Professional Documents
Culture Documents
MARITIMELAW
CHAPTER6
GENERALCONCEPTS
I
A. NATUREAilD RATIONALE.
t
3
The supreme court explained in one case that the spirit of the code of
i Commerceia accurately set forth in gltreat,iseof Madriaga on maritime law:t
t
'That,which dintingtliahes
the maritimtrfrom the civil law and even
I
I
lionr thc nrercantilelaw in genemlis the real undhypolhecary natureof the
andthe manysecuriticsof a real naturethat rnsritimecusfomsfrom
f
Il f,ormer,
tirne immemorial,the }aws,the c$des,ortd the lahr jurieprudence,have
!
t
t
t tFrancieco,p. 254.
,Philippine shipping company",el aJ. v. F ranciscoGarcia Vergara,No. 1600,June l, 1906,6
i* Phil.28r.
* ,l l9
I
t
1M NOTESANDCASESONTI{E.IAWONTRANSFORTATION
-
Ar,rDPUBUCUnurres
provided for the pnotection
ofthe
various aud connicting intereat
venturedand in naril;;-ery.did;";,;ffiil which are
veaeeland 'isked rhoJ;il: inrereetsof the shicb
{e" Tr"r, o*.*qor *r" .rgo andconeigneea,
*t q* "p""iie carso, u,*"oi ecir
ttrJ,:L'*?ffiH';F;*;l
conrtrnctor ae to repdir: made
their wagea, una1l,""u or
to d;#r:
"
"As evidence of tftis "reat" nature
rirnitaoooot3:-lt:o{'P,qtil of the maritime law we have (l)
the
frll" totheach;-""r"llr*," vegs€l
the freistt m,o,lev,and.(zrtfr"-ridil aad
de0entionof the vesser lgrrin tls lhe emba"goand
o-i*'_ rl:ry ""rs;;
etow morethan a.peruonar "tunaction s" ordinary civ' raw wourdnot
againstthe
bsobsorv€d tr,"tthl*ientJ debtoro, p".*r, liabre.It will ngE!
aS.nrcalrerempth'noeet*onr "*.ffir1u";; ;;;;;";.j; t, u"""r*,rrn" whicb
money'thug avoidingthe uruirityry
"i*'a-"ri"u,iit"*, andFeight
buaineea' eoseitili;voi ,i"kirrg rri.'*r,"i"" fortunein the
r'*.*T,:" il;tffi#lime lbg
ttreveaser ib.qF seculne c.eaito,-"v ror.iv nea'onanach
tri" ctaim-litr,""i *"ii,"J?#"?*r"_ent
rights by a final j.W""t, of his
prejudice of a thjrd person.
"";;;rh"
*n"*ft'1tr#tT:#S,$J;:l y e;te3t
th.t,incertain
caees,
rJ"i.,i,,""i,
nffill"|ff,""""i ;"rTfi#;ffifi:,fffi:$ilT
h:,tgf H#c!i'ftlsrffi g::J:fi#:i{{tj*::il",:,tr
and
carso
notclaim
;ilu1fti;1,,fi*:l:ffj r*"
"ri*,#.ishis",,Joi
tlhere
privi,egee,*#"illfil.lXltiil{;nru:,:f
8re twn Eoo^h- -,L-- :. ,
:"H;:l#li,lffi
.
rea' naturcof
* pg rrr, *aJirr,1e'au;fi;##ch
ofttrepartie"t:iilH theriab'*v
;;,h';;
asentieonlylialte withrheveGt ;ry+ y at merc!ofthewavee. rf the
thtougttt'e aeidents oln"igati;ilia Li a"igr,,Jr;;-,;;;"* ,,,r, belost
onlyju* that the maritime creditor
H':ffi ;il""ffi:t-ffif Hr*lTtil:urnarunorhicrishtar,ydetainins
tacit or legal,which may exist
or*t',#j"|;en'e' which a upo* the veseeland
thg,g
exisu*T;;"",11HSH *:ry* - inarrdition
! f ""a.u*gi,.
flTbd* ;;orA *,"r"*,-Ji|;ffJ'#,ffiS* ff :h';;:*lff
charger' the wageeof the
crew earn;rr;.,
the ragt voyage
articre646'of tn:-g-Tr ae provided in
"rc.--"t"r,1du"r" dueeunder-arricre
indemniricationdue kr-the g42,the
terminatedon aceorrnr the veeeerin casehis contract
"up;;;i
nr tne vol,intarj r"r,, orn"rr,iu ir
,reolvencyof
:|fi*"#;ilj":Hft1 ;3i*f ,#, andorher
r'"uiiru", from
",raing
""i'rr,"
,.,.,
.*;1?Jl'n;T::'tr,:;ru?fi:,; anrr
sflffilffit1i:!.1'* r.ifi,
A,.,,r'rnc,,
c,rporarion,
MAITITIMH IAlf {:n
[isnsrcl Conc*pta
-and*
'1'
fiie owner of a aea-goingahip may rimit his riability in aeosrdanao
!*'ilh Article 3 of thir Convention in reepect sf gl6img arieiry
fom any of the
following occrurences, unlees the occurrence giving ri6e to
the clain reoulted
from the actual fault or privity df the owner;
ta) loes Me of, or pereonal injury to, aay perron being earrid
9f
in the ehip, and loes of, or dnmage to, any propcrty on board
the rhip.
(b) loas-of life of, or personal
injury to, aay other pereoa,
whether on lond or on water, Ioeeof or damage t o'tl.,e,jmperry or
infringement of any righte caused by t^he "oy
o*gi*t or iefaurt t&e
owner is responaible for, or any p€r$on not on".t,boarJ the
ahip for whose
act, neglect or default the owner io reeponrible:prouidcd,, I
holnuenT]hat
in regard to the act, neglect or default of thie laet class perron,
owner ahall only be entitted to lirrit his riability when tbo
of the $
I
aa, neglect
or default i.sone which occurs in the navigation or the rnanagpnent i
of
the ship or in the loading, carriage or driharge of ita '
ffor in the t
embarkation, carriage or diaembarkation of its paeeeryerrl
422 NOTE$ANn O.ltrCnS
ON ?HE LAw oN'IltAtis^I'{.rt(Ih,lloN
AND PUBI.JCUTruNNS
B. STATUTORYPROVISIONS.
The statuLory provisions that provide for the limited liability rule are
.
Articles 587,590,643 and E3T of the Code of Commerce rvhich provide
as follows:
AnrrcLE 587. The ship agent shall elso be civilly liabre for the
indemnities in favor of third persons which -ry from the
conduct oftho captrin in tho eero oftho gn'dr whlch""i"* ho l*aded on
the veceol; but be Inay oxempt himeelf therefrom by abandoning the
vess€l with all her equipments and the freight it rnay have earned
during the vo.yage.
AR'ncLu. 5tX).The co-own€re of the vesaerlshalr tre civi[y tiarrle
in the proportion of their contribution to the common fund for the
resulta of the acts of the captain, referred to in Articre 5g?.
' Each co'owner msy erempt hiraself from thi* riabirity by the
absndo;nment, before a norary, of that part of the vessel belonging
to him.
Aft'l'ICl"li {l'llt. If thr: vefaol .8nd her crrgo nhoukl lx. totally leret,
by roanon of capturt or wreck, alt rlghtr $h&ll bt t:xfingrrinh6cl,}oth
ae rugnrde thtr cr*w to demund any wlger whntnocver, and au regarde
the ahip agent to recover the advancec mnde.
rf a portion of the vesset or of the cargo, or 'f both, shourd be
eaved, the crew engaged on wagea, inctuding the capthin, ehall retain
d
their rights on the ealvage, eo far ae they go, on the remainder of the
vess€l ar well as on the nmount of ths freightage of lhe cargo ravod; a
but crllo*r wh. aro engaged on shsrea ghail not have any right t,
wbstso€ver on the salvage of tho hull, but only on the portion of the
frelghtage eaved. If they ehould have worked to- recoyer the
remainder of the ehipwnecked veesel they shall.be given ftom the
amount of the ealvage an award in proportion of the efforts made
gnd to the rieks, encountered in orrler to accomplieh
the ealvage.
ARTTCLE. 8{lz. The civil liability ineurred by the ehipownere
in ths cases preecribed in thir rection,ehall b€ understood as lirnited
to the vdue of the vesi€l with all her appurtonances and height
earrred during the voyage.
MARITliliE LA,I,V d23
C'eneralLloncr:ptr
C. COVERAGE
Article 837 applies the principle of limited liability in cae€sof collision
while Articles 587 and 590 emtxxly the univercal principle of limi64 Uability in
all cas€s.{However, it was explained in Aboitiz Shipping Coryoration u.C*ncrcl
Accident Fire and Life AssuronceCorporation Ltd.5 that taken together with
related articles, Articles 83?, 58? and 590 cover only: (1) liability to third
persons,{i(2) acts of the captain,? and {3) eollisions.8
In connection with Article 58?, the carrier cannot invoke Articlee 1?33
and I ?ill-rof thc Civil Code.While the pnnrary law governing the inetant caa€i8
tlrt'(livil (lodr, irr rrll mattcrn not rr:gululcdby rrricl(]rde, tho Codeof Commarce
and other special laws ehall govern. Since the Oivil Codecontains no proviEion
regulatinglinbility of rhipownersor agt:nLr in lhc eveni of total lossor deetruc"tion
of the vessel,it is the provisions of the Code of Commertn, particularlyArticle
587, thaL governs.e
The principle has not been rendered obsoleteby the advancesin modern
technologrywhich considerably lessen the risks involved in maritime trade.ro
The liupreme Court further explained in Monorch Insurance Co:,Ine u. Court
of Appeals:tI
''No veaml,no liubiliry,'expr{}see$ rn a nut*hell the timitad liability
rule. 'l'he ahipownerr'sot agent'aliability ia mcrcly cq-extensive with his
intcrest in the veaselsuchthat a total loguthereofreaultEin il,sextinction.
The total destructionof the veeoelextingrrieheernarititrle liengbecaue€there
is no longerany r?sto which it canattach.This doctrineis bassdon the resl
andh1'pothecary natureof maritimelaw whichhasite originin the prevailing
conditionsof the maritime trade and seavoyagesduring the rnedievalagea,
at.tlndedby innumerablehazardgand p'elrils. Tooffeetagainattheseadvenee i
conditirinsand to encourage shipbuildingand maritirnecommerce'it wag
deemednecea&arv to confinethe liability of the owneror agentarisingfmm
thc operulionol & nhipto l,h0vesscl,cquipnrcnt, urrdlreiglrt.or inuuranco,if
8ny.'
ln the case of Yongca us. L<,-wrnatj which invulved the steamera ss "Negms"
belonging to Yangco which after two hours of sailing fxrm Romblon to nnanita
encnuntered rough seag aB a result r.rfwhich it capsted such that many of its
passengerg died in the mishap, scveral actions fnr damageg wene filed againet
Yangco for the death nf the paest^ngr-,rnin thc flourt, of First Inatance of 6apiz.
Alter rendition of the judgment for danruges against yangco, by a veriied
pleading, he sought to abandon the vessel to the plaintiffs in the three
caees
together with all the equiprnent without prejudice to the right to appeal. The
Supreme Court in resolving the i.esue held as follows:
"In the light of all the foregoing, we therefore hold that if the ahipowner
or agent may in any way be hetd civilry liable at all for irdury to or death of
pa8sengersarising from lhe negligenceofthe captain in cagesofcollisiongor
ehipwrechs, his liability is merely co-extensiverrith his intereet in the veseel
such that a total loes thereof results in its extinction. In arziving at thie
conilusion, we have not been unmindful of the fact that the ill-fat€d stiamahip
Negme, as a vesselengagedin interisland trade, is a common carr:ier(De
villata v. stanely, gz phil. 541), and that the relaiionahip between the
petitioner and the pasaeng€rswha died in the mishap reste on a contract of
carriage. But assuming that petitioner ie liable for a breach ofcontraet of
carriage, the ercluaively 'real and hypothecary nature' of maritime law
operatea to limif auch liabfity to the value of t]re veeoel,or to the insurance
thereon, if any. In the ingta.nt caee it doee not appear that the veas€l was
ingured.
whether the abandonmentof the vesael mught by the petitioner in ttre
inetant cas€ wa8 in ac-cordaneewith law or not,*ia immaterial. Ttre vessol
having toially perished, any act of abandonment would be an idle ceremony.,
D. ,EXCEpltOlts.
Ther,e are exceptions to the limited liability rule, nnmely: (l) wb-erethe
tnjury 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;ra (2) where the
vesE€lia innursd; and (B) in workmen's compeneatjsa slairnn.rs
the High Court added another the exception thereto by-staUng that while tire
total deatruction of the veseelextinguishes a maritime lien, ae there is no longer
any risk to which it can attach, but the total destruction ofthe vesE€ldoesiot
ttr*! the liability of the owner for repairs of the veeeel completed before its
losa'The Court interpreted the provision ofArticle 591 of the Code of Conamerce
in relation with the other Articles of the same Code.
ii
MASI?IME T"AW 4?5
General Conccpts
n. Negligence.
The lim.iteeiliability rule applies il'the captain or the crew
cauged the
. damageor iqjury. Iror instance,the ehiprwner's orsbip&gen[,sriability
is limit€d
to the value of the vesselif the danragu,nu, causedby the
unseaworthineesof
the vesselcausedb.vthe negligenceoithe captain or crew
during the voyege.r?
However,if the failure to rnaintain the seaworthinessof the vesset
can be ascriH
to the shipovi'neralone or the shipowner concurrently with
the captain, then
the limited liability principlecannot be invoked.r" "
The carrier isliabre for the damage.s to the furr exfent and not up to the
vnlrrf of th0 vt'sselif it wns r'.qt$blishcd
fhrrl thc r.rrrrierwas grrilty of negligence
in allowing the captain and crew to pray mahjr:ngduring
th'evoyage,in rii[ng
to maintain thc ship aH-.{(,nwort}ry rrrrdin i,rr,,ro,il,g
tiie ship-tri,,"."y *uri
pa$setrgers than it was allowedLocarry.11,
A sintilttrcrrnclusion
wasreachedin unothercase,'whereit was estabtished
that the sinking of !he vesselwas cluetri its un,,ieaworthiness
evenat the time of
its departure lrecauseit was top heavy;an exccssive
amount .;;g;;;; i;;;
o-nd-eck,closer supervision of the part nf fhe shipowner "f
could ha-,repreventeJ
the fatal miscalculation.ac such, the shipownercannot
escapeiiability n*ogb
the expedientof filing a notice of abandonmentof the vessel
by virtue ofArf.icle
587 of the Codeof Commerce.
Fnilur0 io mnintnin the tit'tiworthirruisof the vessetwas
also one tlf the
rea8onswhy the invocationof the limited liability rule was
rejectedin another
cqnr'.2rAdrlition:lll3',it wns ll;r;r,rr,etl
in llir, ,r,,rtr".r.,*tharlauthorizing the
voyagenotwithstanding its knowledgeof a t1,pho.nis tantanrount
to negligince"
that exempts the casefrom the opeiation orin* limited
lt;tililt;;i;.'-'-"*
The caseot'Mantla steamshipc'ompany, Inc.u. InsaAbdurhaman
and Lint
Hong Tbu is a caseof colrisionof ihe ML "coir.s'er"v";;tMS *Bowline
K"o;;
as R rerult rlf which tlro M[, "(lorrlrtr,loV" t:rr;xiztrllrrrdwtts lor[
whorelnino (g)
pa'r!{ongrr$ dit'd or wert' nriesingand ull ifs cargoeswere lost. In the action
for
drmeges,.risingfrom the coilision,appryingArticrc8J? of
the cJe;ib;;*;
the court heid that in such .u"" *i"rL the collisionwas
imputable to both of
them, eachvesselshall suffer her own darnagcsand both
shall irc solidarily liable
for the damagesoccasionedto their ."rg*". rhus, the
su;;;;" court held:
"In fact,it is a generarprincipie,weil estabrished maritimelaw and
custom.that shiJrowners andshipagcnts:rrecivill.yliablefrrrtheacrsof the
r;Alirttie Shlpping
Corlxrration v. (irrreral A,ccitl+:nt l'irc nn6 l,ifc,AssuranceCorporation,
LlA., supra. :
rnMonrrclrlnrsuralrce
Oo.,inc. l: Court of App.lalx,sapra.
'!No. I 10J98,lriovember
7, LS1T, Z8l SCRA S34,S44.
mPhilippineAmerican
c'enera!Insuranceco.. Inc. v. court d'Appeals,No. 116940,June
199?,273SriRA 262,271-2i2. 11,
2 r l .1
i r J 1 : 1-iS| ;h r l p i n (r ':, r . ,
i n c .r ' .r ' o u ; . t . i f . , \ p y r a r o , . l\ i.J. or {. j 2 r , S c p r e r n b e r 2r IgJg, g , 3 r s s c R A
339,346
r:Supra.
NC)TESAND CASESONTIItr trq,w ON TRANSPORTATION
AND PUBLICUTII,ITIES
The supreme court ruled, however, that insofar as respondent I.im Hong
To, owner of M/L "consuelo v," is concerned, liability was rnotti-it*a becaug€
he w-hoadmittedly employed an rrnlicensedmaet€r and engineer and who in his
application for permission to operate expreasly aseumed full risk snd
responsibility. The Court ss.id:
*rhe international
rule is to the effectthat the right of abandonment
of veeeelu,
ae a legal limitat'lon of a shipwner's liabiliiy, doegnot apply to
caseewherethe iqiury or the averageis dueto shipowne/eownfault. Farina
(DerechocommarrcialMaritimo,vol. I, pp. lzz-Lzu, on the authority of
judicial preeedentsfrom variousnstions,eetsthe rule to be as follows:"
b. Ineuranee
?he limited liability rule does not apply to insurance claime. Thus, in
vasqucz u. court of Appealszxthe suprenne court found that while typhoon was
"an inevitable uccurrence, yet, having been kept posted on the course of the
typhoon by weather bulletins at intervale of six hours, the captain and crew
were well aware of the risk they were taking as they hopped from island to
-"'**il!t-."*"--
}1.,1,RiT'IMELAW 427
(ierreralConcepts
"(lotrnsel
f'r the appt'lrantcireArricre5gz of the codeof commerce
*hich pr.vidcs that if t.her.essr:ltogether with all her tackle and
freight
nri,rlr'.\'earned during thc'voyagear* abandonecl, the agent's}iability to th;rd
pers()nsfor tortiou.qacr-qof the captain in the care oithe goodswhich
the
ship carried is extinguishedlYsor.o r,.Laserna, TBphil. 3llOt.erticle g3?
of
tiie same code r'r'hichprovides that in casesof collision, the shipownera,
liability ir limited to the valueof the vt-q.rel with all her equipment
e'arrrr'd d.trringth. voyegetphilippine .shippingctiurpany'v.Garcia, "nJr*igr,t
6 phil.
261,r;and Article 648 of the sanrecode which prrvid". tt if the vesseland
{ r r : i g h t a r e t o t a l l y ' r o s t , t h e a g e n r ' s l i a h i r i t y f r r r w a g"te * o f t h e c r e w
is
. . x t i n g u i s h t ' d .F r ' n r t h c r * p r e n r i s * sc o u n s e l, l r a w t h e c o n c l u s i o n
o that
.t' appellant'sliahility, as owner of the rwo motor ships l6st or eunk as a result
of th. t-vphoonthar iashe.dthe island rf IlIindoro on october l, lg4l, wae
e x t i n g usi h e d
d
T'he rt'al and hypothee.ry nature t-rfthe riability of the shipor+,neror
agent embodied in the pro'isidns of the Maritime Law, Book IIi,
code of
commerce, had it8 origin in the prevairing conditionaof ihe naaritimetrade
a'd s.a voyagesduring the me<iievalages,attended by innumerable hazards
a'd perils. To offset against these adveree conditions arr{l'to enco'rage
shipbuilding and maritime comnlerceit was deemed neceooaryto confine
rhe liability of the owner or ngenr arising from the operalion of a ehip the
to
vessel,equipment, and freight, or insurance,ifany, so that ifthe shipowner
o. agcnr,aband'ned the ship, equipment anri freight, his liability was
extinguished
tlr
But the proviaions of the code of commerce invoked by appellant have
r.lS no room in the application of the w'rkmen's c.mpensation Aci which geeks
he bo rmprove, and aims at the anre.lioration of, the condition of laborem aad
rmplovct's.It in not the liability frr the dunrageor loseof the cargoor iqiury
.
t{)
taIhtd.
ESupra
r28 NOTS$AND CASESON THS T,AWON TTr$,NSI\ONTATTON
. AI{D PUBLICIJTILITIAS
wlhid
^\f"'r.lil'llMg l-{!\ 429
CreneralCtlnePts
E. ABANDONMENT.
of the vesct,l,its uppurLl.'tlurlcclr
Ab.rptl,,rrnrerrt and Lhe freightageis an
indispcnsablerequirement before lhe shigrwner or shipagent can eqioy the
of
lnnefitn thc limited liability princrplo.If the carrier does not wsnt lo abandon
the ves.*el,then he is still liable even beyond the value of the vessel.
F. PROCEDUREFORENFORCEMENT.
The Supreme Court explained inAboitiz Shipping Corporation u. Gencral
Accident Fire and Life AssursnceCorporation, Ltd.n that the "righte of a veseel
owner or agent under the Limited Liability Rule are akin to thoee of the rights
of ehareholdersto limited liability under our corporation law. Both are privilegee
glanted by statute, and while not abeolute, must be swept aside only in the
established existenceof the most compelling of reasone."The Supreme Court
stat€d, however, that "more to the point, the r:ights of parties to claim agtinnt
an agent or owner of a vessel may be compared to those of creditors againrt an
insolvent corporation whose assetsare not enough to satis$ the totality of claims
ae against it. While each individual creditor may, and in fact ehall, b€ allowed
'6 Phil281.
?149Phil. ll?
PSuprt.
{30 NOTES
AhrDcAsESONIII! r.ql oN TIL{Nsr,()}{,.r,ATrOi;
A"YDru8LIC LTNLITIUS
el54 SCRA
257 I 198?l
shipping corporation v General
,*., Accidenr F.ire and Life dssurance
corporation,
"rtflltt'z
eIbid.
slhttl.
IrAHlTl.Itti t-Aw 431
' l r , ' t r ' r r l l( ' , r t u . ' t , t :
lrR()BLF.tltS:
l. l ' a l r l , r l i s p a r a r J o n .r r d r r l r ' - l i r : t , n s r _
s l' r i p c n p t a i n o f t h e M / V l ) o n
'Iose was drunk r+.hile"irewas on dutv il-{ .iuch. und u.hilr: }lrl/ Don,Irrse was
sailing fr,nr llaniia to the Visayas. As a cunsequencethereof, the M.Ay'Don
.Ju.,L'Iirlirliitd ancitll(ir veii:iel ne;jr Corrirgrdor. ciiusrng both vessel to sink
'!'ht,
cornpletcli' ilrrd tlrrrs become total lossr:s. cargo owner of lxrth sunken
vesselssued the o*'ner of the lllrv Dtin Jose tor their l<;sses.Is the ship owner
of MrV I)orr ,Iosc liallle? l)xplain vour an.sr+r: r'.)
.l'hr.shipou'rrr,r,rf
A. No. \ { . , \ ' l ) o r r K r , s ci s n o l r . r r r g cl ri a b [ r .b e c a u s e
o f t h r , l o t i r l i r , s s , , f t h r . v t , q s c i .C e n r . r a l l y , t l r c s h i ; x r w n e r i s l i l l i l e [ r _ r tr] r e
t t | g l l g t ' t l t ' r ' i l l t h I c i t p t i r r r rr r ) c o l l r s t o l rc ; r s t , sl.l 0 w t , v e r ,t l l r l i r r b i l i t y i s l i m i k ' d
to the value of thr,' vessel. ln other words, the civil liability for collision is
merell c<.r-existcrrl with his interest in thc l.essc-,|;since there was lolal loes,
his liabilit-v is also extinguished. r l9?8)
be gu'tv t or negrigence
ll-{l ia
pasgengervessel .k"rr.ire !i{ nor make cerraie rhst rhe
not overloadedand he failed
belteon boardthe veesel.0gS9) to p-*a_ sulfisient life
0,.*o""lT;;t'!i,,:j:1ff
Hr#H*,trff
;;ffi;T"tTjf
li
collisionsand shipwrecLu"t in1iJiuttu.."".
643 and g3s' cod-eorco--",*"fH".*-1ia onr.vfor unpaidwagee(Arte.
' if the shipowneror ahipagent
knewor areexpected to knowthe overtoading,
clnnot
the'r ' ir---iir"ila
r'rv 'r"tu tiabirityrure
tx. applird.
CIASES:
t8
valueof the vesselwith all her equipment*nd all the lreight moneyearnedduring the
voyage."
-This sectionis a necessaryconsequenceofthe right to abandonthe vesselgiven to
the ohipownerin articl* 587 of the ctxle,and it is ont,of tlrr: many aup:rfluities contained
in the code.(lorenzo Benito, "l-ecciones,'352.;
"Art. 587.The ngent*hall alnot.hr:civilly lilhk' frrrlht indr,mnitierin fnvorof third
p€rsonriwhich ariee from the conduct ol tlre captrlin rn thr. care of the goodswhieh the
but he rnay exempt himself therr,rfronrLryabarrdoningthe veeselwith all
vegrelcarrie-.d,
her equipmenlsand the freight he may have earnedrluring the trip. t
"ART. 590.The part ewners of a vesselshali be cir"iliy Labie, in the proportion of
to thc cornmrir,funC,fi,r thc rcsults r.,fihr,actsof the captainreferred
iht.ir eo.ntrilrutiorr
to in article 587. Each part owner may exempt himself frnm this liability by the
ebandonment,beforea notary, of the part of the vcsselbelongingto him."
'Ihe "Exposicionde -The
motivos- of the Codeof Commercecontainsthe following:
pres€nt code { 1829t does not determine the juridical status of the agent where such
agcnt is not himself Lheowner of the vessr-'I. This onrissionis suppliud by the prripoaed
code,which providesin accordancew'ith the principles of maritime law that by agent it
ia to be underet{x}dthe personentnrsted with the provisioning of the vessel,or the one
who repreaenteher in the port in which she happerrsto be. This perconis !.heonly one
who represents the veesel- tliat ie to say, the only one who r€pre$ents the intereet of
the owner ofthe veseel.This provision has thereforeciearcd the doubt which existed as
t{, the extent ofthe liability, both nf the agent and lbr Lhe owner of.the veesel.Such
liability is limited by the proposedcode to the value of the vessel and other things
nppertainingthereto."
lrrr. ile
pasa There is no doubt that ifthe Navarra haclnot beenentirely lost, the agent, having
Cil!l(,ll held liable for the negligenceofthe captain ofthe vessei,could have abandonedher with
p. l'lre ull her equipnrcntand the freight moneyeamed tluring tlrc voyuge,thtr; hringing himeelf
n hrch within the pmvisions of the article 837 in so fir as the subsidiary civil liability is concernd.
Thir nbandonmentwhich would hnve amountt,rlto ln ofTi'rof t,lrevalue of the veesel,of
her equipnrent,and freight mone.yearned could not have becn refueed,and the agent
nri the could not have been pereonallycornpelled,under such circumslances,kl pay the 18,0,00
r t'tll of ryrson,the estinrntedvalue of the vetlselat thc t,ilnrrrl'thecollision.
,*l ,1sP4l
I'Lusis the ditTerencewhieh exisl Lretweenthe lawlul acts and lawful obligation of
the caplain and lhe liability which he incurs on accourrlof any unlawful act conrmittcd
s.irI ng by him. ln the 6rst case,the lawfrrl acte and oliligations of the captain beneficialto the
ihie for vesselmay be enforcedas againet the agent fbr the reason that such obligatinns arise
ps * ith from the contract of agency (pror.ided,however,thlt thr: captain does not gxeeedhis
lnrt'l'CC. authority), while as tr.rany liability incurrod by' thc captuin through his unlawful ac[a,
ie value the ehip agent ie simply subeidiarily civilly iiable. T'hisliability of the agent is limited t,o
P 8) the veeseland it doesnot ertend further. Fbr this rca${)nthe Codeof Commercomaket
agent liable to the extent of the value of the vessel, as to the codes of the principal
frndant maritime nntionsprovidod,$rith the vesiiel,rrndrtot inriividrrnlli.Suclrin also the npirit
t this itr of our crrde.
,ould be
st thr()$e The apirit of our code is accurafely sr,t lirrth in a treatise on mnritirrte law, fium
entirelY which we deem proper to quote the following as the basie of thie decision:
.rtent of
[See quotationaboueJ
c,'lli.ion
We accord.inglyhold that the defendant is linble for the indemnification to which
d bv the the plaintiff is entitled by r"eaeonof the collision, but he is not required to pay uuch
'd to the
,li|. NO1ESAI{D CASESON THE I"AWON TRANST'ORTATION
AND PUBLIC TXTILTTIES
indemnification of the noaaonihat the obligalion thuu incqrred haa been extinguiehed
on accoun[ of the loairof the thing bouyrdfrrr the paynrent lhereof, and in this r*epoct tlre
judgment tlf the court btlow is alfrrrred except in so far as it requires the plaintiffto pay
the costs of thig action, which is not eractly proper. After the expiration of twenty daya
let judgment be entered in accordanceherewith and ten days thereaft,er the reeord be
remanded to the Court ofl'irst Inetance for execution.So ordered"
.il.ir,'d I t i s l , r r t l a i r [ o s a y t ] r t t . n . h a . th. : r ^ l x , r . r r- t i r t l d
r r r t h r s r l r : c i t i r o lrrn o r o a c 4 u r g t e l y
r\ I I ll{' ('xl)rt'sll('8Lh0 t:ottst'nrrtt$ ol'{,lrtlr()n llr Llr.(r,lr!'t tirrrrrit rIa,a l}tr.:viowg of
t(' i,.t.V tlre writeq who
Eec'stnore in the upprllee'c case tharr dti his
cr.,ili,uguesln the cou;.
V ti:''::
,'r,iI'tr The trial court v"{ts.noc()rrlinglyright irr rrs
t.rlxrsitirn of thc lac|.s but not in it,s
appiicution of the larv' Judgment mulit, th.,rq,l',r.t,
lrc a.sit is herebjieversed, and in lieu
of the judgment appealed lrom. anot.hpr shall
lx't,ntcred here ii iauor of the plaintiff
nnd against the defendant for the sum of'1r3rt,437.91
u,ith lr:gal interest fromJuly 20,
1921, when the compraint was presented,
until payment. witt out speciar finding ae to
coets in either inetsnce, it is so ordered.
. abandoning the vesgelldth sll her equipmenis and the lieight he may have
earned during the voYage."
in
1929 (pagee 374-37$, the lihe principlo ,rf limited liability of ehipownera or' a3pnt
cancsof accidente,collisions, thipwrcckg, et{., said:
xxx
(Derocho
The yiews of these learned corilnentatora, iocludrag t'booe of Estal6n
to
Mercantil, Vol. 4, p. 259i and Supino (Derecho llfercantil, pp' 4&3-l&{), have not'hing
ba desired and nothing to be doubtcd on th€ principle. It only rcmriss to be notad thet
is
the rule of limited UaUiUty provided for in our Code of Commerw rell€(tE merely, or
buL a reetatement, imperfoct tltough it is, of the alsront univereal principlc on tho eubjtxt"
tbe
While previouely under the civil f,1 6e--oo laq the owner of a vegoel was liable to
full amaunt for d"*g* caured by the misconduct of the master, by tbe general maritine
to hY
law of rnoderu Europe, the liabiitv of the ahipowner wa6 aubsequeatly umjted
(Norrich & N. Y. Trans. co. v. wrigbi,80 u.s. 104,20 Law. ed'
interest in the vessel"
A rirnilar tirnitation wae placed by the British Parliament upon tle liability of
6s6.)
gnsiisn ahipownera through a scries of ctatutas beginning il with the Acr' st 7
-1i1
of l!-laesachusetts &nd Maine a9{_t1
C"o.S" II, chapter 15. Th; Iegialatures fotlow9d
l8r8"and iert, a"a 6nally, coisress enacted the Limited LiabilityAct of March 3, 1861,
(aoe2d R C' L' pp'
embodying moet of the p*"itio"u cont*ined in the Britieh Statutes
138?-l:i89). Section 428i1of the Rsvis€d Statutea {eec. 183, fit. 46, Code of Lawe of U' S'
A., reada:
_ ThE
"I.IABII,ITY OF OWNNR NOT TO NXCEED INTNREST'
linbilir; of tlre orynerof an;'vessel, fc,rany loec'
embezzlernent, or deetnretion,
by any person, qf any ProP€rty, gtxda, or merchandige, shipped or put on
board c,fsuch veesel,or ior any loes, dsmage, or iqiury by collision, or for any
act, mntt€r or thing, loss,damap, or forfeiture, donc, occarionod,or incuned
without the privity, or knowledge of such owner or olrlners, rhnll in Do caae
exceedthe nmount or value of the interrrst <lfsrrchowner in ruCh veseel,and
her freight then Pending."
