of one vessel to another without obtaining the written consent of the vessel on which he may be. and the captain may choose between forcing him to fulfill the service to which he first bound himself or look for a person to substitute him at his expense. Any occurrence which incapacitates the sailor to perform the work entrusted to him. the following being considered as such: 1. should have made a new agreement with him. Neither may the captain discharge a sailor during the time of his contract except for just cause. want of discipline. 5. 2. If. Repeated insubordination. Incapacity and repeated negligence in the fulfillment of the service which he should render. without obtaining said permission. Should there be no fixed period for which a sailor has been contracted. which the sailor may not be able to pay.TRANSPORTATION AND MARITIME LAW works for which he has signed himself in the vessel in consideration of the compensation stipulated (b) Duties and liabilities Art. he cannot be discharged until the end of the return voyage to the port where he enlisted. the second contract shall be void. knowing that a sailor is in the service of another vessel. Habitual drunkenness. Said sailor shall furthermore lose the wages earned on his first contract to the benefit of the vessel for which he may have signed. 637. without having requested the permission referred to in the foregoing paragraphs. or nonfulfillment of the service. 636. A sailor who has been contracted to serve on a vessel cannot rescind his contract nor fail to comply therewith except by reason of a legitimate impediment which may have occurred. referred to in the third paragraph of this article.
which shall be obligatory to the captain. the seaman shall be attended and cured at the expense of the common funds deducting. If the sickness should comee from an injury received in the service or defense of the vessel. in the form of a loan. the captain may not abandon any member of his crew on land or on the sea. it shall be paid by the captain personally. and during the same and until the conclusion thereof. in the judgment of the experts. Art. and if the proposed voyage should be of such short duration that it is calculated at approximately one month. after the crew has been engaged. or if the vessel is for the same reason given a different destination from that fixed in the agreement with the crew. in accordance with his contract. If the revocation of the voyage should be decided before departure of the vessel from the port. 644. before anything else. discounting in all cases the sums advanced. Should this not be the case. PAGE 122 . If the agreement should have been for a fixed amount for the whole voyage. the costs of the attendance and cure shall be defrayed from the common funds. according to the following cases: 1. the indemnity shall be fixed at fifteen days. If. however.TRANSPORTATION AND MARITIME LAW Art. The captain may. each sailor engaged shall be given one month's salary. After the voyage has begun. 638. unless the sickness is the result of his own fault. 2. in the manner established by the law of civil procedure. Desertion. the voyage is revoked by the will of the ship agent or of the charterers. At any rate. as the accused of a crime. before or after the vessel has put to sea. for the services rendered to the vessel up to the date of the revocation. The indemnity shall be paid from the funds of the vessel if the captain should have acted for reasons of prudence and in the interest of the safety and good service of the vessel. what may be due for said month and days shall be determined in proportion to the approximate duration of the voyage. refuse to permit a sailor whom he may have engaged to go on board. before setting out on a voyage and without giving any reason whatsoever. and may leave him on land. A seaman who falls sick shall not lose his right to wages during the voyage. in which case his wages have to be paid as if he had rendered services. besides what may be due him. unless. his imprisonment and delivery to the competent authority in the first port touched should be proper. the latter shall be indemnified on account of the rescission of the contract. from the proceeds of the freightage the cost of the attendance and cure. 6.
the sailors engaged for a fixed amount for the voyage shall receive the entire salary which may have been offered them if the voyage had terminated. 2. and any of the first three causes mentioned in the foregoing article should occur. should give rise to an increase of wages. Art. after a voyage has been begun. the sailors shall be paid at the port which the captain may deem PAGE 123 . Should the revocation or change of the voyage originate from the shippers or charterers. The blockade of the port of its destination or the breaking out of an epidemic after the agreement. If they accept the change. the members of the crew shall no other right than to collect the wages earned up to the day the revocation was made. The detention or embargo of the same by order of the government.TRANSPORTATION AND MARITIME LAW 3. 4. and the members of the crew should not agree thereto. 640. or for any other reason independent of the will of the agent. If. to pay said sailors in both cases the passage to the said port or to the port of sailing of the vessel. and the voyage. the latter shall be adjusted privately. 4. The inability of the vessel to navigate. as may be convenient for them. on account of greater distance or of other reasons. the captain being obliged. 3. Art. 5. 639. and those engaged by the month shall receive the amount corresponding to the time they might have been on board and to the time they may require to arrive at the port of destination. 641. this shall not give rise to a reduction in the wages agreed upon. or through friendly adjusters in case of disagreement. Art. the ship agent shall have a right to demand of them the indemnity which may be justly due. If the revocation should take place after the vessel has put to sea. Even if the voyage should be shortened to a nearer point. If the ship agent or the charterers of the vessel should give it a destination different from that fixed in the agreement. furthermore. they shall be given by way of indemnity half the amount fixed in the first case. The prohibition to receive in said port the goods which make up the cargo of the vessel. The following shall be just causes for the revocation of the voyage: 1. and the vessel should not have left the port. in addition to what may be due them for the part of the monthly wages corresponding to the days which may have elapsed from the date of their agreements. A declaration of war or interdiction of commerce with the power to whose territory the vessel was bound. Should the revocation of the voyage arise from a just cause independent of the will of the ship agent and the charterers.
Art. delay. the costs of medical attendance and treatment shall be defrayed from the common funds. If a portion of the vessel or of the cargo. the contract shall be rescinded and the crew shall be paid what they should have earned according to the contact. they shall be given from the amount of the salvage an award in proportion to the efforts made and to the risks encountered in order to accomplish the salvage. the contract must be complied with in the terms agreed upon. but only on the portion of the freightage saved. In the fifth case. the captain and the crew may mutually demand the enforcement of the contract. or of both. if the agreement is by month. engineer. to anything but the proportionate part of the indemnity which may be paid to the common funds by the persons responsible for said occurrences. but if the detention should exceed three months. all rights shall be extinguished. If the sickness should be caused by an injury received in the service or defense of the vessel. both as regards the right of the crew to demand any wages and as regards the right of the ship agent to recover the advances made. or sailing mate. At any rate. the crew shall continue to be paid half wages. as far as possible. as if the voyage had been made. In case of the occurrence of the fourth cause. the sailor shall be attended and treated at the expense of the common funds. If the crew has been engaged on shares it shall not be entitled. they shall indemnify the crew for the damages suffered. If the vessel and her cargo should be totally lost by reason of capture or shipwreck. 644. before PAGE 124 . unless his sickness is the result of his own fault. shall retain their rights on the salvage. Art. the crew shall have no other right than to collect the wages earned. by reason of the revocation. the crew engaged on wages. but sailors who are engaged on shares shall have no right on the salvage of the hull. or greater extension of the voyage. A sailor who falls sick shall not lose his right to wages during the voyage. but if the vessel is to continue its voyage. And if the agreement should be for a fixed sum for the voyage. deducting. according to the time they may have served thereon. in the form of a loan. 642. including the captain. (If they should have worked to recover the remainder of the shipwrecked vessel. on the remainder of the vessel as well as on the value of the freightage or the cargo saved. 643. always without prejudice to the criminal liability which may be proper. should be saved.TRANSPORTATION AND MARITIME LAW advisable to make for the benefit of the vessel and cargo. but if the disability of the vessel should have been caused by the negligence or lack of skill of the captain.) Art.
645. and freightage shall be liable for the wages earned by the crew engaged per month or for the trip. the heirs shall be paid the entire portion due the sailor. before the beginning of the voyage. credits of such kind pertaining to the preceding voyage shall lose the preference. or there occurs a naval war with the power to which the vessel was destined. If. the liquidation and payment to take place between one voyage and the other. the heirs shall not be entitled to claim anything. Art. And if the contract was on shares and the death occurred after the voyage was begun. If a sailor should die during the voyage. 3. from the proceeds of the freightage. Art. The sailor shall likewise be considered as present if he was captured while defending the vessel. that which may have been earned up to the date of his death shall be paid. he shall only receive the wages due up to the day of his capture. the full amount of wages or the entire part of the profits which may be due him as others of his class. If the vessel should change owner or captain. 646. the sailor shall be considered as living. equipment. Art. If the contract was for a fixed sum for the whole voyage. If death occurred in the defense of the vessel. namely --If he died a natural death and was engaged on wages. according to his contract and the cause of his death. if they deem if proper. // After a new voyage has been undertaken. at the end of the voyage. and his heirs shall be paid. the cost of the attendance and treatment. the captain attempts to change it. but if the latter died before the departure of the vessel from the port. The officers and the crew of the vessel shall be exempted from all obligations contracted. 2. in order to enjoy the benefits as the rest.TRANSPORTATION AND MARITIME LAW anything else. but should he have been captured on account of carelessness or other accident not related to the service. in the following cases. and the whole amount if he died on the return voyage. rigging. his heirs shall be given the wages earned and not received. 647. The vessel with her engines. If a disease should break out and be officially declared epidemic in the port of destination. Supercargoes PAGE 125 . 4. half the amount earned shall be paid if the sailor died on the voyage out. 1.
unless there is a special authorization therefor from the principals. Supercargoes cannot. All damages or deterioration which the vessel may suffer from the time it puts to sea at the port of departure until it casts PAGE 126 . with the exception of the ventures which. 650. AND ACCIDENTS OF MARITIME COMMERCE 1. with regard to that part of the administration legitimately conferred upon the latter. buys cargo to be brought back on the return voyage of the ship. D. 806. All extraordinary or accidental expenses which may be incurred during the voyage for the preservation of the vessel or cargo. make any transaction for their own account during the voyage. Now governed by the provisions on agency Art. but shall continue in force for all acts which are inseparable from his authority and office. they shall keep an account and record of their transactions in a book which shall have the same conditions and requisites as required for the accounting book of the captain. they are permitted to do. 649. manner of making contracts. sells the same to the best advantage in the foreign markets. 651. and liabilities of factors shall be applicable to supercargoes. in accordance with the custom of the port of destination. Accidents and Damages in Maritime Commerce RISKS. or both. and comes home with it Art. Supercargo: An agent of the owner of the goods shipped as cargo on a vessel. For the purposes of this Code the following shall be considered averages: 1. Averages (a) Nature and Kinds Art. without special authorization or agreement. All the provisions contained in the second section of Title III. and shall respect the latter in his duties as chief of the vessel. Supercargoes shall discharge on board the vessel the administrative duties which the agent or shippers may have assigned them. when there is a supercargo. Neither shall they be permitted to invest in the return trip more than the profits from the ventures. who has charge of the cargo on board. DAMAGES. Book II.TRANSPORTATION AND MARITIME LAW Art. with regard to qualifications. 2. The powers and liabilities of the captain shall cease.
The losses suffered by the cargo from the time of its embarkation until it is unloaded. until the merchandise is placed on the wharf. extraordinary or accidental b. Averages shall be: 1. Art. 807. 2. and the expenses incurred to avoid and repair the same. quarantine lazaretto. Expenses : to constitute an average. simple or particular averages include all the expenses and damages caused to the vessel or to her cargo which have not inured to the common benefit and profit of all the persons interested in the vessel and her cargo. cargo or both 2. incurred during the voyage c. and other so-called port expenses. such as those of pilotage of coasts and ports. inspection. an expense must be: a. Damages or deterioration : to constitute an average. anchorage. The petty and ordinary expenses incident to navigation. lighterage and towage. health. Art. especially the following: 1. have been suffered from the time the vessel puts to sea from the port of departure until it casts anchor in the port of destination b. General or gross. Averages consist of 2 items : 1. incurred in order to preserve the vessel. it must be: a. unless there is an express agreement to the contrary. 809. and those suffered by the merchandise from the time they are loaded in the port of shipment until they are unloaded in the port of their consignment. have been suffered by the merchandise from the time they are loaded in the port of shipment until they are unloaded in the port of consignment (1) Simple or Particular (a) Defined Art. As a general rule. PAGE 127 . and unloading. 808. costs of barges. Simple or particular.TRANSPORTATION AND MARITIME LAW anchor at the port of destination. and other usual expenses of navigation shall be considered ordinary expenses to be defrayed by the shipowner. either on account of the inherent defect of the goods or by reason of a marine accident or force majeure.
The lowest value of the goods sold by the captain in arrivals under stress for the payment of provisions and to save the crew. and equipments. privateers. from a real and known risk. if the marine ordinances allow it.TRANSPORTATION AND MARITIME LAW 2. The losses and expenses suffered by the vessel in its hull. Any loss suffered by the cargo through the faults. 9. 6. except in coastwise navigation. If the accident should occur through the fault or negligence of the captain. 3. general or gross averages shall include all the damages and expenses which are deliberately caused in order to save the vessel. 810. The victuals and wages of the crew while the vessel is in quarantine. its cargo. As a general rule. PAGE 128 . 7. and the provisions. negligence. if the charter has been contracted for a fixed sum for the voyage. or both at the same time. in order to make repairs or secure provisions. rigging. to meet any other need of the vessel against which the proper amount shall be charged. from the time it puts to sea from the port of departure until it anchors in the port of destination. The losses suffered by the merchandise loaded on deck. arms. The necessary expenses on arrival at port. the latter shall be liable for all the damage caused. 811. Distinguishing feature : an expense incurred or damage suffered which has not inured to the common benefit and profit of all persons interested in the vessel and its cargo (b) Effects Art. 8. The wages and victuals of the crew when the vessel is detained or embargoed by a legitimate order or force majeure. wages. 5. The owner of the goods which gave rise to the expense or suffered the damage shall bear the simple or particular averages. or barratry of the captain or of the crew. and the freight. without prejudice to the right of the owner to recover the corresponding indemnity from the captain. or pirates. and expenses of the vessel detained during the time the settlement or redemption is being made. the vessel. and particularly the following: 1. The loss inflicted upon the vessel or cargo by reason of an impact or collision with another. The goods or cash invested in the redemption of the vessel or of the cargo captured by enemies. if it is accidental and unavoidable. (2) Gross or General (a) Defined Art. 4. for the same causes and reasons.
the anchors and the chains which are abandoned. scuttled or broken in order to save the cargo.TRANSPORTATION AND MARITIME LAW 2. The damage caused to the vessel which had to be opened. the owner of said part shall be entitled to indemnity. in order to facilitate its entry into a port or roadstead. 7. The expenses of removing or transferring a portion of the cargo in order to lighten the vessel and place it in condition to enter a port or roadstead. 11. during the time that it is embargoed or detained by force majeure or by order of the Government. The goods jettisoned to lighten the vessel. If. 818. or in order to repair the damage caused for the common benefit. If in the lightening a vessel on account of a storm. to the vessel. Art. The wages and victuals of the crew of a vessel chartered by the month. whether they belong to the cargo. as if the loss had originated from a gross average. should he prefer it. in order to save the cargo. this loss shall be considered gross average. and the damage resulting therefrom to the goods removed or transferred. The expenses for the treatment and subsistence of the members of the crew who may have been wounded or crippled in defending or saving the vessel. 3. 5. privateers. on the contrary. the amount thereof being distributed between the vessel and cargo from which it came. the merchandise transferred should be saved and the vessel should be lost. and the necessary expenses which he may incur in his imprisonment. or both. part of her cargo should be transferred to lighters or barges and be lost. until he is returned to the vessel or to his domicile. If. 4. Art. 8. The damage suffered by the goods of the cargo by the opening made in the vessel in order to drain it and prevent its sinking. 817. or to the crew. and the damage suffered through said act by the goods which are kept on board. or bay. The depreciation resulting in the value of the goods sold at arrivals under stress in order to repair the vessel by reason of gross average. PAGE 129 . 12. to which the vessels saved shall contribute. creek. The cables and masts which are cut or rendered useless. 10. it should be decided to sink any vessel. no liability may be demanded of the salvage. the vessel. The expenses of the liquidation of the average. or pirates. as a necessary measure to extinguish a fire in port. The wages of any member of the crew held as hostage by enemies. 9. roadstead. 6. The expenses caused in order to float a vessel intentionally stranded for the purpose of saving it.
there must be a resolution of the captain. its cargo or both from a real and known risk --> it is the deliverance from an immediate peril. 814. being on board the vessel. and the captain and officers or a majority of them. lack of skill. if possible. have not been heard. stating the motives and reasons on which it is based. by a common sacrifice. In order to incur the expenses and cause the damages corresponding to gross average. they shall not contribute to the gross average. Art. from the expenses or damages caused follows the successful saving of the vessel and cargo 4. should there be any. that constitutes the essence of general average Requisites for general average: 1. If the persons interested in the cargo. there must be a common danger --> the ship and cargo are subject to the same danger and that the danger arises from accidents of the sea. In the second case. and the irresistible and urgent causes which impelled the captain if he acted of his own accord. PAGE 130 . In the first case the minutes shall be signed by all the persons present who could do so before taking action. dispositions of the authorities or faults of men. and if not. the votes against it and the reason for the dissent. for the common safety. the expenses or damages should have been incurred or inflicted after taking legal steps and authority (b) Essential Requisites Art. provided that the circumstances producing the peril should be ascertained and imminent 2. without prejudice to the right of the shippers to proceed against the captain before the competent judge or court. and after hearing the persons interested in the cargo who may be present. their share being chargeable against the captain. it shall be signed by the captain and by the officers of the vessel. if they can prove that he acted with malice. 813. or negligence. unless the urgency of the case should be such that the time necessary for previous deliberation was wanting. at the first opportunity. if opposed to the majority. they may be executed under his responsibility. or the captain. The resolution adopted to cause the damages which constitute general average must necessarily be entered in the log book. part of the vessel or the cargo or both is sacrificed deliberately 3. adopted after deliberation with the sailing mate and other officers of the vessel.TRANSPORTATION AND MARITIME LAW Distinguishing feature: Expense or damage suffered deliberately in order to save the vessel. If the latter should object. should consider certain measures necessary.
