Académique Documents
Professionnel Documents
Culture Documents
Contract of Affreightment
involves the use of shipping space on vessels leased
by the owner in part or as a whole, to carry goods
for another
CC = observe extraordinary diligence; in case of loss,
deterioration or destruction of goods of goods, CCs
2.
Law applicable
o Common Civil Code
o Private contract
Diligence required
o Common extraordinary diligence
o Private diligence of a good father of a family
c.
- Duration of Duty:
Motor vehicles like jeepneys and buses are duty bound to stop their
conveyances for a reasonable length of time in order to afford
passengers an opportunity to board and enter, and they are liable for
injuries suffered by boarding passengers resulting from the sudden
starting up or jerking of their conveyances while they do so. Once a
public utility bus or jeepney stops, it is making a continuous offer to bus
riders.
3.
4.
Cases:
1.
2.
IMPROPER PACKING
Character of the goods and defects in the packaging or in the containers
are defenses available to the common carrier. Similarly, the Carriage of
Good by Sea Act provides that carrier shall not liable for:
1. Wastage in bulk or weight or any damages arising from the
inherent defect, quality or vice of goods;
2. Insufficiency of packing;
3. Insufficiency or inadequacy of the marks, or
4. Latent defects no discoverable by due diligence.
However, NCC likewise provides:
Art. 1742. Even if the loss, destruction, or deterioration of the goods
should be caused by the character of the goods, or the faulty nature of
the packing or the containers, the common carrier must exercise due
diligence to forestall or lessen the loss.
Thus, if the carrier accepted the goods knowing the fact of improper
packing or even if the carrier does not know but the defect was
nonetheless apparent upon ordinary observation, it is not relived from
liability for loss or injury to goods resulting therefrom.
Cases:
1.
2.
The liability does not cease even upon proof that they exercised
diligence in the selection and supervision of their employees.
Art. 1763. Carrier is responsible for injuries suffered by a passenger on
account of the willful acts or negligence of other passengers or of
strangers, if the common carriers employees through the exercise of
the diligence of a good father of a family could have prevented or
stopped the act or omission.
a.
-
Employees
Carrier is liable for the acts of its employees. It cant escape
liability by claiming that it exercised due diligence in
supervision and selection of its employees (unlike in quasidelicts).
b.
PASSENGERS BAGGAGES
2.
Despite the fact that the carrier gave notice that it shall not be
liable for baggage brought in by passengers, the carrier is still
liable for lost hand-carried luggage since it is governed by rules
on necessary deposits. Under Art. 20000, the responsibility of
the depositary includes the loss of property of the guest
caused by strangers but not that which may proceed from
force majeure. Moreover, article 2001 considers theft as force
majeure if it is done with use of arms or through irresistible
force.
Even if the passenger did not declare his baggage nor pay its
charges contrary to the regulations of the bus company, the
carrier is still liable in case of loss of the baggage. Since, it has
the duty to exercise extraordinary diligence over the baggage
that was turned over to the carrier or placed in the baggage
compartment of the bus. The non-payment of the charges is
immaterial as long as the baggage was received by the carrier
for transportation.
The carrier may be able to prove that the only cause of the loss of
the goods is any of the following:
1. Failure of the shipper to disclose the nature of the goods;
2. Improper marking or direction as to the destination;
3. Improper loading when he assumes such responsibility.
The shipper must likewise see to it that the goods are properly
packed; otherwise, liability of the carrier may either be mitigated
or barred depending on the circumstances.
Art. 1741. If the shipper or owner merely contributed to the loss,
destruction or deterioration of the goods, the proximate cause
thereof being the negligence of the common carrier, the latter
shall be liable in damages, which however, shall be equitably
reduced.
Art. 1761. The passenger must observe the diligence of a good father
of a family to avoid injury to himself.
Art. 1762. The contributory negligence of the passenger does not bar
recovery of damages for his death or injuries, if the proximate cause
thereof is the negligence of the common carrier, but the amount of
damages shall be equitably reduced.
a.
Assumption of Risk
Passengers must take such risks incident to the mode of travel. Carriers
are not insurers of the lives of their passengers. Thus, in air travel,
adverse weather conditions or extreme climatic changes are some of the
perils involved in air travel, the consequence of which the passenger
must assume or expect.
FREIGHT
a.
Amount to be Paid
The regulation of rates is founded upon the valid exercise of the Police
Power of the state in order to protect the public from arbitrary and
excessive rates while maintaining the efficiency and quality of services
rendered. The fixing of just and reasonable rates involves a balancing of
investor and the consumer interest.
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Although either of the shipper or the consignor may pay the freight
before or at time the goods are delivered to the carrier for shipment,
nonetheless, it is the consignor (whom the contract of carriage is made)
who is primarily liable for the payment of freight whether or not he is
the owner of the goods. The obligation to pay is implied from the mere
fact that the consignor has placed the goods with the carrier for the
purpose of transportation.
c.
Time to pay
CHAPTER 3
EXTRAORDINARY DILIGENCE
I. RATIONALE
A common carrier is bound to carry the passengers safely as
far a human care and foresight provide, using the utmost diligence of
very cautious persons, with due regard for all circumstances.
Extraordinary diligence: Calculated to protect the passengers
from the tragic mishaps that frequently occur in connection with rapid
modern transportation.
II. HOW DUTY IS COMPLIED WITH
There is no hard and fast rule in the exercise of extraordinary
diligence
Common carrier binds itself to carry the passengers safely as
far as human care and foresight can provide, using the utmost
diligence of a very cautious person, with due regard for all the
circumstances.
The duty even extends to the members of the crew or
complement operating the carrier
Case: Kapalaran Bus Lines vs. Coronado
If common carriers carefully observed the statutory standard
of extraordinary diligence in respect of their own passengers,
they cannot help but simultaneously benefit pedestrians and
the owners and passengers of other vehicles who are equally
entitled to the safe and convenient use of our roads and
highways
A reasonable man or a good father of a family in the position of the
carrier must exercise extraordinary diligence in the performance of his
contractual obligation.
Generally, what should be determines is whether or not a
reasonable man, exercising extraordinary diligence, could
have foreseen and prevented the damage or loss that
occurred.
