Subject: Transportation (Finals Tips)

Professor: Atty. Ampil

By: Butch Ramiro and Pierre Martin Reyes C2013

` may be held solidarily liable with the shipowner for liability to third
Note: Study everything, but pay particular attention to these especially the persons.
enumerations and definitions. Good luck!
6. What is a supercargo?
1. What are the exceptions to the rule of abandonment/limited liability
rule? As provided for by Art. 649, he is an agent of the owner of the goods
shipped as cargo on a vessel. He will sell such cargo to the best
a) Expenses for repairs of the vessel made PRIOR to the loss of advantage in a foreign market and buys goods to be placed as cargo in
the Vessel the returning voyage and comes home with it.
b) Workmen’s Compensation claims
c) Where the vessel is insured 7. Differentiate a contract of affreightment and a bareboat charter or
d) Where the injury or death to a passenger is due either to the fault demise
of the ship owner, or to the concurring negligence of the ship
owner and the captain In a contract of affreightment (time/voyage charter), the whole or part
of the vessel is leased to the charterer. The shipowner however, retains
2. What are the 3 functions of the captain? possession, control and management of the vessel and remains to be
liable for wages and damage or injury to cargo or passengers.
a) General agent of the shipowner
b) Technical director of the vessel In a bareboat charter or demise, the whole vessel is let to the
c) Representative of the government under whose flag he charterer. The charterer exercises total control, possession and
navigates management over the vessel. In this particular case, the charterer is
considered to be the owner PRO HACVICE (for that particular voyage)
3. Who is the sailing mate?
8. Differentiate demurrage and primage
He is the second in command and takes over in case of the disability of
the captain. He is required to provide himself with the charts and to keep Demurrage is the compensation paid to the shipowner when the vessel
a Binnacle Book. He is also responsible for damages to the vessel or has been detained beyond the time agreed upon for loading and
cargo caused by his negligence, in addition to criminal liability. unloading.

4. Who is the second mate? Primage is the bonus given/paid to the captain after a successful voyage
and for taking care of the goods during the voyage.
As per Art. 633, He is the third in command and takes over in case of the
disability of the captain and the sailing mate. In such case, he assumes 9. What are lay-days?
their powers and responsibilities. 2 examples are a) to assign work to
each sailor b) to ensure that the cargo is well-arranged Time allowed for the loading or unloading of cargo from the ship

5. What is a ship agent? 10. Differentiate loan on bottomry and loan on respondentia

The ship agent is the person tasked to represent, manage, operate and Loan on bottomry: Loan made by the shipowner, the ship agent, on in
provision the ship owner’s vessel at a port that it may be found. It may their absence, the captain, with the vessel as security. The loan will only
include a shipowner. It is not an ordinary agent under the Civil Code as it be paid upon the safe arrival of the vessel.

1
Subject: Transportation (Finals Tips)
Professor: Atty. Ampil
By: Butch Ramiro and Pierre Martin Reyes C2013

Loan on respondentia: Loan in which the security is the cargo with the 13. What are the requisites for general average?
condition that the loan will only be paid upon safe arrival of the cargo.
a) There must be a common danger.
11. 4 kinds of maritime accidents b) That part of the vessel/cargo is sacrificed deliberately for the
common safety
a) Simple/General Average c) The ship and cargo are saved after the expenses and damage
b) Shipwreck caused.
d) that the expenses or damages should have been incurred or
It is when a ship has received injuries rendering her incapable of inflicted after taking proper legal steps and authority
navigation. It also includes loss of a vessel at sea, either by
being swallowed up by the waves, or by hitting another vessel, or 14. When is protest required within 24 hours? (CASH)
running aground.
a) In case of maritime collisions
c) Collision/Allision: b) When the vessel arrives under stress
c) Where the vessel is shipwrecked
Collision means the impact of two vessels both which are d) Where the vessel has gone through a hurricane or when the
moving. However, in its broad sense, it also includes allusion, captain believes that the cargo has suffered damages/averages
which refers to the striking of a moving vessel against one that is
stationary. 15. What are the two types of international transportation by air?

