The Carrier’s Obligations over Deck Cargo

Abstract

This chapter examines the problems associated with the carriage of goods on deck and the obligations of the carrier over such cargo. In particular, the notions of deck and deck cargo are explained, as well as of the various reasons and considerations behind the carriage of goods on the weather deck of a commercial seagoing vessel. Taking into consideration that new technology and modern shipping practices have remodeled the old doctrine on the carriage of goods on deck, the chapter comprises a factual study and statistical data to measure the risks of deck carriage. These are followed by the legislative and judicial issues related to deck cargo in the context of the Hague-Visby Rules. A comment is made on why such carriage arrangement is considered an exception from the Convention and why declared deck carriage may often step outside the ambit of the Rules and be regulated by the applicable national regime. That is why the current law on deck cargo is stated not only from the English law perspective, but a reference is also made to the national regimes of France, Germany, the Netherlands, Norway, and Sweden. In line with the tenor of the book, the position under the Rotterdam Rules is also examined.

4.1 Introduction

The current chapter will focus on the obligations of the carrier under the Hague/Hague-Visby Rules over cargo that is carried on deck. Particular attention will be paid to the relationship between carriers and cargo interests in matters related to such cargo, and also between shipowners and charterers, as well as on the legislative and judicial issues that arise in the various situations of deck carriage.

The discussion will be begin with a concise description of the notions “deck” and “deck cargo” (Sect. 4.2), followed by the position on deck carriage under the Hague/Hague-Visby Rules (Sect. 4.3), which forms the current regulatory framework. The current law on deck cargo (Sect. 4.4) will be stated while carrying out a risk analysis related to deck carriage, taking into account factual and technical data. In particular, the risk assessment will attempt to “measure” the evolved views on deck carriage; next, the changes in ship design and their impact on the carriage on deck will be analyzed; furthermore, the advent of containerization will be referred to so far as it has affected the traditional deck cargo doctrine; finally, it will be observed how the changes in the views relating to deck cargo have affected the traditional notion of a custom to carry on deck, the required agreement to carry on deck, and the statutory obligations of the carrier to do so. The emphasis in this section will be put on how technology, innovations, and modern shipping practices have changed the views on deck cargo and have widened the gap with the existing statutory rules.

Furthermore, the evolving views on deck cargo will be examined (Sect. 4.5), and, in line with the scope of the current work, the focus will be primarily on English law, which is distinctively restrictive to deck cargo. This detour is to show how courts have interpreted this aspect of the carriage of goods throughout the years in the light of the old doctrine becoming increasingly incompatible with the current shipping practices. The particular issues that will be addressed will be the relation between the various deck cargo provisions and the carrier’s obligations over the cargo under the Rules, as well as problems related to deck cargo provisions coupled with a FIOS(T) clause.

The next section is dedicated to how the carriage of goods on deck is treated in other jurisdictions (Sect. 4.6) and to what extent they have adapted to the evolving law on deck carriage.

Finally, the approach toward the carriage on deck under the Rotterdam Rules is examined (Sect. 4.7), with a commentary on the feasibility of such provisions and on whether they could be applicable against the background of the changed views on deck carriage.

4.2 What Is Deck Cargo?

The carriage of goods on deck is a specific way of transporting goods on a seagoing vessel, and therefore it is treated and regulated differently compared to cargo stowed below deck. In broad terms, deck cargo designates cargo that is carried in any space that is uncovered on the weather deck of a ship instead of being carried inside the ship.¹ If the cargo is stowed in a permanent steel enclosure, even if this location is designated in the plans of the shipbuilder as above the weather deck (e.g., a hatch-trunk, a bridge deck, or a hospital space), the cargo is nevertheless considered to be carried below deck.² A definition of a deck was to be found in the CMI’s early instrument on general average, the York Rules (1864), and in its successor, the York & Antwerp Rules (1877), both of which are now superseded by new revisions of those Rules. The relevant article reads:

Rule I – Jettison of Deck Cargo

[…]

Every structure not built in with the frame of the vessel shall be considered to be a part of the deck of the vessel.

A definition of deck carriage can be derived from the W. Tetley’s description of “under deck” citing Lossiebank (Massce & Co. Inc. v Bank Line): “Under deck means not exposed to the elements; in other words, the cargo is completely protected by the ship’s structure.”³

What makes it so peculiar and distinct to carry cargo that way is that the goods stowed on deck are not protected by the ship’s structure in the same degree as the cargo that is carried below deck. In particular, shipments on deck are directly exposed to adverse elements such as bad weather conditions, be it heavy rains and high winds, snow, due, or haze; seawater splashing aboard; uncontrolled temperature, as well as scorching heat caused by direct sunlight. The risk of damaging such cargo or losing it overboard during carriage is, therefore, substantially greater. So is the risk of the vessel being damaged or rendered unseaworthy because of poorly stowed or lashed cargo, which could start shifting and rolling across the weather deck. Therefore, shipowners that are carrying deck cargo are often advised to avoid, as much as possible, adverse weather conditions and perils of the sea that can be foreseen while still maintaining the interests of charterers and cargo owners.

It may seem thus far that carrying goods on deck is unreasonable because no party has an interest in taking more risks and additionally endangering the cargo carried by exposing it directly to the perils of the sea. Yet cargo has been and is still carried on deck either in break bulk⁴ or in containers⁵ or as a project cargo⁶—in the latter case, the cargo is usually lashed directly to the deck of the ship, carefully balanced for safety of the vessel, and sometimes covered with materials for the protection of the cargo. The reasons why contractual parties may agree on a carriage on deck vary inasmuch as the deck cargo itself—from explosives to lumber and cattle.⁷

Firstly, for some cargos, there are requirements imposed by law to be carried on deck. This is especially the case with the transportation of hazardous cargos, which should be in compliance with the IMDG Code.⁸ The Code distinguishes between five stowage categories, and some of them are restricted to stowage on deck only.⁹ Also, some dangerous goods are not allowed to be discharged and stored in a warehouse at the port of destination, and that is why they have to be discharged and transferred directly from the deck of a docked ship to waiting container trucks or trains so that this cargo can immediately leave the port.¹⁰

For other cargos, deck stowage may be necessitated by technical requirements and convenience. Various out-of-gauge cargos that need more space may not fit in the cargo hold of the ship or may not go through the hatches, and, therefore, they need to be stowed on deck. Such cargo may include aircraft, trucks, locomotives, coaches, windmills, huge critical pieces of equipment, and detached parts of bigger machinery.