The owners of the goods saved shall not be liable for the indemnification of those jettisoned. vs Agan 96 Phil. The following are the requisites for a general average: 1) there must be common danger. 860.TRANSPORTATION AND MARITIME LAW In the minutes. ropes. PAGE 131 . shall be stated in detail all the goods jettisoned. the minutes shall be signed by the parties 5. and mention shall be made of the injuries caused to those kept on board. The captain shall be obliged to deliver one copy of these minutes to the maritime judicial authority of the first port he may make. and equipment. 6 of Art. 809 . that is. and after the resolution. there must be a resolution of the captain 3. but it specifically refers to a vessel intentionally stranded for the purpose of saving it. he shall deliver one copy of these minutes to the maritime judicial authority thereat Art. within twenty. and to ratify it immediately under oath. notwithstanding the jettison of the merchandise. within 24 hours upon arrival at the first port the captain makes. 811 mentions expenses caused to afloat a vessel. the Code of Commerce at the same time enumerate certain specific cases as coming specially under one or the other class. breakage of masts.referring to expenses suffered by the vessel due to an accident of the sea or force majeure. The goods that were not sacrificed shall not be liable for the indemnification of those sacrificed One of the requisites of general average is lacking. the vessel should be lost running same risk. with the reasons and motives and the votes for and against the resolution 4. Formalities for incurring gross average : 1. 2 of Art. 2) for the common safety part of the vessel or cargo or both is sacrificed deliberately. there must be an assembly of the sailing mate and other officers with the captain including those with interests in the cargo 2. the resolution shall be entered in the log book. 504 Held: In classifying averages into simple or particular and general or gross and defining each class.said expenses do not fit into any of the specific cases of general average enumerated in ART. If. No. no contribution whatsoever by reason of gross average shall be proper. 811. 3) from the expenses or damages caused follows the successful saving of the vessel and cargo. success in saving the vessel and remaining cargo Magsaysay Inc. and would have no application where the stranding was unintentional.four hours after his arrival. lost or damaged. While the expenses incurred in putting the vessel afloat may well come under No. and 4) the expenses or damages should have been incurred or inflicted after taking the proper legal steps and authority.
the expenses incurred in floating the vessel do not constitute general average. and it cannot be said that under the conditions existing at the time when the master elected to flee from that port. liable for the cost of forwarding the cargo by another line. though not inevitable. Where there is no proof that the stranded vessel had to be put afloat to save it from imminent danger. they were not liable to forfeiture in the event of capture by the enemies of the ship's flag. There was no common danger to the ship and cargo.and not for the purpose of saving the cargo. the cargo owners are not in law bound to contribute to expenses. was a possible outcome of a failure to leave the port of Saigon. The outbreak of the war between Germany and Russia absolved the defendant from conveying the cargo to Russia. and no damage could be recovered by the plaintiff from the defendant for the latter's failure to convey the cargo to the port of destination on that ship. not necessarily by a streamer of defendant. But by the terms of the contract of affreightment. Defendant is. therefore. Judgment affirmed. The refloating was a success.to enable it to proceed to its destination -. he acted exclusively with a view to the vessel's protection. Decision reversed. by reason of a common sacrifice. It follows that when the master of the vessel decided to take refuge in Manila. it was not a case for a general average. The expenses incurred for the common safety of the vessel and cargo in this case did not arise from the imminent peril of both. 913. therefore. that constitutes the essence of a general average. the defendant was bound to forward the cargo to Vladivostok at its expense. The final requisite has not been proved for it does not appear that the expenses in question were incurred after following the procedure laid down in Art. and what does appear is that the vessel had to be salvaged in order to enable it to proceed to its port of destination. It is not claimed that said cargo was contraband of war and being neutral goods. International Harvester vs Hamburg American Line 42 Phil 845 Held: It is clear that the cargo in question is not liable to a general average. It does not by any means follow that it is not liable for the expenses incurred by the plaintiff in completing the unfinished portion of the voyage in another ship. Compagnie de Commerce vs Hamburg 36 Phil 590 Held: The danger from which the master of the vessel fled was a real and not merely an imaginary one. Seizure at the hands of the enemy. It is the safety of the property. and. The cargo could have been unloaded by the owners had they been required to do so.TRANSPORTATION AND MARITIME LAW It is the deliverance from an immediate peril. there were no grounds for a reasonable PAGE 132 . the full freight having been received by the ship at the commencement of the voyage. and not of the voyage which constitutes the true foundation of general average. but as the sacrifice was for the vessel's benefit -.
815. from the route prescribed in her charter party.TRANSPORTATION AND MARITIME LAW apprehension of danger from seizure by French authorities. and the subsequent abandonment by the master of the voyage contemplated in the contract of affreightment. It is very clear that in fleeing from the port of Saigon and taking refuge in Manila. 2. however. and there can be no question that the flight of the vessel was a measure of precaution adopted solely and exclusively for the preservation of the vessel from danger of seizure or capture. all the persons having an interest in the vessel and cargo therein at the time of the occurrence of the average shall contribute. The captain shall direct the jettison. the heaviest ones with the least utility and value. Art. but recovery of damages by plaintiff should be reversed. An examination of the entire body of these rules discloses that general average is never allowed thereunder unless the loss or damage sought to be made good as general average has been incurred for the `common safety'. to the amount and number absolutely indispensable. cannot be sustained under the provisions of the York-Antwerp Rules. 816. In order to satisfy the amount of the gross or general averages. Judgment modified. the master of the vessel was not acting for the common safety of the vessel and her cargo. must be held to have been justified by the necessity under which the master was placed to elect that course which would remove and preserve the vessel from danger of seizure by the public enemy of the flag which the vessel sailed. always beginning with those of the greatest weight and smallest value. (c) Effects Art. In order that the goods jettisoned may be included in the gross average and the owners thereof be entitled to indemnity. Defendant cannot claim for general average. The claim for general average by the shipowner. beginning with those which embarrass the maneuver or damage the vessel. (d) Jettison Art. Delivery of the net proceeds of the sale to plaintiff should be affirmed. and that neither the vessel nor her owners are liable for the resultant damages suffered by the owner of the cargo. The French cargo was absolutely secure from danger of seizure or confiscation so long as it remained in the port of Saigon. and shall order the goods cast overboard in the following order: 1. 812. by means PAGE 133 . Those which are below the upper deck. and with regard to those belonging to the vessel. if possible. it shall be necessary in so far as the cargo is concerned that their existence on board be proven by means of the bill of lading. and therefore no necessity for flight. The deviation of the vessel therefore. Those which are on deck. preferring.
Those interested in the proof and liquidation of averages may mutually agree and bind themselves at any time with regard to the liability. 2. Rule D. as well as when a judicial authority intervenes at the request of any of the parties interested who do not agree thereto. according to the laws of the country and for the account of the proper party. all of them shall be cited and heard. If the average has occurred near the port of destination. York-Antwerp Rules Rights to contribution in general average shall not be affected. If the average occurred outside of the jurisdictional waters of the Philippines. so that said port can be made. the proceedings mentioned in rules 1 and 2 shall be held there. The proof of the average shall take place in the port where the repairs are made. or the cargo has been sold in a foreign port by reason of an arrival under stress. or in the port of unloading. (e) Jason Clause Jason Clause. 847. (b) Proof and Liquidation of Averages (1) Modes Art. When the representative is a person well known in the place where the liquidation is made. 4. the following rules shall be observed: 1. the liquidation shall be made in the port of arrival. and where there is none. In the case where the liquidation of the averages is made privately by virtue of agreement. Art. if it is a Philippine port. should they not have renounced this right. In the absence of agreements. The liquidation shall be made in the port of unloading. Should they not be present or should they have no legal representative. should any be necessary. 846.TRANSPORTATION AND MARITIME LAW of the inventory prepared before the departure. liquidation and payment thereof. in accordance with the first paragraph of Article 612. 3. his intervention shall be admitted PAGE 134 . by the competent judge or court. but this shall not prejudice any remedies which may be open against that party for such fault. though the event which gave rise to the sacrifice or expenditure may have been due to the fault of one of the parties to the adventure. the liquidation shall be made by the consul in a foreign port.
If by reason of one or more accidents of the sea. PAGE 135 . 851. the adjustment. 848. particular and gross averages of the vessel. Art. of the cargo. also stating separately whether or not there are damages proceeding from inherent defect of the thing and not from accident of the sea. At the instance of the captain. and should there be none. or utilized. within forty-eight hours. and distribution of gross averages shall be held privately. should take place on the same voyage. deducting in both cases the expenses of appraisal. with the consent of all the parties in interest. the captain shall convene all the persons interested in order that they may decide as to whether the adjustment or liquidation of the gross average is to be made by experts and liquidators appointed by themselves. following the arrival of the vessel at the port. 850. the expenses and damages corresponding to each average shall be determined separately in the port where the repairs are made. unless there is an agreement to the contrary. Claims for averages shall not be admitted if they do not exceed 5 per cent of the interest which the claimant may have in the vessel or in the cargo if it be gross average. sold. For this purpose. the shipper. the captain shall apply to the competent judge or court. to the local authority when they are to be held in a foreign port. or to the consul of the Philippines should there be one. the amount corresponding to each must be estimated and stated distinctly. even though he be authorized only by a letter of the ship agent. repair. or where the merchandise is discharged. (2) Appraisal of general average Art. and in case there should be expenses common to the different averages and to the vessel and its cargo. and 1 per cent of the goods damaged if particular average. that in their appraisements or estimates and accounts they set down separately and accurately the expenses and damages pertaining to each average. Art. If an agreement is not possible. sale. as well as of those appraising and taking part in the unloading. or the insurer. in which case did shall be so done if the interested parties agree. or utilization of the merchandise. liquidation. or of both. For this purpose the captains shall be obliged to demand of the expert appraisers and of the contractors making the repairs. who shall be the one in the port where these proceedings are to be held in accordance with the provisions of this Code.TRANSPORTATION AND MARITIME LAW and shall produce legal effects. and in those of each average those corresponding to the vessel and to the cargo.
852. separating these losses and damages from those arising from the inherent defect of the things. they shall proceed to the examination of the vessel and of the repairs required and to the appraisal of their cost. unless there is an agreement to the contrary. With regard to the merchandise. PAGE 136 .TRANSPORTATION AND MARITIME LAW Art. After the experts have been appointed by the persons interested. Under Art. the examination thereof must be made before they are delivered. the ship agent or the shippers shall demand the liquidation. if the average should be visible at a mere glance. The experts shall also declare whether the repairs may be made immediately. Art. the value of the merchandise loaded shall be determined by the purchase price. liquidation and distribution of any gross average. the shipowner or shipper has the right to maintain an action against the captain for indemnification for the loss --> this does not involve the suppression of the right of action of the shipper against the shipowner Art. customs duties. without taking the bills of lading into consideration. The merchandise saved which is to contribute to the payment of the gross average shall be valued at the current price at the port of unloading. including the expenses until they are placed on board. or whether it is necessary to unload the vessel in order to examine and repair it. 3. deducting the freightage. the captain is required to initiate the proceedings for the adjustment. provided that it is done within forty-eight hours from the unloading. said examination may be made after the delivery. 854. it is his duty to take the proper steps to protect any shipper whose goods may have been jettisoned for the general safety ==> if the captain does not comply with his duty under 851. and after the acceptance. it shall be appraised at its true value. and without prejudice to the other proofs which the experts may deem proper. 851. without prejudice to the action they may bring to demand indemnity from him. The valuation of the objects which are to contribute to the gross average. or by the court. If the captain does not comply with the provisions of the preceding article. Should it not be visible at the time of unloading. and that of those which constitute the average. the insurance premium excluded. 2. and expenses of unloading. shall be subject to the following rules: 1. If the liquidation is to be made in the port of departure. If the merchandise should be damaged. as may appear from a material inspection of the same. 853.
which constitutes the gross average. cables. Art. the captain does so at his own risk. the merchandise should have been sold in a foreign port. shall be appraised at the current value. In any case the shipowner and the captain shall be liable to the shippers for the damages from the jettison. provided that its kind and quality appear in the bill of lading. adding thereto the expenses and freightage subsequently arising. the value of the merchandise in the port of arrival. The same shall take place with that which is on board and is not included in the bills of lading or inventories. shall be appraised at the value which merchandise of its kind may have in the port of unloading. This deduction shall not be made with respect to anchors and chains. The merchandise loaded on the upper deck of the vessel shall contribute to the gross average should it be saved. If the voyage having been interrupted. except when the marine ordinances allow its shipment in this manner in coastwise navigation. he takes the risk upon himself of the perils arising from the dangers of the sea and any damage will be borne by the owner [particular average] --> if stowed on deck without his consent. 5. the value shall be that stated in the invoices of the purchase issued in the port of shipment. 7. and should they not appear. deducting one-third by reason of the difference between new and old. The masts cut down. but there shall be no right to indemnify if it should be lost by reason of having been jettisoned for common safety.TRANSPORTATION AND MARITIME LAW 4. and other equipment of the vessel rendered useless for the purpose of saving it. or the net proceeds obtained at the sale thereof. PAGE 137 . The freightage shall represent 50 per cent by way of contributing capital. 8. 855. Merchandise lost. if the storage on the upper deck was made without the consent of the latter. 6. shall be taken as the contributing capital. The vessel shall be appraised at its true value in the condition in which it is found. The goods may be stowed on deck (1) with the consent of the shipper or (2) without his consent --> if stowed on deck with his consent. according to the cases. the sails. and the average cannot be estimated. the captain cannot protect himself by showing that they are damaged or lost by dangers of the sea The carriage of gasoline on deck by coastwise or interisland vessels is allowed by marine regulations --> the loss of petroleum for common safety and benefit will constitute a general average.
after an examination of the liquidation and a hearing of the persons interested who may be present or of their representatives. Art. the repairs. in accordance with the rules established in Article 854. 857. The contributing capital. and otherwise he shall include it in the exordial of the liquidation. it shall be distributed pro rata among the goods which are to cover the same. has been concluded by the experts. 867. 3. if necessary. and he shall be liable to the owners of the goods averaged for the damages they may suffer through his delay or negligence. That of the vessel in its actual condition. The distribution of the gross average shall not be final until it has been agreed to. in order that he may proceed with the distribution of the average. the entire record shall be turned over to the liquidator appointed. it shall be the duty of the captain to collect the amount of the contribution. or in the absence thereof. he shall call attention thereto in order that it may be corrected. After the amount of the gross average has been determined in accordance with the provisions of this Code. If. deducting the remaining 50 per cent for wages and maintenance of the crew. the accounts of the same approved by the persons interested or by the judge or court. Art. until it has been approved by the judge or court. Immediately thereafter he shall proceed with the distribution of the amount of the average. If the persons contributing should not pay the amount of the contribution at the end of the third day after having PAGE 138 . Art. and. After the liquidation has been approved. the appraisements. he should find any defect in the procedure which might injure the rights of the persons interested or affect the liability of the captain. (3) Liquidation of general average Art. if any. with the log book. the liquidator shall examine the protest of the captain.TRANSPORTATION AND MARITIME LAW Art. comparing it. 865. made on the vessel. if possible. and accounts of repairs made. In order to effect the liquidation. according to a statement of experts. as a result of this examination. which he shall determine by the value of the cargo. 866. After the appraisement of the goods saved and of those lost which constitute the gross average. The 50 per cent of the amount of the freightage. and all the contracts which may have been made among the persons interested in the average. for which purpose he shall fix: 1. in this case. expert examinations. 858. 2.
Arrivals Under Stress (a) Causes Art. until payment has been made from their proceeds. the goods saved shall be proceeded against. in so far as applicable. and who may attend the meeting without the right to vote. and if. If the person interested in receiving the goods saved should not give security sufficient to answer for the amount corresponding to the gross average.TRANSPORTATION AND MARITIME LAW been required to do so. and the persons interested in the cargo may make the objections and protests they may deem proper. at the request of the captain. in the log book. 2. The captain shall have the deciding vote. shall proceed examination and appraisement of the averages in the prescribed in Articles 853 and 854. he shall assemble the officers and shall summon the persons interested in the cargo who may be present. which shall be signed by all. 869. 868. 869. shall proceed examination and appraisement of the averages in the prescribed in Articles 853 and 854. persons with the manner they are persons with the manner they are PAGE 139 . If during the voyage the captain should believe that the vessel cannot continue the trip to the port of destination on account of the lack of provisions. as the case may be. Rules 2 to 7. or by reason of any accident of the sea disabling it to navigate. Art. as the case may be. the arrival at the nearest and most convenient port shall be agreed upon. the reason should be considered well-founded. The experts whom the court or the interested may appoint. after examining the circumstances of the case. Art. 819. (4) Liquidation of particular average Art. which shall be entered in the minutes in order that they may make use thereof in the manner they may consider advisable. privateers. The experts whom the court or the interested may appoint. in so far as applicable. well-founded fear of seizure. Rules 2 to 7. the captain may defer the delivery thereof until payment has been made. or pirates. drafting and entering the proper minutes.
drafting and entering the proper minutes. or if they should have been rendered useless or lost through bad stowage or negligence in their care. If during the voyage the captain should believe that the vessel cannot continue the trip to the port of destination on account of the lack of provisions. An arrival shall not be considered lawful in the following cases: 1. which shall be signed by all 3. or pirates. and prepared in a manner suitable for the voyage. drafting and entering in the log book the proper minutes. if during the voyage the vessel cannot continue the trip to the port of destination due to : (1) lack of provisions. privateers.TRANSPORTATION AND MARITIME LAW Art. Formalities : 1. or by reason of any accident of the sea disabling it to navigate. the arrival at the nearest and most convenient port shall be agreed upon. rigged. (2) well-founded fear of seizure. and based on positive and provable facts. The captain shall have the deciding vote. or pirates should not have been well known. 819. If the risk of enemies. after examining the circumstances of the case. Whenever malice. (3) by reason of any accident of the sea disabling it to navigate (b) Formalities Art. If the lack of provisions should arise from the failure to take the necessary provisions for the voyage according to usage and custom. want of foresight. equipped. manifest. entry in the log book of the objections and protests of the persons interested in the cargo PAGE 140 . assembly of the officers including all interested parties 2. 820. and the persons interested in the cargo may make the objections and protests they may deem proper. or pirates. which shall be entered in the minutes in order that they may make use thereof in the manner they may consider advisable. in the log book. which shall be signed by all. he shall assemble the officers and shall summon the persons interested in the cargo who may be present. and if. or lack of skill on the part of the captain exists in the act causing the damage. 2. well-founded fear of seizure. and who may attend the meeting without the right to vote. privateers. Arrival under stress: Arrival of a vessel at the nearest and most convenient port. 3. If the defector the vessel should have arisen from the fact that it was not repaired. the reason should be considered well-founded. privateers. 4. or from some erroneous order of the captain. negligence.
provided the latter is legitimate. where there is one. In a foreign port. the expenses shall be for the account of the ship agent or owner. the captain must request authorization from the competent judge or court for the removal. it should be necessary to unload. and carry it out with the knowledge of the person interested in the cargo. where there is one. If in order to make repairs to the vessel or because there is danger that the cargo may suffer damage. it should be necessary to unload. 821. but they shall liable for the damages which may be caused the shippers by of the arrival. If the unloading should take place for both reasons. the unloading must be necessary to make repairs or there must be danger that the cargo may suffer damage 2. In a foreign port.TRANSPORTATION AND MARITIME LAW Art. it shall be the duty of the Filipino consul. In the first case. they shall be chargeable against the owners of the merchandise for whose benefit the act was performed. and carry it out with the knowledge of the person interested in the cargo. The expenses of an arrival under stress shall be for the account of the shipowner or agent. 822. the expenses shall be for the account of the ship agent or owner. Otherwise. should there be any. the captain must be authorized by either a competent court or the Phil. In the first case. and in the second. If in order to make repairs to the vessel or because there is danger that the cargo may suffer damage. it shall be the duty of the Filipino consul. If the unloading should take place for both reasons. to give the authorization. they shall be chargeable against the owners of the merchandise for whose benefit the act was performed. depending on the port of arrival PAGE 141 . and in the second. the expenses shall be divided proportionately between the value of the vessel and that of the cargo. always not be reason jointly Art. to give the authorization. the captain must request authorization from the competent judge or court for the removal. 822. the expenses shall be divided proportionately between the value of the vessel and that of the cargo. Requisites for the captain to unload the cargo arriving under stress: 1. consul. (c) Expenses Art. or his representative. the ship agent and the captain shall be liable. or his representative. should there be any.
Collisions Collision: impact of two vessels both of which are moving Allision: striking of a moving vessel against one that is stationary Cases of collision : 1. The captain shall be responsible for the damages caused by his delay. after an examination and declaration of experts. a deliberation and resolution in a meeting of the officers of the vessel and persons interested in the cargo who may be present. but as regards the owners of the cargoes. due to the fault of both vessels --> under 827. and other formalities required by the case. 823. the sale of all or of part of the former. or of the consul in a proper case. the shipowner shall be liable for the losses and damages 2. The captain has the duty to continue the voyage without delay after the cause of the arrival under stress has ceased--> otherwise. privateers. shall precede the departure. and the person taking cognizance of the matter shall authorize it. Art. The captain shall. both vessels shall be jointly and severally liable PAGE 142 . in accordance with the provisions contained in Article 819. or pirates. sailing mate or the complement of the vessel --> under 826. except in cases of force majeure. each vessel shall suffer its own losses. in accordance with the provisions of Article 624. 824. if after the cause of the arrival under stress has ceased. in a proper case. who shall be responsible for the same. 825. and an entry in the book. or there should be imminent danger of its being damaged. due to the fault. justify the legality of his conduct.TRANSPORTATION AND MARITIME LAW (d) Responsibility of Captain Art. the captain may request of the competent judge or court. under the penalty of answering to the shipper for the price the merchandise would have brought if it had arrived in good condition at the port of destination. advertisements. negligence or lack of skill of the captain. The custody and preservation of the cargo which has been unloaded shall be entrusted to the captain. he shall be liable for damages caused by the delay 3. Art. If the cause of the arrival should have been the fear of enemies. he should not continue the voyage. If the entire cargo or part thereof should appear to be damaged.
