TRANSPORTATION LAW

FINALS REVIEWER

Lectures of Atty. Rhea Joy Morales-Gonzales

CHAPTER 6 defense of due diligence in
selecting its employee cannot
• Before we go to the defenses, let us be employed; in culpa
first go back to the basics aquiliana it can be a defense
• Under the Civil Code, There are 5 o In case of the liability
sources of obligations (art.1157). capacity, in culpa contractual
These are: it is liable as a contracting
o Law party; while in quasi delict, the
o Contracts employer is liable in his
o Quasi-contracts capacity as an employer
o Delict
o Quasi-delict
• Incidentally, from these 5 sources of
• Supposing that the common carrier
obligations we can derive 3 sources
was able to prove extraordinary
of culpa or fault:
diligence in the selection and
o Culpa Contractual
supervision of the employees. Will he
(Contractual negligence due
still be liable?
to breach of contract)
o Ans. Yes he will still be liable
o Culpa Aquiliana (pertains to
because that defense,
torts or quasi delict)
although it will mitigate his
o Culpa Criminal (Criminal
liability, is not available as a
Negligence)
complete defense in culpa
• Such that in case of loss or
contractual.
deterioration or damaged of goods,
• When there is breach, there are two
there are two scenarios in terms of
giving rights to what we call
claiming for damages:
concurrent causes of action. So it is
o 1st- that which arises from the
possible that the act which breaches
contract or culpa contractual
the contract may also give rise to a
o 2nd- that which arises from
liability based on quasi-delict.
quasi-delict or culpa aquiliana
• With respect to these two sources of
• So let us look at the angle where the
obligations, there are certain
employee cause the injury. Let me
distinctions
give you just a very simple
o Basis- Culpa contractual is
illustration.
based on contract while culpa
aquiliana is based on quasi-
o A is the driver of a bus which
delict
caused an accident leaving B
o Liability of employee- in culpa
injured. What are the possible
contractual there is no liability
liabilities of the driver?
as between the driver and the
▪ The driver may be
passenger since there is no
held liable for delict or
privity of contract; In culpa
quasi delict. It cannot
aquiliana, the employee is
be based on breach of
solidarily liable with the
contract since the
employer
contract of common
o Availability of defense- in
carriage is based on
culpa contractual, the
the privity between the
 passenger and the what if the negligence of the third
operator and not person concurs with the breach as
between the when a carrier collides with another
passenger and the vehicle. Here, A is the owner of the
driver. bus driven by B. C is the owner of a
▪ Another point of jeepney driven by D which collided
clarification is that this with the bus of A. And E is the
is not limited to passenger of the bus of A. What are
drivers. It also applies the liabilities of all the parties?
to captains, officers
(Note: Pag sinabing nature, ang
and crew. These are
sagot ay kung contract, delict or
employess of the
quasi delict. Pag sinabing extent, ang
common carrier.
sagot ay whether directly or
o Supposed in the given
subsidiarily)
scenario, the driver was found
guilty beyond reasonable o With respect with the drivers,
doubt in a criminal action. B and will be joint and
Who will pay for the liability severally liable for the
with respect to the civil aspect damages
if any? o For D, he may be liable for
▪ The direct and primary quasi delict also along with C
liability under Art. 100 the employer. Quasi delict.
of the RPC is o For B and D they can be
bestowed to the directly liable under delict.
driver.
▪ Under art. 103 of the
RPC, the employer o First, criminal liability will be
will be SUBSIDIARILY imposed against B and D.
liable if: 1) the driver
becomes insolvent; 2) o What about A? What is the
there is final nature of his liability? He is
conviction civilly liable under breach of
o The carrier may also be held contract.
primarily liable under quasi-
delict as provided for in art. o What about B? Based on
2180. So dalawa pwede niya culpa aquiliana and delict
maging liability aside from the
breach of contract. This o What about C? Based on
liability is in the nature of culpa aquiliana and delict. It
vicarious liability. The cannot be culpa contractual
negligence of the employee is because there is no
imputed to the operator. contractual relation between
the passenger and the driver
of the jeepney.
• Let us look at another situation.
When there is concurrence with third o If the driver is not impleaded,
persons. In this particular example, in order to afford complete
 recovery of his rights under contract and that there
the law, it is possible that the has been a damage or
injured party can implead injury.
them by filing a third party ▪ Breach or negligence
complaint. in these cases is
always presumed.
o In this scenario, the third party ▪ The quantum of
complaint may be filed on the evidence required is
basis of solidary liability that only preponderance of
they may have. evidence.

o In this scenario, where the

plaintiff may file alternative • In article 2201, there are two
causes of actions for breach scenraios involved which explains to
of contract and quasi delict, us the extent of recovery that a
there is one limitation that we plaintiff may have. What are these
have to consider: scenarios and kindly explain the
PROHIBITION ON DOUBLE difference between the two:
RECOVERY. They cannot o In the first one, in contract and
recover twice for the same quasi-contract, in case of a
injury (reason: to avoid unjust common carrier and the
enrichment) common carrier acted in good
faith, then the liability shall be
o Remember that what is only up to the natural and
important here is that while in probable consequences of
other violations of a right, in the breach of the contract. T
contrast, there must be an o The second one is when the
allocation of breach either common carrier acted with
negligence, dekay, etc. which fraud and bad faith or gross
tends to contravene the terms negligence, in such case the
of the contract. What is the common carrier shall be liable
rule in terms of alleging a with respect to all the
cause of action in culpa damages regardless if its is
contractual for breach of natural or not.
contract of carriage? o So again, if the carrier is in
good faith, the liability is only
▪ It is not necessary for upto all the natural and
the passenger or probable consequances
shipper to allege or which the parties have
prove the negligence forseen or could not have
or act of the common reasonably forseen.
carrier. Because there Regardless of this, only the
is already a natural and probable
presumption. consequances
▪ What they need to o But when there is bad faith, all
prove and allege is the kinds of consequences
mere existence of a whether forseen or not.
• Example: A was supposed to got to a o The answerwould be different
meeting which would have given him if under the facts, the
profits. When he rode a taxi, the common carrier’s facility was
conveyance was stopped because of not seized. If for example the
a valid government seizure.Valid driver was drunk or was being
government authority seizing the negligent at the time of the
vehicle. So he was not able to got to accident, because of the
the meeting. When he filed damages presumption of negligence,
against the common carrier, he said the common carrier would
that he is entitled to damages and so appear to be in bad faith.
much more because he would have o If for example, there are facts
profited from that transaction. In fact leading to bad faith, ang
in the wordings of the book, it was a common carrier will be liable
juicy business transaction. Can A for all kinds of damages which
actually have a recovery? may be reasonably attributed
o Answer: No, A cannot to the breach of contract.
recover. The juicy transaction
DAMAGES
is not an actual injury
because it has not yet come • Mabilisan lang kasi this is under Torts
into fruition. Regardless of the and Damages
fact that it may be at hand, the • What are the kinds of damages?
common carrier still acted in o Moral
good faith since the seizure is o Exemplary
valid. Hence, A cannot be o Nominal
held liable as to unforeseen o Temperate
damages. o Actual or Compensatory
o In circumstances like this, it is o Liquidated
important to look first whether
the carrier is in good faith or in
bad faith. To know whether
• In all these kinds of damages, is proof
damages is recoverable.
of pecuniary loss necessary?
o If he was in good faith, like
o No. Only in actual damages
under these facts that there
where proof of pecuniary loss
was a valid government
is required.
seizure in their facility, or only
• What about the assessment of
the natural and probable
damages? Is it the court’s discretion
consequences may be
solely to decide?
recovered. However, under
o Yes except liquidated
the given facts., the mighty
damages. Because liquidated
meaty juicy transaction is just
damages are the ones set by
speculative. It could not have
the parties. Subject to certain
been forseen by the parties.
exceptions.
Highly speculative yung
o Liquidated damages are
resulta ng transaction na ito.
imposed by the parties.
That would not allow him to
Makikita niyo yan, when you
claim for damages.
sign a particular contract and
 you see an amount of • If for example, si Piolo Pascual
damage, in case of violation nabalian ng kamay. Pwede siya
or contravention of tenor of magclaim ng actual or compensatory
the agreement that is damage because everybody needs a
liquidated damages. hand to restore its body parts. What if
• Now let us go one by one briefly. ang nasira kay Papa P ay yung
kalahati ng kanyang mukha? Up to
what extent can he recover?
ACTUAL OR COMPENSATORY PInabalik niya, alangan naman
kalahati ng mukha mo nadamage.
• For actual or compensatory damage, Pwede ka bang magfile?
when can we claim these kinds of o Yes. The treatment for plastic
damages? surgery procedure is
o It can be claimed for a loss included.
suffered duly proven. It is an o Since puhunan niya ay
indemnification of damages in mukha sa entertainment
which the value of the actual industry, papasok siya sa loss
loss. of earning capacity
o It has two kinds: 1) for the loss • Paano kung ganito: gusto pag
already possesed by the magpagwapo ni Piolo Pascual. So
party; 2) pertaining to the aside from restoration,
failure to receive benefit magpapagawa na rind lamang daw
• Damages cannot be presumed. It siya, pwede daw bang yung kamukha
needs proof for one to be entitled of nalang ni coco martin. Can he claim
damages for actual or compensatory damage?
• In other words, the burden of proof o No. If it is only for restoration
rests on the one who is claiming, i.e.- or for treating the wound, that
-- the plaintiff is okay. Okay parin ang
• Assuming that there is an injury with plastic surgery. Okay lang
respect to a passenger, if we are yan as long as it is for
talking about actual or compensatory restoration of the parts of the
damage, what can he claim if he body involved.
suffered injury? Let us be specific. o What is not allowed is
You are a passenger of a jeepney aesthetic purposes. When
that met an accident. Nabalian ka ng piolo pascual dreamt of
buto. Ano gagawin mo? becoming like coco martin
o Immediately I will go to the already, any expenses
hospital for treatment. Can incurred in relation to that
you file for actual or procedure, he cannot claim
compensatory damage for actual or compensatory
against the common carrier damages.
for the medical treatment that
you received?
o Yes. For your injury. • What about death? How far can we
go interms of claiming for actual and
compensatory damages when there
is death?
 o It includes all expenses contract. So merong deceit attending
during the wake and funeral. the execution or implementation of
Burol hanggang libing. the contract.
o Pa-siyam > Kasama ba ang • Gross negligence impels want or
bayad sa mga padasal? absence or failure to express even
Pakain? the slightest care of diligence. Either
▪ No. How about yung there is complete disregard or
40 days? Kasama ba thoughtless disregard as to
expenses nun? Hindi consequences without exerting any
rin. effort to avoid the injury.
o Lahat ng expenses ay only • Take note that moral damages may
until the funeral. All others are be recoverable only when there is
not included. DEATH of the passenger and
o Also,with respect to fixed FARUD OR BAD FAITH OR GROSS
amount of death, it is still NEGLIGENCE AS TO AMOUNT TO
50,000. But there are still BAD FAITH.
instances where the court
added other factors to this
amount as well as the loss of NOMINAL DAMAGES
earning capacity.
o As to attorneys fees, • Nominal damages are adjudicated
particularly in article 2208 par. that the right of the plaintiff may be
1, 2, 4 and 11, these are the vindicated or recognized and not for
ones applicable to contracts the purpose of indemnifying the
of carriage. plaintiff on any loss that may be
suffered by him
MORAL DAMAGES • Is proof of actual damages material?
• When can we file moral damages? o No. It can be justified even in
What does it include? the absence of proof of the
• It includes those which are incapable specific amount of damages
of pecuniary estimation like for o It is discretionary on the court
example the mental anguish, moral and it is not dependent on
shock, physical suffering, anxiety, actual or compensatory
etc. if they are the proximate result of damages
defendant’s acts or omission. TEMPERATE DAMAGES
• Several requisites before we can file
for moral damages. When are they • It is more than nominal but less than
recoverable? compensatory.
o They may be recovered in a • Under article 2224, it may be
contract of carriage when the recovered when the court finds that
mishap results to the death or some pecuniary loss has been
injury of the passenger and suffered but the amount cannot from
when the common carrier is the nature of the case be provided
guilty of fraud or negligence. with certainty.
• There is bad faith as to warrant award • Okay, so in these particular kind of
of moral damages when there is bad damage or those which cannot be
faith in securing or execution the quantified in monetary terms, those
 are temperate damages. It is at least • Also, take note of Article 2235 which
in the middle of actual damages and says that a stipulation renouncing the
nominal damages. exemplary damage in advance shall
be null and void.
LIQUIDATED DAMAGES