III. EFFECT OF STIPULATION
A. GOODS
The parties cannot stipulate that the carrier will NOT exercise
ANY diligence in the custody of goods
The law allows a stipulation whereby the carrier will exercise
a degree of diligence which is less than extraordinary with
respect to goods.
Art. 1744. A stipulation between the common carrier and the
shipper owner limiting the liability of the former for the loss,
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b.
c.
No duty to inquire
Because of the implied warranty of seaworthiness,
shippers of goods, when transacting with common
carriers, are not expected to inquire into the vessels
seaworthiness, genuineness of its licenses and
compliance with all maritime laws. Passengers cannot be
expected to inquire everytime they board a common
carrier, whether the carrier possesses the necessary
papers or that all the carriers employees are qualified.
It is the carrier that carries such burden of proving that
the ship is seaworthy.
Sufficient evidence must be submitted and the
presentation of certificates of seaworthiness is not
sufficient to overcome the presumption of negligence.
Meaning of Seaworthiness
A vessel must have such degree of fitness which an owner
who is exercising extraordinary diligence would require
his vessel to have at the commencement of the voyage,
having regard to all the probable circumstances of it. This
includes fitness of the vessel itself to withstand the rigors
Example: The carrier was able to establish that the ship itself was
seaworthy because the records reveal that the vessel was dry-docked
and inspected by the Phil. Coast Guard before its first destination.
A warranty of seaworthiness requires that it be properly laden, and
provided with a competent master, a sufficient number of competent
officers and seamen, and the requisite appurtenances and equipment.
The carrier shall be bound before and at the beginning of the voyage to
exercise due diligence to:
1. Make the ship seaworthy;
2. Properly man, equip, and supply the ship;
3. Make all parts of the ship in which goods are carried, fit and
safe for their reception, carriage, and preservation.
The carrier shall properly and carefully load, handle, stow, carry, keep,
care for, and discharge the goods carried.
Note: Seaworthiness is relative it its construction and its application
depends on the facts of a particular case (ex. Length and nature of the
voyage)
Fitness of the Vessel Itself
It is necessary that the vessel can be expected to meet the
normal hazards of the journey
General Test of Seaworthiness: Whether the ship and its
appurtenances are reasonably fit to perform the service
undertaken.
The ship must be cargoworthy
Even if the vessel was properly maintained and is free from
defect, the carrier must not accept the goods that cannot
properly be transported in the ship
The ship must be efficiently strong and equipped to carry the
particular kind of cargo which she has contracted to carry and
her cargo must be so loaded that it is safe for her to proceed
on her voyage.
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B. OVERLOADING
-
C. PROPER STORAGE
-
The vessel itself may be suitable for the cargo but this is not
enough because the cargo must also be properly stored.
Note: With respect to carriers by sea, the routes are subject to approval
by MARINA and the same cannot generally be changed without the
authorization from said administrative agency
2.
Cargo must generally not be placed on deck. The carrying of deck cargo
raises the presumption of unseaworthiness unless it can be shown that
the deck cargo will not interfere with the proper management of the
ship.
D. NEGLIGENCE OF CAPTAIN AND CREW
-
Deviation
Transshipment
- The act of taking cargo out of one ship and loading it into
another; to transfer goods from the vessel stipulated in the
contract of affreightment to another vessel before the place
of destination named in the contract has been reached.
- Transshipment of freight without legal excuse is a violation of
the contract and subjects the carrier to liability if the freight is
lost even by a cause otherwise excepted.
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CHAPTER 4
BILL OF LADING
I. CONCEPTS, DEFINITION AND KINDS
Bill of Lading (BOL)
A written acknowledgement, signed by the master of a vessel
or other authorized agent of the carrier that he has received
the described goods from the shipper, to be transported on
the expressed terms to be described the place of destination,
and to be delivered to the designated consignees of the
parties.
It operates as a (1) RECEIPT (2) as a CONTRACT (3) as a
DOCUMENT OF TITLE.
A BOL is not necessary for the perfection of a contract of carriage.
Thus, the obligation to exercise extraordinary diligence by the carrier is
still required even if there is no bill of lading.
In the absence of the bill of lading, disputes shall be determined on the
basis of the provisions in the New Civil Code and suppletory by the Code
of Commerce.
KINDS of BILL of LADING:
1. Clean Bill of
Lading
2. Foul Bill of
Lading
3. Spent Bill of
Lading
4. Through Bill
of Lading
5. On Board
Bill
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6. Received for
Shipment Bill
7. Custody Bill
of Lading
8. Port Bill of
Lading
I. RECEIPT
As comprehending all methods
of transportation, a
BOL may be defined as a written acknowledgement of the
receipt of goods and an agreement to transport and to deliver
them at a specified place to a person named or on his order.
Other terms, shipping receipts, forwarders receipts, and
receipts for transportation.
(SC) the designation however is not material, and neither is
the form of the instrument.
If it contains an
acknowledgement by the carrier of the receipt of goods for
transportation it is, in legal effect a BOL.
The issuance of a bill of lading carries the presumption that
the goods were delivered to the carrier issuing the bill, for
immediate shipment, and it is nowhere questioned that a bill
of lading is prima facie evidence of the receipt of the goods by
the carrier
II. CONTRACT
It expresses the terms and conditions of the agreement
between the parties; names the parties; includes consignees
etc. It is the law between the parties bound by its terms and
conditions.
BASIC STIPULATIONS
Provided for in the Code of Commerce
(for overland transportation, maritime commerce and
electronic documents, please refer to the textbook for the
codal pp. 203-210)
PROHIBITED AND LIMITING STIPULATION
Contracts of Adhesion
It is to be construed liberally in favor of the shipper who
adhered to such bill as it is a contract of adhesion. The only
participation of the party is the signing of his signature or his
adhesion thereto.
The shipper or passenger is bound by the terms and conditions
if there is no occasion to speak of ambiguities or obscurities
If the words appear to be contrary to the evident intention of
the parties, the latter shall prevail over the former
1.
2.
Exempting the carrier from any and all liability for loss or
damage occasioned by its own negligence - INVALID as it is
contrary to public policy.
