petitioner and the passengers who died in the mishap rests on a contract of
CHAPTER VIII carriage. But assuming that petitioner is liable for a breach of contract of
PERSONS WHO TAKE PART IN MARITIME COMMERCE SHIPOWNERS
AND SHIP AGENTS
ARTICLE 586. The shipowner and the ship agent shall be civilly liable for
the acts of the captain and for the obligations contracted by the latter to
repair, equip, and provision the vessel, provided the creditor proves that
the amount claimed was invested therein.
By ship agent is understood the person entrusted with the provisioning of
a vessel, or who represents her in the port in which she may be found.
ART. 587. 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
vigilance over the goods, which the vessel carried; but he may exempt
himself therefrom by abandoning the vessel with all her equipment and
the freight he may have earned during the voyage.
The Limited Liability Rule.
Chua Yek Hong v. Intermediate Appellate Court, Mariano Guno and
Dominador Olit
Civil Law; Common Carriers; Shipagent; The term “shipagent” includes
shipowner; Liability of shipowner and shipagent.—The term “shipagent” as
used in the foregoing provision is broad enough to include the shipowner
(Standard Oil Co. vs. Lopez Castelo, 42 Phil. 256 [1921]). Pursuant to said
provision, therefore, both the shipowner and shipagent are civilly and directly
liable for the indemnities in favor of third persons, which may arise from the
conduct of the captain in the care of goods transported, as well as for the
safety of passengers transported.
Same; Right of abandonment; Direct liability is moderated and limited by
shipagent’s or shipowner’s right of abandonment of the vessel and earned
freight.—However, under the same the vessel.
Same; Provisions of the Civil Code on Common earners would not have any
effect on the principle of limited liability for shipowners or shipagents.—What
about the provisions of the Civil Code on common carriers? Considering the
“real and hypothecary nature” of liability under maritime law, these provisions
would not have any effect on the principle of limited liability for shipowners or
shipagents. As was expounded by this Court: “In arriving at this conclusion,
the fact is not ignored that the ill-fated, S.S. Negros, as a vessel engaged in
interisland trade, is a common carrier, and that the relationship between the
carriage, the exclusively ‘real and hypothecary nature’ of maritime law
operates to limit such liability to the value of the vessel, or to the insurance
thereon, if any. In the instant case it does not appear that the vessel was
insured.”
Same; Same; Same; Same; Same; Primary law on common carriers is the
Civil Code and in default thereof the Code of Commerce and other special
laws are applied.—In other words, the primary law is the Civil Code (Arts.
1732-1766) and in default thereof, the Code of Commerce and other special
laws are applied. Since the Civil Code contains no provisions regulating
liability of shipowners or agents in the event of total loss or destruction of the
vessel, it is the provisions of the Code of Commerce, more particularly
Article 587, that govern in this case.
RATIONALE ON THE REAL AND HYPOTHECARY LIABILITY OF
SHIPOWNER; EXCEPTIONS
 “Without the principle of limited liability, a shipowner and investor in
maritime commerce would run the risk of being ruined by the bad faith
or negligence of his captain, and the apprehension of this would be
fatal to the interest of navigation.”
 “As evidence of this ‘real’ nature of the maritime law, 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 to retain the cargo and the embargo and detention of
the vessel even in cases where the ordinary civil law would not
allow more than a personal action against the debtor or person
liable.
 It will be observed that these rights are correlative, and naturally so,
because if the agent can exempt himself from liability by abandoning
the vessel and freight money, thus avoiding the possibility of risking
his whole fortune in the business, it is also just that his maritime
creditor may for any reason attach the vessel itself to secure his claim
without waiting for a settlement of his rights, by a final judgment, even
to the prejudice of a third person.”
 The limited liability rule, however, is not without exceptions, namely:
1. where the injury or death to a passenger is due either to the
fault of the shipowner, or to the concurring negligence of the
shipowner and the captain
2. where the vessel is insured; and
3. in workmen’s compensation claims.
EFFECT OF THE NEW CIVIL CODE PROVISIONS ON COMMON
CARRIER ON THE REAL AND HYPOTHECARY NATURE OF LIABILITY
UNDER MARITIME LAW
 Considering the "real and hypothecary nature” of liability under
maritime law, the Civil Code provisions would not have any effect on
the principle of limited liability for shipowners or ship agents
 the primary law is the Civil Code (Arts. 1732- 1766) and in default
thereof, the Code of Commerce and other special laws are applied.
Since the Civil Code contains no provisions regulating the liability of
shipowners or agents in the event of total loss or destruction of the
vessel, it is the provisions of the Code of Commerce, more particularly
Article 587, that govern in this case.
Liability of shipowner extends to value of vessel and insurance
proceeds thereon.
Pedro Vasquez, Soledad Ortega, Cleto Bagaipo, Agustina Virtudez,
Romeo Vasquez and Maximina Cainay v. The Court of Appeals and
Filipinas Pioneer Lines Inc.
Torts; Common Carriers; Damages; Elements to consider in sustaining a
case of “caso fortuito.”—Upon the evidence and the applicable law, we
sustain the trial Court. “To constitute a caso fortuito that would exempt a
person from responsibility, it is necessary that (1) the event must be
independent of the human will; (2) the occurrence must render it impossible
for the debtor to fulfill the obligation in a normal manner; and that (3) the
obligor must be free of participation in, or aggravation of, the injury to the
creditor.” In the language of the law, the event must have been impossible to
foresee, or if it could be foreseen, must have been impossible to avoid.
There must be an entire exclusion of human agency from the cause of injury
or loss.
Same; There is no “caso fortuito” where a ship captain proceeded en route
despite a typhoon advice close to the area where vessel will pass.—Under
the circumstances, while, indeed, the typhoon was an inevitable occurrence,
yet, having been kept posted on the course of the typhoon by weather
bulletins at intervals of six hours, the captain and crew were well aware of
the risk they were taking as they hopped from island to island from Romblon
up to Tanguingui. They held frequent conferences, and oblivious of the
utmost diligence required of very cautious persons, they decided to take a
calculated risk. In so doing, they failed to observe that extraordinary
diligence required of them explicitly by law for the safety of the passengers
transported by them with due regard for all circumstances and unnecessarily
exposed the vessel and passengers to the tragic mishap. They failed to
overcome that presumption of fault or negligence that arises in cases of
death or injures to passengers.
Same; Same; Same; Board of Marine Inquiry’s conclusion that ship captain
was not negligent is not binding on the Court where said finding is not
complete.—While the Board of Marine Inquiry, which investigated the
disaster, exonerated the captain from any negligence, it was because it had
considered the question of negligence as “moot and academic,” the captain
having “lived up to the true tradition of the profession.” While we are bound
by the Board’s factual findings, we disagree with its conclusion since it
obviously had not taken into account the legal responsibility of a common
carrier towards the safety of the passengers involved.
Same; Same; Same; Liability of shipowner extends to value of vessel and
insurance proceeds thereon.—With respect to private respondent’s
submission that the total loss of the vessel extinguished its liability pursuant
to Article 587 of the Code of Commerce as construed in Yangco vs. Laserna,
73 Phil. 330 [1941], suffice it to state that even in the cited case, it was held
that the liability of a shipowner is limited to the value of the vessel or to the
insurance thereon. Despite the total loss of the vessel therefore, its
insurance answers for the damages that a shipowner or agent may be held
liable for by reason of the death of its passengers. Vasquez vs. Court of
Appeals, 138 SCRA 553, No. L-42926 September 13, 1985
A shipowner may be held liable for injuries to passengers
notwithstanding the exclusively real and hypothecary nature of
maritime law if fault can be attributed to the shipowner.
Negros Navigation Co., Inc. v. The Court of Appeals, Ramon Miranda,
Sps. Ricardo and Virginia De La Victoria
Civil Law; Negligence; Court finds that Capt. Santisteban and the crew of the
M/V Don Juan failed to take steps to prevent the collision or at least delay
the sinking of the ship and supervise the abandoning of the ship.—In finding
petitioner guilty of negligence and in failing to exercise the extraordinary
diligence required of it in the carriage of passengers, both the trial court and
the appellate court relied on the findings of this Court in Mecenas v.
Intermediate Appellate Court, which case was brought for the death of other
passengers. In that case it was found that although the proximate cause of
the mishap was the negligence of the crew of the M/T Tacloban City, the
crew of the Don Juan was equally negligent as it found that the latter’s
master, Capt. Rogelio Santisteban, was playing mahjong at the time of
collision, and the officer on watch, Senior Third Mate Rogelio De Vera,
admitted that he failed to call the attention of Santisteban to the imminent
danger facing them. This Court found that Capt. Santisteban and the crew of
the M/V Don Juan failed to take steps to prevent the collision or at least
delay the sinking of the ship and supervise the abandoning of the ship.
Same; Same; Adherence to the Mecenas case is dictated by the Court’s
policy of maintaining stability in jurisprudence in accordance with the legal
maxim “stare decisis et non quieta movere.”— Adherence to the Mecenas
case is dictated by this Court’s policy of maintaining stability in jurisprudence
in accordance with the legal maxim “stare decisis et non quieta movere”
(Follow past precedents and do not disturb what has been settled.) Where,
as in this case, the same questions relating to the same event have been put
forward by parties similarly situated as in a previous case litigated and
decided by a competent court, the rule of stare decisis is a bar to any
attempt to relitigate the same issue.
Same; Same; A shipowner may be held liable for injuries to passengers
notwithstanding the exclusively real and hypothecary nature of maritime law
if fault can be attributed to the shipowner.— The next issue is whether
petitioner is liable to pay damages notwithstanding the total loss of its ship.
The issue is not one of first impression. The rule is well-entrenched in our
jurisprudence that a shipowner may be held liable for injuries to passengers
notwithstanding the exclusively real and hypothecary nature of maritime law
if fault can be attributed to the shipowner.
Aboitiz Shipping Corporation v. New India Assurance Company, Ltd.
Common Carriers; Ships and Shipping; Doctrine of Limited Liability; An
exception to the limited liability doctrine is when the damage is due to the
fault of the shipowner or to the concurrent negligence of the shipowner and
the captain.—It bears stressing that this Court has variedly applied the
doctrine of limited liability to the same incident—the sinking of M/V P. Aboitiz
on October 31, 1980. Monarch, the latest ruling, tried to settle the conflicting
pronouncements of this Court relative to the sinking of M/V P. Aboitiz. In
Monarch, we said that the sinking of the vessel was not due to force
majeure, but to its unseaworthy condition. Therein, we found petitioner
concurrently negligent with the captain and crew. But the Court stressed that
the circumstances therein still made the doctrine of limited liability applicable.
