TRANSPORTATION ASSIGN NO 2

1. What is a charter party?

A charter is a contract by which an entire ship, or some principal part thereof is

let/leased by the owner to another person for a specified time or use. (Planters
Products, Inc. vs. CA, 226 SCRA 476)

REQUISITES OF A VALID CHARTER

PARTY
1. Consent of the contracting parties
2. Existing vessel which should be placed at the disposition of the shipper
3. Freight
4. Compliance with Art. 652 of the Code of Commerce

2. Does a charter party between a ship owner and a charterer transform a common
carrier into a private one?

No. A public carrier or common carrier shall remain as such, notwithstanding the
charter of the whole or portion of a vessel by one or more persons, provided the
charter is limited to the ship only, as in the case of a time-charter or voyage-charter.

It is only when the charter includes both the vessel and its crew, as in a bareboat or
demise that a common carrier becomes private, at least insofar as the particular
voyage covering the charter-party is concerned. Indubitably, a shipowner in a time
or voyage charter retains possession and control of the ship, although her holds may,
for the moment, be the property of the charterer. 

3. What is a Contract of Affreightment?

A contract of affreightment is a class of charter-party, whereby the owner of the

vessel leases part or all of its space to haul goods for others. In such contract, the
shipowner retains the possession, command and navigation of the ship, the charterer
merely having use of the space in the vessel in return for his payment of the charter
hired.

4. What is time charter?

A time charter is a contract of affreightment whereby the vessel is chartered or

leased for a fixed period of time or duration of voyage. From the name itself, this is a
time-bound agreement. Although the charterer controls the ship, the maintenance of
the vessel still falls under the purview of the owner.
5. What is a voyage charter?

A voyage charter, is a contract of affreightment whereby the vessel is leased out for
one or series of voyages usually for purposes of transporting goods for charterer.
This is intended for a particular voyage and the agreement lists the ports of call,
destination, and restrictions on cargo, if any.

6. What is charter by demise or Bare Boat Charter, v.v. Contract of affreightment

This is a charter-party which grants ownership or possession of the vessel to the

charterer subject to certain time-bound conditions.

The charterer provides crew, food and fuel. The charterer is liable as if he were the
owner, except when the cause arises from the unworthiness of the vessel. The
shipowner leases to the charterer the whole vessel, transferring to the latter the
entire command, possession and consequent control over the vessel’s navigation,
including the master and the crew, who thereby become the charter’s servants. It
transforms a common carrier into a private carrier.

The charterer becomes the owner of the vessel pro hac vice, just for that one
particular purpose only. Because the charterer is treated as owner pro hac vice, the
charterer assumes the customary rights and liabilities of the shipowner to third
persons and is held liable for the expense of the voyage and the wages of the
seamen.

Charter-Party
Contract of Affreightment Contract of Demise (Bare
Time Charter Voyage Charter Boat Contract)

7. COMPARISON CARRIAGE OF GOODS and PASSENGERS