Transportation laws

PARTICIPANTS IN MARITIME COMMERCE

A. Shipowners and ship agents

B. Captains and masters of the vessel

C. Officers and crew of the vessel

D. Supercargoes

E. Pilot
A. SHIPOWNERS AND SHIP AGENTS

Shipowner (proprietario)

 Person who has possession, control and management of the vessel and the consequent right to direct her navigation and receive freight earned and paid, while his possession continues.

Ship agent (naviero)

 Person entrusted with provisioning and representing the vessel in the port in which it may be found; also includes the shipowner.

 Not a mere agent under civil law; he is solidarily liable with the ship owner.

 Powers and functions:

1. 
   Capacity to trade;
   
2. 
   Discharge duties of the captain, subject to Art.609;
   
3. 
   Contract in the name of the owners with respect to repairs, details of equipment, armament, provisions of food and fuel, and freight of the vessel, and all that relate to the requirements of navigation;
   
4. 
   Order a new voyage, make a new charter or insure the vessel after obtaining authorization from the shipowner or if granted in certificate of appointment.
   

Civil Liabilities of the Shipowner And Ship Agent

1. 
   All contracts of the captain, whether authorized or not, to repair, equip and provision the vessel; (Art. 586)
   
2. 
   Loss and damage to the goods loaded on the vessel without prejudice to their right to free themselves from liability by abandoning the vessel to the creditors. (Art. 587)
   

Duty of Ship Agent to Discharge the Captain and Members of the Crew

 If the seamen contract is not for a definite period or voyage, he may discharge them at his discretion. (Art. 603)

 If for a definite period, he may not discharge them until after the fulfillment of their contracts, except on the following grounds:

1. 
   Insubordination in serious matters;
   
2. 
   Robbery;
   
3. 
   Theft;
   
4. 
   Habitual drunkenness;
   
5. 
   Damage caused to the vessel or to its cargo through malice or manifest or proven negligence. (Art. 605)
   

B. CAPTAINS AND MASTERS

 They are the chiefs or commanders of ships.

 The terms have the same meaning, but are particularly used in accordance with the size of the vessel governed and the scope of transportation, i.e., large and overseas, and small and coastwise, respectively.

 Nature of position (3-fold character):

1. 
   General agent of the shipowner;
   
2. 
   Technical director of the vessel;
   
3. 
   Representative of the government of the country under whose flag he navigates.
   

 Qualifications:

1. 
   Filipino citizen;
   
2. 
   Legal capacity to contract;
   
3. 
   Must have passed the required physical and mental examinations required for licensing him as such. (Art. 609)
   

 Inherent powers:

1. 
   Appoint crew in the absence of ship agent;
   
2. 
   Command the crew and direct the vessel to its port of destination;
   
3. 
   Impose correctional punishment on those who, while on board vessel, fail to comply with his orders or are wanting in discipline;
   
4. 
   Make contracts for the charter of vessel in the absence of ship agent.
   

5. 
   Supply, equip, and provision the vessel; and
   
6. 
   Order repair of vessel to enable it to continue its voyage. (Art. 610)
   

 Sources of funds to comply with the inherent powers of the captain (in successive order):

1. 
   From the consignee of the vessel;
   
2. 
   From the consignee of the cargo;
   
3. 
   By drawing on the ship agent;
   
4. 
   By a loan on bottomry;
   
5. 
   By sale of part of the cargo. (Art. 611)
   

 Duties:

1. 
   Bring on board the proper certificate and documents and a copy of the Code of Commerce;
   
2. 
   Keep a Log Book, Accounting Book and Freight Book;
   
3. 
   Examine the ship before the voyage;
   
4. 
   Stay on board during the loading and unloading of the cargo;
   
5. 
   Be on deck while leaving or entering the port;
   
6. 
   Protest arrivals under stress and in case of shipwreck;
   
7. 
   Follow instructions of and render an accounting to the ship agent;
   
8. 
   Leave the vessel last in case of wreck;
   
9. 
   Hold in custody properties left by deceased passengers and crew members;
   
10. 
    Comply with the requirements of customs, health, etc. at the port of arrival;
    
11. 
    Observe rules to avoid collision;
    
12. 
    Demand a pilot while entering or leaving a port. (Art. 612)
    

 A ship’s captain must be accorded a reasonable measure of discretionary authority to decide what the safety of the ship and of its crew and cargo specifically requires on a stipulated ocean voyage (Inter-Orient Maritime Enterprises Inc. vs. CA).

