DOCTRINE OF LIMITED LIABILITY – liability of ship owner

is confined to that which he is entitled to abandon – “the

vessel with all her equipments and the freight he may
have earned during the voyage” – and if they are lost, it
suffices for his discharge. [No ship = no liability]

LIMITED LIABILITY RULE – the exclusively real and

hypothecary nature of maritime law operates to limit the
liability of the ship-owner to the value of –
a. the vessel Difference between Certificate of Public Convenience
b. earned freightage and Certificate of Public Convenience and Necessity.
c. proceeds of insurance, if any.

When applicable. Code of Commerce sanctions the

application of the doctrine in the following cases:
1. Civil liability for indemnities in favor of third
persons which arise from the conduct of the
captain in the case of the goods
2. Civil liability arising from collisions
3. Unpaid wages of the captain and the crew if the
vessel and its cargo are totally lost by reason of
capture and shipwreck

What are the exceptions?

1. Injury to or death of a passenger is due either to Requisites/Elements of General Average.
the fault of the shipowner or to the concurring
negligence of shipowner and the captain
2. Vessel is insured
3. Workmen’s compensation claim
4. When presumption of negligence was not
overcome

MARINE PROTEST – a written statement under oath,

made by the master of a vessel, after the occurrence of
an accident or disaster in which the vessel or cargo is lost
or injured, with respect to the circumstances attending
such occurrence. It is usually intended to show that the
loss or damage resulted from a peril of the sea, or from
some other cause for which neither master nor owner
was responsible, and concludes with the protestation
against any liability of the owner for such loss or damage.

Instances where Marine Protest must be filed.

1. Arrival under stress;
2. Shipwreck;
3. Collision;
4. In case the vessel has gone through a hurricane
or when the captain believes that the cargo has
suffered damages.

Difference between Free on Board and Free Alongside.

Bill of Rights of Air Passengers.
Ask your baby
MAYER STEEL PIPE v CA
Carriage of Goods by Sea Act governs the relationship
between the carrier on the one hand and the shipper, the
consignee and/or the insurer on the other hand. It
defines the obligations of the carrier under the contract
of carriage. It does not, however, affect the relationship
between the shipper and the insurer. This case is
governed by the Insurance Code. The insurer exercising
its right of subrogation is bound by the one-year
prescriptive period. However, it does not apply to claim
against the insurer for the insurance proceeds because
the claim against the insurer is based on contract, it
expires in 10 days.
Is Nocum case applicable in case of death of air
passengers due to explosive device brought in the plane
by a passenger?
Contending that the captain/master of the vessel is only
a representative of the shipowner, the heirs of X, who
died in a shipwreck of a vessel owned by A, filed a
criminal complaint against A for reckless imprudence
resulting to multiple homicide. Will the criminal
complaint prosper?
Vessel X and Y collided. X is the proximate cause and
had the last clear chance to avoid the collision while Y
had contributory negligence. To which vessel is the
collision imputable?
Mrs. AA was on board Celytrade bus which was hit by a
truck that lost control of its brakes. Mrs. AA died as a
result of said accident. Which is liable – Celytrade bus
or the truck owner?
Santos III v Northwest Orient Airlines – will the
complaint prosper? Does the Philippine Court have
jurisdiction?
The Warsaw Convention is a treaty commitment
voluntarily assumed by the Philippine government and,
as such, has the force and effect of law in this country.
By its own terms, it applies to all international
transportation of persons performed by aircraft for hire.
Since the flight involved in this case is international, it is
subject to the provisions of the Warsaw Convention. The
place of destination, within the meaning of the Warsaw
Convention, is determined by the terms of the contract
or carriage or, specifically in this case, the ticket.
Examination of petitioner’s ticket shows that his ultimate
destination is San Francisco. Although the date of the
return flight was left open, the contract of carriage
between the parties indicates that NOA was bound to
transport petitioner from Manila to San Francisco.
Manila should therefore be considered merely an agreed
stopping place and not the destination. Hence, Philippine
courts have no jurisdiction over the case.
UNITED AIRLINES v UY
Supreme Court held that although the 2-year prescriptive
period under the Warsaw Convention has lapsed, it did
not preclude the application of other pertinent
provisions of the Civil Code which prescribe a different
period or procedure for instituting the action,
specifically, Art. 1146 thereof which prescribes four (4)
years for filing an action based on torts. Thus, the action
for damages could still be filed.
Supreme Court found that there was an
exception to the applicability of the 2-year prescriptive
period – that is when the airline employed delaying
tactics and gave the passenger the run-around. Verily,
respondent filed his complaint more than two (2) years
later, but it is obvious that respondent was forestalled
from immediately filing an action by but not giving in to
his demands. Also, the Convention does not preclude the
operation of the Civil Code and other pertinent laws. It
does not regulate, much less exempt, the carrier from
liability for damages for violating the rights of its
passengers under the contract of carriage, especially if
willful misconduct on the part of the carrier's employees
is found or established.
A. MAGSAYSAY INC. v ANASTACIO AGAN – is the cargo
owner’s contention that he has no liability to contribute
to general average correct?