Our ruling in Monarch may appear inconsistent with the exception of the
limited liability doctrine, as explicitly stated in the earlier part of the Monarch
decision. An exception to the limited liability doctrine is when the damage is
due to the fault of the shipowner or to the concurrent negligence of the
shipowner and the captain. In which case, the shipowner shall be liable to
the full-extent of the damage. We thus find it necessary to clarify now the
applicability here of the decision in Monarch.
Same; Same; Same; From the nature of their business and for reasons of
public policy, common carriers are bound to observe extraordinary diligence
over the goods they transport according to all the circumstances of each
case.—From the nature of their business and for reasons of public policy,
common carriers are bound to observe extraordinary diligence over the
goods they transport according to all the circumstances of each case. In the
event of loss, destruction or deterioration of the insured goods, common
carriers are responsible, unless they can prove that the loss, destruction or
deterioration was brought about by the causes specified in Article 1734 of
the Civil Code. In all other cases, common carriers are presumed to have
been at fault or to have acted negligently, unless they prove that they
observed extraordinary diligence. Moreover, where the vessel is found
unseaworthy, the shipowner is also presumed to be negligent since it is
tasked with the maintenance of its vessel. Though this duty can be
delegated, still, the shipowner must exercise close supervision over its men.
Same;To limit itself to the amount of insurance proceeds, the shipowner has
the burden of proving that the unseawor-thiness of its vessel was not due to
its fault or negligence.—In the present case, petitioner has the burden of
showing that it exercised extraordinary diligence in the transport of the goods
it had on board in order to invoke the limited liability doctrine. Differently put,
to limit its liability to the amount of the insurance proceeds, petitioner has the
burden of proving that the unseaworthiness of its vessel was not due to its
fault or negligence. Considering the evidence presented and the
circumstances obtaining in this case, we find that petitioner failed to
discharge this burden. It initially attributed the sinking to the typhoon and
relied on the BMI findings that it was not at fault.
However, both the trial and the appellate courts, in this case, found that the
sinking was not due to the typhoon but to its unseaworthiness. Evidence on
record showed that the weather was moderate when the vessel sank. These
factual findings of the Court of Appeals, affirming those of the trial court are
not to be disturbed on appeal, but must be accorded great weight. These
findings are conclusive not only on the parties but on this Court as well.
Same; Same; Same; Board of Marine Inquiry (BMI); The findings of the
Board of Marine Inquiry (BMI) are not deemed always binding on the courts.
—In contrast, the findings of the BMI are not deemed always binding on the
courts. Besides, exoneration of the vessel’s officers and crew by the BMI
merely concerns their respective administrative liabilities. It does not in any
way operate to absolve the common carrier from its civil liabilities arising
from its failure to exercise extraordinary diligence, the determination of which
properly belongs to the courts.
Same; Same; Same; Where the shipowner fails to overcome the
presumption of negligence, the doctrine of limited liability cannot be applied.
—Where the shipowner fails to overcome the presumption of negligence, the
doctrine of limited liability cannot be applied. Therefore, we agree with the
appellate court in sustaining the trial court’s ruling that petitioner is liable for
the total value of the lost cargo.
Aboitiz Shipping Corporation v. Court of Appeals
Mercantile Law; Doctrine of Limited Liability; Common Carriers; The Court
declared in the 1993 General Accident Fire and Life Assurance Corporation,
Ltd. (GAFLAC) case that claims against Aboitiz arising from the sinking of
M/V P. Aboitiz should be limited only to the extent of the value of the vessel.
—Following the doctrine of limited liability, however, the Court declared in
the 1993 GAFLAC case that claims against Aboitiz arising from the sinking
of M/V P. Aboitiz should be limited only to the extent of the value of the
vessel. Thus, the Court held that the execution of judgments in cases
already resolved with finality must be stayed pending the resolution of all the
other similar claims arising from the sinking of M/V P. Aboitiz. Considering
that the claims against Aboitiz had reached more than 100, the Court found it
necessary to collate all these claims before their payment from the insurance
proceeds of the vessel and its pending freightage. As a result, the Court
exhorted the trial courts before whom similar cases remained pending to
proceed with trial and adjudicate these claims so that the pro-rated share of
each claim could be determined after all the cases shall have been decided.
Maritime Law; Doctrine of Limited Liability; The shipowner or agent’s liability
is merely co-extensive with his interest in the vessel such that a total loss
thereof results in its extinction.—The ruling in the 1993 General Accident
Fire and Life Assurance Corporation, Ltd. (GAFLAC) case cited the real and
hypothecary doctrine in maritime law that the shipowner or agent’s liability is
merely co-extensive with his interest in the vessel such that a total loss
thereof results in its extinction. “No vessel, no liability” expresses in a
nutshell the limited liability rule. In this jurisdiction, the limited liability rule is
embodied in Articles 587, 590 and 837 under Book III of the Code of
Commerce, thus: Art. 587. The ship agent shall also be civilly liable for the
indemnities in favor of third persons which may arise from the conduct of the
captain in the care of the goods which he loaded on the vessel; but he may
exempt himself therefrom by abandoning the vessel with all her equipment
and the freight it may have earned during the voyage. Art. 590. The co-
owners of the vessel shall be civilly liable in the proportion of their interests
in the common fund for the results of the acts of the captain referred to in
Art. 587. Each co-owner may exempt himself from this liability by the
abandonment, before a notary, of the part of the vessel belonging to him.
Art. 837. The civil liability incurred by shipowners in the case prescribed in
this section, shall be understood as limited to the value of the vessel with all
its appurtenances and freightage served during the voyage.
Same; Same; Damages; When the vessel is totally lost in which case there
is no vessel to abandon, abandonment is not required—because of such
total loss the liability of the shipowner or agent for damages is extinguished.
—These articles precisely intend to limit the liability of the shipowner or
agent to the value of the vessel, its appurtenances and freightage earned in
the voyage, provided that the owner or agent abandons the vessel. When
the vessel is totally lost in which case there is no vessel to abandon,
abandonment is not required. Because of such total loss the liability of the
shipowner or agent for damages is extinguished. However, despite the total
loss of the vessel, its insurance answers for the damages for which a
shipowner or agent may be held liable.
Same; Same; The international rule is to the effect that the right of
abandonment of vessels, as a legal limitation of a shipowner’s liability does
not apply to cases where the injury or average was occasioned by the
shipowner’s own fault.—There are exceptional circumstances wherein the
ship agent could still be held answerable despite the abandonment of the
vessel, as where the loss or injury was due to the fault of the shipowner and
the captain. The international rule is to the effect that the right of
abandonment of vessels, as a legal limitation of a shipowner’s liability, does
not apply to cases where the injury or average was occasioned by the
shipowner’s own fault. Likewise, the shipowner may be held liable for injuries
to passengers notwithstanding the exclusively real and hypothecary nature
of maritime law if fault can be attributed to the shipowner.
Same; Same; Aboitiz is not entitled to the limited liability rule and is
therefore, liable for the value of the lost cargoes as so duly alleged and
proven during trial.—The finding of actual fault on the part of Aboitiz is
central to the issue of its liability to the respondents. Aboitiz’s contention, that
with the sinking of M/V P. Aboitiz, its liability to the cargo shippers and
shippers should be limited only to the insurance proceeds of the vessel
absent any finding of fault on the part of Aboitiz, is not supported by the
record. Thus, Aboitiz is not entitled to the limited liability rule and is,
therefore, liable for the value of the lost cargoes as so duly alleged and
proven during trial.
Same; Same; Where the shipowner fails to overcome the presumption of
negligence, the doctrine of limited liability cannot be applied.—On 02 May
2006, the Court rendered a decision in Aboitiz Shipping Corporation v. New
India Assurance Company, Ltd. (New India), 488 SCRA 560 (2006),
reiterating the well-settled principle that the exception to the limited liability
doctrine applies when the damage is due to the fault of the shipowner or to
the concurrent negligence of the shipowner and the captain. Where the
shipowner fails to overcome the presumption of negligence, the doctrine of
limited liability cannot be applied. In New India, the Court clarified that the
earlier pronouncement in Monarch Insurance was not an abandonment of
the doctrine of limited liability and that the circumstances therein still made
the doctrine applicable.
Same; Same; As a general rule, a ship owner’s liability is merely co-
extensive with his interest in the vessel, except where the actual fault is
attributable to the shipowner.—The instant petitions provide another
occasion for the Court to reiterate the well-settled doctrine of the real and
hypothecary nature of maritime law. As a general rule, a ship owner’s liability
is merely co-extensive with his interest in the vessel, except where actual
fault is attributable to the shipowner. Thus, as an exception to the limited
liability doctrine, a shipowner or ship agent may be held liable for damages
when the sinking of the vessel is attributable to the actual fault or negligence
of the shipowner or its failure to ensure the seaworthiness of the vessel. The
instant petitions cannot be spared from the application of the exception to
the doctrine of limited liability in view of the unanimous findings of the courts
below that both Aboitiz and the crew failed to ensure the seaworthiness of
the M/V P.
The claim for the death benefits under the POEA-SEC is the same
species as the workmen’s compensation claims under the Labor Code
—both of which belong to a different realm from that of Maritime Law.
Therefore, the limited liability rule does not apply to petitioner’s liability
under the POEA-SEC.
Phil-Nippon Kyoei, Corporation v. Rosalia T. Gudelosao
Mercantile Law; Ships and Shipping; Limited Liability Rule; Articles 587 and
590 of the Code of Commerce embody the universal principle of limited
liability in all cases wherein the shipowner or agent may be properly held
liable for the negligent or illicit acts of the captain. These articles precisely
intend to limit the liability of the shipowner or agent to the value of the vessel,
its appurtenances and freightage earned in the voyage, provided that the
owner or agent abandons the vessel.—Article 837 applies the limited liability
rule in cases of collision. Meanwhile, Articles 587 and 590 embody the
universal principle of limited liability in all cases wherein the shipowner or
agent may be properly held liable for the negligent or illicit acts of the
captain. These articles precisely intend to limit the liability of the shipowner
or agent to the value of the vessel, its appurtenances and freightage earned
in the voyage, provided that the owner or agent abandons the vessel. When
the vessel is totally lost, in which case abandonment is not required because
there is no vessel to abandon, the liability of the shipowner or agent for
damages is extinguished. Nonetheless, the limited liability rule is not
absolute and is without exceptions. It does not apply in cases: (1) where the
injury or death to a passenger is due either to the fault of the shipowner, or
to the concurring negligence of the shipowner and the captain; (2) where the
vessel is insured; and (3) in workmen’s compensation claims.