There may also be commercial considerations for the carriage of goods on deck, and these are related to the space aboard the vessel and the carrier’s pursuit to maximize profits. Deck carriage, on the other hand, may be preferred by sellers or buyers of the goods, too, simply for efficiency reasons. Cargo stowed on deck is generally more quickly and easier to load and discharge.

4.3 The Position Under the Hague/Hague-Visby Rules: Deck Carriage as an Exception to the Rules

The carriage of goods on deck is yet another exception to the Hague/Hague-Visby Rules. The regulation of deck cargo has deliberately been left out of the scope of the Rules because such cargo has traditionally been seen as potentially hazardous in comparison with cargo carried below deck.¹¹ In America, for example, the exclusion of deck cargo from the application of US COGSA 1936 was explained with the need to relieve the Baltic timber trade from regulation by giving them more freedom of contract.¹²

The exclusion from the scope of the Rules is defined in a rather technical way. Cargo that is stated in the contract of carriage as carried on deck and that is indeed so carried is excluded from the scope of the Hague/Hague-Visby Rules. Although excluded from the Rules, however, deck cargo may well be regulated under national law.¹³ Unless the on-deck carriage is excluded from the ambit of the Rules, there is a breach of the carrier’s implied obligation to carry the goods below deck. This is the conclusion inferred by reading together Article I(c) and Article III rule 8. While the former provision excludes deck cargo from the definition of goods to which the Rules apply, the latter forbids parties to contract out from the Rules or to lessen their liabilities as laid down therein:

Article I

In these Rules the following words are employed, with the meanings set out below:

[…]

(c) ‘Goods’ includes goods, wares, merchandise, and articles of every kind whatsoever except live animals and cargo which by the contract of carriage is stated as being carried on deck and is so carried [emphasis added].

The definition is clearly drafted to encompass within the ambit of the Rules any possible kind of property that can be carried by sea with two exceptions: live animals and deck cargo. Because of the specific risks that these two categories pose during transportation, they are distinguished from the other types of cargo and are taken out of the liability regime established by the Hague/Hague-Visby Rules. Instead, freedom of contract will apply to the carriage of these categories, subject to the mandatory provisions of the applicable law. Therefore, cargo that is stated to be carried on deck and is so carried is exempted from the provisions of the Hague-Visby Rules (unless the parties expressly chose to contractually incorporate the Rules), and carriers can protect themselves from exposure to liability through inserting in their contract of carriage various exception and limitation clauses, which would otherwise be invalidated by Article III rule 8 of the Hague/Hague-Visby Rules.

The exclusion of deck cargo from the Rules is based on the following interpretation of the Hague/Hague-Visby Rules’ provisions. Since “deck cargo” is not considered “goods” within the definition provided (Article I(c)), the bill of lading does not refer to the carriage of goods, and hence it does not refer to a contract of carriage within the meaning of the Rules (Article I(b)). The provisions of the Rules do not, therefore, apply to such a contract of carriage of deck cargo because the Rules “shall apply to every bill of lading relating to the carriage of goods” (Article X). This interpretation is also upheld and confirmed in The “BBC Greenland.” ¹⁴

However, the mere stowage and carriage of goods on the weather deck of a vessel do not necessarily make these goods “deck cargo” within the meaning provided in the Rules. If one looks closely into Article I(c), it could be seen that there are two conditions that need to be satisfied in order for goods to be considered “deck cargo” and, hence, to be excluded from the scope of the Convention. The first one is the presence of an express statement that goods are loaded and carried on board, which must be unequivocally inserted on the face of the bill of lading. The second condition is that the goods are actually so carried. While the second requirement is a matter of fact, the first one is a matter of contract, and it is this first condition that has been the cause for many disputes and has given rise to various issues before courts.¹⁵ The rationale behind such a strict requirement for an express written statement in the contract of carriage is that, absent such a statement, the carrier will be unable to prove the agreement that it made with the shipper that the cargo would be carried on deck. The express, genuine, and clear written consent of the shipper, on the other hand, is needed because once the shipment is exempted from the Hague-Visby Rules, the parties lose all their rights and defenses under the Convention. It is very important, therefore, that the shipper was sufficiently informed and that it unequivocally agreed on such terms of carriage.

4.3.1 Deck Carriage Performed Within the Ambit of the Rules: Undeclared (Unauthorized) Stowage on Deck

Considering the abovementioned observations, the Rules will still be applicable if there is an express statement or notation on the face of the bill of lading but the goods have been, nevertheless, carried below deck. This is simply because the second, factual condition in Article I(c) has not been fulfilled. An important remark is that the Rules will still apply even when declared deck cargo (meaning that goods are stated as carried on deck and are so carried) has been for some part of the voyage carried on deck but then restowed under deck.¹⁶ A pertinent question is at what point of time does the application of the Rules start—do the Rules apply as of the initial loading of the goods on deck, meaning that they shall apply retrospectively, or do they apply only as of the time when the goods were restowed? The view expressed by the authors of Voyage Charters and by those of Carver on Bills of Lading supports the latter proposition, namely that the Rules apply as of the moment when the goods are restowed below deck because this is the moment when these goods become “goods” within the meaning of Article I(c), whereas it has been underlined that the definition of “contract of carriage” in Article I(b) has been limited by the words “in so far as such document relates to the carriage of goods by sea,” which indicates that during the time when the declared deck cargo is carried on deck, up until the restowage below deck, the cargo does not fall within the definition of “goods,” and therefore the Rules are not applicable.¹⁷ They become applicable after the goods are restowed below deck, when the cargo actually becomes “goods” within the meaning of Article I(c). The same principle would apply vice versa—when the declared deck cargo was initially loaded and carried under deck and then, at a later stage during the voyage, restowed on deck. In this case, the Rules are applicable only with regard to the first part of the voyage when the cargo is considered “goods” within Article I(c), and they do not apply once the declared deck cargo is restowed on deck.