• Those that are agreed by the parties

in the contract
• Yan yung sinasabi natin kanina na
when there is an indication of an
amount of damage, that pertains to
liquidated damages in the agreement
of the parties.
• GR: Liquidated damages or those
agreed by the parties cannot be
changed by the court
• EXPN: If the amount is
unconscionable and when the breach
is not the one contemplated by the
parties in agreeing upon the
liquidated damages. In these
particular cases, the court will decide.

EXEMPLARY OR CORRECTIVE DAMAGE

• These are claims available only if

there is moral, temperate, liquidated
or compensatory damages
• It cannot be recovered as a matter of
right. This means that only after the
claimant’s right has been established
can you claim for exemplary or
corrective damages
• It is imposed only by example and
only in addition to compensatory
damages.
• Also, it could be recovered when
there is bad faith, done in wanton,
fraudulent, oppressive or malevolent
manner
• Take note of these requisites of
exemplary damages
CHAPTER 7- AIR TRANSPORTATION aircraft shall be eligible for
registration unless it is owned
• There are several applicable laws: or lease by Filipino Citizen or
o Civil Code citizens of the Philipppines, or
o Civil Aviation Authority Act of corporation or associations
2008 – this was the product of organized under the laws of
a new law after the civil the Philippines.
aeronautics act of the
• Can you register in two countries?
Philippines that created the
o No. You cannot register in two
CAP and the CAAB
countries simultaneously.
o Special Laws- Warsaw
• Is there any rule as to conveyance of
Convention, Montreal
an aircraft?
Convention, Chicago
o Just like in a regular
Convention
registration, we follow the
o Civil Aviation Regulations
mirror doctrine. That all
o RA 76
transactions that are involved
o Regulations by the Civil
with respect to the aircraft
Aviation Board
should be reflected or
o Treaties and Conventions
annotated at the back of
certificate of registration so
that it would be binding
• There are two governing agencies against third persons or to the
that handle air transportation: whole world.
o Civil Aviation Authority of the o Otherwise stated, kung wala
Philippines (this is the LTO yang transaction nay an at the
like) back of the certificate or if it
o Civil Aeronautics Board (this was not annotated, only the
is the LTFRB like) registered owner will suffer
• CAAP- When we talk about the the loss if anything happens
technical aspects, that is the CAAP. on the aircraft.
Like the LTO. So when you apply for o You register that conveyance
a license as a pilot you go to CAAP. and have it annotated with the
Mag-apply ka ng rehistro, you go to civil aviation authority of the
CAAP. Philippines from whom we
• CAB- but when we talk about the register our aircraft and which
economic aspects of air issues the certificate of
transportation, that is the CAB. It is registration.
the one in charge of regulation
affairs, approval of certificate of
public convenience AIR TRANSPORTATION

• Let us go to air transportation in

• What is the rule of eligibility of general.
registration? • What is the concept of air
transportation?
o Except as provided in the • In general, air transportation can be
Constitution and our laws, no either domestic or foreign. And it can
 either be scheduled or non- usually secured by those aircrafts or
scheduled air transportation businesses engaged in aerial
spraying or aerial photomapping
Air Commerce or Commercial Air
services.
Transportation
• Aerial spraying ay yung pag may
• It is either scheduled or non- plantation ka tapos gusto mo
scheduled air transport services and magpaspray. These aircrafts have
it should be for hire or secured a certificate of public
remuneration. The navigation of the convenience to do business or in the
aircraft is for business and for furtherance of business. Same with
operation in the conduct of a photomapping as that in a spy
business movies

