VESSELS:

VESSEL - A vessel or watercraft is defined under P.D. 474 as "any barge, lighter, bulk
carrier, passenger ship freighter, tanker, container ship, fishing boats, or other artificial
contrivance utilizing any source of motive power, designed, used or capable of being
used as a means of transportation operating either as a common contract carrier, including
fishing vessels covered under P.D. 43. EXCEPT, (i) those owned and/or operated by the
Armed Forces of the Philippines and by foreign governments for military purposes, and
(i) bancas, sailboats and other waterborne contrivance of less than three gross tons
capacity and not motorized."
 every kind of craft by whatever particular or technical name it may now be known
or which nautical advancements may give it in the future (Yu Con vs aioli).
 Not accessory to another like launches or lifeboats.
MARINA MEMORANDUM CIRCULAR NO. O5, SERIES OF 2009 govern the
operation of motorized bancas that are traditionally built watercraft, predominantly
wooden-hulled and propelled mechanically, with or without outrigger. The regulation
requires the registration of all motorized bancas and boat builders.
SOLAS 1974
1. A passenger ship is a ship which carries more than 12 passengers.
2. A cargo ship is any ship which is not a passenger ship.
3. A tanker is a cargo ship constructed or adapted for the carriage in bulk of liquid
cargoes of an inflammable nature.
4. A fishing vessel is a vessel used for catching fish, whales, seals, walrus or other
living resources of the sea.
5. A nuclear ship is a ship provided with a nuclear power plant.
6. "New ship" means a ship the keel of which is laid or which is at a similar stage of
construction on or after the date of coming into force of the SOLAS 1974.
7. Existing ship means a ship which is not a new ship.
LOPEZ v DURUELO - No, protest is not necessary. Article 835 referred to was not
intended to include all ships, craft or floating structures of every kind without limitation,
and the provisions of that section should not be held to include minor craft engaged only
in river and bay traffic. Vessels which are licensed to engage in maritime commerce, or
commerce by sea, whether in foreign or coastwise trade, are no doubt regulated by Book
III of the Code of Commerce. Other vessels of a minor nature not engaged in maritime
commerce, such as river boats and those carrying passengers from ship to shore, must be
governed, as to their liability to passengers, by the provisions of the Civil Code or other
appropriate special provisions of law.
CONSTRUCTION, EQUIPMENT AND MANNING - subject to the rules on maritime
industry authority and coast guard and pertinent conventions like SOLAS 1974.
ARTICLE 574. Builders of vessels may employ the materials and follow, with respect to
their construction and rigging, the systems most suitable to their interests. Ship owners
and seamen shall be subject to what the laws and regulations of the public administration
on navigation, customs, health, safety of vessels, and other similar matters.
INTERNATIONAL CONVENTION ON LOAD LINES 1966 which was adhered to
by the Philippines in 1969 provides for uniform rules with respect to the limits to which
ships on international voyages may be loaded having regard to the need for
safeguarding life and property at sea.
INTERNATIONAL CONVENTION ON TONNAGE MEASUREMENT OF
SHIPS, 1969,7 which was adhered to in 1982, provides for rules for the determination of
tonnage of ships engaged in international voyages. Under the Convention "gross
tonnage" means the measure of the overall size of a ship while "net tonnage" means the
measure of the useful capacity of a ship.
VESSEL AS PERSONAL PROPERTY
Article 416. NCC
ARTICLE 585. For all purposes of law not modified or restricted by the provisions of
this Code, vessels shall continue to be considered as personal property.
PHILIPPINE REFINING COMPANY vs JARQUE - vessels are a peculiar kind of
personal property. This they are subject to mortgage agreeably to the provisions of the
chattel mortgage law. The only difference between a chattel mortgage of a vessel and a
chattel mortgage of other personality is that it is not now necessary for a chattel mortgage
of a vessel to be noted in the registry of the register of deeds, but it is essential that a
record of documents affecting the title to a vessel be entered in the record of the
Collector of Customs at the port of entry.