Same; Same; Same; In Abueg v. San Diego, 77 Phil. 730 (1946), the
Supreme Court (SC) ruled that the limited liability rule found in the Code of
Commerce is inapplicable in a liability created by statute to compensate
employees and laborers, or the heirs and dependents, in cases of injury
received by or inflicted upon them while engaged in the performance of their
work or employment.—In Abueg v. San Diego, 77 Phil. 730 (1946), we ruled
that the limited liability rule found in the Code of Commerce is inapplicable in
a liability created by statute to compensate employees and laborers, or the
heirs and dependents, in cases of injury received by or inflicted upon them
while engaged in the performance of their work or employment, to wit: The
real and hypothecary nature of the liability of the shipowner or agent
embodied in the provisions of the Maritime Law, Book III, Code of
Commerce, had its origin in the prevailing conditions of the maritime trade
and sea voyages during the medieval ages, attended by innumerable
hazards and perils. To offset against these adverse conditions and to
encourage shipbuilding and maritime commerce, it was deemed necessary
to confine the liability of the owner or agent arising from the operation of a
ship to the vessel, equipment, and freight, or insurance, if any, so that if the
shipowner or agent abandoned the ship, equipment, and freight, his liability
was extinguished. But the provisions of the Code of Commerce invoked by
appellant have no room in the application of the Workmen’s Compensation
Act which seeks to improve, and aims at the amelioration of, the condition of
laborers and employees. It is not the liability for the damage or loss of the
cargo or injury to, or death of, a passenger by or through the misconduct of
the captain or master of the ship; nor the liability for the loss of the ship as a
result of collision; nor the responsibility for wages of the crew, but a liability
created by a statute to compensate employees and laborers in cases of
injury received by or inflicted upon them, while engaged in the performance
of their work or employment, or the heirs and dependents of such laborers
and employees in the event of death caused by their employment.
 Such compensation has nothing to do with the provisions of the Code of
Commerce regarding maritime commerce. It is an item in the cost of
production which must be included in the budget of any well-managed
industry.
Labor Law; Seafarers; POEA-Standard Employment Contract; Akin to the
death benefits under the Labor Code, these benefits under the Philippine
Overseas Employment Administration-Standard Employment Contract
(POEA-SEC) are given when the employee dies due to a work-related cause
during the term of his contract.—Akin to the death benefits under the Labor
Code, these benefits under the POEA-SEC are given when the employee
dies due to a work-related cause during the term of his contract. The liability
of the shipowner or agent under the POEA-SEC has likewise nothing to do
with the provisions of the Code of Commerce regarding maritime commerce.
The death benefits granted under the POEA-SEC is not due to the death of a
passenger by or through the misconduct of the captain or master of the ship;
nor is it the liability for the loss of the ship as result of collision; nor the
liability for wages of the crew. It is a liability created by contract between the
seafarers and their employers, but secured through the State’s intervention
as a matter of constitutional and statutory duty to protect Filipino overseas
workers and to secure for them the best terms and conditions possible, in
order to compensate the seafarers’ heirs and dependents in the event of
death while engaged in the performance of their work or employment. The
POEA-SEC prescribes the set of standard provisions established and
implemented by the POEA containing the minimum requirements prescribed
by the government for the employment of Filipino seafarers. While it is
contractual in nature, the POEA-SEC is designed primarily for the protection
and benefit of Filipino seamen in the pursuit of their employment onboard
ocean-going vessels. As such, it is deemed incorporated in every Filipino
seafarers’ contract of employment. It is established pursuant to POEA’s
power “to secure the best terms and conditions of employment of Filipino
contract workers and ensure compliance therewith” and “to protect the well-
being of Filipino workers overseas” pursuant to Article 17 of the Labor Code
as amended by Executive Order (EO) Nos. 797 and 247.
Same; Same; Same; While the nature of death benefits under the Labor
Code and the Philippine Overseas Employment Administration-Standard
Employment Contract (POEA-SEC) are similar, the death benefits under the
POEA-SEC are intended to be separate and distinct from, and in addition to,
whatever benefits the seafarer is entitled to under Philippine laws, including
those benefits which may be claimed from the State Insurance Fund.—But
while the nature of death benefits under the Labor Code and the POEA-SEC
are similar, the death benefits under the POEA-SEC are intended to be
separate and distinct from, and in addition to, whatever benefits the seafarer
is entitled to under Philippine laws, including those benefits which may be
claimed from the State Insurance Fund. Thus, the claim for death benefits
under the POEA-SEC is the same species as the workmen’s compensation
claims under the Labor Code — both of which belong to a different realm
from that of Maritime Law. Therefore, the limited liability rule does not apply
to petitioner’s liability under the POEA-SEC.
Same; Same; Same; Solidary Liability; The basis of the solidary liability of
the principal with the local manning agent is found in the second paragraph
of Section 10 of the Migrant Workers and Overseas Filipino Act of 1995,
which, in part, provides: “[t]he liability of the principal/employer and the
recruitment/placement agency for any and all claims under this section shall
be joint and several.” This provision, is in turn, implemented by Section 1(e)
(8), Rule 2, Part II of the Philippine Overseas Employment Administration
(POEA) Rules and Regulations Governing the Recruitment and Employment
of Seafarers, which requires the undertaking of the manning agency to
“[a]ssume joint and solidary liability with the employer for all claims and
liabilities which may arise in connection with the implementation of the
employment contract [and Philippine Overseas Employment Administration-
Standard Employment Contract (POEA-SEC)].”—Petitioner is solidarily liable
with TEMMPC and TMCL for the death benefits under the POEA-SEC. The
basis of the solidary liability of the principal with the local manning agent is
found in the second paragraph of Section 10 of the Migrant Workers and
Overseas Filipino Act of 1995, which, in part, provides: “[t]he liability of the
principal/employer and the recruitment/placement agency for any and all
claims under this section shall be joint and several.” This provision, is in turn,
implemented by Section 1(e)(8), Rule 2, Part II of the POEA Rules and
Regulations Governing the Recruitment and Employment of Seafarers,
which requires the undertaking of the manning agency to “[a]ssume joint and
solidary liability with the employer for all claims and liabilities which may
arise in connection
Same; Same; Same; Same; The rule is that the release of one solidary
debtor redounds to the benefit of the others.—The rule is that the release of
one solidary debtor redounds to the benefit of the others. Considering that
petitioner is solidarily liable with TEMMPC and TMCL, we hold that the
Release and Quitclaim executed by respondents in favor of TEMMPC and
TMCL redounded to petitioner’s benefit. Accordingly, the liabilities of
petitioner under Section 20(A)(1) and (4)(c) of the POEA-SEC to
respondents are now deemed extinguished. We emphasize, however, that
this pronouncement does not foreclose the right of reimbursement of the
solidary debtors who paid (i.e., TEMMPC and TMCL) from petitioner as their
codebtor.
Even if the contract is for a bareboat or demise charter where
possession, free administration, and even navigation are temporarily
surrendered to the charterer, dominion over the vessel remains with
the shipowner. Ergo, the charterer or the sub-charterer, whose rights
cannot rise above that of the former, can never set up the Limited
Liability Rule against the very owner of the vessel.
Augustin P. Dela Torre v. The Honorable Court of Appeals
Maritime Law; Limited Liability Rule; Code of Commerce; The Limited
Liability Rule has been explained to be that of the real and hypothecary
doctrine in maritime law where the shipowner or ship agent’s liability is held
as merely co-extensive with his interest in the vessel such that a total loss
thereof results in its extinction; In this jurisdiction, the Limited Liability Rule is
provided in three articles of the Code of Commerce—Art. 587, Art. 590, and
Art. 837.—With respect to petitioners’ position that the Limited Liability Rule
under the Code of Commerce should be applied to them, the argument is
misplaced. The said rule has been explained to be that of the real and
hypothecary doctrine in maritime law where the shipowner or ship agent’s
liability is held as merely co-extensive with his interest in the vessel such that
a total loss thereof results in its extinction. In this jurisdiction, this rule is
provided in three articles of the Code of Commerce. These are: Art. 587. The
ship agent shall also be civilly liable for the indemnities in favor of third
persons which may arise from the conduct of the captain in the care of the
goods which he loaded on the vessel; but he may exempt himself therefrom
by abandoning the vessel with all her equipment and the freight it may have
earned during the voyage.---Art. 590. The co-owners of the vessel shall be
civilly liable in the proportion of their interests in the common fund for the
results of the acts of the captain referred to in Art. 587. Each co-owner may
exempt himself from this liability by the abandonment, before a notary, of the
part of the vessel belonging to him.---Art. 837. The civil liability incurred by
shipowners in the case prescribed in this section, shall be understood as
limited to the value of the vessel with all its appurtenances and freightage
served during the voyage.
Same; Same; Same; The only person who could avail of the Limited Liability
Rule is the shipowner—he is the very person whom the Rule has been
conceived to protect—and charterers cannot invoke this as a defense.—
Article 837 specifically applies to cases involving collision which is a
necessary consequence of the right to abandon the vessel given to the
shipowner or ship agent under the first provision—Article 587. Similarly,
Article 590 is a reiteration of Article 587, only this time the situation is that
the vessel is co-owned by several persons. Obviously, the forerunner of the
Limited Liability Rule under the Code of Commerce is Article 587. Now, the
latter is quite clear on which indemnities may be confined or restricted to the
value of the vessel pursuant to the said Rule, and these are the
—“indemnities in favor of third persons which may arise from the conduct of
the captain in the care of the goods which he loaded on the vessel.” Thus,
what is contemplated is the liability to third persons who may have dealt with
the shipowner, the agent or even the charterer in case of demise or bareboat
charter. The only person who could avail of this is the shipowner,
Concepcion. He is the very person whom the Limited Liability Rule has been
conceived to protect. The petitioners cannot invoke this as a defense.