Parties may stipulate that the diligence to be exercised by the
carrier for the carriage of goods be less than extraordinary
diligence if it is:
a. in writing and signed by both parties
b. supported by a valuable consideration other than
the service rendered by the common carrier
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c.
3.
4.
not be less than $500 and in no event shall the carrier be liable
for more than the amount of damage actually sustained
Note that Art. 1749 of the NCC applies to inter-island trade.
Meaning of Package
If the goods are shipped in cartons, each carton is considered
a package even if they are stored in container vans
When what ordinarily be considered packages are shipped in
a container supplied by the carrier and the number of such
units is disclosed in the shipping documents, each of those
units and not the container constitutes the package.
Remember:
1. The parties cannot stipulate so as to totally exempt the carrier
from exercising any degree of diligence whatsoever
2. The parties cannot stipulate that the common carrier shall
exercise diligence less than the diligence of a good father of a
family
Prescriptive periods
Suit for loss or damage to the cargo should be brought within
one year after:
a. delivery of the goods; or
b. The date when the goods should be delivered. (Sec.
3[6])
Things to Remember:
1. Article 1757 provides that the responsibility of a common
carrier to exercise utmost diligence for the safety of
PASSENGERS CANNOT be dispensed with or lessened by
stipulation or statement on tickets or otherwise
2. Article 1750 of the Civil Code provides that a contract fixing
the sum that may be recovered by the owner or shipper for
the loss, destruction, or deterioration of the GOODS is VALID,
if it is REASONABLE and JUST under the circumstances, and
has been FAIRLY AND FREELY AGREED UPON
3. It is unfair to deny the shipper the right to declare the actual
value of his cargos and to recover such true value in case of
loss or damage
Note: it has been suggested that the signature of the shipper
in the bill of lading with regards to the limitation applies only
to reduction of diligence and not to the stipulated amount to
be paid.
4. It is unjust and contrary to public policy if the common
carriers liability for acts committed by thieves, or of robbers
who do not act with grave or irresistible threat, violence or
force, is dispensed with or diminished
5. The common carrier may EXEMPT itself from liability if he can
prove that:
a. He observed extraordinary diligence
b. The proximate and only cause of the incident is a
fortuitous event or force majeure
c. The proximate and only cause of the loss is the
character of the goods or defects in the packing or
in the containers
d. The proximate and only cause of the loss is the order
or act of competent public authority
Note: to limit its liability or at least mitigate the same, the
carrier can cite CONTRIBUTORY NEGLIGENCE of the plaintiff
and the DOCTIRNE OF AVOIDABLE CONSEQUENCES
Case: Sea-Land Service Inc. vs. IAC
Liability of a common carrier for loss of or damage to goods
transported by it under a contract of carriage is governed by
the laws of the country of destination
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3.
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A. Negotiability
- It is negotiable if it is deliverable to the bearer, or to the order of any
person named in such document. (Art. 1507, Civil Code)
a) Effect of Stamp or Notation Non-Negotiable
C. Effects of Negotiation
- has the effect of manual delivery so as to constitute the transferee
the owner of the goods
- results in the transfer of ownership because transfer of document
likewise transfers control over the goods
- refer to Art. 1513
Chapter 5
Actions and Damages in Case of Breach
Cause of action of a passenger and shipper:
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b) Extinctive Prescription
six (6) years if there is no written contract (bill of lading)
ten (10) years if there is written contract
A claim must be filed with the carrier within the following period:
1. if the damage is apparent, the claim should be filed
immediately upon discharge of the goods; or
2. Within 3 days from delivery, if damage is not apparent.
The period does not begin to run until the consignee has
received possession of the merchandise that he may exercise
over it the ordinary control pertinent to ownership.
This provision applies even to transportation by sea within the
Phils. or coastwise shipping.
Does NOT apply to misdelivery of goods.
a) Prescription
Action for damages must be filed within a period of one (1) year
from discharge of the goods.
The period is not suspended by an extra-judicial demand. (Why.
Transportation of goods by sea should be decided in as short a
time as possible)
o Case: Dole Philippines Inc. vs. Maritime Company of
the Philippines - the prescriptive period is not tolled
or interrupted by a written extra-judicial demand.
Article 1155 is NOT applicable.
The period does not apply to conversion or misdelivery.
The one (1) year period refers to loss of goods and not to
misdelivery.
However, it does not apply to the claim against the insurer for
the insurance proceeds. The claim against the insurer is based on
contract that expires in ten (10) years.
II. Recoverable Damages
Carrier in good faith is liable only to pay for the damages that
are the natural and probable consequences of the breach of
the obligation and which the parties have foreseen or could
have reasonably foreseen at the time the obligation was
constituted.
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1.
2.
-
2) Attorneys fees
Refer to Art. 2208 of the Civil Code
3) Interests
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c) Nominal Damages
- Refer to Art. 2221-2223 (Civil Code)
- It is adjudicated in order that the right of plaintiff may be vindicated
or recognized, and not for the purpose of indemnifying the plaintiff
for any loss suffered by him.
- The assessment of nominal damages is left to the discretion of the
court according to the circumstances of the case.
- The award of nominal damages is also justified in the absence of
competent proof of the specific amounts of actual damages
suffered.
- Cannot co-exist with actual damages.
- There is no loss in nominal damages, unlike in actual and temperate
damages, loss is present which is proven and not proven but rather
ascertained by the court, respectively.
Case: Japan Airlines vs. CA
The award of moral damages was justified because JAL failed
to make necessary arrangement to transport the plaintiffs on
the first available connecting flight to Manila.
Only Nominal damages were awarded in the absence of proof
of actual damages
d) Temperate or Moderate Damages
- More than nominal but less than compensatory damages.
- Art. 2224 provides:
May be recovered when the court finds that some pecuniary loss
has been suffered but its amount cannot, from the nature of the
case, be provided with certainty.
- cannot co-exist with actual damages
- Definite proof of pecuniary loss cannot be offered, although the
court is convinced that there has been such loss.
e) Liquidated Damages
Those agreed by the parties to a contract, to be paid in case of
breach thereof.
