Transportation and maritime law

Bill of Lading vs Charter party

1. Charter party - entire or complete contract

B/L - private receipt which the captain gives to accredit that such goods belong to such persons

2. Charter party - consensual party, which can be dissolved by means of indemnity for losses and damages

B/L - real contract; exists only after delivery of the goods to be transported is made
1. Contents
Art. 706. The captain and the shipper shall have the obligation of drawing up the bill of lading, in which shall be stated:

1. The name, registry, and tonnage of the vessel.

2. The name of the captain and his domicile.

3. The port of loading and that of unloading.

4. The name of the shipper.

5. The name of the consignee, if the bill of lading is issued in the name of a specified person.

6. The quantity, quality, number of packages, and marks of the merchandise.

7. The freightage and the primage stipulated.

The bill of lading may be issued to bearer, to order, or in the name of a specified person, and must be signed within twenty- four hours after the cargo has been received on board, the ship­per being entitled to demand the unloading at the expense of the captain should the latter not sign it, and, in any case, the losses and damages suffered thereby.

Art.707. Four true copies of the original bill of lading shall be made, and all of them shall be signed by the captain and by the shipper. Of these copies the shipper shall keep one and send another to the consignee; the captain shall take two, one for himself and the other for the ship agent.

There may also be drawn as many copies of the bill of lading as may be considered necessary by the parties; but, when they are issued to order or to bearer, there shall be stated in all the copies, be they the first four or the subsequent ones, the destination of each one, stating whether it is for the ship agent, for the captain, for the shipper, or for the consignee. If the copy sent to the latter should have a duplicate, this circumstance and the fact that it is not valid except in default of the first one must be stated therein.

Art. 713. If before the delivery of the cargo a new bill of lading should be demanded of the captain, on the allegation that the failure to present the previous ones is on account of their loss or for any other just cause, he shall be obliged to issue it, provided that security for the value of the cargo is given to his satisfaction; but without changing the consignment and stat­ing therein the circumstances prescribed in the last paragraph of Article 707, when dealing with the bills of lading referred to therein, under penalty, should he not do so, of being liable for said cargo if improperly delivered through his fault.

Art. 714. If before the vessel puts to sea the captain should die or should cease to hold his position through any cause, the shipper shall have the right to demand of the new captain the ratification of the first bills of lading, and the latter must do so, provided that all the copies previously issued be presented or returned to him, and it should appear from an examination of the cargo that they are correct.

The expenses arising from the examination of the cargo shall be for the account of the ship agent, without prejudice to his right of action against the first captain, if he ceased to be such through his own fault. Should said examination not be made, it shall be understood that the new captain accepts the cargo as it appears from the bills of lading.

2. Probative Value

Art. 709. A bill of lading drawn up in accordance with the provisions of this title shall be proof as between those inter­ested in the cargo and between the latter and the insurers, evidence to the contrary being reserved by the latter.

Art. 710. If the bills of lading do not agree, and no change or erasure appears in any of them, those in the possession of the shipper or consignee signed by the captain shall be proof against the latter or ship agent in favor of the consignee or the shipper; and those possessed by the captain or ship agent signed by the shipper shall be proof against the shipper or consignee in favor of the captain or ship agent.

B/L - proof of the agreement between the parties

Issuance of B/L is merely prima facie evidence of the receipt of the merchandise by the carrier or his agent; not conclusive evidence

Defective and irregular B/L may be cured by other complementary documents

G. PASSENGERS ON SEA VOYAGE
1. Nature of Contract
Art. 695. The right to passage, if issued to a specified person, may not be transferred without the consent of the captain or of the consignee.
2. Obligations of Passengers
Art. 693. If the passage price has not been agreed upon, the judge or court shall summarily fix it, after a statement of experts.

Art. 699. If the contract is rescinded, before or after the commencement of the voyage, the captain shall have a right to claim payment for what he may have furnished the passengers.

Art. 704. In order to collect the fare and expenses of sustenance, the captain may retain the goods belonging to the passenger, and in case of their sale, he shall be given preference over other creditors, acting in the same way as in the collection of freightage.

Art. 694. Should the passenger not arrive on board at the time fixed, or should he leave the vessel without permission from the captain, when the latter is ready to leave the port, the captain may continue the voyage and demand the full passage price.

Art. 700. In all that pertains to the preservation of order and discipline on board the vessel, the passengers shall be subject to the orders of the captain, without any distinction whatsoever.