Same; Same; Same; Since the shipowner is the one who is supposed to be
supported and encouraged to pursue maritime commerce, it would be
absurd to apply the Limited Liability Rule against him who, in the first place,
should be the one benefitting from it.—In the case of Monarch Insurance
Co., Inc. v. CA, 333 SCRA 71 (2000), this Court, this time through Justice
Sabino R. De Leon, Jr., again explained: ‘No vessel, no liability,’ expresses
in a nutshell the limited liability rule. The shipowner’s or agent’s liability is
merely coextensive with his interest in the vessel such that a total loss
thereof results in its extinction. The total destruction of the vessel
extinguishes maritime liens because there is no longer any res to which it
can attach. This doctrine is based on the real and hypothecary nature of
maritime law which has its origin in the prevailing conditions of the maritime
trade and sea voyages during the medieval ages, attended by innumerable
hazards and perils. To offset against these adverse conditions and to
encourage shipbuilding and maritime commerce, it was deemed necessary
to confine the liability of the owner or agent arising from the operation of a
ship to the vessel, equipment, and freight, or insurance, if any. In view of the
foregoing, Concepcion as the real shipowner is the one who is supposed to
be supported and encouraged to pursue maritime commerce. Thus, it would
be absurd to apply the Limited Liability Rule against him who, in the first
place, should be the one benefitting from the said rule.
Same; Same; Same; The charterer does not completely and absolutely step
into the shoes of the shipowner or even the ship agent because there
remains conflicting rights between the former and the real shipowner as
derived from the charter agreement; The charterer or the sub-charterer,
whose rights cannot rise above that of the shipowner, can never set up the
Limited Liability Rule against the very owner of the vessel.—In Yueng
Sheng, it was further stressed that the charterer does not completely and
absolutely step into the shoes of the shipowner or even the ship agent
because there remains conflicting rights between the former and the real
shipowner as derived from their charter agreement. The Court again quotes
Chief Justice Arellano: Their (the charterer’s) possession was, therefore, the
uncertain title of lease, not a possession of the owner, such as is that of the
agent, who is fully subrogated to the place of the owner in regard to the
dominion, possession, free administration, and navigation of the vessel.
Therefore, even if the contract is for a bareboat or demise charter where
possession, free administration and even navigation are temporarily
surrendered to the charterer, dominion over the vessel remains with the
shipowner. Ergo, the charterer or the sub-charterer, whose rights cannot rise
above that of the former, can never set up the Limited Liability Rule against
the very owner of the vessel. Borrowing the words of Chief Justice Artemio
V. Panganiban, “Indeed, where the reason for the rule ceases, the rule itself
does not apply.”
Same; Same; Same; None of the provisions found in the Code of Commerce
deals with the specific rights and obligations between the real shipowner and
the charterer obtaining in the instant case—necessarily, the Court looks to
the New Civil Code to supply the deficiency.—In the present case, the
charterer and the sub-charterer through their respective contracts of
agreement/charter parties, obtained the use and service of the entire LCT-
Josephine. The vessel was likewise manned by the charterer and later by
the sub-charterer’s people. With the complete and exclusive relinquishment
of possession, command and navigation of the vessel, the charterer and
later the sub-charterer became the vessel’s owner pro hac vice. Now, and in
the absence of any showing that the vessel or any part thereof was
commercially offered for use to the public, the above agreements/charter
parties are that of a private carriage where the rights of the contracting
parties are primarily defined and governed by the stipulations in their
contract. Although certain statutory rights and obligations of charter parties
are found in the Code of Commerce, these provisions as correctly pointed
out by the RTC, are not applicable in the present case. Indeed, none of the
provisions found in the Code of Commerce deals with the specific rights and
obligations between the real shipowner and the charterer obtaining in this
case. Necessarily, the Court looks to the New Civil Code to supply the
deficiency. Thus, the RTC and the CA were both correct in applying the
statutory provisions of the New Civil Code in order to define the respective
rights and obligations of the opposing parties.
Same; Same; Parties; Due Process; Since the purpose of formally
impleading a party is to assure him a day in court, once the protective mantle
of due process of law has in face been accorded a litigant, whatever the
imperfection in form, the real litigant may be held liable as a party.—Agustin,
on the other hand, who was the sub-charterer or sub-lessee of LCT-
Josephine, is liable under Article 1651 of the New Civil Code. Although he
was never privy to the contract between PTSC and Concepcion, he
remained bound to preserve the chartered vessel for the latter. Despite his
non-inclusion in the complaint of Concepcion, it was deemed amended so as
to include him because, despite or in the absence of that formality of
amending the complaint to include him, he still had his day in court as he
was in fact impleaded as a third-party defendant by his own son, Roland—
the very same person who represented him in the Contract of Agreement
with Larrazabal. (S)ince the purpose of formally impleading a party is to
assure him a day in court, once the protective mantle of due process of law
has in fact been accorded a litigant, whatever the imperfection in form, the
real litigant may be held liable as a party.
ART. 588. Neither the shipowner nor the ship agent shall be liable for the
obligation contracted by the captain if the latter exceed his powers and
privileges pertaining to him by reason of his position or conferred upon
him by the former.
However, if the amounts claimed were used for the benefit of the vessel,
the owner or agent shall be liable.
ART. 589. If two or more persons should be co-owners of a merchant
vessel, a partnership shall be presumed as established by the co-owners.
This partnership shall be governed by the resolutions of the majority of
the co-owners.
A majority shall be the relative majority of the voting coowners.
If there should be only two co-owners, in case of disagreement the vote of
the co-owner having the largest interest shall be decisive. If the interests
are equal, it shall be decided by lot.
The co-owner having the smallest share in the vessel shall have one vote;
and the other co-owners proportionately shall have as many votes as they
have parts equal to the smallest one.
The vessel cannot be detained, attached, or levied upon execution in her
entirety for the private debts of a co-owner, but the proceedings limited to
the interest, which the debtor may have in the vessel, may be made,
without interfering with her navigation.
ART. 590. The co-owners of the vessel shall be civilly liable in the
proportion of their contribution to the common fund for the results of the
acts of the captain, referred to in Article 587.
Each co-owner may exempt himself from this liability by the
abandonment, before a notary, of that part of the vessel belonging to him.
ART. 591. All the co-owners shall be liable, in proportion to their
respective ownership, for the expenses of the repairs of the vessel and for
other expenses, which are incurred by virtue of the resolution of the
majority.
They shall likewise be liable in the same proportion for the expenses of
maintenance, equipment, and provisioning of the vessel, necessary for
navigation.
ART. 592. The resolutions of the majority with regard to the repair,
equipment, and provisioning of the vessel in the port of departure shall
bind the minority unless the co-owners in the minority renounce their
participation therein, which must be acquired by the other co-owners after
a judicial appraisement of the value of the portion or portions assigned.
ART. 593. The owners of a vessel shall have preference in her charter
over other persons, offering equal conditions and price. If two or more of
the former should claim said right, the one having greater interest shall be
preferred, and should they have an equal interest it shall be decided by
lot.
ART. 594. The co-owners shall elect the manager who is to represent
them in the capacity of ship agent.
The appointment of director or ship agent shall be revocable at the will of
the co-owners.
ART. 595. The ship agent, whether he is at the same time the owner of
the vessel, or a manager for an owner or for an association of co-owners,
must have the capacity to engage in commerce and must be recorded in
the merchant’s registry of the province.
The ship agent shall represent the ownership of the vessel, and may in
his own name and in such capacity take judicial and extrajudicial steps in
matters relating to commerce.
ART. 596. The ship agent may occupy the duties of captain of the vessel,
subject in every case, to the provisions contained in Article 609.
If two or more co-owners apply for the position of captain, the
disagreement shall be decided by a vote of the co-owners, and if the vote
should result in a tie, the position shall be given to the coowner having the
larger interest in the vessel.
If the interest of the applicants should be the same, and there should be a
tie, the matter shall be decided by lot.
ART. 597. The ship agent shall select and come to an agreement with the
captain, and shall contract in the name of the owners who shall be bound
in all that refers to repairs, details of equipment, armament, provisions,
fuel, and freight of the vessel, and, in general, in all that pertains to the
requirements of navigation.
ART. 598. The ship agent may not order a new voyage, or make
contracts for a new charter, or insure the vessel, without the authority of
her owner or by virtue of a resolution of the majority of the co-owners,
unless these privileges were granted to him in the certificate of his
appointment.
If he should insure the vessel without authority therefore, he shall
subsidiary be liable for the solvency of the insurer.
ART. 599. The managing agent of an association shall render to his co-
owners an account of the results of each voyage of the vessel, without
prejudice to always having the books and correspondence relating to the
vessel and to her voyage at their disposal.
ART. 600. After the account of the managing agent has been approved
by a relative majority, the co-owners shall pay the expenses in proportion
to their interest, without prejudice to the civil or criminal actions, which the
minority may deem, fit to institute afterwards.
In order to enforce the payment, the managing agents shall be entitled to
an executory action, which shall be instituted by virtue of a resolution of
the majority, and without further proceedings than the acknowledgment of
the signatures of the persons who voted the resolution.
ART. 601. Should there be any profits, the co-owners may demand of the
managing agent the amount due them, by means of an executory action
without further requisite than the acknowledgment of the signatures in the
instrument approving the account.
ART. 602. The ship agent shall indemnify the captain for all the expenses
he may have incurred from his own funds or from those of other persons
for the benefit of the vessel.
ART. 603. Before the vessel goes out to sea, the ship agent may, at his
discretion, discharge the captain and members of the crew whose
contract did not state a fixed period or voyage, paying them the salaries
earned according to their contracts, and without any indemnity
whatsoever, unless there is an expressed and specific agreement in
respect thereto.
ART. 604. If the captain or any other member of the crew should be
discharged during the voyage, they shall continue to receive their salary
until their return to the port where the contract was made, unless there
should be just motive for the discharge, all in accordance with Article 636
et. seq. of this Code.
ART. 605. If the contracts of the captain and members of the crew with
the agent should be for a fixed period or voyage, they may not be
discharged until after the fulfilment of their contracts, except for reason of
insubordination in serious matters, robbery, theft, habitual drunkenness or
damage caused to the vessel or to her cargo by malice, or manifest or
proven negligence.
ART. 606. If the captain should be a co-owner of the vessel, he may not
be discharged without the ship agent returning to him the amount of his
interest therein, which, in the absence of an agreement between the
parties, shall be appraised by experts appointed in the manner
established in the law of civil procedure.
ART. 607. If the captain who is a co-owner should have obtained the
command of the vessel by virtue of special agreement contained in the
articles of co-partnership, he cannot be deprived of his office except for
the causes mentioned in Article 605.

ART. 608. In case of the voluntary sale of the vessel, all contracts
between the ship agent and captain shall terminate, the right to proper
indemnity being reserved in favor of the captain, according to the
agreements made with the ship agent.