• There are four things that I would For operation in the conduct of business
want you to remember here: • These pertains to companies who
have aircrafts that are being used for
o Scheduled or
transport of its own personnel.
o non-scheduled
o It is the navigation of an
aircraft in the furtherance of a
SOVEREIGN
business
o The navigation of the aircraft • From your political law, who owns the
for operation in the conduct of air space ?
a business o There is a particular provision
in the Chicago Convention as
• Let us go through them one-by-one. to who owns the airspace
o In it, it provided that every
state has a complete
Scheduled sovereignty over the airspace
above its territory. Therefore,
• These are the typical flight schedules consent is necessary for other
that we see in the airport. States in order for them to
• You go to the airport and see different operate in the territory of
kinds of schedules or you buy a ticket another.
and choose from the schedules o Whoever owns the land
available, that is scheduled air below, also owns the air
transport services above.
Non- Scheduled • When you fly over a particular
territory, you have to have permission
• What is referred to here are charters. for you to fly over that territory.
• For example, you want to go to Japan
Furtherance of business
and you are flying over the territory of
• This one, when we apply for a permit Korea, you have to get the
or certificate of public convenience permission of Korea for you to be
for furtherance of business, these are
 allowed to fly over that country in your well as PH carriers—PH
travel going to Japan. airlines, cebpac, and air asia.
• Those airlines that you see in our o During the air panel, the
country, they have been permitted by government and the private
our country to operate in our country. companies will talk. Sasabihin
It took steps and procedures before nila, “ilang beses kaya tayo
they are allowed to operate in our pwedeng lumipad sa
own country. Singapore? Ilan yung hihingin
• And that is where we talk about natin? Ilan yung pasaherong
bilateral system of air traffic pwedeng magpunta doon?”
negotiations. At the same time, si SG din
ganun. So that when thay will
talk during their bilateral
BILATERAL SYSTEM OF AIR TRAFFIC negotiations, each one will
NEGOTIATIONS demand against each other
but the key is reciprocity.
• In order for a State to have such right o Whatever we give, they give.
or consent over the use of airspace of Whatever we refuse, they
another, there has to be a bilateral refuse as well.
agreement which is called an air o What is contained in the air
services agreement so that they can service agreement which is
operate and use the air space of our the product of negotiation is
State and over another’s air space. the 9 freedoms of the air.
• Essentially, the product of the o This is where under PH and
bilateral air negotiations is the air SG are given certain
services agreement. freedoms for us to exercise
• It goes like this: when we say kanina over the airspace of another.
that it doesn’t happen over night, it is So yun yung 9 freedoms
because several negotiations have to which we will identify one by
occurred before one can be allowed one.
to fly in a country. For example, we
1st FREEDOM – RIGHT OR PRIVILEGE
have the Philippines and Singapore.
WITH RESPECT TO SCHEDULED
Because there is a good Filipino
INTERNATIONAL AIR SERVICES
market in SG, PH airlines which is of
GRANTED BY ONE STATE TO ANOTHER
Philippine Registry intends to operate
STATE TO FLY ACROSS THEIR
in Singapore in order to service
TERRITORY WITHOUT LANDING.
passengers and cargo. What will
happen is that PH airlines will talk to • This is the right of overflight. When
the Philippine government saying its you fly over a particular territory for
intention that it wants to fly to the purposes of flying over only.
Singapore. And our government, Dadadaanan mo lang siya hindi ka
goes to diplomatic channels to talk to babababa.
those in charge in Singapore.
o Bago mangyari yun, the PH 2nd FREEDOM- RIGHT OR PRIVILEGE IN
government will hold air panel RESPECT TO SCHEDULED
which is composed of all INTERNATIONAL SERVICES GRANTED
government stakeholders as
BY ONE STATE TO ANOTHER FOR NON • Here comes the controversial ones,
TRAFFIC PURPOSES. which begins from the fifth freedom.
• When we say traffic , it is when you FIFTH FREEDOM – GRANTED BY ONE
bark or disembark passengers. STATE TO ANOTHER STATE TO PUT
Therefore when it is for non traffic ibig DOWN AND TO TAKE ON THE
sabihin ay hindi ka kumukuha ng TERRITORY OF ANOTHER STATE THE
pasahero or cargo TRAFFIC COMING FROM OR DESTINED
• This second freedom are for TO ANOTHER STATE.
technical stops.
• In the fifth freedom, you will notice
• Kung nakasakay na kayo ng
that there are three countries. It
eroplano at natyempong medyo
givesyou the right to fly between two
mahaba ang biyahe , si eroplano
foreign countries on a flight
minsan nagtetechnical stops sa isang
originating from your or ending in
lugar for refueling, for example.
your own country.
• For example, before going to japan,
• Let us be more specific. We have
the PH went to korea for refueling .
again PH, KOREA, and JAPAN
Ibig sabihin nabigyan tayo ng second
• The PH may serve passengers going
freedom ni Korea to stop in their
to Korea, pick up passengers also
airport
going to Japan. Unlike to the second
THIRD FREEDOM – GRANTED BY ONE freedom which only pertains to
TO ANOTHER TO PUT DOWN IN THE technical stops at bawal magbaba at
TERRITORY OF ANOTHER TRAFFIC magsakay ng pasahero, in the fifth
COMING FROM THE HOME STATE OF freedom, pwede kang magbaba
THE CARRIER. atmagsakay papunta sa iyong final
destination. There are three countries
• Ito yung pinakabasic. The third involved.
freedom along with the fourth • In the PH, this has just been recently
freedom.
allowed. Like we have now delta flight
FOURTH FREEDOM- GRANTED BY ONE going to Los Angles from Manila via
STATE TO ANOTHER STATE TO TAKE ON Inchon.
THE TERRITORY OF THE FIRST STATE • Minsan, pag nakasakay ka ng
TRAFFIC DESTINED FOR THE HOME eroplano na long haul, madalas
STATE OF THE CARRIER meron kang stop over kung tawagin,
Minsan nagstop over kayo Nakita
• Ganito lang yan.Si third freedom niyo merong pwedeng sumakay,
from PH to SG. Si fourth freedom, merong pwedeng bumaba atdi na
paupuin natin siya. From SG to PH. bumalik sa eroplano. And then you
• The third and fourth freedoms ae go to your last destination which is
most basic freedoms granted in air japan for example. That means the
services agreement. PH has been given a fifth freedom
• Pwedeng mawala na yung first at right by the two countries so that it
second pero yung third and fourth can do such a transaction. Pick up
hindi mawawala yan. That is most and drop off such passengers for
basic freedom given, the right to fly to purposes of traveling to its final
and from two countries. destination.
SIXTH FREEDOM- the right or privilege of What is cabotage?
transporting while the home state of the
carrier traffic moving between two other • It refers to particular rights or
States. privileges as to the air services.
• First of all, cabotage is a right. When
• Si sixth freedom, pansinin niyo yung we talk about cabotage in general,
illustration. He came from a third you are given a right to service two
country, go back to your own country, points in one territory. You are an
pick up and drop off to a third country. outsider and you are given a right to
• It is a right of flight from a foreign service two points in one territory.
country to another while stopping in • When we talk about the 8th and 9th
one’s own country for traffic freedom, sige let’s read it first
purposes.
• Ang stop over mo is your own EIGHT FREEDOM- THE RIGHT OR
PRIVILEGE OF TRANSPORTING
country.
CABOTAGE TRAFFIC BETWEEN TWO
SEVENTH FREEDOM – GRANTED BY POINTS IN A TERRITORY OF THE
ONE STATE TO ANOTHER STATE GRANTING STATE ON A SERVICE WHICH
TRASPORTING BETWEEN THE ORIGINATES OR TERMINATES IN THE
TERRITORY OF THEGRANTING STATE HOME COUNTRY OF THE FOREIGN
WITH ANY THIRD STATE WITH NO CARRIER OR OUTSIDE THE TERRITORY
REQUIREMENT TO INCLUDE IN SUCH OF THE GRANTING STATE.
OPERATION ANY POINT IN THE
NINTH FREEDOM- THE RIGHT OR
TERRITORY OF THE RECIPIENT
PRIVILEGE OF TRANSPORTING
• Ito pa ang isang malaking kalokohan CABOTAGE TRAFFIC THE GRANTING
dito. STATE ON A SERVICE PERFOMRED
• Let’s say si PH airlines which is of PH ENTIRELY WITHIN THE TERRITORY OF
registry service country B and C only THE GRANTING STATE
without touching the PH.
• The 6th and 7th freedom are familiar
only in places in the European • Tignan muna natin yung
territory but not outside of Europe. pagkakapareha ng 8th and 9th.
Because in europe they are allies. • In your illustration, country B is being
May European Union tayo so it does serviced. Two points in country B.
not matter whether or not you are • Ang difference lang ay in the 8th
using your home country as your freedom, the airplane originated from
country of origin or using your home its home country. For example,
country at all. Like in the 6th and 7th Singapore airlines originated from
freedom. This is common in Singapore and then services two
European countries only. points in the PH, Manila and Davao.
That is the eight freedom.
• In the ninth freedom, Singapore
Airlines does not originate at all from
Singapore rather it has its based
• Now, let us go to the last two
operation in the Philippines and
freedoms and this is what we call
services Manila and Davao fro traffic
cabotage.
purposes.
• In both cases, the foreign carrier is o Pwede rin ang another
picking up and dropping off reason may be for security.
passengers in two points of that Bakit tagal abas pa ang
country. pwedeng pumasok sa ating
• REMEMBER: Cabotage is not loob kung pwede naming taga
allowed in the PH jurisdiction. It is loob nalang ang
prohibited. magserbisyo.
• In air transportation, cabotage right is • However, there is also an advantage
prohibited. As compared to maritime to this. That is, competition. If we
where cabotage is allowed in the PH allow foreign players to come in, that
jurisdiction. would challenge our domestic
• Later on I will explain to you why players to provide for better services
cabotage is allowed in maritime but at lower costs. While this is not yet
not in aviation. allowed at the moment, I can only see
• For now, please rest on the fact that one advantage and that is better
never has been there a time that competition.
cabotage was allowed and there is a • Please remember the word cabotage
firm policy by the government that for bar purposes.
cabotage will not be allowed.

• Why do you think is cabotage not

allowed in the PH jurisdiction?

o Anong marramdaman mo
kung ikaw ang nagmamay ari
ng isang hacienda at
angpipitas ng mga pananim
mo ay kapitbahay mo? Ganun
din ang cabotage.
o A foreign aircraft services
your territory. Why do you
think it is not allowed?
Because of economic
reasons. For profits. For
purposes of economy, why
would you allow a foreign
carrier to profit from our
domestic market.
o Insetad of allowing domestic
carriers to profit on our own,
we are allowing a third
person/country to get the
profits that should have been
pertaining to our domestic
players.
CHAPTER 8 (AIR TRANSPORTATION) and downgrading of
passengers
• Also requires extraordinary diligence
• Extraordinary diligence means the • Cathay Pacific v. Vasquez
obligation of the air transportation o It involves upgrading and
operator that the aircraft is air worthy. downgrading of passengers.
That the vessel has a competent o Sinabi jan na it is one of the
ca[tain and crew and that the captain examples of a breach of
and crew exercise the necessary contract
functions for safety of the o And the scenario there is
passengers. upgrading of passengers