The vessel which is moored at a place not used for the purpose. the fault is presumed to be imputable to the one who arrived later. and both shall also be solidarily responsible for the losses and damages caused to their cargoes 4. The vessel which leaves later is presumed to have collided against one who has left earlier. 9.TRANSPORTATION AND MARITIME LAW 3. has the presumption against itself. collision due to fortuitous event or force majeure --> under 830. 6. the farther one must allow the nearer to enter first. a vessel which is properly anchored and moored may collide with those nearby by reason of a storm or other cause of force majeure --> under 832. the smaller should give the right of way to the larger one. A vessel leaving port should leave the way clear for another which may be entering the same port. the vessel run into shall suffer its own damages and expenses Nautical Rules to determine negligence : 1. unless it can be proved that there was no fault on its part. where it cannot be determined which of the 2 vessels is at fault --> under 828. 3. When 2 vessels are about to enter a port. or which has been left without watch. if they collide. 2. The vessel which is not properly moored or does not observe the proper distances. the owner of the third vessel causing the collision shall be liable for the losses and damages 6. 4. where two vessels collide with each other without their fault but by reason of the fault of a third vessel --> under 831. When 2 vessels meet. 7. Zones in time of collisions (3 time zones): PAGE 143 . has also against itself the presumption. even when the crew of the latter has received word to lift anchor. each vessel shall suffer its own losses. There is also a presumption against the vessel which sets sail at night. 5. and cannot move. each vessel shall bear its own damages 5. or which is improperly moored or does not have sufficient cables. 8. The presumption also works against the vessel with spread sails which collides with another which is at anchor. The same rule applies to those vessels which do not have buoys to indicate the location of its anchors to prevent damage to these vessels which may approach it. when there was not sufficient time to do so or there was fear of a greater damage or other legitimate reason.
no rule is applicable because none is necessary. and a collision results as a consequence. causing them damages. the time between the moment when collission has become a practical certainty and the moment of actual contact Effect of fault of privileged vessel during third zone : If a vessel having a right of way suddenly changes its course during the third zone. a vessel which is properly anchored and moored should collide with those nearby. 832. by reasons of a storm or other cause of force majeure. 830. Art. the time between the moment when the risk of collission begins and the moment when it has become a practical necessity. If. Each vessel is free to direct its course as it deems best with reference to the movements of the other vessel.TRANSPORTATION AND MARITIME LAW 1. If a vessel should collide with another through fortuitous event or force majeure. does not absolve the steamship which has suffered herself and a sailing vessel to get into such dangerous proximity as to cause inevitable harm and confusion. The steamer having a far greater fault in allowing such proximity to be brought about is chargeable with all the damages resulting from the collission. during the third division of time. and even if wrong. it has been held that fault on the part of the sailing vessel at the moment preceding a collission. that is. 3. such act may be said to be done in extremis. the injury occasioned shall be considered as particular average of the vessel run into. each vessel and its cargo shall bear its own damages. is not responsible for the result. Thus. 2. and the act of the sailing vessel having been done in extremis and even wrong. cannot create responsibility on the part of said vessel with the right of way. (a) Classes and Effects (1) Fortuitous Art. all the time up to the moment when the risk of collision may have said to have begun --> within this zone. in an effort to avoid an imminent collision due to the fault of another vessel. Each to his own damage --> particular damage (2) Culpable PAGE 144 .
Where the obligation arises from tortious act and not from contract. each one shall suffer its own damages. in case of collision between two vessels at sea. negligence. If the collision is imputable to both vessels. 827 and 828. or any other member of the complement. and both shall be solidarily responsible for the losses and damages occasioned to their cargoes. Relation of Art. If a vessel should collide with another. not only in the cse where both vessels may be shown to be actually blameworthy but also in the case where it is shown that only one ws at fault but the proof does not show it --> it makes no difference that the negligence imputable to the two vessels may have differed PAGE 145 . 827. both are solidarily liable for the loss of cargo carried by either to the full extent of the value thereof. 828. 828 must be considered an extension of Art. 826.831. The provisions of the preceding article are applicable to the case in which it cannot be determined which of the two vessels has caused the collision. after an expert appraisal. (3) Inscrutable Fault Art. 827 The rule of liability under Art. sailing mate. the owner of the third vessel shall indemnify the losses and damages caused. Defense of due diligence of a good father of a family in the selection and vigilance of the officers and crew cannot be used to render nugatory the solidary liability under 827 Under the express provisions of 827. 827 to Art. or lack of skill of the captain. 827 is applicable not only to the case where both vessels may be shown to be actually blameworthy but also to the case where it is obvious that only one was at fault but the proof does not show which Under Arts. through the fault. the captain thereof being civilly liable to said owner. 828 Art.TRANSPORTATION AND MARITIME LAW Art. If a vessel should be forced by a third vessel to collide with another. the shipowners cannot successfully maintain an action against the other for the loss or injury to his vessel Art. both the owner and the shipagent should be declared liable Art. the owner of the vessel at fault shall indemnify the losses and damages suffered.
If the vessels colliding with each other should have pilots on board discharging their duties at the time of the collision. In the cases above mentioned the civil action of the owner against the person causing the injury as well as the criminal liabilities. 829. are reserved. their presence shall not exempt the captains from the liabilities they incur. 834.TRANSPORTATION AND MARITIME LAW somewhat in character and degree and that the negligence of the sunken ship was somewhat more marked than that of the ther The doctrine of last clear chance cannot be raised --> under the express provisions of Art. shall be presumed as lost by reason of collision. Art. 587. 837. the indemnity due by reason of the death or injury of persons shall have preference. The civil liability incurred by the shipowners in the cases prescribed in this section. having been obliged to make a port to repair the damages caused by the collision. which may be proper. 827. (c) Liabilities (1) Shipowner or agent Art. pilot. upon being run into. When the value of the vessel and her appurtenances should not be sufficient to cover all the liabilities. 838. the owners of neither can successfully maintain an action against the other for the loss or injury to his vessel (b) Presumption of loss by collision Art. sinks immediately. 590 and 837] Damages may be recovered to the extent of what may be salvaged or of the freightage received or of the value of the insurance recoverable (2) Captain. Limited liability : limited to the value of the vessel and the freight earned during the voyage [provided for in Arts. under which the evidence disclosing that both vessels are blameworthy. is lost during the voyage or is obliged to be stranded in order to be saved. as well as that which. others Art. but the latter shall have the right to be indemnified by the PAGE 146 . A vessel which. Art.833. shall be understood as limited to the value of the vessel with all its appurtenances and freightage earned during the voyage.
835. the absence of a protest may not prejudice the persons interested who were not on board or were not in a condition to make known their wishes. 624 and 843. 836. forwarding the proceedings to the Secretary of the Department of Foreign Affairs for continuation and conclusion. in case of maritime collisions Art. (3) conditions. 4. 835 establishes a condition precedent before any action for the recovery of damages arising from collisions may be admitted --> presentation of a protest or declaration within 24 hours before the proper authorities [competent authority at the point where the collision took place or of the first port of arrival of the vessel or to the consul of the Philippines if it occurred in a foreign country] The requirement of protest is not necessary with respect to small boats engaged in river and bay traffic and boats manned by a group of fishermen Reason for requiring protest: Neccesity of preventing fictitious collisions and improper indemnities Summary of cases where protest is required: 1. under 612. under 612. if in Philippine territory and to the consul of the Philippines. Art. 839. where the vessel has gone through a hurricane or when the captain believes that the cargo has suffered damages or averages 4. under 624. without prejudice to the criminal liability which the latter may incur. where the vessel is shipwrecked 3. the Filipino consul in said port shall hold a summary investigation of the accident. The action for the recovery of losses and damages arising from collisions cannot be admitted if a protest or declaration is not presented within twenty-four hours before the competent authority of the point where the collision took place. protests Art. when the vessel makes an arrival under stress 2. of if having taken place in the open seas. With respect to damages caused to persons or to the cargo. under 835. If the collision should take place between Philippine vessels in foreign waters. Shipwrecks PAGE 147 .TRANSPORTATION AND MARITIME LAW pilots. Art. and the vessels should make a foreign port. or that of the first port of arrival of the vessel. if it occurred in a foreign country.
842. or because the vessel put to sea insufficiently repaired and equipped. of the losses and damages resulting therefrom. the captain of the wrecked vessels shall enter a protest against him. in case the wreck or stranding is due to the (1) malice. and any of them should be wrecked. Art. the cargos saved shall be distributed among the rest in proportion to the amount which each one is able to take. negligence. 840. and the amount thereof must be paid by the owners of the former before they are delivered to them. or (2) because the vessel put to sea was insufficiently repaired and equipped. 843. PAGE 148 . 841.TRANSPORTATION AND MARITIME LAW Art. The losses and deteriorations suffered by a vessel and her cargo by reason of shipwreck or stranding shall be individually for the account of the owners. the part which may be saved belonging to them in the same proportion. by running against another vessel or thing at sea. The goods saved from the wreck shall be specially bound for the payment of the expenses of the respective salvage. ratifying the protest within twenty-four hours after arrival at the first port. or on coast --> renders the ship incapable of navigation Under 841. and with preference over any other obligation if the merchandise should be sold. to receive what may correspond to him. without sufficient cause. the captain shall be liable Art. the salvage allowance should be charged against the ship and cargo in proportion of their respective values. 614. If several vessels sail under convoy. Where a ship and its cargo are saved together.e negligence. before two sea officials. 612. If the wreck or standing should be caused by the malice. the ship agent or the shippers may demand indemnity of the captain for the damages caused to the vessel or to the cargo by the accident. either by being swallowed up by the waves. or lack of skill of the captain. and 621. Shipwreck: Loss of a vessel at sea. If any captain should refuse. and including it in the proceedings he must institute in accordance with the provisions contained in Article 612. the same as in general averages and neither is liable for the salvage due from the other Where a personal action is brought by the salvor against the owner of the ship. the liability of the latter is limited to such part of the salvage compensation due for the entire service as is proportionate to the value of the ship Art. in accordance with the provisions contained in Articles 610. or lack of skill of the captain.
not being included in the above paragraph. the designation thereof to be made by the captain with the concurrence of the officers of his vessel. it is a derelict and the change of their intention and an attempt to return to it will not change its nature ex. the goods of the highest value and smallest volume shall be saved first. running against a thing at sea. may be the subject of salvage. in PAGE 149 . loss of a vessel at sea. assist in saving a vessel or its cargo from shipwreck. the vessel or its cargo shall be beyond the control of the crew. the latter shall be entitled to a reward for the salvage. if at the time the services were rendered. shall be entitled to a like reward. or without any intention of returning it --> if those in charge of the property left it with the intention of finally leaving it. the service is one of salvage an the towage is merely incidental Rights of finder of derelict: The finder who takes possession with the intention of saving her. Salvage Law (Act No. renders to the owner of a ship or goods by his own labor. deserted by her captain with no intention to return. as in cases of shipwrecks. or on the coast Derelict. without any hope of recovering it. When in case of shipwreck. nor does the finder acquire any such right. and picked up and conveyed to a safe place by other persons. The owner does not renounce his right of property.A ship or her cargo which is abandoned and deserted at sea by those who are in charge of it. a schooner which has capsized in the high seas. which is transferred to the finder who becomes bound to preserve the property with GF and bring it to a place of safety for the owner's use. there was a probable.-The compensation allowed to persons by whose voluntary assistance a ship at sea or her cargo or both have been saved in whole or in part from impending sea peril. This is not presumed to be intentional.a service which one person. his right of possession. gains a right of possession which he can maintain against the true owners. preserving the goods or ship which the owner or those entrusted with the care of them either abandoned in distress at sea or are unable to protect and secure ---> a permit is required to engage in salvage business Shipwreck-. threatening danger to the vessel or its cargo --> if the vessel towed is aided in escaping present or prospective danger. 2616) Section 1. Salvage. Those who. But the owner thus abandons temporarily. or such property recovered from actual peril or loss. or shall have been abandoned by them. either by being swallowed up by the waves.-.TRANSPORTATION AND MARITIME LAW If it is not possible to transfer to the other vessels the entire cargo of the vessel wrecked.means a ship which has received injuries rendering her incapable by navigation. though not abandoned. derelict or recapture -. is a derelict a vessel.
or that the services rendered contributed to such success Distinction between salvage and towage is of importance to the crew of the salvaging ship : if the contract for towage is in fact towage. NCC) applicable to the relationship of quasi-contract of towage. If the captain of the vessel. owner or a representative of either of them. success. the owner or his representative shall have the right to the delivery of the vessel or the things saved. the crew of the salvaging ship is entitled to salvage. but it is not a debt due by the owner to the salvor for services rendered but upon the principle that the service creates a property in the thing saved --> he is. or the person acting in his stead. PAGE 150 . 2142. to the Collector of Customs. or coast merchandise or effects proceeding from a shipwreck or proceed to the salvage of the vessel. if the port has a collector. no one shall take from the sea. He is not bound to part with the possession until he is paid or the property is taken into the possession of the law preparatory to the amount of salvage being legally asserted Elements of a valid salvage: 1. Salvor has an interest in the property. shall convey and deliver such vessel or merchandise. a joint owner and if. a marine peril 2. Section 4. service voluntarily rendered when not required as an existing duty or from special contract 3. After the salvage is accomplished. and otherwise to the provincial treasurer or municipal mayor. then the crew does not have any interest or rights with the renumeration pursuant to the contract. where the crew is not entitled to compensation separate from that of the vessel Section 2. provided that he pays or gives a bond to secure the expenses and the proper reward. without the consent of such captain or person acting in his stead. as soon as possible. BUT if the owners of the respective vessels are of a salvage nature. is present. he acquires a right to be paid for his service a reasonable and proper compensation out of the property itself. or from the shores. the property is lost he must bear his share like other joint owners. and can look to the salvaged vessel for its share Captain towing vessel cannot invoke equity in quasi-contract of towage --> there is an express provision of law (Art. in the absence of the captain of the vessel. to all intents and purposes. He who shall save or pick up a vessel or merchandise at sea. in whole or in part.TRANSPORTATION AND MARITIME LAW return. Section 3. this is called a lien. they being unknown.
provincial treasurer. He who shall have commenced the salvage in spite of opposition of the captain or his representative. its validity may be impugned because it is excessive. shall order: a.TRANSPORTATION AND MARITIME LAW Payment of compensation where vessel and cargo salvage : where a ship and its cargo are saved together. to whom a salvage is reported. Section 6. Section 8. The sale at public auction of the things saved which may be in danger of immediate loss or those whose conservation is evidently prejudicial to the interests of the owner. No claim being presented in the three months subsequent to the publication of the advertisements prescribed in subsection (c) of Section 5. The Collector of Customs. the things saved shall be sold at public auction. with a statement of the mark and number of the effects requesting all interested persons to make their claims. one-half of the deposit shall be adjudged to him who saved the things. in one of the local newspapers or in the nearest newspaper published. of all the details of the disaster. the owner or his representative shall claim them. and it may be required to be reduced to an amount proportionate to the circumstances. as in the case of general average Section 5. and the other half to the insular government. and their proceeds. If three years shall pass without anyone claiming it. Section 7. and a bond is given by the owner or his representative to secure the payment of the expenses and the proper reward. and c. an agreement is entered into concerning the amount of the reward for salvage or assistance. If. That the things saved be safeguarded and inventoried. after deducting the expenses and the proper reward shall be deposited in the insular treasury. provided that there is no controversy over their value. such authorities shall order their delivery to such owner or his representative. If. The following shall have no right to a reward for salvage or assistance: a. the salvage allowance should be charged against the ship and cargo in the proportion of their respective values. or municipal mayor. when no objection is made to such sale. Section 9. the delivery shall not be made until the matter is decided by the CFI (RTC) of the province. The crew of the vessel shipwrecked or which was in danger of shipwreck. b. during the danger. PAGE 151 . He who shall have failed to comply with the provisions of Section 3. The advertisement within the 30 days subsequent to the salvage. b. c. while the vessel or thing saved are at the disposition of the authorities. Otherwise.
it may be very much larger than mere quantum meruit --> as a reward for perilous services Such contracts for salvage will not be set aside unless corruptly entered into." Section 11. From the proceeds of the sale of the things saved shall be deducted. a liberal compensation. the number of persons who aided. or save the vessel or the cargo or both. the time employed. under compulsion or contrary to equity and good conscience Section 10. the law allows him. or made under fraudulent representations. The amount should be liberal enough to cover the expenses and to give an extra sum as a reward for the services rendered. conversation. a clear mistake or suppression of important facts.wherein the compensation is dependent upon success (2) rendered under a contract for a pier diem or per horam wage. should be liberal enough to offer an inducement to others to render like services in similar emergencies in the future. the excessive expenses occasioned. and heroic endeavor in saving life and property in peril. Reasons for allowing salvage compensation to salving vessel: (1) to reward promptness. and from the net amount remaining shall be PAGE 152 . the expenses of their custody. the services rendered.TRANSPORTATION AND MARITIME LAW Kinds of salvage service: (1) voluntary . in case he is successful. BUT should not be so high as to cause vessels in need of assistance to hesitate because of ruinous cost "Public policy encourages the hardy and adventurous mariner to engage in these laborious and sometimes dangerous enterprises. In a case coming under the last preceding section. as well as whatever taxes or duties they should pay for their entrance. (3) recognizes the danger and risk to which the crew and the vessel were exposed to in saving the ship and property and life. (2) to compensate the use and service of the vessel as an indispensable instrument for the salvage. the danger to which they and their vessels were exposed as well as that which menaced the things recovered or salvaged. taking into account principally the expenditures made to recover. the reward for salvage or assistance shall be fixed by the RTC of the province where the things salvaged are found. and the value of such things after deducting the expenses. and auction. energy. the zeal demonstrated. and with a view to withdraw from him every temptation to embezzlement and dishonesty. then there shall be deducted the expenses of salvage. advertisement. first. as well as in the absence of an agreement. efficiency. payable at all events Where the compensation is dependent upon success.
TRANSPORTATION AND MARITIME LAW taken the reward for the salvage or assistance which shall not exceed 50% of such amount remaining. Section 12. If in the salvage or in the rendering of assistance different persons shall have intervened the reward shall be divided between them in proportion to the services which each one may have rendered, and in case of doubt, in equal parts. Those who, in order to save persons, shall have been exposed to the same dangers shall also have a right to participation in the reward. No other person has the right to interfere with the salvage of a vessel or cargo if the salvor is able to effect the salvage with fidelity and vigor --> if their means are inadequate, they are bound to accept additional assistance if offered Taking passengers from a sinking ship, without rendering any service in rescuing the vessel, is not a salvage service, being a duty of humanity and not for reward --> the Salvage Act, giving salvors of human life a fair share or remuneration offered to salvors of the vessel, refers to a situation where both lives and property were simultaneously imperiled and both are rescued at the same time Section 13. If a vessel or its cargo shall have been assisted or saved, entirely or partially, by another vessel, the reward for salvage or for assistance shall be divided between the owner, the captain, and the remainder of the crew of the latter vessel, so as to give the owner a half, the captain a fourth, and all the remainder of the crew the other fourth of the reward, in proportion to their respective salaries, in the absence of an agreement to the contrary. The expenses of salvage, as well as the reward for salvage or assistance, shall be a charge on the thing salvaged or their value. The owner of the salving vessel has always been considered as entitled to salvage reward for the use of his vessel in rendering salvage services, though he was not present when the salvage service was rendered --> remuneration is awarded on account of the danger to which the service exposes their property and the risk which they run of loss in suffering their vessels engaged in such perilous undertaking. Section 14. This 2/4/16. Act shall take effect on its passage. Enacted
MRR vs Macondray 37 Phil 850 Issues : Is the plaintiff entitled to recover renumeration for saving the cargo as well as for saving the ship? What is the reasonable compensation which should be allowed?
