Transportation Law
1. Does the Limited Liability Rule apply in cases of collision of Maritime Vessels? Explain by giving
examples
2. a. Explain the meaning of Arrival under Stress
b. What are the legal steps to be taken to determine the propriety of Arrival under Stress
3. Who will shoulder the expenses to unload the cargo in the case of arrival under stress in order
to make repair to the ship or to save the cargo from damages, or both and why?
4. a) What is the meaning of shipwreck?
b) Who will bear the damages and deterioration to the vessels and cargoes in the case of
shipwreck and why?
5. a) Can a ship Captain enter into contracts of Loan on Bottomry and Respondentia?
b) What is the order of preference of payment in cases of Loans on Bottomry and Respondentia
and why?
6. a) What are the effects if the Loan on Bottomry or respondentia is larger than the collateral
because of fraud?
b) In the case of Loans on Bottomry and loan on Respondentia, if the vessel/cargo is lost, the
lender shall lose the principal sum loaned. State the five instances wherein the loss of the
vessel/cargo does not extinguish the loan
7. Is the rule on liability of the parties for the damages to the vessels and cargoes in case of
collision due to fortuitous event, the same with the rule on collision wherein the fault is
undeterminable?
Problems:
1. Vessels A and B collided. As a result of said collision, the following damages were sustained:
Vessel A, 10 million pesos and 5 million pesos damages sustained by its cargoes. Vessel B, 15
Million pesos and 10 million pesos to its cargoes. It was proven during the trial that the
proximate cause of the collision was the negligence of the captain of vessel A while the captain
of vessel B was guilty of contributory negligence. State the amount the party/parties would be
liable for the damages sustained by vessels and for the damages sustained by their respective
cargoes.
2. To ensure M/V Jolo is seaworthy, its owner had it repaired on March 16, 2005 and the owner
incurred unpaid bill for repair to Mr. Enrico the amount of 100,000. On May 7 2005, M/V Jolo
collided with M/V Maru due to the fault of the former*. M/V Jolo sank in the water too deep for
salvage operations. M/V Maru was partially damaged in the amount of P1,000,000. After filing
the required protest, the owner of M/V Maru and Mr. Enrico filed suits against the owner of
M/V Jolo for recovery of P1,000,000 and 100,000 respectively. The owner of M/V Jolo pleaded
Limited Liability as a defense. Can there be recovery of the amounts being claimed by M/V Maru
and Mr. Enrico?
3. Peter borrowed 5million from Paul and they both executed a Loan on Respondentia in favor of
Paul covering the trip of MV Panay from Manila to Ilo-ilo. Jason, the shipowner also executed a
Loan on Bottomry for 50million also with Paul as lender without stipulating the extent of the
coverage of the voyage. After MV Panay left Manila, it encountered a storm and cargoes of
Peter jettisoned to save the vessel. The vessel saved and some of the cargoes of Peter were later
salvaged. On its way back to Manila, MV Panay sank beyond recovery. Are the borrowers Peter
and Jason liable to pay their respective loans to Paul?
4. Vessels A and B collided because of strong hurricane. Vessel A suffered damages worth 1Million
and Vessel B worth 2million. The cargoes of Shippers X, Y, Z suffered damages worth 50,000,
60,000, and 70,000 respectively. Who will bear the losses and how much?
Legal Opinion:
1. MV Maru was loaded with sacks of rice and Guimaras mangoes at Iloilo port for transportation
to Zamboanga City. The mangoes were expected to be ripe on February 14, 2014. On February
12, when MV Maru was sailing near Bohol, the ship Captain, Capt. Bernard received an
information that the rebels in Zamboanga will capture the crew and seize the vessel the
moment MV Maru enters the water of Zamboanga between February 12 to 20, 2014. The ship
captain is seeking your legal advice as what action he will atke regarding the voyage, the cargo
and the expenses that may be incurred between February 12 to 20 onwards.