• What is “air worthiness”? o In this case, spouses

Vasquez was bound to Hong
o The concept of airworthiness Kong. However, it is indicated
under the civil aeronautics in their ticket that their seat is
act, this means that the for business class. But the
aircraft, its components and business class was already
accessories are of proper fully occupied and the airline
design, safe, and constructed upgraded their seat to a first
in accordance with the law class.
and must stand the rigors of
the like. o In this upgrade, the SC held
o When we say airworthiness, it that it was a breach of
pertains to circumstances as contract because the cathay
to withstand the rigors of the pacific failed to consult
flight. Vasquez for the upgrade.
o Take note that this exercise of
due diligence is expected not o So dito, inupgrade na nga
only with respect to the care sila, sila pa galit. The couple
of passengers but also with here, spouses Vasquez,
the baggae---WON it was whoever they may be, ang
hand carried or in the custody dami nilang time at pera para
of the passengers, or it has i-elevate pa hanggang sa SC
been checked in. Both of yung fact na inupgrade sila.
these instances,
extraordinary diligence is o Kung tayo yun na mga
required. member ng society na mga
hampaslupa ng pilipinas,
• In which instances would you say that Kung tayo yung na-upgrade
there is a breach of contract? from business class to first
o In case of baggage which is class, sasabihin nalang natin
stolen or damaged; diverted sa mga kasama natin “see
to another place; baggage you later, k thnx, bye”.
was delayed as to delivery; in
case of offloading; upgrading
 o In this particular case, you will • Japan Airlines v. CA
note na meron kasi yata
silang mga kasama. So they o In this case, the flight was
did not want to be set apart cancelled because of the
from their companions in the eruption of Mt. Pinatubo while
flight. But who will be mad for they were on a stopover in an
being upgraded in a first class airport in Japan. In the ruling,
accommodation? Only the it was considered as a
spouses Vasquez. fortuitous event in which case
the common carrier has no
o This is one classic example control.
that not all things that is o The Sc then reiterated that
beneficial such as upgrading airline passengers must take
will not constitute breach of assumption of risk to such
contract and not all things mode of travel because it was
which are disadvantageous travel by air. Hence, the
are breach of contract. adverse weather condition
should be taken into
o This peculiar case is one consideration to cause peril
example that even if you are on the travel.
upgraded and that would • Based from this case, will fortuitous
have been beneficial for the event alone constitute breach of
parties, that still constitutes contract? Otherwise stated, if you
breach of contract. In the cancel because of a fortuitous event,
words of SC, just like any will that be breach ofcontract per se
other privilege, the priority for on the part of an airline company?
being upgraded could have o The common carrier will not
been waived by the Spouses be liable if it is because of the
and whatever their reason fortuitous event per se
was and however odd it may o Okay, so first scenario is that
be, the Vasquezes have it is not breach of contract if it
every right to decline the is a fortuitous event.
upgrade and insist on their • Is there a scenario that though it is
business class caused by a fortuitous event will still
accommodation. It should not be breach of contract on the part of
have been imposed on them common carrier? How?
over their vehement o Yes. If there would be failure
objection. to make arrangements. For
example in such case, the
flight was actually cancelled.
So it does not necessarily
• Ngayon, namention din yung delay mean that the duty on the part
and diversion of flight as a breach of of the common carrier has
contract. What is an instance where already been extinguished.
there is delay on flight? o In this case, they are actually
obligated to look for or look
after the convenience or
 comfort of their passengers. sa inyong flight, balikan ninyo itong
So they should make diniscuss natin.
arrangements which may
benecessary for the • So take note of these instances:
passenger such as the first
available flight so that the • With respect to flight cancellations, if
passenger can still arrive at the cancellation done at least 24 hrs.
their destination. before the estimated time of
o The carrier is still duty bound departure, and the fault is attributable
to safeguard the convenience to the carrier, you have a right to
of the passengers. rebook or to be reimbursed of the
o While they may not be liable fare.
for breach of contract
because of the fortuitous • If the cancellation is less than 24
event cancellation, what will hrous, presumably nasa airport ka na
constitute breach of contract nyan. Nandoon ka na at kinancel pa
is when they fail to exercise before the Expected Time of
that duty to provide Departure (ETD), and the reason is
convenience that should be attributable to the carrier, you have
given to the passengers. these rights:
o So with respect to delays take
note that fortuitous event is o Right to amenities
not equal to breach of o Right either to be reimbursed,
contract. It will only be equal to be indorsed to another
when the airlie forgoes their carrier or to rebook your ticket
duty to provide convenience. • Now ano yung amenities na sinsabi
natin?
o 1pc chicken joy kung
• Anoa no itong mga convenience na natyempuhan kayo ng lunch.
ito? Ito ay matatagpuan sa o Swerte niyo na kung one pc.
airpassengers bill of rights that was Chicken joy kasi dati sa air
mentioned in your book. This asia, meryenda time lang kasi
particular issuance is the first of its yata noon, bigay lang ay sky
kind in the sense that the PH is the flakes and mineral water
pioneering country that issued air o These are the amenities. You
passengers bill of rights. This is a are provided with meals and
joint circular between the DOT and refreshments
DTI to give or inform the passengers • What if the cancellation is due to
of several rights which we have. fortuitous event or for safety or
security reasons?
o You have a right to be
• Now very quickly, I want to discuss reimbursed of the full value of
the pertinent provisions because it your fare .
might happen to you. o With respect to
reimbursement, what is the
• So for practical purposes, kung practice nowadays is that you
mangyari ang delay or cancellation will not get the peso value of
 your fare. Rather, it will be waiting for take off, nakatulog
given or converted into a na kayo, akala niyo nandoon
travel fund. Bihira lang yung na kayo sa destination ninyo
makakakuha ka ng cash. pero pag gising niyo nandoon
Bibigay nila yun in the form of parin yung eroplano.
travel fund. o That is already tarmac delay.
o Especially in this time of the If it is already two hrs. after
new normal. The airlines ETD, you have a right for
nowadays have been amenities.
bombarded with a lot of o In fact, there is a new
requests for travel refund. issuance now saying that if
They cannot afford to give out you are already waiting fir
cash. The airlines will very long while you are on
definitely go bankrupt. board the aircraft and hindi pa
• So these are for cancellations nagtake off, the pilot needs to
disembark the passengers.
• What about delays? ▪ Why? Because there
were many instances
o You are already in the before where the
boarding area and the airline passenger
said that you are being complained of
delayed for this time. If the suffocation. Maybe
terminal delay is at least three the AC or ventilation is
hours, after the ETD, whether not working well. So in
or not the fault is attributable that particular
to the carrier, you have a right instance, we are going
again to amenities. to have to disembark
▪ You also have the the passengers.
right to be refunded or
to be endorsed to
another carrier. • What about baggage?
o What if the delay is already o There are many instances or
6hrs. after the ETD? you may have experienced it
▪ For causes already when your baggage
attributable to the has been damaged or lost.
carrier, consider your Take note that we will study
flight cancelled this along with waraw and
already. That means montreal convention because
the rights pertaining to in your readings of the APBR
cancelled flights, you (Air Passengers Bill of
will get those rights. Rights), if it is an international
flight, the rule is that the
relevant convention will apply.
• What if there is “tarmac” delay? What (so ididscuss ito sa warsaw
is Tarmac delay? convention and montreal
o Ito yung situation wherein group)
nasa loob ka na ng eroplano,
• Apart from that, are there any other o There are passengers who
reasons for breach of contract? are not able to check in even
o Another would be the rude after the payment of their
treatment of the staff, the ticket.
crew or even the branch o In fact, there are instances
officers of the airline. where in my experience, kahit
o Also, overbooking nakacheck in ka na sa airport,
di ka magaappear upon
boarding.
• What constitutes overbooking? o (Kwento ni Atty. Sa Korean)

