1.

Bill of Lading – written acknowledgment of receipt of goods and agreement to transport them to
a specific place to a person named or his carrier

It is not indispensable to the creation of a contract of carriage. The contract itself arises from the
moment goods are delivered by shipper to carrier and the carrier agrees to carry them.

The function of the Bill of Lading: the legal basis of the contract between the shipper and carrier
shall be the bills of lading, by the contents of which all disputes which may arise with regard to
their execution and fulfillment shall be decided, no exceptions being admissible other than
forgery or material errors in the drafting thereof.

Carrier’s responsibility starts from the moment he receives unconditionally the merchandise
personally or through an agent and lasts until he delivers them actually or constructively to the
consignee or his agent.

Mere delay in the delivery of goods to consignee does not give right to refuse goods – only breach
of contract, ergo damages. If delay is unreasonable, then he may refuse to accept and make
carrier liable for conversion.

1. 7. Vessels – those engaged in navigation, whether coastwise or on the high seas, including
floating docks, pontoons, dredges, scows and any other floating apparatus destined for the
services of the industry or maritime commerce
1. 8. Persons Participating in Maritime Commerce:
1. a. ship owner and/or ship agent
2. b. captain or master
3. c. other officers of the vessel
4. d. supercargo
1. 9. Liability of Ship owners and Ship agents:
1. a. civil liability for the acts of the captain
2. b. civil liability for contracts entered into by the captain to repair, equip and
provision the vessel, provided that the amount claimed was invested for the benefit of
the vessel
3. c. civil liability for indemnities in favor of 3 rd persons which may arise from the
conduct of the captain in the care of the goods which the vessel carried, as well as for the
safety of the passengers transported
 Ship owner/ship agent not liable for the obligations contracted by the captain if the latter
exceeds his powers and privileges inherent in his position of those which may have been
conferred upon him by the former. However, if the amount claimed were made use of for the
benefit of the vessel, the ship owner or ship agent is liable.
1. 10. Doctrine of Limited Liability – liability of shipowners is limited to amount of interest in said
vessel because of the real and hypothecary nature of maritime law such that where the vessel is
entirely lost, the obligation is extinguished.
Exceptions: (1) vessel is not abandoned

(2) claims under workmen’s compensation

(3) injury/damage due to shipowner’s fault

(4) vessel is insured

 The doctrine also applies for claims due to death or injuries to passengers, aside from claims for
goods.
 In abandoning the vessel, there is no procedure to be followed. There is neither a prescriptive
period within which the ship owner can make the abandonment. He may do so for so long as he
is not estopped from invoking the same or do acts inconsistent with abandonment.
1. 11. Roles of the Captain:
1. a. general agent of the ship owner
2. b. technical director of the vessels
3. c. represents the government of the country under whose flag he navigates
1. 12. Loan on Bottomry – made by shipowner/ship agent guaranteed by vessel itself, repayable
upon arrival at destination
1. 13. Loan In Respondentia – taken on security of the cargo repayable upon the safe arrival at
cargo destination
1. 14. Accidents and Damages in Maritime Commerce:
1. a. Averages
2. b. Arrivals Under Stress
3. c. Collisions
4. d. Shipwrecks
1. 15. Average:
1. a. all extraordinary or accidental expenses which may be incurred during the voyage
for the preservation of the vessel or cargo or both
2. b. all damages or deterioration which the vessel may suffer from the time it puts to
sea at the port of departure until it casts anchor at the port of destination, and those
suffered by the merchandise from the time they are loaded in the port of shipment until
they are unloaded in the port of their consignment
1. 16. Simple Average – expenses/damages caused to the vessel/cargo not inured to common
benefit and profit of all the persons interested in the vessel and her cargo; borne by respective
owners
1. 17. General Average – expenses/damages deliberately caused in order to save the vessel, its
cargo or both from a real and known risk

Requisites:

