(continuation of Course Outline for Transportation Law)

MARITIME COMMERCE

I. CHARACTERISTICS OF MARITIME TRANSACTIONS

A. Real

 Luzon Stevedoring Corp. vs. CA (156 SCRA 169 [1987])

B. Hypothecary

 Dela Torre vs. CA (653 SCRA 714 [2011])

 Monarch Insurance vs. CA (333 SCRA 71 [2000])
 Aboitiz Shipping Corp. vs. CA (569 SCRA 294 [2008])
 Aboitiz Shipping vs. General Accident Fire & Life Assurance (217
SCRA 359 [1993])
 Luzon Stevedoring Corp. vs. CA (156 SCRA 169 [1987])

C. Arrastre Operations Not Maritime

 ICTSI vs. Prudential Guarantee (320 SCRA 244 [1999])

D. Contracts Involving Supply Vessels are Maritime in Nature

 Crescent Petroleum vs. M/V Lok Maheshwari (474 SCRA 623 [2005])

II. EXCEPTION TO HYPOTHECARY NATURE OF MARITIME TRANSACTIONS

A. When Shipowner at Fault

 Aboitiz Shipping Corp. vs. New India Assurance Co. (531 SCRA 134
[2007])
 Aboitiz Shipping vs. New India Assurance Company (488 SCRA 563
[2006])
 Central Shipping Co. vs. Insurance Co. of N.A. (437 SCRA 511 [2004])
 Negros Navigation vs. CA (281 SCRA 534 [1997])
 Philamgen vs. CA (273 SCRA 262 [1997])
 Manila Steamship vs. Abdulhaman (100 Phil. 32 [1956])

B. Would Not Apply to Repairs of Vessels

 Government vs. Insular Maritime Co. (45 Phil. 805 [1924])

C. Would Not Apply to Vessel Being Made a Collateral

 Allied Banking Corp. vs. Cheng Yong (472 SCRA 101 [2005])

D. Would Not Apply to Extent Covered By Insurance

 Pedro Vasquez vs. CA (138 SCRA 553 [1985])

E. Does Not Overturn Liability Rule under Labor Code

 Abueg vs. San Diego (77 Phil. 32 [1948])

F. Summation on Exceptions

 Cruz vs. Sun Holidays, Inc. (622 SCRA 389 [2010])

 Loadstar Shipping vs. CA (315 SCRA 339 [1999])
 Caltex (Phils.) vs. Sulpicio Lines, Inc. (315 SCRA 709 [1999])
  San Miguel Corp. vs. Heirs of Inguito (384 SCRA 87 [2002])

G. Ship Mortgage Act of 1978

 PNB vs. CA (337 SCRA 381 [2000])

1. Maritime Lien under Ship Mortgage Decree of 1978

 Crescent Petroleum vs. M/V Lok Maheswari (474 SCRA 623

[2005])
 Poliand Industrial Ltd. vs. NDC (467 SCRA 500 [2005])

2. In the Event of Corporate Rehabilitation

 Negros Navigation Co. vs. CA (573 SCRA 434 [2008])

III. CHARTER PARTY

A. Definition

 Dela Torre vs. CA (653SCRA 714 [2011])

 Ouano vs. CA (211 SCRA 740 [1992])
 National Union Fire vs. Stolt-Nielsen Phils. (184 SCRA 682 [1990])

1. Obligations of Charterer

 San Miguel Corp. vs. Heirs of Inguito (384 SCRA 87 [2002])

B. Concepts

1. Primage
2. Demurrage
3. Laydays
4. Deadfreight

 NFA vs. CA (311 SCRA 700 [1999])

 Keng Hua Paper Products vs. CA (286 SCRA 257 [1998])
 National Steel Corp. vs. CA (283 SCRA 45 [1997])

C. Contract of Affreightment

 Planters Products vs. CA (226 SCRA 476 [1993])

1. Obligation of Charterer

D. Bareboat or Demise Charter

 Lea Mer Industries vs. Malayan Insurance (471 SCRA 698 [2005])

1. Distinguishing Demise/Bareboat Charter from Contract of Affreightment

 Coastwise Lighterage vs. CA (245 SCRA 796 [1995])

 Litonjua Shipping vs. National Seamen Board (176 SCRA 189
[1989])