RUBISO and CALIXTO v RIVERA - that "ships or vessels, whether moved by steam or
by sail, partake, to a certain extent, of the nature and conditions of real property, on
account of their value and importance in the world commerce." For instance, under
Article 573 of the Code of Commerce, transfer of vessels should be in writing and must
be recorded in the appropriate registry.
ACQUISITION
may be acquired or transferred by any means recognized by law.
Article 712. Ownership is acquired by occupation and by intellectual creation.
Ownership and other real rights over property are acquired and transmitted by law, by
donation, by testate and intestate succession, and in consequence of certain contracts, by
tradition.
They may also be acquired by means of prescription. 
THEORY OF MODE AND TITLE - ownership is acquired by another only if mode
and title concurs. MODE - the specific cause, which gives rise to them, as the result of
the presence of a special condition of things, of the aptitude and intent of persons, and of
compliance with the conditions established by law. The proximate cause of the
acquisition. TITLE - is the juridical justification for the acquisition or a transfer of
ownership or other real right. This is the remote cause of the acquisition.
MARITIME INDUSTRY AUTHORITY - vessels that are under the jurisdiction of the
MIA can be transferred only with approval of said administrative agency. In addition,
after the approval of the sale or transfer, it is required that the buyer shall within 15 days
from approval of the MARINA secure a new Certificate of Philippine Registry and
Certificate of Ownership.
PRESCRIPTION
ARTICLE 573. Merchant vessels constitute property which may be acquired and
transferred by any of the means recognized by law. The acquisition of a vessel must
appear in a written instrument, which shall not produce any effect with respect to third
persons if not inscribed in the registry of vessels.
The ownership of a vessel shall likewise be acquired by possession in good faith,
continued for three years, with a just title duly recorded.
In the absence of any of these requisites, continuous possession for ten years shall
be necessary in or- der to acquire ownership.
A captain may not acquire by prescription the vessel of which he is in command.
REQUISITES FOR PRESCRIPTION
1. Continuous possession
2. Must be for a period of three years
3. Possession in good faith
POSSESSION IN GOOD FAITH - presupposes possession in the concept of an owner.
A possessor is in good faith if he is not aware of the flaw or defect in his title. He
believes or thinks that he is the owner of subject property and asserts such ownership.
POSSESSOR IN BAD FAITH - if he acted knowing that he is not the owner of the
subject land or knowing that there is a flaw in his title. Accordingly, the co-owner, lessee,
usufructuary, and trustee cannot be possessors in good faith if they are in possession as
such. They recognize the ownership or right of another person or persons.
SALE
Article 1477. The ownership of the thing sold shall be transferred to the vendee upon the
actual or constructive delivery thereof.
NOTE: However, the sale must be registered with the Marina to affect third persons.
ARTICLE 576. The rigging, tackle, stores, and engine of a vessel, if it is a steamer, shall
always be understood as included in the sale thereof if they are owned by the vendor at
the time of the sale.
The arms, munitions of war, provisions, and fuel shall not be considered as
included in the sale.
The vendor shall be under the obligation to deliver to the purchaser a certificate of
the record of the vessel in the registry up to the date of the sale.
ARTICLE 577. If the alienation of the vessel should take place while said vessel is on a
voyage, the purchaser shall receive all the freights it earns from the time it received
its last cargo, and the payment of the crew and other persons which go to make up its
complement shall be paid by the purchaser for the said voyage.
If the sale takes place after the arrival of the vessel at the port of its
destination, the freights shall belong to the vendors and he shall pay the crew and other
persons which go to make up its complement, unless there is an agreement to the contrary
in either case.