1. a. deliberately incurred
2. b. intended to save vessel and cargo or both
3. c. from real and known risk
 4. d. there is success
1. 18. Formalities for Incurring Gross Average:
1. a. there must be an assembly of the sailing mate and other officers with the captain
including those with interests in the cargo
2. b. there must be a resolution of the captain
3. c. the resolution shall be entered in the log book, with the reasons and motives and
the votes for and against the resolution
4. d. the minutes shall be signed by the parties
5. e. within 24 hours upon arrival at the first port the captain makes, he shall deliver
one copy of these minutes to the maritime judicial authority thereat
1. 19. Arrivals under Stress – arrival of the vessel at a port not of destination on account of (a)
lack of provisions; (b) well-founded fear of seizure; (c) by reason of accident of the sea disabling
it to navigate

When Not Lawful:

1. a. lack of provisions due to negligence to carry according to usage and customs

2. b. risk of enemy not well known or manifest
3. c. defect of vessel due to improper repair
4. d. malice, negligence, lack of foresight or skill of captain
1. 20. Collision – impact of 2 vessels both of which are moving
1. 21. Allision – striking of a moving vessel against one that is stationary
1. 22. Cases of Collision:
1. a. due to the fault, negligence or lack of skill of the captain, sailing mate or the
complement of the vessel – ship owner liable for the losses and damages (Culpable Fault)
2. b. due to fortuitous event or force majeure – each vessel and its cargo shall bear its
own damages (Fortuitous)
3. c. it cannot be determined which of the 2 vessels caused the collision – each vessel
shall suffer its own damages, and both shall be solidarily responsible for the losses and
damages occasioned to their cargoes (Inscrutable Fault)
1. 23. Error in Extremis – sudden movement made by a faultless vessel during the 3 rd zone of
collision with another vessel which is at fault, even if the said movement is wrong, no
responsibility will fall on said vessel
1. 24. Shipwreck – denotes all types of loss/ wreck of a vessel at sea either by being swallowed up
by the waves, by running against another vessel or thing at sea or on coast where the vessel is
rendered incapable of navigation
1. 25. Salvage – the compensation allowed to persons by whose voluntary assistance a ship at sea
or her cargo or both have been saved in whole or in part from an impending peril, or such
property recovered from actual peril or loss, in cases of shipwrecks, derelict or recapture; a
service which one person renders to the owner of a ship or goods by his own labor, preserving
the goods or ship which the owner or those entrusted with the care of them either abandoned in
distress at sea or are unable to protect and secure; a permit is required to engage in the salvage
business
 1. 26. Derelict – a ship or cargo which is abandoned and deserted at sea by those who are in
charge of it, without any hope of recovering it, or without any intention of returning it
1. 27. Elements of a Valid Salvage:
1. a. a marine peril
2. b. service voluntarily rendered when not required as an existing duty or from special
contract
3. c. success, in whole or in part, or that the services rendered contributed to such
success
1. 28. Contract of Towage – contract whereby a vessel usually motorized pulls another from one
place to another for compensation. It is a contract of services.
1. 29. Difference between Towage and Salvage:

Salvage Towage

crew of the towing ship does not have any

crew of salvaging ship is entitled to salvage, and interest or rights with the remuneration
can look to the salvaged vessel for its share pursuant to the contract

salvor takes possession and may retain tower has no possessory lien; only an action for
possession until he is paid recovery of sum of money

court has power to reduce the amount of court has no power to change amount in towage
remuneration if unconscionable even if unconscionable