o So overbooking is actually a
valid practice. The threshold • This is just a way to show you that
of 10% allowance is no longer overbooking is a valid airline practice.
applicable. There is no longer In fact it happened in the US and it
a threshold. However, turned out really bad.
overbooking, while it is a valid • Particularly, that incident involving
airline practice and it does not United Airline. There was an incident
actually constitute breach of where an Asian man, doctor yata
contract, again the airlines siya, he was refused to be flown. He
must not disregard its duty to was bumped off, and then when he
provide convenience. was requested to leave, nagkaroon
Overbooking per se will ng altercation, turned out nagwrestle
constitute breach of contract if doon sa eroplano. He was dragged
you will not compensate out of the plane violently. Sugatan
those who are not off loaded. siyang lumabas ng eroplano. Why?
o The consequence of Because he refused to be off loaded.
overbooking is overloading. • He was being off loaded because that
Or you are being bumped off. is the result of an electronic raffle.
Ikaw ang malas na ma-off load
• What happens when there is ngayon. But yun na nga, nagkaroon
overbooking? ng altercation.
o The airline has sold tickets • But I am telling you, this particular
more than the capacity of the incident will not happen in the
aircraft. Philippines. Bakit?
o Let’s say that the aircraft that o Because of our culture.
will fly you on a particular day
is an A3-20. That is a 180
seating capacity aircraft. • What will happen if there is
o The airline sold 190. Now ou overbooking after you request a
may ask, mam parang passenger for off loading? How
sobrang deceiving naman ng would airline solve overbooking?
practice nay un. o Those who shall be removed
o No it is not. Why? Because it from the booking shall be
is a common scenario that reimbursed with the amount
there are passengers who are
“no shows”.
 of the fare which they have heightened ang ating security
paid. protocols and now in the times of the
new normal, mas mahirap pa
because not only are we going to be
• This is the scenario of overbooking in subjected to security measures but
the PH. And this is why I a telling you, also health protocols.
that scenario in the US will never • So dalawa na, HEALTH and
happen. SECURITY and no body can be
o Because of our greedy exempted from that. There is an
culture. invisible war against covid and we
o (Remember yung example ni have to submit ourselves to health
ma’am, na may incentives for check.
voluntary off loading. The
stakes become higher as they
reach the number of
maximum persons to be
MARINE TRANSPORTATION
offloaded)
o Tayo ay likas na gahaman. • What maritime law?
Mahilig tayo sa libre. o These are laws which
o The Philippne culture will governs the affairs and
always succumb to the idea of businesses of the sea. The
auction system. ships, their crews and even
navigations.
o What are the laws governing
• Moving further, what about inspection maritime commerce?
of the aircraft or cargo? Is it a ▪ It is governed by the
requirement? Civil Code, particularly
o Yes. They need to inspect the provisions on
everything. It is different as to common carriers and
vessel. suppletorily the Code
o It is mandatory to put your of Commerce, and the
belongings in airport special laws.
scanners. o Special Laws such as:
• With respect to aircrafts, they are ▪ Carriage of Goods by
required to go through security Sea Act (COGSA)
procedures because we have the ▪ Savage law
Philippine Civil Aviation Regulations ▪ Ship Mortgage
(PCAR) which mandates us to do so. Decree
It is in consonance with the protocols
on dangerous goods issued by the
international civil aviation • Before we delve further into the meat
organization which requires all of this discussion which is the limited
passengers to submit to security liability rule, it is first proper to
checks. Because terrorism is consider the real and hypothecary
rampant in the air industry that is nature of martime.
what we have to guard against. Lalo
na noong height of 9/11. Lalong na-
• Hypothecary – means that the liability risk of being bankrupt because of the
of the owner of the value of the vessel claims of the shipper. Or anybody
is limited to the vessel itself. that is involved in the transaction. So
no, I will not engage on maritime
o In other words, kunin niyo commerce anymore. That is too risky
yung root word ng for me.
hypothecary. That is to • As you all know, yung voyage before
hypothecate. was more prone to sinking because
o To hypothecate means to we have no technology whatsoever.
pledge as a security. It implies
that the shipowner can free • So in order to avoid this situation, the
himself from liability arising framers of the law created the “limited
from maritime commerce by liability rule”
hypothecating the ship in
favor of the claiming parties.
• Real- it signifies the extent of liability.
It is limited only to the value of the • Limited Liability Rule – the liability of
vessel. Meaning to say, it is the shipowner would be coextensive
determined by the value of the ship— with his interest in the vessel such
its very res or the real property that the total loss results in its
involved in the endeavor. extinction. So the total destruction of
o Take it as yung res. Which is the vessel extinguishes the liens
the vessel itself. because there is no longer any res as
to which it can attach.
o In other words, no vessel, no
• Now, taken together, this is the real liability.
and hypothecary nature of maritime o Explained in plain terms, ang
law. Let us go back to history. isang barko kapag naglayag
• This doctrine is best understood if we may dala dalang cargo yan.
will go back to the origins of maritime Pag naglayag at nakameet ng
commerce. accident and the ship sinks
• Back then, the rule was, if you are a totally extinguished ang ship,
merchant and you start your voyage, since the rule is no vessel no
and during the voyage the vessel liability, the ship owner no
sinks completely, you will be liable to longer becomes liable.
your claimants even up to the extent Provided there is total
of your personal property. extinction of the ship.
• So the effect is you will go bankrupt. o Therefore, equally, there is
Kasi pwede kang simutin ng lahat ng total extinction of the liability
gusting magclaim because of the that the shipowner may have.
accident that happened. o Because going back to the
• This had the effect of deterrence. definition, your liability is
Naging deterrent siya sa mga limited only to the res or the
merchant. Because kung ikaw man, freightage that he has earned.
sasabihin mo, why would I engage in So that, when the ship is lost,
maritime commerce when I ran the there is no more res to which
 the liability can attach. Hindi o Classmate: Because they still
na liable si shipowner. do not own the ship
• Later on, you will know upon knowing o Atty: In other words, while
the exemptions, na hindi naman they may have possession
malulugi ang mga shippers. Because ovEr the ship or the
there are certain exceptions that we admnisitration of the ship for
have. the time being, it has no
• By the way, if you go to the code of complete dominion over the
commerce, take note of 587, 643 in ship. No sense of ownership.
rel. to 897 and 590. Beasides, as stated in your
book, it would be absurd to
apply the limited liability rule
against him who in the first
place should be the one who
is benefitting from the rule.
EXCLUSIVELY, ONLY THE
SHIPOWNER CAN CLAIM
• In Charter Party, May a charterer THE LIMITED LIABILITY
invoke limited liability in a case RULE AND NO ONE ELSE.
against him by the shipowner?
o Classmate: No. It is the
shipowner who is entitled to • However, let us look at the
the benefit. exceptions in the above stated
o Atty: Oh, why not a charterer? general rule:
Diba there is what we call a
bareboat demise charter 1. Where there is an injury or death of
wherein it is deemed that the the passenger due to either the fault
charterer is the owner pro hac of the shipowner or a concurring
vice, at the time of the negligence by the shipowner and
voyage. So why can it not captain.
claim the limited liability rule? - Bakit di magpply yung limited
o Classmate: because the liability rule?
limited liability rule existed - The shipowner has the burden of
because it intended to protect proving that the seaworthiness of
the shipowner. And it was the the vessel was not due to his fault
shipowner to whom the or negligence. In case of failure to
benefit should redown. overcome the presumption, the
o Atty: Can we extend that limited liability rule cannot apply.
privilege to the charterer - Of course, he will not benefit from
especially a bareboat or it if he is negligent because in
demise charterer? Diba you effect there is bad faith in his part
remember the concept of a tapos you will still be able to
bareboat and demise exempt yourself from liability.
charterer. Lahat lahat parang That is an undue advantage.
iyo yung barko. Why cant they - However, take note in this
claim the right? exception, that when there is
negligence between the
 shipowner and the captain, it - However, in insurance also you
should be concurring negligence. know that there is subrogation.
So that the limited liability rule
cannot apply. Any situation when
there is participation on the part of -does the limited liability rule apply in
the shipowner as to make the an action of the insurer in
ship unworthy, unseaworthy, the subrogation?
limited liability rule will not apply.
- However, if it was only the - yes. If the insurer exercises
negligence of the captain and his right to subrogation then he has
crew, the shipowner has the the same cause of action already.
burden of proving that that - the limited liability rule
unseaworthiness was not due to applies to the paying insurer in the
his fault . Either concurring or his exercise of his rights of subrogation
own fault. Dapat wala siyang against the shipowner. In the
bahid ng negligence in order to wordings of the book, the cause of
claim the benefit of the limited action of the insurer is the same
liability rule. cause of action which any shipper
may have therefore, the shipowner is
subject to available defenses of the
2. If the vessel is insured, the limited shipowner. In this case, the limited
liability rule is not applicable because liability rule as if he is the shipper who
it will be the insurer who will cover or directly sued the same insurer. So
pay for the damage. yes, the limited liability rule would still
- Naturally speaking, there is a apply.
contract of insurance between
the insurance company and the
shipowner 3. Workmen’s compensation. Where
- And it is a different contract from they are invoking claim under the
the contract of carriage which is workmen’s Compensation Act
the reason why there was a because the deceased members of
breach and that there was an the ship were caught by a typhoon.
accident. -so it is not covered by the limited
- Because of this, the limited liability rule because the workmen’s
liability rule does not apply to compensation is a compensation
insurance claim. Kasi iba yung arising from the employer-employee
nature ng duty ng insurer. He has relationship and not from the res or
to pay the passenger. He himself the vessel.
cannot say that I should not pay -in other owrds, it does not apply
the insurance claim because the because the liability sources are
ship was extinguished and different. One came from the statute
therefore no vessel, no liability. or the labor code or any applicable
No. That is not correct. because of their employment
- The insurer does not have that contract. The nature is employment.
defense. Only the shipowner has The other one is the breach of
that defense. contract of carriage. Walang
kinalaman yung sweldo ng captain
 and crew. Yung claims nila, they may because without it, the limited
still validly claim against the liability rule cannot apply.
shipowner even if there is no more o It is an indispensable
res to which the liability can attach. requisite.
Therefore the limited liability rule o So that if one does not want
does not apply in this particular to abandon his vessel, then
scenario. he cannot avail the benefits of
the limited liability rule.
• (Code of Commerce) ART. 587. The
4. For the expenses of repairs and ship agent shall also be civilly liable for
commissioning prior to the departure the indemnities in favor of third persons
of the vessel. which arise from the conduct of the
- This is sort of similar to the captain in the vigilance over the goods
reason why employer’s which the vessel carried; but he may
compensation claims are an exempt himself therefrom by
exception. abandoning the vessel with all her
- Why? Because the source of the equipment and the freight he may have
obligations or liability are different earned during the voyage.
o In article 587, it is explicit that
- What is the source of liability here
the ship agent or the owner
when it comes to accidents? It
may free himself from liability
would be for the repairs.
by abandoning the vessel if a
- In other words, there may be a
ship or part thereof exists.
contract of service for the repair
of the vessel to which the
shipowner has contracted with
the repairmen or other entity. • So that in case of collision, vessel A
Magkaiba yung pinaghuhugutan and B colliding with each other and it
nung liability ni common carrier appears that the ship has not totally
with respect to that repair and sunk yet, what will happen?
doon sa breach of contract which o The limited liability rule will
would give him the defense of not apply because the res is
limited liability rule. So in this still existing.
case, the limited liability rule does o However, limited liability rule
not apply. may already apply if there is
an act of abandoning the
vessel, its appurtanences and
freightage.
ABANDONEMENT
o The only instance where
• What is abandonement? abandonment was dispensed
o With respect to the limited with is when the vessel was
liability rule, when you entirely lost. In such a case,
abandon, you relinquish your the obligation is already
interest or renounce your extinguished. So much so
possession of the vessel so that if the vessel is still there,
you give up your interest over if it is partially there, there has
the vessel and it is an to be abandonment.
indispensable requirement
 o One is free from liability in the • But this case is intriguing for me.
sense that he is not liable • Do you think the common carrier is
beyond the value of the really negligent? Wag niyo muna
vessel he abandoned, its pansinin yung sinabi ng SC. But if
appurtanences, freightage, given the chance, do you think and do
earned furing the voyage and you agree that there is really
insurance if any. (this will negligence in this case?
answer for the damages or • Again there no right or wrong
injuries that are caused) answers.
o Take note that the limited • Dissenting ni Atty:
liability rule means that there o Disregarding the overloading
is no vessel. When there is no factor, let us focus on the
vessel, there is no liability. typhoon aspect of the case.
o If the ship is totally lost, the They said that they took a
liability of the shipowner is calculated risk and because
totally extinguished. of that, there was a
o If the ship or part thereof is negligence on their part.
existing,then one may escape Would it mean that everytime
liability by abandoning the there is a typhoon, the captain
vessel, and the properties of of the ship would forever be
the shipowner cannot be fearful such that they will not
reached by portions entitled attempt to start the voyage
to damages. anymore because there was
o And of course, take note of a typhoon?
the exceptions of the limited o Kasi parang ang lumalabas,
liability rule. parang imposible nang
maging caso fortuito ang
isang storm for that matter
Cases: because ang palaging
sasabihin natin, since alam
Vasquez v. CA
nating lahat na may bagyo, so
• Pioneer Lines was headed to Cebu. tuwing may bagyo wag
However, while traversing, a typhoon nalang lumayag. Ganun bay
suddenly struck. Typhoon Claring. un? Basically, I am presenting
• The petitioner’s children were lost you this issue because if you
and were never found. They then are confronted with a
filed an action against Pioneer Lines scenario in your bar exam,
because of failure to exercise where ang facts ay isang
extraordinary diligence. typhoon, I want you to be
• The ruling of the court was the critical with your approach.
common carrier was liable as to Almost always, ang sasabihin
make it negligent, thus providing ni SC on the matter ay hindi
exemption to the limited liability rule. siya caso fortuito kasi meron
• Sabi ng SC negligent siya kasi hindi naming weather bulletin and
raw caso fortuito, therefore limited there is negligence because
liability rule will not apply. you took the risk and
everything.
o However, there was one case and they hit a riff that’s why it
I remember, where the SC caused damage to the vessel.
said that it was co fortuito o Personally speaking, I would
because the crew and the say that based from the facts
captain did not know that the alone, parang may
tide would be that high as to extraordinary diligence
engulf the vessel. naman.
o But then again, under those o If you say that the common
facts, it still remains that the carrier is not negligent, make
typhoon is there. The officers sure that you are already
and the crew knew of the saying the elements of caso
impending typhoon. fortuito. “I am proving that it is
o So kung knowledge ang independent from human will
pagbabasehan natin, lahat ng and that it is impossible to
typhoon since alam naman forsee which is nearly
nating nandyan yan at impossible to say in the first
lumayag ka, kasalanan mo. place kas inga it is forseeable
o So this is me telling you guys nowadays.
that if confronted with that
kind of question in your Bar
exam, Make sure that you Negros Navigation v. CA
have a good reason for your
answer. • Itong Negros case may moral lesson
o Bakit siya nagging negligent? dito. Yung lawyer dito ay siraulo
Magbigay kayo ng facts as to magisip.
why that particular captain or
crew or shipowner is really
negligent. If there was • In the case, Ramon Miranda
overloading, magandang purchased from Negros Navigation
indication nay an ng Corporation four tickets who are
negligence. Doon kayo going to Bacolod City to attend to
maghinge ng sagot niyo. Kasi family reunion.
kung typhoon at typhoon din
lang, palaging may kasalanan • The tickets were for voyage of MV
ang common carrier. In fact, Don Juan. The latter collided with a
for me, kung hindi natin blast strait in Mindoro with an oil
titignan yung ibang aspekto, tanker owned by the PNOC.
in the facts of the case it says
there that every six hours, the • MV Don Juan then sunk. Respondent
captain and the crew would filed a complaint seeking damages
always check before they arising from the death of the four
cross to another island kung family members who were never
nandyan na ba yung bagyo. found. So there was only a
Until dumating na sila sa presumptive death.
isang point na although wala
pa talagang super bagyo, the • Petitioner contends that the four
typhoon was already nearing family members were not seen to
 embark the vessel. They allege that • Take note also, what’s funny in this
the mere purchase of the ticket case is another contention of the
cannot itself prove that these four petitioner that there couldn’t have
members of the plaintiff family are been an instance where there is a
really passengers. Yun yung witness who saw the other passenger
kontensyon nung abogado. Walang and the witness said that he was able
Nakita edi di sila pasahero. LOko to talk to that particular passenger for
loko. Kaya nga di Nakita kasi inanod three hours. If you become lawyers
na. make sure that your contentions are
reasonable.
• The SC said that Ramon Miranda has
no reason to claim that his family • Moral: Because of that negligence
perished in an event just to win an there is no limited liability rule that
action. People do not normally lie can apply.
about their family members dying just
for the damages. • Now, in respect of claiming against
the shipowner, is there any
• And also it would be difficult for the procedures that the claimants can
respondents to keep the existence of rightfully claim or enforced against
their relatives if indeed they are live. the shipowner?