TRANSPORTATION AND MARITIME LAW Held : There is no question as to the liability of defendant for the service rendered by plaintiff. Nor is there any dispute over the fact that the service rendered was a salvage service and renumerable as such. Where a ship and its cargo are saved together, as a result of services carried on with a view to saving both, the salvage allowance should be apportioned between the ship and cargo in the proportion of their respective values, the same as in a case of general average; and neither is liable for the salvage due from the other. If one who have salved both ship and cargo brings before the court in his salvage action only the ship, or only the cargo, he will get judgment only for such amount of reward as the court finds to be due in respect of the value of that property which is before the court. Not only is the salvage charge a separate and divisible burden as between ship and cargo, but also as between portions of the cargo belonging to different owners. There is no common liability for the amounts due from the ship or other portions of the cargo when the ship and cargo, or either, are brought into the custody of the court as a result of a proceeding in rem. The rule of liability must be the same where a personal action is instituted against the owners of the one or the other. The personal liability of each must be limited to the portion of the salvage charge which should be borne by his own property. If it had been alleged and proved that the ship was unseaworthy when she put to sea or that the necessity for the salvage service was due to the negligence of the master, or of the ship's owner, the latter might have been liable, at least between himself and the shipper, for the entire cost of the service. But when the claim is put upon the basis of salvage, the fixing of the compensation goes beyond the limits of a quantum meruit for the work and labor done and involves the assessment of a bounty. The amount to be allowed is in part determined upon considerations of equity and public policy; and it is not proper to make the ship or the ship's owner liable for the whole amount. But where the owner of the cargo has not been made a party to the action, no recovery can be had in this action in regard to the service rendered to the cargo. In fixing the compensation, the ff. circumstances are taken into consideration: (1) the labor expended by the salvors in rendering the salvage service; (2) the promptitude, skill and energy displayed in rendering the service and saving the property; (3) the value of the property employed by the salvors, and the danger to which such property was exposed; (4) the risk incurred by the salvors in rescuing the property from the impending peril; (5) the value of the property salved; and (6) the degree of danger from which the property was rescued. In applying these criteria to this case, the ff. circumstances are pertinent : the Hondagua was delayed in her voyage about nine hours. This delay caused her to enter Iloilo, the port of destination, in the early hours of the morning instead of the late afternoon of the previous day; but the unloading of her cargo was not thereby retarded. Under the charter party contract under which she was operating, the Hondagua was earning about P 300/day, which was considered reasonable compensation for her use, including the services of officers and crew. The service rendered did not involve any further expenditure of labor on the part of the salvors, no unusual display of skill and energy and the condition of the sea was not such as to involve any special risk either to Hondagua or her crew. Finally, the danger
TRANSPORTATION AND MARITIME LAW from which the Seward was rescued was real since the ship was confronted by a serious peril. In determining the amount of the award, the aim should be to hold out to seafaring men a fair inducement to the performance of salvage service without fixing a scale of compensation so high as to cause vessels in need of such services to hesitate and decline to receive them because of the ruinous cost. That the salvor is entitled, as of bounty, to something more than mere renumeration for his own work and the risk incurred by him is conceded; but the interests of commerce should also be considered. Towage is not considered a salvage service of high order of merit and where the risk is inconsiderable and other conditions favorable, the compensation to be allowed should be modest in its amount. In this case, the sum of P 1,000 is adequate for the service rendered. Barrios vs Go Thong 7 SCRA 535 Issue: WON the service rendered by plaintiff constituted salvage or towage, and if so, WON plaintiff may recover from defendant compensation for such service. Held :(1) According to Sec. 1 of the Salvage Law, those who assist in saving a vessel or its cargo from shipwreck, shall be entitled to a reward (salvage). "Salvage" has been defined as the compensation allowed to persons by whose assistance a ship or her cargo has been saved, in whole or in part, form impending peril on the sea, or in recovering such property from actual loss, as in case of shipwreck, derelict or recapture. There was no marine peril in this case. Although defendant's vessel was in a helpless condition due to engine failure, it did not drift too far from the place where it was. As found by the LC, the weather was fair, clear and good. The waves were small and too slight, so much so, that there were only ripples on the sea, which was quite smooth. During the towing of the vessel on the same night, there was moonlight. Although said vessel was drifting towards the open sea, there was no danger of its foundering or being stranded, as it was far from any island or rocks. In case of danger of stranding, its anchor could be released, to prevent such occurrence. There was no danger that defendant's vessel would sink, in view of the smoothness of the sea and the fairness of the weather. That there was absence of danger is shown by the fact that said vessel or its crew did not even find it necessary to lower its launch and two motor boats, in order to evacuate its passengers no were the cargo in danger of perishing. All that the vessel's crew members could no do was to move the vessel on its own power. That did not make the vessel a quasi-derelict, considering that even before the plaintiff-appellant extended the help to the distressed ship, a sister vessel was known to be on its way to succor it. (2) But plaintiff's service can be considered as a quasi- contract of towage. In consenting to plaintiff's offer to tow the vessel, the defendant through its captain, thereby impliedly entered into a juridical relation of towage with the owner of the MV Henry. If the contract thus created is one for towage, then only the owner of the towing vessel , to the exclusion of the crew of the said vessel, may be entitled to renumeration. And as the vesselowner, William Lines, had expressly waived its claim for compensation for the
TRANSPORTATION AND MARITIME LAW towage service rendered to defendant, it is clear that plaintiff, whose right if at all depends upon and not separate from the interest, is not entitled to payment for such towage services. Neither may the plaintiff captain invoke equity in support of his claim for compensation against defendant. There being an express provision of law (Art. 2142, NCC) applicable to the relationship created in this case, that is, that of a quasi-contract of towage where the crew is not entitled to compensation separate from that of the vessel, there is no occasion to resort to equitable considerations.
E. SPECIAL CONTRACTS OF MARITIME COMMERCE 1. Charter Parties a. Definition; as common carrier A charter party is a contract by virtue of which the owner or agent of a vessel binds himself to transport merchandise or persons for a fixed price. It is a contract by which the owner or agent of the vessel leases for a certain price the whole or a portion of the vessel for the transportation of goods or persons from one port to another. Towage is not a charter party; instead it is a contract for the hire of services by virtue of which a vessel is engaged to tow another vessel from one port to another for a consideration Planters Products vs CA G.R. 101503 (Sept. 15, 1993) F:
Planters purchased urea fertilizer from Mitsubishi,New York. The fertilizer was shipped on MV Sun Plum, which is owned by KKKK, from Alaska to San Fernando, La Union. A time charter party was entered into between Mitsubishi as shipper/charterer and KKKK as shipowner. Upon arrival in the port, PPI unloaded the cargo. It took PPI 11 days to unload the cargo. PPI hired a marine and cargo surveyor to determine if there was any shortage. A shortage and contamination of the fertilizer was discovered. PPI sent a claim letter to SSA, the resident agent of KKKK for the amount of the loss. An action for damages was filed. SSA contended that the provisions on CC do not apply to them because they have become private carriers by reason of the charter-party. The TC awarded damages. The CA reversed.
Issue : Does a charter party between a shipowner and a charterer transform a CC into a private one as to negate the civil law presumption of negligence in case of loss or damage to its cargo? NO. Held : A charter-party is a contract by which an entire ship, or some principal part thereof, is let by the owner to another person for a specified time or use. There are 2 kinds : (1) contract of affreightment which involves the use of shipping space or vessels leased by the owner in part or as a whole, to carry goods for others; and (2) charter by demise or bareboat charter where the whole vessel is let to the charterer with a transfer to him of its entire
It is therefore imperative that a public carrier shall remain as such. insofar as such particular voyage is concerned. Held : The presumption of negligence on the part of respondent carrier has been overcome by the showing of extraordinary zeal and assiduity exercised by the carrier in the care of the cargo. b. the charterer obtaining the right to use the vessel and carry whatever cargo it chooses. It is only when the charter includes both the vessel and the crew.involves the transfer of full possession and control of the vessel for the period covered by the contract. When PPI chartered the vessel. no proof was adduced by the petitioner showing that the carrier was remiss in the exercise of due diligence in order to minimize the loss or damage to the goods it carried. On the other hand. the ship captain. provided the charter is limited to the ship only. as in the case of a time-charter or a voyage-charter. Thus it continued to be a public carrier. It is not disputed that the carrier operates as a CC in the ordinary course of business. its officers and crew were under the employ of the shipowner and therefore continued to be under its direct supervision and control. NO. unless such right is expressly granted in the contract (2) as to time (a) until a fixed day or for a determined number of days or month (b) for a voyage (3) as to freightage (a) for a fixed amount for the whole cargo (b) for a fixed rate per ton (c) for so much per month Maritime Agencies vs CA 187 SCRA 346 Held : There are 3 general categories of charters: 1. including the master and the crew.the charterer does not as a rule acquire the right to fix the date when the vessel should depart. who are his servants. Kinds Classes of charter party: (1) as to extent of vessel hired (a) total (b) partial . notwithstanding the charter of the whole or portion of a vessel. Demise or bareboat charter .TRANSPORTATION AND MARITIME LAW command and possession and consequent control over its navigation. as in a bareboat or demise that a CC becomes private. while manning and supplying the ship as well PAGE 157 . Issue : WON the carrier is liable for damages.
in accordance with the COGSA. which could only mean that they were damaged or lost on board the vessel before unloading of the shipment. The entire cargo was covered by a clean B/L.In the present case. the owner shall not be liable for any other cause. stowage and discharging at the ports visited. Transcontinental was disclosed as the charterer's principal and Maritime only acted within the scope of its authority. However. Par. In this case. having assumed this activity under the charter party free of expense to the vessel. the carrier and the ship shall be discharged from liability.contract to use a vessel for a particular period of time. while the owner was responsible for the care of the cargo. The shipowner should be held liable. The difficulty is that Transcontinental has not been impleaded and so is beyond the court's jurisdiction. In cases at bar. 2 of the Uniform General Charter provided that the owner shall be responsible for loss or damage or delay in the delivery of goods caused by improper or negligent stowage of the goods or by personal want of due diligence in making the vessel seaworthy and properly manned. the charterer did not represent itself as a carrier and indeed assumed responsibility only for the unloading of the cargo. it cannot be held solidarily liable with Transcontinental for the losses/damages to the cargo outside the custody of the vessel. the voyage charter is a contract of affreightment and is considered a private carriage . PAGE 158 . the charterer was responsible for loading. Hongkong Island. the parties may freely contract respecting liability for damages to the goods and other matters. the presumption is that they were damaged or lost during the voyage as a result of their negligent improper storage. Union filed the complaint against Hongkong within the one year period but tardily against Macondray. although the owner retains possession and control 3. As regards the goods damaged or lost during unloading. As the bags were in good order when received by the vessel. Otherwise. Maritime acted in representation of the charterer and not of the vessel. the charterer obtaining the right to direct the movements of the vessel during the chartering period. The action has prescribed with respect Macondray but not against the principal. Time Charter . As a mere charterer's agent. The one year period should commence from Oct. the TC found that there were shortlanded bags. The filing of the claim must be within one year. even from the neglect of the captain or the crew or any other person employed by the owner on board. 1979. the date when the last item was delivered to the consignee. or for any unseaworthiness of the vessel on loading or commencement of the voyage.being a private carriage.TRANSPORTATION AND MARITIME LAW 2. The liability imposed on it cannot be borne by Maritime which is a mere agent and is not answerable for the injury caused by its principal (unless the principal is undisclosed). 20. the charterer is liable thereof.contract for the hire of a vessel for one or a series of voyages usually for the purpose of transporting goods for the charterer. Voyage Charter . responsibility for the cargo loss falls on the one who agreed to perform the duty involved in accordance with the terms of the voyage charter This case involves a voyage charter.
Her flag and port or registry. The liability of Macondray can no longer be enforced because of prescription. The days agreed upon for loading and unloading. the answer is no. 653. and tonnage of the vessel. The freightage to be paid. and of the charterer. if we take into account the fact that delivery of the cargo does not constitute the making of a contract but rather the partial performance thereof. if the latter should make the charter party. which shall be the only instrument with regard to the freight to determine the rights and obligations of the ship agent. the mere fact of delivery and receipt of such cargo. If the freight should be received without the charter party having been signed. besides the condition stipulated. the GF and mutual consent with which PAGE 159 . and when either does not know how or is not able to do so. that of the person for whose account he makes the contract. 11. The capacity. The name. 9. surname. or in any other manner whatsoever agreed upon. The name. the B/L shall be considered the contract of the parties Q: If there is no charter party and B/L. and domicile of the captain. and if he states that he is acting by commission. 653 literally. The name. 5. The amount of primage to be paid the captain. and domicile of the agent. Forms and Effects Art. 4. The port of loading and unloading. If the cargo is received without a charter party. surname. The kind. Maritima cannot be held liable for the principal's acts. of the captain. surname. 6. However.TRANSPORTATION AND MARITIME LAW The TC's findings were upheld except for some modifications. or whether it is the total cargo. or for the space to be occupied. number of tons or weight. Art. The lay days and extra lay days to be allowed and the rate of demurrage. would there be a valid contract? A: Taking Art. stating whether it is to be a fixed amount for the voyage or so much per month. or for the weight or measure of the goods of which the cargo consists. and domicile of the charterer. the contract shall be understood as executed in accordance with what appears in the bill of lading. 2. name. c. 10. by two witnesses at his request. 8. 652. 3. A charter party must be drawn in duplicate and signed by the contracting parties. or measure which they respectively bind themselves to load and transport. The charter party shall include. 7. the following circumstances: 1.
The contracts shall also be admitted as evidence.TRANSPORTATION AND MARITIME LAW they have been made. The charter parties executed with the intervention of a broker. that which agrees with the one which the broker must keep in his registry. the captain shall be entitled to demand demurrage for PAGE 160 . but the latter shall have a right of action against the captain to recover damages. Should no broker have taken part in the charter party and the signatures be not acknowledged.Days allowed to charter parties for loading and unloading the cargo Art. it is an extended freight or reward to the vessel in compensation for the earnings she is improperly caused to lose Lay days. even though a broker has not taken part therein. it is no longer a gratuity to the master. should be a better substitute for the charter party than is the B/L which is nothing more than the proof of such delivery. Charter parties executed by the captain in the absence of the ship agent shall be valid and effective.-. by the proofs submitted by the parties. After the stipulated or customary period has passed. Demurrage. 656. if kept in accordance with law. If in the charter party the time in which the loading and unloading are to take place is not stated.-. doubts shall be decided by what is provided for in the bill of lading. 654. and.Sum which is fixed by the contract of carriage. in the absence thereof. a small allowance or compensation payable to the master and marines of a ship. and. to the latter for lading and unlading in any port of haven Primage. if the contracting parties acknowledge the signatures of the same as their own. unless especially stipulated. Art. but it belongs to owners or freighters and is nothing but an increase of the freight rate. Primage. as remuneration to the owner of a ship for the detention of his vessel beyond the number of days allowed by the charter party for loading and unloading or for sailing. the usages of the port where these acts take place shall be observed. if they should be conflicting. and should there not be in the freight contract an express provision fixing the indemnification for the delay. 655. at present. shall govern. Art. shall be full evidence in court. to the former for the use of his cables and ropes to discharge the goods of the merchant. who certifies to the authenticity of the signatures of the contracting parties made in his presence.-. or which is allowed. even though in executing them he should have acted in violation of the orders and instructions of the agent or shipowner.Formerly.
657. 661 .TRANSPORTATION AND MARITIME LAW the lay days and extra lay days which may have elapsed in loading and unloading. 660 . it shall be returned (3) Art. for which purpose he shall be obliged to look for a vessel not only at the port of arrival but also in the neighboring ports within a distance of 150 kilometers. notwithstanding his diligence.goods seized by pirates or enemies. or of (b) fortuitous event (3) Art. 659 . or (6) increase by natural cause in weight or size ** Goods that shall not pay freightage: (1) Art. 661 . the freight being adjusted in such cases by the distance covered by the vessel.goods which suffer deterioration or dimunition on account of (a) inherent defects or bad quality of packing. to carry the cargo to its destination. (5) suffer deteriorations or dimunitions. through indolence or malice. freight paid in advance shall be returned ** Goods required to pay freightage: (1) Art. The same authority shall judicially compel the captain to carry out for his account and under his responsibility the charter made by the shippers.goods jettisoned for the common safety but the amount of freightage that should have been paid shall be considered as a general average and shall be computed in proportion to the distance covered when they were jettisoned (2) Art. If during the voyage the vessel should be rendered unseaworthy the captain shall be obliged to charter at his expense another one in good condition. with no right to any indemnification whatsoever. (4) be seized by pirates or enemies. after requesting the captain to charter a vessel within an unextendible period. the shippers. if freight had been paid in advance. may charter one and apply to the judicial authority for the summary approval of the charter party which they may have made. he shall deposit the cargo at the disposal of the shippers. Art. (2) be jettisoned for the common safety.goods that increase in size or weight by natural cause PAGE 161 . should not furnish a vessel to take the cargo to its destination. (3) be lost by reason of shipwreck or stranding. 663 . Articles 659 to 664 : Some of the goods being transported may : (1) be sold by the captain to pay for necessary repairs. machinery or equipment or for unavoidable and urgent needs --> but the freight may not be required to be paid in full (2) Art. If the captain. should not find a vessel to charter.merchandise lost by reason of shipwreck or stranding. If the captain.goods sold by the captain to pay for the necessary repairs to the hull. 644 . to whom he shall communicate the facts on the first opportunity.
the freightage shall be reduced in proportion to the cargo the vessel cannot receive. they shall indemnify the shippers whose contracts they do not fulfill for the losses they may have caused them by reason of their default. and by reason of the want of space all the cargo contracted for cannot be received. the charterer shall have a right to demand that the vessel put to sea with the cargo she may have on board. in proportion to the weight or space they may have engaged. on the contrary. If the shipowner or the captain should contract to carry a greater amount of cargo than the vessel can carry. and the rest shall take the place corresponding to them in the order of the dates of their contracts. Rights and Obligations of Shipowners Art. PAGE 162 . at the price he may have fixed. and should no time have been fixed. when he has a right to do so. and there should appear to be an error or fraud in her capacity. and should he do so. The shipowner of the captain shall observe in charter parties the capacity of the vessel or that expressly designated in its registry. a difference greater than 2 per cent between that registered and her true capacity not being permissible. in view of her tonnage. viz: If the vessel has been chartered by one shipper only. and the person from whom the vessel was chartered shall be obliged to indemnify them for losses and damages. preference shall be given to the person who has already loaded and arranged the cargo in the vessel. if they wish. should there be any.TRANSPORTATION AND MARITIME LAW d. according to the cases. being for his account. and none of the charterers desires to rescind the contract. the person from whom the vessel is chartered or the captain may not refuse to accept the rest of the cargo. should nothing to the contrary have been stipulated. the expenses of transfer. and the charterer should not wish to rescind the contract. Should he not be able to make this change. If. the charterers may load. and the increase in the price of the charter. within fifteen days from the time the loading began. there should be several charter parties. the person from whom the vessel is chartered being furthermore obliged to indemnify the charterer for the losses he may have caused him. after receiving a part of the cargo. Should there be no priority. If the owner of the part of the cargo already loaded should procure some more at the same price and under similar or proportionate conditions to those accepted for the freight received. Art. should not find sufficient to make up at least three fifths of the amount the vessel can hold. he may substitute for that transportation another vessel inspected and declared suitable for the same voyage. 669. If the person from whom the vessel is chartered. 670. the voyage shall be undertaken at the time agreed upon.
