PHILIPPINES Law and Practice Contributed by: Valeriano Del Rosario, Daphne Ruby Grasparil, Patrick Sarmiento and Maria Francesca Bautista, VeraLaw
5.3 Liability in Personam for Owners or Demise Charterers By way of background, in an action both in rem and in personam, the Admiralty Rules require that the “relevant person” should either be the owner or the charterer by demise at the time of the filing of the initiatory pleading, called a Complaint with the Admi - ralty Court. The “relevant person” is defined by the Admiralty Rules as “the person who would be liable on the claim in an action in personam”. However, in an action purely in rem, the vessel may be arrested regardless of its owners’ personal liability on the merits. Such would be the case for claims arising from recognised maritime liens such as the unpaid bunkers claim described in 5.4 Unpaid Bunkers (see also Tsuneishi Heavy Industries v MIS Maritime Cor - poration ). 5.4 Unpaid Bunkers Under the Admiralty Rules, Section 5 (j), Rule 1, Part I, the bunker supplier’s claim for unpaid bunkers comes within the jurisdiction of the Admiralty Court. The claim for necessaries gives rise to a maritime lien under Philippine law, and under Section 6 (e), Rule 1, Part I, a claim based on a maritime lien may be enforced by way of an action in rem. Under Section 21 of the Ship Mortgage Decree of 1978, any person furnishing supplies to any vessel upon the order of the owner of such vessel, or of a person authorised by the owner, shall have a maritime lien over the vessel. The bunker supplier will need to allege or prove that credit was given to such vessel. The Philippines does not yet have case law to state whether a charterer is “a person authorised by the owner” to order bunkers. Therefore, each claim will have to be judged based on its individual merits. 5.5 Arresting a Vessel An application for arrest in the Philippines is an ancil - lary remedy – ie, it can only be applied for through a principal in rem action brought against the vessel. In filing the principal in rem action, a verified (sworn) complaint must be filed by the plaintiff, which should be accompanied by: • a statement that it is a case in Admiralty jurisdic - tion;
• the names, addresses and other relevant personal or juridical circumstances of the parties; • all facts material and relevant to the plaintiff’s cause or causes of action; • the law, rule or regulation relied upon, violated or sought to be enforced; • specification of all evidence supporting the cause or causes of action, such as affidavits of witnesses, authenticated documentary evidence which must be attached to the complaint, and object evidence; • the reliefs applied for, which includes an applica - tion for the issuance of a Warrant of Arrest of a Vessel; and • a certification against forum shopping. Since the complaint must be verified and accompa - nied by a certification against forum shopping, the plaintiff’s representative must be duly authorised through a power of attorney, a board resolution, a sec - retary’s certificate or other similar document. These documents must be duly notarised, or when execut - ed outside the Philippines, duly apostilled or consu - larised. The documents accompanying the verified complaint, including its annexes, need not be original or certified true copies at the time of filing, but the original or certified true copies will be required by the Admiralty Court during the pretrial conference. In relation to the Warrant of Arrest, the applicant must execute an affidavit, which shall be attached to the verified complaint, that the applicant undertakes to pay all port charges, fees and expenses for preserva - tion and maintenance of the ship or cargo during its arrest until its release or sale. In addition to this undertaking, the applicant must also give a bond or security executed in favour of the Admiralty Court in the amount of 30% of the claim (but in no case less than PHP5 million). Notice and hearing must be afforded unto the owner, Master, or person in actual possession and control of the property before any Warrant of Arrest may be issued. This notwithstanding, the plaintiff may request an ex parte issuance of a Warrant of Arrest in cases of extreme urgency where it may suffer irreparable or gross inconvenience on account of the mobility of the ship.
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