Ordinarily, the court cannot change the amount of liquidated
damages agreed upon by the parties. However, Art. 2227 of
the Civil Code provides that liquidated damages, whether
intended as an indemnity or a penalty, shall be equitably
reduced if they were iniquitous or unconscionable.
f) Exemplary or Corrective Damages
Requisites for the award of exemplary damages:
1. They may be imposed by way of example in addition to
compensatory damages, and only after the claimants right to
them has been established.
2. They cannot be recovered as a matter of right, their
determination depending upon the amount of compensatory
damages that may be awarded to the claimant.
3. The act must be accompanied by bad faith or done in wanton,
fraudulent, oppressive or malevolent manner.
Note: If gross negligence warrants the award of exemplary damages,
with more reason is its imposition justified when the act performed is
deliberate, malicious and tainted with bad faith. The rationale behind
exemplary or corrective damage is to provide an example or correction
from public good.
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MARITIME LAW
A. CONCEPTS (Chapter 6)
STATUTORY PROVISIONS
Maritime Law is the system of laws which particularly relates to the
affairs and business of the sea, to ships, their crews and navigation and
to marine conveyance of persons and property
Governing Laws:
1. New Civil Code primary law on maritime commerce
2. Book III Code of Commerce applied suppletorily
3. Special Laws
a. Salvage Law (Act No. 2616)
b. Carriage of Goods by Sea Act (CA No. 65)
c. Ship Mortgage Decree of 1978 (PD 1521)
REAL AND HYPOTHECARY NATURE OF MARITIME LAW
Case: Philippine Shipping Company, et al. vs. Francisco Garcia Vergara
That which distinguishes the maritime from the civil law and
even from the mercantile law in general is the real and
hypothecary nature of the former
This repeals the civil law to such extent that, in certain cases
where the mortgaged property is lost no personal action lies
against the owner or agent of the vessel
Case: Aboitiz Shipping Corporation vs. General Accident Fire and Life
Assurance Corporation, Ltd.
Article 837, 587, 590 and 643 provides for limited liability of shipowner. (Read full provision)
Art. 837: civil liability incurred by the ship owner: liability limited to
value of the vessel + appurtenances + freightage earned during voyage
Art. 643: vessel and cargo lost by reason of capture or wreck: all rights
shall be extinguished, both as regards the crew to demand any wages
whatsoever, and as regards the ship agent to recover the advances
made
If a portion of the vessel or of the cargo, or both, should be
saved, the crew engaged on wages, including the captain, shall retain
their rights on the salvage, so far as they go, on the remainder of the
vessel as well on the amount of the freightage of the cargo saved; but
sailors who are engaged on shares shall not have any right whatsoever
on the salvage of the hull, but only the portion of the freightage saved.
If they should have worded to recover the remainder of the shipwrecked
vessel they shall be given from the amount of the salvage an award in
proportion of the efforts made and to the risks encountered in order to
accomplish the salvage
Art. 587: ship agent may exempt himself of the civil liabilities for the
indemnities in favor of third persons by abandoning vessel with all
equipment and freight it earned during voyage
Art. 590: co-owners civilly liable in proportion to their interest and may
exempt liability by abandonment of the part of the vessel belonging to
him
Limited liability rule means that the liability of a ship-owner for
damages in case of loss is limited to the value of his vessel.
No vessel, no liability.
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2.
The total loss of the vessel did not extinguish the liability
of the carriers insured
Despite the loss of the vessel, therefore, its insurance
answers for the damages that a ship-owner or agent,
may be held liable for by reason of the death of its
passengers.
3.
In the workmens
COMPENSATION)
compensation
claims
(WORKERS
4.
5.
PROTESTS
is the written statement by the master of a vessel or any
authorized officer, attested by proper officer or a notary, to
the effect that damages has been suffered by the ship
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monarch, this was not applied--- all the negligence was related to the
absence of exercising extraordinary diligence)
CASES:
Loadstar case
- The ship-owner is aware of the typhoon
- Insufficient manning negligent
- Captain playing mahjong there was negligence. But SC said that it was
negligent because the ship-owner did not prove that it was the first.
Supposedly facts are established in court proceedings and not on
presumption.
3. No vessel, no liability
- They all mean one and the same such that the liability of the shipowner for the losses is confined to the value of the vessel and the
freight, if any.
MARITIME PROTEST (4 INSTANCES) REQUIRED (LOOK AT CODE OF
COMMERCE and above notes)
INSTANCES WHEN IT DOES NOT APPLY:
1. NOT based CODE OF COMMERCE AND BASED ON QUASI-DELICT THEN
NOT MARITIME PROTEST
2. When what was is involve is not a vessel (Lopez vs. Duruel: the motor
boat is not a vessel under maritime law, it is only engaged in bay traffic.
A vessel in maritime law, should be engaged in transporting goods,
persons, or both from one port to another)
(But to be sure: you file maritime and allege such bahala dili kailangan
coz otherwise dismiss ang case)
Since a vessel is a personal property, it can be mortgaged
Same concept with mortgage but different rule
PD 1521:
Q: what about process of extra judicial foreclosure of vessel.
A: chattel mortgage law should govern
Q: what to remember under PD 1521.
A: Section 4
Registration, non-waiver
Section17: priority of claims
Q: are there claims in maritime law over and above preferred mortgage.
A: yes. Look at section 17.
Case: Poliand Industrial
- Facts shows that the proceeds debted from hardwood was for the
modification of the vessel (extended for vessels benefit), for crews wage
Characteristics of maritime lien:
1. Maritime property
2. travels with the property--- it cannot be extinguished
3. Enforceable in an action in rem--- action directed to the property
(crescent case: ang gi kiha ang vessel)
Under section 22: persons authorize to procure repairs (presumed):
1. Managing agent
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When the mercantile code speaks of vessels, they refer solely and
exclusively to mercantile ships, as they do not include warships,
and furthermore, they almost always refer to craft which are not
accessory to another as in the case of launches, lifeboats and etc.
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2. OWNERSHIP
ACQUISITION
bill of sale shall be executed before the consul of the Republic of the
Philippines at the port where it terminates its voyage and said
instrument shall produce no effect with respect to third persons if it is
not inscribed in the registry of the consulate. The consul shall
immediately forward a true copy of the instrument of purchase and sale
of the vessel to the registry of vessels of the port where said vessel is
inscribed and registered.
