It has been reported by media that Sulpicio Lines has exercised its right to limit its liability by exercising its right to abandon its sunken vessel so as to entitle it to claim for total loss on its Hull insurance.
However, this right to abandon based on that medieval doctrine which is incorporated in our Code of Commerce of "no vessel, no liability" is not an absolute right.
Our Supreme Court has not recognized such a right where the ship owner is at fault or was negligent, resulting in the total loss of his ship. In one case, the owner himself allowed the ship to sail in an unseaworthy condition and therefore was not entitled to limit his liability under this medieval doctrine of "no-vessel, no-liability" or to the insurance money. Likewise, in another where the ship owner himself caused the vessel to sail without licensed officers, the right to limit liability was also denied.
Moreover, it appears that the Code of Commerce provisions that incorporates this right to limitation covers only liability for collision (Art. 837) injuries to passenger cargo and third parties (Art. 587) and acts of the captain (Art.590). They do not cover the fault or negligence of the ship owner; else, there could easily be an instrument of maritime fraud. In such cases, without the shield of limited liability predicated on abandonment of the sunken ship, the ship owner is liable for all the consequence of his acts of faults or negligence, including salvage of the ship. - EDUARDO & ADRIANO HERNANDEZ, Makati City

 

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