Art. or transport it. without the consent of the charterers or shippers. 673. the captain shall appear before the consignee designated in the charter party. If the vessel has been chartered to receive the cargo in another port. The person from whom the vessel is chartered shall be liable for all the losses caused the charterer by reason of the voluntary delay of the captain in putting to sea. the lay days agreed upon. Art. 671. and should he do so. before leaving the port. discounting that which may have been earned on the merchandise which may have PAGE 163 . If the charterer should carry to the vessel more cargo than that contracted for. said charterer may oblige him to unload it and to indemnify him for the losses suffered thereby. he shall make efforts to find cargo. Should the captain not receive an answer within the time necessary therefore. it he can do so and keep the vessel in trim. the excess may be admitted in accordance with the price stipulated in the contract if it can be well stowed without incurring the other shippers. unload the merchandise clandestinely placed on board. beginning to run in the meantime. but if in order to stow said cargo it should be necessary to stow it in such manner as to throw the vessel out of trim the captain must refuse it or unload it at the expense of its owner. the captain may not. without the consent of the person chartering her. If the vessel has been chartered in whole. The captain may likewise. provided he has been requested to put to sea at the proper time through a notary or judicially. 675. accept cargo from any other person. and should he not find any after the lay days and extra lay days have elapsed.TRANSPORTATION AND MARITIME LAW Art. under the penalty of making himself thereby liable for all the losses and damages occurring during the voyage to the cargo of those who did not consent to the change. Art. and should the latter not deliver the cargo to him. the person from whom she is chartered may not. he shall make a protest and return to the port where the charter was made. After three-fifths of the vessel is loaded. 674. according to the rules prescribed. Art. demanding by way of freightage the highest price which may have been stipulated for said voyage. substitute the vessel designated in the charter party with another one. unless there is an express agreement to the contrary. 672. he shall inform the charterer and await his instructions. or those allowed by custom in the port. The charterer shall pay the freightage in full.
670 . Art. the cargo should be discharged at the port of arrival. Art. 676. 670 . the freightage for the voyage out shall be paid in full. not to accept cargo from any other person without the consent of the charterer PAGE 164 .TRANSPORTATION AND MARITIME LAW been carried on the voyage out or on the return trip. Art. If. The captain shall lose the freightage and shall indemnify the charterers if the latter should prove. requesting and awaiting orders from the shipper. to accept other cargo procured by the owner of the freight already loaded under the same price and conditions 4. which shall be paid from the proceeds of the part first sold. 669 . to receive orders from the shippers should have elapsed without the captain having received any instructions. in the opinion of the judge or court. and it shall be liable for the payment of the freightage and expenses incurred by reason of the delay. if carried for the account of third persons. by orders of the shipper. and the expenses and salaries accruing during the detention shall be paid as general average. where he fails to exercise his right to change vessel 3. if one has been made at the port of departure. The same shall be done if a vessel.where the shipowner should not find cargo sufficient to make up at least 3/5 of the amount which the vessel may hold. If the time necessary. that the vessel was not in a condition to navigate at the time of receiving the cargo. Art. even if the shipowner should not find cargo sufficient to make up at least 3/5 of the amount which the vessel may hold. 677. 678. without the consent of the charterers or shippers 5. should not be given any cargo for her return. 672 .if the vessel has been chartered in whole. 671. Art.to observe in the charter parties. even against the certificate of inspection. the capacity of the vessel. Art. and to indemnify the shippers whose contracts are not fulfilled for the losses they may have suffered by the failure of the shipowner to observe the capacity of the vessel 2. the cargo shall be deposited. Art. having been chartered for the round trip.not to change the vessel after 3/5 of the vessel has been loaded. The charter party shall subsist if the captain should not have any instructions from the charterer. Art. In such case the captain must proceed to the nearest safe and neutral port. and a declaration of war or a blockade should take place during the voyage. Obligations of shipowner: 1.to undertake a voyage at the time agreed upon or within 15 days from loading if no time is stipulated.
Art. without PAGE 165 . 681.to have the vessel in a condition to navigate at the time of receiving the cargo 8. Art. 674 . 680. 675. 670 . after he receives no cargo from the consignee and after he receives no answer from the charterer 6. where the captain has not received any instructions from the charterer. for the captain to proceed to the nearest safe and neutral port. and to receive in such cases. if the vessel has been chartered to receive cargo in another port. and that the price agreed upon is paid in full.where the cargo is not sufficient to make up at least 3/5 of the amount which the vessel may hold. even though the full cargo is not loaded. Art. requesting and awaiting orders from the shippers Rights of Shipowner: 1. provided the conditions of the first charter are not changed. with the limitation established in the next article. demanding the highest freightage 5.to have the charter party subsist notwithstanding the declaration of war or a blockade during the voyage.to find freight to take place of freight not received. if the captain does not take other freight to complete the load of the vessel. If the charterer should ship goods different from those indicated at the time of executing the charter party.to answer for losses arising from delay in putting to sea 7. 676 . Art. Art. The charterer of an entire vessel may subcharter the whole or part thereof for the amounts he may consider most convenient. the freightage in full where the shipper orders that the cargo should be discharged at the port of arrival e. or to transport them if he can do so. 673 . A charterer who does not complete the full cargo he bound himself to ship shall pay the freightage of the amount he fails to load.to unload merchandise clandestinely placed on board. the captain not being allowed to refuse to receive on board the cargo delivered by the second charterers. 677 .to refuse and unload at the expense of the owner excess cargo that cannot be properly stowed 4. 674 . Obligations of charterers Art.in case of declaration of war or blockade during the voyage. he may substitute anohter vessel inspected and declared suitable for the voyage --> expenses of transfer and increase in price of the charter shall be paid by him 2. Art. 679. discounting that which may have been earned on the merchandise carried as substitute 7. 674 . 677 . Art. Art.TRANSPORTATION AND MARITIME LAW 6.to collect the freight in accordance with the price stipulated for cargo in excess of that agreed upon is such excess can be properly stowed 3. Art. Art.to receive freight in full. in which case he shall pay the first charterer the difference should there be any. Art. Art. 675 .
the expenses of unloading and reloading shall be for the account of the former. If. Art. by reason of confiscation. and should thereby give rise to losses. the latter must immediately pay the captain the freightage due and the other expenses for which the cargo may be liable. shall be liable for all the losses which may be caused to other shippers. he shall pay the full freightage. detention. the shippers must wait until the vessel is repaired. machinery. paying one half the freightage. 686. and even though it may have been agreed. should there be any. should wish to unload his merchandise before arriving at the port of destination. the person giving rise thereto shall be liable with the value of his shipment and furthermore with his property. and the losses and damages caused the other shippers. 685. jointly with the owner of the merchandise. or equipment of the vessel. the expenses of the arrival made at his request. Art. 683. Art. they cannot demand any indemnity whatsoever from the charterer for the damage caused the vessel. and was taken on board with the knowledge of the person from whom the vessel was chartered or of the captain. for the benefit of cargo which runs the risk of deterioration. Art. In case of making a port to repair the hull.TRANSPORTATION AND MARITIME LAW the knowledge of the person from whom the vessel was chartered or of the captain. the latter. for the full indemnity to all those injured through his fault. In charters for transportation of general freight any of the shippers may unload the merchandise before the beginning of the voyage. Art. 682. 684. and any other damage which may be caused the other shippers. or the competent authority in a foreign land should order the merchandise to be unloaded. or other causes. without the occurrence of any of the cases of force majeure mentioned in the foregoing article. If the charterer. being permitted to unload her at their own expense should they deem it advisable. the shippers or the court. After the vessel has been unloaded and the cargo placed at the disposal of the consignee. or the consul. If the merchandise should have been shipped for the purpose of illicit commerce. embargo. to the person from whom the vessel was chartered or to the shippers. the expense of stowing and restoring the cargo. PAGE 166 .
Art. to pay (1) expenses of arrival. 687.TRANSPORTATION AND MARITIME LAW The primage must be paid in the same proportion and at the same time as the freightage. 686 . 685 . detention. embargo. (2) to pay for the expenses of stowing and restowing the cargo. (1) to pay 1/2 of the freight. or other causes. The charterers and shippers may not abandon merchandise damaged on account of its own inherent defect or of fortuitous event for the payment of the freightage and other expenses.not to abandon merchandise damaged on account of inherent defect or fortuitous event. 687 .in case of making a port to repair the hull. 682 . for the payment of the freight and other expenses f. 680 . Art. Art. captain or other shippers arising from confiscation. 682 .where the charterer unloads before the beginning of the voyage.to pay for freight. there remaining in the containers not more than one-fourth of their contents. Art.to pay the freight in full even if the charterer does not complete the full cargo he bound himself to ship 2. (2) full freight and (3) for the damages and losses caused to other shippers. Rescission Art. the charterer: A charter party may be annulled at the request of PAGE 167 . Art. 684 . where the charterer loads goods different from those stated at the time of the execution of the charter party 3. Art.to be jointly liable with the captain for losses which may be caused to the other shippers where the charterer ships goods for illicit commerce with the knowledge of the shipowner or captain 4.where the charterer unloads goods before arriving at port of destination without any force majeure occurring. Art. 688.to answer with the value of his shipment and other property for the losses suffered by the shipowner. however. if the cargo should consist of liquids which may have leaked out. machinery or equipment of the vessel. Obligations of the charterer: 1. (3) to pay any other damage which he may have caused other shippers 7. all the changes and modifications to which the latter should be subject also governing the former. Art. if any 6. The abandonment shall be proper. 681. Art. to wait until the vessel is repaired or to pay for the expenses of unloading should the charterer choose to unload 5. other expenses and the primage after the vessel has been unloaded and the cargo placed at the disposal of the consignee 8.
or if there be an error in the statement of the flag under which she sails. enemies. after the vessel has put to sea. If before loading the vessel he should abandon the charter. and two months. If the charterer at the termination of the extra lay days does not place the cargo alongside the vessel. and the vendor shall indemnify the purchaser if the former did not inform him of the charter pending at the time of making the sale. Art. the shippers shall pay the full freightage for the voyage out. At the request of the person from whom the vessel is chartered the charter party may be rescinded: 1. If. Should the delay exceed thirty days. If the person from whom the vessel was chartered should sell it before the charterer has begun to load it and the purchaser should load it for his own account.TRANSPORTATION AND MARITIME LAW 1. they shall pay the freight in proportion to the distance covered by the vessel. 2. the charterers shall pay the full freightage for one month. 3. if for a port in different waters. the freightage for one month only shall be paid. If a vessel should make a port during the voyage in order to make urgent repairs and the charterers should prefer to dispose of the merchandise. In the second and third cases the person from whom the vessel was chartered shall indemnify the charterer for the losses he may suffer. 2. and the shippers should agree to unload her. In such case the charterer must pay half of the freightage stipulated besides the demurrage due for the lay days and extra lay days. If the charter should have been made by the month. she should return to the port of departure. If the vessel should not be placed at the disposal of the charterer within the period and in the manner agreed upon. if the voyage is for a port in the same waters. If the new owner of the vessel should not load it for his own account the charter party shall be respected. 689. PAGE 168 . paying half the freightage agreed upon. In such case the vendor shall indemnify the charterer for the losses he may suffer. (From one port to another of the Peninsula (Philippines) and adjacent islands. 4.) 5. In the fourth case the person from whom the vessel was chartered shall have a right to the freightage in full for the voyage out. or bad weather. When the delay does not exceed thirty days. on account of risk from pirates. If the capacity of the vessel should not agree with that stated in the certificate of tonnage.
any of the following cases should occur: 1. or the breaking out of an epidemic after the contract was executed. equipment and repair of the vessel and for a definite term. it being stipulated that if the ship be lost in the course of the specific voyage or during the limited time. before the vessel puts to sea from the port of departure. paying demurrage if the reloading should continue after the cause for the detention has ceased. unless there is an agreement to the contrary. by PAGE 169 . closing of ports. defined A contract in the nature of a mortgage. Loan on Bottomry. and the captain shall only be entitled to the freightage for the voyage out. by reason of a declaration of war. 2. or any other temporary cause. The subsistence and wages of the crew shall be considered as general average. During the interruption the charterer may. 3. 690. A condition of blockage of the port of destination of said vessel. A declaration of war or interdiction of commerce with the power to whose ports the vessel was to make its voyage. 2. if. 692. Art. Art. A charter party shall be partially rescinded. Loans on Bottomry and Respondentia a. or for any other reason independent of the will of the ship agent. 5. at the proper timer and for his own account. the charter shall remain in force without right of either of the contracting parties to claim damages. 4. with maritime or extraordinary interest on account of the maritime risks to be borne by the lender. by reason of an embargo of the vessel by order of the government. 691. and pledges the ship (or the keel or bottom of the ship) as a security for its repayment. The prohibition to receive at the said port the merchandise constituting the cargo of the vessel. by which the owner of the ship borrows money for the use. The charter party shall be rescinded and all action arising therefrom shall be extinguished if.TRANSPORTATION AND MARITIME LAW Art. unload and load the merchandise. If the vessel cannot put to sea on account of the closing of the port of departure. The inability of the vessel to navigate. without fault of the captain or ship agent. or interdiction of commercial relations during the voyage. An indefinite detention. the vessel should make the port designated for such a case in the instructions of the charterer. The unloading shall be made for the account of the charterer.
defined One made on the goods laden on board the ship. the borrower who must return the amount borrowed plus premium 3. or of the price they may receive in case of accident. the repayment of the sum loaned and of the premium stipulated depends upon the safe arrival in port of the goods on which it is made. although there are reciprocal benefits. The lender must be paid his principal and interest. b. WON thing given as security is lost or destroyed 3. thought the ship perishes. must be paid absolutely upon at all events. subject to Usury Law loan on bottomry and last lender has preference over previous ones loan is required to be paid only safe arrival of the thing given as security at port of destination no limit as to rate of interest in view of diff. which is therefore called respondentia. the borrower's personal responsibility being deemed the principal security for the performance of the contract. A loan in which. delivery of the amount loaned is necessary for the perfection of the contract 2.TRANSPORTATION AND MARITIME LAW any of the perils enumerated in the contract. 719. Character of Loan Art. and which are to be sold or exchanged in the course of the voyage. c. classes and various risks in a maritime voyage Marine insurance vs Bottomry and Respondentia Loans: PAGE 170 . first lender has preference over subsequent lenders 2. lender really runs known risks Distinguished from ordinary loans: Ordinary loan respondentia 1. provided that the goods are saved. Loan on Respondentia. aleatory contract: 1. unilateral. the contract produces obligations only for one party. Real. shall be considered a loan on bottomry or respondentia. the lender shall also lose his money. under any condition whatever.
where loss arose from having loaded the merchandise on a vessel different from that designated in the contract. the borrower is under no obligation to pay the loan Marine insurance loans 1. to the extent of the loan --> in case of loss of the thing given as security. consensual contract the * governed by Insurance Act loaned bottomry/respondentia indemnity is paid in advance by when marine peril causes the vessel or cargo. where the loss is caused by fault or malice of borrower 3. 3. at least. it shall be entered in the certificate of the registry of the vessel and shall be recorded in the registry of vessels. without which requisites the credits of this kind shall not have. Forms and Requisites Art. where loss is caused by damage to the vessel as a consequence of its engaging in contraband 5. By means of a policy signed by the contracting parties and the broker taking part therein. loss of the the obligation of the insurer of the becomes absolute 3. when marine peril occurs. where the loss is caused by inherent defect of the thing 2. Under whichever of these forms the contract is executed. although the obligation shall be valid between the contracting parties. 2. the obligation borrower to pay is extinguished real contract --perfected from moment of delivery of the thing When loss does not extinguish loan: (Art. where loss is caused by barratry on the part of the captain 4. 731) 1. By means of a private instrument.TRANSPORTATION AND MARITIME LAW The borrower is in effect indemnified for his loss. they should have. By means of a public instrument. The contracts made during a voyage shall be governed by the provisions of Articles 583 and 611. with regard to other credits. the preference which. according to their nature. except if change is due to force majeure d. Loans on bottomry or respondentia may be executed: 1. and shall be effective with PAGE 171 . 720. indemnity is paid after the way of loan loss has occurred 2.
On What Constituted Art. The loans may be constituted jointly or separately: 1. surnames.2 may have binding force. The contracts may be made to order. On the rigging. The name. except from the day and date of their inscription.8th in the order of preference) 2. On the engine. if the vessel is a steamer. Effect of registration: 1. they must conform to the registry of the broker who took part therein. according to its nature. If said eight days should elapse without the record having been made in the registry of vessels. 5. 2. the loan shall have. PAGE 172 . 4. it should have (Art. 721. 4. and fuel. 3 the acknowledgment of the signature shall be required. the contracts made during the voyage of a vessel shall produce no effect with regard to third persons. The voyage during which the risk is run. Art. 580 . and domicile of the captain. provisions. On the merchandise loaded. and the indorsee shall acquire all the rights and shall incur all the risks corresponding to the indorser. 6. The names. On the equipment. 2. e.TRANSPORTATION AND MARITIME LAW regard to third persons from the date of their execution. if they should be recorded in the registry of vessels of the port of registry of the vessel before the lapse of eight days following its arrival. 5. and domiciles of the person giving and the person receiving the loan. The kind. with regard to other credits. The time for repayment. 3. The goods pledged to secure repayment. With respect to those executed in accordance with No. 722. and registry of the vessel. effective against third persons from the time of execution/registration Art. name. Contracts which are not reduced in writing shall not give rise to judicial action. 7. In a contract on bottomry or respondentia the following must be stated: 1. in which case they shall be transferable by indorsement. On the hull of the vessel. The amount of the loan and the premium stipulated. surname. 3. 724. In order that the policy of the contracts executed in accordance with No. the preference which.