The vessel sold shall remain subject to the security of the payment of said
indemnity if, after the action against the seller has been instituted, the
latter should be insolvent
CAPTAINS AND MASTERS OF THE VESSEL
ART. 609. Captains and masters of vessels must be Filipinos having legal
capacity to obligate themselves in accordance with this Code, and must
prove that they have the skill, capacity, and qualifications required to
command and direct the vessel, as established by marine or navigation
laws, ordinances, or regulations, and must not be disqualified according
to the same for the discharge of the duties of that position.
If the owner of a vessel desires to be the captain thereof and does not
have the legal qualifications therefore, he shall limit himself to the
financial administration of the vessel, and shall entrust her navigation to
the person possessing the qualifications required by said ordinances and
regulations.
Master of a ship
 is the commander of a merchant vessel,
 who has the chief charge of her government and navigation and the
command of the crew, as well as the general care and control of the
vessel and cargo,
 as the representative and confidential agent of the owner.
 He is commonly called the “captain.”
 Under the Code of Commerce, captain and master of the vessel have
the same meaning; both being the commander and technical director
of the vessel.
 SC: captain of a vessel is a confidential and managerial employee.
 A master or captain, for purposes of maritime commerce, is one who
has command of a vessel.
 A captain commonly performs three distinct roles:
o (1) he is a general agent of the shipowner;
o (2) he is also commander and technical director of the
vessel;
o (3) he is a representative of the country under whose flag he
navigates.
 the most important is the role performed by the captain as commander
of the vessel; for such role (which, to our mind, is analogous to that of
“Chief Executive Officer” [CEO] of a present-day corporate enterprise)
has to do with the operation and preservation of the vessel during its
voyage and the protection of the passengers (if any) and crew and
cargo.
 In his role as general agent of the shipowner, the captain has
authority to sign bills of lading, carry goods aboard and deal with the
freight earned, agree upon rates and decide whether to take cargo.
 The ship captain, as agent of the shipowner, has legal authority to
enter into contracts with respect to the vessel and the trading of the
vessel, subject to applicable limitations established by statute,
contract or instructions and regulations of the shipowner.
 To the captain is committed the governance, care and management of
the vessel.
 Clearly, the captain is vested with both management and fiduciary
functions.
ART. 610. The following powers are inherent in the position of captain or
master of a vessel.
1. To appoint or make contracts with the crew in the absence
of the ship agent, and to propose said crew, should the said agent be
present; but the ship agent shall not be permitted to employ any member
against the captain’s express refusal.
2. To command the crew and direct the vessel to the port of its
destination, in accordance with the instructions he may have received
from the ship agent.
3. To impose, in accordance with the contracts and the laws and
regulations of the merchant marine, on board the vessel, correctional
punishment upon those who do not comply with his orders or who
conduct themselves against discipline, holding a preliminary investigation
on the crimes committed on board the vessel on the high seas, which he
shall turn over to the authorities who are to take cognizance thereof, at
the first port touched.
4. To make contracts for the charter of the vessel in the absence of her
ship agent or consignee, acting in accordance with the instructions
received and protecting with utmost care the interest of the owner.
5. To adopt all proper measures in order to keep the vessel well
provisioned and equipped, purchasing all that may be necessary for the
purpose, provided there is no time request instructions from the ship
agent.
6. To make disposition, in similar urgent cases while on a voyage, for the
repairs of the hull and engines of the vessel and of her rigging and
equipment which are absolutely necessary so that she may be able to
continue and conclude her voyage; but if she should arrive at a point
where there is a consignee of the vessel, he shall act in concurrence with
the latter.
ART. 611. In order to comply with the obligations mentioned in the
preceding article, the captain, when he has no funds and does not expect
to receive any from the ship agent, shall obtain the same in the
successive order stated below:
1. By requesting said funds from the consignees of the vessel or
correspondents of the ship agent.
2. By applying to the consignees of the cargo or to the persons interested
therein.
3. By drawing on the ship agent.
4. By borrowing the amount required by means of a loan on bottomry.
5. By selling a sufficient quantity of the cargo to cover the amount
absolutely necessary to repair the vessel and equip her to pursue the
voyage.
In the two latter cases he must apply to the judicial authority
of the port if in the Philippines, and to the Filipino consul if in a foreign
country; and where there should be none, to the local authority,
proceeding in accordance with the provisions of Article 583, and with
provisions of the law of civil procedure.
 A ship’s captain must be accorded a reasonable measure of
discretionary authority to decide what the safety of the ship and of its
crew and cargo specifically requires on a stipulated ocean voyage.
 The captain is held responsible, and properly so, for such safety. He is
right there on the vessel, in command of it and (it must be presumed)
knowledgeable as to the specific requirements of seaworthiness and
the particular risks and perils of the voyage he is to embark upon.
 The applicable principle is that the captain has control of all
departments of service in the vessel, and reasonable discretion as to
its navigation.
 It is the right and duty of the captain, in the exercise of sound
discretion and in good faith, to do all things with respect to the vessel
and its equipment and conduct of the voyage which are reasonably
necessary for the protection and preservation of the interests under
his charge, whether those be of the shipowners, charterers, cargo
owners or of underwriters.
 It is a basic principle of admiralty law that in navigating a
merchantman, the master must be left free to exercise his own best
judgment.
 The requirements of safe navigation compel us to reject any
suggestion that the judgment and discretion of the captain of a vessel
may be confined within a straitjacket, even in this age of electronic
communications.
 Indeed, if the ship captain is convinced, as a reasonably prudent and
competent mariner acting in good faith that the shipowner’s or ship
agent’s instructions (insisted upon by radio or telefax from their offices
thousands of miles away) will result, in the very specific circumstances
facing him, in imposing unacceptable risks of loss or serious danger to
ship or crew, he cannot casually seek absolution from his
responsibility, if a marine casualty occurs, in such instructions.
ART. 612. The following duties are inherent in the office of captain:
1. To have on board, before starting on a voyage, a detailed inventory of
the hull, engines, rigging, tackle, stores and other equipment of the
vessel; the navigation certificate; the roll of the persons who make up the
crew of the vessel, and the contracts entered into with the crew; the list of
passengers; the health certificate; the certificate of the registry proving the
ownership of the vessel, and all the obligations which encumber the same
up to that date; the charter parties or authenticated copies thereof; the
invoices or manifests of the cargo, and the instrument of the visit or
inspection of the expert, should it have been made at the port of
departure.
2. To have a copy of this Code on board.
3. To have three folioed and stamped books, placing at the beginning of
each one a note of the number of folios it contains, signed by the marine
official, and, in his absence, by the competent authority.
In the first book which shall be called “logbook,” he shall enter every day
the condition of the atmosphere, the prevailing winds, the course taken,
the rigging carried, the horsepower of the engines, the distance covered,
the maneuvers executed, and other incidents of navigation; he shall also
enter the damage suffered by the vessel in her hull, engines, rigging, and
tackle, no matter what is its cause, as well as the imperfections and
averages of the cargo, and the effects and consequences of the jettison,
should there be any; and in cases of grave resolutions which required the
advice or a meeting of the officers of the vessel or even of the passengers
and crew, he shall record the decisions adopted. For the informations
indicated he shall make use of the binnacle book, and the steam or
engine book kept by the engineer.
4. To make, before receiving the cargo, with the officers of the crew and
two experts, if required by the shippers and passengers, an examination
of the vessel, in order to ascertain whether she is watertight, with the
rigging and engines in good condition, and with equipment required for
good navigation, preserving a certificate of the memorandum of this
inspection, signed by all the persons who may have taken part therein,
under their responsibility.
The experts shall be appointed, one by the captain of the vessel and the
other one by those who request the examination, and in case of
disagreement a third shall be appointed by the marine authority of the
port.
5. To remain constantly on board the vessel with the crew while receiving
the cargo on board, and watch carefully the stowage thereof; not to
consent to the loading of any merchandise or goods of a dangerous
character, such as inflammable or explosive substances, without the
precautions which are recommended for their packing, handling, and
isolation; not to permit any cargo to be carried on deck which, by reason
of its arrangement, volume, or weight, makes the work of the sailors
difficult, and which might endanger the safety of the vessel; and in case
the nature of the merchandise, the special character of the shipment and
principally the favorable season when it takes place, would allow the
merchandise to be carried on deck, he must hear the opinion of the
officers of the vessel, and have the consent of the shippers and of the
ship agent.
6. To demand a pilot at the expense of the vessel whenever required by
navigation, and principally when a port, canal, or river, or a roadstead or
anchoring place is to be entered with which neither he, nor the officers
and the crew are acquainted.
7. To be on deck at the time of sighting land and to take command on
entering and leaving the ports, canals, roadsteads, and rivers, unless
there is a pilot on board discharging his duties. He shall not spend his
night away from the vessel except for serious cause or by reason of
official business.
8. To present himself, when making a port in distress, to the maritime
authority if in the Philippines and to the Filipino consul if in a foreign
country, before twenty-four hours have elapsed, and make a statement of
the name, registry, and port of departure of the vessel, of her cargo, and
cause of arrival, which declaration shall be vised by the authority or by the
consul if after examining the same it is found to be acceptable, giving the
captain the proper certificate in order to show his arrival under stress and
the causes therefore. In the absence of marine officials or of the consul,
the declaration must be made before the local authority.
9. To take the necessary steps before the competent authority in order to
enter in the certificate of the vessel in the registry of vessels, the
obligations which he may contract in accordance with Art. 583.
10. To place under good care and custody all the papers and belongings
of any member of the crew who might die on the vessel, making a
detailed inventory in the presence of passengers as witnesses, and, in
their absence, of members of the crew.
11. To conduct himself according to the rules and precepts contained in
the instructions of the ship agent, being liable for all that he may do in
violation thereof.
12. To give account to the ship agent, from the port where the vessel
arrives, of the cause of his arrival, taking advantage of the semaphore,
telegraph, mail etc., as the case may be; notify the said ship agent of the
cargo he may have received, stating the names and domiciles of the
shippers, freight earned, and amounts borrowed on bottomry loan; advise
him of his departure, and give him any information and data which may be
of interest to him.
13. To observe the rules on the situation of lights and maneuvers to
prevent collisions.
14. To remain on board, in case the vessel is in danger, until the last hope
to save her is lost, and before abandoning her, to hear the officers of the
crew, abiding by the decision of the majority; and if he should have to take
a boat he shall take with him, before anything else, the books and papers
and then the articles of most value, being obliged to prove, in case of the
loss of the books and papers, that he did all he could to save them.
15. In case of shipwreck, to make the proper protest in due form at the
first port reached before the competent authority or Filipino consul within
twenty-four hours, specifying therein all the incidents of the wreck in
accordance with subdivision 8 of this article.
16. To comply with the obligations imposed by the laws and regulations of
navigation, customs, health, and others.