In every case the alienation of the vessel must be made to appear with
a statement of whether the vendor receives its price in whole or in part,
or whether he preserves in whole or in part any claim on said vessel. In
case the sale is made to a Filipino, this fact shall be stated in the
certificate of navigation.
When a vessel, being on a voyage, shall be rendered useless for
navigation, the captain shall apply to the competent judge on court of
the port of arrival, should it be in the Philippines; and should it be in a
foreign country, to the consul of the Republic of the Philippines, should
there be one, or, where there is none, to the judge or court or to the
local authority; and the consul, or the judge or court, shall order an
examination of the vessel to be made.
If the consignee or the insurer should reside at said port, or should have
representatives there, they must be cited in order that they may take
part in the proceedings on behalf of whoever may be concerned.
REGISTRATION
Sec 906 of the Tariff and Custom Code provides that manifest
shall be required for cargo and passengers transported from one
place to another only when one or both of such place is a port of
entry.
MORTGAGE
Since the term personal property includes vessel, they are subject
to mortgage agreeably to the provisions of the Chattel Mortgage
Law.
SAFETY REGULATIONS
26
Master and Pilot (See Far Eastern Shipping case on page 520 of the
Aquino book for the SC discussion on the duties of a pilot)
b.
27
officers and crew who are working in foreign vessels who are
involved in overseas shipping, there must be compliance with the
applicable laws on overseas employment as well as regulations
issued by the Philippine Overseas Employment Administration
(POEA).
CODE OF COMMERCE PROVISIONS on Sailing Mates, Second Mate and
Marine Engineer, Crew, and Captain (See pages 552-560 of the Aquino
book).
Parties --- those provided above plus seamen, other members of the
complement including the stokers (in charge of boilers) and supercargo
(agent of the shippers who has authority to sell goods while on voyage)
4 maritime contracts
1. Charter parties
2. Botomry
3. Repondentia
4. Marine insurance (incorporated in the subject insurance)
ON PERSONS
Ship-owner
he has the privilege to invoke limited liability rule
What if with a charter party with charterer, who can invoke
the LLR. No jurisprudence. Personal opinion of sir: distinguish
on the type of charter party. If affreightment, ship-owner
retains possession, command and navigation of the vessel. If
bareboat it is vested upon the charterer.
Jurisprudence: except for registration, the charterer is the
temporary owner of the vessel. With this, the charterer can
invoke LLR (this part no juris)
There is a situation in maritime law that ship-owner and agent they are
held liable for the act or omission of a third person which is the ship
captain or master.
ACTS of CAPTAIN
Case: Yucon case and Sweetlines case
In Yucon, money was entrusted to the captain and the money
was lost. SC concluded that ship-owner was liable for the lost
because the captain failed to put up measures while in
custody of the money. It may not technically to an act but may
refer to admission but would fall under the term acts
In sweetlines, bound for catbalogan but the captain chose to
allow the passengers to disembark in tacloban. This time, this
is the act of captain. The SC concluded that the damages
sustained by passengers bound for catbalogan are to
shouldered by the ship-owner
Indemnities in Favor of 3rd person: OTTA dev. case sited in Walter smith
case
In OTTA the owner of the pier was at the same time the owner
of the goods. SC, because there was a relationship of owner of
vessel and goods, then there is presumption of negligence
new civil code prevails
Walter smith case: There was no relationship. Owner of port
and owner of goods are different. What was applied by court
was the law on torts. No presumption of negligence. There
should be proof of negligence. The owner of vessel proved
that he exercised ordinary diligence (required in ports). What
was presented was the competence of ship captain. The ship-
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29
FRIEGHT OR FREIGHTAGE
price of carriage
shall accrue according to what is stipulated in the contract
should there be no stipulation or if it is ambiguous , rules shall
be
a. freight shall begin to run from the day of loading on the
vessel
b.
in charters with fixed period, the freight shall begin to
run upon that very day
c. If freight is charged according to weight , payment shall
be made according to gross weight , including the weight
of the containers
LAST DAYS- period of time stipulated from loading and unloading
(provided for in charter party); if no lay days provided for in the charter
party, it is understood that the charterer will unload and discharge
cargoes within a reasonable time or with reasonable diligence
Demurrage a sum of money due by express contract for detention of
the vessel in loading, beyond time allowed for that purpose in that
charter party; sum of which is usually fixed by the parties in the charter
party; liability for this exists only when expressly stipulated
Dead freight where the charterer failed to occupy the leased portion
of the vessel, he may thereby be liable by the ship-owner for the dead
freight that occurred
STIPULATION IN CHARTER PARTIES
GR: parties are free to stipulate subject to art 1744 t01754 0f NCC
Art. 1744. A stipulation between the common carrier and the shipper
or owner limiting the liability of the former for the loss, destruction, or
deterioration of the goods to a degree less than extraordinary
diligence shall be valid, provided it be:
(1) In writing, signed by the shipper or owner;
(2) Supported by a valuable consideration other than the
service rendered by the common carrier; and
(3) Reasonable, just and not contrary to public policy.
Art. 1745. Any of the following or similar stipulations shall be
considered unreasonable, unjust and contrary to public policy:
(1) That the goods are transported at the risk of the owner
or shipper;
(2) That the common carrier will not be liable for any loss,
destruction, or deterioration of the goods;
(3) That the common carrier need not observe any diligence
in the custody of the goods;
(4) That the common carrier shall exercise a degree of
diligence less than that of a good father of a family, or of a
man of ordinary prudence in the vigilance over the movables
transported;
(5) That the common carrier shall not be responsible for the
acts or omission of his or its employees;
(6) That the common carrier's liability for acts committed by
thieves, or of robbers who do not act with grave or
irresistible threat, violence or force, is dispensed with or
diminished;
(7) That the common carrier is not responsible for the loss,
destruction, or deterioration of goods on account of the
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ART. 653. If the cargo should be received without the charter party
having been signed, the contract shall be understood as executed In
accordance with what appears in the bill of lading, the sole evidence of
title with regard to the cargo for determining the rights and obligations
of the ship agent, captain and charterer
- If there is charter party or bill of lading (BOL) = no contract at all; but
according to Blanco, if there is delivery and receipt of cargo combined
with the GF and mutual consent = contract present, better than BOL
E. LOANS ON BOTTOMRY AND RESPONDENTIA
LOAN ON BOTTOMRY loan made by ship-owner or ship agent
guaranteed by vessel itself and repayable upon arrival of vessel at
destination; vessel/portion
LOAN ON RESPONDENTIA loan, taken on security of the cargo laden
on a vessel, and repayable upon safe arrival of cargo at destination;
cargo/goods
1.
