Essentials on Transportation and Public Utilities Law by Justice Hernando and Aquino

Chapter 16

Averages

Averages

-extraordinary or accidental expenses which may be incurred during the voyage in order to preserve the vessel, the cargo or both

-damages or deterioration which the vessel or its merchandise or both may suffer from its voyage

1. Simple or particular average

- include all the expenses and damages caused to the vessel or her cargo which have not inured to the benefit and profit of all the persons interested in the vessel and cargo

- borne by the owner of the goods that suffered the damage

- res perit domino

2. General average

- include all the damages and expenses which are deliberately caused in order to save the vessel, cargo, or both at the same time from real and known risk

-Requisites:

a. there must be a common danger

b. for the common safety, part of the vessel or cargo or both is sacrificed deliberately

c. from the expenses and damages caused follows a successful saving of the vessel and cargo

d. expenses or damages should have been incurred or inflicted after taking proper steps and authority

Common Danger- both the ship and the cargo, after it has been loaded, are subject to the same danger whether

- during voyage

- in the port of loading or unloading

Common Danger may be:

-dangers of the sea

-dispositions of the authority

-faults of men

*peril should be ascertained, imminent or may rationally be said to be certain and imminent

Deliberate Sacrifice- voluntary sacrifice of a part for the benefit of the whole in order to justify general average contribution

- cannot involve a damage which resulted beyond the control of the captain and crew or without any intention on their part

*loss can no longer be considered a general average if the things was inevitably lost

Successful Sacrifice- the vessel and the cargo sought to be saved thru the sacrificed cargo or part of the vessel should be saved

Compliance with the Legal Steps- expenses or damages should have been incurred after taking proper legal steps ad authority

1. resolution of the captain

2. said resolution should be adopted after deliberation with the sailing mate and other officers of the vessel

Order of Jettison:

1. goods on the deck which embarrass the maneuver or damage of the vessel; heaviest one with the least utility and value

2. goods below the upper deck; greatest weight and smallest value to the amount and number absolutely indispensable

Who Bears General Average

-those who have benefited from the sacrifice

Insurers- obliged to pay for the indemnification of the gross average, insofar as is required of each one of the objects respectively; liable in proportion to the contribution attaching to his policy value

Who is Entitled to Indemnity

-owner of the goods which were sacrificed

Goods not covered:

1. goods carried on deck

2. goods that are not recorded in the books or records of the vessel

3. fuel for the vessel if there is more than sufficient for the voyage

Deck Cargo- sacrifice of deck cargo is not considered general average; not absolute

*Common carriers cannot limit their liability for injury or loss of goods when such was caused by its own negligence

*Law on average cannot be applied in determining liability when there is negligence