This principle does not run contrary to the tackle to tackle scope in Article I(e) because the “loading” of the goods within the meaning of that article can be considered to be the restowing of the cargo below deck, or, in the second scenario, the “discharge” of the cargo can relate to the restowing of the goods on deck. The restowage itself, below or above deck, may constitute a breach of the contract of carriage, but it may well not be a breach, depending on the terms of the contract, the nature of the goods carried, the nature of the stowage and lashing, as well as the specific circumstances and the parties’ intention. However, any restowage during a voyage should be performed “properly and carefully” in accordance with the obligation set forth in Article III rule 2 of the Rules.¹⁸

Furthermore, the Rules will also apply when part of the cargo is stowed on deck and another part is stowed below deck, without making it clear in the notation on the bill of lading precisely which part of the cargo will be stowed on deck.¹⁹ The problems that can arise in this case are associated with the identification of the cargo that will be carried on deck and that, accordingly, will bear higher risks. The cargo interests, thus, cannot determine the value of the cargo carried on deck and cannot assess the pertaining risks, neither can they make an informed consent that the cargo will be carried on deck. Therefore, and also in the light of The “Rhone,” it seems that unless the consignments of on-deck and below-deck cargo are separate, or unless the notation on the face of the bill of lading is clear as to exactly which part of the cargo will be stowed on deck, the Hague/Hague Visby Rules will be applicable to the entire shipment, and none of the goods carried will be considered “deck cargo” within the meaning of Article I(c).²⁰

All things considered, it is important to note that, throughout this chapter, the term “deck cargo” is used by the author merely to signify the fact that the goods are actually located on the deck of a sea vessel; i.e., the natural meaning of the words is employed. In cases where reference has to be made to the Hague/Hague-Visby Rules’ definition of “deck cargo,” this is explicitly stated, or, else, the words “authorized/declared deck cargo” are used. Conversely, the opposite term “unauthorized/undeclared deck cargo” or “wrongful deck carriage” is used to indicate that goods have been stowed and carried on deck but that they do not qualify for “deck cargo” within the meaning of the Hague/Hague-Visby Rules. In that regard, while some authors draw a distinction between “undeclared deck carriage” and “unauthorized deck carriage”²¹ (the former designating cargo shipped on deck under a “liberty to stow on deck” clause²² but without a statement or notation on the bill of lading stating whether the cargo is actually carried on deck and the latter relating to cargo carried on deck without any clause permitting deck carriage and any statement or notation on the bill of lading), the two terms will be employed in this work as synonyms, which generally describe cargo carried on deck that fails to satisfy the requirements of Article I(c) to be excluded from the Hague/Hague-Visby Rules. The same applies mutatis mutandis to the terms “declared deck cargo” and “authorized deck cargo.”

4.3.1.1 Clause Paramount

The Hague/Hague-Visby Rules may be applicable to authorized carriage on deck as well. This is achieved through a Clause Paramount,²³ which will incorporate the Rules under Article X(c).²⁴ But then these Rules, once incorporated in the contract of carriage, will apply to cargo that is stated as being carried on deck and is so carried, which renders the Rules inapplicable by force of the very same Rules. This conundrum is particularly addressed by authors, and it is underlined that when the Hague-Visby Rules are incorporated in an on-deck bill of lading, it is very important that parties expressly exclude the provision in Article I(c), which excepts deck cargo from the Rules.²⁵ This is also noted in English legislation, where contracts that provide for deck carriage and in the same time incorporate the Rules are indeed subject to the Hague-Visby Rules, ignoring the exception for deck cargo:

If and so far as the contract contained in or evidenced by a bill of lading or receipt within paragraph (a) or (b) of subsection (6) above applies to deck cargo and live animals, the Rules as given the force of law by that subsection shall have effect as if Article I (c) did not exclude deck cargo and live animals.

In this subsection “deck cargo” means cargo which by the contract of carriage is stated as being carried on deck and is so carried.²⁶

What is more, this article goes beyond the mere statutory solution of the problem caused by inserting a Clause Paramount into an on-deck bill of lading. The way it is drafted, the provision suggests that, under English law, any authorized carriage of cargo on deck, to which the Hague-Visby Rules are applicable through a Clause Paramount, will be governed by the Rules as if they have the force of law:

Without prejudice to Article X(c) of the Rules, the Rules shall have the force of law in relation to:

a) any bill of lading if the contract contained in or evidenced by it expressly provides that the Rules shall govern the contract […]²⁷

Thus, contractual incorporation of the Rules, in particular in cases of deck cargo, has the same effect and the same outcome as if the Rules apply by force of law.

For a General Paramount Clause to effectively incorporate the Rules into the contract of carriage that involves deck cargo, it is not sufficient that the clause is only included in the bill of lading, but it must expressly state that it applies to deck carriage as well. A sole Clause Paramount will incorporate the Rules when goods are carried below deck, but it will not extend the Rules to cases of carriage of cargo above deck.²⁸ In other words, the clause does not supersede the exclusion of a deck carriage from the scope of the Rules under Article I(c). Conversely, a Clause Paramount will incorporate the Rules in a contract of carriage of deck cargo if it expressly shows that the parties indeed agreed that the Rules will be applicable to the on-deck carriage.²⁹ An incorporation of the Rules will, thus, be successful with the insertion, for example, of the following clause:

2. General Paramount Clause

The Hague Rules contained in the International Convention for the Unification of Certain Rules relating to bills of lading, dated Brussels 25^th August 1924 as enacted in the country of shipment shall apply to this contract.

9. Live animals and deck cargo

shall be carried subject to the Hague Rules as referred to in clause 2 hereof with the exception that notwithstanding anything contained in clause 19 the carrier shall not be liable for any loss or damage resulting from any act, neglect or default of his servants in the management of such animals and deck cargo.³⁰

4.3.2 Deck Carriage Performed Outside the Ambit of the Rules: Declared (Authorized) Stowage on Deck

If cargo carried on deck complies with the two requirements of Article I(c), namely that it is stated as being carried on deck and is so carried, then such carriage is no longer within the ambit of the Hague or Hague-Visby Rules, but, instead, it is subject to freedom of contract. Thus, the carrier’s responsibility will, in general, not be the same for goods stowed below deck and for goods stowed on deck. What is more, in the case of “deck cargo” within the meaning of Article I(c) of the Rules, the parties to the contract of carriage are at liberty to negotiate their own terms and conditions and to determine their liability and obligations, or to choose another liability regime, which would otherwise not be applicable. In particular, the carrier may invoke contract clauses that, otherwise, would be contrary to the Rules and, thus, struck by Article III rule 8. Another consequence of the exclusion of the application of the Rules is that on-deck carriage of cargo, other than cargo carried in the regular containerized trade where the Rules are in practice rendered contractually applicable,³¹ will be rendered subject to national law, which differs quite a lot from one country to another.³² Accordingly, the admissibility of any contractual provision exculpating the carrier for damage or loss to deck cargo will be assessed depending on the applicable national law.