3. Rights of Passengers

Art. 697. If before beginning the voyage it should be suspended through the sole fault of the captain or ship agent, the passengers shall be entitled to have their passage refunded and to recover for losses and damages; but if the suspension was due to an accidental cause, or to force majeure, or to any other cause beyond the control of the captain or ship agent, the pas­sengers shall only be entitled to the return of the passage money.

Art. 698. In case a voyage already begun should be interrupted, the passengers shall be obliged to pay only the fare in proportion to the distance covered, and without right to recover for losses and damages if the interruption is due to a fortuitous event or to force majeure, but with a right to indem­nify if the interruption should have been caused by the captain exclusively. If the interruption should be by reason of the disability of the vessel, and the passenger should agree to await the repairs, he may not be required to pay any increased price of passage, but his living expenses during the delay shall be for his own account.

In case of delay in the departure of the vessel, the passengers have a right to remain on board and to be furnished food for the account of the vessel, unless the delay is due to an accidental cause or to force majeure. If the delay should exceed 99ten days, the passengers requesting the same shall be entitled to the return of the fare; and if it is due exclusively to the captain or ship agent they may furthermore demand indemnity for losses and damages.

A vessel exclusively destined to the transportation of pas­sengers must take them directly to the port or ports of destina­tion, no matter what the number of passengers may be, making all the stops indicated in its itinerary.

In the Philippines, there is no law which requires shipowners to publish a schedule of the arrivals and departures of their vessels in the different ports of call, and which holds them liable in damages to passengers for any deviation from said schedule

Sweet Lines vs CA 121 SCRA 769
F: Private respondents purchased first-class tickets from petitioner in Cebu City. They were to board petitioner's vessel M/V Sweet Grace, bound for Catbalogan, Western Samar. Instead of departing at the scheduled hour of about midnight, the vessel sailed at around 3 A.M. only to be towed back to Cebu due to engine trouble, arriving back at Cebu at about 4 PM. After repairs, the vessel was only able to leave around 8 A.M. of the next day.

Instead of docking at Catbalogan, which was the first port of call, the vessel proceeded directly to Tacloban. Private respondents had no recourse but to disembark and board a ferryboat to Catbalogan. Hence this suit for damages for breach of contract of carriage. The TC and CA decided in favor of plaintiffs.

Issue: WON defendant is liable.

Held: The governing provisions are found in the Code of Commerce. Art. 614 provides that a captain who agreed to make a voyage and who fails to fulfill his undertaking, without being prevented by fortuitous event or force majeure, shall indemnify all the losses which his failure may cause, without prejudice to criminal penalties which may prosper. Art. 698 also provides for the captain's liability.

The crucial factor then is the existence of a fortuitous event or force majeure. Without it, the right to damages and indemnity exists against a captain who fails to fulfill his undertaking or where the interruption has been caused by the captain exclusively.

As found by both courts below, there was no fortuitous event or force majeure which prevented the vessel from fulfilling its undertaking of taking private respondents to Catbalogan. Mechanical defects in the CC are not considered caso fortuito that exempts the CC from responsibility. Even granting that the engine failure was a fortuitous event, it accounted only for the delay in the departure. When the vessel left Cebu, there was no longer any force majeure that justified the by-passing a port of call. The vessel was completely repaired when it left Cebu for Samar and Leyte. In fact, after docking at Tacloban City, the vessel left for Manila to complete its voyage.

Petitioner cannot rely on the conditions in small bold print at the back of the ticket reading: "The passenger's acceptance of this ticket shall be considered as an acceptance of the ff. conditions:

3. In case the vessel cannot continue or complete the trip for any cause whatsoever, the carrier reserves the right to bring the passenger to his/her destination at the expense of the carrier or to cancel the tickets and refund the passenger the value of his/her ticket.

11. The sailing schedule of the vessel xxx is subject to change without previous notice."
Even assuming that those conditions are applicable to case at bar, petitioner did not comply with the same. It did not cancel the ticket nor did it refund the value of the tickets to private respondents. Besides, it was not the vessels' sailing schedule that was involved. The complaint is directed not at the delayed departure the next day but at the by-passing of Catbalogan, their destination. Had petitioner notified them previously and offered to bring them to their destination at its expense or refunded the value of the tickets purchased, perhaps this controversy would not have arisen.

Furthermore, the conditions relied upon by petitioner cannot prevail over Arts. 614 and 698 of the Code of Commerce.

The voyage to Catbalogan was interrupted by the captain upon instruction of management. The interruption was not due to fortuitous event or force majeure nor to disability of the vessel. Having been caused by the captain upon instructions of management, the passengers' right to indemnity is evident. The owner of a vessel and the ship agent shall be civilly liable for the acts of the captain under Art. 586 of the Code of Commerce.
The passengers are also entitled to moral damages on account of the BF on the part of the carrier. They did not give notice of the change of schedule. Knowing fully well that it would take 15 hours to repair the vessel, they informed the passengers that it would take only a few hours. They did not offer to refund the tickets of the passengers nor provide them transportation from Bacolod City to Catbalogan.

