Maritime Law

Maritime law is the system of laws which "particularly relates to the affairs and business of the sea,
to ships, their crews and navigation, and to marine conveyance of persons and property ." It has also
been defined as a corpus of rules, concepts, and legal practices governing certain centrally important
concerns of the business of carrying goods and passengers by water." The terms Maritime Law and
Admiralty Law are sometimes used synonymously. Maritime Law is also defined as "that system of
law which particularly relates to marine commerce and navigation, to business transacted at sea or
relating to navigation, to ships and shipping, to seamen, to the transportation of persons and property
by sea and to marine affairs generally."
Real and hypothecary nature
Unlike civil law rules, Maritime law is real and hypothecary in nature. The evidence of this "real"
nature of the maritime law are:
(1) Limit of Liability - the limitation of the liability of the agents to the actual value of the vessel
and the freight money; and
(2) Maritime Lien - 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.
"That which distinguishes the maritime from the civil law and even from the mercantile law in
general is the real and hypothecary nature of the former, and the many securities of a real nature that
maritime customs from time immemorial, the laws, the codes, and the later jurisprudence, have
provided for the protection of the various and conflicting interest which are ventured and risked in
maritime expeditions, such as the interests of the vessel and of the agent, those of the owners of the
cargo and consignees, those who salvage the ship, those who make loans upon the cargo, those of the
sailors and members of the crew as to their wages, and those of a constructor as to repairs made to
the vessel.
"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.
"This repeals the civil law to such an extent that, in certain cases, where the mortgaged property is
lost no personal action lies against the owner or agent of the vessel. For instance, where the vessel is
lost the sailors and of the crew cannot recover their wages; in case of collision, the liability of the
agent is limited as aforesaid, and in case of shipwrecks, those who loan their money on the vessel and
cargo lose all their rights and cannot claim reimbursement under the law.
Maritime Lien
Maritime lien is akin to a mortgage lien in that in spite of the of ownership, is not extinguished. The
maritime lien is inseparable from the vessel and until discharged, it follows the vessel. Hence, the
enforcement of a maritime lien is in the nature and character of a proceeding quasi in rem.
A maritime lien is the foundation of the proceeding in rem, a process to make perfect a right inchoate
from the moment the lien attaches; and whilst it must be admitted that that where such a lien exists, a
proceeding in rem may be had, it will be found to be equally true, that in all cases where a
proceeding in rem is the proper course of action, where a maritime lien exists, which gives a
privilege or claim upon the thing, to be carried into effect by legal process. This claim or privilege
travels with the thing, into whosoever possession it may come.
Limited Liability rule
No vessel, no liability,' expresses in a nutshell the limited liability rule. The shipowner's 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 total destruction of the vessel extinguishes maritime liens because there is no
longer any res to which it can attach." The Supreme Court explained in another that the real and
hypothecary nature of maritime law simply means that the liability of the carrier in connection with
losses related to maritime contracts is confined to the vessel, which is hypothecated for such
obligations or which stands as the guaranty for their settlement." It developed by reason of the
conditions and attending maritime trade in its earliest years when such trade was replete with
innumerable and unknown hazards since vessels had to go through largely uncharted waters to ply
their trade. It was designed to offset such adverse conditions and to encourage people and entities to
venture into maritime commerce despite the risks and the prohibitive cost of shipbuilding. Thus, the
liability of the vessel owner and agent arising from the operation of such vessel were confined to the
vessel itself, its equipment, freight, and insurance, if any, which limitation served to induce
capitalists into effectively wagering their resources against the consideration of the large profits
attainable in the trade.
EXCEPTIONS TO LIMITED LIABILITY. There are exceptions to the limited liability rule,
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.
NEGLIGENCE OF SHIPOWNER AND AGENT. The limited liability rule applies if the captain
or the crew caused the damage or injury. For instance, the shipowner's or ship agent's liability is
limited to the value of the vessel if the damage was caused by the unseaworthiness of the vessel
caused by the negligence of the captain or crew during the voyage. However, if the failure to
maintain the seaworthiness of the vessel can be ascribed to the shipowner alone or the shipowner
concurrently with the captain, then the limited liability cannot be invoked.