Considering the foregoing, the most natural consequence for a carrier is to be tempted to insert in the bills of lading clauses that exempt him from all liability whatsoever not only with regard to the “deck cargo” but also with regard to negligence and seaworthiness. However, such clauses are not always welcomed by courts. It is common knowledge that English courts, for example, tend to afford more leeway to parties to shape their contractual relationship, whereas courts in the US tend to be more restrictive when it comes to freedom of contract. If we apply this division to deck carriage, the result is that a clause exempting the carrier from all liability whatsoever may be allowed in England but struck down in the USA as contrary to public policy.³³ Such a clause, which attempts to contract out all liability whatsoever, may also be considered null and void under civil law as against the general assumption of good faith and fair dealing in contracts. Therefore, parties must be careful in which court they bring an action, and private international law plays a very important role in that respect.

Courts in England tend to construe restrictively statements or notations on the bills of lading stating that the cargo will be carried on deck, which are intended to produce the effect of excepting the carriage from the Rules. The rather high standards can be explained with the need of protection of shippers, consignees, or third-party bills of lading holders. As stated elsewhere, they all must be well informed about the risks involved in the shipment.³⁴ Thus, if an on-deck statement, which purports to exclude the carriage from the ambit of the Rules, is unclear or ambiguous, the Court will apply the contra proferentem rule and construe this statement or notation, as well as any ambiguity, against the party that drafted it, namely the carrier.³⁵ Moreover, it is the carrier that bears the burden of proof to establish, should there be any ambiguity, that the statement is indeed one that in fact states on-deck carriage.³⁶

The standard for assessing the admissibility of a statement that cargo will be carried on deck varies from case to case, but, as an example, the following notation in The “BBC Greenland” ³⁷ was accepted by the Court as a valid notation, which excluded the goods from the Hague-Visby Rules for being “deck cargo”:

MASTER’S REMARKS

— ALL CARGO LOADED FROM OPEN STORAGE AREA

ALL CARGO CARRIED ON DECK AT SHIPPER’ S/CHARTERER’S/RECEIVER’S RISK AS TO PERILS INHERENT IN SUCH CARRIAGE, ANY WARRANTY OF SEAWORTHINESS OF THE VESSEL ESPRESSLY WAIVED BY THE SHIPPER/CHARTERER/RECEIVER.

AND IN ALL OTHER RESPECTS SUBJECT TO THE PROVISIONS OF THE UNITED STATES CARRIAGE OF GOODS BY SEA ACT 1936. […]

The carriage was a second shipment of sand filter tanks for a water treatment plant from Italy to Alabama between the same parties under a fixture recap, which stated: “shipment under/on deck in owners’ option, deck cargo at merchant risk and b/l to be marked accordingly.”³⁸ The first shipment of 13 tanks, most of which carried on deck, was completed without incidents. The current case concerned the second shipment of 10 filter tanks, which were carried on the deck of BBC Greenland under a bill of lading with the above notation on its face. On the reverse of the bill, there were terms that provided for the application of the Hague Rules as enacted in the country of shipment (which was Italy, where the Hague-Visby Rules were enacted), and for London arbitration and the application of English law.

During the journey, one tank was lost and another was damaged. One of the main questions was whether this provision on the bill of lading was to be interpreted as a statement that sufficiently specifies that the tanks were indeed carried on deck or whether it was a mere warning of the perils inherent in such carriage. The Court held that the tanks were “deck cargo” within the meaning of the Hague/Hague-Visby Rules. What the Court took into consideration was, firstly, the master’s remark on the face of the bill of lading, which was construed as a statement of fact regarding the mode of carriage and which was not considered ambiguous; secondly, the previous business conducted between the parties where the same remark could only be understood as an on-deck statement; thirdly, that a reasonable third-party transferee of the bill of lading would be able to ascertain from the terms on the bill whether the cargo was in fact carried on deck or under deck.³⁹

As a result, the Hague-Visby Rules did not apply to the carriage because the parties did not extend their application to cover deck cargo as well, which they could have done. The Court, however, underlined obiter that if the cargo had been carried below deck, then the Hague-Visby Rules would have applied with the force of law. Yet, under the circumstances in the present case, the “deck cargo” notation excluded the Rules, whereas US COGSA 1936 applied because the bill of lading expressly provided so. US COGSA 1936, on which the parties expressly agreed on the face of the bill, was considered by the Court as a different and inconsistent regime to the Hague/Hague-Visby Rules.⁴⁰ Consequently, the carrier could pursue liability exemption under the exemption clause contained in the on-deck statement on the face of the bill of lading, or pursue limitation of liability under US COGSA 1936, which is generally more favorable to carriers compared to the limitation of liability provision set forth in the Hague-Visby Rules. Also, the contractual provision that the parties may commence suit in a US court of proper jurisdiction if US COGSA 1936 is applicable to the contract was also upheld. Again, the English court pointed out that the parties contractually bestowed exclusive jurisdiction upon American courts only in the event that US COGSA 1936 would apply to the carriage; therefore, should the Hague-Visby Rules were applicable (i.e., should cargo be not considered “deck cargo”), then American courts would not have had jurisdiction.⁴¹

This case is a good example of how dramatic the changes may be for the parties involved, from a legal perspective, if a statement or a notation on the face of the bill of lading is regarded by the Court as a statement for “deck cargo” within the meaning of Article I(c) of the Hague/Hague-Visby Rules.

However, whether cargo carried on deck is considered “deck cargo” for the purpose of the Hague-Visby Rules is not always subject to the same determinants. Although there is an apparently uniform distinction between authorized and unauthorized deck carriage, it is not all black and white when courts have to consider whether certain carriage on deck is legal or not. One has to put this distinction between legal and illegal deck carriage into the particular context in order to reach an objective assessment of the legality of the deck cargo.