• This was actually filed by ither o There is a limitation action in

claimants and applied the principle of the special proceeding for the
stare decisis. Case of Mecena’s was enforcement of the limited
applied. liability rule. That is under the
rules of procedure for
• The captain of the vessel was playing admiralty cases.
majong. Yung nagooverlook ng • How do we enforce?
vessel, he was not able to inform the o Are you familiar with the Trust
captain. Fund Doctrine?
o This is in relation with the
• Since there was equal negligence, enforcement that we are
Don Juan sunk after 15 mins. talking about. The concept is
like the insolvency of a
• So in this case, there was negligence corporation. In terms of
on the part of the vessel in the sense enforcing, how do we claim
that the captain was playing majong; against an insolvent
the crew failed to inform the captain corporation? Is there any
of the collision; there was also reason, purpose, or basis for
overloading. that claiming?
o Under the Trust Fund
• Ngayon, these all combined factors Doctrine, it’s like this. There is
of negligence on the part of the a fund that the corporate
shipowner, therefore making it an stock holders have a right to
exception to the limited liability rule. look up to in case the
corporation becomes
insolvent for the enforcement
 of their claims. Akin to a captain believes that the
vessel, if the vessel or rather cargo has suffered damages.
a shipowner has no more o 4. In cases of maritime
assets to answer for the collision
liabilities because of the • In all these cases, a protest is
claims of the parties, necessary. The definition provided is
whatever is left, it will be given correct. It is a written statement given
to them proportionately if the by the master of the vessel or any
assets are not enough to authorized person and it is attested
satisfy their claims. It will be by proper officer to the effect that
just like in an insolvent damages has been suffered by the
corporation, the answer for ship. The protest is needed bythe
their claim will be given to filing of any suit or damages in case
them proportionately. of the instances provided above.
o No claimant can be given
precedence. What will • What is the reglementary period?
happen is that there will be When should we file a protest and
collation of all the properties where?
left and no claimant can be o Within 24 hours
given precedence over the o Should be filed to a
other claimants. And for the competent authority at the
execution of the judgment, it collsion
will be put or deposited in trust o If it happens in the PH, it
and will be given should be at the first point of
proportionately to the arrival.
claimants. o If outside the PH, file it with
o That is the procedure. the PH consul

PROTEST

• What is protest? Is it necessary?

