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Atty. Vivencio F.

Abao

H1

-1-

CODE OF COMMERCE: TRANSPORTATION OVER LAND


(ARTS. 358, 370-71)

(ART. 359,
JURISPRUDENCE)

(ARTS. 363-365)

(ART. 366,
JURISPRUDENCE)

(ARTS. 368, 369)

(ART. 373)

TIME TO DELIVER

ROUTE

DELIVERY
PARTIAL DEFECTIVE

CLAIM/SUIT

MISDELIVERY/NONDELIVERY

MULTI-CARRIERS

1. when no period fixed:


carrier
must
forward
goods
in
the
first
shipment of same or
similar goods.

1. if route agreed upon,


carrier may not change it
unless by reason of force
majeure; otherwise, carrier
is liable for losses suffered
by goods, and for indemnity
stipulated.

2. when period fixed:


carrier
must
deliver
goods within time fixed.
DELAY IN DELIVERY
in case of delay,
carrier is liable for:

the

1. indemnity stipulated in
the bill of lading.
2.
if
no
stipulation,
damages due to delay
which may not exceed
the current price of the
goods on the day and
place of destination.
3. special damages, like
unrealized
profit,
if
carrier foresaw or had
notice of circumstances
leading to the probable
occurrence
of
such
damage.
4. full value of goods, if
consignee
should
exercise abandonment of
the goods by advising
carrier accordingly prior
to arrival at destination.

2. if no agreed route, carrier


must select shortest, least
expensive and practically
passable route (Art. 1747).

the carrier must deliver


the goods in the same
condition and quantity in
which
they
were
received, according to
the bill of lading.
1. in case of partial
delivery, consignee may
refuse to receive those
delivered if they cannot
be used independently of
those not delivered.
2. if the goods delivered
were rendered useless
for sale or consumption,
consignee may refuse to
receive.
3. if the goods delivered
are damaged to such an
extent that their value is
diminished, carrier must
pay the difference in
value
as
judged
by
experts.
in the first 2 cases,
consignee may exercise
abandonment
and
be
entitled to full value of
goods.

purpose
of
following
requirements: so carrier can
check validity of claims
while facts are still fresh
and
documents
still
available.
1. when the damage is
ascertainable
from
the
outside part of the package,
the claim must be made at
the time of receipt.
2. when the damage is
ascertainable only by the
opening of the package, the
claim against carrier must
be made within 24 hours
following receipt (longer
period may be stipulated).
3. in both cases, the claim
must
be
made
before
payment of transportation
charge.
4. a provisional claim need
not state in detail list of
goods lost or damaged, so
long as carrier can make
reasonable verification.
5.
claim
is
condition
precedent to right of action,
which must be filed within 2
year from delivery of goods
or denial of claim.
6. sufficient and reasonable
shorter period may be
stipulated in the bill of
lading.

the carrier must deliver the


goods to the consignee or
legitimate holder of the bill
of lading.
1. the shipper may order
the return or retention of
the goods by carrier, prior
to appearance of consignee
or legitimate holder of ill of
lading.
2. the carrier is liable for
damages if it delivers to the
wrong person (misdelivery).
3. if the carrier makes no
delivery or refuses to deliver
(non-delivery),
the
consignee may sue for
conversion and damages.
4. if consignee cannot be
found in the place indicated
in bill of lading, or refuses
to pay transportation charge
or to receive goods, the
carrier may deposit goods in
its warehouse or the court;
such deposit has the legal
effect of delivery.
claim
not
a
condition
precedent to action, which
must be filed within 4 years
if no written contract or 10
years if written contract.

This
refers
to
an
arrangement where several
carriers
successively
transport the goods, or by
a single through bill of
lading issued by a carrier
and honored by the other
carriers.
1. in transportation of
goods
by
successive
carriers, the last carrier
assumes the obligation of
the previous carriers.
2. but the last carrier, if
not directly responsible for
the loss or damage, may
proceed
against
the
previous carriers.
3. shipper/consignee have
right of action against
carrier
who
executed
transportation contract, or
the other carriers who
received
goods
without
reservation.
4. carriers with reservation
are
not
relieved
of
responsibilities for their
own acts.

Atty. Vivencio F. Abao

-2-

VESSELS/PERSONS IN MARITIME COMMERCE


VESSELS

SHIPOWNERS/AGENTS

A. Definition:

A. Ship agent (may be shipowner; not a civil agent):

1.
those
with
motive
power.
2.
means
of
water
transportation (P.D. 474)

1. entrusted with provisioning vessel.