Definition of maritime law and 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: (1) those
owned and/or operated by the Armed Forces of the Philippines and by foreign governments for
military purposes, and (ii) bancas, sailboats and other waterborne contrivance of less than three gross
tons capacity and not motorized." The above- quoted definition is important for purposes of applying
the laws and regulations that are being implemented by the Maritime Industry Authority.
Note: Vessel is a personal property.
Nationality of vessel
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 Sea.
FLAGS OF CONVENIENCE. Article 92 of the UNCLOS provides that there must be a genuine
link between the State and the ship in order to confer nationality over the ship. There are instances
when countries may allow registration of vessels belonging to nationals of other countries. There is
no genuine link between the State and the ship and the registration is just a matter of convenience,
hence, the term Flags of Convenience. The absence of genuine link is reflected in either the absence
or minimal regulation of the registered vessels by the country where the vessels are registered. The
Philippines is not a "Flag of Convenience" country.
REGISTRATION OF VESSELS. 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.
Ship manifest and logbook
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. 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."
b. Memorandum Circular No. 180 approved on October 7, 2002 provides for rules on Passenger
Manifest on board Philippine registered passenger ships. The circular likewise prescribed the form
for the Passenger Manifest.
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."
In Wallem Maritime Services, Inc. v. National Labor Relations Commission," citing Haverton
Shipping Ltd. v. National Labor Relations Commission," the Court ruled that a copy of an official
entry in the logbook is legally binding and serves as an exception to the hearsay rule. In the said case,
however, there was no controversy as to the genuineness of the said entry and the authenticity of the
copy presented in evidence.
Cabotage definition only
The right of is the right of foreign vessels to engage in coastwise shipping, that is, to provide 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.
Liability of ship owner and ship agent
The shipowner is the person who is primarily liable for damages sustained in the operation of vessel.
A perusal of the provisions of the Code of Commerce likewise indicates the evident intent to place
the primary responsibility on the owner of the vessel.
a. Nevertheless, the Code of Commerce at times uses the term "naviero" to indicate the person
who is liable. The "naviero" has been construed to include the shipowner, ship agent and
even the charterer who is considered as owner pro hac vice.
A "ship agent" is defined in the Code of Commerce as the person entrusted with provisioning of the
vessel, or who represents her in the port in which she happens to be. From the above-quoted
explanation, it is evident that the Code of Commerce likewise makes the ship agent jointly and
severally liable with the owner.
EXTENT OF LIABILITY. The joint and several liability applies both for breach of contract and
extra-contractual obligation such as tort. Indeed, the ship agent, even though he is not the owner, is
liable in every way to the creditor for losses and damages, without prejudice to his right against the
owner, the vessel and its equipment and freight. The liability is however subject to the limited
liability rule.
The shipowner and the ship agent are liable in certain cases even if the captain has exceeded his
authority if the proceeds of an obligation redounded to the benefit of the vessel.
Powers and function of ship agent
Whether acting as agent of the owner of the vessel or as agent of the charterer, petitioner will be
considered as the ship agent and be held liable as such, as long as the latter is the one that provisions
or represents the vessel. may
Article 595 of the Code of Commerce provides that ship agent, whether he is at the same time the
owner of the vessel, of a manager for an owner or for an association of co-owners, must have the
capacity to trade and must be recorded in the merchant's registry of the province.
POWERS OF SHIP AGENT. The ship agent can enter into contracts to provision the ship. Hence,
he can purchase necessary supplies and fuel that are necessary for a particular voyage. On the other
hand, representation of the vessel includes the right to represent the vessel in any action in a court or
tribunal. Article 595 of the Code of Commerce provides that 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.
Captains and masters of vessels
In Yu

Con v. Glicerio Ipil, et al., the Supreme Court quoted Spanish commentaries on the Code of
Commerce which explain that strictly speaking, "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 are
engaged in the coastwise trade. Masters are those who command smaller ships engaged exclusively
in the coastwise trade.""
a. Nevertheless, it was also clarified that "for the purposes of commerce, the words 'captain' and
'master' have the same meaning; both being the chiefs or commanders of ships." Thus, the terms
"captain" and "master" are used synonymously in the Code of Commerce.