 No liability for the following:

1. 
   Damages caused to the vessel or to the cargo by force majeure;
   
2. 
   Obligations contracted for the repair, equipment, and provisioning of the vessel unless he has expressly bound himself personally or has signed a bill of exchange or promissory note in his name. (Art. 620)
   

Solidary Liabilities of the Ship Agent/Shipowner for Acts Done by the Captain towards Passengers and Cargoes

1. 
   Damages to vessel and to cargo due to lack of skill and negligence;
   
2. 
   Thefts and robberies of the crew;
   
3. 
   Losses and fines for violation of laws;
   
4. 
   Damages due to mutinies;
   
5. 
   Damages due to misuse of power;
   
6. 
   For deviations;
   
7. 
   For arrivals under stress;
   
8. 
   Damages due to non-observance of marine regulations. (Art. 618)
   

C. OFFICERS AND CREW

1. 
   Sailing Mate/First Mate
   
2. 
   Second Mate
   
3. 
   Engineers
   
4. 
   Crew
   

 No liability under the following circumstances:

1. 
   If, before beginning voyage, captain attempts to change it, or a naval war with the power to which the vessel was destined occurs;
   
2. 
   If a disease breaks out and be officially declared an epidemic in the port of destination;
   
3. 
   If the vessel should change owner or captain. (Art. 647)
   

Sailing Mate/First Mate

 Second chief of the vessel who takes the place of the captain in case of absence, sickness, or death and shall assume all of his duties, powers and responsibilities. (Art. 627)

 Duties:

1. 
   Provide himself with maps and charts with astronomical tables necessary for the discharge of his duties;
   
2. 
   Keep the Binnacle Book;
   
3. 
   Change the course of the voyage on consultation with the captain and the officers of the boat, following the decision of the captain in case of disagreement;
   
4. 
   Responsible for all the damages caused to the vessel and the cargo by reason of his negligence. (Arts. 628 - 631)
   

Second Mate

 Takes command of the vessel in case of the inability or disqualification of the captain and the sailing mate, assuming in such case their powers and responsibilities.

 Third in command

 Duties:

1. 
   Preserve the hull and rigging of the vessel;
   
2. 
   Arrange well the cargo;
   
3. 
   Discipline the crew;
   
4. 
   Assign work to crew members;
   
5. 
   Inventory the rigging and equipment of the vessel, if laid up. (Art. 632)
   

Engineers

 Officers of the vessel but have no authority except in matters referring to the motor apparatus. When two or more are hired, one of them shall be the chief engineer.

 Duties:

1. 
   In charge of the motor apparatus, spare parts, and other instruments pertaining to the engines;
   
2. 
   Keep the engines and boilers in good condition;
   
3. 
   Not to change or repair the engine without authority of the captain;
   
4. 
   Inform the captain of any damage to the motor apparatus;
   
5. 
   Keep an Engine Book;
   
6. 
   Supervise all personnel maintaining the engine. (Art. 632)
   

Crew

 The aggregate of seamen who man a ship, or the ship’s company.