2. represents vessel in port where she is (Art. 586).
3. represents shipowner in judicial/extrajudicial acts
(Art. 595)

B. Excluded:
1. local and foreign military
vessels
2.
bancas
and
other
watercrafts of less than 3
tons gross capacity (P.D.
474)
3.
small
watercrafts
engaged in river and bay
traffic (Art. 835)

B. Civilly liable for:

C. Classified as personal
property,
ownership
of
which to be recorded in
registry of vessels.
D.
Warranty
seaworthiness:

of

1. equipped for the voyage


and manned with sufficient
number
of
competent
officers and crew.
2. shipper/passenger not
required to inquire into
vessels
seaworthiness,
genuineness of its licenses,
and
compliance
with
maritime laws.
3.
vessel
must
be
seaworthy at the star of
voyage; carrier not liable if
seaworthiness occurs later
due to fault of shipper or
passenger.

1.
2.
3.

4.

1.

2.
3.

OFFICERS

PASSENGERS

A. Captain of big vessels for


high sea or coastwide trade;
master for smaller vessels for
coastwide trade.

A. Officers must be duly


licensed (PRC and MARINA).

A. Refund due to voyage


suspension
or
interruption:

B. Qualifications:
1.
2.

acts and obligations of captain contracted to


repair, equip, and provision vessels (Art.
586).
indemnities arising from conduct of captain
in the care of goods and passengers carried
by vessel (Art. 587).
obligation contracted by captain even
exceeding his powers and privileges,
provided made for the benefit of vessel (Art.
588).
damages in case of collision by reason of the
fault, negligence, or lack of skill of captain or
any member of the complement.

C. Doctrine of limited liability and


abandonment (Arts. 587, 590, and 837):

CAPTAIN/MASTER

right

of

because of real and hypothecary nature of


maritime law, liability of shipowner/agent is
limited o value of vessel, equipment and
freight during the voyage.
shipowner/agent may exempt themselves
from
liability
by
abandoning
vessel,
equipment or freight.
Creditor
cannot
refuse
offer
of
abandonment.

3.

2.
3.
4.

where shipowner/agent is at fault or


concurrently negligent with captain.
where shipowner/agent allows his vessel to
embark in an unseaworthy condition.
where vessel in insured.
in Workmens Compensation Act.

1.
2.
3.
4.

include

the

sailing mate
second mate
third mate
marine
engineer
(Arts. 627-633)

C. Civilly liable for:


1.
2.
3.
4.
5.

damage to vessel
due
to
lack
of
skill/negligence.
theft,
robberies,
mutiny by crew.
abuse of power.
unjustified deviation.
losses,
fines
and
confiscation imposed
due to violation of
laws and regulations
(Arts. 618-620).

D. Defense of force majeure:


1.
2.

D. Doctrine not applicable:


1.

Filipino citizen.
with
skill
and
capacity to command
and direct vessel.
duly
licensed
by
MARINA (Arts. 609,
882)

B.
Officers
following:

3.
4.

proximate and only


cause.
due
diligence
to
prevent or minimize
loss.
no delay.
protest without 24
hours.

SUPERCARGOES
in maritime law, a person
specially employed by the
owner of cargo to take
charge
of
and
sell
merchandise which have
been shipped, to purchase
returning cargoes, and to
receive freight, as he may
be authorized (Arts. 649651).

1. if due to fault of
captain or ship agent,
passenger has right to
refund of fare and to
damages.
2. if due to force majeure
or fortuitous event, only
return of fare or part
thereof in proportion to
distance traveled before
interruption (Art. 697).
B. Baggage:
1.
passenger
is
considered
a
shipper
insofar as the goods he
carries on board.
2. insofar as the goods in
the immediate custody of
the
passenger,
the
captain is not responsible,
unless the damage arises
from his act or the crews
(Art. 703).

Atty. Vivencio F. Abao

-3-

DAMAGES AND ACCIDENTS IN MARITIME COMMERCE


AVERAGES
Averages are:
1. all extraordinary or
accidental
expenses
incurred during the voyage
for preservation of the
vessel and/or cargo.
2.
all
damages
and
deterioration suffered by
vessel from departure to
arrival, and by goods from
loading to unloading (Art.
806).
2 Kinds:
1. simple or particular all
expenses
and
damages
caused to vessel or cargo
which have not incurred to
the benefit and common
profit
of
all
persons
interested in the vessel or
cargo (Art. 809). Liable:
owner of the goods which
gave rise to the expense of
suffered the damage (Art.
810).
2. general or gross all the
damages
and
expenses
which
are
deliberately
caused in order to save the
vessel and/or cargo from a
real and known risk (Art.
811).
C.
Elements
average:
1.
2.

of

gross

common danger.
arising
from
accidents
of
sea/disposition of
authority.