d) Arrival under Stress a) that where the place of departure and the place of destination
are situated within the territories of two High Contracting Parties
Under Art 819, it is the arrival of a vessel at the nearest and most regardless of whether or not there be a break in the
convenient port if during the voyage, the vessel cannot continue transportation or a transshipment; and
to the port destination because of: b) that where the place of departure and the place of destination
are within the territory of a single High Contracting Party if there
1) lack of provisions is an agreed stopping place within a territory subject to the
2) fear of seizure, privateers or pirates sovereignty, mandate, or authority of another power, even
3) any sea accident disabling the vessel to navigate though the power is not a party to the Convention.

12. What is a simple average? 16. What is the doctrine of “inscrutable fault”?

It is an expense incurred or damage suffered which have not inured to If it cannot be determined which of the two vessels caused the collision,
the common benefit and profit of all persons interested in the vessel and each ship will suffer its own damages, and both shall be solidarily liable
its cargo. for the losses and damages occasioned by their cargoes (Art. 827 and
828)

2
Subject: Transportation (Finals Tips)
Professor: Atty. Ampil
By: Butch Ramiro and Pierre Martin Reyes C2013

17. What is salvage? Requisites for Salvage? 19. COGSA v. WARSAW (5 differences)

a) Marine Peril COGSA WARSAW

b) Service voluntarily rendered without an existing duty or special Applies to goods only Applies to goods and passengers
contract Applies to carriage of goods by Applies to carriage by air
c) Success, in whole or in part, or the service rendered contributed sea/water
to the success Applies to domestic carriage (when Applies only to international
the destination is the PH) carriage
Salvage is made when persons under no responsibility to do so save the Domestic Law International Law (international
ship and its cargo from a maritime peril. Such persons are entitled to the convention)
proceeds of the salvage (e.g. a reward) Prescriptive period of 1 year to file Prescriptive period of 2 years to file
suit suit
18. What is towage?
20. Under COGSA, what are the 4 places where an action for damages
Towage is the towing of a vessel by another using a line or rope to help may be brought?
move a stationary vessel or one whose movement is limited. However, in
this case, there is no marine peril present. It is a quasi-contract wherein a) domicile of the carrier;
indemnity is paid to the shipowner of the towing vessel. b) the carrier’s principal place of business;
c) the place where the carrier has a place of business through
Alhambra Cigar vs. La Granja: (When Salvage, when towage) which the contract was made;
d) the place of destination
- Towing a vessel may or may not be a salvage service.
21. Differentiate CPC v. CPCN
- If the vessel towed is aided in escaping from a present or prospective
danger, the service will be regarded as one of salvage and the towage a) CPC: A Certificate of Public Convenience is issued when it is
as merely incidental. found that the operation of the proposed public service will
promote public interest for which a municipal or legislative
- If the vessel assisted is not facing any actual or probable danger and franchise is not necessary
the towing is simply for the purpose of expediting the voyage, such b) CPCN: A Certificate of Public Convenience and Necessity is
service is a towage. issued upon approval of any franchise or privilege granted by
any political subdivision when in the judgment of the regulatory
body, such franchise will serve the public interest

Requisites for the grant of a CPC or CPCN

Applicant must be a citizen of the Philippines or a corporation
incorporated under the laws of the Philippines
The applicant must be financially capable
The applicant must prove that the operation of the proposed public
service will promote the public interest.