When do we file it?
• Protests are written statements made
by the master of the vessel or its
authorized officer attesting that there
is damage suffered by the ship and
such document must be attested and
notarized by proper officer.
• When is protest necessary?
o 1. When the vessel makes an
arrival under stress
o 2. When the vessel is
shipwreck
o 3. When the vessel has
suffered from hurricane or the
CHAPTER 11 – VESSELS • Under Art. 415 (list of real property),
is there anywhere that we can find the
• What is a vessel?
word vessel?
o A vessel or a water craft
o None. Meron jan barges.
under PD 474 refers to any
o And if it is not found under
barge, lighter, a bulk carrier,
415, where do we go? Article
passenger, ship, a tanker, or
416 (list of personal
other artificial country bands
properties) which classifies
utilizing any source of motor
movable properties.
power designed, used or
• But more specifically, there is a
designated to be used for the
specific provision under the Code of
transport of goods, for
Commerce.
transportation, operation
o Art. 585. For all purposes of
either common contract
law not modified or restricted
carrier, inclusing the fishing
by the provisions of
boats. But it excludes those
this Code, vessels shall
operated and owned by the
continue to be considered as
AFP, those used by foreign
personal property.
government for military
• Being personal property, vessels are
purposes, those bancas, sail
subject to chattel mortgage.
boats and water boats
However, take note that even if it is a
country bands of less than 3
chattel mortgage, it has to be entered
gross tons in capacity and not
in the record of the Collector of
authorized.
Customs. It partakes the nature of a
o From the above definition, it is
real property in the sense that the
clear that not all floating
transfer has to be in writing and
structures are vessels.
recorded in the appropriate agency.
o Hindi lahat ng lumulutang sa
dagat ay vessel.
• What is the appropriate agency? In
• The reason in determining what is a
case there is acquisition or transfer of
vessel is to determine whether or not
a vessel, where do we register? Who
it is covered by the maritime law and
has jurisdiction over such
the Laws and Regulations of
transctions?
MARINA.
• Moinor crafts engaged only in river or
o In case of sale or transfer, it
bay traffic are not covered. So these
has to be approved by the
are boats that carry passengers from
MARINA or the Maritime
ship to shore, hindi sila kasama .
Industry Authority.
They are governed by other laws as
to their liability, the provisions of the
civil code and other special laws.
• How is a vessel acquired or
• More importantly, how do we transferred?
consider vessels? Is it real or o It may be acquired or
personal property? transferred through sales,
donation, or prescription.
o Personal Prooperty o Sabi sa book, it may be
transferred by any of the
 means recognized by law. But may be acquired via sale. In fact
there are other modes by there may be actual or constructive
which the vessel cannot be delivery but the sale must always be
transferred. Meron jan registered with the MARINA in order
intellectual creation. Di for it to affect third persons.
naman kasama yan. • Just like in our discussion in the
transfer of other transportation, it has
• Anyway, we have prescription. to be registered in the proper
Vessels are acquired through regulatory agency so as to affect third
prescription either ordinary or persons and bind the whole world.
extraordinary. • Whatever transaction there is, it must
o In case of ordinary be annotated at the back of the
prescription, it is required by certificate so that all persons know
law that the person who is what is happening with the vessel.
claiming ownership over it Otherwise, there is what we call the
must be in possession in registered owner rule where it is only
good faith for a period of three the registered owner who will be
syears. liable and not other persons as being
o A person is in good faith if he claimed by the registered owner to be
has no knowledge of any liable on that particular property.
defect or flaw in his or her title. • So those are the important aspects
o In case that person is when it comes to vessel.
claiming ownerhip under bad
faith, the prescriptive period
required by law is 10 years. SHIP’S MANIFEST
• For one to be a possessor in good
faith, that is a possessor in the • What is a manifest?
concept of what? o It is a declaration of the entire
o In the concept of an owner. cargo of the vessel. Its
• When is one in the concept of an purpose is to provide a
owner? customs officer a list which
o He is a possessor in the will serve as a checklist.
concept of an owner when he Likewise, it serves the
is not aware of any defect in revenue officers the details of
his title and that he believes the cargo which the vessel is
that he is the owner of such bringing into a port.
property. o A manifest is required in
• May a lessee, usufractuary, trustee coastwise trade vessel.
be called a possessor in good faith? o It provides for a checklist in
o No. Because they order to know what is brought
acknowledge that there is in the port.
somebody who has a better o Manifest is for the entire
title than theirs. cargo.
• In extraordinary prescriotion, • Instead of manifest, pwede bang bill
remember that the condition is of lading nalang? Total dinedescribe
continuous possession for ten years. niya rin nmaan yung cargo?
Other than that, it is also true that it
 o No. A bill of lading will not CABOTAGE
have the same effect since for
the bill of lading, the • Balikan muna natin yung general
declaration is only for a concept ng cabotage
specific cargo. • What is a cabotage?
• A bill of lading cannot replace a o Cabotage is the transfer of
manifest. But can a manifest replace goods and passengers from
a bill of lading? different ports of one country
o No. Since a bill of lading by foreign vessel
represents a receipt. While a o It is a right. And the right of
manifest does not have the cabotage is given to a foreign
same function. vessel for it to be able to
o You will go back to your transport between two points
characteristics of a bill of in one territory.
lading, It is a receipt. It is a • Cabotage is allowed in air
contract. And it is a document transportation. Is it allowed in
of title. So much so that the maritime commerce?
bill of lading may not be o As to cabotage of
replaced by a manifest passengers, it is not allowed
because while a manifest but under the current law
describes the whole or entire signed by the president, the
cargo, the bill of lading would cabotage of a cargo is
still be your best proof as to allowed in the PH.
the goods being transported • Why are we allowing cabotage in
by the carrier. maritime commerce but not in air?
o It is issued by the common o The keyword here is MSME
carrier in favor of the shipper o The MICRO-SMALL and
and that is a different matter MEDIUM ENTERPRISES
as compared to the purposes who are the key benefactors
of a manifest. of the law allowing cabotage
• Take note also that with respect to in maritime commerce.
manifest, there are certain rules that o It would be more costly if we
we have to consider: avail air transportation.
o 1. Total number of Especially so that we are
passengers shall not exceed talking about the MSMEs.
the total number of o Here is a situation:
passengers for the ship ▪ If for example you are
o 2. All passengers on board a merchant, a small
should be manifested business owner from
o 3. The manifest should be Davao City and you
prepared and made available have goods to
before the ship leaves the transport to Cebu.
port. ▪ You know for a fact
that there is a nearby
foreign vessel in
Malaysia that can
service your goods
 from Davao to Cebu.
In fact, it is for a lesser
cost. Rather than
going to the airport
shipping your goods
from Davao to Cebu.
▪ It is for the benefit of
MSMEs that’s why we
are allowing
cabotage. Because it
would be cheaper to
get via a neighboring
countries help.
Because at the end of
the day, who will be
benefitted from this? It
is the end consumer.
▪ If we will allow
cabotage in air
transportation, the
prices of goods that
could be transported
via air , pwedeng
thrice. So ang talo
dito, si end consumer.
▪ Kung kukunin natin
yung factor na mas
mababa ang magiging
cost, mas mababa rin
yung presyong
ipapasa sa end
consumers.
▪ That is why we are
allowing it for the
benefit of MSMEs.
▪ Obviously, kaya ka
nga MSME kasi
generally you cannot
afford to transport it
via air because of its
costly freightage.
▪ Air freight is very
costly. It will not be a
good idea for MSMEs
to go via air freight.
CHAPTER 14 – CHARTER PARTY from the shipowner himself.
However, it is understood that the
• What is a Charter Party? agents are under the supervision or
o It is a contract whereby an control of the charterer and he will be
entire ship or a portion thereof the one liable for the expenses of the
is lend by the owner or voyage including the wages of these
merchant to another person crew including the captain himself.
for a specified time or voyage
or for the purpose of
conveyance of goods in
CONTRACT OF AFREIGHTMENT
consideration of freight.
o It involves both goods and • It consist of the time charter and the
passengers voyage charter. A time voyage is
• Who are the parties to a charter party when the charterer lease a vessel for
agreement? a fixed period of time. The charterer
o A charterer has only a right to utilize the facilities
o Shipowner of the charterer and to designate her
designation during the term of the
charter.
Two kinds of charter party: • While a voyage charter, the charterer
only lease a vessel for a single or
1. Bareboat or Demise Charter
particular voyage only.
2. Time Voyage or the Voyage Charter

• As between the two, which one

BAREBOAT OR DEMISE CHARTER
remains a common carrier and which
• Here, the entire vessel is lend by the is converted to a private carrier?
owner to the charter party. The
command, possession, is transferred o Bareboat or Demise – private
to the charterer. carrier
• In other words, this is where we say o Contract of Affreightment –
that the charterer becomes the owner does not affect the character
pro hac vice or “the owner for the time or nature of the common
being” carrier
• What is important here is the word
“bare” • What is the consequence of
o Because the ship owner is not determining whether or not the vessel
required to provide him the retains its identity or is converted to
crew, therefore the charterer private carrier?
gains possession of the o Because it will affect the
vessel. Bare na bare. presumption of negligence
o Hubad lang siya. o Because when the Contract
o Thus he becomes the owner of Affreightment, if it is
pro hac vice retained as a common carrier,
• Consequently, the crew are agents of the moment an accident
the charterer, he is the one who hires happens. There is already a
for them. Howeve, he may get it also presumption of negligence.
 o As compared to bareboat or
private carriage where there
is no presumption • Once a charter party contract has
entered into by these people, there is
• What is the effect if there is no
already a contract existing between
presumption?
the charterer and the shipowner.
o The court needs to make an
express finding of fault on the • Therefore being a contract, it is
part of the carrier. governed by the rules on ordinary
o Versus a common carrier, contract, where the parties are free to
where the court no longer stipulate so long as it is not contrary
needs to make an express to law, morals, good customs or
finding of fault. public policy.
• Now there are requisites. For valid
charter party agreement what are the
formalities?
• Under what instances may the vessel
o 1st – consent
be chartered? Who may charter the
o 2nd- object must be the vessel
vessel?
o 3rd- the consideration must be
o It is the owner of the vessel
the freight
who has the legal control and
• Also, under the code of commerce, it
possession of the vessel that
also requires that it must be in writing
who may charter touch
signed by the parties and there must
vessel.
be a duplicate copy
o Also, the charter party may
also subcharter if there is no
prohibition in the contract that
he may charter such, • Just a few more points in this matter,
o Also, the part owners are not in determining the kind of charter
precluded to enter to a charter party, what is actually controlling is
party. the intent of the parties.
o In general, the ship agent is
not allowed to enter into a • It is shown in the stipulations of the
new charter howeverthere are contract between them. However, the
exceptions: title or the name denominated by
▪ When the shipowner them shall not be controlling. You
allows him to do so look into the stipulations that would
▪ Through a resolution give out the intention of the parties.
of the majority of the The parties may call it a voyage
shipowner charter but it may nevertheless be
▪ Through a Contract of treated as a demise or bareboat
Appointment charter therefore converting the
o The captain or the master of character of the carrier from common
the vessel, he has the carrier to private carriage. So look at
inherent right to enter into a the intent.
charter party but only ifthe
consignee or ship agent is • The charterer must prove that the
missing charter party is not a demise or
bareboat charter. Otehrwise, the
 charterer will be made liable because and when the goods ordained not
the charter party will be treated as a loaded or unloaded, the
demise or bareboat. compensation is called demurrage.
• In this case, who will be liable to pay
• Importante ang intent of the parties. the demurrage? It is the charterer
Otherwise, the charterer will be made who shall answer the demurrage that
liable because the charter party will are incurred.
be treated as a demise or bareboat • Lastly, let us talk about the bill of
charter. lading v. a charter party agreement.