4. Responsibilities of Captain

Art. 701. The convenience or the interest of the passengers shall not obligate nor empower the captain to stand in-shore or enter places which may take the vessel out of her course, nor to remain in the ports he must or is under the necessity of touching for a period longer than that required by the needs of naviga­tion.

Art. 702. In the absence of an agreement to the contrary, the subsistence of the passengers during the voyage shall be deemed included in the price of the passage; but should it be for their account, the captain shall be under the obligation, in case of necessity, to supply the food necessary for their sustenance at a reasonable price.

Art. 705. In case of the death of a passenger during the voyage the captain shall be authorized, with respect to the body, to take the steps required by the circumstances, and shall carefully take care of the papers and goods of said passenger which may be on board, complying with the provisions of case No. 10 of Article 612 with regard to members of the crew.

Art. 612. The following duties are inherent in the office of captain:

1. To have on board before starting on a voyage a detailed inventory of the hull, engines, rigging, tackle, stores, and other equipments of the vessel; the navigation certificate; the roll of the persons who make up the crew of the vessel, and the contracts entered into with the crew; the list of passengers; the health certificate; the certificate of the registry proving the ownership of the vessel; and all the obligations which encumber the same up to that date; the charters or authenticated copies thereof; the invoices or manifest of the cargo, and the instrument of the expert visit or inspection, should it have been made at the port of departure.

2. To have a copy of this Code on board.

3. To have three folioed and stamped books, placing at the beginning of each one a note of the number of folios it contains, signed by the marine official, and in his absence by the compet­ent authority.

In the first book, which shall be called "log book," he shall enter every day the condition of the atmosphere, the pre­vailing winds, the course sailed, the rigging carried, the horse­power of the engines, the distance covered, the maneuvers execut­ed, and other incidents of navigation. He shall also enter the damage suffered by the vessel in her hull engines, rigging, and tackle, no matter what is its cause, as well as the imperfections and averages of the cargo, and the effects and consequence of the jettison, should there be any; and in cases of grave resolutions which require the advice or a meeting of the officers of the vessel, or even of the passengers and crew, he shall record the decision adopted. For the informations indicated he shall make use of the binnacle book, and of the steam or engine book kept by the engineer.

In the second book, called the "accounting book", he shall enter all the amounts collected and paid for the account of the vessel, entering specifically article by article, the sources of the collection, and the amounts invested in provisions, repairs, acquisition of rigging or goods, fuel, outfits, wages, and all other expenses. He shall furthermore enter therein a list of all the members of the crew, stating their domiciles, their wages and salaries, and the amounts they may have received on accounts, either directly or by delivery to their families.

In the third book, called "freight book," he shall record the entry and exit of all the goods, stating their marks and packages, names of the shippers and of the consignees, ports of loading and unloading, and the freight earned. In the same book he shall record the names and places of sailing of the passengers and the number of packages of which their baggage consists, and the price of the passage.

4. To make, before receiving the freight, with the officers of the crew, and the two experts, if required by the shippers and passengers, an examination of the vessel, in order to ascertain whether she is watertight, and whether the rigging and engines are in good condition; and if she has the equipment required for good navigation, preserving a certificate of the memorandum of this inspection, signed by all the persons who may have taken part therein, under their liability.

The experts shall be appointed one by the captain of the vessel and the other one by the persons who request the examina­tion, and in case of disagreement a third shall be appointed by the marine authority of the port.

5. To remain constantly on board the vessel with the crew during the time the freight is taken on board and carefully watch the stowage thereof; not to consent to any merchandise or goods of a dangerous character to be taken on, such as inflammable or explosive substances, without the precautions which are recom­mended for their packing, management and isolation; not to permit that any freight be carried on deck which by reason of its dispo­sition, volume, or weight makes the work of the sailors diffi­cult, and which might endanger the safety of the vessel; and if, on account of the nature of the merchandise, the special charac­ter of the shipment, and principally the favorable season it takes place, he allows merchandise to be carried on deck, he must hear the opinion of the officers of the vessel, and have the consent of the shippers and of the agent.

6. To demand a pilot at the expense of the vessel whenever required by navigation, and principally when a port, canal, or river, or a roadstead or anchoring place is to be entered with which neither he, the officers nor the crew are acquainted.