 Hired by the ship agent, where he is present and in his absence, the captain hires them, preferring Filipinos, and in their absence, he may take in foreigners, but not exceeding 1/5 of the crew. (Art. 634)
Classes of Seaman’s Contracts

1. 
   By the voyage;
   
2. 
   By the month; and
   

3. By share of profits or freightage.
Just Causes for the Discharge of Seaman While Contract Subsists

1. 
   Perpetration of a crime;
   
2. 
   Repeated insubordination, want of discipline;
   
3. 
   Repeated incapacity and negligence;
   
4. 
   Habitual drunkenness;
   
5. 
   Physical incapacity;
   
6. 
   Desertion. (Art. 637)
   

Rules in case of Death of a Seaman

 The seaman’s heirs are entitled to payment as follows:

1. 
   If death is natural:
   

1. 
   compensation up to time of death if engaged on wage
   
2. 
   if by voyage - half of amount if death occurs on voyage out; and full, if on voyage in
   
3. 
   if by shares - none, if before departure; full, if after departure
   

2. 
   if death is due to defense of vessel - full payment;
   
3. 
   if captured in defense of vessel - full payment;
   
4. 
   if captured due to carelessness - wages up to the date of the capture. (Art. 645)
   

Complement of the Vessel

 All persons on board, from the captain to the cabin boy, necessary for the management, maneuvers, and service, thus including the crew, the sailing mates, engineers, stokers and other employees on board not having specific designations.

 Does not include the passengers or the persons whom the vessel is transporting.
D. SUPERCARGOES

 Persons who discharges administrative duties assigned to him by ship agent or shippers, keeping an account and record of transaction as required in the accounting book of the captain. (Art. 649)

E. PILOT

 A person duly qualified, and licensed, to conduct a vessel into or out of ports, or in certain waters.

 The term generally connotes a person taken on board at a particular place for the purpose of conducting a ship through a river, road or channel, or from a port.

 Master pro hac vice for the time being in the command and navigation of the ship.

 While in exercising his functions a pilot is in sole command of the ship and supersedes the master for the time being in the command and navigation of the ship, the master does not surrender his vessel to the pilot and the pilot is not the master. There are occasions when the master may and should interfere and even displace the pilot, as when the pilot is obviously incompetent or intoxicated (Far Eastern Shipping Company vs. CA).

 Compulsory Pilotage – States possessing harbors have enacted laws or promulgated rules requiring vessels approaching their ports to take on board pilots licensed under the local laws. (Notes and Cases on the Law on Transportation and Public Utilities, Aquino, T. & Hernando, R.P. 2004 ed. p. 518)

Liablity of Pilot

GENERAL RULE: On compulsory pilotage grounds, the Harbor Pilot is responsible for damage to a vessel or to life or property due to his negligence.

EXCEPT:

1. Accident caused by force majeure or natural calamity provided the pilot exercised prudence and extra diligence to prevent or minimize damages.

2. Countermand or overrule by the master of the vessel in which case the registered owner of the vessel is liable. (Sec.11, Art.III PPA Admin Order 03-85)
SPECIAL CONTRACTS OF MARITIME COMMERCE

1. 
   Charter party
   
2. 
   Bill of lading
   
3. 
   Contract of transportation of passengers on sea voyages
   
4. 
   Loan on bottomry
   
5. 
   Loan on respondentia
   
6. 
   Marine insurance
   

CHARTER PARTY

 A contract by virtue of which the owner or agent binds himself to transport merchandise or persons for a fixed price.

 A contract by which an entire ship, or some principal part thereof is let/leased by the owner to another person for a specified time or use. (Planters Products, Inc. vs. CA, 226 SCRA 476)

 Parties:

1. 
   Ship owner or ship agent
   
2. 
   Charterer
   

 Classes:

1. Bareboat or demise – The charterer provides crew, food and fuel. The charterer is liable as if he were the owner, except when the cause arises from the unworthiness of the vessel. The shipowner leases to the charterer the whole vessel, transferring to the latter the entire command, possession and consequent control over the vessel’s navigation, including the master and the crew, who thereby become the charter’s servants. It transforms a common carrier into a private carrier.

 The charterer becomes the owner of the vessel pro hac vice, just for that one particular purpose only. Because the charterer is treated as owner pro hac vice, the charterer assumes the customary rights and liabilities of the shipowner to third persons and is held liable for the expense of the voyage and the wages of the seamen.