3
Subject: Transportation (Finals Tips)
Professor: Atty. Ampil
By: Butch Ramiro and Pierre Martin Reyes C2013

22. What is the prior operator rule? After the dismissal of the claim at the end of the 1 year prescriptive
period, a party may not file an action in court anymore
- The Prior Operator Rule provides that the first licensee will be protected in
his investment and will not be subjected to a ruinous competition. No Ans: False. The party can commence a new action within one year from the
certificate of public convenience will be issued to a second operator to cover date of dismissal if such dismissal is after the expiration of the first term.
the same field and in competition with the first operator who is rendering
sufficient, adequate, and satisfactory service. Transhipment jn COGSA tolls the prescriptive period

- The prior operator is given the opportunity to improve service before a Ans: False. The fact of transhipment does not operate to remove the
certificate of public convenience is granted to another. If the operator fails or transaction from the operation of the COGSA. The period still runs.
neglects to make the improvement, i.e. meet the increase in demand, when
given that opportunity, new operators will be given the chance to give the Delivery means delivery to the consignee
service needed by the public.
Ans: False. Delivery refers to actual delivery to the arrastre operator. (Union
23. True or false Carbide v. Manila Railroad)

A captain is not allowed to interfere with the navigation of a Loss or damage applies to misdelivery
compulsory pilot.
Ans: False. The definition of the term loss or damage in the COGSA
Ans: False. The master is not wholly absolved from his duties while a pilot is contemplates a situation where no delivery had been made and not when
on board his vessel and may advise or offer suggestions to him. He may there is a case of misdelivery. (Ang v. American Steamship Agencies).
countermand the orders made by the pilot in case of imminent danger to the
vessel (Far Eastern Shipping vs. CA) The insurer is not bound by the one year prescriptive period

It is the safety of the voyage which constitutes the true foundation of Ans: False. The coverage of the COGSA in relation to the one year
the general average prescriptive period includes the insurer of the goods. Otherwise, what the act
intends to prohibit after the lapse of the one year period can be done
Ans: False. It is the safety of the property, and not the voyage which indirectly by the shipper by simply fling a claim against the insurer even after
constitutes the true foundation of the general average. the lapse of the period (Filipino Merchants Insurance v. Alejandro).

Package refers to the container of the ship The shipper may not file a claim against the insurer after the
prescriptive period
Ans: False. Package refers to cartons, not to containers (Eastern Shipping
Lines v. CA) Ans: False. The liability of the insurer is not extinguished as the insurer's
liability is not based on the contract of carriage but on the contract of
The limitation of liability of COGSA is not deemed written in the bill of insurance. Hence, the shipper may claim from the said contract of insurance
lading even after the lapse of the period (Mayer Steel Pipe Corp v. CA)

Ans: False. Provisions of COGSA are part of the bill of lading, suppletorily to
Civil Code provisions. Since the Civil Code does not provide for any limitation
of liability and the COGSA does, the latter would apply (Eastern Shipping
Line vs, CA).
4
Subject: Transportation (Finals Tips)
Professor: Atty. Ampil
By: Butch Ramiro and Pierre Martin Reyes C2013

only noticed 24 hours after it started. This showed negligence

24. PROBLEM A: Principles; Distinction of Contract of Affreightment and on the part of the crewmembers of the ship.
Bareboat; Fire as fortuitous event  In this case, the fire was discovered 1 minute after it started and
was extinguished 30 seconds after discovery. This action by the
A-1) If X, owner of the goods, sues the charterer (A) and the carrier in such a short span of time shows extraordinary diligence
shipowner (B), for damage to the goods, who should be held liable? on its part. It therefore follows that the carrier may validly raise
(assume the type of charter was NOT mentioned) the defense of FIRE under COGSA.