2.
DISTINCTIONS:
BOTTOMRY/ RESPONDENTIA
ORDINARY LOAN
2. Not subject
contingency
to
any
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6. Must be in writing
The bottom or the hull or the kill of the vessel can be pledged
in this case
The whole vessel can be a subject of a security or collateral
PD. 1521: (is this different) --- loan is the principal, mortgage
is the accessory.
The contract of Bottomry is principal, the mortgage under PD
1521 is merely a security
In pd 1521 under section 4 it is a requirement that the whole
of the vessel must be mortgaged (no jurisprudence on this
matter whether a part of the vessel can be mortgaged)
In Bottomry the whole or the part of the vessel can be the
subject
IF the part of the vessel can be pledged, is it necessary that
there should be goods. No. no need for goods.
RESPONDENTIA
The vessel should have goods. The goods must be laden in the
vessel
Is it necessary that the boat is on voyage. The vessel must be
in the actual course of voyage because this is the objective of
the law. Because if the vessel is docked in the port the owner
can simply obtain loans. And besides there is no risk when the
vessel is docked (but no jurisprudence)
Distinction of this two types of loan vs. SIMPLE LOAN (for purposes of
the bar) --- 5 differences
1. With respect to form --- can you validly execute a Bottomry or
respondentia verbally. You cannot. Because under the code of
commerce no judicial action can arise when the contract is not reduced
in writing. But this is not the case in simple loan. But in simple loan you
take note the statute of frauds if not in writing B and R, you can dismiss
case due to failure to state cause of action.
Q: why hardly used at present.
A: because of sophistication. Captains can just call up any agent the shipowner to deliver anything for the use of the vessel to deliver. This
contract was recognized in medieval times.
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RULES ON AVERAGES:
1. Averages is defined as damage deliberately caused or an expense
deliberately incurred due to a marine peril and which has resulted
in saving both vessel and cargo or only the vessel or cargo.
2. Where both vessel and cargo are saved, it is general average;
where only the vessel or only the cargo is saved, it is particular
average.
3. The person whose property has been saved must contribute to
reimburse the damage caused or expense incurred if the situation
constitutes general average.
B. Gross or General Average
Damage or expenses deliberately caused in order to save the vessel,
its cargo or both from real and known risk. (Art. 811)
All the persons having an interest in the vessel and the cargo therein
at the time of the occurrence of the average shall contribute to satisfy
this average. (Art. 812)
REQUISITES:
1.
2.
3.
4.
5.
6.
Common danger
- means both the ship and the cargo, after has been loaded, are subject
to the same danger, whether during the voyage, or in the port of loading
or unloading, that the danger arises from the accidents of the sea,
disposition of authority, or faults of men, provided that circumstances
producing the peril should be ascertained and imminent or may
rationally be said to be certain and imminent
- When the measure of precaution adopted solely and exclusively for the
preservation of the vessel from the danger of seizure or capture and not
for the common safety is not considered as common danger
Deliberate Sacrifice
- Voluntary sacrifice of a part for the benefit of the whole in order to
justify the average contribution
* Voluntary jettison- the casting away of some portion of the
associated interests for the purpose of avoiding the common peril
from the whole to a particular portion of those interests
- the goods on board refer to in jettison should be proven by means of
bill of lading and with regards to those belonging to vessel by means of
inventory prepared before the departure
2 cases where there can also be general averages even if the sacrifice
was not made during the voyage:
A. where the sinking of the vessel is necessary to extinguish a
fire in a port, roadstead, creek or bay
B. where cargo is transferred to lighten the ship on account of
a storm to facilitate entry into a port
Art. 816: in order that the goods jettisoned may be included in the gross
average and the owners entitled to indemnity it is necessary that the
cargos existence on board be proven by a bill of lading; and with regard
By Whom Borne
- shall be borne by those who benefited from the sacrifice; the shipowner and the owner of the cargoes that were saved
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- they are obliged to pay for the indemnification of the gross average
provided that the liability shall be limited to the proportion of
contribution attaching to his policy value where this is less than the
contributing value of the thing insured
B. lenders of Bottomry and respondentia (Code of Commerce)
-obliged to pay in proportion to their respective interest, the general
average which may take place in the goods which the loan is made
Who is entitled to indemnity.
Owner of the goods which were sacrificed is entitled to receive the
general contribution
Except;
1. goods carried on desk unless the rule special law or
customs of the place allow the same
2. goods that are not recorded in the books or records
of the vessel
3. fuel of the vessel if there is more than sufficient fuel
for the voyage
American Home Insurance v. CA
Art 848 states that claims shall not be admitted if they do not exceed
5% of the interest which the claimant may have in the vessels or cargo
if it is general average, and 1% of the goods damaged if particular
average deducting in both cases the expenses of appraisal, unless
there is an agreement to the contrary.
It is clear that the damage of the cargo is particular average since the
loss is less than 1% to the value of the cargo and there appears to be no
allegations as to any agreement defendants and consignee of the goods
to the contrary, by express provision of law, plaintiff is barred from
suing for recovery.
Law on averages does not apply if the CC is negligent.
YORK-ANTWERP RULES ON
CONTRIBUTION ON AVERAGES
DETERMINING
LIABILITY
FOR
AVERAGES
- The same concept that was existing in medieval times can be applied
at present
Relevance of averages (take note these ex. Connected to expenses
under 806)
under 806 --- averages are:
o Extraordinary expenses ex. If machine does not
work, you have to ask help of a tugboat the
expenses on the use of tugboat is a question of
averages. This is extraordinary because it is not
foreseen. --- assuming the engine of the vessel was
defective, can that be considered an average. YES.
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2.
3.
4.
5.