3.
peril
imminent
and
ascertained.
4. part of vessel or cargos
deliberately sacrificed.
5. successful saving of vessel or
cargo.
6. proper legal steps and
authority taken.
D. Effect: all person with interest
in the vessel and cargo saved
shall contribute (Art. 812).
Example: total value of vessel
and cargos is P10 million broken
down as follows:
Vessel
Cargo
1
Cargo
2
Cargo
3

=
=

P5,000,000.00
P2,000,000.00

P2,000,000.00

P1,000,000.00

Cargo 3 is jettisoned to lighten


vessel during storm. Vessel and
Cargos 1 and 2 saved thereby.
They must contribute to owner
of Cargo 3 as follows:
Vessel
(50%)
Cargo 1
(20%)
Cargo 2
(20%)

P500,000.00

P200,000.00

P200,000.00

the balance of P100,000.00 is


Cargo 3s own contribution.

E. Proper legal step and


authority:
to incur expenses and
cause
damage
of
general average, there
must be resolution of
the
captain
after
deliberation with other
officers
and
after
hearing
of
person
present interested in
cargo (Art. 813).
F. Entitlement:
1. to be entitled to
indemnity
of
gross
average,
owner
of
cargo must prove its
existence by means of a
bill of lading, shipowner
must prove by means
of inventory.
2. claims for averages
must exceed 5% of the
interest in the cargo or
in the vessel. In the
foregoing example, only
a portion of Cargo 3
worth P10,000.00 is
jettisoned. This is only
1% of the total value of
P1,000,000.00 of Cargo
3, and hence, its owner
is
not
entitled
to
indemnity.

ARRIVAL UNDER
STRESS
A. Meaning:
arrival of the vessel at
the nearest and most
convenient port, when
the captain believes
the
vessel
cannot
continue the voyage to
the port of destination
(Art. 819).
once cause of arrival
under stress ceases,
captain must continue
voyage, otherwise, he
is liable for damage
caused by delay (Art.
825).
B. Justifications:
1. lack of provisions
(not due to negligence
or
failure
to
take
necessary provision).
2. well-founded fear of
seizure
by
pirates
(manifest and based on
positive and justifiable
facts).
3. accident disabling
vessel to navigate.
4.damage to vessel
caused
by
malice,
negligence, want of
foresight, or lack of
skill of captain (Art.
820).

COLLISION/ALLISION

SHIPWRECKS

A. Definition:

A. Meaning:

collision is the impact of two


moving vessels; allision is the
striking of a moving vessel a
stationary one.

when
a
vessel
is
damaged rendering her
unable to navigate, or
when the vessel is lost at
sea.

in case of risk of collision,


each vessel must alter course
to starboard (right) so as to
pass on the portside (left) of
the other vessel (Rule 18,
International Rules of the
Road).
B. Liability:
1. if collision due to force
majeure or fortuitous event,
each vessel and its cargo
liable for its own damage
(Art. 830).
2. if collision due to fault,
negligence, or lack of skill of
captain or any member of the
vessels complement, owner
of vessel at fault should
indemnify.
3. if both vessels at fault,
each shall suffer its own
damage, and be solidarily
liable for losses and damage
suffered by their cargos.
4. owner of a vessel is liable
if it caused another vessel to
collide with a third vessel.
5. doubtful collision, same as
#1 (above).

B. Liability
1. generally, each owner,
whether of the vessel or
cargo shall bear his own
loss.
2.
if
shipwreck
or
stranding
caused
by
malice, negligence or
lack of skill of captain, or
vessel was insufficiently
repaired and equipped,
ships
agent
and/or
shipper may demand
indemnity
from
the
captain.

C. Condition precedent
for
recovery
of
damages/losses:
maritime protest under
oath by the captain
within 24 hours, before
competent
authority
where
collision
took
place at first port of
arrival (Art. 835).

Atty. Vivencio F. Abao

-4-

H2
COMMON CARRIER: TRANSPORTATION OF GOODS
(ART. 1766)
GOVERNING LAWS
1.
2.
3.