The policy which the rule in denignedtn promntein the encoureSement
of ahipbuiltting'and invegtment in maritime commeFoe.(vide: l'{orwich & N.
Y.TYana.co.v,wrigirt,supra;TheMainv.Williame,lS2U.S'1.22i68c.J.
I^imitod
634.) And it is iD thit spirit that the Arnerican courte conrtnred the
Liability Act of Congreeswhereby the isrmunit^ieeof the Act wene applied to
claims not only for lost goodabut aleo for injuries and "loss oflife-ofpassengers,
whether arioing undei the genoral law of admirnlty, or "ndai Federel or
Srate statutss." (The City oi Columbus, 22 l-6d. 460; The Longfslloq lgd
Fed. 360; Butler v. Bostot & Savaonah flteamsbip co., q9 Law. ed. 101?;
of
craig v. continental Insurane co., 35 Law. ed. 836.) Thc supreme court g0
tne u*teu states in Norwich & N. Y. Tran8. Co. v. Wridt 80 u. s. 104'
Law. ed. 585, 6.89-690, accounting for the hietory of the principla, clinchee
our expoaition of the rupporting authoritiee:
-fhe history of the limitation of liability of ahipownerr is mlttsr of
l#ar.e in ths case of the
common knowledgs. Ths laarned opinion of Judgp
Iebecca, I Ware, ibZ-tg+,leaves liti.le to be deaired on the subi€c{. He ahowr
thst it originated in the maritime law of rnodern Europe; tbat shitrst the
civil, as *ull ar the common law, made drs owner reeponrible to tbs whola
or
extant of damage caused by the wrongful act or negligelco 9f tbe mestsr
crew, the maritime law only made them liable (ilparaolally fr€o e'oD blsn€)
bjcct
rirdo'
to the amount of tbeir interest i.n the ship. so that, if they suFendei€d the.
ehip, they were discbarged.
$
:!
"Grotius, in hie law ofwar and peace,says that men would be deterred
from investing in ships if they thereby incurred the apprehensionof
being
rendered liable to an indefinitc arnount b"yt.he acts nf the master
and,
therefore,in llolland, thel,had neverobst,n'r'dthe lkurian Law on that
subject,
but had a regulationthat the:hip ownerssirlr;lrl br: lxlund no farther than
lhe valuc of therirship ancllreight. Ilis worclsiirc: lVaur.sel eorum
euerctn
n c u i s u n l , " t h e s h i p a n d g r x d s t h t r r . i n ' l l r r t h i , i s s p r : a k i n go f t h e o w n e r , s
in{.erert;and this',nr.rto thr,qrrtr1o, is thr' {iligrrt.r.[l{1r(-.r,n, and in thqt sensehe
is undersk)odby the commentqtors.Borrlay lraty, l)roit Maritime, tit.
J, sec.
I' p. 276 Book ltr' c. xI, scc. XIII. Thc maririme iaw, as codified
in the
celebratedFrench ordonance de la Marine, in r6gr, expressedthe
'The proprietors rule thug;
of vesselsshall be respon.sible for the acts of the master,but
they shall be dischargedb-vabancroningthe ship and freight.'varin,
in his
commentary on this passage,lib Z, tit. g, art. 2, after specifying
certain
engagementsof the master which are binding r.rnlhe onun"r*,without
any
linrit of rcsprtnsibilitl', such rrscoltrnr:ls firr thr lx:rr*fit 9f the vgsnel,madc
during the voyageiexeeptcontractsof bottomry) says:'with theseexeeptions
it iajuet that the owner ghotrldnot lxr txrrrntlfirr t.hcncts of the mnate
r, except
to the umount of the ship und frright. ()thtrwist. lrr: would run the
risk of
being ruined by the bad faith or n.gligence of his captain,
and the
appreheneionof this would bc fatal to thtr intcrestsof navigation.lt quitc
is
sufRcientthat he be exposedto the lossot'his ship a'd of the freight,
to make
it his interest, independently ofany goodshe may haoe nn board
to s€lecta
reliable captain.' Pardessus oays: 'The o*n", is bound civilly
for all
delinquenciescommitted by the captain within the scopeof his authority,
but he may dischargehimself therefrom by abandoningtire ship and
freighi;
and, if they are lost, ir sufficesfor his discharge,to surrenderail
claims in
respectof the ship and ils freight,'suchas insurancc,etc.I)roit
Commercial.
p a r t l i , t i t . 2 , c . 3 , s e c .2 .
"Th{i sanle generai croctrinr.islrii<idtrwn iry many other writers
on
maritime law.So that it is evidentthat, by this r:rw,lhc owner'sliabirity
was
coextensivewith his interest in the vesserand its freight, and ceased
by his
- abandonmentand eurrender of these to the parties sustaining loss."
In the light +rfall the foregoing,we therefore hold that if the shipowner
or agent
may in sny qray be held civilly liable at all for injury to or death paseengera
of aneing
from 'the negligence of the captain in cases of colhslons or shipwrecks,
t is tiaUitity ii
merely co'extensive with his interest in the vessel such that a total loge
thereof resultg
in ite extinction. In arriving at thie conclusion,we have not been unminclful
of the fact
that the ill-fated steamship Negms, ag a vesselengagedin interieland
trade, ie a cornmon c
carrier (De villata v. stanely, g2 phil., b41l, and that the relationship
between the u
petitioner and the Passengerswho died in the rnishap rescs
on a contract ofcarriage. d
But aesuming that petitioner is liable for a breach of contract ofcarriage,
the exclusivily
"real and hypothecary natuten df maritime law operates to Umit such
liability to the tt
value ofthe vessel,or to the insurance thereon, ifany.
In the instant case it.do€s not appear that the vessel was insured.
Whether the abandonmenl of the veesel sought by the petitioner in the
instant tl
caeewae in accordancewith law or not, is immaterial. The vesselhavingtotally perished,
any act of ahnndonrn*ntwould tx, trrritllc c(,r(!frro,l,1.. *
H
-.qf.
Judgment i:; reversetl ,ultl p+,tiIiurrrr is llr.t.ul)\ .rl,sc,lvcdr,l' all the cornplaints,
without costs.
lThc trial courl rettdered a rlecision findirtg that LS('O "(:(11'ite'u.as solely to blnme for
the collision. The follou'ing is.sue.su'ere presentrrl ht:fire lht: srtprenrc court.l
'l'lt('r't'sl)()llrli'lltb
$ ( ' f 1 ' r t ' r l u i r r . t lt i ) c u n l n l ( . r r t( l r r . r r . t rirr r r r ti t l t t . r s a i d c o m m e n t w a e
subnritted petitioners subnrillcd a rcpl-1,Lhr.rt,krto r.r'hichlhl rcspondcnLs hled a rejoinder.
,'l on Nnvember 28, 1g83, the court gave due c(,urse to the petition for review and
ll
considered the rt,spondente'comment thort,t.6ns llrr.Answr.r. The pnrtiel were required
lo file their briefs. tsolh p&dieg having filed their lrriclh the caee ie now submitted for
decinion.
i.
lThe trial (('ur! rul('(l tn f(rt (,r t.t!'tht,plrttttltlIttntl rrrtt,rrtl the ,!eft,nt!arftsto pay damages.
On up|xal, rtsltttnrltnl .'\tpt'llatt o,rttrl rulcr! ttt tltt, tttrttrrrryu,lrcn il
applitd. Arttcle Sg7
h, of the code of contmerce unrJ the croctrine inyartgc, r. L.s,irra /7,7ph;[.
fio Irg4Il) and
It'r heltl that prirttlr ri,spttwlt,nts,ltahility. os shiSxttt,n,,r::, 7fip ltss of
{rt7 thr,cttrgo is nrerely
ut'exlensiL'eutith their interest in tht uesselsuch that o total toss
ihereaf iesults in iis
ettinrtian-Tht supreme court affirnted the c.urt rtf Apsxn|s decisirtn,!.
O,l
It)
xxx
(\r
'lhe
fi.r ba.qicissue fbr resolution is w.hr,,thr:r()r n()t respondent Appellate
Court erred
in applying Lhe doctrine of limited liability under Article dgi of thu
iode of Co*merce ag
explounded in Y\ngt'o u. L<tserna, r;upr(r.
nrl
)r;s rlrtre lc litt? of tlrc (iodt, of ( jonrrrrr.rcrpruvrdcs:
xxx
ht'
The term "shipagent" aB used in the foregoing provision is broad
liot - enough to include
the shipowner (St:rndard Oit Co. v. Inpez (jastelo, ai t,t,,t. ?56
lll r llgllJ). pureuant to gaid
piuvirit'tt, l')tut'e
fore, b"th tlrtr ship.rwner anci shipag*nt ure cirilly and
direclly liable for
the indenrnities in favor of third persona, which may arise frorn thl
conduct of the capts.itr
:na in the care of goods transported, as well as for the safety of passengerg
transported
rbl.v tYrlqco Laserna, suprq: Manila sfeamnhip c'., Inc. v. AMuriram
-v an, et or., r00 phil.
to[ 32[956]).
cof
Ilclwfver' under the same Article, this rlirr.ct hability ig moderated
and limited by
the ehipagent'eor shipowner'eright of abandonment of ihe veeeeland earned
'lhie expreseea froighi.
the univereal principle of limired liability under rnaritime law' The
Jost
fundamental effect of abandonment ie the cessationof the responsibility .f
tlr" rfriprg"iy
owner(swiLzerlandGeneratIncurance co., Ltcl. r,.Ramirez, L-+szu,r,el*ary
zi, i"sao,
96 scRA 297). lt has thus been held rhat by necessaryimplication, the shijagent,s
or
ehipowner'sliability is confined to that which he is entitled as of right
'the veeselwith to abandon -
r!on all her equipm-entand the freiglrt it may haveearnediu"ing the voyage,"
4lll+, and "to the insurlnce th-ere<lfif any" (ynngco v. l,arernu, supro).In other *o.du,ihu
/at€ ehripowner's or agent'sliability ie merely co-extensivewith hin interest in the veneel
such
tlrnt a krtal lonntht'rcof rtsrtll,rrin il.r crlinction 'N. vr,rscl,n. lilrtrility'-;p.;;;;
i;;
nutlholl Lht Inritrrtl linbilitv rule. Thc total tlestnrclionof the velu{clextinguiehea
meritime
Itcnn-nstlrtre in tto lottgerlln.yra.st0 which it can nitach (tinvt, Insular
Maritime Co.v,
ktnr, T h e l n e u L r rM a r i t i n r e , 4 bp h i l . g 0 5 ,S { J ?[ l g 2 4 i . r .
trltlIl
442 NT}TE!iAND CA$E$ON TH}: t.AWON TITANIIFORfATION
ANI} I'UBLIC UTILITIES
' In other words,the primary law is thc Civil Crirlr{Arts. 1732-1?66)and in default
thereof, the Codeof Commerceand other special laws are applied. Since the Civil Code
containe no pm\risiongregulating liabilit.y of shipog'nergor agentein the event of tatal
t'
loes or deetruction of the vessel, il is lhe prcvisions of lhe Code of Commerce,more
l{j
particuiarly Articie 587, that govern in this case.
This petition for revierv on certiarari seeksto set aside the decieion of the Court of
Appeals in CA-G.R.No. 58118-R afifrrmingthe decisionin Civil CaeeN9. 74J98 of the
then court of First Instance (now Regionar rriar court), Branch xJ, Manila which
diemiesedthe petitioners'claim for damager*against CompaniaMaritirna for the injury
MAHJ'ilut.:I-\vl 4{tt
( i r , l r r " r l r(iL r r c r . I r t r
l " or r l r r l d r . r r t h o l t t r r , v r r ' h r n r r r s n r t s r r l t o l
[ l r t . r l r r k r r r t ] i i f .l l ; V Mrrrdoro on Novembcr 4,
'fhr,
t . r i ; t i r , r r r r r l{. i r r r r r r il l l l t r r r t r . r . i i r . r r l l ; r t ! . .
l . r 1 , , .. 1 1l., , l l o u , . q
-'llll5
l$ac()ttlplalntorigrilitll.l'lilr,,iorrotLrrl,r.rl.l
, tl,rjrjrp. l"rec.)a'd
. t t n ( , n { l r . ( io n ( ) c ' o b c r ? . 1 , l g i i ' r p . l { i
rrc.; lr,} !irl irrir.s rrf l)clrrs santos and
trtlrers 's pauper litigants agdinst
t h e t - . ( , , : . ' p l l r r l a. \ l a r . r t i n r a , f " . d ; ; ; ; ; ;
t<'rthe death of sever_ar
po*r".,go., a$ a r.rlil! of thc.ri'kirig ofitre vessel
defcndant,rhe Il,V,llindoro', on Novenrber{, l96?. of
" M a u r i c i o d e l o s S a n t o s d e c l a r e dt h a t o n
NovemberZ, 1g62,he
accompaniedhis c.rnrnr:n-lawwife, :{nrprrrodel.s
santos, .rrira"".,
namely:Rnrne.,Josie,Herna.i, who was l0 ""iiyears old,
-vearsuld, eb.ff a,
l'{aria Lemia, b years gl{ ga N{e!any.5 rnonths old,
to pier g, North Harbor,
b.ar<].the
M/V,Ntrindor,,'lu,und
forAklan. rr ;ppu;;;tl,arAmparo
llf:ll-ry
(r('rr)d
l\iilrrrrs:rrrrJ
tlrr:afirn.riairJ
childrlrr brouglrtll! tlrt,irl*iongings,including
hounr.'lrrld ut*''sirn varuednt pr,O{x).il),wit}r t.hr,rrrr,t,nti.'"firdnx
in Aklan
ltr.rltrrrrrr,rrllv
H s l l r t . l r l y s t a t c d ,t l r c t x r : r tt n l t L v l l l ) ( i l r n , W c l r n i r r g , r r n d
duc to thr.
Etrongwavesit n*'k causirg thc drun''i'g'r-r'urry
por*.,r,gora amongwhom
were Ampar' delos sanbs and alr the aforesaid
.t.,ita..,i. ll a-ppearsal"o
tlrat Teresa parnatian and Diego salinr, who were
p*rJigurs areo
drowned. Plaintiff Ruben Reyeaiun nn* of the survivors. "rro
"The plainuiffs preaentedthe birth
and death certificates of Amparo
d e l n s. S a n k ras n d t h e e h j l d r e nt l l x h n . I , l _ l , J , . I - l ,
K, K,l, L, l,_l,O kr S, pp.
lfl{} trr lt)"1|cc') 'llrrytlao proactttetlcopics,l'thc
rnunifeet of paseengera of
tho MiV 'Mindoro'on NovemberZ, tgei r nxhs B
& C, pp. 16.3to 16l rec.).
"filiaclora orisostomo de Jusfo, one of the
su.rivors, corrobora0edthe
testimony of Mauricio delossantos that he acc'nrpanied
Amparo deloesantos
and her children to tlre port to board $e Irw Mindoro.
she is a couein of
Amparo delossantne'hrrshancrAecnrdingto h*_,r, whcrron* rroriauarhe aeeo'd
deck ofthe vessel,she aaw about 200 perJonetherein.
she tried to seewhether
she c€uld be accommodatedrn the thirct deck or first
deck becaueethe eecond
deck
,wae very crowded. she admitted that she was not incruded in the
manifeet becauaeshe boarded rhe hrar wir.hour ri"k-;;;;;J!"ur.rrru"a
one in tho veueel.she teot^ifrecr further that the Lroar "
was nol"able ti reach its
deetination due to its einking. During the ryphoon
,batsi., before the veseel sunk,
ehe was able lo board a
"Ruben Reyes,
_theother sun'ivor, declareclthat he paid for his ticket
before bsarding rhe M/rr' Mindoro. er ihat time he h"d ;i;h hi; perrorr.r
belongingsand cash alr in the ainount of p2,900.00.
It appeare iliat Felix
Ileyes Jakusale'r, Teresa.pamatianand Amparo
delossantos drowned during
the sinking rf the veseer.He was abreto sro,im,rnrsic)
an ierandand wae
ftOTESAND CASESOI.ITHE LAW ON TRA}{SPORTA'ITON
. AND l.rtrlllf(:IrTIt,tT'tI.;s
:l
4ERROR
e I
e
- IF! HONORABLE RESPONDEI.TTCOURT CIF APPEALS ERRED
;t IN Nor CONCENTR.ATING To {sic) THE pRovISIoN oF LAw IN
TI{E
I, NI]W CTVIL CODE AS TTKPITESSED [N:
'An.
n 1766. In all rnatters not regurated by thie code, the right€ and
ohllgationr of commoncarrierr xhalt tx, g,ru,,rr,,,ilbv thg co6o of
commorcc
and by ap+reiallawe.'
448 N()TTJ,S,IND
CASESON THD I,AWON TRANSPORTATION
AND PL'BLIC I.TTII,ITI T'S
H}TR0RII
RESP( })iDT.]IIT
COIIITT0FAI)T'F]AI,SF]ItRF:DI}i I\i()'f I.IiV$trLSING
'l'llE t)ccISt0ti (Jr'rHL L0wtrftL:ouR'i'(.)t'0lrtGtN Al-rERI."INDING
A SERIESOI' T'AI"JLTSAND
NEGLIGEN(JHA}JI) IN N()'r (}HDI]IIIN$ ITS
qg-Jr,x$p()N
DHNTCOMPAN MA'r'o l,Ay .r'lru I)AM,AOltrj
tA MARr.r'r IN
ACCOIIDANCE WITHT}TEI."AW.
ERRORIII.
T}{E HONORABLE RESPONDENT COURT O}'APPEAI,S
ERRI]D
TO NOTE,OBSERVEAND COMPREHENI]THA?ART
58? OFTHE CODE
OF COMMERCE IS ONIJ FOR THE GOODS WHICH
THE YESSEL
CARRIED AND D0 NOT II|CLUDE PERSONS."ittoilo. p. Si.
'tr i ll'
"..tIr'tttlnollxri'rutt]rrrt.]rr:wrr]rrr[]l]rrxr.rlufIlrr.typlrrxlrrortlyutnlxrut
llilr trt'
I l:0o o'cLnkthe f<rllowing morning on NovernbcrJ, l96? when the Weather
lr,rt :t,' report was tranemitteci kr him from thc Wealher llureau at which time he
. s ,r l ' r t
plotted its poaition.For in hie radiograrn3ent to c{efendant-appellee's office
. ' t ) .( ' i s
in Manila as early ae 8:07 in the morning of Novembbr3, lg6? (Exh. D) he
l i tl r t , ' d .
states in the concludingportion 'still observingweather condition.,thereby
/ i rltl
'i implicitl,vsuggestingthat he had known evenbeforedepartureof the unusual
Ll,'r)l)
weathercondition. . ." (Decision,Rollo,p. 26i
r l l i i I I ()I I
If'thl crrptrrirtkncu'of [lit: typhtxrr befrrrehand, it rs inconceivable forMarilima to
' , hu:ttrtally in tht dark of 'Welrning.'In allowing t.ht.ship to depart late from Manila
" ril;
li \ .rlI r h ' x l t i l ct l t r t . y p l t t x r trt t l v i x o r r r , xM, r r r r L i r r rrrlri H l r l r r " y lrr:rrcl ko l ' f r r r r : a i g hut n d m i n i m u m
qrrlcerll lor the ual'etyof its paesengerstaking irr0oaccount the surounding circumsta.nces
frr\ ! lt'.
We find that while MAr Mindoro was already cleared by the Bureau of Custons and the
Coast Gunrcl ftrr {lpurture nt 2:(i0 l).m. t}rr: xhip'n dr'pnrtlrr.r wlrfirhowever,delayedfor
four houra. Maritima could not accountfor thc dela-ybr:causeit ncither eheckedfrom the
n{rr $*rlt its ttpresctttative to inquire into the
callt.ain Lhe.rcasonglxrhrnd tlrr rfu,lir,r'
causeof such delay.It was due to this inl,crim that thc appcllatr court noted thgt"{i)ndeed
there is ;l great probability that unmanil'estedcargo(auchae dump truck,3 Toyotacan,
st€el bars, and 6,000 beer casesranr-ipassengers{atnut 241 more than t}re authorized
193 paesengers)were loadedduring the four {4t hour interval" (Decieion,p. 13,Rollo, p.
26t. Perchance,a closer supervisroncould have prevented the overloadjngofthe ehip'
Maritima could have directed rhe ship's captain to irnmediately depart in view of the
fact that as of I l;0? in the morning of November 2, 1967,the typhoOnhad alre;adyattained
aurf,ace*.inde of about 240 kilnmetcrs p:r hour.As lhe appellalecourt stat€d,"(vlerily,if
it were not fer this delay, the vetsel could have reached(itel deetination 8nd thereby
haye avoided the effecte of the storm" (I)ecieion, Rollo p. 26). this oonclusion wae
buttressedby evidencethat another ship, MA/ Mangaren, ao int€r ieland vessel,eailed
for New Waehington, Aklan on November 2, 1967,ahcad of M/V Mindors and took the
E&meroute ae the latter but it urri,red eafely ( Exh. llB-2, Index of Erhibits, pp. 143-l'14
and Exh. +A,ibid., p.254).
Maritima presents evidence of the seaworthy condition of the ehip prior to its
departure to prove thai it cxercised extraordinary diligence in thie caee. h/[{ Mindoro
was dry-docked for about I month. Necessaryrepaiis were made on the ahip' Life oaving
equipment and navigational inelnrmcntr were inntslled.
While indeed it is tme that all theee things were done on the veosel,Maritima,
however, could not preeent evidencc that it specilically inetelled a radar which could
heve allowed the vessel to naviga.tesafely for shelter during a Etonn'
Conaequently,the veaselwae lefb at the mercy of Welmingf in the open eeabecause
although it waa aiready in the vicinity of the Aklan river, it wae unable to enter the
mouth of eflan River to get into New Waehington, Aklan due to darkneas and the Floripon
Lighthcuee at the entrance of the Aklan River was not functioning or could not be seeD
at ail (nxn. 3-H,Inder of Exhibitn,p. 192-195;neealaoExh. 2-A, ibid.,9.160).storms
and typh@ns are not strange occurrences.In 196? alone before tllelming,'there were-
aUoui if typhoons that hit the country (Exh. M, Index of Erhibite, p. 116), the latest of
which waalyphoon Uring which occrrrredon October 20-25, which cost 80 much damage
'lilelming,' an important device
to livee and prope*ies. With the impending threat of
such as the ridar could have enabled the ship to pase through the river and to eafeW.
The foregoing clearly demonstrat€s that Maritima's lack of extraordinary diligence
coupled with th; negligence of the captain as found by the appellatc court were the
proximate caueegof tire-einking of M/V Mindoro. flence, Maritima is liable for the deaths
and iqiury of the viEtims.
l'l'ht Sultn't1r,( irur.l n.r,r.rs.tl tht rtltp<tltt!.ltrrlgrrr:trlrtrul tttk'r.lcl tho maptfunl kt pay
the heira of the uictima.l
ilt. PROTESTS.
Protest is the written statement by the master of a veeselor any authorized
officer, atteet€d by proper officer or a notary to the effect that damagee has
been suffered by the ship. P"oto"t is required under the Code of Commercein
the following cases:
I
'&use
r the
npon
8r\en
$ (lrg
est of
m'B8e
i€\'lce
iely.
{('nce
e dre
estlts
oN!
rArticle 612,
Codeof Commerce.
$Articles 612,
624 and 8.,13,Code of Commerce.
sArticle 624,
Code of Commerce.
rArticle 835,
Codeof Commerce.
i
i
CHAPTER7
VESSELS
I. GENERALCONCEPTS.
A. DEFINITTOI{S.
A vesselor watercraft is defined under presrdentiarljecree No.
4?4r as
"any barge, lighter, bulk carrier, pa'Benger ship freighter,
tanker, container
ship, fiehing boats,or other artificiar contrivance utilizing ur.ry
*o,r."" of motive
puwer, designed,used or capable of being used as n *"ir,,,
of transportation
operating either as a common contract carrier, including fishing vessels
covered
under Preside*tial 4J, except: (i) those owned *i/o. operated by
the Arnned Forcee of?T"T-{".
the Philippines and by foreign governments for military
purpose8' and (ii) bancas, sailboats and other *utu.bon*
contrivance of less
than three groustons capacity and not motorizeil." I'h,, obuu"lquoted
definition
is important-{or nurggseeof applying the laws and rtg,ulation.s
that are lxing
inrplcmcnkrtlby tlrt. Mrrri[imerIndrrsir.yAuthorit.-v.
In cttnnection
with thc provisiorrsof thc (lrx.k.ol()ornrrrr,rr:r,
tlrc Supnurnc
court had an 'ccasion to cxplain the rneaning,t'Lhe Lerr' ."vessel" yu
in con u. *
IpiI:2 t
t
"For legalpurposes,thal is, for the determinalionof the nat,ureand
effectof the relationscreat€dbetweenthe plaintiff, as owner of the $
?:
merchandiee t
ladenon eaidcraft,and of the moneythat wasdeliveredto the
m&8taElpit, and the dcferrtlantLrurrrn,ulrowrr(,ro[tllc erlrfl,lllo l$l,Ler .
wug *
t
a ue'rsel,accordingto the meaning und conxtructiongivcn tr; the wgrd vsssel D
in the Mtrcrurtrlr:code, in treating of nr:rririurtr.r,.,r,,r,r,'r,r.,,
undcr'l'itre l, tI
Book 3. i
i
The word uesselserres to designate every kincr of craft by whatever I
p a r t i c u l a r o r t e c h n i c a ln a m e i t m a y n o w h e k n o w n o r w h i c h
nautical
advancemenls nay give it iu the future, (commentariee on the code I
of
cornmerce,in the General Reviewof Legialationand Jurisprudence,founded !
by D. JoeeRers y Garcia, Vol. 2, p. 186.) t
I
I
l
rSection3tb), Decree g
Providing for the Reorganraatronul Maritrme l'unctiona in the
Philippines'Creating thc s{antirnc Indiictry Aut}rority,arrdfor ()lhr:r I
t,rrgr,r*,";srJ ib; s"". ilg';i {
R.A. No. 9295,Appendrx 8. s
!
$
4
M A R I T I M EI " A W ,t6l
V.rry.lr
A c c n r d i n gt o t h r : t ) i c i i , , r r a r yo f L r . ; 1 i s l ; r t i r lnnn ( l . J r r r i a p r u d e n cbey
Egcriche,a uesselis any kind of craft, conriideringsolely the hull.
B l a n c o , t h e c o r n m e n L a t o or n n i e r c a n t i l e l a w , i n r e f e r r i n g t o t h e
grammatical meaning oi the word 'rhip" and 'vessels,"Bay8,in hie work
aforecited, that theee terrue designat€ every kind of craft,, large or Bma.ll,
whether belongrngto the mrrchrint,nr{rrin{ior lo the navy.And refening to
lher.r.luridicalmeanilg, he adds: "'l'hia doesnlrt differ eaeentiallyfrom the
grammalical meaning;the wordn "rhip" and "vcigel'aleo deeigrrateevery
crtft, ln16r'ornnrnll,oo long nn iI lx, lrot trr rt:(cnilrryirfntrtrther,ruch t! tho
srnall boat of a ve*uel,of great€r or lees lonnage.This definition compriees
lxrth thr crlft intended firr rrcc;rnor frrr coirxlwinr navigation, as well er the
floating dtrks, mud lighters, dredges,dumpecowsor any other floating
apparatuatr.qedin the serviceof an industry nr in that uf roaritime commerc€.
. . " ( V o l .l , p . 3 8 9 . i
&.i
However, the Supreme Court clanfied in Lopez u. Duruelo!
er
'As a generalground
of demurrer rr is assignedby the defendantsthat
()Il the complaint doea not Bhow a right of action, and in the eouree of the
('{| nrlfltnrontarrbrnitte<l
with thr.dorrrru'rr.r
rrtl.r,lrl.rrrr
ir*dirr.ctodto the fnetthet
trr lhe cornplnirrt doec not allege thut a protelit had lxen presenled by tho
tr-!' plaintiff, withirr iwenty-four hours afler tlre txcurrence, to the competent
,ti$ authority at the port where the accidentrxcurred. It is accordinglyineis0ed
that, under article 835 of the Codeof Commerce,the plaintiff has ehowu no
causeofaction.
?lrr
,dssumingthat the nr[icle crfthe Codeof Commercerelied upon states
a conditionprecedentto the maintenanceof an action in a cas€where proteet
IliL' in required and that the nraking of protest rnust bc allegedin the complaint
I l'. in order to ehow I good caus€ of &ction - sn aariumptionthat in poeeibly
witlrout btsin, for thr, renxonLlrlrtlrrr:kof'prol,r,at
irr lr t:ltslrwh*ro proto*t ia
ns'ce$$ary would s€enrto rupply $l&tter ofdefense prop€r to be s€t up in the
answer,-- we neverthelees&re of t"heopinion that proteet web not necessarJ
in the cae€ now before us. I'he article in question (835, Code of Com.) in
found in the section dealing with collisions,and the context ehowathe
collisionsintended are collisionsofsea-goingveesele.Said article cannot be
applied to small boalr engagedin riven and bay traffic. The Third Book of
the Codeof Commerre, dealing with Maritime Commerre, of qfiieh the rcstion
on Collieiona forms a part, wae evidently intended to define the law relative
to merchant veeselsand marine shipping; and, aB appears hom eaid Code,
the veeseleintended in that Book are euch as are run by maatera having
epecial training, with the elaborate apparatus of crew and equipmont
indicated in the Code.The word \eeeel" (Spanish, "buque," "nave"), trsed in
the section referred to was not intended to include all ahipa, craft or floating
stmctur€s of every kind without limitation, and the provisions of that s€ction
should not be held to include minor craft engagedonly in river and bay traffEc.
Veeeelewhich are licensed to engagein maritime commerce,or commeroeby
e€a, whether in foreign or coaetwise trade, are no doubt regulated by Book
III of the Code of Co-merce. Other veeeeleof a minor nalure not engagedin
i52 Phil.229.232-235
f
tf
I
i i;.
I
s8 NOTESANT,CASESONTTIE IAW ONTRANSPORTATION
AND PI,'BLIC UTILITMS
,ii
marilimo cammerco,BuchIr rivsr boats and thoet carrying paroengem from
ahip to ehorc, mult be governe4 a* to their liabilit_v to passengers,by tbe
proviaionsof the Civil Code or other appropriate epecial;rrovirioneof lqw.