Most importantly, courts will assess three major factors when drawing the line between legal and illegal deck cargo. First, it must be established how objectionable the increase of the risk is when cargo is carried on deck. This comes down to the question whether the cargo is suitable for being loaded and carried on deck. As stated elsewhere, the risk varies as it could be significantly minimized in certain trades, but it could also well be significant, for example, for sensitive goods that are not suited for transportation on the weather deck. Similarly, the type and design of the vessel has also bearing on the increase of the risk with regard to the carriage of cargo on deck. The second factor that is to be weighed is how objectionable the liability exemption clauses are. In particular, it must be established whether carriers—in their attempt to limit or exclude liability altogether—have impaired the balance of interests of the carrier and of the cargo owners.⁴² Third, due regard must be given to the issue of how clearly all those risks and exemptions pertaining to deck cargo have been communicated to the cargo interests. In other words, is the shipper aware of such carriage arrangements?

Perhaps what makes deck cargo so difficult from a legal point of view is that these different factors stated hereabove are weighed differently under different jurisdictions. Hence, there are different results in adjudicating.

4.4 Current Law on Deck Cargo: How Technology and Modern Practices Remodeled the Old Doctrine

The previous section sought to establish that, under the traditional deck cargo doctrine reflected in the Hague-Visby Rules, there was a clear connection between a clean bill of lading and the obligation to stow the cargo below deck.

This, however, has changed throughout time, and the evolvement in the views on deck cargo took place gradually, fostered by the expanding trade and the technological and shipping developments. The major risk-determining factors related to deck cargo are the nature of the cargo and the nature of the carrying vessel, both of which have substantially evolved in the twentieth century. The leading liability regime, on the other hand, has not changed since 1924 as the 1968 amendment did not introduce any revision of the Rules as far as deck carriage is concerned. However, courts interpreted the Rules differently throughout the years in accordance with the prevailing views on deck cargo at that time.⁴³ Especially with respect to containerized cargo, a different rule has evolved, which renders the old doctrine on deck cargo inapplicable in many jurisdictions.⁴⁴ English courts, in particular, have come a long way struggling to catch up with the developments in the shipping world and to close the gap between a legislation based on shipping realities that date back almost a century ago, on the one hand, and the modern-time business and trade practices, on the other.

Currently, there are three permissible ways to carry cargo on deck—by custom, by an agreement, or by a convention.⁴⁵ The following subsections will review each of these authorized ways of deck carriage, preceded by a factual analysis of the risks relating to deck cargo.

4.4.1 Factual Study

4.4.1.1 Assessing the Risk of Carrying on Deck

Merely 100 years ago, when the Hague Rules were drafted, and well before the advent of containerization, stowage of cargo on the weather deck substantially augmented the risk for the goods as they could be either washed away or damaged as a result of breaking-wave impact or of the intensified forces exerted on the deck cargo because of pitching, rolling, yawing. Furthermore, vessels were exposed to a greater degree to forces exerted by wind and waves as a result of the cargo towering from the weather deck upward, which diminished the vessel’s stability whereby listing and even capsizing was much more likely. Such augmented forces, acting on the vessel, could even result in losing her rudder and thus rendering her unseaworthy.

Given the design of the vessels at that time, which were mostly shaped to carry goods below deck, all those risks were inherent to the carriage on deck, and that is why the carrier was usually held liable for stowing goods on deck, and in some jurisdictions, it was not extraordinary to apply the deviation rule to a carriage on deck.⁴⁶ Accordingly, the views on deck cargo were quite negative, and the doctrine in that time, as observed above, was very restrictive. It is, thus, obvious that the doctrine on deck cargo is closely related to the risks, to which the goods carried on deck are subjected. Therefore, in order to assess the current law on deck cargo, a factual background will be carried out in order to see to what extent those past risks related to deck cargo have been mitigated nowadays, given the modern shipping practices and innovations.

Undoubtedly, containerization is a central issue when discussing the nowadays’ risks posed by the carriage of goods on deck. The fact that there are bigger and bigger container vessels being built as the current capacity of the biggest container ships today reaches up to over 20,000 containers, it is obvious that the problem of on-deck stowage of containers will be of even growing importance in the future. The types of goods that can be transported in a container are almost limitless, and that is why containerization comprises the vast majority of the cargo transported by sea nowadays. Besides the changes that it brought to the shipping industry, the shipping container has significantly reduced some of the risks inherent to the stowage on deck such as damage, loss, or pilferage. The structure of the container affords extra protection in comparison to other packaging materials. What is more, the so-called reefer containers, for example, provide constant refrigeration of the cargo packed inside while being water and light resistant, as well as fully operational at outside temperature of up to 50 °C.⁴⁷ This allows perishable goods to last for much longer. Another example of the diminished risk provided by the containerized shipments is that today it is sufficiently safe to transport in containers, below or above deck, of relatively sensitive pieces of cargo such as family cars. Automobiles can be now shipped not only via a ro-ro vessel but also on a container vessel, which is evidence of the reduced risks and safety provided by the “box.”

Statistical data reveal the quantitative aspects of the risks related to the carriage of cargo on deck and show how much these risks have shrunk in the recent years due to the technological advancements, the innovative ship designs, and the ceaseless efforts of the shipping industry to improve safety.

Although comprehensive statistics about deck cargo that has been lost overboard does not exist, the World Shipping Council (WSC) carried out a survey among its members in the recent years, which can be quite indicative, considering the fact that the WSC’s members represent approximately 90% of the global containership capacity.⁴⁸ The survey was conducted in 2011 and was later updated in 2014 as each survey comprised statistical data for a period of three consecutive years. The results from the first survey showed that, for the period 2008–2010, there were approximately 350 containers lost per year on average, without counting the catastrophic losses.⁴⁹ The data for the period covering the years 2011–2013 revealed 733 containers lost at sea per year on average. Considering the total number of containers shipped annually at that time, which was about 100 million and 120 million containers, respectively, the lost containers represent only a negligible fragment of the total amount of containerized cargo shipped worldwide. To be precise, these amount to about 0.00035% of all containers worldwide during the first survey period and about 0.00061% with regard to the second survey period. Although there seems to be a significant rise in the number of containers lost overboard, the loss of deck cargo in terms of percentage has actually negligibly changed when taking into account the increase in the total quantity of containers carried by sea worldwide from 100 to 120 million containers during the second survey period.