Failure of Ship Captain to ascertain beforehand direction of reported
storm and weather conditions along his route constitutes negligent
lack of foresight
Alejandro Arada v. Court of Appeals and San Miguel Corporation
Common Carriers; Words & Phrases; “Common carriers” defined.—Common
carriers are persons, corporations, firms or associations engaged in the
business of carrying or transporting passengers or goods or both, by land,
water or air, for compensation offering their services to the public (Art. 1732
of the New Civil Code).
Same; Common carriers required to exercise extraordinary diligence.—A
common carrier, both from the nature of its business and for insistent
reasons of public policy is burdened by law with the duty of exercising
extraordinary diligence not only in ensuring the safety of passengers, but in
caring for the goods transported by it. The loss or destruction or deterioration
of goods turned over to the common carrier for the conveyance to a
designated destination raises instantly a presumption of fault or negligence
on the part of the carrier, save only where such loss, destruction or damage
arises from extreme circumstances such as a natural disaster or calamity x x
x.
Same; Natural disaster must be the proximate and only cause of loss to
exempt carrier from liability.—In order that the common carrier may be
exempted from responsibility, the natural disaster must have been the
proximate and only cause of the loss. However, the common carrier must
exercise due diligence to prevent or minimize the loss before, during and
after the occurrence of flood, storm or other natural disaster in order that the
common carrier may be exempted from liability for the destruction or
deterioration of the goods (Article 1739, New Civil Code).
Same; Failure of ship captain to ascertain beforehand direction of reported
storm and weather conditions along his route constitutes negligent lack of
foresight.—Respondent court’s conclusion as to the negligence of petitioner
is supported by evidence. It will be noted that Vivencio Babao knew of the
impending typhoon on March 24, 1982 when the Philippine Coast Guard
denied M/L Maya the issuance of a clearance to sail. Less than 24 hours
elapsed since the time of the denial of said clearance and the time a
clearance to sail was finally issued on March 25, 1982. Records will show
that Babao did not ascertain where the typhoon was headed by the use of
his vessel’s barometer and radio (Rollo, p. 142). Neither did the captain of
the vessel monitor and record the weather conditions everyday as required
by Art. 612 of the Code of Commerce (Rollo, pp. 142-143). Had he done so
while navigating for 31 hours, he could have anticipated the strong winds
and big waves and taken shelter (Rollo, pp. 36; 145).
Same; Vessel owner negligent for hiring unlicensed crew even if they have
special coast guard permits.—Furthermore, the records show that the crew
of M/L Maya did not have the required qualifications provided for in P.D. No.
97 or the Philippine Merchant Marine Officers Law, all of whom were
unlicensed. While it is true that they were given special permit to man the
vessel, such permit was issued at the risk and responsibility of the owner.
Same; Maritime Law; Exoneration of vessel by Special Board of Marine
Inquiry affects only its administrative liability.—In rejecting petitioner’s claim,
respondent court was correct in ruling that “such exoneration was but with
respect to the administrative liability of the “owner/operator, officers and crew
of the ill-fated” vessel. It could not have meant exoneration of appellee from
liability as a common carrier for his failure to observe extraordinary diligence
in the vigilance over the goods it was transporting and for the negligent acts
or omissions of his employees. Such is the function of the Court, not the
Special Board of Marine Inquiry.”
ART. 613. A captain who navigates for freight in common or on shares,
may not make any separate transaction for his own account, and should
he do so the profits shall belong to the other persons interested, and the
losses shall be borne by him alone.
ART. 614. A captain who, having agreed to make a voyage, fails to fulfill
his undertaking, without being prevented by fortuitous event or force
majeure, shall indemnify all the losses, which his failure may cause,
without prejudice to criminal penalties, which may be proper.
ART. 615. Without the consent of the ship agent, the captain may not
have himself substituted by another person; and should he do so, besides
being liable for all the acts of the substitute and bound to pay the
indemnities mentioned in the foregoing article, the captain as well as the
substitute may be discharged by the ship agent.
ART. 616. If the provisions and fuel of the vessel are consumed before
arriving at the port of destination, the captain shall order with the consent
of the officers of the same, to make the nearest port to get a supply of
either; but if there are persons on board who have provisions of their own,
he may compel them to turn over said provisions for the common
consumption of all persons on board, paying the price thereof at the same
time, or, at the latest, at the first port where the vessel may arrive.
ART. 617. The captain cannot contract loans on respondentia secured by
the cargo, and should he do so, the contract shall be void.
Neither can he borrow money on bottomry for his own transactions,
except on the portion of the vessel he owns, provided, no money has
been previously borrowed on the whole vessel, nor exits any other kind of
lien or obligation chargeable against her. When he is permitted to do so,
he must necessarily state what interest he has in the vessel.
In case of violation of this article, the principal, interest, and costs shall be
charged to the private account of the captain, and the agent shall further
have the right to discharge him.
ART. 618. 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. For all the damage suffered by the vessel and her cargo by
reason of want of skill and negligence on his part. If a misdemeanor or
crime has been committed, they shall be liable in accordance with the
Penal Code.
2. For all thefts and robberies committed by the crew, reserving his right
of action against the guilty parties.
3. For the losses, fines and confiscations imposed on account of violation
of laws and regulations of customs, police, health, and navigation.
4. For the damage caused by mutinies on board the vessel, or by reason
of faults committed by the crew in the service and defense of the same, if
he does not prove that he opportunely made full use of his authority to
prevent or avoid them.
5. For those arising by reason of a misuse of powers and nonfulfillment of
duties corresponding to him in accordance with Articles 610 and 612.
6. For those arising by reason of his going out of his course or taking a
course which, in the opinion of the officers of the vessel at a meeting
attended by the shippers and supercargoes who may be on board, he
should not have taken without sufficient cause.
No exception whatsoever shall exempt him from this liability.
7. For those arising by reason of his voluntarily entering a port other than
his destination, outside of the cases of without formalities referred to in
Article 612.
8. For those arising by reason for the non-observance of the provisions
contained in the regulations for the situation of lights and maneuvers for
the purpose of preventing collisions.
ART. 619. The captain shall be liable for the cargo from the time it is
turned over to him at the dock or afloat alongside the vessel at the port of
loading, until he delivers it on the shore or on the discharging wharf at the
port of unloading, unless otherwise expressly agreed upon.
ART. 620. The captain shall not be liable for the damage caused to the
vessel or to the cargo by reason of force majeure; but he shall always be
so for those arising through his own fault, no agreement to the contrary
being valid.
Neither shall he be personally liable for the obligation he may have
contracted for the repair, equipment, and provisioning of the vessel, which
shall be incurred by the ship agent, unless the former has expressly
bound himself personally or signed a bill of exchange or promissory note
in his name.
ART. 621. A captain who borrows money on the hull, engine, rigging or
tackle of the vessel, or who pledges or sells merchandise or provisions
outside of the cases and without formalities prescribed in this Code, shall
be liable for the principal, interest, and costs, and shall indemnify for the
damages he may cause.
He, who commits fraud in his accounts, shall reimburse the amount
defrauded, and shall be subject to the provisions of the Revised Penal
Code.
ART. 622. If, when on a voyage, the captain should receive news of the
appearance of corsairs or men of war against his flag, he shall be obliged
to make the nearest neutral port, inform his ship agent or shippers, and
await an occasion to sail under convoy or until the danger is over, or to
final orders from the ship agent or shippers.
ART. 623. If he should be attacked by a corsair and after having tried to
avoid the encounter and having resisted the delivery of the effects of the
vessel or of her cargo, they should be forcibly taken away from him, or he
should be obliged to deliver them, he shall make an entry of that fact in
his freight book and shall prove it before the competent authority at the
first port he touches.
After the force majeure has been proven, he shall be exempted from
liability.
ART. 624. A captain whose vessel has gone through a hurricane or who
believes that the cargo has suffered damage or averages, shall make a
protest thereon before the competent authority at the first port he touches
within the twenty-four hours following his arrival, and shall ratify it within
the same period when he arrives at the place of his destination,
proceeding immediately with the proof of the facts, without opening the
hatches not until after this has been done.
The captain shall proceed in the same manner if, the vend having been
wrecked, he is saved alone or with part of his cre*, in which case he shall
appear before the nearest authority, and make a sworn statement of the
facts.
The authority or the consul abroad shall verify the said facts, 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, he shall make a statement of what may be the result of the
proceedings in the logbook and in that of the sailing mate, and shall
deliver the original records of the proceedings to the captain, stamped
and folioed, with a memorandum of the folios, which he must rubricate, for
their presentation to the judge or court of the port of destination.
The statement of the captain shall be believed if it is in accordance with
those of the crew and passengers; if they disagree, the latter shall be
accepted, always saving proof to the contrary.
ART. 625. The captain, under his personal responsibility, as soon as he
should have arrived at the port of his destination, obtained the necessary
permission from the offices of health and customs, and complied with the
other formalities required by the regulations of the administration, shall
make the delivery of the cargo without any defalcation to the consignees,
and, in proper case, the vessel, rigging, and freights to the ship agent.
OFFICERS AND CREW OF THE VESSELS
If, by reason of the absence of the consignee or non-appearance of the
legal holder of the invoices, the captain should not know to whom the
cargo could be legally delivered, he shall place it at the disposal of the
proper judge, or court, or authority, in order that he may determine what is
proper with regard to its deposit, preservation, and custody.
 ART. 626. In order to be a sailing mate it shall be necessary:
1. To possess the qualifications required by the marine or navigation laws
or regulations.
2. Not to be disqualified in accordance therewith for the discharge of the
position.
ART. 627. The sailing mate, as the second chief of the vessel and unless
the ship agent does not oi-der otherwise, shall take the place of the
captain in case of absence sickness or death, and shall then assume all
his powers, obligations and liabilities.
 Chief Mate, also called Chief Officer or Sailing Mate, as "the second
chief of the vessel, and unless the agent orders otherwise, shall take
the place of the captain in cases of absence, sickness, or death, and
shall then assume all his powers, duties, and responsibilities
 " A Chief Officer, therefore, is second in command, next only to the
captain of the vessel. Moreover, the Standard of Training,
Certification, and Watchkeeping for Seafarers 1978 (STCW '78), to
which the Philippines is a signatory, defines a Chief Mate as "the deck
officer next in rank to the master and upon whom the command of the
ship will fall in the event of incapacity of the master."
 Chief Mate is a managerial employee because the said officer
performed the functions of an executive officer next in command to the
captain; that in the performance of such functions, he is vested with
powers or prerogatives to lay down and execute management
policies.