;.1
Thie conclusion is eubstantiated by the writer Estasen who makes
lh
CASE:
, .*-!i;sr&d$$s*drir*..dia;iiilkseear;@i*w,.u,
,
MAftIl'I"V}. IA\\' 455
Vcssclr
and biiy tru{hc. \"eeselewhich Bre licensedto engdgein maritime cornffierce,or commeroe
by s€a, *'hcther in foreign or coaat{.ise trade. are no doubt regulat€d by Bmk III of the
{lrxlc of Oonrmerce.Other vensglrof a minor naturr rxrt englrgedin marilimo @ilrnletuP,
auch as river boats and those carrying pe$seng€rBfrom ship trr ehore, muet be governed'
as trr their liahility to pasnengtrr,by the provisionnofth€ Civil Codeor other approPriste
special provieioneof law.
This conclusionis substantiatedb.vtherwriter Eslasen who makes commentuPon
the word "vessel"to the following effect:
"When the mercantile cdes speak of vess€ls,they refer solely and exclusively to
merchant ahipn,ar they do not include wlrr nhips.and furthermore, they almoot alwayr
refer to craft which are not eccessoryto another as is the cas€ofl&unchea, lifeboats, et '
More<iver.the merncantilelaws, in making urleof the worde ehip, veesel,boat, embarkation'
etc., rofer r.rclutively to those which nre eng;rgedin lhe tranrportation of parccngen
and foeight from one port to another or from one place to anolher; in a word, they rofer to
trrerchant vesrcls an{ in no \N,aycan they or should they tre underrtrrcd as referring to
pleasure craft, yachte, pontoons, health gervice and harbor police veneele,flOating
storehouses,warehip6 or patrol veee€ls,coast guard vessels,Fehing vessels,towboats'
and other craft deetined to other uees, such as for instance coast and geodetic survey'
thoee engaged in ecientific research and exploration, crafb engaged in the loading and
discharge,if uesselefrom same to shore or docks,or in transshipment and thoee small
crnft which in hnr|1ore,al6ng rhore, bays, irilels, covt'gnnd nnchnragesare engagedin
transfxrrttng pa$sengere Der. Mer., vol' IV, p' f95')
"nJ'b"gg"g".'(Egtasen,
ln )i, C<,,rry. lpil t41,Phil. ?70), lhis court held that I small vesselused for the
transportation of mlrchandise by sea and for the making of voyagesfrom one port to
another 6f thesc Islan<ls,equippedand victualed for this purposeby ite owner,is a ve8$el'
within the purview of the Codeof Commerce,for lhe determination ofthe characterand
efl'ectof the relations createdbetweenlhe owners of the merchandiseladen on it and its
owner.In the casebeforeus the Jison,a$ we are informed in the complaint,was propelled
hy a uecglrl-handmolor.originally used frrra traclor plow;and it had a capacityfor only
'Ihe
eight per..,,rs une to Jtrictrlt *un being put was the carrying of paseengcru-and
in I.lrr'hlrrlxrr.Thin wns not nucha boa!
l,igg,,i,,lrr.tw|r,rrtlro lllnding nt Silfiy nnrl rrlrilrr,
6* is.cr,rrt,.urplgtrtl i1 urticlc flJb ol'the Otxh. ut (.iuttttttttcc,requlrlllg protr:xtin casoof
collision.
XXX
In Yu Con u, Ipil, supra,the author ofthe opinion quotes a pasEagefrom the treatise
on Mercantile l,awby Blanco. We now have before us the latest editinn of Blanco, and we
reproduoe here, in both spanish and English, not only the passage thue quoted but also
the, ssntence immtxliately fnllnwing snid passagtl :rnd this latter part of the quotation is
tluitr: perlilre nt to t.hc point now utrrl*r cottsidt'rittitttt.
lrL.ll.. rn tircirgrammaticat
:H::hip'\nnvr:iancl'vcssel'rbuqtr*), areapplied
senge,
to <lcsignafet,very kind of craft, llrgc trr 'sln1ll, nterchant vesselsor war vegsele,a
sigrrification whicir does npt d.iffer essentially from its juridical meaning, according to
*hich uesselsfor the purposes of the Code and Regrrlat.ionsfor the organization of
the Mercantile Registry are considerednot only those engagedin navigation, whether
coastwiee<lr on the hilh seas, but also floating docks; ponbona, dredgee,scows antl
any other {loating apfaratus destined for the service of the industry or maritime
fomm(.rce.
{6€ NOINS AI{D CASESON 1I{A I.AW ON TRAN$PORTATION
AI{D PI.JBUCUTTLITIES
"Yot notwithstanding thosc prineiplec from which it would sesm t6at any {loating
lpparatut which scrves tlirectlyrfor tho traruportatron of thrrg* or perrruna which
or
indirectly ie t?letpd to ttris industry, 6r'gfrt to bc aubjected ta the principlea
of tlre Csde
witl reforence to ownenship, traneferi .lsht", regiairalion, etc., we agr,ee
witS geniro
(wSrc cil-) and it ao happens in practioe tti*t tb.yitu
not applicable to smsll sraft, which
are only eubjecd to administrative (crlstoms) reguiationr i" ttu matter of port
aervice
and in tbe fishing induat4r.,
- {e may add thajlhe word "nave" in spsnieh, which ia ueed interchangeably with
'brrque"
in the Code of Commerce, meana, according to the Spaniah-Engliailnictionary
compiledby Edwrrd R.Sennley and pubrietrodnt pirir in thc yenr l Bgq .Bhip,
,
with decks and sailg.'Particularly aigrrificant in thie definition in tht "*""J1
'deckr," aince ure oithe word
a deck is not a feature of the smallest types ,f water craft.
In thig connection a most instructive case from a Fedeial Court in the
United
staten ie that of rhe Mamie (5 Fed.,gls), wherein it was herd that only veesels
engaged
in what is-ordinarily known as maritime commerce are r*'ithin the provrsions
of law
conferring limited liability on ihe tiwner in cae€of maririme digaster. rri ti-
*"iL
opinion in that case tl'te author citeg the :analogousprovisions in the "rlf."
laws of foreign
maritime natione, eepcially the provieionsof the CommercialCodeof France;
and itls
observed that the word "veagel" in these codes is limited to ships and other
eea-going
veesele."Ita provirionnare not npplicable,"raid thercourt,,"to ves*elsin
inland norrigitinnl
yhlcb are glpecially deuigrratedby the name of boate.' Quoting frorn the !'rcnch authgr
Dufour 0 f)mit Mer. l2l), the writer of tlre opinion in the caeecited further ralz: -Ihus,
qp a general rule, it appear8to me clearly,
both by the letter and spirit ofthe law, that
the provisions of the SecondBook of the Commersial Code
fFrench I relate exclusively to
maritime and not tp fluvial navigation; and that consequentlythe word.ship,'when
it is
found in these provisions,ought to be understood in the senseof a vessefserving
the
purposeof maritime navigation or seagoingvessel,and not in the
senseof a vesseldevotcd
to the navigation ofrivers."
It is tlerefore clear that a pessengeron a boat like the Jison, in the casebefore
us,
ie.not required to make protest as a condition precedentto his right of
action for the
iqiqry suffered by him in the collieion deecribed in the complaint. ln other
wordeoarticle
835 of the Codeof Comnerce doeenot,apply.But even if said provision had becn
conEidered
applicable to the casein hand, a fair interpretation of rhe allegations of the
complaint
indicates, ive think, that the ir{uries sulfered by the plaintitrin this case were
of such a
natwe ag to excuseprotest; for, under article 836, it is provided that want
of protest
cqnnot preiudice a person not in a condition to make known
his wishes.An individual
who has sulfered a cornpoundfracture of the femur and received olher physical
injuries
;uflicient to keep him in a hospital for many monthn,cannnt be supposedto
have beenin
a-condition [o make prtrtcsl within twenty-four hours of suel, *.,u.."n.,l.
It follows l,hat
the demurrer in this casewas not well taken and ehould have beenovermled.
-In their brief in this court the attorneyg for the defendant have criticized thc
complaint for a general lack of certainty and precieion in more nrn un"i".p".i.
ii;;;;,
wl.have read the document attentively and, in our opininn, it states good
a cause of
action upon a civil liability arieing from tort under ailicles 1902 and
190"3of the Civil
Code,and our attention has not been drarn to any provision of law which would constitute
nn obatacleto the maintenanceof the action.
lVe have repeatedly called the sttention of trial courts to the general
mle that a
cas€ghould not be diamissed ou demurrer when, under any reaxonable interpreiation
of
the complaint, a cause of aetion can be made out; and the fact
that a cornplaint is
ITARI'I'ti\{g Il{W 467
Ver se,l.q
B. C O N S T R U C T I O N ,E Q U I P M E N TA N D M A N N I N G ,
The conslruction, equiprnent and manning of vessels are subject to the
rules issuetl by the Maritime Indu.s[ry Authority. This rule ie also consistent
with the provisions of Code of Commerce particularly Article 574 thereof which
provides:
C. PERSONALPROPERTY.
Vessels are personal property under Arricle 416 of the civil code. The
same nrle can be found in Article 585 of the Code of Commerce which providea:
r f J o . , { 1 5 ( ) t iI .{ a r c h
?5. lg35
F!
iil
fil
ri *i
Mortgage Law (Act No. 1508, section 2. r Indeed, it has heretofore been
accepted witlout dis&rssion that a mortgage on a veeEelie in naturc a ehsttal
mortgage(McMicking v. Banca Espaflol-l'ilipino [1909], fg Phil.429;Arroyo
v. Yu de Sane [1930j, 54 Phil. 511.). The nnly diffcrence between a ctratlel
mortgsg? of a vemel and a chettal mortgnge of tther poraeinrlity is that it ir
not, now nocersar? for a chatt€l mr.rrigageof a veds€tto be noted in the ragistry
of the regieter of deodr, but it, ie eec€ntial that a record of drruments afiecting
the titl* to n vec6{rlbe entrred in the rrcord ol tire ("lollectorof CurLomaat,tho
port of entr.v(Rubieoand Ge[to v. Rivera 11917),3?Phil. ?2;Arroyo v. Yu de
Sane,euprb.). Otherwiee a mortgage on a vesselis generally like otherchattel
mortgagesas to its requisitesand validity (58 C. J., 92.)."
ll. owr{€RSHtP.
A. ACOU|SIT|ON.
Vessels may be acquired or transferred by any means recognized by law.c
Thus, veseels may be sold, donated and may even be acquired through
prescription. Under.the present laws, vesselsthat are under the jurisdiction of
the Maritime Induatry Authority can be transferred only with notice to said
administrative agency.
a. PRESCRIPIION.
ARTICL&f78" Mcrchrnt vosscli conrtitute proporty whlch mey
be acquirod and trensfenod by auy of tho mearu nDcognizod by l,rr.
The acguieition of e veceel nuet ap;rear in a written iuetnrmenf
whlch she,ll not pnoduce rny ofiect wlth respect to third poreonr lf
not inccribed ln the rcgfutry of vees€le.
'The
ownerehip of a veesel ehall lil'ewise be acquired by
pocseasion in good fait\ continued for three years, with a jurt titla
duly recorded
In the abence of any of thee€ requisitca, continuour pfis€rcioa
for tcn years ehall be neeeesar5r i.n order to acquire ownenbip.
1 3 ?P h i t .? 2 .
'Articlt' 573, 0ode of Commerre.
!
n
$ lerlnfixnrAw {6e
b. SAIJ.
be in e forelEo
-e-olotoy, to the co-nsul of t,!re Republie of tha
Ph i I rppiaee, thorrld- thene b. oou, o", *h:ry there ie
or courr or to the rocar nuthoritv: .""., ; ;;;;
a'er tltu
court, chell order on ereninntion "rrrr*.rt, ".iu" Judge nr
of the L *"C_.
lf *ho oonrrgtloa or trra Inrunnr ""*"i1.
*h'ur* rtrrcrs ut aald por*o or
rhould hevo ilpro.€ntatrver
til"*, *r.y munt bc cii{d In ord*r
part in thrt
rho pi"..*Jr'"sx on treharfor *lr,**,u"
:|]:ff1j:k* mey bo
B. REGTSTRATION.
vesselsarenowregisteredtiuough
the.r\IaritimeIndusrryAuthority.It is
a long standingrute thai th" p;;;;io
pre''rned to be the ownerorihe * ttu*registeredownerof the vesserie
ueuseriMc,.eovJ., iilrl;il*le a ectdednrre
that the ealerrrtransferor *ru
i* n't binding'n third per'onsunreeethe
"u*o*r
ffi;:fi?T"?,:*ff,t*ua"c c',*t,*sco&st't*e
li* uu*i"
il;i#;
SE'FION 8lo- h:rv*egea coufe*ed.by
nsdrbrv" - A c*{ificatc cerrincate of ,*ltipptne
therisbt to ensesl eonrjrtcnilf;
"?Fhttip;;regietrv confera upon thc varre!
tradeandeatitrer to.lhep*i*rrt th ffi; il;ilil;;fi: coastyise
of,the Philippinss lt
of the thettrg
in pfu;il;;
eil ""tnJtTt,ird
&c high roaa, and at tho
tlnc rec.ms to it.the.eana rame
il;"r* and rubjoctl it to the r.,ns
dtnabilitiff il, undsr rhr [;;;f--tl;'i,rr*ippr-".r",
bultt vcreorr trenrfornod p*]t iJto ror"tgn-
i.r-"itt"o* 'f the ph,rpprnar.
"t;;;
(a) MARTNA RULES ON
REGTSTRATION.
I. OB.'ECTT\/E
Thiecircul&r 8e.r'e8to provides con.eoridated
t'hatehallgovernrhe regiarrauort impremenringguidolinoe
una ao.,irnenrati.nof vcg$ers to entitleit
t, the prot'ecti'n of ph'ippia" ruror
eubject torheobrigations"and to ny rh; iilrippine ftag
""J**.nrh1
o""urrrtLi"a"i *,- l"i,
"iii"-i#iuooir*.
?Martiaez v.
Martinez.
[ubiso v. Rivera, cupru.
Y
'i:
IT. COVERAGE
'Ihie
Guidelines shell Bpply ro:
TV. GENENALPROVISION
V. SPECIFIC GUTDEIJhIES
A Regieter of Vessela
1' The MARTNA ahail m"intain a registry'f veas€lsto be known
"REcIsrnR oF plllt,tpplNn vESsELc" as
w'hict*rtrnrth;pr open ro fr*e
inslxr'ii'n by the pubric_<luring regurar rrTiceh<lursn. ,"ho' ihe exigencyof
the,sarviecrrrtrt'<;uitt's.sk'lrlrrritoigixtr,rr:rlrrrll lx. ,rr,,irrili,,",li,r overntr,{
rtrttlrlotttr..strc
vt,sstls.
2 The Registerof phirippine vesserssh', c'nL.in
the foilowing
particulars in such forrn and detail as the IIIARINA
*"y pi*rrriu*,
a. Name of vessel
b. Former namesand registr-v(if appliclblcr
Type of vessel
rl. ( ' r r l l. v i g r r
(1. Official Nurnlnr
f. Material of Hull
P r i r r c i p r rDl i m c n s i o n s
h. Tonnage{Gros*NeLrDeadweightr
i. ('lassificatirin
j Spr.rxl
k. J\f;rirrongine
I Ilrrrklerr/I'lucr.of'lluilt
m. Y e a rb u i l t
. ll. Name, nationality and businessadctres.Vresidency
ofowner/
op€rator
o. Date of issuanceof Certificate or V:ssel Registry
p. Any uraterial change of condition in respect to any
of the
preccding items including recorcl.s
of encunrbrancr:s.
3' Thc registration of a veesetfor domesrictrade shail
. be effectedat its
homeport as herein defined while registration of a veriser
for trua*
shall br effectedonly at the MARTNA Central O{Iice. ""*.*u*
B" Requirements For Registration of Vessels
fr: following requirements shall have been complied
. . with prior to
registration of a veseel,if applicable:
1. Existing veesels
. a. plans approval
b. Adrneasurement
c' Presentationof phokxopi*s of'v^rid tr'ding certiricnten
2. New buildings
a. MARINA appmval to acquire vessel
b. Approval of completeplans of hull and machineries
l
f;
MARTTIMET.AW
Vce*els
c.Authorrtyigluedt'oac|rrrrli|rcation$ocietytoincpoc|/
supervis€ the constnrction.of the veseel'
\II. VALIDTTY
l.A(jertificntr.uf'V:rrgcll{egistry{CVRIghal|trevaliduntilthere
is a change in ownership or the vess€i is decommi'Eioned or conetnrctively
or.totally lost.
2.Certificateof\'esselRegistrytCVR)forvees€lsacqrriredunder
PD 760i866t171I shall be co-terminus wilh t'hecharter party'
VtI. PENALIYISANCTIONS
violatiorr ofany ofthe provisionsofthis circular ehall bc governedby
eristing lawe and regulations.
)L EFFECTNTTY
of
This Memorandum circuiar shall tre published oncein a newapaper
general circulation in the Philippines and shall teke effect on 16 october
199,{.
{&{ N(yTESAND OASESON rH}] I.r'1WON TR.4,NSI}ORTATION
,'ri.ilj i'u bltc l.r,tILil'tFi$
MARITTMST.AW dO6
Veff€lr
tv. {:t,:Nt,:ltAt,trtt{}vttil(rNsi
l. A r r . yf r r r . i g t r - r w n r . .xr lr i p l r r r r . r . l r ' irt :l l r i r r t . r * r lh y * l r h i l l p p i n e
rrutrolruirrrn.y
lrt crrlcrttl urrder!hr:l)lrrlipprrr:lL.guttr r.rlshipu uponappr<lval
b_vthe Admi nistration.
2. The registration r.ifa ship unrJera lea.se-irrevocable purchase
arrangernent shall be governed by this circular. A ship subject of a leaee-
irrev<.,cable
purchasearrangement shall be i,reatedas a bareboatchartered
ship; it shall be eonsideredan ,wnr:d ship ,nly after thr: fuil purchaeeprice
had beenpaid.
3. The documcntstion{rflrhipsrrgistt,reduntler lrll 760,ac amended
shall be governedby the provisions of this circular and chapter xv of the
1997PMlltRR.
4. Cornpaniesn'ithout owned ships which qualif-vunder Rrgulation
vI shall be allowed to acquire and register ships pursuant to pD ?60, as
amended.up to a maximum of ten i10r ship..;rvhile shipowningcompanies
have no limit as to the number of ships to be chartered.
5. Ships registered under thc Philippine flag pursuant to ttris
Memorandum circular shall be issued a certificate of philippiue Begistry
( ( l l ) l t t < : o n s i x t o nwti t h R c g r r h r t i oxnv i r 2 r i f r h r , i l x l ? f , l r i l i p p i n rM
: err:hant
Marino liulec und lkgulatiuns {l}MMltlt).
ONT}TEI,AW ONTRANSPORTATION
ffi
ffi
AND PUBLIC TITILTNES
# '
ahall be citiatn and reaidonlof tho lrhrlippinu*;
and
Ofllcor)
H
F
b.
-
Two €) principal olllccrs of the company *hall have
at leaet five (S, yeara experience.inship *unugu*urrt,
shipping
operations and/or chartering.
il 2' A ship shall be registeredunder this circular for a peri'd
.
I lessthan one (1) year.
3.
ofnot
$
$
shall be allowed fi' a g:riod n't t. exceednirrety ig0)
registration shall be under the same compan-v.
4'
days pr.vided that the
*, ,r,,rrl;rli,,.l
witli'ltegulation
*r, V.2 hereoL
ffi.
t Any.clrflr.rgt'in
rlrt'rtrrns un(lcrrn(rlt!()rrs
o[tlrc c]rartcrparty shall
*-. --
F' or,approvcdby ilre Administration.
F
$ by Filipino criw exceptin casesas may be determined
F by the Adminietration.
s'
&
For this.purpose,Filipino erew onbta.d philippine-rejstered
by prescribed shippingArticles which shalr rrciubmitted"r,ips"rratt
te
SvTed fur notation
&. by the Administration.
n
$
H
7.
-A
Philippine-registeredship may, under circumstances
dctermined by theAdminietration, haueon r"".a r,rp"-r-"r"J*
tlli tltnt shall nrt Frfiorm any rf th* funcri'nr
with the operation/manag€ment of the atup.
I'
lo be
o."ria"a
rf the,crr,w nor i'tcr{ero
n
p
r.
.
Dy an
10
All ships regietered under thjs circurar must be clasemainta.ined
-rnternahonally recognized claesification society.Any change in the
claasification of a ph-ilippine-registered ship shall
re l--ldiut"ty
corn'nunicated to the Adminietration.
11' Philippine-regrstered ships shail comply with
the requirements
of the International safety Management (IsM) code for
the erte olrutio'or
ehipe and for pollution prevention.
MARITIME L.AW 8?
Veaela
L2' companiea and ahips covered by thia circurar ahall at all time
comply rith national rulee and regulatione as well as international
conventione, codes aad standards on safety aod marioe environment
protaction.
l3' the bareboat cbarterer shall enaure that payment of the 4.6%
withholding ta-xon groes charter hire ie remiried to thi bureau of Internal
Revcnue.
,)t
14 companies with bareboatchartered ehipe nhalr depoaitin favor
of the M^ri[ime Induetry Auth'nt.y with uny rcprrkrLlt,c'nrmercia!banl
the
:IT amount equivalent to one Hundred rhousand pesos(p100,00o.00)per ebip
.li
to answer for the paynent of the 4.5t? *'ithhrrding tar, finee and penaltiee
t-\
dur' thc govern.nrentin th. event that coopany faiL to settle tbe 8€u'e upon
h, a.etg!o3 of the ship from rhe philippine Regrstry.In addition, companiee
shall algo po*t a surety bond per ship in a' amount equivarent to the carh
b.nd. Afl,e-rthe deletiei'of thc ship frorn the Philippine Registerof sbipa,
the
ernourt of (PI00,000.00)may be withcrrawnprorided thalproof of paymenr
-1,"
of nll tarea/penaltiosdrl. kl thr, govr,rnnrr.nt ,"r,u*u1of ttin regirtration
of
ll!: tlre nhip under the llhilipprnc fl'g hari l*crr subrnrt.tr:d.
shrpwning companies
, {r ehali be erempted from thig rr.qui'emcnt lor their bare]xratctrariered'ahipa.
a i,
I l r ' ,i
vI. PROCEI}UR"ES I'OR REGIS1'IIA1'IOI.i
irri, L
. -()nly applicutronrwirlr conr;rlrtl drx:urnult*lryr$,quirenlentsahall
ll', be accepted.
:L ],
by the Adminisiration.
.I l)('
3. The applicantshall pay the followrngfees:
rdt rl
a. Baretrrat ('harter - pItJ,TZ(t.(rrr
for the first three years
plus F4,000.00f<rreverl'ye&r thereafter,
b. phihppine ttegistry {CI,R)
Certificare r_rf
J hr'
,rt,l. i. Initial (good for three (jl) monlhs) * p2,000.00 for
.d.tl the first, 500 gt plus p0.U0 for every gt thereaRer or a fraction
thereof
r tht:
il\-".\ ii. Full Terrn _- p1,200.00
iii. - p1,200.00
Re-issuance
.titrltl
vlr. DOCUMENTARY REQUIRUMENTIi:
n the
. l t( ' l v 1. The fotrlowirrgdocunrentashalr txr rubrnittr:d upnn firing of an
up;rliculion:
{ l r ' l l tI a. letter of lntenh
I r ) r to l
b. Duly eigned Bareboat Charter Contract (with namee
printed below the signaturea), provided that the document
dulv
r68 NO'TESAND CASESON THE LAWON'I'I{AN$I)ORTATION
AND PUBLIC UTILI?IES
l'' 'l
yprgraphicarcorrectronsin rhe enrri*r ,r'a
. clprt eharlbe alrowed
through the ro"iasuanceof the crH, pruuiacd
trrat the original cFR being
crrrect'ed shall be surrendered wiilri. thirty
t30) days from the date of the
re-issuedCPR.
IIL SANCTIONS
XI. EFFECTIVTTT
T'histrIemorandumcircurar shail bc oncein a newspaper.f
1;urrlished
generalcirculationand shall rake effrrcr.
fificen il5i daysaftcr publication.
trtanila.Philippines22 Januan, 200J.
CASE:
oMacondray and
Company, [nc. v. Acting Commissioner of Curtoms,62 SCRA 427
tilbtd. tlgl|l.
t
t
l!
On April 10, f 915,sunsel for plaintiffs brought suit in the Court of Firat
' of t'hia city and atleg"d in tlre eomptaint Instflne
that hin cliirnts were th€ ownerr of thG pilot boat,
osn€d Valentina, which had been in bad condiLrcnaince the yesr lgl4 and,
on the dats
of tlre complaint, war strsnd€d in the place caltcd Tingioy, of thc municipdity
of Bo1ran,
Batang*r; thal t]re dsfsodqn! Florentino H. Rivero t rli cbarge or pocsession
of aeid
vgss€l rit}|out the knowledge or consent of the plaintiffs anJrefus€d to deliver
it to
them, under claim that he was the owner thereof; and that ,u.t p.*"aur*;"
til
defendsnt'8 part caunethe plaintiffs to euffer damages,not only hecaus€they
could not
proeed to repair the veas€l,but aleo becausethe.ywere unable to derive p-frt
fro- th"
vayagel for which eaid pilot txrat was cuptom,aril_v rrsed;and that the net amount of arrch
uncollectedpmfit wae Pl,?b0. The complaint tr..rrrrinated with a petition that judgment
be rendered by ordering the defendant to drliver naid pilot txrat to the plaiitifa
anJ
indnmnify tltflnr in thr' arnounl.al?rrt.nr.rrti,n!.{!(,r rl ruuchnrrrnrnl ar rhould bo provon
at trial, and to pay the coeta. .
Counaelfor lhe defendantenlered a general and specificdenial ofall the facts
set
forth in the complainr, with the exeeption of thn"* admitted in the epecial d"fu;
;;
contisting in that eaid pilot boat belongedto the concernnamed"Gelit! & Co.,"Bonifacio
Gilito being a crpartner thereof to tbe ertent of two-thirds, and the chinaman
sy eui, to
that of one-third, of the value of said vessel; that aubsequently Bonifacio Celitosoid
his
share tb his copartnerSy Qui, as att€et€d by the inatrument dxhibitA, registered in
the
tfi ol
offict of t}e C,ollec.tor
of Customeand made a part o[hi* &nawer;that later said Chinaman,
tlre abaolut€ly owner ofthe vessel,sold it in turn to the defendant Rivera, according
I tlt' to
lho prrhlir^ innl.ntrnnnt,nllr.rntl-lrhr,rlt,rhin frrrf{w..r
nNHxlubit It;und Llrat,firr thir *uirn,
'tr t o
Itrvera turk gxrexuitln of t"beoaid pilot lxrat Valenlirra, ac its cole o1v-ner. He thereforc
1 1 ' nt . petilioned that the defendant be abeiolvefrom the complaint, with the coots
iit rtf againrt the
plaintiffe.
After the hearing of the case and the intrr-rduclion of tlocumentary evidence,
" the
:lt l- judgment of September6, 1915, was rendered, frdm which counsei for the defendant
.ntrt appaled and moved for a new tnal, This nr{Jlronwas denied and appellant excepted.
i{. I
The record showeit to have been firlly pr(,vcn that llonifacio Gelikr sotd his
rltr',j ehar€
in the pilot boat Valentina, consistingof a two-thirris interest therein, to the Chinaman
tlilIl
Sy Qrri,thf co-ownerof the othtr one-thirdintr.rr,stin xrrirlvr,xxcl;whon,forethis vendor
r ,,1 rr no Lirrgtr r.rrtrtk,rlkr r.xr,rcixr.
,tlty lr(.1.t(ll
*.lrrl.r.vr.rrrr rr,s1x.ctto thr: lxrtt in queetion.
(ielit'ow|rrrotreof tht parfnershipownr.rHo{'thcValtnt.inrr,
as in fact his name appearein
the cr'rtificatcof proteetionistued hy thc llurr:;ruof (lusLorns, und the rights he ireld are
evidencedby ihe ar'liclesof parinership; but, thc whole ownership in the vessel
having
beencttneolidatedln behalf of the Chinarnnn Sy Qui, thrs iatter, in the use of his right
ai
the eoleowner of the Valentina, eold this boat to l'lorentino E. Rivera for p2d, b60,
on
d January 4' 1915,which facte are Bel frrrth in a dccd rutifi",l on the aame date before
a
notary.This docurnentwas registered in the Burcarl of Customs on March l?th of the
6gmeyear.
ila.r t
On the 2ild rtf that year,thst ir. aftr,r lhr srrk.ofltrr.lxrat kr thc defendantRivere,
btn
ruit lr'fivingbt'r'ttlrrou{ht in llrr,junt,icr,
of't,hr:ptlcr. ururl agurnrt tlre OfuilanranSy eui
trr i'nf{}r('t'pit-}'ntt'ttl
of ucertuitr strrrrof rror}ry,llre lalkr's credilor FaualoRubieo,tbe
hereinplaintiff, acquiredsaid vesselat a publicauctionsaleand for the eum of p56.45.
The eertificateofsale and adjudication ofthe boat in question was issued by the aheriff
on behalf of Fausto Rubieo,in the office of the collector of custome, on Januar;r 2? of
the aame year and was also entered in the commercial registry on the l,tth of i{arch,
following:
472 NOTESAND CASES(}N T'I{E [.AW ONTI(ANIiI'ORTATION
AI.|D ITUBLICtR'ILITIES
So that lhe pilot boat Valenlina wnn twicc nnid: firat privately by itr nwner Sy Qui
to t.he defendnnt to the dcfnndant.Itlorpntinn E ltiverri, on .Innuery 4, l9lS, and
afterward.stry the aheriffat public auction in *rnl'ormity with the order mniained in the
judgmrn! rendered by the justicc nf the peacrlcourt, on JanuarT 23 of the csmc y*ar,
ltgair.slthc Cliiriunrrrrr
Sy Qui and in b*,,halfoit.hi: plaintiff, F'auetsRubiso.
l
It ia undeniable that, the defendant Rivers acquired by purchaaethe pllot bont
Valentina on behalf of the plaintiff Rubiso;but it is no leestrue that the sale of the veEsel
by Sy Qtn to l'lorentrno E. Rivera, on January 4, 1915, wae eotered in the cuntoms
regielry only on March 1?, 1915, whiie its oale ia public auction to Fatteto Rubiso on the
23d of Janua4r of the eame year, 1915, was rscorded in the oflice of the Collec-torof
Cuetoms on the 27lh of the eeme month, and in the commersial regratry on the 4tb of
March, following; that is, the eale on behalf of the defendanl Rivera was prior to that
made at public auction to Rubiso, but the regietration of this latter eale was prior by
may daye tn the eale ruade to the defendant.
Article 573 of the Codeof Commerceprovides,in its first paragraph:
The requisite ofregistration on the registry ofthe purchase ofa vessel,is necessary
and indiepensablein ordcr that lhe purchaeer'srights may be maintained againat a
claim filed by a third perslon.Such registration is required both by the Codeof Commerce
and by Act No. 1900.The amendment solely consistedin charging the Insular Colleclor aa
of Cuetome, ae at present, with the fulfillment of the duties of the commercial regiater IN
concerningthe registering ofveseele:Bothet the regietration ofa bill ofeale ofa vees€l M
shall be made in the office of the Ineular Collectorof Customs,who, einceMay 18, 1909, I
hae been performing the dutiee of ihe eommercial register in place of thie lattsr official.
f
41
$tAtrt't'tMl;i.A\4 {?8
\i'.."r'i
"
l{{elL{ary*
Mortgage and other encumbrances over vessels are governed by the
pro\risions of Presidential Decree 1521, otherwise known aB the Ship Mori;gage
Uainst a
omr:ierce Decree of 1978. The same law as well as Section 12 of Executive Order llo. rgg
('ollcctor as amended ie being implemented with respect tn annotation/cancellation of
I reptster mortgages and transfer of rights and other encurnbrances of, vessels by
f s r essel Memorandum circular No. 100 which was issued by the MARINA in Aprii,
lh, 1909, 1995.
.r ofl,'tcitrl.