New Civil Code


Code of Commerce
Special Laws

(ART. 1732)
COMMON CARRIER
1. engaged in the business of
carrying or transporting goods
or passengers
a. whether as principal
or ancillary business
b. whether on regular/
scheduled basis or
occasional/unschedul
ed basis
2. offers its service to the
public
a.
whether
to
the
general population
b.
or narrow segment of
general population
3. for compensation or fixed
price or rate
4. control of operation/cargo

(ART. 1733)
EXTRAORDINARY
DILIGENCE/RESPONSIBILITY

(ART. 1735)
LOSS, DETERIORATION
OR DESTRUCTION

1. to transport with greatest


skill and utmost foresight
2. utmost vigilance of very
cautious person, according to
all circumstances
(ARTS. 1736-1738)
DURATION OF
EXTRAORDINARY
RESPONSIBILITY
1. from time goods are
unconditionally
placed
in
possession of and received by
common carrier for transport
until actual or constructive
delivery to consignee or person
with right to receive.
2. even when goods are
temporarily unloaded or stored
in transit, unless shipper used
right of stoppage in transitu.
3.even during time of storage
at warehouse of common
carrier at place of destination,
until consignee is advised of
goods arrival and has had
opportunity to remove or
dispose of them.

PRESUMPTION OF
NEGLIGENCE
1. not conclusive but
disputable presumption
2. may be overcome by
contrary evidence of
defenses.
(ART.1753)
law of the country of
destination shall govern
liability
of
common
carrier
for
loss,
destruction
or
deterioration of goods.

(ART. 1734)
DEFENSES
EXEMPTING OR
MITIGATING
LIABILITY
1. natural disaster
like
flood,
storm,
earthquake,
lightning.

2. act of public
enemy
in
war,
whether international
or civil.
3. act or omission of
owner or shipper of
goods.

(ARTS. 1739-1743)
CONDITIONS TO AVAIL OF
DEFENSES

1.
a.
b.

proximate and only


cause.
exercise
of
diligence
to
prevent
or
minimize loss.

2. same
(above).

3.
a.
b.

as

in

#1

if proximate cause,
exempting.
if
contributory
negligence,
mitigating.

4. character of goods
or defect in the
packing or container.

4.
exercise
of
due
diligence to forestall or
prevent losses.

5. order or act of
competent
public
authority.

5. with power to issue


the order.

(ARTS. 1744-1752)
STIPULATION LIMITING
LIABILITY
1. Requisites:
a. in writing
b. with
valuable
consideration other
than the services of
the common carrier
c. reasonable, just and
not
contrary
to
public policy
2. Void Stipulation:
a. unreasonable
b. unjust
c. contrary to public
policy
3. Valid Stipulation:
a.
limited to value of
goods appearing in
bill of lading
b.
fixed sum that is
reasonable and just
and agreed upon
c.
delay due to strike
or riot
4.
Factors
to
be
considered:
a. refusal
to
carry
goods
unless
stipulation limiting
liability is signed by
shipper
b. delay or deviation
c. lack of presence of
competition

Atty. Vivencio F. Abao

-5-

TRANSPORTATION OF PASSENGERS
(ARTS. 1733, 1755)
EXTRAORDINARY
DILIGENCE
1. to carry passengers
safely as far as human care
and foresight can provide.
2. using utmost diligence of
a very cautious person.
3. with due regard for all
the circumstances.
NO INSURER OR ABSOLUTE
SAFETY
the common carrier is not
required to exercise all the
care, skill or diligence the
human mind can conceive,
nor free the passenger from
all possible risks.
PASSENGER
one who travels in a public
conveyance by virtue of an
express of implied contract
with the common carrier,
paying fare or what is the
equivalent thereof.

(JURISPRUDENCE)
CONTRACT OF CARRIAGE

(ART. 1756)

(ARTS. 1757, 1758)

(ARTS. 1761, 1762)

(DEFENSES)

LIMITATION OF LIABILITY

DUTY OF PASSENGERS
1. to observe ordinary
diligence to avoid injury to
himself.

OF

1. liability cannot be
dispensed or lessened by
posting
of
notices,
statements on tickets or
otherwise.

1.
exercise
of
extraordinary diligence by
common carrier.

disputable and may be


overcome by proof of
exercise of extraordinary
diligence.

2. in gratuitous carriage
stipulation to limit liability
may be valid, but not for
willful
act
or
gross
negligence.

(ARTS. 1759, 1760)

3. reduced far does not


justify limiting liability.