Prerequisite to recovery:
Protest should be made within 24 hours before the competent
authority at the point of collision or at the first port of arrival, if in the
Philippines and to the Philippine consul, if the collision took place
abroad. (Art. 835)
Injuries to persons and damage to cargo of owners not on board on
collision time need not be protested. (Art. 836)
DOCTRINE OF LAST CLEAR CHANCE OR CONTRIBUTORY NEGLIGENCE
NOT APPLICABLE.
DOCTRINE OF INSCRUTABLE FAULT
In case of collision where it cannot be determined which between the
two vessels was at fault, both vessels bear their respective damage, but
both should be solidarily liable for damage to the cargo of both vessels.
G. COLLISIONS
Collisions - impact of 2 vessels both of which are moving.
Allision - impact between a moving vessel and a stationary one.
3 Zones of Time in the Collision of vessels:
1. First zone all time up to the moment when risk of collision begins;
2. Second zone time between moment when risk of collision begins
and moment it becomes a practical certainty;
3. Third zone time when collision is certain and time of impact.
Error in Extremis - sudden movement made by a faultless vessel
during the 3rd zone of collision with another vessel which is at fault
during the 2nd zone. Even if such sudden movement is wrong, no
responsibility will fall on said faultless vessel. (Urrutia and Co. v. Baco
River Plantation Co., 26 PHIL 632).
Rules on Collision of Vessels under Code of Commerce:
1. The collision may be due to the fault, negligence or lack of skill of
the captain, sailing mate, or any other member of the complement
of the vessel. The owner of the vessel at fault be liable for losses or
damage. (Art. 826)
2. The collision may be due to the fault of both vessels. Each vessel
shall suffer its own losses, but as regards the owner of cargoes both
vessels shall be jointly and severally liable. (Art. 827)
3. If it cannot be determined which vessel is at fault. Each vessel shall
also suffer its own losses and both shall be solidarily liable for losses
on damages on the cargoes. (Art. 828)
4. The vessels may collide with each other through fortuitous event
or force majeure. In this case each shall bear its own damage. (Art.
830)
5. Two vessels may collide with each other without their fault by
reason of a third vessel. The third vessel will be liable for losses and
damages. (Art. 831)
6. A vessel which is properly anchored and moored may collide with
those nearby reasons of storm or other cause of force majeure. The
vessel run into shall suffer its own damage and expense. (Art. 832)
35
Custody of cargo:
entrusted to the captain (except in cases of force majeure)
(Art. 823)
if entire cargo or part thereof should appear to be damaged,
or there should be imminent danger of its being damaged
Captain may request judge of competent court / consul, the
sale of all or part of the cargo
Person taking cognizance shall authorize it (after
examination and declaration)
Captain shall justify the legality of his conduct, answering
to the shipper for the price of the merchandise would have
brought if they had arrived in good condition
(Art. 824)
Liability of captain:
captain responsible for the damages caused by his delay
if cause of arrival under stress ceases he should not
continue the voyage
if cause of arrival should have been the fear of enemies
deliberation and resolution (in a meeting of officers of the
vessel and persons interested in the cargo) shall precede the
departure
(Art. 825)
* Shipwreck the demolition or shattering of a vessel caused by her
driving ashore or on rocks and shoals in the mid-sea, or by the violence
of winds or waves in tempests
- Loss of the vessel at sea as a consequence of its grounding, or running
against an object in sea or on the coast
Loss or deteriorations of vessel or cargo caused by shipwreck or
stranding individually account of the owners; part which may be
saved belonging to them, same proportion. (Art. 840)
If the wreck was due to malice, negligence or lack of skill of the
captain, the owner of the vessel may demand indemnity from said
captain. (Art. 841)
The goods saved from the wreck to be specially bound for the
payment of the expenses of the respective salvage. (Art. 842)
If several vessels sail under convoy, and any of them should be
wrecked, the cargo saved will be distributed among the rest in
proportion to the amount which each one is able to take. If any
captain should refuse, without sufficient cause, to receive what may
correspond to him, the captain of the wrecked vessel to enter a marine
protest against him. If it is not possible to transfer to the other vessels
the entire cargo of the vessel wrecked, the goods of the highest value
and smallest volume to be saved first. Designation to be made by the
captain with concurrence of his officers. (Art. 843)
The captain taking on-board the goods saved from the wreck to
continue his course to the port of destination and upon arrival he should
deposit the goods for disposal to their owners. In case the captain
changes his course, and if he can unload them at the port of which they
were consigned, he may make said port if the shippers or supercargoes
present and the officers and passengers of the vessel consent thereto.
But he is not required to do so even if he has the consent during time of
war or when the port is difficult and dangerous to make. The owners
of the cargo to defray all the expenses of this arrival and the payment of
the freightage. (Art. 844)
If cannot be, proceed to judicial sale complying with the formalities
and on publicity. (Art. 845)
I. SALVAGE LAW (Act No. 2616)
* SALVAGE services one person renders to the owner of a ship or
goods, by his own labor, preserving the goods or the ship which the
owner or those entrusted with the care of them have either abandoned
in distress at sea, or are unable to protect or secure.
Kinds of Salvage:
Voluntary compensation is dependent on the success.
Under contract for a per diem or per horam wage payable at
all events.
Under contract for compensation payable only in case of
success.
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4.
Flotsam goods that floated off the ship while ship was in
danger or when it sank
SALVAGE LAW
SECTION 1. WHEN IN CASE OF SHIPWRECK, THE VESSEL OR ITS CARGO
SHALL BE BEYOND THE CONTROL OF THE CREW, OR SHALL HAVE BEEN
ABANDONED BY THEM, AND PICKED UP AND CONVEYED TO A SAFE
PLACE BY OTHER PERSONS, THE LATTER SHALL BE ENTITLED TO A
REWARD FOR THE SALVAGE.
THOSE WHO, NOT BEING INCLUDED IN THE ABOVE PARAGRAPH, ASSIST
IN SAVING A VESSEL OR ITS CARGO FROM SHIPWRECK, SHALL BE
ENTITLED TO A LIKE REWARD.