FT
471 NOTESAND CASESON THE T,AWON TITANSPORTATION
AND PUBLIC UTII,ITIES
I ,
wI{EnEAs,thereisgFecoguizedneedforextendingt.hebeaetltc
rccorded t(Do"r;l€* chipping under Fresidential Ilecrec No. 914 to
dornettlc rhlPPing.
Now,TIIEnEronr4LFERDINAM)E.It|ARcos,Procldontot
tbe Fhilippi""", Uy viriue of tbe powert v-eat-ef in rne by tbe
ao iru"*ty order thc enactment of n ahlp mor{gnge lnv
H
stl"
H,
C.o"titotioo"
rs foUos/s:
sEcTIoNLntb._Thiel}ecreeghrrllbeknownao"Tbesbip
Mortgage'Dccree of l9?8."
Fi
ii
t
MARII'IME LAW
Vcuselr
]ILIRI'IIMT' LAW
{71
Vess€lg
* l r i i r . r . r . r e c o r d e da u u t i c c o f c l a i n r - f a r r u n d i r c h a r g e d l i e n u p o n
t,he verieel, sE provided io Section ? hcreof, unlecs aftor aearch by
the mortgege satirfactory to the court, $uch mortgagon msster,othGr
ranking officer, c&ret&ker, or clnimant ie noi found within the
Philippinea. Failure to give notice to any such pereon, ae requirod
by this Section, shall b€ linble to such perron for damagee in the
srrrou.nt of hie int€reet in the vessel terminated by ihe suiL
SnCnONi$.
t*fi?"oLff
lf,S}",?#'
;i** "'
RrArIoN
{
f
482 NOTESAND CASESON TTIE I.,AWON TRANSPORTATION
. AI{D PUBLIC LTNLffIUS
..-- drptonatic
Daa _,,,?,^l^lg*try 1aoragagee or foreign narional wlroco couotry
rolatiorc with the phitippinee or whose country
jfaati reciprocal righte to Filipino .iti"*.r".
A, DOCUME}.ITARYREQLTIREIITENTS
V. SAWNG CI.AUSE
Arry provision of cxrsting llAltiNA cirr;rrlars, rulqre and regulatione
which arc inconsistent henrwith are hereb-vrepealt:d or modified accordingly.
VT. ET'FECTTVITY
T'hisMemorandum Circulirr shall t,akeeffrrctfiflccn { l5) dayefotlowing
its publicatrononcein a newspaperofgeneral circulation.
l\l ani l a, Phi li ppin es,O{ApltLJ9gfL
, A: PARTOWilrRS.
ARTTCLE 689. Iftwo or mone personc shcurd bo pert ownerr o(
a ssrqhnnl veecel, a pa'tnerrhip beprceumed.* otrru*.a
by the co-olwnera. "t"u
This parfnerehip ehall be governed by the resoiurio. of the
nrnjority of the members.
{-ctzrxr *rd Ruir v Lim, 46 phil. {t6; !vin6 l|*,:ev.gark'Monongahola,'4{ phil. {&r
r8ehn,Mryerv.lllcMiehlng;
rt o/., f l Fhil. gt0,
{s2 NOTIiSANCIcAsB{g0NTfini t.Aw
0N rnaNsnrntartoN
AND PUNUC L'TTLITISIJ
B. SHIPAGENT.
A8TICLE s9d. The ehip agent, whether
he ie at the aame time
11":.::::::l jl::"""1 ;" ;;;";;;l
eecociation of co-ownere, muat
ro,.*,, owneror ror aa
r'- -p.'orded in have th"e
the m"fqba&_;;;,*i-"Ir"" ,,!:ouinna
.|gs
peraone
*" rffiffit ffirme cornmerca
a. Poser*.
ARTICLE $$S" Tks uhip ageat rnay di*ahnrge the dstlsr cf,
eaptain of the vwrol, eubJeet in overy e*s€ to the provirioa of A#clc
809.
U two or rnone co-rrsynerg apply for tbe poeitlon of captlin, the
d.iengr*ement chqll be decidsd by a vote of the momt'tiiq dr& if the
voto rlrould rerult ln r tle, it phett be dsclded ln favor of tho m"
otwner having the larger tnterest in the veacel.
If the lntereotc of the npplicante aboutd be equ'I, and thsro
should be a tle, tfie rnatter shstl b€ decided by loL
ARTICI,E SS?.The ehip ageat ohall {siuate and corns to temr
with the captsin, rnd ehdl eontrect in the nqme of th* osuen" wbo
shs.ll br bound in gll thct refer to repaira, detaile of equipunent"
amnarnenf provlalonrof food nnd fuel, and frelghtof th*vwlnand"
ln gon*ral, ln nll i.hat relato to thc requiromentr cf nrvlgutloa,
b. Llrnlt*tlnn on lrolver.
ARTItlt-F 6O8.Ths rhip agent rnay not order & &er voyefcr or
make contractc lor n naw ehart+r, or inuurc tbc voesol, wlthnut thc
ruthorlzatlon of lte olirnsr or r.c;olutlon of the. m4Jerrtty of the oo-
own€r4 unless thece powerlr wene grrnted hlur-ln tba cfufrnto of
hia eppointrueaL
If he insurcs the vessal without aut"horizction thsrofonel he shell
bo rubcidiar{ly ltnble for the wolveney of thc inaunsr.
PR(}tsLEMS:
L X Mining (io. ShippN.d h c,irqoo{'machinerrieson br:ardrhe !i/S
GoodShip rvhich was chartered by the Able SihippingCo.,a foreign corporation
representedin the Philippinrs b.viL+agent. Best Lines, lnc. When the goods
were del.ivered to the eorreitr;nee,Y Corporalion, they were found to have
suetained losses.The insurer, Sunshine l4surance Co., paid for the loesesn
h' thereby subrogating itself ,o the rights r-rfX Mining Oo.of Y Mining Co. uds-
h,. d-uis the shippilngcompany and the shipping rgenr.
l'[](' Upon arrival of the SrS Good Ship in Manila, Eest Lines, lnc. took
'Ii I
charge of the following: tairunloadurg of the'cargoand resuingof cargo receipts
in its name for the purpose r:f evidencing the condirion and the discbArge of
the cargo fronr the vess€l to the {irrastre operatnr and"/or unto the barge
lightere; tb) filing and processingof claims against the veseelSIS &ood Ship
for damagevlosseseustainedby the cargo,
When Sunshine Ingurance Co. sued both Al:le shipping Co. and Best
Lines, Inc. the latt€r contendedthat it uas a dj.gclosed
agent and could not
thereforebe held liable,de*piteth* insr;lvencyaf Able ShippingCo.
Rule on the contention of Bctt l,inec, Inc. wit,h rearons"
A: Besl Linec, Inc. g cont*rrlronlacks merit. Articles 58{i ancl587 of
the Code of Cnmmerce makes the ship agent iiable for the civil liabilities in
favor of tliird pereonEwhich arise from lire condr,;ctof lhe captain in the care
'fhe
oi'the goodr. liability of the ship agent i.* eolidary together with the ahip
owner, hence, the liability remains even if the principal-ahip+wner is insol-
vent. t 1984)
2. Q: S nhipped goo<lsfrorn Australia on board a foreigrr vessel
owned and operatedby X Shipping Co.,basc.din Auetralia and repreeented
in the Philippines by R. the goodswere consignedto T of Manila and insured
by U against all risks. Up<lnarriv*l in Manila Bay,the go,odswere discharged
from the veegelto a lighler owned by the llay }3nrkcrageCo.
When delivered to ancl reterved b1,'t, tht' guuds were found to have
eustained logoeeor damr:gges. ilyidencr: discloaedt.hat the damage occurred
while the goods were in the cr.rstodyof the carrier.
The insurance company paid thr.:anrounl rif tlre loee tlut souglrt
reimbureernentfrom X andlor R. R disciaimedany liability allegiig that he
ia a mere agent of X, and having acted as agent,of s disclosed principa! ia,
therelbre, not liable.
Can the insur&nce cttmp&ny recover from R? Reas{ros.
A: Yes, the ship egent is solidarily liable with the ahip owner for
indemnities in favor of thint p€rs$n which may arise in connectisn with the
care of the goodn(Articles 586 and 587, Code of Comrnerce)^'lherefora,
lhe
insurance company can recover frum B the amount repreeenting the vah.roof
the goodalogt or da$raged. (1981)
4ffi ON'I'tt H t.Aw (.rN'I'RAN SI'ORTATION
N{ n'h:li r\ N I ) C.A-SUS
ANT} I)UBLIC I"ITILITISS
CA$SS:
The yrurpx,,r*rl
of the-actior bruuglrtirr llrt,scprrx'rr.drrrg,r
is t errablethe plarntiffto
necoverfrom the defendants jointly and severally the sunr of P450, which had been
delivered by the plaintrff [o the first. and fhird of the a]xrve-nameddefendank, master
and supercargc,reepectively,of,a bcncfl n:rmed iloria belonging to the seoonddefendant,
to be cerried, together witb various menchandisebelonging to the plaintiff, from the port
of Cebu ts the tovm of Catmon of the Province of Cebu. By virtue of the mntract executed
between the e&id seconddefendant and the plaintlff, the money and merchandis€ were
tn be transport*d by the said crall between the poinls above-narnedin consideration of,
the payment of a certain surn for each voy'age.'!"liemonr:ydisappearedfrorn said craf[
during the night of October 18, 1911, white it was anchored in the pnrt of Cebu and
nvrdy trt riaif for ils dr.ntinntion,C*t.mon,,:rnrlx'irs not.nftr,rwnrdsfound. "Ihe plainliff
hrrr.redhis action on thrl charge that lhe dinappr:irrarrcr" of said sum was due to the
atrnndonment,negligence,or l'ol.untary braach, un the part of the defendants,of the
tluty tirey had in respectto the safe-keepingof thti aforrmentioned sum.
The defendants,besidesdenyiag the allegations of lhe corrplaint, pieadedin epecial
defenee that t}e plaintiff, at his own expense and under his exclueive reaponribility,
charlered the said bcnc*, the property nfthe defendant l,auron, fur the fixed period of
three daye, atthe price of Pl0 per diem, and that, through the misfortune, negligence,or
abandsnmentof the pl*intiffhimself, thr: loss cr.rrnplnined of occurred,while aaid 6ancs
lvaa at anchor in the port of Cebu, and .rryascaused by theft committed by unhnovrn
thievea.They ftlrther allegedthat said defendnnt L,nurtn, th* owner ofthe bonca merely
placr-'dthiu cmft, at thc tliepoeal of lhe ptirinliff f'or [hc price and period ngreed upon, and
did not go with the &ancrl on its voyage horn Catmon to Cebu. An a counterclaim, the
defendanta aleo aaked that the plaintiffbe ordered to pay the freight agreed upon, which
had not yet been paid, amountfurg to P80, plus the sum of P?0, ae an indemni.ty for the
loaseaand dqmages caueed tbem by the attachment of the banca,iesusd at the instance
of the plnintiff upon.fili4g hir mmplaint. They also prayed for the additional aum of
Plfi), for tlre deterioration sf the said b@nco,and also thst of P2@ for other deterioration
suffered by the sane eince Novernber,L911,and which had not been paid for. Finally, the
dsfgnrlants asked to be absolved from the complaint.
Before ctmmencing the hearing of this case,the defendants made a vertal motion
aelring tbat the plaintiif be declared in defgult, with resp<xt to the counterclaim 6led.by
tbem in their nnrwer. On the *arne date, the plaintiffpreaented hie qnawer to eaid eounter
slnim, denlnng eaeh and all of the allegations thereof and of the defendants' epecial
defense. The aforementioned motion wari overmled by the cour!, and the defendants
excepted.
At the tersrination of the trial, the court, in view of the evidence adduced, held
that there was no room to doubt that the sole cauge ofthe diaappear&ac€ofthe money
from thb e&id6onca was the negligencecfthe master and the Buperc&rgo,the defendaqts
Ipil and Solamo, respectively, and that the defendant Narciso Lauron was reaponsible
for that neglig€nce, as owner of the banca, pursuant to articles 589, 687, and 618 of the
Code of Commerrce,the pl*intiff ttrerefore being entitled to recover the amount lost.
Jufument wae r?udered on April ?0, 191.!, in favor of the plainti$ and againet the
defendants joiatly and aeverally for the sum of P450, ',v'ithinterest tirereon atthe rage of
6 per cent per annum from the dnte of ftling of the complaint, October 24, 1911, with
'F
MAITITIMEI*AW ,19?
Ilersons Who I'ake Part in Maritrrnt Conrntr:rcl
wnrfi prtlr&nt{.(lrrl !,}u,trinl ns }hhilrita A,3,4, nrrrl6, nrrr}lry 1.f16' givln ut.tho
11'61-ltwrry
trial by the dn,fi:nrlarrllr lprl arrd llolamri, t.hat trrth *urrl cnlrrn-txryrand thtr other lwn,
Simerrn !{olnnro,und rnid cahin-lxrynlsri the o[her twc, llirneon Sotomo, and Eulnlia
Quiwnco, knew of thc existcnce of [he murrey in the trunk ineide the stoterrnm and
witnee$edits removal to eaid trurik from the plaintifFs; that the last two cabin-boya
ahuve-named,in companywith tlre mesler and thr. d,ulrerc{rrgo, conveyedthe plnintiffa
trunk, in which the money was previously contained,fronr the plaintitfs shop to the
bonca;and that no pereonnot.belnngingto the veegellutew that the money war in the
trunk incide ceid sist€rcrom.
Acconlingto the lestirnonyof the mastcr lpil hrrnsrlt'hr:slept outsidethe stateroofil
thnt night, brrt a cnbin-tioy nameri Gabrirl *lr.pt inridr. Tlre lnttr.r, howEysT,wnn not
ltrr'atttl*rlhy l.hr rllrlonrlanl*to hr rorarnurc,rl ir111,gnlrlkr Ilria 1xrilrl.,lrnr r*l*u t{ &f!!xtrtr
tltlrt ht t*"ltifir'd in rtnpoct tht retrrin hia uflidavrt, Exhitrlt 5, fN:firrcrtl'erred to, preuented
by the drferrdflrrt'8 own cotrnsel. The nrnsterlprilnnd t.hcsupr.'rcarga Solarnoalsoteetified
that they le'ft the cabin-boy Sime'onSolamo on guard that night; but this affirmqlion
was not corroboratedby Solamoat the trial, for he was not introduced as a witness, and
only his af{idavit, Exhibit 2, taken before the fiscal of Cebu on the day following the
contnrissiorlof the crime, was presentedby the defendant.s.This affidal"it, which should
have been admitted and not rejected,as w&s done iry the court and exceptedto by the
defendant.c,shows that Simeon Solamo stat€d that he was not d*signatcd to dcrguard
duty that night, but that on the morning ofthe said lgth ofOctober,that is, the next day
all agreedthat affiant shouldsay thnt he was on grrlrd, thorrghit was not true that he
w8s-
Fina!ly. said tu"o defcndants,the master and the supercargo,gave no satisfactnry
explanation in regard to the disappea{anceofthe trunk and the money therein eontained,
from the statproomin which the trunk was, nor as to who siole or might have stolen it.
The master of the 6anca merely testihed that they, he ancl tire supercargo,did to know
who the robberswere, for, when the robbery was crrmmitted,they were sound asleep,as
they were tired, and that he believeclthat the guard Simeonalso feil asleepbecausehe,
trn, wae tired. Th* st'condrkrfirndantgave thr.,Humctcst"ilron-v.Iloth of thtm testifir'd
that the snrall windr-rw cf lhe statersrm had beenbroken,and the lirslof thr:rn,i.€.,the
rnttr.kit',statltl llrnt rrll the window-blindnhad lx.,.lrrr.nroveri
frorrrthe windows,nrqwoll
as p{rrt erfthc pnrtition in which they were, ffid lh;jt thc trunk rn which the rnuneywas
il.;rrtiiincCcould have been passedthrough said small rvindow,treci:use.as this witness
himself had verified,the Chinaman'stnrnk, which difitrrr:dbut a little frorn the one
stolen,couldbe passedthrough the sameopening.The chiefpilot ofthe harbor ofCebu,
Placido Sepeda,who offrcially visited the said banca, also stated that the small wooden
window of the stateroornwas broken, and that he br:lievtrdthat in breaking it much
noise niust have been produced.However,no evidencewhatever r+'asofferedby counsel
for the defendantsto prove that it might have been possihleto remrivethe trunk from
the stateroam through the opening mnde by the breaking of the smail window,neither
was the size t-rfthe trunk provbn, in relation b LheL'hinaman'shr which the defendant
master referred in his testimon)',so that it rnight be vtlrified whether the statement
made by the latter wa$ tru{,, rriz.,that it might hnve lrr:enpossibleto remove from the
stat€room through eaid opening the tmn-k in which the P450 were contained, which
eum, the game ae the trunk, ita container, had ntit been found, in epite of the inveetigation
rnadefor the prrrpose.Furtherrnore, i[ wan not proven, nor ir*therc any circumstsntial
evidence to show,that the robbery in question wae committed by persons not belonging
to the craft..
It is therefore beyond aii doub! that the iosg or disappearance,on the night
afarernenlioned,of the P450,the prop€rty of the 1'laintiff, which, were in the poaeession
Mrlhlltlti'j I-{W
I'ersonsWho'firkc Part in Marlrirne Corrrrn,erce
4W
'.!r,
trf the defendants,the rnastrr &nd the supercargo
of the banca Mari,",occu*d thmusb
the manifest fnult and negrifenee of said defeniantr,
f"",-;;;y did they fail to take
rllrr the necesaaryprecaution;irt order that the.staberoorn
containing tbe tmnk in which
,!irl they kept the money r|:{a be properly grarded
! t\ 'i
by *"-U"r, tn;;; il;;Jfft
condition that it would be imposslue L eteal "f it or
!t
lhe irunk from that person* not
belongingto the ve$selmight forcean entrance
intu the stat€robmfrom the out"side,bul
.lr' also the-v did not expr*esltr station s.omeperson
inside the stateroom for the guarding
t,. and gafe-keepingof the tnrnk, for it war n,t provrn
that th* cabin-hroyoabriel etept
there' as the master.of the ves$er,Ipii,
stated, nor that the other cabin-boy, sinneon
Solamo,was c'nguard that night, for the latler
{-ltii contradictedthe ststementemade by tbe
two defendantson this point. on lhc ccntrary, it
fi, 'i was pruven by the martefs own Btstement
that all the people of the vessel, includtne
i : : tr himseif il ;d;;;;argo Solnmo, elept
noundly that, night; *I:h k cannot, in aly rnanner,
tltl eervethem &s an ercu6s,nor cnn
it be accepcedac an explanation of the etstsrnent
iltl that they were not arrare af what waa
thenrx*rias onboar4if fte rrunk*;;;""rry ;;;i;;#;;iJu-o
ion
the smsll rvindow of th9 atateroom, a aetail-which i'o **oved rhrough
lnd .!il;;;;roven, butn sn tbe
contrary increaeestheir liability, becauseit is very
tirt- strange that none of tbem, whs were
.t,1 sir and were amund or near ttre sLt€"oom, shourd
irave trei.a tn" noi* which the robbera
must have nrade in breeking its window. All of
thc theee cirn matancei together with that
of its having been impossible to hnow o,no t roto
ard the trunk and the money and the failure
to recover the one or the other make the conduct
la]", of the'two J-:*"a""* and of the other
membere of the crew of 6cnea, enrinently aupicio,rg
i ht: and prevent our holding that the
disappearance or lnse of the money ** a,r* fo
a for?uitoua eveat, to farw mi*urc, or
t"hat it was an occur:rencewhich cor.lldnot have
been foreeeen,or which, if foreseen,wae
1 {' r \ inerritable.
It'ti,
It is-unquestionablethat the defendant-cGlicrrrio
n tl. . lpil and Jus1r;Solamowere the
carrierg of thr eaid P4S0k,longrng to the plainr.itf,
anclthnt tlr_t;;;;;;il_;'f,oJ
the.latter lor the PuryL: of rieiivering it i.o
t,;il the store of the town of catmon, t' which it
had been connigned'tlnder guch circimstance$,
' li.'. sairJtlefendanLewere the depoeitaries
of the money.
,fl.'d
thtr
xxx
u,'li
Thc said tvi'odefendanLsbeurg the dcpositaries
of the sum in questron,and they
having faiied to exercise.forias safe-leeping'tl',e
ilt,s: diligence,uq,ri.*o ly the nature of the
obligationansumedby them and hy the ciierrnrgrnnrrs
('l lt
of the time ,i"i ir,- prrll'rr'i-
('t'l I evi<L'ntlhilt, in purltuflnc('|
of thc provixiorrn
ol nr.tielcxl{i0l lntl 1602,in thoir '*tati*n [o
articleg 1783 and 1?tt'1,and an prescrilr,r.din nrticles
d'!r'l:
1770, ofrhe Civit Code.they are
.i t l r ' l i liable for its loesor misplacementand mrrst reetore
it to the plaintiff, together with the
in st'l corre*pondingintereat thereon as an indemnity
for the lossesand damageecaueedhim
ffr rltl
through the loss of the enid ,run:.
{,t' ,
with respectto the other qlefendant,Narciso
rlerri l,aurtin, ae he was the owner of the
vessel in which the hs' or mispraccment
tlr'tll
of the p450 ocbunred,or *htch veaeer,ae
afrrre-ct€ted' Glicerio Ipil was *rrtur rna jrrto soranrc,Bup€rcargo,
r tilr' appointed to, or choeenfot.t!: both of whom were
hri:l: Frsiti{rns they held, by the dlfendaiit'*mueU and, as the
afr:rementinnedgum wae deliv€rea ro ti,* *uia
r f t , , tI *n*r.r, rpir, ;;J;h; inorchandiss to b$
trnrrrr;xrrtlrl lr.l'trtrlrn* of nri<l vr,nr*tllfnurr tlrl
I t l l . ti lxrr.tuf Cr,-huto tlre towrr of Calmon war
laderrby virttt| $f a conlract executedby and l.rctwcen
lhe plaintiffand the owner of the
*ll lli' v*ns{rl,Narci* l,auron, it bt"hnovenufl to *xlurrine
whether th; i;;rr areo,shnurd be
held to be liable, an requestedtry the plaintiffin
his complaint.
right said vessel was engaged-inthe transpcgtation
',i-cil)tI of merchandiseby sea and mede
voyagesto and from the port ofcebu to catnrrn.
and had heen equippei ,i-t"^r-J
"ra
600 NOTASAND CASESON THE I.AW ON TTTANSPCIRTATION
A,}'{DPI.IBLICLITIt,IiTIE$
ftrr thie purpo$e by its owner, Narciso Lauron, rvit.h'"virom,as aJbresald,the plaintiff
crrntrnctedfor the transportntira nf the rnerchrrnrlisevghichu'as to be earried, on the
e t n L r o n c t l ,r r n t t l t r , t r n r rotf ( i t ' l i ul o t l t r t t , w l to f ( i a t m o n .
d a t e h e r e i n H l x r vm
xxx
flniti4lly, tlw Supreme Cour-t explained that the banca called Maria, chartered W thz
plaintiff Yu Con from the defend.ant.Nbrci.soLauron, wctsa "uessel',pursuant to the
neoning of this word in mercontilc lau, that is, in accarclancewith the prouisionsof tfu
Cdz of Commercethen in force. SeeChapter 7 af this urarh.J
Gliceriolpil, lhe ma$ter of the said 6,rlrrr Ilirril, nrusl trlsobe consideredas it^s
c a p t a i n ,i n t l r c l c g n l; r c c e p t a t i oonf l h i r w o r d .
'I'he
sirrtrrCoclcol (lomnlr,rctin {brcl lri lhr:selsl;rrlrls.iirmpareil,
in its article 609,
rnaster-€with captaina. trt is to be notcd thal in lhe Code of Cr:mmerce of Spain the
denominationof arroecesis not included in said articie as equivalent to that of masters,
as it is in the Codeofthese Isl&nds.
General Review of Lcgialation
Cnrirmentingon said article, the afcrrenrentioned
and Jurispnrdenct'sa.vs'
is grvr,n,;rr:corriing
Tht, narncof capt,ainor mor"4ter to the kind of vessel,
to the personin chargeof it.
T h r . f i r x t .r l r . r t o t t r i l t r r t rior rnl p p l i , . r l l o I . l r o r i r , w l r1r 1 o v l t ' vt tr t t n r ' l sl h t l t ,
l r , r \r l i l l t rt,l r l l r r p i lgt r . r trr)' rs l i r p rl l l i . rgt , ', l r r r rt,i , r r , , r ;rr: t; i t il t r t l r l t ' t - t t t t rctiltl,l r u u g h
they be ertgtgedirr lhe constwisetrad*.
.lrrps t.,lrg;lgutl
Mastersarr thosewho comnrurrd.unrallr,r' exclusivelyin
the coastwisetrade.
For thc purporie.s t}re words "captain" and
of mnritim* c{)nln){'rct!.
"mast€r' have the same nreaning;both being thl: chiefs r:r commandersof
ships.(Vol.2, p. 168.)
Article 58? of the Codeof Com.mercein force provides:
Th* agcnt ehull tx civiliy lishb ftrr tht".indr:nrnitiesin firvor of lhird
p€roons which arise from the conduct crfthe caplain in the care ofthe goode
which the vesselcarried; but he may exempt hinrself therefrom by abandoning
' the veslielurith all her equipmenlssnd the frr:ighl he niay haveearnedduring
the trip.
A r t i c l e6 1 8 o f t h e s a m e( . l r < l t , u l spor t s t r i l x , < :
The captain shall be civilty liabte to the agcnt an<lthe latter Lo the
lhird personswho may have madecorrtracLewrtlr ltrr-'fornter -
l. For all the damagessuffered by the vesseland ils cargo by reeson
or crime has been'
ol'want of skill or negligenceon his psrtr If a nrisderne&nor
committed he shall be liable in accordancewith, the Penal Code.
2, For all the theft,e ceirnmitted by the crew, relerving his right of
action against the guilty parties.
The Codeof Commercepretrioustc the one now in force,to wit, that of
1829,in its article 624, provided that the agent rir shipowner should not be
,l
}L4}TI'I'IMII LAW
Pprmrrr\aihoTnke Part rn }tnrir,nlr,(.ory111sr,1"gg s0r ti
$
lirll-'iel'or an.vexcess€swiricil, ciuring thr-,navrgar.ion,
tlr. crPtnitt ttnd crt'w.n;rd i,hrrt.l'r tlr* [r,r]i{)rl
rnight be eomnitt*; b"y $
'l'such exfij$rJ€ru,tt lva* 'nly
propsr'to bnng action agarnstthe pxrrson*
and property ofthoae found guilty.
Eskrsen,in his work on rile Inrtrtutcs of Mercantile
Law (Vol.4,p.ltJ3b),maLes the
follriwi^g rtnrarke, in referring to the expoetr;;
l. ;i;;;", p.u*un,"a by tho code
'1, comnrisaion rrhich prepared arii pr*xrnled fu, ,pp.ouut
the crxe orcornmerw now in
force' in which expoeition of rcaxlns were set fo*h
I' ihe fundarnentsl differences betwoen
tJre proviaions conLa.inedin both cqldes,urith respect
to the euuiect-nratter now under
discusgion.He says:
its
.- - - Angther very important innovation introduced by the Code is that relative to the ,ll
liability for misdemeanoraand crirnes committed
by the captain or by membersof the
xj.
crew'Thie is a matterof the greatest importance
expressedb.vdifferen t j uris-consults.
on which r u.ri"ty ofopiniono hns b€€n ii
ii
hr'
f \. The old crxle declares the captain civilry liable
for ail damage austained by the
vesselor its cargo through lack ofglill or care on
his part, through violations ofthe law,
.r through unlawful'ncts committed by the rre w.
ltll'l no ,*gar.l" *,"t"rt or shipownora,it
declaresin unmistekeable terms that he ahail in no wiee
be liable fJ, uoy which,
during lhe navigation, may be conmritt*J Uy ti,"
captnin and the cr€w. "r*n
upon an exarnination,in the tight of the principles
of modern iaw, of the stand.ing
llgr,l ll,rt.r'in,:ou tha nou-liabiLill_of lhe sir;powner
for the untar+ful act€, that ig, the
crirncs or quasi crirnee,cornmitteclby tlrr caprain
anr] r,hecrew, it is obeervedthat it
cannot'be mainlained in the abeoluteand caregorical
terms in *i,i.h it l, rorrrlul*tea.--
It rs *el! and goodthst the shipowner be not
held criminally liable for such crimes
or quasi crimes; but the cannot be exrosed from_liability
for the dalage and harm which,
in conaequenceof thoee acts, may be suffered by
the ihlrd guJi*" Jlro contracted with
the captain, in hie double capacity of agent and eubordin"t"
*ltipowner himaclf. In
maritime eonLmerte,the ehippers and paseeng*r"
i;;"ki"g;;-;;"rtlr" with the captain
do aothrough the confidene they have in the eh-ipowne,
or,o ippoint*a niq irr"y p*L*"
llrat the owntrr made r careful inventigation treforeappointing hinn, and, above
t"heythemeelvesare unabre 1o.et ell,
to make such e; investigation, and even thougb
d'*r' the,vcould not obkrin cornpleoerccurity, inagmuch they nhouid
aa the shipowneil;;i;ffi;
hr s€esfir. appoint another.upLi" instead.
The shipowner ie in the name cai+ewith reepect
to the rnembers of the srew, for,
though he does not appoint direetly yet, expresely
or tacitly, he contributea to theii
eppointroent.
on the other hand. ifthe ehipownerderiv*a prolits
from the results ofthe choiceof rr{
the captain and the crew, when tire shoiee t*rrs out
successfur,it;;; j;ffi l* rl
ahould euffer the con'equenc-esof an unsucceseful
uy""ppuo"tion of the
rule of natural law contained io the Fartidas, ure., thai
"pti";;;i,
iw who enloyi the benefitsderiwd,
fram a thing must tibewise suffer the l*sses ihot enrue therefram.
Moreover,the Penai.Codecontri.insa general principle
that resolveethe question
under cnnsideration, foi'it declarer tnat *uci, persons
ae undertake and carry on any
induatry shall be civilly liable, in default of thoee who
may be criminapy liable, for the
rni*dernean,rsa'd crimes comrnitted by their. surxrrainrLu
i" lr," li*h"rgu of their
dutieg.
'l'lrr,{',rrL,ol
( ' 1 1 1 y 1 s 1 1 1 , 1 1l i.,1r 1 , llt rp 1 1 L } r
l l t . i t | , r . l n r . r r t l r l r gr l . r t , r t r - l t u l l t l i t y c l r l r t l i n O d
ift
1 f t r 'o l r l t ' t t h ' , r t l t t l r : l e I t ' l y l t t t t k t , $ t l r * u l r i p o w n r r r
lrublc crvilly ftrr lhc loes suffrlrod hy thoaa
502 NO1ESAND CA$EII ON TT{NI,AW OIf TA.ANSPORTA?ION
AT{DFLIBLICLTILTNES
G. I-,othigius,the captain of the bont; and rhe rlwner$of the hroat,eifherVictor S. Fox &
Co., Inc., or the United States Shipping Board [rnergency Fleet Corprrelion. Capta^in
l,othingrua and the Admirai I,ine alier*e'red.The owntJrswere not cit€d to appear.No
i
actionagainatthe bark wae taken. t'ollowing the hial, judgrnent w&srendereddiemissing
the complaint, without apecialfinding ae Locoats.