DEATH OR INJURY TO
PASSENGER

A. Commencement:
1. (liberal view) when a
person
offers
to
be
transported, placing himself
in the care and control of the
common carrier who accepts
him as such passenger.
2. (strict view) there is actual
boarding or placing of a part
of the passengers body in
the vehicle.
B. Termination:
When the passenger alights
from the vehicle at the place
of
destination
and
has
reasonably opportunity to
leave the common carriers
premises.

PRESUMPTION
NEGLIGENCE

NON-EXEMPTING OR NONLIMITING
1. common carrier is liable
due to negligence or willful
act of employee, even if
done beyond scope of
authority or in violation of
orders.
2. liability does not cease
with exercise of ordinary
diligence
by
common
carrier.
3. liability is not eliminated
or limited by stipulation
posting
of
notices,
statements on the tickets.

2. contributory negligence
of passenger does not bar
recovery of damages but
reduces amount thereof.
(ART. 1763)
ACTS OF COPASSENGERS OR
STRANGERS
1. common carrier is
responsible in case of
death or injury on account
of willful act or negligence
of other passengers or
strangers -2. if employees could
have
stopped
or
prevented the act or
omission by exercise of
ordinary diligence.

2. negligent act of the


passenger is proximate
cause of death or injury.
3. employees could not
have
prevented
by
ordinary
diligence
the
willful act or negligence of
other
passengers
or
strangers which caused
injury or death.
4. liability is mitigated by
the
contributory
negligence of passenger
or his failure to observe
ordinary diligence to avoid
injury.
5. stipulation to limit
liability
is
valid
in
gratuitous carriage, if no
willful
act
or
gross
negligence by common
carrier.

Atty. Vivencio F. Abao

-6-

RECOVERABLE DAMAGES
ACTUAL

MORAL

NOMINAL

compensation for pecuniary


loss suffered (Art. 2219).

compensation for physical


suffering, mental anguish,
fright, serious anxiety, etc.,
which are the proximate
result of the wrongful act or
omission (Arts. 2217, 2219).

awarded
for
vindication
or
recognition of a right
which
has
been
invaded or violated
(Art. 2221).

award
is
more
nominal but less
actual
damages
2224).

Grounds for award:

Grounds
recovery:

1. when pecuniary loss


was
suffered
but
the
amount
thereof cannot
from the very nature
thereof be proved with
certainty.

Kinds:
1. Art. 2200
a. actual loss
b. unrealized profit
2. Art. 2205
a.
impairment
of
earning capacity
b.
injury to business
standing
or
commercial credit
3. Art. 2206
a. fixed indemnity
b. loss
of
earning
capacity formula:
[2/3
(80-age
of
death)
x
gross
income] 2

1. in breach of contract of
carriage, there must be fraud,
bad faith, or death (Art.
2220, Jurisprudence).
2.
in case of death, heirs
entitled to moral damages.
3. only injured passengers
entitled to moral damages
due
to
his
injury
(Jurisprudence).
Factors to determine:

4. Arts. 2208-2213
a. attorneys fee
b. interest

1. social, political, official and


financial
standing
of
passenger (Jurisprudence).

When recoverable:
1. proof of loss, injury or
impairment.
2. proof of actual amount
thereof with reasonable degree
of certainty premised upon
competent proof.

2. degree/extent of mental
anguish (Jurisprudence).
3.
Sentimental
value
property (Art. 2218).

of

TEMPERATE

for

1. breach of legal duty


or invasion of legal
right even if no actual
damage resulted or
none is shown.
2. no actual, moral, or
temperate
damages
awarded.

than
than
(Art.

When recoverable:

2. when the amount can


be proved but the plaintiff
failed to present evidence
therefore or submitted the
wrong evidence, nominal
damages
is
awarded
(Jurisprudence).

LIQUIDATED

EXEMPLARY

damages agreed upon in a


contract in case of breach
thereof (Art. 2226).

imposed
by
way
of
example or correction for
the common good (Art.
2229).

amount stipulated shall be


equitably
reduced
if
iniquitous/unconscionable
(Art. 2227).
Example:
1. valid stipulation on
limited amount of liability.
2. stipulated indemnity in
case of delay.
When recoverable:
1. proof of existence of
contract.
2. proof of breach of
contract, or of delay in
compliance or fulfillment.

When recoverable:
1. there must be an
award of actual, moral,
temperate or liquidated
damages.
2. crime is attended by
aggravating
circumstance.
3. gross negligence in
commission
of
quasidelict.
4. contract (of carriage)
is violated in wanton,
fraudulent,
reckless,
aggressive or malevolent
manner.
When not recoverable:
1. there was good faith.
2.
employer
is
not
subsidiarily liable unless
he participated in or
abetted the crime.

