2 sheds
This is the difference between picking the knats sh!t out of pepper on a forum and practical aviation, it don't matter diddly squat what is in the AP if it is not the document available to the crew of an aircraft.
All the published documentation in the world will not absolve the commander of an aircraft from ensuring the safety of that aircraft and keeping a good lookout is essential to the safety of the aircraft.
I am not in a position to say if rules were breached (or not) in this case but I do know that if one of the pilots had seen the other it is highly likely that the aircraft would not have hit each other.
The bottom line is that good airmanship is the back stop that ensures safety when all the other safety systems have failed.