'fuining :l
nirxt to thc f*cbr,the exhihitau{'rct:ortlrclrowlh$t lruginningwilir Murch
l6 1921,anri ending with Ar:gust 16,1921,variottnsirpplii:swenefurnished the Bark
Monnngrrhrlrihy Wing Krt Compn*ldoringOonrplrn.yliout of the bills ftrr tlresr:gnndnare
made out against the "Admiral Line, S. S. $lonongahela.'All are counteraignedby the
mast€r and the first st€ward. It appears,therefore,that lhe plaintiffwnu looking to the
Admiral Line for paymenL.
ltre first requisitione for supplies are on forme headedThe Arirniral Line." Then
followeManila, the date, and the name,'\{ing Kee CornpradoringCo."Next ie the nrder,
*Pleaeedeliver to S. S. Monongahela now lying at Bay, the following gmd* and
reading:
rend bitla to the Admiral Line:". After thi* the goods are namd. At the fmt is found,
"United States Shipprng Board Emergenc"vFleel Coryroration,' although thes€ trords
*The Admirai Line (Pacific $fssraship Co.)
are erased in a few of the requieitions,
Operating Agentt. By J. J. Arustmng." On the eide of the requieifiona in red ink the
following: "Note: This requisition muet be receipted by either Chief Offier, Chief Steward
,rr.{lhiof llngineer and returneti tr: the Adrniral Line, with eix ccpieeof invoice immediaiely
aftcr deliver of goode."Aftcr May 4, 192l, the requisitione Beemto have be+n made out
by the sieward and the maater.We deduc'eliom lheae docurnents lhat the Admiral Line
wge t}re operating agent for the Monongahela, and wes respsnsible aa such until the
egencywaa terminated.
In the Manila Daily Bulletin for Ari.gust't, Ig?I,appeared rhe ftrllowing: "Notice *
Bark Monongahela - The qnder-rigned hereby 6ive not,icethat they are not rerponaible
in any manner wheteoev€r for any indetrtedneaeincured by the Bark Monongahela, its
Master and/or Crew - llhe Admiral Line." The trial jufus found ae a fact that on or
beforeAugtret4,lg2l,the Admiral Line had ceasedto act ag agent for the lvlooongahela.
Nevedhelese,supplies were furnished ihe $lonongahela after theae dates by the plaintiff.
'fitle
Turning finally to the law. we find section I of 2 of our Code of Commerce,
given up to the subject,"Ownera of Veeselgand Their Agents."The first article in thie
sestion {Art. 586) and the pmvision of law which in our ludgment is controlling, reade:
{he owner of a veeseland the agent shall civiltryliai;le for the acts of the captain
and for the obligationscontractedb-vlhe latter to repair, equip,and provisionthe veseel,
providedthe creditor provesthat the &rnourltclairned was inverted therein'
-By agent is understoodthe personrntrusted*'illr tlrr:provisioningofa vessel,or
who representsher in the port in which she happens lo l^r*:."
ht'
The civil law, in this reepect,is not at ail dissinrrlar to the c(lmnlortlaw. By t'he
t't
genernllnw of the tlnited Statesas rvell as thr: En6;landand }iurope,it haa been held
.ri lrl'th*ir prtncipal,
that whcn the ugcntsbuy in lhcir etwlrn$ltl{jn,bul rcrrllylor Llrr:itccourrt
the celler has an option tr look tc either for payment, unlesn:(t) he trust€d the agent
J11
exclusively;or (2) by the ueageand uriclerslandingof uhetrucines$lhe agr:ntonly is held;
[t':
or (3) unlessthe specialcircumetancesoflhe case.showthat only the agent'was intended
etl. m be bouncland the eeiler knew it or was chargeablerrit.h knowledgeof it. Although the
English rule that, nhere the agent huys in his {}wn name for theaccount of a foreign
61. principal, ihe agent only is bound appeare not !o have tleen followed in the United Statee,
r ni t yet the general doctrine is the same, that the eeller has an option to reeort to either.
'!: U r B e r * ' i n dv . S c h u l t zt 1 8 8 5 1 , 2 5F e d . , 9 l 2 . )
604 NOTNSAND CASESON TI{E T,AWON fRANSPORTATION
AND PUBI,IC UTIIJ?TES
In rt''qttn:ti'
th0rr'l'rrt,.wenrr nf opinionnnd xo holtl
lbr lhe Ilurk M0rr'ngrrhela,is liable thnt,thr.Arlnrirall,irrr:,ns rrglrnt
to ti* prni"unrrr suppliesfurn;rtr*a the lrlo'ongahelg
betweolrMarch I6, I92l and Auguet
z, tszt, but in not responsibre for f,rnished
after that date. The mathematicar
the plaintiffamounts to pl6,sz6.zg
;d;;;;;
-----"- show rhat tt lrrc qEU!
a"ui uI I "uppliea
ir,e Admirar Line to
" "l
In accordancewith the foregoing,judgment
ir reverserianclthe plaintiffnhall have
Rnd r*rtrver fr'm thc dcfentrant,thr:
a-l"i**i'i;rr-, Lheeurn of pI6,626.2g, withnut
and coat.$o ordered. interest
WALTER LUMBER
co.
;fffiY:Tfl:lfl3ff"
65Phil. sr?.
on Auguei 30' 1926, the ateamer
Heren c, beronging to the defendant, the
cadwallader GibeonLumber cr.,
courfleof ita maneu":lt of oaptain Miguer Lasa, in the
moor"ritrirr".o*n.,on,r
at ttre ptalntlrr wh'rf in ttrr,
z n t t t l x r a r r g xr tl ' r r t ' kx ' i r l . l h3n r t ;xrrr .,f ()lrrtn'(',
1 u r r t r , , l i r , t , l , i i , , 1 t " , ,rrr,.,;gr r r r lt , r , , * , , , gt r r er r r ' l x r r
lht'n''rt inhr th* wxt.n wherougxln 'rl*6
ttr""pi*intlft'br'ught rhr instant acti'n t'
from thc dcl'endantthcnum orPs,zos.ci, rocover
us danrag.srirr t.h. partiar dernorit,ion of the
whurf nnd for the losc of the timU", pifuJn.r"on.
Btruck the dock but not with lbrce,for it was di{ficult for her to strike it' with
d force, aa hereinbefore "qtated,and due to the bad condition of the dock tbe
. slight impact w&s RulTicir.,nt to dertrny it. Tht lxrnt of the pileo toward the
k
i
€a8t Bide of the doch, as may be ceen frcm the pictures Exhibite E and F'
l. afbr itx dostnrction, doeanot lt{re$r{,arilynrctn Lhat tho deetnrction of *|o
'
lc
wharf war caucadby a rtrong impact, nr tho weight of the 60,000board fd
rt
cif lumber piled thereon, nlter *rrch elight impact.by the ateamsr aSsinst tts
,h dock, might have causedxaid pilee to lean townrd that aide'"
We are of opinion that this finding is supporredby thc evidence.In thia corurection,
it ie t, be nofed that tlre witnees, Dioriisio Pascua(for the plaintiCI tegtified that the
ht 60,000board feet ocrupiedone-fourth nf the wharf. In other words, by the tcatimony of
t{r the plaintiffs witnessesit has been proved that the plaintiffcompany piled up on the
iitl wharf a quantit"v.. of timber which {rxcecd*dit,s eafacity of resistance,becauseif the
rth whole wharf hada capacityof 100,000board feet of timber, one-fourthof it could suEtain
l{'ll one-fourthof that amount, or, nhout 25,0OOlxxrrd frrct,of timbcr. But it appearethat the
plaintilTcornpanyloadetl60,000lxrarelfi:ct, wt:ighrtrgt.rvtrl(Xitlnx, within s spaoecspsble
of rupporting onty 25,000bosrd feet. fitis must havg helped to bringabout the collapac
of the wharf on the eastsrn side and lhe consequentsliding down of the limber piled up
€fit
rela
on the one side.
hod
:8 to The court belowdid noi make any deilinitetinding as to the negligenceof the captain,
but the plaintiff apparently infers that there was nr:gligenceon his part, consideringthe
teetimony of its wilness Venancio Ignacio to the effect that the impact of the ahip with
the wharf wae due to lhe excessiveforce with which thc captain orderedthe wincheeto
Ulvt'
work. This was denied by the captain, testifying for the defendant.If, to thia denial, we
fresl
add the facte found by the trial court that naid captain dropped two anchors from tlre
prow and the kedge-anchorfrom the poop,and besidea,fastcned two linee of cablesto
ihe piles ordinarily used by vess€lein docking al that wharf, as preliminary to drawing
the vees€lalongsiJe the wharf, it witl be seenthat gaid winchee muet havc been carefully
gperated, and ii any forre was employed in working them, it wae doubtless due to the
fact that the veseel had already dropped anchor and could nnt move rapidly and the
'st.rearnwhich flowed from eaet to
,, Ll;l drawing of the veseel up tn the wharl was against the
n ii'e weet.We do not believe.thatthe mere statement of the witness lgnacio who has not kn
Sltglt' ehown to posEegstechnical knou,ledgeof the inaneuvers for docking vessel8,is sufficient
-
Prled to justify a holding that the fore employed by the winches on that occasionwa8 excessive
:f(\vi'r under the circumntancesof the caee,especially so if the captain's teetimony ig to be
ol t ilt' that.the u'incheswere clrefully rlpcra[r:d'
considered,
The witnesses for the plaintiff stat€ that the steamer Helen C atruck the wharf
<l ti:it
twice. but the trial court, after examining lhe evidence,found eaid t€etimony to'be
llt", 'rl'
(' exaggerated.
It it'l-r
As has been statcd, the plainiiffaeeks to recoveragainst the owner of the Bteaner
gcts of
Helen C, with whom it had no conlractual relalions basing its action on the
Il.it :he
Captain L,asa\.l,howas in comrnand of the vessel when docldng at the plaintiffs wharf in
tlit'lriss
Olutanga, Zamboanga. In support of its conlention, the plaintiff cites thi doctrine laid
,JrrtllI. (49 Phil., 117),wherein
down iri the caseof Ohta DeueiapmentCo. u. SteantshipPompey
it wae held that the defendant .o*puny, as ehip-owner, was liable for the indemnitiee
arising from the lack of skill or from negligence of the captain'
itr
F5
In the casecited, the steamship Pompey,under the command of Captain Alfredo
plaintiff' The
| .l Galvcz,was caqring cargo consisting principally of flour and rice for the
a*tua with her hlw facrng the land rrnd litstcnt'ti hcr c&blesto the port'oon the
!lll .nip
.tlr
NOTT]SAND CASES ON THII I,AW ON TRANS['ORTATION
AND PIJSLIC UTII,ITIUS
pier. The evidenceshows that heretofore other ships docking alongside said pier had the
bow facing the land and faatened a csble to a tree eituated farther wes! on the beach, a
precaution taken to avoid the xhip getting too clcse tn the pier.When the Pompey docked,
at the time in queetion, ehe did not fasten the cable to the tree on the ghore, nor drop her
kedge-anchorsfrom the prow.After being dtxked, they proceededto unload the flour and
rice which were lirst dep':ieitedon the pier and later transported to the plainti{fs
warehouse on land, where it was officially receipted for. The work of diacharging and
hauling the cargo to the plaintiff's warehousewas zrccomplishedwithout ary intervention
on the part of the plaintifl and exclusively by laborers and the crew of the ship. The
unloading of the cargo on to the pier was hastily done and thr:r'ebeing but fifteen or
twenty laborers engaged in hauling it lo the plaintiffs warehouee, a large amouni of
eargo accumulated on the dock. Ab 11:10 that morning, the pier eank with all the
merchandiee.
As may be noted, the fscta in that caa€ were different from thoee ia the caee in
question" In the former a contract of marine tranepoftation existed between the plaintiff
and the dcfcndant,whcreaein the iatl,nrno prerir.rurr:ontracluslrelalion exict€dbetween
the parties. For this reason,the caseof Ohta l)evelopmentCo. was decidedupon articlea
587 and 618 of the Cr:deof Commerce.But the inetant case,dealing, ae it doea,with an
otrligatinn arising frtrn culpa aquiliana or negligence,must be decidedin accordance
with articleg 1902 and L903 of the Civil Code.6
xxx
Co.( 17? Cal., 6lS, 612),in an
In the caseof Marylund Cosualty Co.a.Matson Naru.
action similar to the preeent,lhe cnurt held:
The eeme doctrine was upheid by the Supreme Court of Spain in its judgment of
June 23, 1900,in deciding a cas€similer to the one at bar, where the plaintiffwas a third
l){rriiur!without arry contractul! relntion wilh thc dr'fcndunt before the acts werg
committed which gave rise to the c.omplaint. ln that jud6rment, the court eaid:
sfuticfe l9O2 is the pmvieion of the Old Civil Code on quasi-delxt while Article 1903 is its
provieion on vicarioua liability ofcertain persons, including the employer.
MAITII'I}TFJIAW 607
PergoneWho Take Part in Maritime Cornrnerce
-Among
the questio's nloEt frequently raised and upoo which the
majority of caseehave been cecided with respect t,' the applieation of this
Iiabilitv, are Lhosereferring to the determination of ttre d".r,*ge or pnejud.ice,
and tn the fault or negligenceofthe person responsibletherefor.
''lhese
are the fwo inelispensablefactors iir tbe clbligationeunder
discussion,for without damageor pr*.|udicethere crin be no liability, and
nlthoughtlrix r'lerrrentis;;rtsttrt tl indlrnrrL.r.curr lrearvurdrdunlerss ariuing
frum stlmeperson'sfault or negligence.
-\l'rlh
rtslrct to thr drt'rnninaLrrrrr ol tlarrragr,.;.
l! n)ustlxr delilritcand
the rrrjurymust not be oc'casionecl b1'the perfrrrmance ot'an *l.rligarionor by
acts{jr omissionsof the injured part;n'hinrself; and firr the proofof the fault
or negligence' nleresuggesiions or inadrnissible presumptionswill not suffice,
but such evidencemust be adducedas to excludeall doubt regardingtheir
I existr:nceand relation tri the injurv. for, in nrder to give rise to an oblitadon,
there nrtrst|.xrlptwe.cnthr' fault or rrlgiigi.ni'r,and the evil n:nulting therefrom,
s a casualrelation."(l2 lr{anresa,fiOl,6{)2.1
It i8 not true that proofofdue diligence and care in the seieclion ofand inetnrctions
to a e€n/ant relievee the master of liability for the fcrrmer'sacts; on the eontra4r, such
proof ahowo that that liability never exieted. Ae Manresa (Vol. l{Iil, page 6g) aays,the
liability arising fron arl extra-contractual wrong ie alwayo traeedupon a voluntary act
or cmiasion, which, while frce from any wrongful inteni, and due [o mere negligence or
carolessnese'causes damage to another. A masler who tokee ali pcssible prJca-ution in
xelectinghln servants or employeres, bearing in rnind tht quatific*iionn noceanaryfur ths
;x'rforntrttt:t'of thtl dutir:s to be enlrusted to therrr,arrd irrstructs l,hernwilh eqri.alcare,
complieswith hitr dr:ty to all third par-tiesto whom he is not troundunder eontiact, and
incurc no liability if. by reasonofthe negligenceofrsuclr$eryantsthough it be during the
performance of their duties as such, third parties should suffer damagee.It is true-that
608 NC}TESAND CASIS ON TH}; INW ON TRdNST,ORTATION
. AND PUBI,IC I]TILTTIES
under article 19OBof the Civil Code,the law presumeethar the ma,ster,if regardedae
an
esteblishment,has been negligent in the eelert;onof, or instruction to, ite s€rvants,
but
that is a meFejurio tantum piesurnption and in destmyeciby the evidenceof due eare
and diligence in thie rerpect.
Tho $upreme Court of Porto Rico,conrtruing ielent"icrrlprovi*ionein the Civil Code
of Porto Rim' held that thes€ articlee are applicable only to casesof extraontractual
q,Ton6{Carmona v. Cueeta,20 Porto R.icoReponts,Zl5).
Thig distinction was clearly stated by this court in Bahin u. Litonjua ond Lcynes
(30 Phii.624), wherein the action was baeedon the
defendanfs extra-contractual liability
for danages occaeionedby the carelessneaaof an employee of hie, in the performt r.* of
hie duty as such. Thie court, after citing the laet paragraph of article lg03 of the Civil
Code,held:
"From this article two things are spparent: ( rt That when an injury ie
caused by the negligence of a eervant or employee there inetantly aris,cea
prer.umptionof law that ther* waa negligenceon thc pnrt of the mast€r or
empltlyereither in the selectionof the servant or ern5rkryee, or in supen"ision
over him after the selection,or both; and <2t that prexumptionisjuris ta.ntum
and. not jurjs et de jure, and consequently,ma.vbe rebutied. It followg
necessarilvthat if the employershowsto the satisfactionof the court that in
eelectionand supervisionhe has exercisedthe carr:rrntidiligenccofa gcod
f,atherof a family,the presumptionis tivercorneand he is relievedfrom liability.
*Thia
lheory basesthe responsibilityof the rn:rsrerultimafely on his
own negligenceand not on that of his sen'ant. This is rhe notablepeculiarity
ofthe spanish law ofnegligence.It is, ofcourse, in striking contrast to the
American coctrine that, in relations rvith stranS;ers,the negligenceof the
seryant is conclusively the negligence of the master.'
The opinion of this court is thus expressed,to the effect that in case of extra-
contractual wrong, some fault personally imputabie to the defendant must exiat,
and
that the laet paragraphofarticle lg03 nnly esiahlishrsa rcbuttlblc presumptionand ia
on all fours with Manresa'sauthoritariveopinion(Vol.XII, page61i;, that ihe liability
createdby article 1903is enforcedby reasonof non-pr:rfornluil.,, of duties inherent in
the npecialrclatio's 'f uuthority or superiorirycxistirrgberwc.r the pcrs'n liable
'the for
damagedone and the person who by his act or omissionhas causedit.
The defendanicontendein ite answer that the captain and all the o{ficersofthe
steamer Helen C were duly licensedand ar.lthorizedto hold their respectivepositiops
at
the time when the wharf in question collapeed,and that said captain, officere,and
all tn
t'hemembereof the crew of the steamerhari lxrenchnsenflorthcir rcputcd gkilt in direrting
wi
and navigating the eteamerHelen C, safely"carefully,and e{Iicientiy.The evidenceshowg
that Captain Lasa at the time the plaintift"s wharf collapsedwas a iuly licensedcaptain,
to navigate and direct a vesselofany tonnage,and tha.t the appelleecontracted
3uthorized
hia serviceebecauseof his reputation as a captain, accordingto F. C. Cadwallader.Thia
being so, we are of opinion that the preu,.r*piion of liability against the defendant has the
been overcome by the exersise of the care and diligence ofa good father of a family in
eelectins Captain Lasa, in accoidance with the doctrlnes laid iown by thie cou.-t in the at
caeeecited above, and the defendant ie therefore abeolved from all t;au;t;ty. AD
- wit'h rugard to the first error, the following facts are proven; That during the day
ht'
&t and.nighrof the r2th, and-d,ring therday of
the ilth of Maich, iszg, thu* weru loaded
rll in the eaid motor bost Arfonso 2,00{r canesof petroleum
.;d 8,;;t'ca3.ga of gaeoline, of
rt which 5,000 caaeaof gaeoline and 2,0oo of petroleum
were placed in the hord of $aid
4S motor boat, and the bs** on deck; that said roading *ithout permiesion
from the custoims authoritiea; rhat ihe saiJ "'""'aoo*
crs€e wer_e roaded by meana of etraps
supportiag 10 or 12 caseeat a time; that the
eaid caaesof gaeoline ui.d pua"uh,r- *"o
placed in tlre hold about 14 fmt from the
boiiei of the main engine and about 4 feet 6om
a3 the boiler of the sm'ller englne; that on the
evening of the l.'th M;;, ;ffi:r#
in smeller engine wao in operaiio" p"uparatory "f notor lmat
to the diparture of the which,
h* st' that t'ime, wat getting ready to teave; that ih*
fir* in said -otoi uoat burst o{rt with
an explosion followed by a violent erpuleion of ga;ioline
and petroreum; tbat owing to tbe
prorimity of the motor boat to the aLarner y.
*,ntua, tf," r,i"grrii"d.if the fire and the
inflammability of the materiar that servedu,
irr"l, the fire epiead to tne eaio stermery.
and so rapidly that it was impossibL-for the crew
11*' of the y. sontua to che* its
Pmgre88.
510 NCYTES
AND CAST^S ON TT{E I.AW ON TNA,NSMNTATTON
A,ilD PT,BIJC T.InIJTIES
Expert testimony was also intnoduced by the plaintiff to the effect that it is but
natural that, after eeveral hansehipmente of more than 8,fi)0 casee of gaaoline and
2,000 caseeofpetrole'm there is bound to be a leakage, on an average of 1 to 4 caaeeper
hundred, due to tlrc fact that the loading is eff€cted by meann of otrapa nrpporting fronr
10 to 12 cas.€ at a time which, quite frequontly, receive violent bumpe reautting i11drgage
to the csnt and the consequent leakage of either gasoline or petroleunn, e8 tte o". *"y
be.
It was also ehown by expert teetimony that the gaeeeformed by the volatilizatjon
of the gaeoline or petroleum leaking from the c&ses are apt to accuruulate in a
compartment, such aa the hold of a ahip, without eufficient ventilation cauaing the gas€s
to ignita upon coming in contact with a eparh or upon the'temperature baing rufhciently
raired.
Under these cirflmstances we ane onstrained to hold that the fire whicb caused
tho da'mageefor which the plaintiff eeeksto b€ indemnified wae the inevitable effect of
the exploaion and fire which occurred in tlre motor boat,Alfonao; that tbie exploeion and
fire in the seid motor boat ie, with good ground, imputable to the negligence of the
persons haviag charge at that time of s&id motor boat and under whose dir€ction the
loading of the aforegaid ca.se8of petrole'rrn and gaeoline had been perforurad.
The trial court d.idnot, therefore, commit the first error aseignedby the appellant.
In the aecondassignment of ermr, the appellant coniende that the defendant ougtrt
not to be held liable for the negligence of hia agents nnd employees.
It ir proven that the sgents and employeee,thmugh whosenegligencethe explosion
and fire in queetion occr,rrred,werrsagents, omployc*ea, and mandatories of tlre dofendant.
Where the vess€l is one of freight, a public con"ern on public utility, ita owner or agent ia
liable for the tortuoue acta of hie agents(arta. 58?, 6lIJ, and 618, Codeof Commerce:and
arts. 1902, 1903, 1908, Civil Code).This principle hae be€n repeatedly upheld in varioue
decieionsof this court.
The doctrinee cited by the appellant in support ofhie theory have reference to the
relationetetween principal and agent in general, but ngt to the relatione between ship
agent and hie agenta and employeee;for thia reaoonthey cannot be epplied in the preseni
c8s€.
!n:tnreric:rn !n*',pr.inciplessimilar to thoseilr forcein the Philippineeand eonteined
in the Code of Commerceabove-cited,are prevailing:
$rith regard to the allegation that the obligationg enumerated in a.rticle 612 of our
Code of Commerce ere inherent in the mast€r such inherent dutiea do not limit to the
$i
ilIARITIMI: IAW sll
'l:rko
i'r.r"ons'\fho Part in Mantrniri Oornnrerce
l u t l l r t . l r e c r v i l l i a b i l i t y A r l n i n g I r o n r t h e t r r r o r r f i r l f i l l l r t e n t ,h u t w h i l o t h e m a t t n r i s
t
rr,ngxrrr*ibloto t.!rerhip nfit,nt. lhr, *hi1i rrgr:rrt,ilr l,rtrn, ir, renprrnaihloto third peflont' as
is clcurly provitlecl in lrlicle tilS of said (l>tlr., rtr *'lrrelr cxlrrons lnerltion iri made, in
i n t h e : : n i da r t i c l c 6 t 2 .
. s r r t r s c c t i o r5s a r r d 7 , n f t h e r t r r t i e so n ' r t n ( ! r : t t { ) d
I
Therefore there is also nr,rground for holding thgt the second error assigned by the
ippellant hau been cornmittcC.
t
I
tI. CAPTAINS AND MASTERS OF VESSELS
J A. CONCEPT.
t
ln Yu (|an u. Glicerio Ipil,,:t o/."7 the Supreme Court quoted Spanieh
commentfiries on the Code of CommerceE which explain that strictly speahing'
i
"the name of captain or mast€r is given, according to the kind of vess€I, to the
rf person in charge of it. The {irsl denomination is applied to those who govern
d
vessels that navigate the high seas or ships of large dimensions and importance,
le
e although they be engaged in the coastwise trade. Masters are those who
cornmnnd $insller shipa errgagt:dexgltrsivr.lyin tht'cotrittwise tracle."
*firr the pllrposcfl of maritime
,t Nevr.rthgllss, it was alno clnrificd i.lrat.
fr1111{'l'('r,, l.lrr,rvorrls"r'rrJrt.rrirr" rrrrrl"rrtrtslt't""lrrn't' t.ltcrlttno rn{ltlning;}xlt,hbeing
rt 'Ihus,
the shit'fs (lr commanders of ships.ry the terms "captain" and "rnast€f
a r e u s e d s y n o n y m o t r s l yi n t h e C o d c o f C t l m n t e r c e .
.)n
\| Simiiarly, pertinent regulatiOns issued by the Maritime IndustryAuthority
t-' illr\P,I\.\ I ritfine s,rt "Inasti.r" iis i,he pcrson having command of t.heship.r0 The
rld sarne ternl is being used both frir dornestic Lrade and international trade. On
the other hand. a "boat captain" nteans a pfirson authorized by the MARINA to
t act as olTict.r and/or in command of a boaUship or has the qualification/licenee
tI t 0 a c t .a s s r r c h . r r
rhr' t
iup If
.1nt B. OUALIFICATIONS.
c. FowERSANOFUilCnOHS.
_Tlre $upreme Court erptsincd in Inbr-Arient Maritime &n"tetpriw, Ine,
et al. u. court of Appeals' that "the captain of a vesael is a confidantial and
managerial employr* within the meaning of thc above doctrine. A mastcr or
captain, for purposesof maritime commerre,is one who has command of a vees€l.
A-captain commonly perforrns three (li) distinct rulcs; {1)he is a general agent
of the shipowner; (2) he is also commanderand technicardirector of tle vdsel;
and (3) he is a representativeof the country under whose flag he navigates.oi
these roles, by far the most important is the role performedly the ca-ptain as
commanderof the vessel;for such role (which, to our mind, is analogousto that
of "chief Executive oftricerr'tcEol of a present-daycorporateenterpriee)has to
do with the operation and preservation of the vessel during its voyage and the
protection ofthe passengerg(ifany) and crew and cargo.ln nie *iu * general
agent of the shipowne4 the captain has authonty to sign bills of ladiot,
gooda aboard and deal with the freight earned, ^gr*u ,rpon rates and ""rry
decid;
whether to take cargo.The ship captain, aa agent ofthe shipowner,haa legal
authority to enter into contracts with respect tn the vesgeland the-tradinfof
the vessel,subject to applicable limitations establishedby statute, contrac{ or
instructions and regulations of the shipowner.To the captain ie committed the
governance,care and management of the vessei.clearly, the captain is
vest*d
with both m&nagrlmentund fiducirrryfunt:tiorrs.',
In thie connection,the Codeof Cornmerceprovidesfor the following powers
and obligationsof the captain nr master as well as lhe procedurefor the exereiee
thereof:
uNo.1162S,August11,1994,
2BSSCRA262.
* Mriiirtuirrllflglmrifrfdl,rirr*riiFrr*,uo,iu**de$i5,*idl8*Srt
"g*i.-'*.',
.H
I MAlil'l'lMElnw
Wlrl'l'rtkrltrrrtrrrMlrrtrnte(lttnrnlon:o
!tr.rxrttrr
618
$
i
9. Tb take the neceecnrSrntepe lx,fore the competent autbority
ln order to record in the certlfiesta of {he veacel in ttre regietry of
I veee€le the obligatione which he mey eontract in accordance with
Article 68{}.
tT
I 10. To place under good eare and cuetody all the papere and
i
i
belonginge of any mernbera of the crew who might die onthc veaeetn
drawing up a detailetl invcntory-. in the preaence of peoeengemr orr
in their absence, of members of the crew aa witneeeei.
ll. To eonduct himrolf net:ording l,o ths nuler nnd proeoSrtn
contllnod In thr Inrtnrctlonr of thr. *hlp ngoni., being ll*ble for rll
that whieh he nay do in violstion theneof.
.12. To inform the ship agent frorn the port at which the vees€l
arrivea, of the r€aaon of hie arrival, taking advrntage of the
eemaphorc, telegraph, mail, etc,; as the case !!rsy be; to notify him of
the cargo hei may have received, atating the namea and doniciios of
the shippets, beightage earned, and amounts borrowed on botfomqr
loan; to advise him of hie doperturc, and of nny operation nnd dats
*"hich may be of interest to him.
616 N(yIES ANP CASESOH 1X{S T,AWON TRANSTORTANON
AND PIJSLIC UTIIJ?TSS
trlntll'(]rirn!,
lll*ritirnt F n f r , r p r i s n , : i,n, r ' . r ' .f l r r r r l r , f A p p r . l r i g ,/ , \ r r f "
tnthid.
'5f6i.t.
ld
MARITIMEI..AW 6l?
FereonsWhoTbke Part in Mgritiloe Commerce
ftl ll )ll The word "necessitlr"when applied to mercantile affaire, where the
)lli('l it
jutlgnrentrnust in the nature of things lxr cxt:rcised,cannot,of couree,mean
ef ! I(|Il
an irresistible coarpelling power. \{?rat is mean! b.vit in such casesi8 the
firrceof circumntanceswhich detcrntine lhc cour!+c a man ought to take Thus,
0l llrr'
where by the force of circumetances, a man has the duty cast upon him of
nr'lf lt)
taking some action for another, and under that r:bligation adopts & course
it t' ttt
which, to the judgmenl of a wise and prudent man, ia apparently the begtfor
r n .i h e the intereet of the personsfor whom he acis in a given emelgency'it may
[lrrl lt properly be naid ol the coureeso takt.n thnt it wus in a mercaniile ssnsc
. necegsaryto take it."
!
*
f
r"No 1O988,March 31, lSl?, 36 Irhil. 51X),otcd in Inter-Orient Maritime Entarprieea,et ol.
v NLRI:. i6!d
t7IbkI., aa citrd in Inter-Orient Maritime Enterpriaes v. NI,RC.
618 NfTTESANDCASNSONTHA LIW ON TRANSI,(}NTAfiON
AND PLtsUC IJTIUTIES
"But it ie clear that the maet€r c,uld not be required to act on the veql
day of hie arrival; or before he had a reaeonabreopportunity to asertair
whether he could hope to carry our his contract und er* his freight; and
that he should not be held reeponsible for a reaeonabledelay incident to an
effort to aecertain the wishee of the freighter, and upon f*lum to securs
prompt advice, [o decidr for himnelf as to tho cource which he uhould odopt
to secure the interests of the abeent owner of the property aboarrdtlte veesel.
The rnaerer is entitled tr"rdelay for such a peri.d a8 may be reasonable
under the circumatances, before deeiding on the courge he will adopt. He
may claim a fair opportunity of carryi'g our a contract, and earning the
freight, whether by repairing or trarrshipping.should the repaii of the ahip
be undertaken, it must be proceeded with diligently; and if so done, tle
freighter will have n' ground of complaint, altnougtr-the coneequentdetay
be a long one, urless, indeed, the cargo is perishable, and liLely to be injured
by the delay. where that ia the case, it ought to be forwarded, or sold, or
given up, ae the caaonrny be, wilhout wniting firr repair*,
E. PILOTAGE.
A pilot, in maritime law is a personduly quarified,and licensed,to conduct
a veeselinto or out of ports, or in certain waters. In a broad sen-se,the term
"pilot" includesboth: (1) those whoseduty it is to guide vesseleinto or out of
portg, or in particular watera, and (2.1those entrust€d with the navigation
of
vesaelnon the high senr.Howervcqlhr: ttrnr "pilot" ii lnorc genernlly underntrxrd
tltlll p{rrFolllrtktn ort lxrrlrrlrrl rr lrrrll,rcrrlirr'
plrrt,r,
lirr t.lrllrrlrlx)s{!
of *rneluctinga
-
nhip through a rivcl.,road ur channel,or.{ioln a porl,.rx
states possessingharbors have enacted laws or promulgated rules
requiring vesselsapproachingtheir ports to take on board pilots liceneedunder
thelocallawl9Thisisknownascompulsorypilotage.