Atty. Vivencio F. Abao

-7-

SPECIAL LAWS IN TRANSPORTATION (A)


CARRIAGE OF GOODS BY SEA ACT
Only the carriers liability is extinguished if
no suit is filed within 1 year by shipper,
COGSA is a US law which was adopted by consignee, or insurer. The prescriptive
the RP as C.A. No. 65 in 1936, to govern period does not apply to suits filed by
contracts for the carriage of goods by sea insured against insurer.
to and land from the RP in foreign trade.
E. Liability (Sec. 4[5]):
B. Primary Law
1. Maximum of $500 per package or, if
COGSA is governing law, if stated in bill of
not shipped in packages, per
lading or similar document that contract
customary freight unit (e.g. metric
of carriage is subject to its provisions
ton of bulk shipment).
(Sec. 13). Note effect on Art. 1753 of
2. Nature and value of goods may be
NCC.
declared by shipper and inserted in
bill of lading; declaration is prima
C. Bill of Lading
facie evidence and not conclusive on
carrier.
Prima facie evidence of the receipt by the
3. Shipper and carrier may agree on
carrier of the goods as described therein.
another maximum amount, but not
(Sec. 3[4]). Contrary evidence may be
more than amount of damage
presented.
actually sustained.
A. Origin/Purpose

D. Prescriptive Period (Sec. 3[6]).


1.

2.
3.
4.
5.

6.

If loss or damage is apparent or


external, notice in writing must be
given to carrier or agent at time of
removal of goods by person entitled
to delivery.
If loss or damage is not apparent,
within 3 days of delivery.
If no notice is given, there is prima
facie evidence of delivery of goods as
described in bill of lading.
Notice is not needed if goods jointly
surveyed or inspected at time of their
receipt
Whether notice of loss/damage is
given or not, suit must be filed within
1 year after delivery of when goods
should
have
been
delivered,
otherwise, prescribed.
If misdelivery, prescriptive period for
suit is 10 years for breach of written
contract or 4 years for quasi-delict.

When the packages are shipped in a


container supplied by carrier and the
number of such units is stated in the bill
of lading, each unit and not the container
constitute the package.
F. No liability (Sec. 4[6]):
1.
2.
3.
4.

If nature or value of goods knowingly


and
fraudulently
misstated
by
shipper.
If damage resulted from dangerous
nature of shipment loaded without
consent of carrier.
If unseaworthiness not due to
negligence of carrier.
If deviation was to save life or
property at sea.

A. Origin/Purpose

WARSAW CONVENTION
E. Prescriptive Period (Arts. 26 & 29)

Signed first by 30 countries in October


1929 to establish uniform system of rules
for international air transportation of
persons, baggage, or goods. RP concurred
in 1950.

1.

B. Liability of Carrier (Arts. 17-21):

3.

1.
2.

3.

Death or injury happening on board


aircraft
or
during
embarking/disembarking.
Destruction, loss, or damage to
checked baggage or goods while in
the charge of the carrier, whether
on board aircraft or in airport.
Damage occasioned by delay.

2.

4.

F. Defendants (Art. 30):


1.

Defense:
Exercise
of
extraordinary
diligence;
impossibility
to
prevent
damage; contributory negligence.
C. Excluded:
Under WC, to be prosecuted as quasidelict or breach of contract under New
Civil Code: refusal to bard, bumping off,
downgrading, disrespect, abusive and
insulting language, etc.
D. Limited Liability (Arts. 22-25):
1. 125,000F per passenger, unless
higher limit is agreed upon.
2. 250F
per
kilo
of
checked
baggage/good unless declaration of
higher value and added payment
made.
3. 5,000F per handcarried baggage.
Condition: no willful misconduct
Stipulation to lower limit or to exempt
from liability is void.

In case of damage, written


complaint within 3 days from
receipt of baggage, and 7 days
from receipt of goods.
In case of delay, 14 days from
delivery of goods/baggage.
No action lies if complaint
beyond period, unless there is
fraud.
Action must be filed within 2
years from date of arrival, or
when ought to arrive, or when
transportation stopped.

2.