ARTICLE 578. If, the steamer being on a voyage or in a foreign port, her owner or
owners should voluntarily alienate her either to Filipino  or to foreigners domiciled in
the capital or in a port of another country, the bill of sale shall be executed before the
consul of Philippines at the port where it terminates its voyage, and said instrument
shall have no effect with regard to third persons if it is not recorded in the registry of
the consulate. The consul shall immediately forward a true copy of the instrument of
purchase and sale of the vessel to the registry of vessels of the port where said vessel is
inscribed and registered.
In every case the alienation of the vessel must be stated, indicating whether the vendor
receives the full price or part thereof, or whether he retains any interest in said vessel in
full or in part. In case the sale is made to a Filipino,  this fact shall be stated in the
certificate of navigation.
When, the ship being on a voyage, it should be rendered useless for navigation, the
captain shall apply to the judge or court of competent jurisdiction of the port of arrival,
should it be a foreign port, to the consul of Spain, * should there be one or to the judge,
or court, or local authority in the absence of the former; and the consul, or the judge, or
court, or in their absence, the local authority, shall order an examination of the vessel to
be made.
If the consignee or the underwriter should reside at said port, or should have
representatives there, they must be cited in order to take part in the proceedings for the
account of whom it may concern.
ARTICLE 579. After the damage to the vessel has been proven as well as the
impossibility of her being repaired, to continue the voyage, her sale at public auction
shall be ordered, subject to the following rules:
1. The hull of the vessel, her rigging, engines, stores, and other articles shall be
appraised by means of an inventory, said proceedings being brought to the notice
of the persons who may wish to take part in the auction.
2. The order or decree ordering the auction to be held shall be posted in the usual
places, an announcement thereof to be inserted in the Official Gazette and in two
of the newspapers of the largest circulation of the port where the auction is to be
held, should there be any. The period which may be fixed for the auction shall not
be less than twenty days.
3. These announcements shall be repeated every ten days, and their publication shall
be made to appear in the records.
4. The auction shall be held on the day fixed, with the formalities prescribed in the
common law for judicial sales.
5. If the sale should take place while the vessel is in a foreign country, the special
provisions governing such cases shall be observed.
CO-OWNER'S RIGHTS.
If the vessel is sold to third persons, the co-owner is given the right of redemption in
accordance with Article 575 of the Code of Commerce which provides:
ARTICLE 575. Co-owners of vessels shall have the right of repurchase and
redemption in sales made to strangers, but they may exercise the same only within
the nine days following the inscription of the sale in the registry, and by depositing
the price at the same time.
NATIONALITY OF VESSELS.
Vessels that are duly registered in the Philippines are considered Philippine Flag
vessels. These ships are deemed to possess Philippine nationality within the
contemplation of the United Nations Convention on the Law of the
REGISTRATION
Vessels are now registered through the Maritime Industry Authority. It is a long
standing rule that the person who is the registered owner of the vessel is presumed
to be the owner of the vessel. Moreover, it is likewise a settled rule that the sale or
transfer of the vessel is not binding on third persons unless the same is registered.
SECTION 810. TCC. Privileges Conferred by Certificate of Philippine Registry. A
certificate of Philippine registry confers upon the vessel the right to engage,
consistently with law, in the Philippine coastwise trade and entitles it to the protection
of the authorities and the flag of the Philippines in all ports and on the high seas, and
at the same time secures to it the same privileges and subjects it to the same
disabilities as, under the laws of the Philippines, pertain to foreign-built vessels
transferred abroad to citizens of the Philippines.
Registration of vessels under the Philippine Flag is also required for shipping
enterprises engaged in overseas shipping that wishes to avail of the benefits under the
Philippine Overseas Shipping Development Act or R.A. 7471.
Section 8 of R.A. 7471 provides: SECTION 8. Registration and Deletion of Vessels.
All vessels owned by Philippine shipping enterprises and availing of the incentives
under this Act shall be registered under the Philippine flag. Said vessels can only be
deleted from the Philippine registry after the MARINA has determined that: (a) No
other Philippine shipping enterprise is interested in acquiring the vessel; or (b) The
vessel has to be scrapped.