E. Other Provisions Relating to Charter Party

1. Arts. 670-676; 679-687, Code of Commerce

2. Arts. 688-690, Code of Commerce (Rescission of Charter Party)

a) Rescission by Charterer (Art. 688)

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 b) Total Rescission by Owner (Art. 689)
c) Total Rescission due to Fortuitous Event (Art. 690)

IV. OTHER PROVISIONS OF THE CODE OF COMMERCE

A. Arts. 573-579

B. Arts. 580-584 – Preference of Credit

C. Arts. 585-586

 Macondray & Co. Inc. vs. Provident Insurance Corp. (445 SCRA 644
[2004])
 NDC vs. CA (164 SCRA 593 [1988])

D. Arts. 587-610

 Phils. First Insurance Co. vs. Wallem Phils. Shipping (582 SCRA 457
[2009])
 Inter-Orient Maritime Enterprises vs. NLRC (235 SCRA 2678 [1994])

E. Art. 612 – Duties of Captain

 Sadagnot vs. Reinier Pacific Intl Shipping, Inc. (529 SCRA 413 [2007])

F. Art. 614-641; 643-648; 653-667

 Overseas Factors vs. Southseas Factors (4 SCRA 400 [1962])

 NARIC vs. Macadaeg (102 Phil. 1161 [unrep])

G. Arts. 668-669; 691-705

 Trans-Asia Shipping Lines vs. CA (254 SCRA 260 [1996])

H. Arts. 706-718 (superseded by Arts. 1507-1520, New Civil Code)

1. In InterIsland Trade

2. In Overseas Trade

 Elser & Co. vs. CA (96 Phil. 264 [1955])

 Singa Ship Management Phils. vs. NLRC (276 SCRA 201
[1997])

V. BOTTOMRY AND RESPONDENTIA LOANS

A. Elements of Contracts (Art. 719)

B. Who May Contract

C. Other Relevant Provisions

1. Arts. 725-805, Code of Commerce

VI. AVERAGES

A. Articles 806-812

B. Rules

 American Home Assurance vs. CA (208 SCRA 343 [1992])

 Magsaysay, Inc. vs. Agan (96 Phil. 504 [1955])

C. Procedure in General Average

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 D. Other Relevant Provisions

1. Arts. 813-814

 Phil. Home Assurance vs. CA (257 SCRA 468 [1996])

2. Arts.815-825
3. Art. 864 – Liquidation of Averages

VII. COLLISION (ART. 826)

A. Rule

B. Five Cases Covered by Collision and Allision

1. One Vessel at Fault

2. Both Vessels at Fault
3. Vessel at Fault Not Known
4. Third Vessel at Fault
5. Fortuitous Event

 Urrutia vs. Baco River Plantation (26 Phil. 623 [1914])

 Williams vs. Yangco (27 Phil. 68 [1914])

a) Duty of Overtaking or Crossing Vessel

 Sulpicio Lines vs. CA (305 SCRA 478 [1999])

b) When Moving Vessel Strikes Stationary Object

 Far Eastern Shipping vs. CA (297 SCRA 30 [1998])

C. Other Relevant Provisions

1. Arts. 827-845

VIII. SALVAGE LAW [ACT 2616]

A. Philosophy

B. Four Requisites for Salvage Reward to be Warranted

C. Derelict

 Barrios vs. Go Thong (7 SCRA 535 [1963])

IX. DOMESTIC SHIPPING DEVELOPMENT ACT OF 2004

A. Recognizing the Critical Role of the Domestic Shipping Industry

1. Declared Policies of the Act

2. Definition of Key Terms

“Domestic Shipping”
“Domestic Trade”
“Domestic Ship Operator” or “Domestic Ship Owner”
“Shipper”

B. Incentives Given

1. Net Operating Loss Carry-Over

2. Accelerated Depreciation on Equipment

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 3. VAT Exemption

a) For Domestic Ship Operators

b) For Shipbuilding and Ship Repair

C. Deregulation of Domestic Shipping Industry

1. Authority to Operate
2. Foreign Vessels Engaged in Trade and Commerce in Phil.
Territorial Waters
3. Issuance of Authority to Operate
4. Deregulation of Domestic Shipping Industry

D. Compulsory Insurance Coverage

E. Prohibited Acts and Practices

F. Shipbuilding

1. Incentives

2. Restrictions on Vessel Importation

G. MARINA

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