 The exercise of discretion and judgment in directing a ship's course is
as much managerial in nature as decisions arrived at in the confines
of the more conventional boardroom or executive office; Important
functions pertaining to the navigation of the vessel like assessing risks
and evaluating the vessel's situation are managerial in nature. Thus,
respondent, as Chief Ofificer, is a managerial employee; hence,
petitioners need to show by substantial evidence the basis for their
claim that respondent has breached their trust and confidence.
The Master shall retain overall command of the vessel even on pilotage
grounds whereby he can countermand or overrule the order or
command of the Harbor Pilot on board
Lorenzo Shipping Corporation v. National Power Corporation
Mercantile Law; Ships and Shipping; The Supreme Court’s (SC’s) citation in
Yu Con v. Ipil, 41 Phil. 770 (1916), of General Review of Legislation and
Jurisprudence explains that “Master” and “Captain” are synonymous terms.
—A Master’s designation as the commander of a vessel is long-settled. This
court’s citation in Yu Con v. Ipil, 41 Phil. 770 (1916), of General Review of
Legislation and Jurisprudence explains that “Master” and “Captain” are
synonymous terms: “The name of captain or master is given, according to
the kind of vessel, to the person in charge of it. “The first denomination is
applied to those who govern vessels that navigate the high seas or ships of
large dimensions and importance, although they be engaged in the
coastwise trade. “Masters are those who command smaller ships engaged
exclusively in the coastwise trade. “For the purposes of maritime commerce,
the words ‘captain’ and ‘master’ have the same meaning; both being the
chiefs or commanders of ships.”
Same; Same; Pilotage Services; There are recognized instances when
control of a vessel is yielded to a pilot.—There are recognized instances
when control of a vessel is yielded to a pilot. Section 8 of Philippine Ports
Authority (PPA) Administrative Order No. 03-85, otherwise known as the
Rules and Regulations Governing Pilotage Services, the Conduct of Pilots
and Pilotage Fees in Philippine Ports, enumerates instances when vessels
are subjected to compulsory pilotage: Sec. 8. Compulsory Pilotage Service.
—For entering a harbor and anchoring thereat, or passing through rivers or
straits within a pilotage district, as well as docking and undocking at any
pier/wharf, or shifting from one berth or another, every vessel engaged in
coastwise and foreign trade shall be under compulsory pilotage. However, in
the Ports of Manila and Cebu, and in such other ports as may be allowed by
this Authority, Ship Captains may pilot their vessels engaged in coastwise
trade provided they meet/comply with the following minimum
qualifications/requirements:
a) Must be properly licensed as a Harbor Pilot by the Philippine Coast Guard
for Manila, Cebu and other authorized ports; b) Must have been a Master of
an interisland vessel for at least three (3) years prior to his application with
the PPA; c) Must be certified by a government physician as physically and
mentally fit. Vessels maneuvered by a Special Harbor Pilot shall be exempt
from the payment of all pilotage fees.
Same; Same; Same; Harbor Pilots; Section 32(f) of Philippine Ports
Authority (PPA) Administrative Order No. 03-85 specifies the foremost
responsibility of a Harbor Pilot, that is, the direction of the vessel being
piloted.—Section 32(f) of PPA Administrative Order No. 03-85 specifies the
foremost responsibility of a Harbor Pilot, that is, the direction of the vessel
being piloted. In addition, Section 32(f) spells out the duration within which
the Harbor Pilot is to fulfill this responsibility. It likewise provides that the
Master’s failure to carry out the Harbor Pilot’s orders is a ground for
absolving the Harbor Pilot of liability: Sec. 32. Duties and Responsibilities of
the Pilots or Pilots’ Association.—The duties and responsibilities of the
Harbor Pilot shall be as follows: . . . . f) A pilot shall be held responsible for
the direction of a vessel from the time he assumes his work as a pilot thereof
until he leaves it anchored or berthed safely; Provided, however, that his
responsibility shall cease at the moment the Master neglects or refuses to
carry out his order.
Same; It is settled that Harbor Pilots are liable only to the extent that they
can perform their function through the officers and crew of the piloted vessel.
—Accordingly, it is settled that Harbor Pilots are liable only to the extent that
they can perform their function through the officers and crew of the piloted
vessel. Where there is failure by the officers and crew to adhere to their
orders, Harbor Pilots cannot be held liable. In Far Eastern Shipping Co. v.
Court of Appeals, 297 SCRA 30 (1998), this court explained the intertwined
responsibilities of pilots and masters: [W]here a compulsory pilot is in charge
of a ship, the master being required to permit him to navigate it, if the master
observes that the pilot is incompetent or physically incapable, then it is the
duty of the master to refuse to permit the pilot to act. But if no such reasons
are present, then the master is justified in relying upon the pilot, but not
blindly. Under the circumstances of this case, if a situation arose where the
master, exercising that reasonable vigilance which the master of a ship
should exercise, observed, or should have observed, that the pilot was so
navigating the vessel that she was going, or was likely to go, into danger,
and there was in the exercise of reasonable care and vigilance an
opportunity for the master to intervene so as to save the ship from danger,
the master should have acted accordingly. The master of a vessel must
exercise a degree of vigilance commensurate with the circumstances.
ART. 628. The sailing mate must provide himself with charts of the seas
on which he will navigate, with the maps and quadrants or sextants which
are in use and necessary for the discharge of his duties, being liable for
the accidents which may arise by reason of his omission in this matter.
ART. 629. The sailing mate shall particularly and personally keep a book
folioed and stamped on all its pages, denominated “Binnacle Book,” with
a memorandum at the beginning stating the number of folios it contains
signed by the competent authority, and shall enter therein daily the
distance and course travelled, the variations of the needle, the leeway,
the direction and force of the wind, the condition of the atmosphere and
the sea, the rigging set, the latitude and longitude observed, the number
of furnaces with fire, the steam pressure, the number of revolutions, and
under the name “Incidents,’’ the manoeuvres made, the meetings with
other vessels, and all the particular events and accidents which may
occur during the navigation.
ART. 630. In order to change the course and to take the one most
convenient for the good voyage of the vessel, the sailing mate shall come
to an agreement with the captain. Should the latter oppose, the sailing
mate shall explain to him his proper observations in the presence of other
sea officers. Should the captain still insist in his negative decision, the
sailing mate shall make the proper protest, signed by him and by other
one of the officers in the Log Book, and shall obey the captain who alone
shall be liable for the consequences of his decision.
ART. 631. The sailing mate shall be liable for all the damage caused to
the vessel and cargo by reason of his negligence or want of skill, without
prejudice to the criminal liability, which may arise, if a felony or
misdemeanor has been committed.
ART. 632. The following shall be the duties of the second mate:
1. To watch over the preservation of the hull and rigging of the vessel,
and to take charge of the tackle and equipment which make up her outfit,
suggesting to the captain the necessary repairs, and the replacement of
the effects and implements which are rendered useless and lost.
2. To take care that the cargo is well-arranged, keeping the vessel always
ready for maneuvers.
3. To preserve order, discipline, and good service among the crew,
requesting the proper orders and instructions of the captain and giving
him prompt information of any occurrence in which the intervention of his
authority may be necessary.
4. To assign to each sailor the work he must do on board, in accordance
with the instructions received, and to see that it is carried out with
accuracy and promptness.
5. To take charge by inventory of the rigging and all the equipment of the
vessel if she should be laid up, unless the agent may order otherwise.
With regard to engineers, the following rules shall govern:
1. In order to be taken on board as a marine engineer forming part of the
complement of a merchant vessel, it shall be necessary to possess the
qualifications required by the laws and regulations, and to be not
disqualified in accordance therewith to hold said position. Engineers shall
be considered officers of the vessel, but they shall have no authority or
intervention except in matters referring to the motor apparatus.
2. When there are two or more engineers on one vessel, one of them
shall be the chief, and the other engineers and all the personnel of the
engines shall be under his orders; he shall furthermore have the motor
apparatus under his charge, as well as the spare parts, the instruments,
and, finally, whatever is entrusted to an engineer on board a vessel.
3. He shall keep the engines and boilers in good and clean condition, and
shall order what may be proper so they may always be ready for regular
use, being liable for the accidents or damages which may arise by reason
of his negligence or want of skill to the motor apparatus, vessel and
cargo, without prejudice to the criminal liability which may be proper if a
felony or misdemeanor has been committed.
4. He shall make no change in the motor apparatus, nor repair the
averages he may have noticed in it, nor change the normal speed of its
movement, without prior authorization form the captain, to whom, if he
should oppose to their being made, he shall explain the reasons he may
deem proper in the presence of the other engineers or officers; and if,
notwithstanding this, the captain should insist in his objection, the chief
engineer shall make the proper protest, entering the same in the “Engine
Book,” and shall obey the captain who alone shall be liable for the
consequences of his decision.
5. He shall inform the captain of any average which may occur in the
motor apparatus, and notify him whenever it may be necessary to stop
the engines for some time, or when any other accident occurs in his
department of which the captain should be immediately notified besides
frequently advising him of the consumption of fuel and lubricants.
6. He shall keep a book or registry7 called “Engine Book,” in which there
shall be entered all the data referring to the work of the engines, such as
for example, the number of furnaces with fire, the steam pressure in the
boilers and cylinders, the vacuum in the condenser, the temperatures, the
degree of saturation of the water in the boilers, the consumption of fuel
and lubricants, and, under the heading of “Noteworthy Occurrences,” the
average and imperfections which occur in the engines and boilers, the
causes therefore, and the means employed to repair them; also the force
and direction of the wind, the rigging set and the speed of the vessel,
shall be indicated, taking the data from the Binnacle Book.
ART. 633. The second mate shall take the command of the vessel in case
of the inability or disqualification of the captain and sailing mate,
assuming therefore their powers and responsibilities.
ART. 634. The captain may make up his crew of his vessel with such
number as he may deem proper; and in the absence of Filipino sailors, he
may enlist foreigners residing in the Philippines, the number thereof not to
exceed one fifth of the total crew. If in foreign ports the captain could not
find a sufficient number of Filipino sailors, he may make up the crew with
foreigners, with the consent of the consul or marine authorities.
The agreements which the captain may make with the members of the
crew and others who go to make up the complement of the vessel, to
which reference is made in Article 612, must be reduced to writing in the
Account Book, without the intervention of a notary public or clerk of court,
signed by the parties thereto, and vised by the marine authority if
executed in Philippine territory, or by the consuls or consular agents of
the Philippines if executed abroad, stating therein all the obligations which
each one contracts and all the rights he acquires, said authorities, taking
care that these obligations and rights are recorded in a clear and concise
manner which will give no room for doubts or claims.