FUBISO VS RIVERA - with respect to the rights of the two purchases, whichever of
them first registered his acquisition of the vessel is the one entitled to enjoy the
protection of the law, which considers him the absolute owner of the purchased boat,
and the latter to be free of all encumbrance and all claims by strangers for, pursuant to
Article 582 of the said code, after the bill of the judicial sale at auction has been
executed and recorded in the commercial registry, all the other liabilities of the vessel
in favor of the creditors shall be considered canceled.
MARINA MEMORANDUN CIRCULAR NO. 2013-02 Revised Rules for the
Registration, Documentation and Deletion of Ships Operating in Philippine Waters.
The Rules apply to all types of ships operating in the Philippine waters regardless of
size and utilization, whether with power or without power, including those ships
below the gross tonnage motorized or non-motorized.
EXCEPTIONS:
Warships and naval ships
Ships of the Philippine coast guard
All ships of foreign registry temporarily used in the Philippine waters Inflatable boats
used for rescue made of either a single or more rubber tubing.
 Ship Registration refers to the documentation and authorization of a ship to
sail under the Philippine flag.
 Domestic Trade The carriage of passengers and/or cargoes between two or
more ports and places in the Philippines by the use of vessel either as common
or contract carrier or for exclusive company/own use including operations
within bays and rivers and other inland waterways.
 Overseas Trade The transport of goods and or passengers and/or vessel
operations outside of Philippine territorial waters, including those calls at
Philippine ports from foreign ports and vice versa.
SHIP’S MANIFEST
Vessels are required to carry manifests in coastwise trade.
Section 906 of the Tariff and Customs Code provides that "manifests shall be
required for cargo and passengers transported from one place or port in the
Philippines to another only when one or both of such places is a port of entry.'
This requirement is likewise imposed on every vessel from a foreign port under
Section 1005 of the same Code.
A MANIFEST IS A DECLARATION OF THE ENTIRE CARGO. The object of
a manifest is to furnish customs officers with a list to check against, to inform the
revenue officers what goods are being brought into a port of the country on a vessel.
Hence, the requirement that a vessel must carry a manifest is not complied with even
if a bill of lading can be presented. A bill of lading is just a declaration of a specific
cargo rather than the entire cargo. It is issued as a matter of convenience by virtue of a
contract.
MARINA Memorandum Circular No. 13, Series of 2009 dated May 29, 2009
provides for the following rules: (1) The total number of passengers on board shall not
exceed the total number of passengers allowed for each ship. (2) All passengers on
board the ship shall be duly manifested as reflected in the Passenger Manifest. (3)
Manifest or passenger list should be prepared and made available before the ship
leaves port. (4) Children three years and above shall be counted as adult passengers
and shall be assigned seats. (5) Children below three years old shall be carried by an
adult at all times.
LOGBOOK. A ship's log/logbook is the official record of a ship's voyage which its
captain is obligated by law to keep wherein he records the decisions he has adopted, a
summary of the performance of the vessel, and other daily events. A logbook is a
respectable record that can be relied upon when the entries therein are presented in
evidence.
CABOTAGE.
The right of cabotage is the right of foreign vessels to engage in coastwise shipping,
that is, to provide service from one place within the Philippines to another place in
the Philippines. Previously, foreign vessels do not have the right of cabotage. The
governing rule can be found in Sections 810, 902, 1009 of the Tariffs and Customs
Code and Sections 5, 6, and 7 of Domestic Shipping Development of 2004.
The right to cabotage is now provided for under present laws. The present law is R.A.
10668, otherwise known as the Foreign Ships Co-Loading Act. It was signed into
law by the President on July 21, 2015. Under the new law, foreign ships carrying
foreign cargoes are allowed to dock in multiple ports in the country subject to
compliance with the clearance requirement. The carriage of Goods by Sea Act applies
to the carriage of goods under this law. However, the foreign carrier is not a public
service and not a common carrier.
REPAIR OF VESSELS.