 Liability will depend on whether the charter party is a contract of A-3) From the same problem, X argues that an on-board bill of
affreightment or bareboat lading is irrelevant
 If it is contract of affreightment, the shipowner will be held liable
as per jurisprudence  The onboard bill of lading is relevant to the issue in the case.
 If it is a bareboat, the charterer will be liable because the This is because before a shipper can claim damages against the
charterer is considered the owner pro hac vice (for that particular carrier, he must establish the existence of the goods within the
voyage) ship.
 Since there was no mention of the type of charter party, it is  It must be emphasized that the B/L is an acknowledgement by
practical to implead both. the carrier of the receipt of goods. It is the proof that the goods
were actually within the holds of the vessel. Therefore the
A-2) From the problem above, assume that the contract was one of contention is INCORRECT.
affreightment. The goods were apparently destroyed by fire. X
wants to hold B liable and argues that fire is not an exempting 25. PROBLEM B: X owns a vessel and Y owns a vessel. Both of their
circumstance. X raised the defense of fortuitous event. Who will vessels carry goods and passengers. X collided with Y which
win? caused damage to the goods/passengers carried by both X and Y.

Under the Civil Code B-1) If X is solely at fault, who will pay for the damaged
 Under the CIVIL CODE, fire may not be considered a natural goods/injury/death?
disaster or calamity. This must be so as it arises almost
invariably from some act of man or by human means. It does not When the vessel of X is solely at fault, it is liable for the damage to the
fall within the category of an act of God unless caused by vessel of Y. X shall also be liable to the shippers or consignees of the
lightning or by other natural disaster or calamity. If the civil code damaged goods contained in both vessels. X shall also be liable for the
is applied, it follows therefore that the carrier is presumed to be death or injury of the passengers of its own vessel and the vessel of Y (in
negligent in causing damage to the goods. It must prove that it other words, X is liable for everything)  same holds true if Y is the one
exercised ED in preventing the damage. In this case, the carrier solely at fault
sufficiently showed that it did exercise the required diligence.
B-2) If X and Y are both at fault, who is liable?
Under COGSA
 Sec 4(2) of COGSA provides that FIRE is an exempting X and Y will not be liable to each other because Art 827 provides that if
circumstance. However, the provision provides carrier must not the collision is imputable to both vessels, each one shall suffer its own
be at fault. damages. However, X and Y will be solidarily liable for the losses,
 In the case of Eastern Shipping v. IAC, fire was not held to be an damages, death or injury done to their cargo and passengers.
exempting circumstance because of the fact that the smoke was
5
Subject: Transportation (Finals Tips)
Professor: Atty. Ampil
By: Butch Ramiro and Pierre Martin Reyes C2013

B-3) If X and Y are at fault but not equally at fault, who is liable? delivered to the wrong person or when the goods are delivered
late.
Both vessels shall be liable as if they are equally at fault. Therefore they
will be solidarily liable to their passengers, the shippers and consignees. In such cases, the 1 year period will not apply. Instead, the
The doctrines of last clear chance and contributory negligence are provisions of the Civil Code will apply (quasi-delict: 4 years,
inapplicable in Maritime Commerce. contract: 10 years) These Civil Code periods may be tolled by a
written extrajudicial demand.
B-4) If it cannot be determined who was at fault, who will be liable?

When it cannot be determined who is at fault, it will be considered as if

both are at fault (Art 828 in relation to Art 827) Therefore, each one will
suffer its own damages, and both shall be solidarily liable for damage,
death, injury and losses to shippers/consignees/passengers.

B-5) What if both are not at fault?

According to Art 830, if both are not at fault, then there will be no liability.
It will be treated as a fortuitous event. All parties involved must bear their
own damages

B-6) What if the vessel of Z forced X to collide with Y?

According to Art 831, the owner of Z will indemnify the losses and
damages caused, the captain thereof being civilly liable to X.

26. Does a written extra-judicial claim toll the period to file a claim against
the carrier?

 COGSA provides that actions or claims for damaged goods must

be filed within 1 year from delivery or when it ought to have been
delivered
 No. In Dole v. Maritime Company, the Supreme Court held that a
written extrajudicial demand shall not toll the prescriptive period
within which to file a claim against the carrier.

 What if the goods were misdelivered or delivered late?

The situation would be different. The COGSA applies only to

damages which arose from the loss of goods. Loss means the
physical loss of the goods (perished) or if the goods go out of
commerce. It does not provide for instances when the goods are