In this jurindiction,compulsorypilotageis beingimplementedin the port
of Manila.m The Port of Manila is within tlrc Manila Pilotage District which ie
r8FarEaetern Shipping
Co. v. Court ofAppeals, No. 11006g,October l, lggS.
r'?0 Am. Jur. 2d 526.
?oFarllastern Shipping
Co. r,.Court of Appczrl.s.
supra.
's
Ports
under compulsory pilotage purtiuant ftt Ser tiott fJ.Artrcle tll of Philippine
.l? that: l
Authont-v Administrative order No. 03-1J5, which provides
or anchorvessers
par.XLIV._ pilots,i,^' o.,,iirJrna ,ui*tvsecure
und(.r thcir e()ntrol when rr,qrl{r.rtr..tlto rlo so l)y tlt(r ntaritcr of such vessels'
620 NCIIESA}IDCASE$OilTHEIAWONIRANSFORTATTON
ANDPTJBL'C
t-rilLTTIES
tingluh andArnericanauthoritiea,generalry-speaking,
,.o""$?ter t^hepilot
th",r,ip,,
J '':ffJf;'ffff :#tr;l:llffii''gil:#*;TJi
navigation. He becomeethe
masterpJ iic uice and should give
aa io npeed,course,-stopping all d.irections
and ;";;;g, anchoring, towing and the like.
And when a licensed.pilli i,
it is his dutv to insiston h"rid;i;;i""
".pf"y_alrr?pf"*.'.f,ere pilotage ie compulaory
*rrt of of rhe vegeel,or to decline
act ae pilot' under certnin to
ry"ut"-r or rnreign raw, the pirot
entire charge of'the veaeel, .'er not take
uut i" JL*"d m"r*ly the advieer
rchoretaine command oitt e ma"tar,
pilotage in conrpuleory. ""a'*ir*rlil#invrgatiun even in rocaritioawhor*
rt&d
ilr'
pers<,n;: 028
,u'nrrll$f'if#S,,"* c,rnurerct
uIbi.d.
6lbid..
rnl*ffih"
perrone 6lt
*"ffiffi.. commere
pcrs,ns
whr'ffi,tJlT:tffiinrr: .,r,rn*rc, 627
.
l b r u p p r o v a l b y t h e ( i e r r r , r : r lr l r a r r r i g * r, ! r r r e A u t l r o r i r y .
. anrendmentsthereto subsequeot
shall likewise lle subuiittecifor apprcval.
SEC. 25. Indemnity Insuranteand Resert,efund __
a) Each Pilot.,l'Ass<leiation
shall cullectivel_r.
insure its nrembership
at the rale of P50,000,o0eachmember to crver i' whore'r in part
ani liabilify
arising frorn any accidentresulting in clar'ageto vessel(s), port
faciitiee and
other properties and./orir{ury to purron. oideath which'any
*u*L, *ry
lrave csused in lhe c,ourseof hic perfirnnunce of pilotage
dutier. . . .
b) The Pilotage Association shair tikewise aet up and maintain
a
reaerve fund which shalr answer for any part of the
liability *i""*a t" i"
the immediately preceding paragraph which is reft unsstiafied
by the
ingurance proceeds,in the following manner:
xxx
5) If payment is nlade frorn the re.servefund'f an Association
on account of damage caused hy a niember thereof who
ie f'und.at
fault, he shall reimburr*ethe Assr,"i,ti'n in the anrount,ao paid
as a(*,n
a'rpracticable;and f,r this purprse,nor ressthan twenty-fiveper
centurn
t2lt'At of his dividendshall rxl rrrt;rincdt,;rr:lr lnrrrrrlruntil thc full rrrn,runt
IrrrN l x l r r r c l . u r r r r ,t tol t l r r . r r . s r , r r , , . h r r r r r . ' r ' l r r , rtrl.rrrr.fpl ri l.,rr,t
ilrvulued
s h n l l l r c e n t i t l e dt o h i s f u l l d i v i d tn d .
6) whcl the reimbursenrent. has rreencompleLed as prescribed
in the precedingparagraph, the ten per cent unt l rovd and,the
interest
w i t h h e l d f r o m t h e s h a r e so f ' t h e o t h e r p i r o t s i ^ a c c o r d a n c e
with
paragraph(4t hereofshall be rerturncdto t-hem.
noteworthy, did not Btsrf the factual barin on which it anchored ite finding
that Gavino was the enrpleiyeeof MI)A. We sre in accord with MPA! p6e.
cas€ law teaches ug tbet, for an employer-employeerelatioaship to exirt,
(1) eslection
the conlluence of the following elements must b€ eatablished:
and engagenrentof eo.pl"yc'es; (21 the payment of wages; (3) the power of
aismis8al (4) the employerrspor*'erlo control the employeeawith resPgctto
(Ruga vsrsus
the means and method by which the work ie to be performed
NLRC, r8r SCRA 266).
oftbe
onArticle21.80
Theriabilityof MpAro,dr*"go.*iJrlo,ur,"noruu
Ncw Civil Cod* ar ernrneously firrrnd ilnr! rtet:lared by the court a quo but
under the pnovisionsof custoDs Adminietrative order No. 1646, tupm,in
tandem wiih the by-laws of the MPA'"
There being no employer-employee relationship, clearly Article 2180
108 of the Civil Code is inlpp[cable since there ie no rricarious liability of an
employer to epeak of. It ig eo stated in AInr."ricanlaw, ae followe:
The well-established rule ie that pilot associationg are i mune to
vicarious liability fOr the tort of tlreir membere. They are not the employer of
their membem and ererciee no coutrol over them once they take the helm of
the veasel. firey aru also not partnerahipo becaua€ the members do not
function 8t agp;ts for the association or for each other. Filots'astocistiool
are also not li"ble fot negtigently aesuring the competence of their meEbGrs
becaus€ ar profeseionsl sssociationr they made no guarantee of the
pmfeaaional conduct of their member€ to the generd public'
where under tocal rtatutes and regrrlationa, pilot aaoociationalack the
neoessary legal incidente nfrreponsibility, they have boen held not liablo for
danages;used by the default of a member pilot. Whether or not the mambere
of a pilof'ae$ciation are in legal effect a co-partnership dependr wholly on
tbe powers and duties of the membere in relation to one anotber under t'he
pruvisiona of the governing atahrtee and regulationa. The relation of a pilot
L hig aggocittisn ia not that of a eervant to the maeter, but of an associate
aeeieting aad participating in a oorlmon purpose. ultimately, tle rights and
liabilities between a pilots'association and an individuel member depend
larFly upon the *nrtii ttion, articles or by-lawa of the essociation, aubject
to appropriate government regulations.
No relianc.e can be placed by MPA on the cited American rulingr as to
immunity frorn liabiliry of a pilots' as8{riation in light of eristing poeitivg
teg,tt"Uo" under Philippine law. The Court of Appeale proPer! lPplied the
clear and unequivocal provisions of custome Adminietrstive ol.der No. 16'
65. In doing so,it ras just being consirtent s'ith its finding of the nonsistenm
of employJr-employee relatioiehip between MPA and Capt' Gavino which
precludes the application of Article 2180 of the Civil Ccde'"
F. ON CAPTAINS.
CODEOF CONMERCEPROVISIOHS
AR,llcLE613.Acaptelnwhonavlgatesforfretghtlnconnon
or oa ahares rney not ^.k. .rry eeparate transactioa for hlr 6ga
accoun$ and should he do thu proftt whlch nay accnre lhdl
"o,
d penuona
*," rHtJlH#urne commerce
and defenae of the flsmer ll he drpn not prove that he made tlrnely
uco of all hlr authority to.prevent or avoid them.
6. Iror thoro cau*ed by tho miru*t-'of tho poworr nnd the non'
fulflllment of the obligationr pertalning to him in accordance wltb
Ar-tlclea 810 and 812.
8. Forthose arieing by reaeon ofhie going out ofhis cour&e
or takinga coure€ which he ehould not have taken without cuficient
caurrc, in the oplnion of the 6fllcere of ihe veeeel, at a meeting with
the ehippere or super'eargo€s who rnay be on board
No oxcoptlons shrtto{'lvsr *hrll ornmpt hlm from thir
obligation.
7, l-or those ariring by reaeon of hir voluntarily entaring a
port other than that of hic deatinstion' outgide of the caa€s or without
the fomalitiee referred to in Article 612.
8. For thoee arieing by reaeon of noa'obeervance of the
proviaione contained in the regulationa on situation of lighta and
maneuvers for the purpose of pneventing collisione.
ARTTCLE 619. The eaptain ehalt tre liable for the caralo from
tho time it in dollverecl to him at thei dock or afloat alongrido the
vosrct at tho port of loadlng, until ho dclivenr it on th{, shoro or on
the diachnrging whar{ at the port of unloading, unleae the eontrary
hsc been expreeely agreed upon.
ARTICLE 820. The captein sball not be liable for the damages
caueed to the ve$€l or to the cargo by force mqieure; but he ahall
alwrye be so for thos€ ariBing through his own faull no agrrmnaent
to the conb?ry being valid.
Nelther ghall be be pereonally liable for the otrligatlone he may
have contracted for the repair, eguipment, and proviaioning of the
velrelo whlch rhdl dcvolvo upon the rhlp egent, unlcer t:Le formor
har orprocely bound hinr"elf pereonally or hag eiSned a blll of
erehango or prornlerorT noto ln hlr nane.
ARTICLE 821. A cnptaia who bonows money on the buJt, engine,
riggfurg or tackle of the vetoeln or pledgee or eells merchandige or
provisione outeide of the cas€s a.ud without the formditie pneecribed
in thie Code, ahall be liable for the principal, intereete, and coete,
and ehall iademnify for the damagee he may cause.
He who comnlta baud ln hie accounta chdl pay tho asouat
delbauded and chdl be ar.rbject to the provisions olths Pend Code,
ARTICLE &l& lf rhilc on e Yolrrg€ the captnia ehould ltlrn of
t:|o appoaranco of privateers or mer of war againct bis n88' he ahall
bo obliged to mahe the neareet aeutral port, infom hie ageut or
abippera, and await an occagion to sail under eonrtoy' or until the
dnnger it over or he has received expr'esa otders fbom the rhlp agent
or the ehipperr.
ARIICLE frAS.If he ehould be attaeked by a privateen al4 alter
havingHed to avoid tbe encounter andhavlngrosleted the delivoty
fi ,,.r-
q
a8t
r\rr,r,rrg
wrr..S:frLlT,l'rl#rme
commerce
of tbe effects of the
leccel or ite cargo, they ebould be forcibly talGn
away from him' or he rhould be obtiged to deliver then".he
rbell
F*r entrT thereof ia hie fleight u"** pn"vc ln" t"rt
bcfore "lthe competont authority firet "ra
port "nnu
ha to-uchec.-
"ith.
- l&r the for.ee m4jeurc haa been proved, he rhcll be erenptod
fhorn llrbility.
ARTICLA 8l.4. A ehptnln whoro vemcl hu
fonr throngb r
hunlerno or who bollevor thrt iho carfo hrr ru|tJrsd
{smrf,cr or
lvcragar, rhrll mnlo n proteat therion belore tbe eonpeicn3
ruthorlty at thc ftnt port he touchac, wlthin twcnty.four'hou'
following hir arrlvel and aball ratify lt withirr the same'pe*oa
wleu
he arrlvee at htc derttnstlon, I'nr-sdiately proeoeding Titf thc proof
of the frete, and he a*y not open the hatchee until ctt€r
thir r,ri
been dono.
Tbe cspreln lhall procecd ln the .arn€ merner, lf' the vsmel
- .
hevlng bccn rracle4 ho ir caved alone or with part of hb crrer, ln
pblcb cals bo rhdl eppear before
the nearort uoihortty, and n .kc r
lworr rtatorncrtt o? facta.
The authorlty or the coasul ehalr verify the said facto reeciving
cworn etst€mentr of the menbenc of the crew and pnr*engera
who
I may have been save4 e.nd totring such other etepe ie -"i""oi"t
i"
f arriving at the faetc he ehall make a atat€ment of the rsrurt
of tbe
proceedinge in the log book and in that of the eailing
matc, and shell
deliver-totbeeaptain the originat record of the prdding;,;;p.d
t and folioed, with a memorandum of the frrrior, whic-h he mugt
il
rubrical'e, in order that it rnay Lrepresented to the judgo or
i eourt of
the port of destination.
The atatomcut of tho captnin rhafi be accepted if it is
v itr
sccordance with thos€ of the crew and paaa€ngerE; ilthey din3ree,
e
the lntter shall b€ accepted, alwaye proof to the clntrary.
r ""yiog
rf ARTICLE 625. The captsin, ,'nder his persona! reoponsibility
sr a(x)n ae he at?ivec st tbe port of destination, sho;ld get the
neceaaery permisaion from the health aad cuetoma ofticem,
and
perform the other formaritios required by the regulations
rf of the
.d adminiotration, delivoring the without any defateation, to rhe
coneiqe.e, and in I pnop€r case, "n the
"f., veaselo
a, riggrng, and froightage
to the ehip agenL
tr 31T1iisparagraph war
already repealed by rhe Oode of Civil Pr6edure and the Rulee of
F' Court, Nolledo,Codeof Comrnerce of thz philippint:t, Annotated,l9g9 Ed., p. Sl.
i 6:t3
PROBLEM9:
NOIES Ar.lD CTLCES
ON THD l.AW ON TRANSPOffiAflON
ANDPUBLICUTILTruS
A The suit will succeedagainst the captain but not against X The
captain ia liable becauee his negligence caused the damage or injury. On the
other hand, the barcboat chartprer becomee the owner pro hac uite, hence,
he is responeible for the acts of his captain. The shipowner is not liable because
. the contract ig between the bareboat charterer and Y. The ahip owner wae
neither a party to the contract for the ahipment of the goodenor an ernployer
of the ship captain. (1989)
2) X ch&rtered the ship of Y to transporl his logs from Zanboanga
to Manila. In the coluse of their voyage, the ship met a Btorm and had to
dock in Cebu for three daye. Z, the captain of the ship borrowed P 20,000.00
. from X on the pretert that he would need the money for the repair of the
ehip. Z miaappropriated the money and converted it to hir on'n trenefit. What
ia the liability of X if any?
A: Mr. Y iE not liable. Under Article 586 of the Code a shipowner
would only be liable for contracle made by the captain (a) whon duly
euthorized or (b) evon when unauthorized, for ship repaira, or for quipping
or prorisioning the vegse'lwhcn the proceedsare invested therein. The loan
by tho captain from X doec not fall under any of thc f<rregoingcaeoc.( 1989)
CASE:
UANUTMEI,AW 633
hrmas Whot*e hrt in Msritigp Commerce
On 29 July 1989, while the vees€l waE en route to Singapore, Captain Tapng
reported that the vessel had stopp€d in mid-ocean for aix t6) houra and forty-fivo (,[6)
minut€t due to a leaking sconomizer.He was insl.mcted to ahut down ths eoonomizcr
. and us€ fls 6rrvilisy boiler inrtasd.
On .91July t98$ at060? hre., tlre vonrelnrrivod ut,tho pnrt of Singapor*;Thc Chiof
Eng{neer rrminded captaln lbyong that the orygen and acetylene auppliec hrd nct
been delivercd. Captein hyons inquired hom the ship'a agent in Singapore sbout the
zupplies. 'lhe ship agent stated that tieae could only be delivered at O80Ohours on
Auguet l, 1989 ae tbe ator€s had cloeed.
Captain Tayong called the ehipowner,Sea Hors€ Ship Management, Ltd., in London
and iuformed them thlt the departure of the veeE€l for South Africa may be afiected
becaue€nfthe delay in the delivery ofthe euppliee.
Sea Horce advieed Captain Thyong to contact its Technicsl Director, Mr. Clarh,
who was in Tokyo and who could provide a eolution f<rrthe eupply of eaid orygen and
acetylono.
On the night of 3l Juty 1989, Mr. Clark received a catl from Captain Tayong
informing him that the veasel cannot aail withorrt the orygen and acetylene for eafety
rcaeonedue to the probleme witb the turbo charger and economizer.Mr. Clark reeponded
that by shutting offthe water to the turbo chargere and using the auriliary boiler, ther.,e
should be no further pmblemn. Aceording to Mr. Clark, captain Tayong asreed with hisr
that the veeselcou-ldsail as echeduledon 0100 hours on l August 1989 for South Africa.
According to Captain Tayong, however, he communicated to $ea Horso hie
reservations regarding proceeding to South Africa without the requested euppliea, end
waa advised by Sea'Horse to wait for the auppliea at 08o0 hra. of I August 1989, which
Sea Horse had arranged to be delivered on board the aceanic Mindorp.At 0800 boure on
1du8uet 1989, the requisitioned euppliee were delivered and Captain Thyong immediately
:r uith eailcd for Richard Bay.
nqtt hv
'r1t.lnc.
When the vessel arrived at the port of Richard Bay, South Africa on 16 August
1989, Captain Tayong wae instruct€d to turo-over his poat to the new csptain. He was
scl l{Ir' thereafter repatriated to the Philippines, alter seruing petitioners for a littlc more than
ontract. two weeke.He was not inforured of the charges againet him.
, port of
r\\ith !o On 5 October 1989, Captain Tayong irrstituted a complaint for iilegal di$misral
before tlre Philippine overseas Employment Adminisiration ("POEf), qlniming trir
unpaid salary for the unexpired portion of the writtcn employment ontraet, plur
iloading attorney's fees.
Gordon"
*rfcrY of . Petitioners, in their anawer to the complaint, denied ttrat they had illegaly
lcrrkrng dicrniesed Captain Tayong. Fetitionera alleged that he hnd refueed to as.il immodiatoly
to South Africa to the prejudice and damage of petitionera. Accordiag to petitionera, as a
direct result of Captain Tayong,edelay, petitioners' veseel waa placed'off-hire" by the
D.t{ NOTE$AND CASUSONTHE I.AW ONTfIANSPORTATION
ANN PUET,TCUTILITIT:S
chart*rers for twelve ( 12)hour:s.Thie meant lhat ihe charterera refuaedto pay the chartrr
-us$ts,goo.oo,
hire of compensstion cnmeapondingto twetve { 12) hours, amounting to
due to time loet in the voyage. They stated that they had dismiesed
i;vate reepondeni
for loss of trugt and confidence.
The POEA dismiseed Captain Tayong's complaint and held that there wae valid
eaue€for hie untimely repatriation. The decisionof lne fOea placed considerableweight
on petitioners' assettion that all the time lost as a resull of the delay was causedby
captain Tayong and that hie coneernfor the oxygen and acetylene was not !egiti;;;
thesorupplirf8were not necersnnn'rlr indirprrrrrrl,l,,t,t,r,uni,rg lhe vonn*|.Tho ITTOEA
lxrliovt'tl Ilrul tlle t)ap[*irl ltutl urrrr.ulorrlbly rclirur,dto fuljow the inalruetione
of
pt'tiliunerrrrrtrdtheir reprusentrt.ive. derpik ;xrtit.ioncrs'firmnssurancen that the vessel
wa$ seuworth.ylor tlrc voyngetri Sorrt,hfurica.
On appeal.the Notionsl l.nlxrr fu,lttions Conrmission("NLRC")reversedand cet
aside the.decisionof the POEA. Thrr NLRC found that captain Tayong had not been
offtrrdtcl nn opportunity to be henrd rurd t,lrat no substtlrtial evrdenceiag adduced'to
establiah the ba*is for petitionere' ioss of trust or confidence in the Captain" The NLRC
declanedthat he had only acted in accordancewith his duties to maintain the
seaworthinees of the vess€l and to ineure the safety of the ship and the crew.The NLBC
directs'dpetitionern to pay the flnptain {a) hin r,niary f<rrthe uncxpirod yrrtion of the
('.ltltrftct nt tls$1,!Xt0.ff) a rnr"rnth,pluu one {l) monl}r leavrl banefii;
and tbt attonrefs
feesequivulent to ten pcrcent ( 10,/r)of the lotal award tlue.
Petitioners, before this Court, claim that the I.ILRC had acted urith grave abuse of
discretion. Petitioners allege that they had adduced eufficient evidenceto establish the
basis f<lrprivate respondent'sdischarge,contrary to the conclusionreachedby the NLRC.
Petitioners insist that Captain Tayong, who must protect the interes1 of petitioners" had
caused them unnecessary damage, and that they, as ownerg of the vessol. cannot be
compelledkl keep in their emplo-va capfain of a vessel in whom they have f"-i ifr"ii
tru$t and confidence. Petitioners finally contend that the award to the Captain of hie
salary correep<lndingto the unexpired Sxrrtionof the contract und one (l) monlh leave
pay,including attorney'e feea,n lro conalituled grave.abuae,f discretion.
I.
The petition mugt fail.
\fc nutt' prclirninarily tlraL peurliilrrersfaileci to atlach a clearly legible, properly
certified, true copy of the decision of the TILRC dated 23 April 1g94, in violation of
requirement no. 3 of RevisedCircular No. i-88. On this ground alone,the petition c6uld
have been dismissed.But the Court chosenot to do so, in view ofthe nature ofqulition
here raised and instead required private respondentto file a comment on the petition.
Capt*in Tayong subrnitled his comment. fhebffice of the tiolicitor General r"kud fo, rn
extension of thirty t30t days to file ilq cornment on behalf of the NLRC. We eonsider that
the solicitor General'scomment,may be disi:cneedwith in thie case.
It is *'eil-settled in this jurisdiction that confidential and managerial employees
csnnot be arbitrarily dismissed at any time, and without ca,r*u* ou*naUly estaltiaheA
in an appropriate inveatigation. Such employees,too, are entitled to security oftenure,
fair standards of employment and the protection of labor,laws.
The captain of a vessel is a confidential and managerial employee within the
meaning of the above doctrine. A maeter or captain, for po.po** of maritime comuierce,
is one who hae command of a veesel"A captain commonly performa three
{B) d1stin61
roles: (1) he ie a general agent of the ahipowner; (2) he is ^iro and technical
"o*-"oder
director ofthe vessel; and (3) he is a representative ofthe country under whose IIag he
F
4
i 'ersone
wh",r5.ll,lflTl'JfI,,,,.,
comrnrrce ss'
aavlgtrl€8' 01 these roles, by far the rnost
imporkrnt is the role performed by the
as commanderof the vess€l;for euch captain
role iwhich, t<.rr.rurmind, is analogoua
"chief Executive ofcer" tcEor to t"hai of
a p.e"*nt-a"y co.grr"t hae to do with
the operation and preservationofthe -of
veeeelduring ils voyage "rrilrpriae]
and the protection ofthe
pa's€nser8 rifanv) *:r ca1ro.
T9 eign1L{ In hisrore; r;'#i;;;i ortheehipnwner, the
captain han authorityto billa nrLdirrr{, errrrygrxrdx*txurrjirnd
pRrrred,anroerp{,n.raton dcal with the froight
nherdecidewhettor to t'kr ,,r,rgu.?.lr*
tlre ehipowner, has legat autlrority uiip eaptain,ae ageni of
r" irrt" contracte with reapec.tlo the vees€l
thetradinsoftheve-eser, subjecmi "nt".
,oJt*ur- and
or instructions and reguralions
rirri;;i;;-i"ui*i?a byotarure, conrracr
ir," *hiporrr.,u..To the captain is committ€d
governance'care and management"r the
of the veeEel"clearly, trt" ."it"l" ie veet€d
management and fi duciary functions. with both
on its way to Singapore becaue€of ite leaking ecunomizer.Equally retevant is the tater
dated 2 Auguet lg89 aent by Captain Tayong to sea Horae after &aanic afuyinoral.urd
leff' Singapore and wae en routs'to South Africa. tn thia teler, Captain lbyong crplained
his decision to Sea Hnrse in tfie following terme:
SWEET |JNBS,lNC. v.
THE HONONABI^E COUFT OF APPEALS, ET AI-
G.R. No, I-{8IH0, Aprtl 28, lg8{t.
For haviag by-peseed a port of calt without previous notice, petitioner shipping
comPany and the ship captain were gued for rlamages by four of its passengers,private
reepondentohereia, befor.ethe then court of First Inatance of cebu, Branch vlu.
Briefly, the facts of record show tlat private respondente purchaeed first-class
tichets from petitioner at the lattey's ofhce in Cebu City. They were to board petitionerrs
M,{}il'f'lMl] t/\w 68?
PergonsWho Take.Part in llaritimn (iomnrerce
ve share ,q The cmcial factor t}ren ie the exiet€nce of a fortuitotrs event or/ore m4jewz Witbort
f
ri
it, the right to damagee and indernnity exists against a captain who fails to fulfiU his'
undertaking or where the intern-rption has been caueedby the captain erclueively.
deii,jei1
*stlillat€
As found by both Courts below, there was no fortuitous event or faw nqjewu
ung thrrt which prtvented the vess€l Fom fulfilling ita undertaking of taking private respondente
not io tre to Catbalogan. In the 6ret place, mechanical defects in the carrier are not considered a
rndor hia cw fartuito tlat exempie the carrier from reeponeibility.
In the s€condplace, even grantingarguznd.a that the engine fsilure wae e fortuitous
!iscretion cilent, it accountedonly for the delay in departure. When the veee€lfi"ally left the port
lering its of Cebu on July 10, 1972, there wag no longer anyforce majeure that juatified by-paaeing
'merit. a port of call. The vess€l was completely repaired the following day after it was towed
b,ackto Cebu. In fact, aft,er docking at Tacloban City, it left the next day for lvlanila to
complateils vo5'age.
The reason fcrr by-passing the port of Catbalogan, as admitted by petitione/e
General Manager,wae to enable the vesscl to clltch up wilh itg schedulefor the riert
seek. The record aleo diecloeeethat there were 50 paesengereforTacloban compared to
?! pnonengers fnr Catbnlognn,qn rh:rt the Cathaloganphasccouldbe ncrappedwithOut
,r. l autttt' ioo much loss for lhe company.
vIII In defense,petitionercannotreiy on the conditionsin small bold print at the back
,:{tht' trcket rt'rtdirtg.
firsl'clnss
J(,tltionelrs
688 NorEs
ar.rD
*ffilH#rwssy*spoftrArloN
11. The sailing scheduleof the vesselfor which tl-ie ticket was issud
is au\|ect to change without previoue notice. {Exhibit, "l-A")
Hvott nasumtng thnl. thom arndili(rtri ilro xqunrr,tylpgrlicablo Uoi,hc cam at ber,
potitioner did not comply mth the s$mo.It did not cancelthe ticket nor did it rafund the
vttftrarof thl [ickrrtsln privttlt:rtryrrrdr:nta.lk*itlrs, it wls rrotl.]rcvr.a$el'x
s$iling schedulo
that was involved.Private reapondents'complaintis direct€dnot at the delayeddeparture
the ncxt da.vhut nl the b.y-pacningof ()atbalogln, thr,ir dr.ntinrrtion.Had petitioner
rrulrfiedihcm previously,and offered to bnng them to their destination at,ite expenee,or
refunded t,hevalue of the tickete purchared, perhapu,this controversywould not have
arisen.
Furthermore, the condilions relied upon by pctitionercannot prevail overArticles
614 and 698 of the Code of Commerceheretoforequotcd.
'l'ho vttyngttto (lu1$6lq1gon 'inlcrnrptr:tl"
wug |y t.hc capluin upon inctruction of
manngtment. Thrt "internrption" w&s n(,t due to lirrtuii,orrsevcrt or forcemqieure nar Lo
dieability of the vessel. Having been caused by thc captain upon inatruction of
management,the pasaengers'right to indemnity ie evident. The owner of a veeeeland
the ahip agent shall be civilly liable for the acts ofthe captain.
Under Articl e 222Aof ihe Civil Code,moral damagesare j uetly due in breacheeof
contract where the defendant acted fraudulently or in bad faith. tsoth the Trial Court
and the Appellate Coun found that there wae bad faith on the part ofpetitioner in that:
( I t f)cfentlants-nppcllants
did not givr:noticr:to pltinliffa-Hppelleer
as to the changeofschedule ofthe veseel;
(2) Knowing fully well that il would take no less than fifteen hours
to effect the repaira of the damaged engine, defendants-appellants inst€ad
made announcement of assur&nsethat the vesselwould leave within a ehort
period of time, and when plaintiffs-appellees wanted to leave the port and
gaveup the trip, de,fendants-rtppellantn'
rnrprloyeeswould comcand aay,'we
are leaving, already;'
(3) Defendants-appellanta
did not ofTerto refund plaintiffs-appellees'
tickete nor provide them with tranaportat.ion from Tacloban City to
( lrrt lrrrlo,{rr
n.
That finding of bad faith ie binding on u8, since it is not the function of the Court
to rnalyze and review evidence on this point all over agaih, aeide fram the fac'bthat we
fird it faithful 1pths srssning of bad faitb enunciated thue:
Bad faith means a breach of a knswn duty through some motive or interest or
illwill. Self-enrichment or fraternal intereet, and not personal illwill may have been the
motive, but it is malice neverthelesg
MAIIITIME h{W 630
Perrons Whn Take Part in Murrtrlle Conrmerce
The total award of sttrrney's feei of P5,(Xi0.{i{)ix in order considering that the caae
has reached this ?ribunal.
Ineofar as exemplary damages are concerned, although there was bad faith, we
are not inclinecl trr granl them in addition tn mr.rraldarnages. Exernplary danrages cennot
be recoverrd alt u matt€r of right; the cuurt deerd,:s whelher or nrrt they ehould be
adudicatcd. The objective to meet its schr:dub nright have br.en calleri for, but pet,itioner
ahould hnvr. tlrkcn lhe nt.cerrsar.v stt.pr flrrrtlrr: protr:ctrrrrrof itx passerrgeruufider ito
contract of carnage.
III. O F F T C E R SA N D C R E W O F V E S S E L S
on the other hand, Memorandum circular No. 14g issued by the I4ARINA
for domeetic trade specifies the following offrcers:
1. Offlcer means a member of the crew, other than the maater, who
has been designacedas auch national raw or regulation or, in the abaenceof
auch deeignation, by collective agreement or cusiom.
2. Mailer riroons th.epereon having command of a ahip.
3. Chbf Mate meanfian offrcernext in rank to the maeter and upon
whom the commaud of a ship will fall in the event of the incapacity of-tbe
Mast€r.
4' Decholftcer means an offrcer quarified in accordancewith the
provisionsof Chaptrr II of the Convenrion.
5' chief Engincer officer meansa senior engrneerofficer reaponeibre
for the mechanical pmpulaion and tle operation and maintenance of t^he
mechanical and electricai inetallations of the ship.
6, Secrrnr/fnglnc tr \fft,.trm(.u1lH tlrc errgirrterolTicornert-in-rank
to the chief Engineer and up.n whorn the reuponsibilityfor rhe mechanical
propuleion and the operation and mainlenance .of the mechanical and
electrical installation ofthe ship will fall in the event ofthe incapacity ofthe
Chief Engrneer.
7. Engineer officer meanr{'ano{Ticerrluarificd in accordancewith
tlre provioioneofchapter III ofthe Convention.
8. Medical Practitianer rnrrins a rcgistcrcd l)octor of Modicine in'
charge of the med,icaldepartment of a nhip.
fl. Rnrt&r(lffivr rrr$fipgo [x,ru{}r lrrlrlrrrgnrr rrp;rro;rrirtocertificate
lrld and rocognizedby the Admi*isrration under ihe piuviaions of the
Radio Regulatione Act.
10. Paramedic are auxiliarymedicar personnet.suchas midwivee,or
nuraes with apecial training on administ€ring first aid.
11. Mojor Potran (MAP) shalr refer to a marine deck officer dury
regiatered and certificated to act as officer or master of veaeevship of no:t
more than 500 GT navigating in the major coastwise trade routea within the
territorial limita of the philippines.