• Now, there are certain points

mentioned in your book such as BILL OF LADING V. CHARTER PARTY
freightage not being due. AGREEMENT

• We will better understand this topic • Which of the two will prevail?
on jettison, on ship wreck, stranding, o The charter party agreement.
as well as sea shore in the remaining • Why?
chapters. o A charter party agreement
contains stipulations agreed
• Jettison is basically when the goods upon by the parties while the
are thrown off the vessel in order to bill of lading only represents a
save the vessel. Kailangan isalba proof of receipt as a contract
para gumaan, itatapon yung mga between the vessel and the
goods. Basically freightage here is consignee.
not allowed same thing with • Again, we will go back to the
shipwreck and stranding. Also when characterics of a bill of lading. The
the boats are seized by pirates and three-fold characteristics of a bill of
other enemies. lading. Among which is that it is a
contract between the parties. But
take note that its not a contract
contract per se. As to be the binding
CHARTER PARTIES agreement of the parties.
• In this case, it is the charter arty
• Lastly on charter parties we have agreement which is the main contract
demurrage which we had made between the parties. So much so that
mention before. if there is a conflict between the two,
• What is demurrage? the charter party agreement will
o Demurrage is the payment for prevail. The bill of lading merely
detention of the vessel for being a representation of the receipt
loading and unloading of goods or document evidencing the
beyond that it is allowed in receipt of goods between the party.
the contract.
• Anong tawag dito sa period
stipulated?
o Lay Days
• So that sum of money due under the
terms of agreement, it is detained
LOANS ON BOTTOMRY AND • A loan on bottomry or respondentia
RESPONDENTIA shall be considered as that which is
the repayment of the sum loaned
• The concept of loan is not new to you.
depends on the safe arrival of the
All we have to do now is to distinguish
goods or the vessel.
it from a simple or ordinary loan.
• Para lang mas malinaw, let us go
• Punta muna tayo sa general concept
thorugh the requisites or elements of
ng loan on bottomry or respondentia
a loan on bottomry or respondentia

What is bottomry?
• What are the elements or requisites
• It is a contract where the shipowner for us to say that there is a loan on
borrows money and uses his vessel bottomry or respondentia?
as security for the loan. (Kailangan alam niyo yan kasi it may
• Is there a condition for payment and be that you are presented with a case
what is the thing being used by the pero ordinary loan lang pala.
loan? Otherwise stated, what is the Therefore the consequences are
thing hypothecated or pledged? different)
o With respect to bottomry,
they are in the nature of a o 1st – shipowner borrows
mortgage (both loans on money for use, equipment
bottomry and respondentia) and repair of the vessel
are in a nature of a mortgage o 2nd – there is a definite
predicated on a marine risk, time/period agreed upon by
o The only difference between the parties and there is what
the two is that in bottomry, we we call the premium. There is
are talking about the ship an extraordinary interest
itself and the condition is that called the premium.
when the lender shall lose his o 3rd- the thing being pledged is
money. He will lose his the vessel itself
money when the ship is o 4th – the loan repayment is
damaged or entirely lost. conditioned upon the safe
o If the ship does not return, the arrival of the vessel or goods.
lender loses his money. The obligation to pay will be
• Let us compare this with extinguished if pledged goods
respondentia. or vessel are los. Now, the
o Respondentia is when both obligation to repay is
the vessel and the cargo are extinguished if the vessel is
treated as collateral lost due to s specified marine
• Again, another point of clarification. peril in the course of the
Bottomry is exclusively for the vessel. voyage or within a limited
Respondentia is exclusively for the time.
goods. In both, it is a form of a ▪ Question: If you are a
mortgage where there is a pledge, lender, why would you
either the ship or the cargo and there risk knowing that you
is a condition upon safe capital. will lose your money?
So much so that if the
 vessel does not does not survives the lender
return, you will not get will lose out his money
paid?
▪ Answer: Because
there is an • Now, speaking of extraordinary
extraordinary interest. interest, di ba may usury law tayo?
The payment of the What is then the effect of that
premium plus interest, extraordinary interest that we are
pag bumalik sayo talking about with respect to the
sobra sobra. regulations related to our usury law
▪ Question: if you are which prohibits high or unreasonable
the borrower, aside interest?
from the fact that you o In the case of bottomry or
need the money, bakit respondentia, they are not
ka sumusugal ng subject to usury law.
paghiram ng pera with o This is the big comparison
extraordinary with a simple loan which is
interest? subject to usury law.
▪ Answer: Ikaw naman o Usury law covers transaction
as a borrower, you where the principal sum shall
want to get that be repayable absolutely and
money in order for you at all events.
to venture into that o The loan on bottomry and
business or voyage. respondentia are not covered
Ofcourse, sino ang because the repayment is
vessel owner na ayaw subject to a particular
makabalik ang sarili contingency. If the vessel or
niyang vessel? Hindi cargo is lost, the lender shall
mo naman lose the principal and the sum
ipagprepray n asana loaned.
hindi nalang o So one big difference
makabalik yung between loans on bottomry
vessel mo so you will and respondentia and that of
not pay the amount a simple loan is being
loaned. Walang subjected to the usury law.
ganun. So ikaw, as a
vessel owner, your
wish is still to be able
• Irerelate natin yan mamaya when we
to pay because that
talk about averages.
means that the vessel
• Simply speaking, when we say
and goods have
averages, it came from the Spanish
arrived safely.
word “aberya”. From our common
▪ So it is actually a win-
layman, diba kasi pag may aberya,
win situation.
may problema . Ibig sabihin
kailangan natin ng danyos at
o 5th - , then the lender shall
pagsesettle kapag may aberya. So
recouped his money but if it
 averages daw came from the word • Since they do not inure to the
aberya. common benefit, the owner of the
• But plainly speaking, it is simply just goods or the person who is directly
averaging. By common layman’s affected who suffers the damage
term it is just really averaging and bears the loss.
later on you will know why there is a
need of averaging when it comes to
expenses related to maritime risks or • Before we delve further, simple lang
perils. po ang simple or particular average.
The concept is “to each his own”

AVERAGE • “to each his own”- if your goods are

damaged, you will be the one to bear
• What is an average?
the lost. It did not inure to the benefit
o It is a principle in maritime law
of anybody. You will not get paid and
whereby all stakeholders in a
you will bear the lost.
sea venture proportionally
share any masses resulting
• In tagalog, “malas mo, malas mo”
from a voluntary sacrifice of a
part of the ship or cargo to
• For example: merchandise. Part of
save the whole in case of an
the cargo got wet. Who will bear the
emergency.
loss?
o So these are ordinary
expenses incident to the
o The owner of the goods will
navigation of the sea which
bear the loss.
are to be defrayed by persons
o How about if anyone will
having interest unless there is
benefit from the merchandise
a special agreement to the
getting wet? It will become a
contrary.
general average.
• There are two kinds of Averages:
o But in this case, since no one
o 1.
benefitted, it is just a simple
o 2.
average in which the owner of
the merchandise will be the
one to bear the loss.
Simple or Particular Average

• These are averages which does not • Another example: there are mangoes
incur to the benefit of all persons transported from Guimaras to Manila.
interested At the point of reaching the Manila,
• Can you give me a clearer example? the mangoes tend to be over riped
o Example the wages of the and unfit for human consumption.
crew at the time that the Who will bear the loss?
vessel is detained o The owner.
• Basically, who wil bear the o Did anyboday benefit on the
expenses? over riped mangoes being
o The owner or the lender unfit for human consumption?
None. So to each his own.
Who will bear? The person
 who suffered the damage. push away a person in order
Malas mo, Malas mo. That is to lighten the load of the ship.
the basic concept of a simple Jettison is only for cargoes.
or particular average. Not for passengers.
• Now, let us go to general or gross • Who bears the general average?
o The general average shall be
borne by all parties who
General or Gross Average benefitted.
• Just one important note on general
Elements: and particular average:
1. There must a common risk before the o Obviously, those interested
sacrifice. are the vessel owners and the
• Here, there must be a sacrifice. But owners of the good.
before the sacrifice, there must first o Any other people who might
be a certain risk involved. be liable for averages? The
• Take note that this risk is not any risk insurers and the lenders.
but a common risk. A danger or risk
that is common to those having
interest on the vessel and its cargo. • Punta tayo, balikan yung kaalaman
2. There is deliberate or voluntary niyo sa lenders on bottomry or
sacrifice respondentia. How are they affected?
3. There is successful saving What is the extent of their
4. Before the deliberate sacrifice, there participation?
must first be a legal procedure o Lenders on bottomry and
respondetia have an
obligation to pay in proportion
• Sabi niyo, successful saving. Now to their respective interest in
comes the concept of jettison. both general and particular
average. (Art. 732, Code of
Commerce)
o In the case of particular
• What is jettison? average however, take note
that the lenders may free
o The act of throwing away the themselves from liability from
cargoes in the ship for the contribution if there is an
purpose of saving the ship. express stipulation to that
o So we are trying to lighten the effect.
ship to estabilize it. Just like in
• Example para mas malinaw: Let us
real life, tanggalin mo ang
say that the value of the cargo is 1
lahat ng mga pabigat in order
Million pesos. The loan is 500,000.
to save your own life.
Ilang porsyento ng isang Million ang
o Take note that there is no
500,000?
jettison of passengers. You
o 50%. Now, here comes
cannot throw off passengers.
general average expenses
Please do not jettison human
amounting to 100,000. In
life. Kahit gaano pa kayo
relation to what we have said
kagalit sa isang tao, do not
regarding art. 732, how much
 will the lender suffer for the gross average, there should be the
loss? existence of certain steps
o We said that his liability will be undertaken: 1. Bill of lading – it
proportionate. So since we should be proved that they are part of
have 50%, if you lent the cargoes as well as an inventory
500,000, 50% ng general prepared before the departure.
average would be how much? • So yun lang.
50,000. Which is in proportion
to the interest of his cargo
50%. • Pagdating sa general average, take
o No computation in the finals. note of the important elements which
are common danger, deliberate
sacrifice, and that the sacrifice must
be successful.
• Among the requisites that we have
mentioned a while ago, we aid that
there must be a successful saving of
the vessel and the cargo. What will
happen if there is no such successful
saving?
o There is no average if there is
no successful saving.
o First of all, with respect to
general average, the basis
here is founded on equity.
• US jurisprudence says that whatever
is sacrificed for the common benefit,
it shall be made good by all the
interests which are exposed to the
common peril and which are saved
from the common nature by the
sacrifice. So the foundation is equity.
• Ngayon, basically kapag nagbenefit
ka, you have the responsibility to
make good the loss of others.
• Now, another thing with respect to
successful saving is that if there is no
successful saving, there can be no
general average that can be funded.
• The acrifice must be successful.
• If despite jettison, the vessel was lost,
there is no gross average and no
general contribution that can be
involved, and regarding the
formalities, in order that the goods
jettisoned shall be included in the