2. Contract of Affreightment – A contract whereby the owner of the vessel leases part or all of its space to haul goods for others.

 The shipowner retains the possession, command and navigation of the ship, the charterer merely having use of the space in the vessel in return for his payment of the charter hired.

 Kinds:

1. 
   Time charter – vessel is chartered for a fixed period of time or duration of voyage.
   
2. 
   Voyage or trip charter – the vessel is leased for one or series of voyages usually for purposes of transporting goods for charterer.
   

LEASE	CHARTER PARTY
If for a definite period, lessee cannot give up the lease by paying a portion of the amount agreed upon.	Charterer may rescind charter party by paying half of the freightage agreed upon.
If the leased property is sold to one who knows of the existence of the lease, the new owner must respect the lease.	The new owner is not compelled to respect the charter party so long as he can load the vessel with his own cargo. (Art. 689)
Civil law concept	Commercial law concept

CHARTER PARTY	BILL OF LADING
An entire or complete contract.	More like a private receipt which the captain gives to accredit goods received from persons
Consensual contract	Real contract
BAREBOAT OR DEMISE CHARTER	CONTRACT OF AFFREIGHTMENT (TIME OR VOYAGE CHARTER)
Charterer becomes liable to others caused by its negligence	Owner remains liable as carrier and must answer for any breach of duty
Charterer regarded as owner pro hac vice for the voyage	Charterer is not regarded as owner.
Owner of vessel relinquishes possession, command and navigation to charterer	The vessel owner retains possession, command and navigation of the ship
Common carrier is converted to private carrier.	Common carrier is not converted to a private carrier.

PERSONS WHO MAY MAKE A CHARTER

1. 
   Owner or owners of the vessel, either in whole or in majority part, who have legal control and possession of the vessel
   
2. 
   Charterer may subcharter entire vessel to 3^rd person only if not prohibited in original charter. (Art.679)
   
3. 
   Ship agent if authorized by the owner/s or given such power in the certificate of appointment. (Art.598)
   
4. 
   Captain in the absence of the ship agent or consignee and only if he acts in accordance with the instructions of the agent or owner and protects the latter’s interests. (Art.609)
   

REQUISITES OF A VALID CHARTER PARTY

1. 
   Consent of the contracting parties
   
2. 
   Existing vessel which should be placed at the disposition of the shipper
   
3. 
   Freight
   
4. 
   Compliance with Art. 652 of the Code of Commerce
   

Clauses Which May Be Included In a Charter Party

Jason clause	Clause paramount or paramount clause
A stipulation in a charter party that in case of a maritime accident for which the shipowner is not responsible by law, contract or otherwise, the cargo shippers, consignees or owners shall contribute with the shipowner in general average. (Pandect of Commercial Law and Jurisprudence, Justice Jose Vitug, 1997 ed.)	A clause in a charter party providing that the COGSA shall apply, even though the transportation is domestic, subject to the extent that any term of the bill of lading is repugnant to the COGSA or applicable law, then to the extent thereof the provision of the bill of lading is void. (Pandect of Commercial Law and Jurisprudence, Justice Jose Vitug, 1997 ed.)

Rights and Obligations of Parties

SHIPOWNER OR SHIP AGENT

CHARTERER

If the vessel is chartered wholly, not to accept cargo from others; To observe represented capacity; To unload cargo clandestinely placed To substitute another vessel if load is less than 3/5 of capacity; To leave the port if the charterer does not bring the cargo within the lay days and extra lay days allowed; To place in a vessel in a condition to navigate; to bring cargo to nearest neutral port in case of war or blockade. (Arts. 669-678)

To pay the agreed charter price; To pay freightage on unboarded cargo; To pay losses to others for loading uncontracted cargo and illicit cargo; To wait if the vessel needs repair; To pay expenses for deviation. (Arts. 679-687)