SEC. 2. IF THE CAPTAIN OF THE VESSEL, OR THE PERSON ACTING IN HIS
STEAD, IS PRESENT, NO ONE SHALL TAKE FROM THE SEA, OR FROM THE
SHORES OR COAST MERCHANDISE OR EFFECTS PROCEEDING FROM A
SHIPWRECK OR PROCEED TO THE SALVAGE OF THE VESSEL, WITHOUT
THE CONSENT OF SUCH CAPTAIN OR PERSON ACTING IN HIS STEAD.
SEC. 3. HE WHO SHALL SAVE OR PICK UP A VESSEL OR MERCHANDISE AT
SEA, IN THE ABSENCE OF THE CAPTAIN OF THE VESSEL, OWNER, OR A
REPRESENTATIVE OF EITHER OF THEM, THEY BEING UNKNOWN, SHALL
CONVEY AND DELIVER SUCH VESSEL OR MERCHANDISE, AS SOON AS
POSSIBLE, TO THE COLLECTOR OF CUSTOMS, IF THE PORT HAS A
COLLECTOR, AND OTHERWISE TO THE PROVINCIAL TREASURER OR
MUNICIPAL MAYOR.
SEC. 4. AFTER THE SALVAGE IS ACCOMPLISHED, THE OWNER OR HIS
REPRESENTATIVE SHALL HAVE A RIGHT TO THE DELIVERY OF THE VESSEL
OR THINGS SAVED, PROVIDED THAT HE PAYS, OR GIVES A BOND TO
SECURE, THE EXPENSES AND THE PROPER REWARD.
THE AMOUNT AND SUFFICIENCY OF THE BOND, IN THE ABSENCE OF
AGREEMENT, SHALL BE DETERMINED BY THE COLLECTOR OF CUSTOMS
OR BY THE JUDGE OF THE COURT OF FIRST INSTANCE OF THE PROVINCE
IN WHICH THE THINGS SAVED MAY BE FOUND.
SEC. 5. THE COLLECTOR OF CUSTOMS, PROVINCIAL TREASURER, OR
MUNICIPAL MAYOR, TO WHOM A SALVAGE IS REPORTED, SHALL
ORDER:
A. THAT THE THINGS SAVED BE SAFEGUARD AND INVENTORIED.
B. THE SALE AT PUBLIC OPTION OF THE THINGS SAVED WHICH MAY
BE IN DANGER OF IMMEDIATE LOSS OR OF THOSE WHOSE
CONSERVATION IS EVIDENTLY PREJUDICIAL TO THE INTERESTS OF
THE OWNER, WHEN NO OBJECTION IS MADE TO SUCH SALE.
C. THE ADVERTISEMENT WITHIN THE THIRTY DAYS SUBSEQUENT TO
THE SALVAGE, IN ONE OF THE LOCAL NEWSPAPERS OR IN THE
NEAREST NEWS-PAPER PUBLISHED, OF ALL THE DETAILS OF THE
DISASTER, WITH A STATEMENT OF THE MARK AND NUMBER OF
THE EFFECTS REQUESTING ALL INTERESTED PERSONS TO MAKE
THEIR CLAIMS.
SEC. 6. IF, WHILE THE VESSEL OR THINGS SAVED ARE AT THE
DISPOSITION OF THE AUTHORITIES, THE OWNER OR HIS
REPRESENTATIVE SHALL CLAIM THEM, SUCH AUTHORITIES SHALL
ORDER THEIR DELIVERY TO SUCH OWNER OR HIS REPRESENTATIVE,
PROVIDED THAT THERE IS NO CONTROVERSY OVER THEIR VALUE, AND
A BOND IS GIVEN BY THE OWNER OR HIS REPRESENTATIVE TO SECURE
THE PAYMENT OF THE EXPENSES AND THE PROPER REWARD.
OTHERWISE, THE DELIVERY SHALL NOR BE MADE UNTIL THE MATTER IS
DECIDED BY THE COURT OF FIRST INSTANCE OF THE PROVINCE.
SEC. 7. NO CLAIM BEING PRESENTED IN THE THREE MONTHS
SUBSEQUENT TO THE PUBLICATION OF THE ADVERTISEMENT
PRESCRIBED IN SUB-SECTION (C) OF SECTION FIVE, THE THINGS SAVE
SHALL BE SOLD AT PUBLIC AUCTION, AND THEIR PROCEEDS, AFTER
37
Carrier, and
Shipper
- They are given their respective rights and obligations under COGSA.
- Carrier (covered by COGSA) not limited to the ship-owner; includes
charterer who enters into a contract of carriage with the shipper
- Charterer charters a vessel and conducts his own business for his
own account
After chartering the vessel, he uses the vessel to conduct a
business of transportation obtaining goods from 3rd persons to transport
the latters goods
Duties of the carrier:
Civil Code requires international carriers to exercise
extraordinary diligence in the performance of their
contractual obligations
Section 2 of COGSA carriers obligation and liabilities in
relation to the loading, handling, stowage, carriage, custody,
care and discharge of such goods
Section 3 of COGSA responsibilities of the carrier under
COGSA
Document of title required
- evidenced by the Bill of Lading
- BOL serves as prima facie evidence of the receipt by the carrier of the
goods
Notice of claim and prescriptive period
* Notice of claim must be made within 3 days from delivery if the
damage is not apparent; not mandatory
* Prescriptive period 1 year from delivery for the filing of the case is
a condition precedent or mandatory; does not apply to cases of
misdelivery or conversion
Defenses and immunities
- provided for by Section 4 of COGSA
- Section 49(1) of COGSA carrier shall not be liable for loss or damages
arising from unseaworthiness
- New Civil Code carrier will not be liable only if it can present proof
that the unseaworthiness was caused exclusively by any of the
circumstances specified in Art. 1734 of the NCC
Waiver
38
- The ship-owner and the ship agent may waive the benefit of any of the
defenses in its favor provided not only under COGSA but also under
other laws
Limiting provision
- COGSA contains a provision that allows the shipper to recover only
US$500 per package unless there is a special declaration unless there
the real value of the goods is declared
- declaration made by the shipper stating an amount bigger than $500
per package will make the carrier liable for such bigger amount but only
if the amount so declared is the real value of the goods
Right to discharge dangerous cargo
- COGSA allows the carrier to discharge the good of the carrier discovers
that the goods are dangerous, inflammable or are explosives