If one or more of the owners should be requested to furnish the amount necessary to repair or provision the vessel. If the lender should prove that he loaned an amount larger than the value of the object liable for the bottomry loan. Art. if they were not loaded. provisions. the rigging. shall also be considered as included in the liability for the loan. all that which constitutes the same shall be subject to the repayment. steam engines. 727. The excess shall be valid only as an ordinary loan g. equipment and other goods. The surplus principal shall be returned with legal interest for the entire time required for repayment. the balance shall be returned before clearing. 726. and if on a particular object of the vessel or of the cargo. f. No loans on bottomry may be made on the salaries of the crew or on the profits expected. only the object concretely and specifically mentioned shall be liable. 728. PAGE 173 . The loan which the captain takes at the point of residence of the owners of the vessel shall only affect that part thereof which belongs to the captain. Art. fixing their value in order to determine the principal of the loan.TRANSPORTATION AND MARITIME LAW If the loan is constituted on the hull of the vessel. Art. Loans may be made in goods and in merchandise. By whom Art. Amount Art. If the full amount of the loan contracted in order to load the vessel should not be used for the cargo. fuel. If the loan is made on the cargo. if the other owners or their agents should not have given their express authorization therefor or should not have taken part in the transaction. and the freightage earned during the voyage on which the loan is made. and they should not do so within twenty-four hours. 723. 725. The same procedure shall be observed with regard to the goods taken as loan. the loan shall be valid only for the amount at which said object is appraised by experts. the interest which the parties in default may have in the vessel shall be liable for the loan in the proper proportion. on account of fraudulent measures employed by the borrower.
he shall apply to the judge or court if he is in Philippine territory. proceeding in accordance with the prescriptions of Article 583. Art. By selling a sufficient amount of the cargo to cover the amount absolutely necessary to repair the vessel and to equip her to pursue the voyage. 3. When he is permitted to do so. he must necessarily state what interest he has in the vessel. The captain may not contract loans on respondentia secured by the cargo. By applying to the consignees of the cargo or to the persons interested therein. if in a foreign country. In case of violation of this article the principal. and costs shall be charged to the private account of the captain. 2. and with the provisions of the law of civil procedure. 5. interest. the consul or the local authority as the case may be in view of the result of the proceedings instituted. 583. Neither may he borrow money on bottomry for his own transactions. and should he do so the contract shall be void. and the ship agent may furthermore discharge him. and in his absence to the judge or court or to the proper local authority. Art. if in the Philippines and to the Filipino consul. and provided there does not exist any other kind of lien or obligation chargeable against the vessel. and the instruments proving the obligation contracted. The judge or court. 617.TRANSPORTATION AND MARITIME LAW Outside of the residence of the owners. If the ship being on a voyage the captain should find it necessary to contract one or more of the obligations mentioned in Nos. 8 and 9 of Article 580. Art. By requesting said funds of the consignees of the vessel or the correspondents of the ship agent. By drawing on the ship agent. and when he has no funds and does not expect to receive any from the agent. and otherwise to the Filipino consul. 4. provided no money has been previously borrowed on the whole vessel. and where there should be none. should there be one. in PAGE 174 . presenting the certificate of the registry of the vessel treated of in Article 612. 611. By borrowing the amount required by means of a bottomry loan. the captain shall procure the same in the successive order stated below: 1. the captain may contract loans in accordance with the provisions of Articles 583 and 611. except on the portion of the vessel he owns. In the two last cases he must apply to the judicial authori ty of the port. to the local authority. shall make a temporary memorandum in the certificate of their result. In order to comply with the obligations mentioned in the foregoing article.
Art. with the obligation on the part of the borrower to return the principal and interest at the legal rate. 730. If the full amount of the loan contracted in order to load the vessel should not be used for the cargo. on account of fraudulent measures employed by the borrower. h. Effects of Contract Art. A loan in which. under any condition whatever. and they shall be graduated in the inverse order of their dates. PAGE 175 . the loan shall be valid only for the amount at which said object is appraised by experts. the repayment of the sum loaned and of the premium stipulated depends upon the safe arrival in port of the goods on which it is made. or of the price they may receive in case of accident. If the lender should prove that he loaned an amount larger than the value of the object liable for the bottomry loan. if they were not loaded. The surplus principal shall be returned with legal interest for the entire time required for repayment.TRANSPORTATION AND MARITIME LAW order that it may be recorded in the registry when the vessel returns to the port of her registry. Art. shall be considered a loan on bottomry or respondentia. all of them shall be paid pro rata. The loans for the last voyage shall have preference over prior ones. if that agreed upon should not be lower. Should several loans have been made at the same port of arrival under stress and for the same purpose. 729. Should the goods on which money is taken not be subjected to risk. Loans made during the voyage shall have preference over those made before the clearing of the vessel. the contract shall be considered a simple loan. by reason of the sale of the vessel by virtue of a declaration of unseaworthiness. or so that it can be admitted as a legal and preferred obligation in case of sale before the return. 727. The lack of this formality shall make the captain personally liable to the creditors who may be prejudiced through his fault. Art. Art. The same procedure shall be observed with regard to the goods taken as loan. 719. the balance shall be returned before clearing. 726.
Of these copies the shipper shall keep one and send another to the consignee. and marks of the merchandise. number of packages. The name of the consignee. exists only after delivery of the goods to be transported is made 1. 7. one for himself and the other for the ship agent. in any case. 4.707. Four true copies of the original bill of lading shall be made.real contract. when they are issued to order or to bearer. 706. the captain shall take two. The bill of lading may be issued to bearer. The quantity. and must be signed within twenty. for the captain. The captain and the shipper shall have the obligation of drawing up the bill of lading. The freightage and the primage stipulated. and. which can be dissolved by means of indemnity for losses and damages B/L . The port of loading and that of unloading.consensual party. the losses and damages suffered thereby. and all of them shall be signed by the captain and by the shipper. if the bill of lading is issued in the name of a specified person. 2. Contents Art. 5. Charter party . to order. it is a receipt for the goods shipped and a contract to transport and deliver the same as stipulated A stipulation that a CC's liability is limited to the value of the goods appearing in the B/L. The name of the shipper.four hours after the cargo has been received on board.private receipt which the captain gives to accredit that such goods belong to such persons 2. The name of the captain and his domicile.entire or complete contract B/L . The name. quality. but. the destination of each one. PAGE 176 . Charter party . unless the owner declares a greater value. 3. there shall be stated in all the copies. BILL OF LADING B/L operates both as a receipt and as a contract. or in the name of a specified person. and tonnage of the vessel. registry.TRANSPORTATION AND MARITIME LAW F. There may also be drawn as many copies of the bill of lading as may be considered necessary by the parties. the shipper being entitled to demand the unloading at the expense of the captain should the latter not sign it. stating whether it is for the ship agent. is valid and binding Bill of Lading vs Charter party 1. be they the first four or the subsequent ones. in which shall be stated: 1. 6. Art.
and the latter must do so. it shall be understood that the new captain accepts the cargo as it appears from the bills of lading. when dealing with the bills of lading referred to therein. 714. Art. under penalty. he shall be obliged to issue it.TRANSPORTATION AND MARITIME LAW for the shipper. on the allegation that the failure to present the previous ones is on account of their loss or for any other just cause. the shipper shall have the right to demand of the new captain the ratification of the first bills of lading. If the bills of lading do not agree. if he ceased to be such through his own fault. 713. 2. or for the consignee. Should said examination not be made. and it should appear from an examination of the cargo that they are correct. this circumstance and the fact that it is not valid except in default of the first one must be stated therein. If the copy sent to the latter should have a duplicate. B/L . If before the delivery of the cargo a new bill of lading should be demanded of the captain. The expenses arising from the examination of the cargo shall be for the account of the ship agent. 709. evidence to the contrary being reserved by the latter. and no change or erasure appears in any of them. should he not do so.proof of the agreement between the parties PAGE 177 . Art. provided that all the copies previously issued be presented or returned to him. those in the possession of the shipper or consignee signed by the captain shall be proof against the latter or ship agent in favor of the consignee or the shipper. without prejudice to his right of action against the first captain. Probative Value Art. of being liable for said cargo if improperly delivered through his fault. but without changing the consignment and stating therein the circumstances prescribed in the last paragraph of Article 707. Art. and those possessed by the captain or ship agent signed by the shipper shall be proof against the shipper or consignee in favor of the captain or ship agent. provided that security for the value of the cargo is given to his satisfaction. If before the vessel puts to sea the captain should die or should cease to hold his position through any cause. A bill of lading drawn up in accordance with the provisions of this title shall be proof as between those interested in the cargo and between the latter and the insurers. 710.
Art. 697. but if the suspension was due to an accidental cause. acting in the same way as in the collection of freightage. 700. the passengers shall be entitled to have their passage refunded and to recover for losses and damages. if issued to a specified person. or should he leave the vessel without permission from the captain. 2. In all that pertains to the preservation of order and discipline on board the vessel. If the passage price has not been agreed upon. the judge or court shall summarily fix it. and in case of their sale. after a statement of experts. Obligations of Passengers Art. the captain shall have a right to claim payment for what he may have furnished the passengers. he shall be given preference over other creditors. Should the passenger not arrive on board at the time fixed. Art.TRANSPORTATION AND MARITIME LAW Issuance of B/L is merely prima facie evidence of the receipt of the merchandise by the carrier or his agent. 704. If before beginning the voyage it should be suspended through the sole fault of the captain or ship agent. without any distinction whatsoever. In order to collect the fare and expenses of sustenance. the captain may continue the voyage and demand the full passage price. 695. or to any other cause beyond PAGE 178 . before or after the commencement of the voyage. Art. Art. Rights of Passengers Art. The right to passage. 699. 3. PASSENGERS ON SEA VOYAGE 1. or to force majeure. 693. 694. the captain may retain the goods belonging to the passenger. Nature of Contract Art. may not be transferred without the consent of the captain or of the consignee. when the latter is ready to leave the port. If the contract is rescinded. not conclusive evidence Defective and irregular B/L may be cured by other complementary documents G. the passengers shall be subject to the orders of the captain.
Held: The governing provisions are found in the Code of Commerce. the passengers shall only be entitled to the return of the passage money. In the Philippines. Art. In case of delay in the departure of the vessel. In case a voyage already begun should be interrupted. Even granting that the engine failure was a fortuitous event. and if it is due exclusively to the captain or ship agent they may furthermore demand indemnity for losses and damages. without being prevented by fortuitous event or force majeure. there is no law which requires shipowners to publish a schedule of the arrivals and departures of their vessels in the different ports of call. the right to damages and indemnity exists against a captain who fails to fulfill his undertaking or where the interruption has been caused by the captain exclusively. Art. but with a right to indemnify if the interruption should have been caused by the captain exclusively. As found by both courts below. unless the delay is due to an accidental cause or to force majeure. and without right to recover for losses and damages if the interruption is due to a fortuitous event or to force majeure. the passengers requesting the same shall be entitled to the return of the fare. Mechanical defects in the CC are not considered caso fortuito that exempts the CC from responsibility. without prejudice to criminal penalties which may prosper. there was no longer PAGE 179 . 614 provides that a captain who agreed to make a voyage and who fails to fulfill his undertaking. 698. it accounted only for the delay in the departure. the passengers have a right to remain on board and to be furnished food for the account of the vessel. When the vessel left Cebu. he may not be required to pay any increased price of passage. but his living expenses during the delay shall be for his own account. there was no fortuitous event or force majeure which prevented the vessel from fulfilling its undertaking of taking private respondents to Catbalogan. no matter what the number of passengers may be. making all the stops indicated in its itinerary. Without it. 698 also provides for the captain's liability. If the interruption should be by reason of the disability of the vessel.TRANSPORTATION AND MARITIME LAW the control of the captain or ship agent. and the passenger should agree to await the repairs. Art. If the delay should exceed 99ten days. The crucial factor then is the existence of a fortuitous event or force majeure. shall indemnify all the losses which his failure may cause. and which holds them liable in damages to passengers for any deviation from said schedule Issue: WON defendant is liable. A vessel exclusively destined to the transportation of passengers must take them directly to the port or ports of destination. the passengers shall be obliged to pay only the fare in proportion to the distance covered.
Art. The vessel was completely repaired when it left Cebu for Samar and Leyte. they informed the passengers that it would take only a few hours. They did not offer to refund the tickets of the passengers nor provide them transportation from Bacolod City to Catbalogan. The sailing schedule of the vessel xxx is subject to change without previous notice. it was not the vessels' sailing schedule that was involved." Even assuming that those conditions are applicable to case at bar. The complaint is directed not at the delayed departure the next day but at the by-passing of Catbalogan. their destination. petitioner did not comply with the same. Responsibilities of Captain Art. the carrier reserves the right to bring the passenger to his/her destination at the expense of the carrier or to cancel the tickets and refund the passenger the value of his/her ticket. Furthermore. In case the vessel cannot continue or complete the trip for any cause whatsoever. 614 and 698 of the Code of Commerce. conditions: 3. The passengers are also entitled to moral damages on account of the BF on the part of the carrier. 586 of the Code of Commerce. 4. Petitioner cannot rely on the conditions in small bold print at the back of the ticket reading: "The passenger's acceptance of this ticket shall be considered as an acceptance of the ff. The owner of a vessel and the ship agent shall be civilly liable for the acts of the captain under Art. In fact.TRANSPORTATION AND MARITIME LAW any force majeure that justified the by-passing a port of call. Knowing fully well that it would take 15 hours to repair the vessel. They did not give notice of the change of schedule. 702. The convenience or the interest of the passengers shall not obligate nor empower the captain to stand in-shore or enter places which may take the vessel out of her course. Besides. The interruption was not due to fortuitous event or force majeure nor to disability of the vessel. the passengers' right to indemnity is evident. 701. 11. The voyage to Catbalogan was interrupted by the captain upon instruction of management. after docking at Tacloban City. the conditions relied upon by petitioner cannot prevail over Arts. the vessel left for Manila to complete its voyage. nor to remain in the ports he must or is under the necessity of touching for a period longer than that required by the needs of navigation. the subsistence of the passengers during the voyage shall be deemed included in the price of the passage. perhaps this controversy would not have arisen. In the absence of an agreement to the contrary. It did not cancel the ticket nor did it refund the value of the tickets to private respondents. Had petitioner notified them previously and offered to bring them to their destination at its expense or refunded the value of the tickets purchased. Having been caused by the captain upon instructions of management. but should it be for their PAGE 180 .
complying with the provisions of case No. For the informations indicated he shall make use of the binnacle book. the list of passengers. The following duties are inherent in the office of captain: 1. and in his absence by the competent authority. Art. the horsepower of the engines. he shall record the decision adopted. and other incidents of navigation. signed by the marine official. entering specifically article by article. he shall enter all the amounts collected and paid for the account of the vessel. and the instrument of the expert visit or inspection. should it have been made at the port of departure. the distance covered. the health certificate. outfits. and the amounts invested in provisions. In case of the death of a passenger during the voyage the captain shall be authorized. repairs. 10 of Article 612 with regard to members of the crew. the course sailed. engines. Art. In the second book. or even of the passengers and crew. the roll of the persons who make up the crew of the vessel. rigging. 705. and all other expenses. as well as the imperfections and averages of the cargo. the charters or authenticated copies thereof. fuel. wages. the certificate of the registry proving the ownership of the vessel. To have on board before starting on a voyage a detailed inventory of the hull. the invoices or manifest of the cargo." he shall enter every day the condition of the atmosphere. 2. the prevailing winds. and the effects and consequence of the jettison. and of the steam or engine book kept by the engineer. and tackle. should there be any.TRANSPORTATION AND MARITIME LAW account. their wages and PAGE 181 . He shall also enter the damage suffered by the vessel in her hull engines. and all the obligations which encumber the same up to that date. placing at the beginning of each one a note of the number of folios it contains. tackle. In the first book. no matter what is its cause. to take the steps required by the circumstances. called the "accounting book". 3. and in cases of grave resolutions which require the advice or a meeting of the officers of the vessel. stating their domiciles. and other equipments of the vessel. stores. acquisition of rigging or goods. in case of necessity. the captain shall be under the obligation. the maneuvers executed. the rigging carried. and the contracts entered into with the crew. the navigation certificate. 612. To have a copy of this Code on board. and shall carefully take care of the papers and goods of said passenger which may be on board. the sources of the collection. To have three folioed and stamped books. which shall be called "log book. He shall furthermore enter therein a list of all the members of the crew. with respect to the body. to supply the food necessary for their sustenance at a reasonable price. rigging.
To demand a pilot at the expense of the vessel whenever required by navigation. ports of loading and unloading. To be on deck at the time of sighting land and to take command on entering and leaving ports. registry. and if she has the equipment required for good navigation. To make. 7. unless there is a pilot on board discharging his duties. with the officers of the crew. and rivers. In the same book he shall record the names and places of sailing of the passengers and the number of packages of which their baggage consists. 5. and principally the favorable season it takes place. and the amounts they may have received on accounts. if required by the shippers and passengers. He shall not spend the night away from the vessel except for serious causes or by reason of official business. either directly or by delivery to their families. and port of departure of the vessel. before receiving the freight. the officers nor the crew are acquainted. preserving a certificate of the memorandum of this inspection. and principally when a port. not to permit that any freight be carried on deck which by reason of its disposition. or river. In the third book. names of the shippers and of the consignees.TRANSPORTATION AND MARITIME LAW salaries. or a roadstead or anchoring place is to be entered with which neither he. when making a port in distress. he must hear the opinion of the officers of the vessel. before twenty-four hours have elapsed. without the precautions which are recommended for their packing. and have the consent of the shippers and of the agent. or weight makes the work of the sailors difficult. stating their marks and packages. canal. 8. and whether the rigging and engines are in good condition. called "freight book. and the price of the passage. 6." he shall record the entry and exit of all the goods. and if. the special character of the shipment. To present himself. roadsteads. which declaration shall be vised by the authority of by the consul if after examining the same it is found to be PAGE 182 . under their liability. and reason of arrival. and the freight earned. not to consent to any merchandise or goods of a dangerous character to be taken on. management and isolation. of its cargo. signed by all the persons who may have taken part therein. To remain constantly on board the vessel with the crew during the time the freight is taken on board and carefully watch the stowage thereof. and make a statement of the name. and in case of disagreement a third shall be appointed by the marine authority of the port. on account of the nature of the merchandise. The experts shall be appointed one by the captain of the vessel and the other one by the persons who request the examination. he allows merchandise to be carried on deck. and the two experts. and which might endanger the safety of the vessel. 4. in order to ascertain whether she is watertight. such as inflammable or explosive substances. an examination of the vessel. volume. to the maritime authority if in the Philippines and to the Filipino consul if in a foreign country. canals.
Art. the declaration must be made before the local authority. taking advantage of the semaphore. notify him the freight he may have received. 12. unless the damage arises from an act of the captain or of the crew. 13. etc. telegraph. according to the cases. and others. The provisions of Arts. in the presence of passengers as witnesses. before the competent authority or Filipino consul. To comply with the obligations imposed by the laws and rules of navigation. and. To observe the rules on the situation of lights and evolutions to prevent collisions. 16. To conduct himself according to the rules and precepts contained in the instructions of the agent. 14. in their absence. customs. until all hope to save her is lost. A passenger shall be considered a shipper of the goods he carries on board. To give an account to the agent from the port where the vessel arrives. of members of the crew. 9. 1733 to 1753 shall apply to the passenger's baggage which is not in his personal custody or in that of his employee. freight earned. in accordance with case 8 of this article. To take the steps necessary before the competent authority in order to enter in the certificate of the vessel in the registry of the vessels. Art. 10. health. the books and papers. and then the articles of most value. drawing up a detailed inventory. stating the name and domicile of the shippers. being obliged to prove in case of the loss of the books and papers that he did all he could to save them. To remain on board in case of danger to the vessel. In case of wreck he shall make the proper protest in due form at the first port reached. the rules in Articles 1998 and 2000 to 2003 concerning the responsibility of hotelkeepers shall be applicable. In the absence of marine officials or of the consul. and before abandoning her to hear the officers of the crew. advise him of his departure. before anything else. To put in a safe place and keep all the papers and belongings of any members of the crew who might die on the vessel.. within twenty-four hours. giving the captain the proper certificate in order to show his arrival under stress and the reasons therefor. the obligations which he may contract in accordance with Article 583. and give him any information and date which may be of interest. As to the other baggage. and the captain shall not be responsible for what the former may keep under his immediate and special custody. mail. (New Civil Code. stating therein all the incidents of the wreck.TRANSPORTATION AND MARITIME LAW acceptable. 1754. 11. 703.) PAGE 183 . and if he should have to take a boat he shall take with him. of the reason therefor. being liable for all that he may do in violation thereof. 15. abiding by the decision of the majority. and amounts borrowed on bottomry bond.
