Sink or Swim in the Philippines

The tragedy of the sinking of the Princess of the Stars ferry in the Philippines is proof that the country is prone not only to natural calamities, but to manmade ones as well. The refusal of Philippine courts to award sufficiently high damages to victims and their families has made loss of life affordable to those who intend to violate their contractual obligations.

MANILA – The tragedy of the sinking of the Princess of the Stars ferry in the waters off Romblon in the Philippines – with hundreds of corpses still believed trapped inside – is proof that the country is prone not only to natural calamities, but to manmade ones as well. The decision to allow the vessel to sail directly into the path of Typhoon Frank resulted from plain and simple incompetence.

Worse still, the same shipping line has been involved in at least three other tragedies at sea in the past 11 years, including the “Dona Paz” disaster in 1987, which killed more than 4,000 people and was described as the world’s worst maritime disaster in peace time. That record adds even more ignominy to the sense of loss suffered by the loved ones of those who died or remain missing. If only Philippine authorities could learn the lessons of past tragedies, this latest one might well have been averted.

Philippine law, like that of most jurisdictions worldwide, classifies the business of transportation as a public convenience. It is undertaken not as an ordinary business under traditional conditions of laissez-faire, but as one vested with the public interest.

Of prime concern is the fact that sea travel has been and will always be perilous. For a thousand years, states have regulated maritime transportation for the purpose of promoting safety at sea. In theory, the Philippine authorities should have exercised their regulatory oversight with far more diligence. Instead, Manila port officials and the Philippine coast guard permitted the Princess of the Stars to set sail, despite clear warnings by the weather bureau that the ship was headed for the eye of the typhoon. So the problem is not one of regulation, but of the will to enforce it.

Moreover, it is more than strange that a company with so dismal a safety record has continued to operate. Surely, the fact that the Philippines is notorious for being one of the world’s most corrupt countries explains why non-seaworthy vessels with incompetent crews continue to ply their routes. Quite simply, it is a root failure of the rule of law in the Philippines that is to blame for the plight of the victims.

Part of the problem lies in the fact that Philippine law places a very low value on human life. Indeed, in Philippine courts, the cost of indemnity for a human life is valued at only $2,500. In the country’s statute books, the value is even lower – just $100.

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This valuation may not constitute the full amount of damages that the heirs of those who have died as a result of a crime or a breach of contract may eventually recover. Nevertheless, the refusal of Philippine courts to award damages beyond actual damages and nominal moral damages has made loss of life affordable to those who intend to be derelict in their contractual obligations.

Of course, exemplary and punitive damages in order to discourage conduct inimical to society do exist in the statute books. But Philippine courts have refused to resort to the use of such damage awards as a tool for controlling behavior, particularly of businessmen. Recent attempts by Filipino lawyers to prosecute civil claims for environmental tort and human rights abuses before American courts demonstrate just how desperate Filipino claimants are to seek redress against those who have acted negligently or with impunity.

All of this explains why Sulpicio Lines, the owner of the Princess of the Stars, has remained in commercial operations despite its many lapses. Simply put, the Philippine courts have not made it sufficiently costly for it to maintain non-seaworthy vessels.

Worse, litigation in the Philippines takes at least five years on average to be concluded. Even those Filipinos who can afford to litigate have to wait; a claimant in the Dona Paz tragedy, for example, waited 19 years before recovering $250,000 in damages. As a general rule, though, Filipino ferry and ship passengers are poor and cannot afford the services of lawyers or the high filing fees demanded by the courts. As a consequence, they settle for the crumbs that are eventually offered by the ship owners after a disaster.

This lawless legality is all too common in a country where 85% of people live in abject poverty. To many of them, sea travel remains the only viable means of transportation. Non-seaworthy vessels notwithstanding, their only alternative would be to swim – or, like those on board the Princess of the Stars, to sink.