And to be even more accurate, it has to be reminded that the world’s total container shipments, obviously, comprise both containers carried below deck and containers carried on deck. That is why, in order to measure more accurately the risk of carrying goods on deck, one has to give an account of the losses related only to the total amount of containers carried on deck, which can safely be assumed to be approximately half of the entire seagoing container trade.⁵⁰ In other words, to reflect the precise fraction of the lost containers carried on deck, one has to double the abovementioned percentages. But even in this case, or even if those are tripled, the fraction of deck containers lost overboard is so minute that it better be measured not per cent but per mille (‰) or even in parts per million (ppm).

These encouraging results as regards containerized goods carried on deck are largely due to the advancement of the shipping industry nowadays and the practices and projects carried out toward enhancing cargo safety. In particular, the seafaring industry has been targeting the major reasons for loss of or damage to deck containers, namely improper packing, poor stowage, insufficient lashing as well as structural failure of the container.⁵¹

However, it must be admitted that the losses of or damage to containers stowed on deck still surpasses the losses of or damage to containers stowed in the hold below deck. Besides the cargo-related damages or losses, incidents with containers may endanger the safety of the vessel or of other vessels, especially smaller craft and fishing boats.⁵² Semi-submerged containers may become a threat to navigation and to the environment as well, especially if they are used for the shipment of hazardous cargo.

Therefore, the major causes for accidents with containerized vessels will be examined below because they are the gist of the risks associated with the carriage of cargo on deck. These reveal the qualitative aspects of the risks of carrying goods on deck and are mainly associated with stowage and securing of the cargo on deck.

With regard to securing, the vessel Santa Clara I, which lost 21 containers off the cost of New Jersey, US, in early 1992, is a prominent example. This was a major accident because four of the containers comprised hazardous cargo (arsenic trioxide). The subsequent thorough investigation conducted by the Coast Guard revealed that the reason for the misfortune was a failure in securing the cargo, which was attributed to a human error coupled with bad weather.⁵³ In particular, the report revealed both mechanical and operational weaknesses. The former included insufficient wire lashings; improper installations of those lashings; use of damaged lashing gear; improper stowage of 20-foot containers in a 40-foot cell, which left each container unsecured on one end; loose hatch covers (being the foundation of the on-deck tiers of containers), which allowed for lateral movements of the stow. The operational weaknesses consisted of noncompliance with the recommended international standards on cargo securing—the IMO’s Cargo Securing Manual; lashing of the deck cargo performed underway during heavy weather, meaning that the standard of care prescribed by Article III rule 2 of the Hague/Hague-Visby Rules was not met; failure to make an accurate assessment of the storm and the wind and to take appropriate actions to avoid the deteriorating weather, meaning that the master has failed in navigating the ship.

As a result of that accident, it was recommended that the International Maritime Organization’s (IMO) voluntary guidelines on cargo securing be adopted as a mandatory regulation within the International Convention for the Safety of Life at Sea (SOLAS).⁵⁴ This took place in the 1994 amendments to SOLAS.

As far as stowage is concerned, these operations are vital for the safety of the cargo and of the vessel herself. In practice, heavier containers must be stowed on the bottom, whereas the upper tiers must consist mainly of light containers. This system for stowage on deck minimizes the risk of collapsing of containers as a result of excessive loads applied on the lower tiers, and it also diminishes the forces and the acceleration acting on the gear securing the upper tiers of containers.⁵⁵ In this way, the vessel’s stability is also optimized. Unfortunately, there are several drawbacks pertaining to these safety policies.

In the first place, there is no internationally recognized standard to define a heavy or a light container, which does not help container operators to plan accordingly. The lack of international regulations to that regard also lead to undesirable discretion as to which container is considered heavy and which light.

In the second place, the stowage and securing plans aboard a container vessel assume, but cannot guarantee, that the cargo within the container is properly stowed and secured as the latter task is usually outside the carrier’s obligations over the cargo. To that regard, heavy equipment that is not properly secured within a container may pose serious risks to the entire stow as it may break loose, pierce the container wall, and come outside damaging adjacent containers stowed on deck. Such incidents may often lead to a domino effect as well.⁵⁶ However, the drawback of the carrier not being familiar with the contents of the container and with whether the goods inside have been properly secured and stowed does not apply to the situation where it is indeed the carrier that has supplied, stuffed, and loaded the container on deck. In this case, those specific risks described to deck carriage do not exist as the carrier will be fully familiar with the weight distribution and the securing specification of the containerized goods.

In the third place, in practice carriers often continue accepting additional cargo when the vessel has berthed and the contracted cargo is already being loaded. The reason behind that practice is a commercial one—the more cargo put on board, the more freight earned. However, this also means that if heavy containers arrive late, they may well be placed on top of a tier, which undermines all the safety precautions of the stowing plans and makes them virtually obsolete.⁵⁷

In the fourth place, a common problem to nowadays container shipping is the misdeclaration of the weight of a container. Often containers are overloaded, which creates the same kind of risks as the ones outlined in the previous setback. A prominent example of those risks that accompany overloaded containers is the 2007 accident with the MSC Napoli in the English Channel. An investigation conducted by the UK Maritime Accident Investigation Branch (MAIB) revealed that 137 out of the 660 containers stowed on deck were overloaded (e.g., heavier cargo was loaded than what was declared).⁵⁸ This means that about 20% of the deck cargo was in fact weighing more than what was recorded on the bill of lading and, accordingly, on the cargo manifest. The difference varied from 3 to 20 tonnes as the total surplus of weight was 312 tonnes. The result was that the container vessel sustained catastrophic structural damages, which led to an ingress of water into the ship through an opening in the starboard forward of the engine room, and eventually the crew was forced to abandon the vessel.