b. Similarly, pertinent regulations issued by the Maritime Industry Authority (MARINA) define a
"master" as the person having command of the ship." The same term is being used both for domestic
trade and international trade. On the other hand, a "boat captain" means a person authorized by the
MARINA to act as officer and/or in command of a boat/ship or has the qualification/license to act as
such.20
whole chapters of charter parties
Definition of loans and bottomry
Bottomry, in maritime law, is a contract whereby the owner of a ship borrows for the use, equipment
or repair of the vessel, for a definite term, and pledges the ship (or the keel or bottom of the ship pars
pro toto) as security. with the stipulation that if the ship is lost during the voyage or during the
limited time on account of the perils enumerated, the lender shall lose his money."
a. Where the goods, or some part thereof, are hypothecated as security for a loan, the repayment of
which is dependent upon maritime risks, what ensues is a loan on respondentia.
b. The usual form of a loan on respondentia is that of a bond. In this kind of maritime loan, it is the
borrower's personal responsibility which is deemed to be the principal security for the performance
of the contract, hence the term "respondentia."
C. There must be a marine risk upon which the loan is predicated such that if the vessel or the cargo
is lost by virtue of that risk, the lender loses the capital or money lent. Thus, there is neither bottomry
nor respondentia if the money borrowed is subject to repayment in any event.
d. The peculiarity of the loans on bottomry and respondentia arose from the hazards of the trade
whereby the lender had to bear with, and assume, the numerous marine perils that lay in the path of
many a ship's voyage; and thus, upon the termination of a safe journey, he is entitled to receive
thereby a greater return on his principal than would ordinarily be received by a lender in an ordinary
or simple loan. However, the lender in a loan on respondentia does not lose his capital should the
ship perish due to marine peril, so long as the goods subject of the loan survive or are saved; but
where the ship and the cargo on board should disappear due to perils of the sea, the lender on
respondentia shall suffer loss of his capital.
Collisions
DEFINITION. Collision is defined as an impact or sudden contact of a moving body with an
obstruction in its line of motion, whether both bodies are in motion or one stationary and the other.
no matter which, in motion. As applied to Maritime Commerce, collision is therefore an impact or
sudden contact of a vessel with another whether both are in motion or one stationary.
a. Strictly speaking, collision refers to the contact of two moving vessels. If one vessel is moving
while the other is stationary, the same is more appropriately called "allision." Nevertheless, for
purposes of applying the provisions of the Code of Commerce, collision includes collision per se and
allision.
b. However, it should be emphasized that it is not necessary for one to be liable for his vessel to have
hit another. A shipowner or ship agent may be made liable even if his vessel did not actually collide
with another vessel. This situation is covered by Article 831 of the Code of Commerce which makes
the owner of a third vessel liable if it forced a vessel to hit another.
Rules on liability only
Although the liability with respect to collision is not governed by quasi-delict, liability in collision
cases is still negligence based. In other words, courts are still called upon to determine the negligence
of the persons involved in order to impose liability. The person who caused the injury is both civilly
and criminally liable. The Code of Commerce provides:
ARTICLE 829. In the cases above mentioned the civil action of the owner against the person
causing the injury as well as the criminal liabilities, which may be proper, are reserved.

a. In the determination of negligence, the same test of a reasonable man in the position of an expert
that applies in quasi- delict should also be applied although with due consideration to the expertise of
the persons involved including the carrier itself, the captain, officers and crew of the vessels. Thus, it
is still required to determine if a reasonable man with the same expertise would have done what the
party in question did under the same circumstances. It is still relevant to determine if the collision is
sufficiently foreseeable such that a reasonable man with the same expertise could have avoided the
impact.
Arrival under stress and shipwreck definition only
A definition of "arrival under stress" can be derived from Article 819 of the Code of Commerce.
Under said provision, "arrival under stress" is the arrival of a vessel at the nearest and most
convenient port which was decided upon after determining that there is well-founded fear of seizure,
privateers, or pirates or by reason of any accident of the sea disabling it to navigate.
Shipwreck has been defined as the "demolition or shattering of a vessel caused by her driving ashore
or on rocks and shoals in the midseas, or by the violence of winds and waves in tempests."
Definition of averages and salvage
In general, salvage may be defined as a service which one person renders to the owner of a ship or
goods, by his own labor, preserving the goods or the ship which the owner or those entrusted with the
care of them have either abandoned in distress at sea, or are unable to protect and secure.