12. Minor Patron (MIp) s]:all refer to a marine deck ofiicor duly
regietered and certificat€d to act ag oflicer ,r master of vesoeuehip of not
mone than 250 GT navigating within a specified body of water in the minor
coastwise trade routes in the philippines.
13. Boot captain rneans a person authorized by the Adurinietration {
to act aa officerr and/or in commandof a boaushipor the qualificationricense I
i
to act as euch. r
1
14. Marine DieselMeehanic iMrlM) means a person authorized by
the Adminintrntionto openrt,eand maintain lhc ship'sdieselenginey'e
or the
qualification/licenee to act ae guch. l
I
t
$
i
l'.
ia:
.i
MARLIIMUI-AW
FersonnWhrlTnke Part in M$ritrrno Llomqrercc
A, REGULANONOF MERCHAHTMARINEPROFESS|oN.
'lhe practice
of marine prr,rfe*sionis now governed by special lawg and
pertinent mlee issued hy the Maritirne Industry Authority and the Board of
Marine Deck officers &nd Board of Marine Engineer officers.In particular,the
?hilippine Merchant Marine o{ficers Act of 1gg8" whs paesed in order to
regulate Merchant Marini Professionin the Philippines.
The law declaree that it is'the poliry of the state to pmmote and insurs
the safety of life and property at aca,prot*ct and sr:ryethe marine environment
t and ecology,and prevent marine pollution and accident at s€a by complying
with the standards of Tlaining, Certificarirln anrl watchheeping for Seafarurr
l9?8 (STf,W'78), as amended, to which the Philippinea ia sigrratory.ry tt ia
likewis€ the declared plicy of the State to inetitutionetize radicsl ehnngss as
.t
I
required by intemational and national etandards to insure that only qualifio4
j
compet€nt and globally competitive Marine Deckl8ngineer officers as
e detcrnined thmugh licensure exgminations ahall be allowed entryto the practbe
of the Mercbant Marine profession.s
The same law created the Boa.rdof Marine Deck Oflicers end the Board of
Marine Engineer Officers to implement its provieions.x
some of the pertinent provirione 'f the Act are reprodued hereunder.
I
fV. GenerelProvieions: I
t
1. Se.agoing shipeehail becompletelymannedby Filipino aeafarem.
No foreign offrcoraoball be allowed onboardunleeeapprovodby tbe
Adminictration.
{
2. Magter,officereand ratingsonboardseagoingrhipe ahallbeduly I
qualified, competent,certificated and medically fit in accordancewith tbe *I
t
eristing nrlee on the issuaDceof certificatesand endore€mentsfor eeafarers.
$
3. Seagorngehipsshall have onboardan approvedminimum safe
manning certificate indicating the minimum numbr of o6cers and cr€w
and their corresponding liceneesand qualificationrequiremente.
}TARITIMET.AW
persona Who Take part 616
in Meritime Commerce
they comply wrth the requirernenLtef Part.sjt and ll-l Section h-VlHln
{
ofthe STUW lg78, aa amended: .x
ti
c. Except in nhipnof lirnitcrl qirr,,I thrr.e ffi) wnlch syatem
shall bc urlupted;
d. At cach end of the ship, tltrrr slrouldbc suflicientpersons
to enable them io acceptand effectivety-.ecurea tug and to send away
tnnsion and Eecurelines and backsprings.Any necesearyoperation
should be capable of being performed at bow and etem simultaneously;
e. The engineering watch should consist of not less the one
( 1) duly qualified engineer officer and may include appropriate engine-
rrx.rmratings providedlhat tlrey cornplywith the retluiremenleof Parts
3 and 3-2, Section A-VIlyZ of the STL]W 19?g,as amended;
l. I n d e x i g n i r l r n gt l l c r r u l n l r c ro t p c r s u r r n eal e e i g n e dt o
enginccringwatches,nccount, slrtll lx' takon rlf thr_, fr-rllowing:
i. the numlx4 uizeiKW) arrdtype r.rfthe main propulsion
and auxiliary unite over which survcillanccis to trc maintained
and the number of nrachineryripacescontaining theseunits; and
ii. adequacyof internal communieation.
C. powor,n lhrcn (3)
Except in *hipe of linritcd JrroJrrrlricn
w&tch eystem should be adopted;and
h. Thcrc nhouldtrea suflicientnunrlx:rof dcnignat*dporeonnel
availableto ensurethe cleanlinessofnrachineryspaces.
3. The Administration shall issue a nrinimum safe manning
certificate which neede to contain the following information:
a. A clear statement of the Ship's Name, Call Sign, IMO
Number and Offrcial Number, Gross Tonnage, Type of $hip, Fort of
Regiatry,and Kilowatt of the Main Propulsion;
b. A lsble ehowingthe lrunrbersarrtlgradcoof the poruonn*l
required to be carried, togetlrer with any special conditions or other
remarkg."
1. P h i l i p p i n e - r e g i s t e r e ds h i p s l h a l l b c c o m p l e t e l ym a n n e d b y
Filipino offrctrrsnnd rntingr, excoptan uul]rorizedby the Administration.
2. Maet€rc,offrcereand ratingn onboardIrhilippine-regiateredshipe I
ehall be duly qualified, competent,certificated and medicajly fit in accordance :
with these Rules and Regulations.
3. Philippine.regsteredships shall have onboardan approvedsafe :
manning document indicating therein the minimum safe manning'
complement and their correspondinglicensesand qualification requirements.
E
u
.1j
l ' l r c t o t t r lx N * r ' | ! . , i a t ( ,
, . ]t r x l w { . rr' ' : r ltr r r l' r r r r l i r i l r; r r r i p u r s i s pr n a c l r i l i r r i e s
s l t i r l ll r r ' t l r e l r i s i s f i i r d r t * r m i r r i r g t r r r . r r i l r i * . n r
n r a n n r ' g r e q u i r e m e n t . rsn
t h t . r , r r g r n rr,l e p c r r n r e n t .
l ' l s u c l r l n c d r c u lp r a c r r t r . r r e r r n t rp u r a m e d i c s
*hall underg' an
orientation/refresher courscon prrbrichr.art.rr ln rt,ratir.,n trrship nanitatio' to
be coilductedby the lrtralth authorit-v.
'rns
.9'2 such medicarpersor:nelnamrci as ship Hearth officer
sha, be
resp'nsible for ensuring at ail times rhe 'ccessarv
or;;;;L;yg,-r-
andcleanliness. "iona*i"
9.3 Drrringthe v.r.yage,
th* mrdic;rlpractiti'n.r sh;rllrnaintainheallh
record:i'logbtxrks
and supprya'y i*rbrmati'n requiredtly the health authority
as to health conditionson hoarddunng the voyarge.
I
9-4 lhe Master shall make known to
lhe heaith authority,
immediately upon diecovery,any case of iilne's
. which is communicabrein
ntttu* 'r dcath on ir.Rrcr, in trrcrert,, pr'tr:ct
ti rrrc intereet cif the other
p,s$engersand to facirirate rhe crearance
if public health.
of the ship ,"ith;;;
""i*g"ring
l
T
s;.!kM&.*b d,d*x;rl*irlib ixe.{ile;I{".d1sit*sdliisldll]i|slt'
Class 'fonnage
Radio Lieense
A,B over 500 gt one SecondClaee
over 250 g't one Third Clase
C,D,E over l6tl0 gt one SecondClaes
r r v l r l - r { l { )l- { i ( X ) onc Third Clase
C. S F C U R I T YO F T E N U R E .
The Labor Code provrsions apply to ollicers and crew of merchant vessels
engaged in domestic trade or coastwise shipping. Hence, matters concerning
their disntissal or disciplinary action musl lrc rn accordance with provisions of
the Labor Code. For offrcers and crew who are working in foreign vessels who
are involved in overseus_shipping,thr.rc urust he cornpliance with the applicatlle
laws on overseas eryployment as well as regulations issued by the Philippine
Overseas Employ.ment Administration (POBA). For instance, the POEA imposes
standard contract provisions for seafarers employed abroad which include the
following:s
sEffective 2000.
551
Personr
*" rff TTrunH, u,*(tunrn* rce
I D. CODEOF COI'IIERCEPROVISIONS.
a. Sailing Mate.
ARTICI-E S28. ln order to be a eailing mate it ehatl be neeeeeary:
l. To have the qualifications reqtllred by the marine or
navigation lawe or rcgulatione.
2. Not to be tliequalified in accnrdance therewith for the
diecharge of hig duties.
ARTICIJ S2?. The sailing mate, ae the a€cond chief of the vesecl'
and unleea the agent orders otherwise, ehall take tho place of the
captain in casee of ab8€qc8,3iskneaal or death, and ehau then assume
all his lxtwera, dutiee, nnd reeponetbilities.
ARTICLE 628. The eailiag mnte muat provide himself with
chartc of the io which he will navigate with the nsLronomical
"u"r
tablee and instnments for obe€rvation which are in ure and which
rr'! n€c3tcar? for tha dirchargo of hie dutiee, boing ltoble for the
accidents w*ch may erieq by reaeon of hie omieeion in thie negard.
553
pt'rs'nstt n t,hl 1\lli1f ,',f,ll, (r*nrr't'rtr.
" ",,,
ARTICLE 829. The sailing mate shall ;rarticularly and pereon.
ally keep s took, folioed and stamped on all it* pages, denominated
'Binnaelc llook- with n mernorlrrdrrrr lt thr. lrcginning
rtating the
number of ftrlios it contains, signed b.r'thc conrpetent authority, and
g h a l l e n t e r t h o r e i n d a i l y t h e d i s t a r r t : c ,t h e c o u r e e t r a v e l l e d . t h e
variations of the needle, the leew:r1'.the direction and force of the
*"ind, the condition of the atmosphcre and of the sen, the rigging
set, the latitude and longitude observed, the number nf furnace
heated, the steam prenaure, the number of revolutionst and ! nder
the title'incidintc," the maneuvers made. the meeting with other
verlloh, nnd ull the dct.ail* nnrl irrr.irlr.ntr*whiclr may occur during
the voyage.
ARTI(lt.f: 6il0. In orek.r {o r.hnngr"thc courgc and to takc the
one most convenient for a g<xrdvoyage of the vessel, the eailing mate
I ehall come to an agreement with the captain. If the latter ehould
l
object, the sailing mate ehall state to him the proper obs€rvatione in
the preeence of the other oflicers of the sea. If the captain should
J etill insiet on his negative decision, the aailing mate ehall make the
proper protest" eigned by him and by one other omcer. in the log
boolq and ehall obey the captain, who alone shall be reiponsible for
the conaequencea of hin deeirion.
ARTIUL'S 631.'Ihe uailirrg nralc slrirll be reeponeible for all the
damagee caused to the vr:rrel and the cargo by reason of hia
negligence or want of ekill without prejudice to the criminal liability
.1. which may arise, if a felony or misdcme*rnor has treen committed.
of
b" Second Mate and lllarine Engineer.
,II
A R T I C I , E 6 3 2 . ' l " h r ,f t r t l o u ' i n g s l r n l l h e t h c o b l i g t t i o n e o f t h e
second mate:
l. T o w n l c . ho v r . r ' l l r r ' ; r r r . r r . r v r r l i oorfrt h r . l r r r l ln r r d . r i g g i n g o f
tht. veaoel, and to tnkr: churge of the pnrxervation of the t&ckle and
cquipment which make up htr outfit, ouggesting to thc captain {,he
repairs necesaary and the replacement of the goods and implements
which ane rendered uselees and are lnst.
1"
2" To take care that the cargo is r*,ell arranged. keeping the
or
vessel always ready for rnaneuver.
3. 'fo precerlc
orr!cr',disr:ilrline, rnel good service among the
creq requecting the necessary orde.rs and Instructions of the
r:aptain, nnd giving him prompt inf<rrmation of any occuffence irr
whic:h the intorvcntion of hin arrtirority muy be ncce*unry.
4. To a.lsign to each ri$ilor the work hc is to do on board, in
accordance with the inst,ruction received and to see that it is
promptly and accurately carried out.
e. (lrew.
rtil the ABIICLE fr18. U the revocatioa of tbo voysge abould arles hon
r of his .juftcauro lndependent of the will of the ahip agentandchertenerr,
{re, hia and the vossel ehould not have left the port, tbe menbon of the
be first crss rhall bavo no other right thsn to collect the wagee earncd up
aptsin. to the dey on which the revocation took place.
voysge AIITICL$ 0{0" The foltorlng rhdl bo Jurt crurar lor the
nsvocatlon of tbG voyage"
fore or
'rea8on l. A declaratlon of wnr or intordlctlon of comncrc€ rtth tho
'trt with
Ircwor to whos€ territory tbe vees€l was bound.
lciesion
2. Tho blockadc of the port of itc dostinatinn, nrthebreallag
out of an epidemic alter the agreement.
rs t';"r1li,?,Hlt, nrL\lsP(rHrArtoN
rrr)'fl,s ANI) LrAS i
i$'f
I l!t'rsrnr
MARITIMT:I.AW
Whu'l'ukt l'att ttl MnnLittlt: ( itttttttcrctl
559
ARTICL& t;44. A riennoan who fallr sick ah&ll lrot los€ hir right
to waget during the voyage. unlets the eick'necs i* the retult of hil
own f;ulL At any rate, ihe coets of the elt€ndance and cur"e ehall be
defraycd from the comtnon fundn, in the form of I lo&n'
If the sickners should comtr from an ir{ury received in the
eervice or defennr of the vernol, the soaman shnll be attended and
curccl at the erpenre of the common funde deductlng, before any"thing
else, from the proceedn ofthe freightoge the cost ofthe sttendance
and cure.
.uTTICLE G{5. If a .ro8man should die during the voyage, his
heirs r*,ill be given the wages earned and not received aecording to
-
hia contract and the caus€ of hio death, namely
If he died a natural desth and wasengaged oD wsse$ tbstwhich
may hrve been esrmed up to the date of hie death ahall be paid'
If the coatract wac for a fixed sum for the whole voyage' hslf
the amount earned ehall be paid if the e€anen died on the voyage
:|
out, ahd the whole amount if he died on the return voyagle"
t
J And if the contrsct wa$ on sbares and death occurlled after the
t voyage was begun, the heirg shalt b€ pnid the entire portion due the
*.r*rr; but if the lattcr died before the departure of ths vetssl from
the port. the beire shall not be entitled to clsim anything'
:o
Iti If death oeeumed in the defenee of the veneel, the aeaman ahall
n. be considered ae livingn and his heirs thall be pnid, at the end of the
hr' voyage, the full of wager or the integral part of the profits
"-o,rot
whieh moy br: cluo him n* to ot,hcr* of lrlr r:lnrll'
it!
In the 0&rr!em&nner, the r.cflmHn captured while defending the
rc) vrrrnel rhnlt be consldor*d pr+ncnt ilr ar t{) r:qioy thc s&nlo b€nnfit{
tcr as the reet; but ehould he have been captured on acc-ount of
or other accident not related to the serwice, he chall
:11 ""rrlo"rne"e
only receive the wages due up to the day of his capttrre'
ARTICLE 846. The vet$el with her eng:ines' riCSrrS: equipment
ost. and freightage shall he liable for the wages earned by the crew
payment to
!oth engaged*per month or for the trip, the liquidatioa and
rrrls take place between one voyage and the other'
A f t e r a n e w v o y a- pg reehcaesdbi e
negn u n d e r t a k e n ' c r e d i t s o f g u c h k i n d
d lrr pertaining tn the voyage ehall lose their right of
tirttt pre fert'ncre.
f tlrt' ARTICLE64?"Theofficerrandthecrewoftheveeselshaube
ir {'il:
frce from all obligationa if they deem it pnoper, in the follnwingcaree:
ight
'f ihr: l. If, before beginning the voyage, the captain attempte to
waa
inllt r change it, or a naval war with the power to which the vessel
'I'tlt*' destined occura.
flsA's'
2. If a disease should bresk out trnd be officially declared an
epidemic in the port of destination.
:t. lf the vessel chould change owner rrr captair'
NO'IE$A!{U CltSnSONTHE IAW ONTRANSPOR?ATION
AND PI.'BUC UTILITIES
tv. SUPERCARGOES.3:
CI.IARTER
PARTTES
I. DEFINITION
AHD CONCEPT,
rn culter {Phiti.t, Inc. t. surpicto Lines,Inc. etc.,t.a
charter party was
essentiallydefinedas a contractwherebyan e*tire ship,
or someprincipal part
of the said ship, is let by thr.'owner Ihcn,r,ft<,:r mcrchant
or other personfona
specriietlLrrneor use lbr the ccinr,e_yance
of'go<l<is,
in considerationofihe payment
of freight.
The term charter party is taken fr"omcarta partito which
literalry mean'
"divideddocument."Certo purtilo rerf'ers
to llre ancient practiceof writing out
the terms and conditions nf the contract in duplicate on
or" pieceof parchment
and then fividing it down the middre thus providing
each p'"*y ,"ltt a copy.z
The charter contract is often referred to as a form of "mercantile
leaeeofor
it involves a charterer, who is most often a merchant nir**ir
or herself, who
desirento lenncn nhi,por vessclowrredb.vnnol.hcrfor the
transpsrt of hia ot her
guds for cornmercialpurposes.'fhe chnrter rnay aleo
involve the traneportation
of persons from one port to another.j rhe parties thereto
are therefore the
charterer,or charter partli and the shipowner.
The contract undoubtedly arose from the fact that
in the earliegt days of
commerce' not too many merchants owned ships or veagerg
becausg the
acquisition of which entailed considerableexpengeor capitalonln"i,
p"*. firuc,
the charterers, with less cost but with convenience,si*ply
reasedships from
the shipowners for the conveyanceof their goodsfrom
orr'epoirrt or au"tination
to an0the'r,or 0f their own trxrrs{fn.q in rrr<krrto r.rjrnxact in far-away
places, "rrnr**r"u
'rht'srrua[i,'in
ttre carlicst da-vsrs still prevailing today,Hence,the
Maririme Ildustv Authority allows the regrstrationof
merchant'vessels
ccrtarrrc,'rliti'rrs e'en if tlreyare 'rrl; c,' a bareb'at "ra",
chartcr.a
r(l.lt \o.
l j l i l 6 t i , S c p t e n r l r t . ri J ( , !1, 9 g . 9 J, l i r S ( . l K { i ( ) 9 .
r(fhorlr..r.arrd
Gilcs, Shippirtll.latr
' : l l f i l r t n r , ' l ' ( ' . 1 ' h t l r l t l t t t r r ( ' t , u t n, (t tt t. ht t lt l!rtll l. ,nr r I l { }
l l , H l t l t r . r r r r . lr.li r l, ; 1 1U . 2 0 ? , r : r t r r r g l ) r : l V i x n , p .
l ' r . 1 7h t . n . r r r i r l l r . rr r : l i , r r t d t o a r r i l M a r l i n
2{)2.
rMAltlN^
r l t : l \ l o R A N I ) t r I f ( : r R ( : r : r . A l t f , i ( ) r , r : is r . r i r , go f
t ( x 1 3 ,S u , o h a p r . r : r ? .
662 NO'I'ESANO CASESON THI' t".{WON TRAN$PORTATION
AND PUB',I(; TJTILITINS
li
II. DIFFERENTKINDSOF CfIARTERPARTIES,
There are two (2) main categoriesunder which charter parties may fall.
These are: (l) The Bareboat or Demise charter, and (2) contract
of
Affreightmenf.The latter is further subdividedinto (a) Time Charter
and (b)
VrryageCharte,r.
A. BAREBOATCHARTER.
In a bareboator demisecharter,the shiporvnerleasesto the chartererthe
ivhole vessel, transferr.ing to the latter the entire command, possession
and
consequentcontrol over the vessel'snavigation,including the mastel and
the
crew, who thereby becomethe charterer's "servants.'As the shipowner is
not
normallv reqtriredto providr fnr l r:rt,v,', th,: charterer gains ponseasion of the
ve.gsr:l"l)$r'c,"hcllcc,tlre terrn"bareboat."'l'hus, thc chartererbecomesthe owner
"pro har:uic'r,''ol'thcvesselirincehe rnunsthc veirsll wit,h
his own s+rtof magter
ttttllt'r|w, t'lli'r:livcl.y
lrrrcotttitrg
t.hr.owrrt.r
lrrr tlrr vova!{t,or serviceutiputated,
sulrject,howeverto any liabitity frrr darnagesarisingfrom negligence"s
I\ioreover,the bareboatcharterer assumr,srtti a large extent, the eustomary
rights and liabilities of the shiporvnerin relation to ihlrd personswho
may
have dealt with him or with the vessel.In this latter instance,the -"rt".
otihl
vesselis the agent ofthe charterer,and not ofthe shipowner,and therefore,
it is
the charterer or owner pro hac uice,and n.t the generalowner ofthe ves'el,
who is liable ftrr the exPt-'nses of the vo-vage
incluriingthe wagesof the seamen.6
B. CONTRACTOF AFFREIGHTMENT.
In a time charter,the vesseli.sleasedto rhe chartererfor a fixed periodof
time, rvhereasin a voyagecharter,the vesselis leased{br a singleor particular
voyage.In both the time and voyagecharters, which are said to be contracts
of
affnrightmt"nt,thc chartcrerhires the vcssolrrni-y,
cither fitr n clcterminate period
o1'timeor fbr a singleor consecutivevoyage,rvith the shipownerproviding
for
the provisionsof the ship. thc wagssof the mrrsturand crcw,and ihe o"puiru,
for the maintenanceof the vessel.T
ln Litonlua Shipping Company, Inc. u. Nationol Seamen Boarcl,et al.,s
petitioner Litonjua, as the duly appointed local crewing managing
office of
l"i*i"{ shipping corporation which had chartered the I,lv n"no" Bay, was
held liable together with Fairwind for the damages suffered by piivate
respondent candongo who had been unjustly dismissed as a Third Engineer
even before his eontract had lapsed. Candr;rrgoiiacl earlier been hired by the
ve$sel's master as a Third Engineer for a period of twelve monthe. The Court
l-:rll.
predi_cat9dits ruling, among other rnatters, uprrn the ndture of the charterparty
ct uf
that had been entered by Fairwind, which was that of a bareboat or demise
d ttr)
charter. It was obgeryed that:
'lhid
56{ NOTESAND CASASONMIP T,AWONTRANSPORTATION
AND PUBTJCUTILITIE$
Sulpicio Lines, Inc., the Supreme Court characterized the said specieofcharter
p"JV * one which does not affect at all the naturs of the business of Sulpicic
of
Linee,Inc. ae a commoncarrier. consequentll" the rights andresponeibi'lities
from
ownernhip still restttl on fhtl owRor,*rtid tho t:lrartt:rlr wan thereby frmd
any liability to third personsin respectofLhe vessel'
of
The High Court, in so concluding lhereon, relied upon the earlier case
where it held that sincethe parties
PlantersPriucts, Inc. us.Court of Appeol"s,1"
in the charter entered into a tirrre charter-party,the commoncarrier remained
a commoncarrier.
. I t i s t h r , r t . f l r r r , i m l t r r r n t i . u ';tt' l lht irtltr l i t. . l r r ' l . i .rl,rr; t l lr r , n t l r t n : rssu c h .
ur
nr:twithstirrrrlrlglhe charter ol lhtr whole'tr ltr.rrttotlrrl'lr vt,s''iclby ont:
ig linritr"rl t., Llrl shilr only, as in the Case
nrorl p{rrs{(}ns, Jrr6virllrltht.r:hlrrtlr
o l i t l r t , , r r . l r ; r t l t . rv' 0 \f , ! l l l 0 c h r t r l r . r ' l t i : r i l l r l y $ l r l ^ t r l l i I r ' l t : r t ' l 0 r t t r l : l t t d l ' ' { l x r l l r
t h r : v g s x l : rl l r t l r t s c r r w , l t r ri n t t l l i r r r : b l r nutr t l t ' t l l l r i t ' t l r l tilt t ' t t t l t t t t ocr a
l rrttr
becomespnvilte. At leasl insofaras the part itrulil r \'(r.\': tgtr crrvtring thc charter-
party is concernecl.Intlubitabll a ship-o*rrcr in a titlre or voyagecharter
,etains possessionand contr'l of the ship, *lthough her holds.may,for the
moment, be the property <lfthe charterer''
we quote with approval the observdt.iotrs ol'lt:roul {-)olinvaux.the
learn,'tl batrister-at-larl--
'926scRA 476[19931.
ttArt.654,Codeof Commerce.
t2Art. 679, Code of Commerce.
MARITIME I^AW 686
Chartr:rParl.ier
and the subcharterer and thereforc doesnnt give rise to any aontrac'tualrelation
between the general owner and the subcharterer.
Part owners of the vesgelare not precludeclfrom chartering the aarnefor
t"heir own commercial purpos€s. In fact, such part owners eqioy prefereDcein
the charter ,f the veeeel over other pergrrns who offer equal conditione and
li eight.''
In the Codeof Commerce,the ship agent is not allowed to make contractg
for a new charter unlese he is properly or duly authorized by the owner, or by
virtue of an authority given by a resolution of the majority of the coowners. He
may, however, make such charter if the same has been extended to him in hig
certificate of appointrnent.ra
on the other hand, it is one of the inherent powers of the captain or master
of the vessel to enter into valid and binding charter parties, but only in the
cvent of ubserrceof the ship agent or cr.rnxignee, and only if the aaid captain or
mar;teracts in accordancewith the instructions of the agent or owrer and protccts
ttre latter's interests.15
However, the valid.ity of the charter is not affected by the circunstance
that the Captain or master who executed the charter rriolated the orders or
inst.ructiclnsof lhe agent or owner.In fhls latter caee,the agent or owner shall
have a right of action to recover damagesagainst the erring captain or magter.16
1
q
N(}TBSA.}IDOA$DSON THI: I".dWON 1'I$NST'ORTATION
AND P{,IBLICT'TII,ITTES
I
"A chertcr party must be drawn in tluplicate and aigned by the
contracting parties, and when either does not know how or is not
ahle to do ro, by two witne*res at hir rr.qu*rt,
The charter pnrty ehall contain, beriideg the conditions freelv
rtipulatr.d, the followlng ei nrunrrtn nc{!ni
l. The kind, name, tonnage of the vensel"
2. Her flag and port of registry.
g. The nnme, sulr.narne, and domicile of the captain.
4. Tbe name, mrname, and domicile of the ship agent, if the
latter ehould make the charter party.
6. The name, surname, and domicile of the charterer. arld if
he states that he is acting by commisaion that of the percon for whoee
account he makes the eonlrnct.
6. Tbe port of loading and unloading.
7. The capacity, number of tone or weight, or measu.rement
wlic| they respectively bind themselves to load and trane;rcrt, or
whether the charter party ie total.
8. The fteight to be paid, stating whether it is to be a fixed
amount for the voyag€ or so mueh per month, or for tbe apace to be
occupied, or for the weight or mea$urement of the go<dr *aking up
the cargo, or in any other manner whatsoever agreed upon.
tf. Thc nmerrrntof prlmtge to lrrr lxrirl the cuptain.
lo. The daye agr.eed upon for loading and unloading
ll. The lay days and extra lay days to be allowed and the
denunage for each of them to be paid."
VI. FREIGHT.
The parties themselvesnray fix the manner or form in which the.charter
price or money shall be satisfied. In most cases,the compensationto be paid for
sArt. 65"1.(luir'of
Commercc.
|t8fryfitutkdrfiru* afq5*{s&a.8'uF&rltr&ptrn*r*xtrffisnlge**.
I
$
:l MAtrtl'tMEt-AW
Oharler Parl.ios
65?
d In one case, the failure of the captain or master to carry the goodeon his
,e ship or to eendthem to the point ofdestination in another vesselresult€d in the
p abandonmentupon any claim for freight thereon,exceptwhere it has beenmade
pa.vablein advance.?a
VII. DEMURRAGE
AND DEADFREIGHT.
Arricle652tpar'.10r proi'idesthat thc tirrrelor loatlingand unloadingshall
be provided for in the Charter Pafty'.The period so stipulated is what is t<ntiwn
ir.sthe "lay days.'
e t t s eo f
I)emurrage,rn the strict senseof rhr-'l,r,rm, mean8a $um of moneydue by
('rr;corrtractIor lhc dert.ent
('xl,)r ion ol'thr: vt:ssrliir kladingor unloading,beynnd
ttrtrfies the time allowedfor that purposein the chilrter party"f In otherwords, if the
'd in his vesselis detainedbcyondthe numlxrrof tia.!slrgrcedugxlnin the.chartercontract
t cu:ieof for the loadingand unloadingof cargo,or for evenrualsail, the charterer shall
br,rker's answer for the demurrage incurred therebv the sum of which is usually fixed
i()\rever. tr1'the parties in the charter party.rt r
:theless on the other hand, where the charterer faiied to occupythe leasedportion
lged the of the vessel, he may thereby be made liable by lhe shipo*tr"t ior the
-deatlfreighr"
that occurred.??
IArt. 659,
Code of Cornmerce.
r?Art.660, Cbde
of (lomnrlrcr,.
elt rrrtcr i'Art. 661, (lode
of Cornmerce.
pard for racoinpagnie-de
C o m m e r c e v l { a m b r r r g A r r r r , . r i c : rN
, o. togu6, March 31,1917,36 phil. sgO
-?rr Am .lur
2d 1052.
r"'Nalional
F'tmdAuthorit.,v v. Court of Appcals, l} l I SCRA TO0.
t;lhtd.
{
.il
r{5
s;
#
{r
' rlll
I
5bE NOTESAND CASESON THE I.AW ON TRANSPT}Rf,ATION
I
I ANDPUBTIC UNLTNES
,l
'l
I A. COMPT,ITTIrION OF I,AYDAYS.
I
J
In connectionwith demurrage, it has been observedthat unleesthe contrary
intention appears in.the charter party, the stipulatcrl lay days do
n.t begin ti
run ngainst the consigneeuntil the veeselhas arrived nurtt, or other irsual
and customay place for loading or unroading,and is "iin actual readinesa
to
dischargeita cargo in accdrdancewith ite legal obligation.$
i':,lili,ii,T,',i)
first in loading hrs cargc',rrrrdrhc rrt.lrr:rs.sh.ll have preference in the
order of the dates o{' their charter. In the atrsence of priority, the
Y
charterers may choose to load in proportion tq the **or.rrrt" of weight
or space that lhey ma1'have contract*:d, with a right to indemnified
I for the loss.s
(,
4. T h t ' s h i p o w n e r . u r i t l c r c t , r l l r i n c o r r d r t i o n s ,m a y e f f e c t a
substitution in respect of the vessel which had been initially chartered
wrlh t.hat of annther, srr long as Lhr-'substitutc versselhad been dulv
inspected and is seaworthy.$
B. CHARTERER
'fht
rigirts and obligalionsof []rr.,r.hnrtcrc'r
nray be sumnarized as follows:
1. As previouslynoteri,the charturer shall have the right to
sulleltilrtt:rllrc vr:sstlt' a tlrir"dl)crso]l'n11,illre is so authorizedby
the shipowner. otherwise,he shall be liableto rhc shipownerfor any
clunr:rge catrsedto the laltcr by virtue ol'the sutrcharter.s
2. A chartererwho l'ads grxxlsciifrerentfr'm that contracted
upon, without the knowledgeof the shipowner or captain, and which
results to damagedue to confiscation,embargo,detention,and other
causes,to the said shipowner,shall be liabxeto indemnify the parties
injured thereby.3s
PAR'I'I
}.() RIV1SAND }iT' }'E(,:TS O }' C I IA III'F] It PAITTIES
PAIIT 2
RIGHTS AND OBLIGATIONS OF SHIPOWNERS
In the ra[re rn&nner, the captain may, before loaving the por!
unloed ma'chandlro crradortrnery praeod nn bortd, or-tranrpori
thom, lf he can do ro wlth tho vesgeiln trlm, demani*ng
Uy -"y of
fh'eightage the htgbert prrce which mey have beon etipula-tci
r", ora
voyage.