In case of successive carriers,


the carrier in which the accident
or delay occurred, unless, by
express agreement first carrier
assumed
liability
for
entire
journey.
As regards baggage or goods,
passenger/consignor may sue
against
first
carrier;
passenger/consignee against last
carrier; or against carrier in
which
destruction,
loss,
or
damage occurred; all carriers
jointly and severally liable.

G. Jurisdiction (Art. 28):


Plaintiff has option to file for damages at:
1. Domicile of carrier
2. Principle place of business of
carrier
3. Where carrier has business
through which contract made
4. Place of destination

Atty. Vivencio F. Abao

-8-

SPECIAL LAWS IN TRANSPORATION (B)


SALVAGE LAW
(R.A. 2616)
A. Definitions:
1.

2.

3.

Service rendered to preserve the


goods or ship which the owner
has either abandoned in distress
at sea or is unable to protect or
secure.
Compensation to one by whose
assistance a ship or its cargo has
been saved from impending
danger or recovered from actual
loss.
Vessel or cargo recovered from
abandonment at sea.

B. Elements of valid salvage:


1.
2.
3.

Marine peril
Voluntary service
Success in whole or part

SHIP MORTGAGE DECREE


(P.D. 1521)
A. Purpose of mortgage:

1.

To finance the construction, acquisition,


purchase of vessel, or initial inspection 2.
thereof.
B. Conditions for preferred mortgage:
1.
2.
3.

Registration with PCG


Affidavit of good faith
No waiver of preferred status

3.
4.

C. Preferred mortgage has priority over all


claims against the vessel, except:
1. Taxes, crews wages, general
average,
salvage,
damages
arising out of torts
2. Preferred mortgages registered
prior in time
3. Maritime lien arising prior to 5.
registration
of
preferred
mortgage (Sec. 17)
D. Maritime lien for necessities:
Any person furnishing repairs, supplies,
tonnage, use of dry dock or other
necessities to any vessel, upon the order
of its owner or the latters authorized
representatives, shall have a maritime
lien on the vessel which may be enforced
by a suit in rem and it shall be necessary
to allege or prove that credit was given to
the vessel (Sec. 21)

LAND TRANSPORTATION TRAFFIC


CODE (R.A. 4136)
A motor vehicle must be registered for
the current year, as a condition for its
operation on a public road or highway.
A person can still drive a vehicle even
without possessing his drivers license,
albeit he may be violating traffic rules.
(Manuel v. CA, 227 SCRA 29).
A person driving with an expired and
unrenewed license is deemed not to
have any license at all.
Insurance requires an authorized
driver who is either the insured of a
person driving on insureds order or
with his permission, provided he
abides with licensing rules. A driver
with expired Traffic Violation Receipt
(TVR) or Temporary Operation Permit
(TOP) is not an authorized driver
within the meaning of insurance policy.
Mortgage,
attachment,
or
other
encumbrances on a motor vehicle must
be registered and recorded on the face
of the Certificate of Registration.

IATA TARIFF RULES


Under the rules of the International Air
Transportation Association (IATA), an
airplane ticket is valid for one year.
That is the time allowed the passenger to
begin and complete his trip. A passenger
ca no longer use an expired ticket to
complete his trip. He must purchase a
new ticket for the remaining portion of his
journey (Air France v. CA, 126 SCRA
449).

Atty. Vivencio F. Abao

-9-

CONTRACTS IN MARITIME COMMERCE (B)


MULTI-MODAL TRANSPORT
A. International Trade

FREIGHT FORWARDING
A. Forwarding Agent

Transport of goods is by more than one


carrier or mode of transportation.
Containerization
enhances
transport
capabilities in the transfer of goods from
ship to truck, train, plane, or other ship.

It receives and arranges to forward or


send the goods to their destination by the
instrumentality of the actual carrier,
without
assuming
the
role
and
responsibility of the carrier, and is
compensated for his services by the
shipper. He is an agent and a
warehouseman for the shipper, and must
exercise the care and diligence of a
prudent man.

B. Definition
Multi-modal transport operator (MTO)
means any person who concludes a multimodal contract and assumes responsibility
for the performance thereof by a carrier.
Multimodal transport contract means a
single contract for the carrier of goods by
at least two different modes of transport.
Considering the variety of cultures,
languages, and commercial practices of
both ends of the trade, it is reasonable to
let one qualified operator organize and be
responsible and accountable for the entire
transport chain (UNCTAD-ICC Rules for
Multi-modal Transport)

B. Freight Forwarder
A transport intermediary which publishes
its own tariff, issues its own bill of lading,
and assumes all responsibilities of a
common carrier without operating its own
vessel. This Nonvessel Operating Common
Carrier (NVOCC) acts a shipper in relation
to the actual carrier, and as a carrier to
the shipper. He charges for the entire
distance, and assumes responsibility for
the transportation of the goods from point
of receipt to point of destination.

