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ACCIDENTS AND DAMAGES IN MARITIME

COMMERCE
WHAT ARE THE ACCIDENTS IN MARITIME COMMERCE?
A. Averages
B. Arrival Under Stress
C. Collision (Allision)
D. Shipwreck
AVERAGES
Arts. 806-818 of the Code of Commerce
Sec 1- Proof and Liquidation of Averages
Sec 2- Liquidation of Gross Averages
Sec 3- Liquidation of Ordinary Averages
AVERAGES
Is a loss or damage accidentally happening to a vessel or to
its cargo during a voyage. Also, a small duty paid to masters of
ships, when goods are sent in another mans ship, for their care of
the goods, over and above the freight. (Black law Dictionary, 6 th
ed.).
AVERAGES MAY CONSIST OF:
1. Expenses to the carrier
Requisites:
a. Such must be extraordinary or accidental;
b. Incurred during the voyage; and
c. such must be incurred to preserve the vessel or
cargo, or both.
(Art 806, par1)

2. Damages or Deterioration
Requisites:
a. Such must have been suffered from the time the
vessel puts
to sea from the port of departure until it
casts anchor in the port of
destination; and
b. Such must have been suffered by the goods
from the time they
are loaded in the port of shipment until
they are unloaded in the port
of consignment. (Art 806,
par2)
CLASSIFICATION OF AVERAGES
1. SIMPLE OR PARTICULAR AVERAGES
-Include all damages or expenses caused to the vessel
or cargo that did not inure to the common benefit. (Art 809)
-Damages or expenses that are to be borne ONLY by the
owner of the things which gave rise to the same. ( Art 810)
EFFECT: No Reimbursement
2. GENERAL OR GROSS AVERAGES
-Include all damages or expenses deliberately caused in
order to save the vessel, its cargo or both from real and known
risk. (art 811)
-Being for the common benefit, gross/general averages
are to be borne by all person having an interest in the vessel and
cargo at the time of the occurrence of the average. ( Art 812)
EFFECT: The person who incurred the damage/expense
can ask reimbursement from those who benefited, which of
course, may include the ship owner.
Article 809 and 811 enumerate certain cases in
classifying averages into simple or particular and general or
gross.
NOTE:

REQUISITES OF GENERAL AVERAGES


1. There must be a common danger to the ship and cargo
- The vessel and cargo are subject to the same danger;
and
- The danger must be imminent and apparently
inevitable, except by incurring a loss of a portion of the
associated interests to save the remainder.
2. There is a deliberate sacrifice of a part of the vessel or
cargo
- There must be a voluntary sacrifice of a position for
the benefit of the whole.
Example:

A voluntary jettison or casting away of some


portion of the associated interests for the purpose of avoiding the
common peril, or a voluntary transfer of the common peril from
the whole to a particular portion of those interests.
3. There must be a successful saving of vessel or cargo, or
both; and
4. There must be a proper procedure or legal steps
- Such expenses or damages should have been incurred
after taking proper legal steps
and authority.
When the captain should call a meeting with the
members of the crew and if the owner of the goods happens to be
on board, he must be called to attend the meeting. If the captain
decides to make a general average, it must be entered in the log
book.
Example:

FORMALITIES FOR INCURRING A GENERAL AVERAGE


1. There must be an assembly of the sailing mate and other
officers with the captain including those with interests in the
cargo;
2. There must be a resolution of the captain;

3.
The resolution shall be entered in the logbook, with the
reasons and motives and the votes for and against the resolution;
4. The minutes shall be signed by the parties; and
5. Within 24 hours upon arrival at the 1 st port the captain makes,
he shall deliver one copy of the minutes to the maritime judicial
authority thereat. (Arts 813 and 814)
DISTINCTIONS BETWEEN GENERAL AVERAGES AND
PARTICULAR AVERAGES

GENERAL AVERAGE

PARTICULAR AVERAGE

Both the vessel and the No common danger to both


cargo are
the
subject to the same vessel and the cargo
danger.
There
is
a
deliberate
sacrifice of part of the
vessel, cargo, or both.
Damage
or
expenses
incurred to the
vessel, its cargo, or both,
redounded to the benefit of
the respective owners.

Expenses and damages are


not deliberately made
Did not inure to common
benefit and profit of all
persons interested in the
vessel and cargo.

All
those
who
have Only the owner of the goods
benefited shall satisfy the benefiting from the damage
average.
shall bear the expense of
average.

GOODS THAT ARE NOT COVERED BY GENERAL AVERAGE


EVEN IF SACRIFICED
1. Goods that are not recorded in the books or records of the
vessel. ( Art 855(2))
2. Fuel for the vessel if there is more than sufficient fuel for the
voyage. (Rule IX, York-Antwerp Rule)
WHAT S JETTISON?

-It is an act of throwing overboard part of a vessels cargo or


hull in hopes of saving a vessel from sinking.
ORDER OF GOODS TO BE CAST OVERBOARD IN CASE OF
JETTISON
1. Those on deck, preferring the bigger bulk with least value
2. Those below upper deck, beginning with the heaviest with
least utility (use).

DISTINCTIONS BETWEEN OVERSEAS TRADE AND INTERISLAND


TRADE
REGARDING
REIMBURSEMENT
AND
PAYMENT OF GENERAL AVERAGES ON JETTISONED DECK
CARGO:

OVERSEAS TRADE

INTER-ISLAND TRADE

The
York-Antwerp
Rules The York- Antwerp Rules
prohibit the loading of cargo allow deck cargo.
on deck.
In case the cargo is jettisoned,
the owner will not be entitled
to reimbursement in view of
the violation.

If the cargo loaded on deck


is jettisoned as a result of
which the vessel was saved,
the cargo owner is entitled
to reimbursement.

If the cargo were saved, the If the cargo is saved, the


owner must contribute to owner must not contribute
general average.
to the general average.

In inter-island trade, voyages are usually short and


there are intervening islands and the seas are generally not
rough.
NOTE:

In overseas trade, the vessel is exposed for many days to


the peril of the sea making deck cargo dangerous to navigation.
YORK-ANTWERP RULES

Is an international system of rules, providing among others,


for liquidation and payment of averages, and provides that the
rights to contribution in general average shall not be affected,
though the event which gave rise to the sacrifice or expenditure
may have been due to the fault of one of the parties to the
adventure.
This shall, however, not prejudice any remedies which may
be open against that party for such fault.