Carriage of Goods by Sea Act

1. 1. When Applicable:
1.a. contracts for the carriage of goods
2.b. by sea
3.c. to and from Philippine ports
4.d. in foreign trade
1. 2. Notice of Loss or damage must be given in writing to the carrier or his agent at the port of
discharge or at the time of the removal of the goods into the custody of the person entitled to
delivery. If the loss or damage is not apparent, the notice must be given within 3 days of
delivery. However, the carrier shall be discharged from all liability in respect of loss or damage
of goods unless suit is brought within 1 year after delivery of the goods or the date when the
goods should have been delivered. Notice of loss, if not given, that fact shall not affect or
prejudice the right of the shipper to bring suit within the 1 year prescriptive period.
Warsaw Convention
1. 1. When Applicable:
1. a. international transport by air
2. b. transport of persons, baggage, or goods
1. 2. Liabilities under the Convention:
1. a. damage sustained in the event of the death or wounding of a passenger taking
place on board the aircraft or in the course of any of the operations of embarking or
disembarking
2. b. loss or damage to any check baggage or goods sustained during the transport by air
3. c. delay in the transport by air of passengers, baggage, or goods
  Enumeration of causes of action as above stated is not an exclusive list. (Northwest Airlines vs.
Cancer)
1. 3. Meaning of Transport by Air – period during which the baggage or goods are in charge of
the carrier, whether in an airport or on board an aircraft, or in the case of landing outside an
airport, in any place whatsoever
1. 4. Action for damages must be brought at the option of the plaintiff, either:
1. a. before the court of the domicile of the carrier;
2. b. court of principal place of business of carrier;
3. c. court where he has a place of business through which the contract has been made;
4. d. before the court at the place of destination
1. 5. Convention provides for a limitation of liability:
1. a. for each passenger – limited to 125,000 francs
2. b. for goods and checked in baggage – limited to 250 francs per kilogram
3. c. for hand carry – limited to 5,000 francs per passenger
 When can you not avail of this limitation?

(1) willful misconduct

(2) default amounting to willful misconduct

(3) accepting passengers without ticket

(4) accepting goods without airway bill or baggage without baggage chec

1. 6. The right to damages shall be extinguished if an action is not brought within 2 years from
the date of arrival at the destination, or from the date on which the aircraft ought to have
arrived, or from the date on which the transportation stopped.
1. 7. Notice requirement: damage to baggage : within 3 days from receipt

damage to goods: within 7 days from receipt

delay: within 21 days from receipt

 Failure to file written notice, no action shall lie against the carrier, save in the case of fraud on
his part.
1. 8. Notice Requirements:

COGSA Code of Commerce Warsaw Convention

protest at time of protest at time of

loss/damage apparent receipt of goods receipt of goods

loss/damage not protest within 3 days protest within 24

apparent from delivery hours after receipt

protest within 3 days

damage of baggage from receipt
 within 7 days from
damage of goods receipt

within 21 days from

delay receipt

Public Service Act

1. 1. Every person that may own, operate, manage, control in the Philippines, for
hire/compensation with general/limited clientele whether permanent, occasional, accidental,
and done for a general business purpose any common carrier, shipyard, electric light, heat and
power and public utility.
1. 2. Public Utility – business or service engaged in regularly supplying the public with some
commodity or service of public consequence such as electricity, gas, water, transportation,
telephone or telegraph service.
1. 3. Prior Operator Rule – before permitting a new operator to invade the territory of another
already established, the prior operator must be given an opportunity to extend its service to
meet the public needs in the matter of transportation.
1. 4. Prior Applicant Rule – presupposes a situation where two interested persons apply for a
CPC in the same community over which no person has yet been granted a CPC to operate. If
both applicants equal, then the applicant who applied first will be given the CPC.
1. 5. Distinctions between CPCs and CPCNs

Certificate of Public Convenience and

Certificate of Public Convenience Necessity

issued by the appropriate government agency to

any authorization to operate a public service a public service to which any political
issued by the appropriate government agency subdivision has granted a franchise

an authorization issued by the proper

government agency for the operation of public an authorization issued by the proper
services for which no franchise, either municipal government agency for the operation of public
or legislative is required by law services for which a franchise is required by law
1. 6. Requirements of CPC and franchise:
1. a. Filipino citizenship
2. b. financial capacity
3. c. public convenience