ARRESTRE/STEVEDORING
A. Stevedoring means all works performed on board
vessel, such as loading or unloading cargo, stowing
inside hatches, compartments, and on decks or open
cargo spaces on bard vessel. May include other
services like:
1.
2.
3.
4.
5.

Stevedoring refers to the handling of the cargo in the


holds of the vessel or between the ships tackle and
the holds of the vessel.
B. Arrastre means the set of shore-based cargo
handling activities which include the following:
1.

C. Cargo Consolidator
It consolidates small shipments for
various
consignors/consignees
by
procuring vessel/container space from
carriers and issuing its own bill of lading.
Its destination agents distribute the small
shipments to the consignees named in the
consolidators manifest.

Rigging/unrigging of ships gears


Opening or closing of hatches
Snatching, centering to the hatch, opening,
passing of cargo
Providing standard stevedoring gears and
equipment as required by cargo type
Also: cleaning holds, shifting of cargoes,
shoring/unshoring
of
cargoes,
lashing/unlashing of cargoes, rebagging and
sweeping,
and
stuffing/unstuffing
of
containers on board vessel.

2.

3.
4.
5.

Receive/load cargo from/to ships tackle with


the use of dock gangs and cargo handling
equipment
Check cargo by marks and quantity,
acknowledge and sign tally sheets, sort, pile,
stow, and classify cargoes in sheds/open
storage/warehouse, if not taken/delivered
from truck
Check and recoup bad order and damaged
cargoes caused by contractor
Secure cargo from pilferage or losses while
under cargo handlers custody
Provide manpower, equipment, and such
other necessary cargo handling gears for
receiving/
stowing/
delivery/
transfer/
shifting/ pelletizing cargo

Arrastre refers to the handling of cargo on the wharf or


between the establishment of the consignee or shipper
and the ships tackle.

CONTRACT OF TOWAGE
A. Definition
A contract for hire of services
by which a vessel is hired to
tow another vessel from one
part
to
another
for
a
consideration.
B. Entitled
Only the owner of the towing
vessel
can
ask
for
compensation for the towage.
Not the captain, even if the
owner waived the claim for
the towage, unless the owner
assigned or conveyed his
right to the captain.

Atty. Vivencio F. Abao

- 10 -

PUBLIC SERVICE
PUBLIC UTILITIES
Renders services essential to
general public.
Impressed with public interest
and concern.

REGULATORY AND FRANCHISING BODIES

C.A. 146
(1936)

P.D. 1
(1972)

E.O.s
LTO/LTFRB (land transport)
TRB (toll road)

BOT
(transportation)
Subject to POLICE POWER which
is legislative prerogative/power

PSC
(Public Service
Commission)

NTC
(Communication)

PCG/MARINA (water
transport)
PPA (ports)
CAB (air transport)
MIAA (NAIA airport)
CAAP (other airports)

FUNCTIONS
A. Franchising/Licensing
1.
2.
3.

B. Regulation
1.

2.

LTO/LTFRB (land transport)


TRB (toll road)

1936-1972
ERB-ERC (power)
NEA (electric
cooperatives)

BPW
(power/waterworks)
CONGRESS delegates its power
and responsibilities to regulate
public utilities

NWRB (waterworks)
LWUA (water districts)

1.
2.

4.

Regulatory bodies/Administrative
and Quasi-Judicial Agencies
POTESTAS
DELEGATA
DELGARI POTEST

NON

Cancellation or suspension of
CPN/CPCN; imposition of fine.
(Reasons: e.g. unreliable service,
frequent accidents)
Due process: notice and hearing.
(Reasons: franchise is property
and not merely privilege; nonimpairment
of
contract
if
investment made).

C. Rate Fixing/Determination

3.

Special cases:
1. Local Government (Local Autonomy Code)
- franchising of tricycles
2. Special Economic Zones: CDC & SBMA
- communication franchises within their respective zones

Regulatory bodies grant CPC;


grant of CPCN requires prior
congressional franchise.
Requirements: Filipino citizenship,
financial capability, public need.
Due process: notice and hearing.

Quasi-judicial function
Goal: balance between private
and public demands; just and
reasonable rate for both.
Fair return on investment vs.
confiscatory measures.
Affordability vs. discrimination