7. To be on deck at the time of sighting land and to take command on entering and leaving ports, canals, roadsteads, and rivers, unless there is a pilot on board discharging his duties. He shall not spend the night away from the vessel except for serious causes or by reason of official business. 8. To present himself, when making a port in distress, to the maritime authority if in the Philippines and to the Filipino consul if in a foreign country, before twenty-four hours have elapsed, and make a statement of the name, registry, and port of departure of the vessel, of its cargo, and reason of arrival, which declaration shall be vised by the authority of by the consul if after examining the same it is found to be acceptable, giving the captain the proper certificate in order to show his arrival under stress and the reasons therefor. In the absence of marine officials or of the consul, the declaration must be made before the local authority.

9. To take the steps necessary before the competent authority in order to enter in the certificate of the vessel in the registry of the vessels, the obligations which he may con­tract in accordance with Article 583.

10. To put in a safe place and keep all the papers and belongings of any members of the crew who might die on the ves­sel, drawing up a detailed inventory, in the presence of passengers as witnesses, and, in their absence, of members of the crew.

11. To conduct himself according to the rules and precepts contained in the instructions of the agent, being liable for all that he may do in violation thereof.

12. To give an account to the agent from the port where the vessel arrives, of the reason therefor, taking advantage of the semaphore, telegraph, mail, etc., according to the cases; notify him the freight he may have received, stating the name and domi­cile of the shippers, freight earned, and amounts borrowed on bottomry bond, advise him of his departure, and give him any information and date which may be of interest.

13. To observe the rules on the situation of lights and evolutions to prevent collisions.

14. To remain on board in case of danger to the vessel, until all hope to save her is lost, and before abandoning her to hear the officers of the crew, abiding by the decision of the majority; and if he should have to take a boat he shall take with him, before anything else, the books and papers, and then the articles of most value, being obliged to prove in case of the loss of the books and papers that he did all he could to save them.

15. In case of wreck he shall make the proper protest in due form at the first port reached, before the competent authority or Filipino consul, within twenty-four hours, stating therein all the incidents of the wreck, in accordance with case 8 of this article.

16. To comply with the obligations imposed by the laws and rules of navigation, customs, health, and others.

Art. 703. A passenger shall be considered a shipper of the goods he carries on board, and the captain shall not be responsible for what the former may keep under his immediate and special custody, unless the damage arises from an act of the captain or of the crew.

Art. 1754. The provisions of Arts. 1733 to 1753 shall apply to the passenger's baggage which is not in his personal custody or in that of his employee. As to the other baggage, the rules in Articles 1998 and 2000 to 2003 concerning the responsibility of hotel-keepers shall be applicable. (New Civil Code.)

J. Carriage of Goods by Sea Act (Commonwealth Act. No. 65, Public Act No. 521, 74the US Congress)

Sec. 1. That the provisions of Public Act No. 521 of the 74th Congress of the United States, approved on April 16, 1936, be accepted, as it is hereby accepted to be made applicable to all contracts for the carriage of goods by sea to and from Phil­ippine ports in foreign trade: Provided, that nothing in this Act shall be construed as repealing any existing provision of the Code of Commerce which is not in force, or as limiting its appli­cation.
Notes: In relation to Civil Code :

Art. 1753 - governed by law of place of destination, if shipped to a foreign country, governed by law of foreign country

Art. 1766 - goods from foreign country shipped to the Philip­pines, governed by the Civil Code
COGSA - applicable to all transportation of goods by sea in foreign trade to and from Philippine ports

- does not apply to purely domestic transport

- Laws applicable to a contract for the carriage of goods by sea:
1. Distinguish - common carrier (Civil Code)

- private carrier

2. Where is the vessel going?

a. Common carrier coming to the Phils. = what law applies?

1st: Civil Code

2nd: COGSA (it's more specific than Code of Commerce)

- in foreign trade

3rd: Code of Commerce

b. Private carrier coming to the Phils. in foreign trade

1st: COGSA (because it's more specific)

2nd: Code of Commerce

3rd: Civil Code (provisions not on common carriers e.g. torts, contracts)

c. From the Phils. to a foreign country: apply laws of such foreign country (Art. 1753)
- with respect to vessels destined for foreign ports, the COGSA doesn't apply unless parties make it applicable.
Q: In what situations does COGSA primarily apply?

A: Where the parties expressly stipulate that COGSA shall govern their respective rights and obligations.

Q: Can the COGSA apply in domestic shipping?

A: Generally, NO.

EXCEPTION: when parties agree to make it apply.
Q: What application does COGSA have in carriage of passengers?

A: None. Applies only to carriage of goods.