Laws applicable to a contract for the carriage of goods by sea: 1. 521 of the 74th Congress of the United States.with respect to vessels destined for foreign ports. governed by the Civil Code COGSA . torts. Q: Can the COGSA apply in domestic shipping? A: Generally. = what law applies? 1st: Civil Code 2nd: COGSA (it's more specific than Code of Commerce) . PAGE 184 . approved on April 16.does not apply to purely domestic transport . 1936.in foreign trade 3rd: Code of Commerce b. 521. contracts) c. From the Phils.applicable to all transportation of goods by sea in foreign trade to and from Philippine ports . or as limiting its application. Public Act No. Private carrier coming to the Phils. That the provisions of Public Act No.common carrier (Civil Code) . as it is hereby accepted to be made applicable to all contracts for the carriage of goods by sea to and from Philippine ports in foreign trade: Provided. Notes: In relation to Civil Code : Art. Distinguish . governed by law of foreign country Art. 65. the COGSA doesn't apply unless parties make it applicable.g. Where is the vessel going? a.TRANSPORTATION AND MARITIME LAW J. that nothing in this Act shall be construed as repealing any existing provision of the Code of Commerce which is not in force. 74the US Congress) Sec. 1. NO. in foreign trade 1st: COGSA (because it's more specific) 2nd: Code of Commerce 3rd: Civil Code (provisions not on common carriers e. to a foreign country: apply laws of such foreign country (Art.governed by law of place of destination. Q: In what situations does COGSA primarily apply? A: Where the parties expressly stipulate that COGSA shall govern their respective rights and obligations. Common carrier coming to the Phils. 1753 .goods from foreign country shipped to the Philippines. be accepted. 1766 . 1753) . No.private carrier 2. Carriage of Goods by Sea Act (Commonwealth Act. if shipped to a foreign country.
PAGE 185 . (1) The carrier shall be bound before and at the beginning of the voyage to exercise due diligence to(a) Make the ship seaworthy. Subject to the provisions of Section 6. 3. 1936). RESPONSIBILITIES AND LIABILITIES Sec. care.TRANSPORTATION AND MARITIME LAW EXCEPTION: when parties agree to make it apply. 2. This Act shall take effect upon its approval. Q: What application does COGSA have in carriage of passengers? A: None. (d) The term "ship" means any vessel used for the carriage of goods by sea. carriage. custody. merchandise. handling. except live animals and cargo which by the contract of carriage is stated as being carried on deck and is so carried. wares. and articles of ever kind whatsoever. including any bill of lading or any similar document as aforesaid issued under or pursuant to a charter party from the moment at which such bill of lading or similar document of title regulates the relations between a carrier and a holder of the same. Sec. (c) The term "goods" includes goods. When used in this Act(a) The term "carrier" includes the owner or the charterer who enters into a contract of carriage with a shipper. (b) The term "contract of carriage" applies only to contracts of carriage covered by a bill of lading or any similar document of title. insofar as such document relates to the carriage of goods by sea. 1. TITLE I Sec. the carrier in relation to the loading. under every contract of carriage of goods by sea. (e) The term "carriage of goods" covers the period from the time when the goods are loaded to the time when they are discharged from the ship RISKS Sec. 2. and discharge of such goods shall be subject to the responsibilities and liabilities and entitled to the rights and immunities hereinafter set forth. stowage. (Approved October 22. Applies only to carriage of goods.
quantity. that no carrier. (6) Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage. (c) The apparent order and conditions of the goods: Provided. (5) The shipper shall be deemed to have guaranteed to the carrier the accuracy at the time of shipment of the marks. or the master or agent of the carrier. issue to the shipper a bill of lading showing among other things(a) The loading marks necessary for identification of the goods as the same are furnished in writing by the shipper before the loading of such goods starts. (c) Make the holds. or agent of the carrier. shall be bound to state or show in the bill of lading any marks. (3) After receiving the goods into his charge the carrier. number. and supply the ship. in such a manner as should ordinarily remain legible until the end of the voyage. such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of PAGE 186 . on demand of the shipper. or weight which he has reasonable ground for suspecting not accurately to represent the goods actually received or which he has had no reasonable means of checking. and preservation (2) The carrier shall properly and carefully load. handle. number. fit and safe for their reception. care for. damages. and all other parts of the ship in which goods are carried. as the case may be. (4) Such a bill of lading shall be prima facie evidence of the receipt by the carrier of the goods as therein described in accordance with paragraphs (3) (a). carry. and the shipper shall indemnify the carrier against all loss. equip. refrigerating and cooling chambers. as furnished by him. and (c). carriage. and discharge the goods carried. or the quantity or weight. and weight. shall. as furnished in writing by the shipper.TRANSPORTATION AND MARITIME LAW (b) Properly man. (b) Either the number of packages or pieces. provided such marks are stamped or otherwise shown clearly upon the goods if uncovered. keep. quantity. The right of the carrier to such indemnity shall in no way limit his responsibility and liability under the contract of carriage to any person other than the shipper. and expenses arising or resulting from inaccuracies in such particulars. stow. master. of this section: (The rest of the provision is not applicable to the Philippines).
Notes: Prescriptive period under Section 3(6). that. be a "shipped" bill of lading: Provided.the carrier and the agent shall be discharged form liability in respect of loss or damage unless suit is brought within 1 year from: (1) in case of damaged goods: from the time delivery of the goods was made PAGE 187 . that if the shipper shall have previously taken up any document of title to such goods. arising from negligence. . the notice must given within three days of the delivery. covenant. he shall surrender the same as against the issue of the "shipped" bill of lading. shall be deemed to be a clause relieving the carrier from liability. but at the option of the carrier such document of title may be noted at the port of shipment by the carrier. or agent of the carrier to the shipper shall if the shipper so demands. or lessening such liability otherwise than as provided in this Act. or failure in the duties and obligations provided in this section. that fact shall not affect or prejudice the right of the shipper to bring suit within one year after the deliver of the goods or the date when the goods should have been delivered. fault. or agent with the name or names of the ship or ships upon which the goods have been shipped and the date or dates of shipment. the carrier and the receiver shall give all reasonable facilities to each other for inspecting and tallying the goods (7) After the goods are loaded the bill of lading to be issued by the carrier. be Said notice of loss or damage may be endorsed upon the receipt for the goods given by the person taking delivery thereof. master. and when so noted the same shall for the purpose of this section be deemed to constitute a "shipped" bill of lading. In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered: Provided. The notice in writing need not be given if the state of the goods has at the time of their receipt been the subject of joint survey or inspection. master. shall be null and void and of no effect. A benefit of insurance in favor of the carrier. either apparent or concealed. In the case of any actual or apprehended loss or damage. (8) Any clause. is not given as provided for in this section. if a notice of loss or damage. or agreement in a contract of carriage relieving the carrier of the ship from liability for loss or damage to or in connection with the goods. or similar clause. If the loss or damage is not apparent.TRANSPORTATION AND MARITIME LAW lading.
e. in case of misdelivery (delivery to wrong person) or conversion of the goods. such a provision is contrary to a provision of the COGSA since Sec. consignee or legal holder of B/L may invoke the prescriptive period and have the right to file suit within one year after delivery of the goods or failure to deliver.TRANSPORTATION AND MARITIME LAW (2) in case of non-delivery (i. 3(8) is void. 1 year period is a special prescriptive period. the rules on prescription found in the Civil Code shall apply (10 years for contracts. 1 year-prescriptive period in Sec. Loss contemplates only where no delivery at all was made by the carrier of the goods because the same had perished. when and where damage occurred Shipper. uniform worldwide Rationale behind the 3-day notice and relatively short prescriptive period: . 3 provides that even if a notice of loss or damage is not given as required.to discover who was at fault . Mere proposal for arbitration or fact that there have been initial negotiations does not suspend the running of the period for prescription NOTE: Prof. consignee or legal holder of bill may invoke prescriptive period although the proviso in Sec. provision in the bill excepting th owner form liability for loss or damage of cargo unless written notice is thereof was given to the carrier within 30 days.. that fact shall PAGE 188 . NCC? A: No. Q: Is the prescriptive period under the COGSA interrupted from the time of the making of extra-judicial demand or filing of judicial action as provided in Art. there is a case of loss from the point of view of the consignee or shipper. lost goods): from the date the goods should have been delivered Cases of misdelivery or conversion not covered. 4 years for tortious obligations) Shipper. Stipulation in bill limiting carrier's liability contrary to sec. 3 (6) applies only where there is loss or damage. e. gone out of commerce. 1155.g. If there is a misdelivery or conversion. Quimbo does not agree with this SC ruling. But prescriptive period does not apply to the action by an insurer as subrogee of the consignee.to provide carrier an opportunity to look for the lost goods . or disappeared in such a way that their existence is unknown or they cannot be recovered Hence. to determine. 3 (6) gives the impression that it is the shipper alone who can invoke the same.in case of transshipment.
TRANSPORTATION AND MARITIME LAW not prejudice the right of the shipper to bring suit within 1 year after delivery of the goods. Notice requirements: COGSA: Sec. 3(6) If loss or damage is apparent - protest as soon as receipt of goods If not apparent -> within 3 days of delivery Code of Commerce: Art. 366 apparent - protest at time of receipt non-apparent - within 24 hours after receipt WARSAW: Art. 26 in case of damage: of baggage - within 3 days from receipt of goods - within 7 days in case of delay: within 14 days from receipt failure to comply with the 3-days notice requirement under COGSA does not affect the right of the shipper to bring action provided he brings the same within 1 year To be distinguished from the notice requirement in the WARSAW convention and Code of Commerce, where the notice requirement is a condition precedent for the right of action against the shipowner to accrue. RIGHTS AND IMMUNITIES Sec. 4. (1) Neither the carrier not the ship shall be liable for loss or damage arising or resulting from unseaworthi ness unless caused by want of due diligence on the part of the carrier to make the ship seaworthy and to secure that the ship is properly manned, equipped, and supplied, and to make the holds, refrigerating and cooling chambers, and all other parts of the ship in which goods are carried fit and safe for their reception, carriage, and preservation, in accordance with the provisions of paragraph (1) of Section (3). Whenever loss or damage has resulted from unseaworthiness, the burden of proving the exercise of due diligence shall be on the carrier or other person claiming exemption under this section. (2) Neither the carrier not the ship shall be responsible for loss or damage arising or resulting from(a) Act, neglect, or default of the master, mariner, pilot, or the servants of the carrier in the navigation or in the management of the ship; (b) Fire, unless caused by the actual fault or privity of the carrier;
TRANSPORTATION AND MARITIME LAW (c) Perils, dangers, and accidents of the sea or other navigable water; (d) Act of God; (e) Act of war; (f) Act of public enemies; (g) Arrest or restraint of princes, rulers, or people, or seizure under legal process; (h) Quarantine restrictions; (i) Act or omission of the shipper or owner of the goods, his agent or representative;; (j) Strikes or lockouts or stoppage or restraint of labor from whatever cause, whether partial or general: Provided, that nothing herein contained shall be construed to relive a carrier from responsibility for the carrier's own acts: (k) Riots and civil commotions; (l) Saving or attempting to save life or property at sea; (m) Wastage in bulk or weight or any other loss or damage arising from inherent defect, quality, or vice of the goods; (n) Insufficiency of packing; (o) Insufficiency or inadequacy of marks; (p) Latent defects not discoverable by due diligence; and (q) Any other cause arising without the actual fault and privity of the carrier and without the fault or neglect of the agents or servants of the carrier, but the burden of proof shall be on the person claiming the benefit of this exception to show that neither the actual fault or privity of the carrier not the fault or neglect of the agents or servants of the carrier contributed to the loss or damage. (3) The shipper shall not be responsible for loss or damage sustained by the carrier or the ship arising or resulting from any cause without the act, or neglect of the shipper, his agents, or his (4) An deviation in saving or attempting to save life or property at sea, or any reasonable deviation shall not be deemed to be an infringement or breach of this Act or of the contract of carriage, and carrier shall not be liable for any loss or damage resulting therefrom: Provided, however, that if the deviation is for the purpose of loading or unloading cargo or passengers it shall, prima facie, be regarded as unreasonable. (5) Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the transportation of goods in an amount exceeding $500 per package of lawful money of the United States, or in case of goods not shipped in packages, per customary freight unit, or the equivalent of that sum
TRANSPORTATION AND MARITIME LAW in other currency, unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading. This declaration, if embodied in the bill of lading, shall be prima facie evidence, but shall not be conclusive on the carrier. By agreement between the carrier, master or agent of the carrier, and the shipper another maximum amount than that mentioned in this paragraph may be fixed: Provided, that such maximum shall not be less than the figure above named. In no event shall the carrier be liable for more than the amount of damage actually sustained. Neither the carrier nor the ship shall be responsible in any event for loss or damage to or in connection with the transportation of the goods if the nature or value thereof has been know ingly and fraudulently mis-stated by the shipper in the bill of lading. (6) Goods of an inflammable, explosive, or dangerous nature to the shipment whereof, the carrier, master or agent of the carrier, has not consented with knowledge of their nature and character, may at any time before discharge be landed at any place or destroyed or rendered innocuous by the carrier without compensation, and the shipper of such goods shall be liable for all damages and expenses directly or indirectly arising out of or resulting from such shipment. If any such goods shipped with such knowledge and consent shall become a danger to the ship or cargo, they may in like manner be landed at any place, or destroyed or rendered innocuous by the carrier without liability on the part of the carrier except to general average if any. Notes: Amount recoverable in case of loss: $500/package, even if not stipulated The plaintiff cannot dispute said limitation on the ground that it was not freely and fairly agreed upon or that it is against public policy, since the LAW ITSELF PROVIDES FOR SAID LIMITATION; THE SAME IS DEEMED READ INTO THEIR CONTRACT Package - means individual packaging of the goods - does not cover 1 container van Parties may agree to amount of liability less than $500 under Sec. 4(5). By providing that $500 is the maximum liability, the law does not disallow an agreement for liability at a lesser amount. Moreover, Art. 1749 of the NCC expressly allows th limitation of the carrier's liability. (Eastern v. Great American)
TRANSPORTATION AND MARITIME LAW SURRENDER OF RIGHTS AND IMMUNITIES RESPONSIBILITIES AND LIABILITIES AND INCREASE OF
Sec. 5. A carrier shall be at liberty to surrender in whole or in part all or any of his rights and immunities or to increase any of his responsibilities and liabilities under this Act, provided such surrender or increase shall be embodied in the bill of lading issued to the shipper. The provisions of this Act shall not be applicable to charter parties; but if bills of lading are issued in the case of a ship under a charter party, they shall comply with the terms of this Act. Nothing in this Act shall be held to prevent the insertion in a bill of lading of any lawful provisions regarding general average. SPECIAL CONDITIONS Sec. 6. Notwithstanding the provisions of the preceding section, a carrier, master or agent of the carrier, and a shipper shall, in regard to any particular goods be at liberty to enter into any agreement in any terms as to the responsibility and liability of the carrier for such goods, and as to the rights and immunities of the carrier in respect to such goods, or his obligation as to seaworthiness, (so far as the stipulation regarding seaworthiness is not contrary to public policy), or the care or diligence of his servants or agents in regard to the loading, handling, stowage, carriage, custody, care and discharge of the goods carried by sea; provided, that in this case no bill of lading has been or shall be issued and that the terms agreed shall be embodied in a receipt which shall be a nonnegotiable document and shall be marked as such. Any agreement so entered into shall have full legal effect: Provided, that this section shall not apply to ordinary commercial shipments made in the ordinary course of trade but only to other shipments where the character or condition of the property to be carried or the circumstances, terms and conditions under which the carriage is to be performed are such as reasonable to justify a special agreement. Sec. 7. Nothing contained in this Act shall prevent a carrier or a shipper from entering into any agreement, stipulation, condition, reservation, or exemption as to the responsibility and liability of the carrier or the ship for the loss or damage to or in connection with the custody and care and handling of goods prior to the loading on and subsequent to the discharge from the ship on which the goods are carried by sea.
When under the custom of any trade the weight of any bulk cargo inserted in the bill of lading is a weight ascertained or accepted by a third party other than the carrier or the shipper and the fact that the weight as ascertained or accepted is stated in the bill of lading. Sec.TRANSPORTATION AND MARITIME LAW Sec. 9. 12. Nothing in this Act shall be held to apply to contracts for carriage of goods by sea between any port of PAGE 193 . of the Revised Statutes of the United States. or (b) when issuing such bills of lading either in the surrender of any of the carrier's rights and immunities or in the increase of any of the carrier's responsibilities and liabilities pursuant to Section 5. As used in this Act the term "United States" includes its districts. 1916. as amended. Nothing contained in this Act shall be construed as permitting a common carrier by water to discriminate between competing shippers similarly placed in time and circumstances.) Sec. 11. then notwithstanding anything in this Act. 8. 1916. (Not applicable to the Philippines. and possessions: Provided. and the accuracy thereof at the time of shipment shall not be deemed to have been guaranteed by the shipper.) Sec. (c) in any other way prohibited by the Shipping Act. This act shall apply to all contracts for carriage of goods by sea to or from ports of the United States in foreign trade. (Not applicable to the Philippines. inclusive. the bill of lading shall not be deemed to be prima facie evidence against the carrier of the receipt of goods of the weight so inserted in the bill of lading. 13. The provisions of this Act shall not affect the rights and obligations of the carrier under the provisions of the Shipping Act. or under the provisions of Section 4281 to 4292. or of any amendments thereto. either (a) with respect to their right to demand and receive bills of lading subject to the provisions of this Act. or under the provisions of any other enactment for the time being in force relating to the limitation of the liability of the owners of seagoing vessels. territories. TITLE II Sec. Sec. The term "foreign trade" means the transportation of goods between the ports of the United States and ports of foreign countries. Title I. however. of this Act. 10. that the Philippine Legislature may by law exclude its application to transportation to or from ports of the Philippine Islands.
15. from time to time by proclamation. 14. that every bill of lading or similar document of title which is evidence of a contract for the carriage of goods by sea from ports of the United States in foreign trade. further. Sec. shall contain a statement that it shall have effect subject to the provisions of this Act. of the Title I of this Act. is suspended. COGSA. Any proclamation of suspension or rescission of any such suspension shall take effect on the date named therein. made before the date on which this Act is approved nor to any bill of lading or similar document of title issued. subject to the provisions of this Act. Notes: American Insurance vs Cia Maritima : contract of carriage from NY with final destination in Cebu. This Act shall take effect ninety days after the date of its approval. Upon the certification of the Secretary of Commerce that the foreign commerce of the United States in its competition with that of foreign nations is prejudiced by the provisions. and any provisions thereof which may have been thereafter made for carriage of goods by sea. whether before or after such date of approval in pursuance of any such contract as aforesaid. PAGE 194 . shall be subject to all provisions of law now or hereafter applicable to that part of Title I which may have thus been suspended. shall be subjected hereto as fully as if subject hereto by the express provisions of this Act: Provided. effective during any period when Title I hereof. The President may at any time rescind such suspension of Title I hereof. that any bill of lading or similar document of the title which is evidence of a contract for the carriage of goods by sea between such ports.TRANSPORTATION AND MARITIME LAW the United States or its possession: Provided. Transshipment was not a separate transaction from that originally entered into by the parties but was part of the carrier's contractual obligation.. or by the laws of any foreign country or countries relating to the carriage of goods by sea. however. Any contract for the carriage of goods by sea. but nothing in this Act shall apply during a period not to exceed one year following its approval to any contract for the carriage of goods by sea. or any part thereof. Sec. suspend any or all provisions of Title I of this Act for such periods of time or indefinitely as may be designated in the proclamation. and any time rescind such suspension of Title I hereof. COGSA is applicable despite the fact that from Manila to Cebu. or any of them. which date shall be not less than ten days from the issue of the proc lamation. the President of the United States may. the goods were transshipped on an interisland vessel. containing an express statement that it shall be subject to the provisions of this Act.