The captain shall take care to read to them articles of this Code which
concern them, stating in said document that such articles were read.
If the book contains the requisites prescribed in Article 612, and there
should not appear any sign of alterations in its entries, it shall be admitted
as evidence in all 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.
Every member of the crew may demand from the captain a copy, signed
by the latter, of the agreement and of the liquidation of his wages, as they
appear in the book.
ART. 635. 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 to him.
Neither can he pass from the service of one vessel to another without
obtaining the written permission of the captain of the vessel on which he
may be.
If, without obtaining said permission, the sailor who has signed for one
vessel should sign for another one, the second contract shall be void, and
the captain may choose between forcing him to fulfil the service to which
he first bound himself or to look for a person to substitute him at his
expense.
Said sailor shall furthermore lose the wages on his first contract to the
benefit of the vessel for which he has formerly signed.
A captain who, knowing, that the sailor is in the service of another vessel,
should have made a new agreement with him, without requiring of him the
permission referred to in the preceding paragraphs, shall be subsidiarily
liable to the captain of the vessel to which the sailor first belonged for that
part of the indemnity, referred to in the third paragraph of this article,
which the sailor could not pay.
ART. 636. If there is no fixed period for which a sailor has been
contracted, he may not be discharged until the termination of the return
voyage to the port where he enlisted.
ART. 637. Neither can the captain discharge a sailor during the time of
his contract except for just cause, the following being considered as such:
1. The perpetration of a crime, which disturbs order on the vessel.
2. Repeated offenses of insubordination, of want of discipline, or of non-
fulfilment of the service.
3. Incapacity and repeated negligence in the fulfilment of the service he
should render.
4. Habitual drunkenness.
5. Any occurrence, which incapacitates the sailor to perform the work
under his charge, with the exception of the provisions contained in Article
644.
6. Desertion.
The captain may, however, before setting out on a voyage and without
giving reason whatsoever, refuse to permit a sailor he may have engaged
to go on board, and he may leave him on land, in which case his w ages
have to be paid as if he had rendered services.
The indemnity shall be paid out of 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. Should this not be the case, it shall
be paid by the captain personally.
After the voyage has been begun, and during the same and until the
conclusion thereof, the captain may not abandon any member of his crew
on land or on the sea, unless, by reason of some crime, his imprisonment
and delivery to the competent authority in the first port of arrival should be
proper, which shall be obligatory to the captain.
ART. 638. If, after the crew has been engaged, the voyage is revoked by
the will of the ship agent of the charterers, before or after the vessel has
put to sea, or if the vessel by the same cause, is given a different
destination than that fixed in the agreement with the crew, the latter shall
be indemnified by reason of the rescission of the contract in accordance
with the following cases:
1. If the revocation of the voyage should be decided before the departure
of the vessel from the port, each sailor engaged shall be given one month
salary, besides what may be due him, in accordance with his contract, for
the services rendered to the vessel up to the date of the revocation.
2. If the agreement should have been for a fixed amount for the whole
voyage, what may be due for said month and days shall be determined in
proportion to the approximate duration of the voyage, in the judgment of
the experts, in the manner established by the law of civil procedure; and if
the proposed voyage should be of such short duration that it is calculated
at approximately one month, the indemnity shall be fixed at fifteen days,
discounting in all cases the sums advanced.
3. If the revocation should take place after the vessel has put to sea, the
sailors engaged for a fixed amount for the voyage shall receive in full the
salary which may have been offered to them as if the voyage had
terminated; 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, the captain being
obliged, furthermore, to pay said sailors, in both cases, the passage either
to the port of destination or to the port of embarkation, which ever may be
convenient for them.
4. If the ship agent or charterers of the vessel should give her a
destination different from that specified in the agreement and the
members of the crew would not agree thereto, they shall be given by way
of indemnity half of the amount fixed in Subdivision No. 1, 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.
If they accept the alteration, and the voyage, by reason of greater
distance or for other circumstances, should give rise to an increase
wages, the latter shall be adjusted privately or through amicable
arbitrators in case of disagreement. Even if the voyage should be
shortened to a nearer point, this shall not give rise to a reduction in the
wages agreed upon.
If the revocation or alteration of the voyage should originate from the
shippers or charterers, the ship agent shall have a right to demand of
them the indemnity, which may be justly due.
ART. 639. If the revocation of the voyage should arise from a just cause
beyond the control of the ship agent and the charterers and the vessel
should not have left the port, the members of the crew shall have no other
right than to collect the wages earned up to the day the revocation was
made.
ART. 640. The following shall be just causes for the revocation of the
voyage:
1. A declaration of war or interdiction of commerce with the Power to
whose territory the vessel was bound.
2. The blockade of the port of her destination or the breaking out of an
epidemic after the agreement.
3. The prohibition to receive in said port the goods, which make up the
cargo of the vessel.
4. The detention or embargo of the same by order of the Government, or
for any other cause beyond the control of the ship agent.
5. The inability of the vessel to navigate.
ART. 641. If, after the voyage has been begun, any of the first three
causes expressed in the foregoing article should occur, the sailors shall
be paid, at the port which the captain may deem proper to make for the
benefit of the vessel and cargo, according to the time they may have
served thereon; but if the vessel is to continue her voyage, the captain
and the crew may mutually demand the enforcement of the contract.
In case of the occurrence of the fourth cause, the crew shall continue to
be paid half wages if the agreement is by month; but if the detention
should exceed three months, the contract shall be rescinded and the crew
shall be paid what they should have earned according to the contract as if
the voyage had been made. And if the agreement should have been
made for a fixed sum for the voyage, the contract must be complied with
in the terms agreed upon.
If the fifth case, the crew shall have no other right than to collect the
wages earned; but if the disability of the vessel should have been caused
by the negligence or want of skill of the captain, engineer, or sailing mate,
they shall indemnify the crew for damages suffered, without prejudice
always to the criminal liability which may arise.
ART. 642. If the crew have been engaged to work on shares, they shall
not be entitled, by reason of revocation, delay or greater extension of the
voyage, to anything but proportionate part of the indemnity which may be
paid to the common funds of the vessel by the persons responsible for
said occurrences.
ART. 643. If the vessel and her cargo should be totally lost, by reason of
capture or shipwreck, all rights shall be extinguished, both as regard the
right of the crew to demand wages and the right of the ship agent to
recover the advances made.
If a portion of the vessel or of the cargo, or of both, should be saved, the
crew engaged on wages, including the captain, shall retain their rights on
the salvage, as far as possible, on the remainder of the vessel as well as
on the value of the freight or cargo saved; but sailors who are engaged on
shares shall have no right on the salvage of the hull, but only on the
portion of the freight saved. [If they should have worked to recover the
remainder of the shipwrecked vessel, they shall be given from the value
of the salvage an award in proportion to the efforts made and to the risks
encountered in order to accomplish the salvage.
ART. 644. A sailor who falls sick shall not Jose his right to wages during
the voyage, unless his sickness is the result of his own fault. At any rate,
the cost of medical attendance and treatment shall be defrayed from the
common funds, in the form of a loan.
If the sickness should be caused by an injury received in the service or
defense of the vessel, the sailor shall be attended and treated at the
expense of the common funds, deducting, before anything else, from the
proceeds of the freight, the costs of the attendance and treatment.
ART. 645. If a sailor should die during the voyage, his heirs shall be given
the wages earned and not yet received, according to his contract and
cause of his death, namely:
If he died a natural death and was contracted on wages, what may have
been earned up to the date of his death shall be paid.
If the contract was for a fixed sum for the whole voyage, half the amount
earned shall be paid if the sailor died on the voyage out, and the whole
amount if he died on the return voyage.
And if the contract was on shares and his death occurred after the voyage
was begun, the heirs shall be paid the entire participation due the sailor;
but if the sailor died before the departure of the vessel from the port, the
heirs shall not be entitled to claim anything.
If death occurred in defense of the vessel, the sailor shall be considered
as living, and his heirs shall be paid, at the end of the voyage, the full
amount of wages or the full participation on the profits which may be due
him, as others of his class.
Likewise, the sailor who was captured while defending the vessel shall be
considered as present, in order to enjoy the benefits as the rest; but
should he have been captured by reason of negligence or other accident
having no relation with the service, he shall only receive the wages due
up to the day of his capture.
ART. 646. The vessel with her engines, rigging, equipment and freight
shall be liable for the wages earned by the crew engaged per month or for
the trip, the liquidation and payment to take place between one voyage
and the other.
After a new voyage has been begun, credits of such kind pertaining to the
preceding voyage shall lose their preference.
ART. 647. The officers and the crew of the vessel shall be free from all
obligations contracted, if they deem it proper, in the following cases:
1. If, before commencing the voyage, the captain attempts to change it, or
if there occurs a naval war with the nation to which the vessel was
destined.
2. If a disease should break out and be officially declared an epidemic in
the port of destination.
3. If the vessel should change owner or captain.
ART. 648. By the complement of a vessel shall be understood all the
persons embarked, from the captain to the cabin boy, necessary for the
management, maneuvers, and service, and, therefore, in the complement
shall be included the crew, sailing mates, engineers, stockers, and others
working on board not having specific names; but it shall not include the
passengers or the persons whom the vessel is only transporting.

SUPER CARGOES
Super cargo in maritime law is a person especially employed by the
owner of a cargo to take charge of and sell to the best advantage
merchandise which has been shipped, and to purchase returning cargoes
and to receive freight, as he may be authorized.

ART. 649. The supercargoes shall discharge on board the vessel the
administrative duties which the ship agent or shippers may have assigned
to them; they shall keep an account and record of their transactions in a
book which shall have the same conditions and requisites as those
required for the accounting book of the captain, and shall respect the
latter in his duties as chief of the vessel.

The power and responsibilities of the captain shall cease, when there is a
supercargo, with regard to that part of the administration legitimately
conferred upon the latter, but they shall continue in force for all acts,
which are inseparable from his authority and office

ART. 650. All the provisions contained in the Second Section of Title III,
Book II, with regard to qualifications, manner of making contracts, and
liabilities of factors, shall be applicable to supercargoes.

ART. 651. Supercargoes cannot, without authorization or express

agreement, make any transaction for their own account during the
voyage, with the exception of the ventures which, in accordance with the
custom of the port of destination, they are permitted to do.
Neither can they invest in the return voyage more than the profit from the
ventures, unless there is an express authorization from the principals