A similar accident occurred with the container ship Deneb, which suffered in 2011 a critical stability accident at the Port of Algeciras, Spain. The vessel started listing to her starboard until the entire starboard and bow were submerged. It was later established that out of the 163 containers on board, there were 16 that had an actual weight that exceeded the declared weight, and they were stowed high above on deck. Thus about one-tenth of the containers were misdeclared, and they were deck cargo. This excess in weight ranged from 1.9 times to 6.7 times as the total surplus weight of the 16 misdeclared containers amounted to 278 tons instead of the declared 93 tons. Coupled with the fact that the overweight containers were stowed on deck, which additionally affected the stability of the vessel, the overall four times higher weight of the 16 misdeclared containers was considered the prime reason for the accident.⁵⁹

To summarize, the statistical data adduced to measure the risks of deck carriage point to the conclusion that deck cargo in the beginning of the twenty-first century enjoys considerably higher protection than before, which is a result of the developments in the industry, as well as of the purposeful efforts of international bodies toward improvement of stowage, securing, and lashing. Furthermore, the analysis of shipping losses evidences that among the main reasons there are insufficient knowledge, inadequate skills, human errors, as well as failure to understand or apply stowage and securing regulations. None of these, however, is inherent to deck carriage. On the contrary, the following subsection will evidence that some ship designs may even reduce the human factor when it comes to securing the cargo on deck.

4.4.1.2 Ship Design

As implied above, the risks related to deck carriage are greater when older vessels are involved. At the beginning of the container transport era, containers were shipped mostly on general cargo vessels, which posed considerable risks for the safety of the cargo, the crew, and the vessel itself. What is more, this was equally true for containers stowed under deck as well because the cargo holds of those ships were not designed for the carriage of such huge units such as the TEUs or FEUs, which caused all kinds of stowage problems, especially when containers of different sizes and dimensions were loaded next to or on top of each other.⁶⁰ However, nowadays there are many types of cargo vessels specifically designed to carry containers such as multipurpose container vessels, semi-container vessels, all-container vessels, feeder vessels, open-hatch container vessels, etc. Regardless of their specific type, modern container vessels are broader amidships, and, thus, they can counter stability issues that arise from the heavy and tall loads on deck.

Today’s container vessels are specially built to carry containers on board. Their hull is designed to have numerous cells within a hold, as well as specially created vertical slots where containers are stowed. There is no separation between the holds in such a vessel; instead, every hold has cell guides, which are, in essence, vertical rails that allow the containers to be stacked vertically one on top of the other. Where the below-deck containers are fixed by means of these rails, above-deck containers may be secured either with manually applied lashings or tension rods or with the same cell guide structure that is applied below deck. Such ships are referred to as “fully cellular” or “purpose-built,” and their design provides to stow more than half of the containers on deck, while for the smaller vessels the figure can even go up to three-quarters of the containerized cargo.⁶¹

Two major points can be inferred from this factual information. First, since a considerable part of the cargo shipped on a modern container vessel is carried on deck, there is nowadays little significance in the distinction between carriage on deck and below deck. Second, while it must be admitted that deck-cargo-related accidents still occur (but so does accidents with below-deck cargo), the ever-growing number of containers transported over sea, of which a huge percentage is on deck, is a clear indication that the risks taken in such a carriage are not unreasonable.

Furthermore, some of nowadays’ container vessels are even missing hatch covers and are, therefore, open-hatch container ships.⁶² So, in a sense, such vessels cannot be said to transport cargo on deck since the latter is in fact missing. However, provided that such a shipment exposes the cargo to the same risks as the carriage of goods on the weather deck, it is considered deck carriage as well regardless of the fact that the containers are actually loaded on the tanktop and stowed in tiers upward up to several levels above “the deck” as the cell guides extend to the full technically permissible height of the deck cargo to reach even the uppermost part of a container tier (a vertical stack).⁶³ This increases the safety of the containers stowed “above deck” as those containers, stowed in the higher part of a tier, are well secured to the fixed cell guides, and no manual lashing with cables or rods is needed, which would be the case, for example, with on-deck containers stowed on the hatch cover of a conventional container vessel. Besides minimizing the risk of containers shifting, collapsing, or being washed overboard, a hatchless design provides several other important advantages: firstly, by eliminating the hatches, the deadweight tonnage⁶⁴ of the vessel is increased, meaning that she can carry more cargo, while at the same time the vessel’s stability is improved as significant weight is removed from the upper part of the hull; secondly, without having the need to open or close hatches, loading and discharge operations are performed much faster, which diminishes costs; thirdly, an entire tier of containers is at any time accessible, whereas on conventional container vessels with hatch covers it is required to first unload the on-deck containers and open the hatches before having access to the containers stowed below deck.⁶⁵ With regard to the vessel’s protection from rainwater or seawater getting into the hold, open-top container ships are either equipped with rain-protection roof made of lightweight steel or with bilge pumps that are taking the water out of the hold and thus preserving the ship’s stability and protecting the stowed containers.

Smaller container vessels, designed to carry between 100 and 800 containers, generally referred to as feeder vessels, pose additional risks to the cargo stowed on deck as their freeboard is significantly lower as compared to bigger container vessels. This means that the cargo stowed on the deck of such vessel is exposed to a bigger extent to sea water and to damage of breaking waves, as well as wetting. A concession must be made that feeder ships, like all coasters,⁶⁶ usually call at smaller ports, and their service is involved in regional or coastal trade, meaning that they are less likely to encounter adverse weather conditions to the same extent as, for example, a transoceanic container vessel crossing the North Atlantic. Nevertheless, it can be generally assumed that smaller container vessels, with their low freeboard, afford less protection to deck cargo from wetting damage or breaking waves.

Besides container ships, there are nowadays a myriad of other vessels that are designed to carry goods on deck. These are, for example, general cargo vessels, cellular vessels, supply vessels, bulk vessels capable of carrying nonbulk cargo, heavy-lift ships, semi-submersible ships, freight ships carrying packaged or break bulk cargos, etc.