ARTICLE 878. u the vearel hae been chartered to receive
the
in another port, the captain ehall appear before the coneignoe
t*go
derignated in tho charrer party; and, shourd the lottcr
not derivor
the cargo to him, he ehatt inform the eharterer and
walt hic
Inntnrcti'nr, tho lay dnyl agror.d u;xrn 'r th'no allowod
by cuetom
in the p'rt tregtnning to nrn in the meantime, unleaa
thene fu en
(!rproilt, agreemont to tho contrnry.
PART 3
.,. fl,.*,,,.;.:,:::":.::":1,**o",*,
the whole or part thereof
*;h ;; ae he may coneider noct
couvenient the cao'tain "r b"iog.u"*.a
to refur,e t Gi"r o,,
board the freight aluvered "g!bt ahr";;
chantcnere,providod thrt
trre conditlona of the nrct char*er-are
oli *u"ogu, and that tbe price
g1t' upon ir psid ir-full to the bom rrhom the veecel is
chertore4 even thougt **o
!1" n U cargo ig not embarked, with tbe
ll nig31is11estabtich€dln tbu
;i;;.
""xt
ARTICLE {t80.Achart€rer who does
not complete the ftrll cargo
he bound hi"nrelf to ehip.s\lt
o"" *trLightage of the anount he
faib to ship, if .he captain ad
tor." other beight to comprete
the load of the veeee\L which;;;h" ""t -- -. ;*t chartcrer ehall pay tbe
dilfenence, ehould there be auy.
AnrIcLE 6sl' If the chartorar ahour,
rord goodr dirferent ft.om
thoro ctated at the tfuneof erec"itrg
til party, rrithout tbo
Lnowledge of the penon from whoi
tt. "'artcr wac chart€red or of t
"""""t
I
I
;t
{
fi
I'
IlrtRlTIll!l ir\W 677
Chsrtr.rPartie..l
P.{RT 4
TOTAL OR PARTTAL RESCISSION OF CIIARTAR PARIIES
ARTICLE 88& A eherter party may be reecinded at the reqned
of tho chartoron
l. lf bcfore loading tbe vesael he ahould not afree with that
rtrtcd In tha certlftceto oli rrrr.rgu, or if l,hcre rhoutd Lo an orror in
tho stetement of the flag under which ebe'saile.
2. lf the voruel ehoutd not be placed ut thc diepocat of the
char-terer within tbe period and in the manner agreed ,p*rr.
3. Ifafter the vessel hns put to sea, she should return to the
port of departure, on.account of risk from pirates, enemies, or bad
weather, and the shippers ehould agree to unload her.
In the rsecondand third eRresthe p.,rn.rn from whom thc vesgel
wae chartered ehall indemnify the charterer for the voyage out.
4. If the charter ehould have been made by the rnonth*, the
charterere ehall pay the full freightage for one month, if the voyage
is for a port in the eame *,atere, and for two monthe, if for a port in
different waterg.
From one port to another of the philippinee and a{jacent
ial&nds, the freightage for one month only shali be paid.
5. If the veee€l should make a port during the voyage in order
to- Take urg-ent rcpairr, and the ehsr-tere* ehould pr*f.r io diepore
of the rnerchandise.
' -D*ing the internrption, the charterer may at the proper tinre
and for hia own accorrnt, unload and load the roerchaadiee,
paying
demu*age if he deraye the reloading afiier the ca*se for
the detention
has ceaeed.
ARTICLE 6S2. A charter party shall ber partially reecinded
unlesx there is an agrecErent t<rthe contrary, and {
the captain ehall
only be entitled-to thefreightage for the voyage
n-ty reseon of
a declaration of war, closing of po"t", or interdiction
""t, of co-rnercial
relatione during the voyage, the veeeel ghould
make the port
designated for auch a c,rae io tru instructions of
the chartcrer.
PROBLEMS:
a) M a y X Y Z S h i p p i n g C o r p o r a t . i o nv a l i d l y a s k f o r t h e
r e s c i s s i o no f t h e C h a r l e r p a r t y ? I f s o , c a n S a n d
Development
Corporation recoverdamages?To what extent?
b) If the Oelob Maritime Corporation, did not load it for its
own account,is it bound by the charter party?
CASES:
OFARREL
NAVIGATION -y.gl! qghg bueinese-::g:: the name of rfrALAySrAN
COMP^(Ti ;. i#'MANII.A
ELECTRIC -- COMPANY
G.R lio. \IZZZ, October ZS,
ftg.-
This actionwasinstituteer
in the court of !"irst Instance
o'Farrel v cia, a commercjalpa.tnershiploing of the city of Manila by
Navigationcompanv,wii[{i;;;;;;io#'.", n*ir,"r";;;; ,h" ofthe Malaysian
recoveringfrom the Manita pr"ctrii ";e ror rr," purpoee
in tl," citv oim"r,iir,
i"*;;;'ra ,ry,, thruecauaesoi""uon, of
the aggregate
it"%'ffinffi#*i.n*o"t'"ri"gi t"r*iue_to rhe;*J;.fr oreach
lter the action was O"rul,O,l.arrel orcontract.
and W J. 'donovan i Ci.**
a""fared insolvent,
proeecured,,,,a".r,i";Fif t11trj:?Tll*:fi
notchanged. In thecourse_"rri"irr*"'-ar#u'in :ffi,.f,mm:*Ir
th" c"rrt"ii[*i'i**"**ecf,sewas
coneolidatedwithanotheractioninetitutadi"n
bvthesociet!***r ,r,. ,"-u *"rt, *_" ddreq.rant,
crt*ilr"ri-r lot"1,yr., "r"ir"itn"
i' tli"
only with the actionia$itu-tcd
*r 9rt .ppuarweeremncerned
uy oi"-Jy
rreviewthe hiar co"rt ounat,iiti" cia. uponhearinjthe caeonow
ilin *""-rrot wenroundedand under
Jti;;;;"-t nbaorvsd
ttre
iiifffn-rffiJle "o'npt'int rheprainriff.
r*m rhielodgmont
the
tl" S oc:
tctt Ft,,nc.,
i sedes oh.ar tnnnasea du Tbnhin(hereinafter
*r"* TtlT"tH
whiretheMln;;;;;:.Tff
il:r::-"H1,,til!f.f#*Itr""*trltHt:lH;
,l{ iHJ i#il,#ilH ;*ll"f;# vciarmarar"i"iri'-*"rion
company)
in operating r.uigtrt u".r"ls in c)rienta! a ahipping comqanyengaged
*Tp-*vcon'umes rargequanriti".
,"n*. I.Tl-ud:
nr*"i, g# ln*fil*
part fromthe eoar "n;,'ffffi:fflf
"o''p"ni rr H**""'r"'il'"-"nro-ent
underwhich the deflndani
.'e***b*ff
I
!l
MARITIMII I,AW 681
CharterParties
had ber"npurthaeing coal fron said company having been found to be unseti6factory
for
DdDlei'tlatioll or olher, !o the del'eudenl, a new conlract was enter€d into,
in tle month of
Auguat, 1923, whereby the coal compeny agre€d to sell and the defendsnt
agreod to huy,
in t'he period Fom Septemberl, lg23, toAugrat gl, 1924,?6,0{x)tonr oraustcoel,
rii;
a margin of l0 per cent more or leee.In t-hiecontract it wae agreed that
delivery silould
be taken by the defendant in lotr of aborrt from 2,(X)oio 4,(fi tnna at trErlar
intorvelg,
as could bost be arangotl to suit both purchaaerr and aellers, the purchaeera
ag1.ooi11gto
take not le$e than about 6,000 tona per month and trr senrJnot,more Lhan one
at to
ho loaded al' the Bametinre. It was als,ostipulatcd that the dust eoal,
in"r"Ui*t "rnui
sale,ehould be loadedeither in the stream tr alongsidethe wharf or quay "i*."at
at Hongay,
the opt'ionof the coal company,"with quick deapatr.h,vess€letaking their
turn in loading."
Ag neither the coal oompany nor the Manila Erectric company rnai engaged
in operatiig
eeagoingvessels,it becameneceesaryfor the defendant tomake arangement
with eomi
ehipping company for the service neeescar)'to transpr.rrt the coal to Manila.
Thie need
(irutoti o'Furrol, t.lrengoriiof'[lrr..
lx'ilrg rt1t1xrrilnt, coiil(:()ntpllrly,
ig Mgliln, dir6ctrd ths
attartrtiorrof llre dtfondsnt c{tmpanyhr thc Mall.yxian Navigaiion Company,
t}e [rade.
traltr*of ( )'Farr0l y {)irl, ax olxtrntittg vepeclrL}ratwoulrtlxr avurlubluI'ortrapuporting
the
coaj' ln ilrir cunn6tt'ionit ahould be not*d t"hat0'l'nrr*l war ag*nt bottr of the coaf
*.iliy
nud tht MulrryrrnrrNuvrgntion(ionrptny
'ltte
contractbctwe'ert tlre plainliffanri tlrt r|,ferrdirntfor thl trarruportotionof the
coal prrrchascdb.vtlre defelrduntfru&r the coal ct.rrrrparry wus, in uubetanee,ae followe:
l. The Malaysian Navigatro. co. undertakeeto transport seventy-
iirr tiir.rusarrti
ton* ol cr,aii lti p:r ccnt,rnoreor lessl, frorn Honjay to Manila
nt the lreight rata of four p*uru und fili.v ccrrtavori(Ir4.50r,p", ton of 1,016
krlos, lece a rebate of I per cent.
2' Irreight to be paid on arrivar r.,r'eachshipment at Manila ae per
B/t_.
3. Loading to be for account and risk of shippers accordingto
c-ustomaryquick despatchsubject to turn of mines.
4. F'or discharging at Manila the iltanila Electric co. wiil provide
suffrcient lighters to r.eceive-
the coal at ship side as faet as the ehip can
discharge Demu'age, if any, to be at the raLe of p600 per day of fraction
thereof;it in understoodthat the Mnnila filcctric co. wilt not be compeltedto :
pay demurrage for daya when it ehall hsve received at leaet 50Otong
ofcoal.
The practice.ftlllowedby the partics in the performanceof thie contract was that,
upon the receipt of information in Manila by the defendant company from the
coai
company' advising that a cargo of coal r+raa,or aoon would be available in Hongay, t5e
mesgagewas turned over to o'Farrel y cia, and the la[er company made
the
arrangements for the sending of a boat to Hongay. But delay io the taking on of
coal
occurred in Hongay, owing io the inability of the coal company to deliver the coal to
'laitilS boata. Th9 prtponderance the
of the prcof ehowe tbat thia delay war due to the fact
tbat tho crsnos of ths cod company at, Hongay were defoctivo and ofton out of ordor.
At
sny rsts tllc roaul! war *r*t tbo plcintilfr boatc were freqqently kept waiting in the
port; and it in flct appaare tbat altogether they were held there idl* ot t
u oodt"al*r"ty-
tIreo tlays, (o say nothing of the time ocuupied in the lad.ing of the ahipa after tbeir
turn
had for taking cargo. .There can be no doubt, we th-ink, that theae delaye wen
-com9
attributable to the coal 6!npeny.
t 582 NorEs
AND
"*oyroilffi.W,f#ffr"onrArro*
ff.1"*trT,r###it"ii}1'ttr*tr$ilq[t.'trttffi
"^*"""rjri?:::il
r*sTTi
tlliel:l:*,T,lr,;llliHll,*HTllil:ll'}*1*
Hongav' ;l'*:;-ffi,tr
forreartharthernrorJ"ji'#
ribered
forthe*", *.iJriiTI"H ,"rr"" .o
abovesuggested,
deliverieeof coa!to the defendant
r"a*roir:ll.,f*::1:Tt
rons, comDanv
i*'rfrlr:Ttrl*:Tffr1amou1ted,."r'"e ii1+,onr_v,
oreome abou*i,sz6
:ill|"T;Hil*::",1i',tu'"*e';;:
ff1il"'i:'#1"*Trp:-:q;::liffiJffi
c:*0."-rlJ;"'""to"*et,ls24.*'*::-ojor"ru.l""?r;:ifi:ffi
i:X**rt"t
ortn*s.i;;"t; ".'*ined bvit from up"'" gir"s
"nit:r."::'j.. noticeof tre dirp"t"h
noJd"Tilffi ,l$i'"':fi "j1;*,t,rs24,'i,"r"i".J'
was ehorr
nei,ry t"",ffi :ff
"zo.ooo
ffi fffrlf :fi;,:#.[ffi
fif iT'Jfr;Yffi iff :f il'Tlkl":tft*a'ir,r,,ipy^,"{theapprovaror
:ff ,*:lffitr";l;tTl"ff
"':l;3trff
theformer
ff'T:"ff
itr"'*""#3:ffi fffi #;
thefacttt;ili *",iiilil;lff.q::'"n companr,
tl"l it would be unable,bo tt t"tt ' *-rnrniJ'ttil
"
c""io-"',i""".'"Ifl
traneportatio; ;'f;;
;rTllrrr#,Hffi ji,'x*11*tr$ft*l;
r;lr;tl;;i:r
proceedrr.*,"i r"J-" the contract for
the
In tho plnintifl'rr
threerepara,€causesof
1T^rlfrrr
to.ecover actionare atated,in the first
pao,rgo,
the"u,n.of * *,ip.o"auonwhich
i[1fi"#;::l$;Ti:u"*F
as the
conlempla*o t l'.t"t"tved had all of the *rt n**r.-iuii"lrilJ," o for tranaportation.
caueeor"",r""1i,"Ti,:l,T.FTT"n::'ff
l':k*r'#f
repreaentedbv thedemu..ug" #j#ffi
.i;;;aii"tr,u,pirintifr, at
the onehundredtwenry+hrle;;il;;;^i,rri5r, ;;;il of p600per
awaitinstheir turn ir, ,[*r.*"rJo"*n"a in day,for
*i!: o-n.Jr. ffif thir<i. Honsav
cnusaol?ii*in" prainriffeeekn
ff;:f,:T"ffi:f i,,,rT,r*i";'i'"rl "',Tffiffl,n,.n
"i',,],,",i nnotrsair
ror
ro
Sompanv_ro deriverie*
lf il"i
trtrfi.:f$ryI"-Hi;f *il l,X*: *111 [i *h, l *r,
the ptaintirfe
"rrhe ca
"fura
caueeof action.The ttt*.y :l",r", " diccue"ion
in our ortrre
usesor
^tiir'.'* trilifrlutietr,at
,i"aJi;;i":Tt"arlv-eeen
:Ip*{ *u;;s;;;;iil?ol?ffiHff"'fiJ'; the coJ
"*Jrii
:ig*""T:H:i*J:'1"n*d";i;#"HtrJiiTff
1thepoeition
anctof the plaintiff i orol.r."l
1*:trfff"T:?"",'m
i|lil ffT
asenr iio*oi"tr
oftheour"no*nr''ff11*
".flT"tv. ", rh";;;i'1"#*;Tj:il1
theplaintltrJilffi:l,J,l:ffi.:illtur :j,::':lo"n5
oPinioncommitldrnienyinedamagea
to
t
{i
J
MARTTtrMEI"AW 68$
Chartcr Partier
"If in the charter party the time in which the loarting and unloading
is
to take place in not etated, the cuatoms of the port *h"L theee
acts take
place ahall be obeen'ed.After the period stipulated
or the cuatomar;rone has
paesed, and should tlere not be in the rreight contract
clause
fixing the indemnification for tho d*lay, the crrptain nholt"r, "op..r"
bo entitlod to
d*mand dtnrurrage for tho ueual and o*iro lay clayuwhich -ry
hu;;;;pJ
in loading and unloading.'
guoss€d that it would collide rith MV lloaa Paz, hilling almoct all the paracrryen and
crew membera of both shipq and thue rmulting in one of the counffr rroilt Bsritimg
disaEt€rg.
The petition before us geekl to reverse the Court ofAppeals decieioal tln CA,4.R
CV No. 29526 promulgated on April 15, 1997,Juetice Jorge S. lmperial, ponente,Justices
Mabutas and Hormachuelos, concui"ning.lholding petitioner jointly liable with the
op€rator of MT Vector for damages when the latter collided with Sulpicio.Lineg, lnc.'g
pass€ngerahip MV Doila Paz,
'lfhe facte are as follows:
On December 19, 198?, motor tanker MT Vector left Linay, Bataan, at about 8:0O
p.m., enroute to Masbate, loaded with 8,800 barrele of petroleum products shipped by
petitioner Caltex. tFindingp and Becommendation of the Board of Marine lnquiry dated
March 22, 1988, Rollo,p. 368.1MT Vector ie a tramping motor tanker owned and operatcd
by Vector Shippurg Corporation, engaged in lhe businees of tranaporting fuel products
euch as gaaoline, keroaene,diesel 8nd crrde oil. During that particular voyage,the MT
Vcctor carried on bon;d garolino alrd othcr oil prodrrr:tsuwncd by Caltex by virtue of a
cbarter contract between them. [I6id., Rollo, p. 350.1
On Deeember20, 1987,at, about,6:30a.m., lhc pussetrgcrchip MV Doda Paz lefl,
the port ofTacloban headed for Manila with a complement of 59 crew membereincluding
the marter and his offrcera,and passengerstotaling 1,493 ac indicated in the Coast
Guard Clearance.t/bid., Rollo,p. 35?.Actually, there were more than 4,000 pasaengera..l
The MV Dofra Paz is a paseengerand cargo vessel owned and operated by Sulpicio Lines,
Inc. plying the route of Manila/Tacloban/Catbalogan/Manila/Catbalogan/Tacloban/
Manila, making trips twice a week.
At about l0;30 p.m. of December20, 1987,the two vesselscollidedin the open eea
within the vicinity of Dumdi Point between Marinduque and Oriental Mindoro. All the
crewmembere of MV Dofla Paz died, while the two gurvivors from MT Vector claimed
that they were sleeping at the time of the incident.
The MV Dofra Paz ca:r'riedan estimated 4,000 passengers;many indeed, $/eFenot
in the paseengermanifest. Only 24 sunrived the tragedy after having been rescued from
the burning waters by vessels that responded to distrees calls. lDecision, Court, ofAppeals,
dated April 15, 1997, Rollo, pp. 54-75.1Among those who perished were public scbool
teacher Sebastiar Cafiezal (47 years old) and his daughter Corazon Caiezal (11 years
old), both unmanifegted paesengersbut proved to be on board the vessel.
On March 22, 1988, the board of marine inquiry in BMI Cas€ No. 653-8? after
investigation found that the MT Vectoa its registered operator Francisco Soriano, and
its owner and actual operator Vector Shipping Corporation, were at fault and responsible
for ite co[ieion with MV Dofia Paz. [Finding and Recommendationg of the Boerd ofMarine
Inquiry dated March 22, 1988, Rollo, pp. 347-402.)
On February 13, lg8g,Tereeita Cafrezaland Sotera E. Cafrezal,Sebasfian Caiezal'o
wife and mother respectively, filed with the Regional Tlial Court, Branch 8, Manila, a
complaint for "Damages Arising from Breach of Contract of Carriage" againet Sulpicio
Linea, Inc. (herealter Sulpicio). Sulpicio, in turn, filed a third party conplsint againet
Franqisco Soriano, Vector Shipping Corporation and Caltcx (Philippines), Inc. Sulpicio
alleged that Caltex chartered M[Vector with groao and evident bad faith knowing fully
well that MT Vector was impmperly manned, ill-equipped, unseaworthy and a hazard to
safe navigation; as a reault, it ramned against MV Dof,a Paz in the open aea aetting l[T
Vectoy'e highly flammable caryo ablaze.
J
t
$
\
MARTNME I.AW
0hartr:r l'or{rea
&86
ion septemfur 15, lgg2, the rrwl court reruk:redlutrgnrent nwhing sullilcio Liws
lrablc- Tle court of Appeals mu-lified the triu! ct)ut:!'siultng und iina"a ptitiarwr
Coltez a:t otte of the those liabte for darnages therebl mahingiaid petitioner Cattex
and
vector shipping co. equally liabrc under the thint poriy to reimburx/
indzmnifu d"efendant sul-picio Lincs, Irw of the aboui-nwntionzd "o^ptoint
damagel ottornrj,b
fees and coatswhi.ch the httcr is adjudged to pay plaintiffs, the sanu to fu shsred hrrlf
by vector s,!.o1itw co. king tfu vesiel at iauit
fo, the collision) and tfu othcr hoif
b! Caltpr (Phils.) Inc.l
Hence,thie petition.
We find the petition meritorious.
Firat: The charterer haa no liabihty for ilanrugcsunder Phitippine Maritime lawe.
' The respectiverights and dutiea ofa ohipper
and the carrier dependsnot on whether
the carrier ie public or private, but on whethlr the contract ofcarriage ia a
bi1 oflading
or equivalent shipping documentson the one hand, or a charter party or sim.ilar
contract
on other. [Philippine Admiralty and Maritirne La*; by Attya. Eduardo Hernandez
!!e
and Antcru Pefrasaler,l g8z, p 23?, citing $chrx.nlrlunr & viunnnp*rulm,Adrniralty
and
Marilime Law, al p. 364.1
Petitionerand Vectorentcred int{) r (:{rntrrt'tof rrlfrr:ightment,aleo known
as a
voyagecharter. [Ibid., p.495, citing Healy & fiharp, Admiralty, p. a0b.l
- A charte r party is a contract by whrch un entire ship, or some priacipat part thereof,
is let by the owner to anotler person for a specifiedtime r. *; a contract of ifreigbbeni
is one by which the owner of a ship or other vessel leis the whole or part of
her to a
merchant or other p€rson for the conveyanceof goods, on a particular voyage,
in
coneiderationof the payrnent of freight. [TabacaleraInsurance Co.u,Nortt front
Shilping
Servicea,272 SCRA SZ7 (lgg7), citing planters Ilrrxluclr, Inc. v. Court of
appeata,Zed
scRA476( re93)|
A eontrnct of affreightmeni rnay hc either time r:harter,wherein the leaeedveaSel
ia leased to the charterer for a hxed period of time, or voyagecharter. ,*t
th".hifis
leaeedfor a single voyage.In both cases,the charter-pariy pro,rideofor"r"i6 the hire ofthe
veaeelonly, either for a deternrinate period of time or for a single or consecutive
voyagg,
the ship-owner to supply the ahip's store, pay for the *ougus,rf tf,e mast€r of the
crew,aaj
defray the expendesfor the maincenanceof the ship. trOia., .iting Planters Froducts,
Inc. v. Court of Appeals,226 SCRA 4?6 i i99:l ) 1
Under a demiee or bareboat charter on Lhe other hand, the charterer mane the
vecselwith his own peopleand becomcs,in t,ffe.ct.thc .wrrlf for the voyflge scryice
or
stipulated, aulljecl to linbility for danrugesclused by negligence.
If the charter is a contract of affreightment. whrch leave.rthe general rlwner in
poseeseionof the ship as owner for the voyage. the rights and
the responsibilities of
ownership rest on the owner. The charkrrer is free lit,m liability to third pereons
in
resp€ctof the ship. lPuromines v. courr of Appeals,2z0 scRA 2si (1gg3j.]
into a privatc one?wc need to answer this question in order to shed light on the
of the Parties'
responsibilitres
In this case.the charter party agreement did not convert the common carrier into .f-
character
a private carrier. The parties entered into a loyage charter, which retains the
*'n";:;';;;'*;"{""',. t,{
r',,, ,roo*ot,,rzz6scRA4?6reea)jwesaid:
' 'lt is therefore imperative that a public carrier shall remain as such, il
p€r8on8'
notwithrliantling the charter of the whole ilr portion 0f a ve8selby one or more
provided the charter is limited to the ship only,as in the caseof a time+harter or voyage
It is only when the charter includesbot-hthe vesseland its crew,ae in a bareboat
"h".tr.. particular
or demise that a common carrier bec<imesprivatc, at least insofar as the
vayage covering the charter-party is concerned. Indubitably, a ship-owner in a tine or
charter retqins poa*eseionand control of th$ ship, 4lthough her holde may, for
"oy"go
the nronrent,be the property of the charterer.'
L8[er, we mled in coantwise Lighterage corporatktn u. court of Appale{ 245 scRA
797 (1995i]
"Although a charter party may transform & commoncarrier into a private one,the
same however ie not true in a contract of afTreightmetrtxxx"
A comnroncarrier rs a person or corporation whosc regrrlar bueineeeis tO carry
passengers or prop€ny for all perEor]$who nray choosek'r employ and to remunerate
him. [united statcs us. Qnin"jon,31 Phil. 189 (1915);L]nited statee v. Tan Piaoco,40
of
irhil.853 ( 1920)lMTVector.fitr the definitionul'a srntntoncarritr underArtictret?32
16s scRA 612,61?-619 (1988)l we
the cir.il codc. In Guzman vs. cou!:t of Appeals,f
mled:
xxx
Thus, the carriers are deemed!o rvarrant impliediy the seaworthinessof the ahip'
and manned
For a tessel to be seaworthy,it must,be adequately equipped for the voyage
with a suflicient number oicompetent officers and crew:The failure of a comrnon carrier
vusncl involvcrl irr its contract of carriege ia a
t, nrrrinhrin in senworthy contlit.ionLhe
preecribedin Article 1?55of the Civil Code.18 lTlans-Asia Shipping
clear breachof its cluty
14
Lines v. court of Appeale,254 scRA 260 r1996),citing chan Keep v. chan Gioco'
Phil. 5 (1909)1.
The provisions owed their conceptionto the nature of the business of common
of neceeeity
carriers. This busineseis impreesedwith a special public duty. The public must
rely on [ne care alci skill ofconilrrrt carnels in lhe vigilanceovei the goodsand safety cf
the passengers, especiallybecausewifh the nrqdern development ofscience and invention,
traneportation has becomem0re rapid, more coilrplicatedand eomehowmore hazardous'
MARI'TIMF]Il\W 68?
.Charter Parties
cirltex and vector shipping q"r"r*J,l had been doing bueinesssince 1985,or
for about two years before the tragic incident r-rcurred
in 1gg7. past s€fficea rendered
showedno reason for Caltex to obs,.r.,r,r a high.r dcgreeof diligen;-
olearly, as a mere voyagecharterer,caltex had
lhe right to pre'ume t},at the ehip
w a s g e a w o r t h y a s e v e n t h e P h i l i p g r i r r t{,l o r r s rC
. u a r c l i t e e l f w a s c o n v i n c e do f i t s
seaworthiness.All things considered,we find no legal
U"*ir to frofa ietitioner liable for
damages.
AsvectorshippingcorporationdidnotappealfronrthecourtofAppears,deeision,
.
we.limit our ruling to the liabilrty of caltex ,,ione.Howev"r,
*" -ui"t"in the court of
Appeals'ruling insofaras Vectoris concerned.
MARITIMN I-AW s80
(lhartr:r l'nrtres
I rt',
1) (l{
8Urt',
r[X)r,
trt 0t'
d bl'
f thl
teell
iis
8WS.
iag,t
e not
antl
iabl,s
tr as
Inn0t
r thir
,f the
)Pers
rn its
li
e $ll"v
:ltcr t
15. or
dered
e ship
of il:s
rle f,rr
:ision,
rurt of
CHAPTER1O
LOANSON BOTTCIMRY
AND RESPONDENTIA
I. DEFINTTIONS ANDCONCEPT.
Bottomry,in maritime raw,is a contract
wherebythe owner of a ship
borrowsfor the use,equipm""t;;;;;;orrn*
pledgesthe ship(or the keelor r,u**t,G, iefinite term, and
"
Uoni^ ottneshipporspro tato)as security,with
the stipulationthat if the ship i" i""i
ari"g the voyageor during the rimilsd
time on accountof the perils;r"*";;;l-,
the lendershall losehis rnonev.z
'Ibid.
ii *;.w .aa-^.rd.{rwabdlE;gilbl
1
.dd.
,{
I 6s2 NCIr*sAND"Tt?fgffy,ffif,Tff**mArroN
rArticle 726,
Code of Commerce.
oArticle 727,
C<d,eof Commerrt,.
rDel Vieo, p.
694.
TArticle ?29,
Code of Commerrce.
'Article
?28, Crxk,of Commonr,
rArticl.r ?21'r,
(ixlt of Commnrce.
roArticlo8l?.
Crxh of Commorro.
i iji
ffi
{ MARITIME LATry
I;rilrtl utr llllLrLilly 'rltri !terpol'tl''r'l ' '
Undcrwh|cbcvorofthgreformlthecrrntrncti*erocutad,it
;;LJ r" tbo oortlltcato of regiatry of the-vescolrnd ehdl
"b"11
L rsrdod in th;rosirtry of voerale, without whtch roqu6itor, tho
the
*"aftt of thir kina siFtt not have, with regard to-othercrodits'
shlch, accordiog to their nature' They ehould have
p*f"."...
iitlo|rgu the obligation shall be valid between the contrecting
partiea.
govorrrod by tbe
Tbe contrscts mrdo during a voyage ehall b€
be effective wlth regard
prov6lonr olArttclor 68tt and 6l l,
",'d "tt*tt
tothtrdpor.oD'hornthedrteoft.heirerecution,ift.beyehouldbe
of the vccrol
romrdcd to th" t dttty of vecrolr of the port of regittry
her arival. thould
bcfors tbe lapce oi uix;lt daye trom tbe date of
arlu without the record haviTg been nade ln
tl" *fa cf*i
"tip."
the contracte made during tbe voyago of tho
*i *ttthi of vesreb'
prod.uce no efiect with regard to ttrird p€rson8, ereept
"o"oi"hall
lron the &y of their lnrcription'
eccqurlance
In order tbet the policy of the contracts execut€d in
fooce, they must conform.lo tbe regstry
wtt'hNo. Z rneyhevobisai'.i
prJ thsreln' *ith to thoee erecuted
of the broker wbo tooh "*"p*tof ttra algn*ure chdl
ln accordenewithNo. i, the acknowledguent
bo rrquircd.
not gfve rtsr
Contrectr which rre not reducod to wrlting shsll
to judicirl ection"'
r"rfttre kind, nome
Furthermore, the contract must contain a statemelrt
domicile of the captain; tbe
and regietry of the ve88el; the name, surname, and
grving and the p€r8on receiving
D8mes, sulanmeE, and domiciles of the p€r8on
the time for
the loan; the amouniof tU" loan andihu ptu*i.rm stipulated;
and the voydge during
rsp"ynuot; the objects pledged to secure repayment;
whicb the risk is t0 run.rr
v.co}|sEQUENcEsoFLossoFEFFECTSoFTHELoANs.
sea during the
If the effects of the loane be lost due to an accident of the
in the contract
ti-", *Joo tfre oaasion of the voyage which has been designated
lender losesthe right to
and it is proven that the ."rgo *L on board, thcn thc
The lender, howevel
institut€ tle action which *oota pertained to him as such.
inherent defect of t"he
,*t ir, ,rr"r, right of action if the loss was caused by the
trarratrv rrnrlte
ihfi;;; thto,rln th" fault or malice of the borrowcr,or through
the ve88€r.'s u
pa*1f tne ."pLio, or if it was caused by damages suffered by
MA}iITIME I"AIY
Laaneon Bottomryand llerpondentia
rhall acquiro nll the rightc arrd ehall incur all the riskr cornoapondtng $!,
ll
to the indoneer. t.
rt
ARTICLE ??-i. toane may be made in goodc and in s61shrnfi66, I!
fixing their value in order to determine the principal of the loan I}
it'
it,
ARTICLE 724, The loans may be constituted jointly or t:
reparately: it
E'
5t
1g
1. 0n the hull of the veerel. :*
ts $
!
2, On tho rlfging. t {,.
S. On the equiprnent, provieionu, snd fuol. ti
rt
$t
4. On the engine, if the veseel ie a st€amer, ttl
!.:q
t r-
5. On the merchand.ise loaded. lf,
t{:
If the loan in conetituted on tbe hull of the veerelo the rigging Il'
equipment and other goode, prnvisions, fuel, etesni enginec, and the
sec NorEsAND
r*fffi,.filfJ#,r,:ffiy*sF0&rArToN