Ship repairers are liable to the ship owner for any damage that was caused to the
vessel while the same is undergoing repairs. Thus, the ship repair may be held
liable for the loss of the vessel if it was gutted by fire while the vessel is in its
dockyard due to the negligence of the former. However, both the ship repairer and the
shipowner will shoulder the loss if they are equally negligent.
With respect to the liability of the ship repairer, the parties may validly agree to limit
the said ship repairer's liability.so
However, the validity of the limit of liability of the ship repairer would depend upon
the circumstances.
MORTGAGE OF VESSELS
PREFERED MORTGAGE.
Section 10. Lien of preferred Mortgage; foreclosure; jurisdiction; procedure A
preferred mortgage shall constitute a lien upon the mortgaged vessel in the
 amount of the outstanding mortgage indebtedness secured by such vessel. Upon
the default of any term or condition of the mortgage such lien may be enforced by the
mortgagee by suit in remaining admiralty, wherein the vessel itself may be made a
partly defendant and be arrested in the manner as provided in Section 11 hereof.
CLAIMS THAT PREVAIL OVER SHIP MORTGAGE
Section 17. Preferred Maritime Lien, Priorities, Other Liens
(a.)Upon the sale of any mortgaged vessel in any extra-judicial sale or by order of
a district court of the Philippines in any suit in rem in admiralty for the
enforcement of a preferred mortgage lien thereon, all pre-existing claims in
the vessel, including any possessory common-law lien of which a lienor is
deprived under the provisions of Section 16 of this Decree, shall be held
terminated and shall thereafter attach in like amount and in accordance
with the priorities established herein to the proceeds of the sale. The
preferred mortgage lien shall have priority over all claims against the vessel,
except the following claims in the order stated: (1) expenses and fees allowed
and costs taxed by the court and taxes due to the Government; (2) crew's
wages; (3) general average; (4) salvage; including contract salvage; (5)
maritime liens arising prior in time to the recording of the preferred
mortgage; (6) damages arising out of tort; and (7) preferred mortgage
registered prior in time.
(b.) If the proceeds of the sale should not be sufficient to pay all creditors
included in one number or grade, the residue shall be divided among them
pro rata. All credits not paid, whether fully or partially shall subsist as
ordinary credits enforceable by personal action against the debtor. The
record of judicial sale or sale by public auction shall be recorded in the Record
of Transfers and Encumbrances of Vessels in the port of documentation.\
Notice of their existence is not necessary.
WHO MAY CONSITUTE A SHIP MORTGAGE
Section 2. Who may Constitute a Ship Mortgage. Any citizen of the Philippines, or
any association or corporation organized under the laws of the Philippines, at least
sixty per cent of the capital of which is owned by citizens of the Philippines may, for
the purpose of financing the construction, acquisition, purchase of vessels or initial
operation of vessels, freely constitute a mortgage or any other lien or encumbrance on
his or its vessels and its equipment with any bank or other financial institutions,
domestic or foreign.
REQUIREMENTS
Section 4. Preferred Mortgages
(a) A valid mortgage which at the time it is made includes the whole of any vessel of
domestic ownership shall have, in respect to such vessel and as of the date of
recordation, the preferred status given by the provisions of Section 17 hereof, if
1. The mortgage is recorded as provided in Section 3 hereof;
2. An affidavit is filed with the record of such mortgage to the effect that the
mortgage is made in good faith and without any design to hinder, delay,
or defraud any existing or future creditor of the mortgagor or any lien
or of the mortgaged vessel;
3. The mortgage does not stipulate that the mortgagee waives the preferred
status thereof;
MARITIME LIEN
An ACTION IN PERSONAM is a proceeding to enforce personal rights and
obligations brought against the person and is based on the jurisdiction of the person,
although it may involve his right to, or the exercise of ownership of, specific property,
or seek to compel him to control or dispose of it in accordance with the mandate of
the court, some responsibility or liability directly upon the person of the defendant.