Article 38 of the aforesaid Convention provides that a Government on behalf of which this Convention has not been signed. the Senate of the Congress of the Philippines. 51 O. by its Resolution No. 1950. concurred in the adherence by the Republic of the Philippines Government to the said Convention & the said Protocol in accordance with the Philippine Constitution.TRANSPORTATION AND MARITIME LAW Sec. This Act may be cited as the "Carriage of Goods by Sea Act. shall be allowed to adhere thereto at any time after the Convention has come into force. WHEREAS. 1936.G. 5084 (October 1955). International Air Transport A. 1929 WHEREAS. a Convention for the Unification of Certain Rules Relating to International Transportation by Air & an Additional Protocol thereto relating to Article 2 of the Convention were signed at Warsaw by the plenipotentiaries of 32 countries. The Warsaw Convention. COGSA. 16. that the 1st paragraph of Art. April 16. subject to the reservation. 51 O.P. & the Government of the Republic of Poland was notified of said adherence PAGE 195 . 201. by means of a notification addressed to the Government of the Republic of Poland. TRANSPORTATION BY AIR AND THE ADDITIONAL PROTOCOL THERETO. 4933 (October 1955) MAKING PUBLIC THE ADHERENCE OF THE R. WHEREAS." Approved. the Republic of the Philippines Government has formally adhered to the said Convention its Additional Protocol.G. V. Presidential Proclamation No. as provided in the Additional Protocol. 19 adopted on May 16. 2 of the Convention shall not apply to international transportation that may be performed by the Republic of the Philippines. WHEREAS. TO THE CONVENTION FOR THE UNIFICATION OF CERTAIN RULES RELATING TO INTL.
FIRST ISSUE: W/NOT THE WARSAW CONVENTION IS UNCONSTITUTIONAL? PAGE 196 .2 of the Convention shall not apply to international transportation that may be performed by the Republic of the Philippines. The only criterion for the Warsaw Convention to be applicable is: it is applicable to ALL international transportation of persons. Notes: If common carrier. NOW. THEREFORE. NORTHWEST AIRLINES [210 S 256 (1992)] F: 1. to the end that the same and every article and clause thereof may be observed & fulfilled with good faith by the Republic of the Philippines and the citizens thereof. or goods performed by aircraft for hire.28 (1) of the Warsaw Convention. when the instrument of adherence was registered in accordance with Article 38 (2) of said Convention. pursuant to Art. a copy of which is hereto attached. despite a previous confirmation. baggage. Northwest moved to dismiss on the ground of lack of jurisdiction based on Art. where the complaint could be instituted in the territory of one of the contracting parties before the court of the (1) domicile of the carrier. then Warsaw Convention. took effect as from the 90th day after November 9. 1950. Republic of the Philippines President. the adherence of the Republic of the Philippines Government. 1950. and had to be waitlisted. Situations where Warsaw is applicable is in private carriers. International transport: where there's transport by AIR & there is a point of contact in 2 high contracting parties (countries which have acceded to the Convention). (3) where it has a place of business through which the contract had been made. A Filipino minor was informed by Northwest that he had no reservations for his flights.transporation of goods B. and. (2) principal place of business. and (4) place of destination. in pursuance of the aforesaid concurrence of the Senate of the Congress of the Philippines. and subject to the reservation as provided in the Additional Protocol that the First paragraph of Art. Civil Code first applies.g. He sued for damages.TRANSPORTATION AND MARITIME LAW on November 9. Ramon Magsaysay. E. Constitutionality SANTOS V. WHEREAS. 38(3) of said Convention. do hereby proclaim and make public the said Convention and said Protocol. be it known that I. transportation by PAL from Manila to San Francisco Federal Express .
The circumstance that the airline industry was still in infancy when the Convention was made. (1) court of domicile is Minnesota. In this case. 28 (1) of Warsaw Con.TRANSPORTATION AND MARITIME LAW HELD: No. 28 (1) provides that an action for damage must be brought at the option of the plaintiff: (a) before the court of the domicile of the carrier. Moreover. Santos having purchased a round trip-ticket from SFO-TYO-MNL. SECOND ISSUE: W/NOT THE WC SHOULD BE RENDERED IRRELEVANT BY THE DOCTRINE OF REBUS SIC STANTIBUS? HELD: No.A. The "ultimate destination" being San Francisco. the ff.A. alone. underscores the mandatory nature of Art. PAGE 197 . which is to regulate in a uniform manner the conditions of international transportation by air. (b) the court of its principal place of business. not being one of the courts mentioned in Art. the Warsaw Convention is a treaty commitment voluntarily assumed by the Philippine Government and as such. Although the case can be decided on other grounds without resolving the constitutional question. (d) the court of the place of destination.S. Art. (c) the court where it has a place of business thru w/c the contract had been made. 32. (4) place of destination is also San Francisco. has the force and effect of law. which indicates the places where the action for damages "must" be brought. Art. 28 (1). THIRD ISSUE: W/NOT THE REQUISITS OF THE WC IS MERELY A MATTER OF VENUE OR JURISDICTION? HELD: Jurisdiction (1) The wording of Art. the treaty since 1950 has not been rejected by the Philippine Government. (Check Art. does not have jurisdiction over the case. Peti tioner's allegation have not overcome this presumption. and hence the Philippines. The presumption is that this joint legislative-executive act was first carefully studied and determined to be constitutional before it was adopted. The changes recited by petitioner were not entirely unforeseen although they were expected in a general sense only. U. (2) This characterization is consistent with one of the objectives of the convention. (2) principal place of business of carrier is also U. is not sufficient justification for the rejection of the treaty at this time. FOURT ISSUE: W/NOT PHILIPPIN COURTS HAVE JURISDICTION OVER THIS CASE? HELD: No.41). then back to TYO.SFO. were not followed. is constitutional.S.28 (1). (3) place of business where contract was made was in San Francisco.
It shall apply equally to gratuitous transportation by aircraft performed by an air transportation enterprise. for the purposes of this Convention. C. Note however. even though that power is not a party to this convention. whether it has been agreed upon under the form of a single contract or of a series of contracts is to be performed entirely w/in a territory subject to the sovereignty. suzerainty.TRANSPORTATION AND MARITIME LAW The court called upon to determine the applicability of the limitation provision must first be vested with the appropriate jurisdiction. You can have a cause of action even if it is not: (a) death or wounding of passenger. baggage. (1) This convention shall apply to all international transportation of persons. or authority of the same High Contracting Party. that the limitations of liability in the Convention favors the carrier. (3) Transportation to be performed by several successive air carriers shall be deemed. luggage and goods. or goods performed by aircraft for hire.28 (1). (2) For the purpose of this convention the expression "international transportation" shall mean any transportation in which. Transportation without such an agreed stopping place between territories subject to the sovereignty. When Applicable Art. whether or not there be a break in the transportation or a transshipment. The case of Northwest is actually overbooking. are situated either within the territories of two High Contracting Parties. Notes: The enumeration of the causes of action in the WC is not an exclusive list. the place of departure and the place of destination. to be one undivided transportation. (b) damage or loss or destruction of checked baggage. But it can be done only if the action has first been commenced properly under the rules set forth in Art. suzerainty. mandate. or authority of another power. if it has been rendered by the parties as a single operation. suzerainty. 1. or authority of the same High Contracting Party shall not be deemed to be international for the purposes of this Convention. PAGE 198 . it can avail itself of the limitations set forth in this article. or within the territory of a single High Contracting Party. Delay still a cause of action under WC. (c) delay in transportation of passengers. If the carrier is indeed is indeed not guilty of WILLFUL MISCONDUCT. mandate. if there is an agreed stopping place within a territory subject to the sovereignty. according to the contract made by the parties. mandate.
any checked baggage. in any place whatsoever. whether in an airport or on board an aircraft.baggage. to have been the result of an event which took place during the transportation by air. (3) The period of the transportation by air shall not extend to any transportation by land. by sea. (2) The transportation by air within the meaning of the proceeding paragraph shall comprise the period during which the baggage or the goods are in charge of the carrier. or goods. Liabilities Under the Convention Art. 17. (1) This convention shall apply to transportation performed by the state or by legal entities constituted under public law provided it falls within the conditions laid down in Art . an air carrier PAGE 199 . if the occurrence which caused the damage so sustained took place during the transportation by air. (2) This convention shall not apply to transportation performed under the terms of any international postal convention.1. or of damage to. if the conditions therein specified are present. or in the case of a landing outside an airport.TRANSPORTATION AND MARITIME LAW Art. or transshipment. (1) The carrier shall be liable for damage sustained in the event of the destruction or loss of. NORTHRWEST V. The carrier shall be liable for damage sustained in the event of the death or wounding of a passenger or any other bodily injury suffered by a passenger. for the purpose of loading. 18. Art. Under petitioner's theory. 19. If however.any damage is presumed. The carrier shall be liable for damage occasioned by delay in the transportation by air of passengers. or any goods. Neither the provisions of said articles nor others regulate or exclude liability for other breaches of contract by the carrier. such transportation takes place in the performance of a contract for transportation by air. Art. The said articles merely declare the carrier liable for damages in the enumerated cases. D. if the accident which caused the damage so sustained took place on board the aircraft or in the course of any of the operations of embarking or disembarking. subject to proof to the contrary. 2. delivery. or by river performed outside of an airport. CUENCA [14 S 1063 (1965)] ISSUE: W/NOT CUENCA HAS A CAUSE OF ACTION THOUGH NOT AMONG THOSE MENTIONED IN THE WC? HELD: Yes.
Italy. the equivalent capital value of the said payments shall not be exceed 125. E. in accordance with the law of the court seized of the case. PAGE 200 . Nevertheless. (Now $100. Pablo. but her luggage (where her speech was) was delayed. The WC has been held inapplicable where there was proof of malice or bad faith attributable to its officers and employees. in accordance w/ the law of the court to w/c the case is submitted. there was no bad faith on the part of the employees. (1) In the transportation of passengers the liability of the carrier for each passenger shall be limited to the sum of 125. The WC denies to the carrier availment of the provisions which exclude or limit his liability. an Associate UP Professor and research grantee of the Philippine Atomic Energy Agency was scheduled to speak in a UN meeting in Ispra.TRANSPORTATION AND MARITIME LAW would be exempt from any liability for damages in the event of its absolute refusal. is considered as willful misconduct. The WC does not regulate or exclude liability for other breaches of contract by the carrier or misconduct of its officers and employees or for some particular or exceptional damage. which is absurd. 2. the carrier and the passenger may agree to a higher limit of liability. She returned to Manila before the meeting. and arrived a day after the meeting. an air carrier is made liable for damages for delay in the transportation by air of passengers.000 francs. Limitations on Liability RE: PASSENGERS Art. was awarded because of the presence of some special species of injury caused to Dr. to comply with a contract of carriage. luggage or goods. Under the WC. damages may be awarded in the form of periodical payments. It does not regulate or exclude liability for other breaches of contract by the carrier.000 francs.22. The WC also limits the liability of the carrier to 250 francs per kilo of the total weight of the package. The WC does not operate as an absolute limit of the extent of an airline's liability. if the damage is caused by his willful misconduct or by such default on his part as. She arrived in Milan a day before the meeting.000) Where. IAC [192 SCRA 10 (1990)] F: Dr. Felipa Pablo. or if the damage is caused by any agent of the carrier acting w/in the scope of his employment. ALITALIA V. by special contract. ISSUE: W/NOT THE WC SHOULD APPLY TO LIMIT ALITATLIA'S LIABILITY? HELD: No. however. Nominal damages however. in bad faith. Here.
Such provisions have been held to be a part of the contract of carriage.18 & 19 any action for damages. Inasmuch as Pangan failed to declare any higher value for his PAGE 201 . PAN AM v. Art. can only be brought subject to the conditions and limit set out in this convention.17. In that case. invoking Art. Art.24 (1). (1) In the cases covered by Arts. IAC (164 SCRA) ISSUE: WON Pangan is bound by such Warsaw provisions & hence is entitled only to $600 ($20 standard X 30 kilos) ---. Any provision tending to relieve the carrier of liability or to fix a lower limit that which is laid down in this convention shall be null and void. 23.TRANSPORTATION AND MARITIME LAW RE: BAGGAGE/GOODS (2) In the transportation of checked baggage and of goods. (2) In the case covered by Art. which shall remain subject to the provisions of this convention. 24. a special declaration of the value of the delivery and has paid a supplementary sum if the case so requires. A contract limiting liability upon an agreed valuation does not offend against the policy of the law forbidding one from contracting against his own negligence. HOWEVER FOUNDED.w/o prejudice to the question as to who are the persons who have the right to bring suit and what are their respective rights. the liability of the carrier shall be limited to 5. you can still sue under Warsaw. & is valid & binding upon the passenger regardless of the latter's lack of knowledge or assent to the regulation. (3) As regards objects of w/c the passenger takes charge himself. (4) The sums mentioned above shall be deemed to refer to the French franc consisting of 65 1/2 milligrams of gold at the standard of fineness of nine hundred thousandths. the liability of the carrier shall be limited to a sum of 250 francs per kilogram (Now $20 per kilo) . These sums may be converted into any national currency in round figures. at the time when the package was handed over to the carrier. the carrier will be liable to pay a sum not exceeding the declared sun.YES. but the nullity of any such provision shall not involve the nullity of the whole contract. unless he proves that the sum is grater that the actual value to the consignor at delivery. the provisions of the preceding paragraph shall also apply. NOTES: Even if you base your claim on quasi-delict. unless the consignor has made.000 francs per passenger.
(e) A statement that the transpo. Nevertheless. NOTES: Q: In what cases can carrier NOT invoke limitations? PAGE 202 . Since there is no evidence that PET had declared a higher value for her lost luggage for w/c the corresponding value. Such contract is governed by Art. the Warsaw Con. (b) The place of departure & of destination.25.TRANSPORTATION AND MARITIME LAW luggage & to pay add'l charges. (1) For the transpo.YES. in accordance w/ the law of the court to w/c the case is submitted. irregularity. is the damage is caused under the same circumstances by any agent of the carrier acting w/in the scope of his employment. SC has granted damages on the ground of fraud or bad faith due to the personal misconduct of airline employees. and that if he exercises that right. F. This case. of passengers the carrier must deliver a passenger ticket w/c shall contain the ff. however. is considered to be equivalent to wilful misconduct. or loss of the passenger ticket shall not affect the existence or the validity of the contract of transportation. (d) The name & address of the carrier/s.22(2). When limitations unavailable Art. w/c shall none the less be subject to the rules of this convention. (1) The carrier shall not be entitled to avail himself of the provisions of this convention w/c exclude or limit his liability. Indeed. PAN AM (CA CASE) Was TC correct? --. (2) Similarly the carrier shall not be entitled to avail himself of the said provisions. the alteration shall not have the effect of depriving the transportation of its intl. character. PanAm's liability is limited to $600. if the carrier accepts a passenger w/o a passenger ticket having been delivered he shall not be entitled to avail himself of those provisions of this Convention w/c exclude or limit his liability. (2) The absence. as stipulated at the back of the ticket. Art. FELICIANO v. 3. should apply. the contract of carriage of PET's baggage is based on the conditions in the airline. (c) The agreed stopping places. particulars: (a) The place & date of issue. is subject to the rules relating to liability established by this convention. if the damage is caused by his wilful misconduct or by such default on his part as. provided that the carrier may reserve the right to alter the stopping places in case of necessity.
limit on liability can be availed of --.g. in his MNL-Europe-NYK. accepting goods w/o air waybill/baggage w/o baggage check. PAGE 203 . Pablo. ALITALIA v. The only time when WC isn't applicable is when it's not intl.TRANSPORTATION AND MARITIME LAW A: 1. wilfull misconduct (Art. CA (165 SCRA) F: Vinluan.3-2). ISSUE: WON Warsaw Con. It just can't avail of the limitation on liability. Thus it can still invoke the provisions on NOTICE or PRESCRIPTION/LACK OF CAUSE OF ACTION. NOTES: His entire trip. has been held inapplicable where there was proof of malice or bad faith attributable to its officers & employees. TWA v. HOWEVER. was downgraded from 1st class to economy & was issued refund application.g. e. But if suit is brought w/in 2 years. The carrier can invoke prescription. MNL-SFO via PAL } one continuing SFO-NYK via United } ticket Hence. Nominal damages however. 4. Q: Can carrier rely on WC if it was guilty of wilfull misconduct? A: YES.NO. no bad faith of EES. Warsaw can be applied. He sued in CFI for breach of contract & bad faith.IAC (supra) The Convention does not regulate or exclude liability for other breaches of contract by the carrier or misconduct of its officers and employees or for some particular or exceptional damage.25) 2.SFO-MNL flight. & case was filed beyond the 2 year requirement. to court where action is brought.25 w/c says that the WC doesn't apply entirely. was awarded because of the presence of some special species of injury caused to Dr. HERE. default amounting to wilful misconduct accdg. if injury appears in SFO-NYK. carrier may be liable for a higher amount than the limitation. There was obvious discrimination & humiliation to w/c Vinluan was subjected. accepting passengers w/o passenger ticket (Art. ACCRA lawyer. is equal to one transport. air transport. even though he availed of the services of other airlines. 3. E. If damage wasn't one of the enumerations in the WC. The Con. (His NYK-SFO flight particularly) He also noticed that white Caucasian passengers who checked in later than him were given preference in 1st class seats. Such inattention & lack of care for interest of its passengers amount to bad faith w/c entitles passenger to moral damages. There is nothing in Art. w/c became available due to "no show" passengers.
(b) the court of its principal place of business. Conditions of Liability Art.TRANSPORTATION AND MARITIME LAW F. within 3 days from the date of receipt in the case of BAGGAGE and 7 days from the date of receipt in the case of GOODS. xxx PAGE 204 . the person entitled to delivery must complain to the carrier forthwith after the discovery of the damage. (1) An action for damage must be brought at the option of the plaintiff. 28(1) provides that an action for damage must be brought at the option of the plaintiff: (a) before the court of the domicile of the carrier.26. no action shall lie against the carrier. (d) the court of the place of destination. save in the case of fraud on his part. in the territory of one of the High Contracting Parties. In case of DELAY the complaint must be made at the latest w/in 14 days from the date on w/c the baggage or goods have been placed at his disposal. (4) Failing complaint w/in the times aforesaid. or before the court at the place of destination. NORTHWEST (supra) Art. NOTE: No notice requirement in case or a person's death or injury. (3) Every complaint must be made in writing upon the document of transportation or by separate notice in writing dispatched w/in the times aforesaid. (2) Questions of procedure shall be governed by the law of the court to w/c the case is submitted. 27. SANTOS v. (2)In case of damage. 28. Art. either before the court of the domicile of the carrier or of his principal place of business . (c) the court where it has a place of business thru w/c the contract had been made. or where he has a place of business through w/c the contract has been made. In the case of death of the person liable. and at the latest. an action for damages lies in accordance w/ th terms of this convention against those legally representing his estate. (1) Receipt by the person entitled to the delivery of baggage of goods w/o complaint shall be prima facie evidence that the same have been delivered in good condition & in accordance w/ the document of transpo. Art.
(1) court of domicile is U. then back to TYO. (3) place of business where contract was made was in San Francisco. PAGE 205 . Any clause contained in the contract an all special agreements entered into before the damage occurred by which the parties purport to infringe the rules laid down by this convention.28 (1). (2) principal place of business of carrier is also US.S.SFO.. shall be null and void. if the arbitration is to take place within one of the jurisdictions referred to in the first paragraph of Article 28. (4) place of destination is also San Francisco. for the transportation of goods. Nevertheless. Santos having purchased a round trip-ticket from SFO-TYO-MNL.TRANSPORTATION AND MARITIME LAW In this case. Minnesota. whether by deciding the law to be applied or by altering the rules as to jurisdiction. subject to this convention. were not followed. Art. does not have jurisdiction over the case. the ff. 32. The "ultimate destination" being San Francisco. and hence the Phils.. arbitration clauses shall be allowed. not being one of the courts mentioned in Art.
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