Furthermore, there are other trades where combined transport units, apart from containers, are carried both below and on deck. Depending on the method in which the cargo is handled in the particular trade, the carrying vessels have acquired the respective name. Examples of such vessels are the ro/ro (roll-on/roll-off),⁶⁷ the lo/lo (lift-on/lift-off),⁶⁸ sto-ro (stow and roll),⁶⁹ flo/flo (float-on/float-off),⁷⁰ wo/wo (walk-on/walk-off).⁷¹

4.4.1.3 Conclusion

To sum up, this reality check shows that the risks posed to deck cargo differ significantly nowadays as compared to those that were present at the beginning of the twentieth century when the Hague Rules were drafted. Back in those times, deck cargo was viewed as an inherently risky transport arrangement, and that is why it was vital at the time that the shipper had expressly consented to assuming all the risks pertaining to deck carriage by means of an express agreement stated on the face of the bills of lading.⁷² However, while a century ago all risks were inherent to the carriage on deck, the risks nowadays consist of operational risks, which can be more easily described as operational and mechanical weaknesses. This means that these risks do not originate from deck carriage per se. Therefore, deck carriage as such is no longer so risky as to restrict it altogether. What is more, the numbers of lost deck containers suggest that the loss of deck cargo is ever less likely, and the risks related to the carriage on deck have nowadays diminished to such an extent as to justify such practice.

Furthermore, the examples of ship designs that were provided demonstrate how a modern design can not only enhance the versatility of the vessel but can also ensure additional safeguards to cargo carried on the deck of modern vessels. In particular, current container vessels are technologically advanced, and their hull design reduces the risk of listing and capsizing. Also, as far as oceangoing container vessels are concerned, the risks are considerably minimized with regard to loss of or damage to the cargo as a result of a breaking wave or of the rolling, pitching, or yawing motion of the vessel during a storm.

Thus, the results of this factual study (i.e., that, in general, risks related to deck cargo have significantly diminished) allude to the presumption that the interpretation of the contract of carriage by the courts should not be so restrictive anymore. With regard to English law, this development toward a less restrictive regime will be observed further in Sect. 4.5, whereas Sect. 4.6 will summarize to what extent the traditional doctrine on deck cargo is still applicable in various other jurisdictions.

4.4.2 Deck Cargo as a Custom in the Trade

4.4.2.1 Containerization

The invention of the container, also called the box, revolutionized the shipping world and global trade.⁷³ It introduced dramatic changes in both the supply chains and the way of transporting vast quantities of goods over sea. With regard to the subject matter of the current chapter, it is sufficient to note that containers and containerization has turned the carriage of goods on deck much into a norm rather than an exception, and courts have begun to recognize that reality.

Throughout the years, there has been a debate whether the carriage of containers on deck has turned into a customary practice. As early as in the 1960s, there were proponents of the argument that carriers had the general liberty to stow containers on deck based on a well-established custom and usage concerning containerized cargo, which was considered tantamount to an implied clause in the contract of carriage, with which shippers were deemed to have agreed.⁷⁴ Similarly, today’s authors are of the opinion that shipping containers on the deck of a vessel that is specially designed to carry containers has nowadays turned into a recognized custom in the container trade.⁷⁵ Such carriage can be exercised under a general liberty clause, meaning that no express statement or notice is needed on the face of the bill of lading, making deck carriage of containers not an exception but an alteration of the Hague/Hague-Visby Rules. This alteration of the Rules is overall considered permissible, but uniformity in that respect is not present.

The lack of uniformity is largely due to the fact that the concept of authorized (legal) deck cargo, as derived from the Hague-Visby Rules, is not equally perceived and applied in the various jurisdictions and also in the various situations of deck carriage. With regard to the various circumstances of carriage on deck, open-hatch (hatchless) containership, for example, cannot be deemed to be capable of transporting cargo on deck illegally. That is to say, in such cases, the literal interpretation of Article I(c) of the Rules becomes obsolete and unnecessary. As far as the differing views of various jurisdictions are concerned, the notion of authorized and unauthorized deck carriage may vary depending on the courts’ interpretation of how clearly the intended deck carriage has been communicated from the carrier to the shipper (i.e., the presence of an informed agreement).

In Belgium, for instance, there is a strict adherence to the traditional doctrine on deck cargo even with regard to container vessels. Belgian courts are very harsh toward carriers when loss or damage is caused as a result of undeclared deck cargo even if it has been stowed in containers on the deck of a specially built container vessel unless this vessel is of the type of an open-top (hatchless) container vessel—only in that latter case will an exception be made from the judicial practice on deck cargo.⁷⁶ Thus, under Belgian jurisprudence, a clean bill of lading will almost always signify that the cargo is stowed below the deck, and should cargo be carried on deck, a third-party holder does not have to prove negligence on behalf of the carrier to hold him liable. The very act of stowing on deck under a clean bill of lading represents an act of negligence under Belgian law, and the carrier cannot rely neither on the liability limitation and exceptions in the Hague-Visby Rules nor or on any liability-exemption clauses in the bill of lading.⁷⁷ This is an example of how the changed standard in defining the difference between authorized (legal) and unauthorized (illegal) deck carriage has an impact upon the acceptability of any attempted exemption clauses. Sections 4.5 and 4.6 below reveal further the nonuniform approach toward what constitutes authorized deck cargo within the meaning of the Hague-Visby Rules, which in the end creates differing rules on national level, which in some instances may overprotect deck cargo interests but in others may seem to provide them with insufficient protection.

Regardless of the lack of uniformity in the treatment, the carriage of containers on deck is nowadays largely accepted as an inherent characteristic of the container trade, and that is why it is considered as authorized deck carriage regulated by the Hague/Hague-Visby Rules, notwithstanding that there will be normally no statements or notations on the bill of lading as to the precise location of the container.⁷⁸ An exception to that general rule can be made only for goods that require under-deck stowage. Moreover, the impressive share of containerized shipments nowadays (more than 85% of the total cargo) and the fact that, in container arrangements, there are inevitably containers stowed on deck also suggest a well-established custom of deck carriage within that trade.⁷⁹

For the current chapter, it is of material importance to underline that while the industry practice is to include in the contract of carriage a statement “carried on deck,” which represents the express agreement between the parties and excludes the application of the Rules, this practice is not exercised when containerized cargo is carried on deck.⁸⁰ On the contrary, depending on the trade, contracts of carriage related to containers carried on deck very often provide for the application of the Hague/Hague-Visby Rules.⁸¹ The rationale behind the absence of a deck statement or notation is that in the containerized trade it is sometimes not known, by the time the bill of lading is issued, where exactly the container will be placed—on deck or below deck. That is to say, there are some specific organizational and operational difficulties—such as the weight of the container and its destination—that prevent it to be ascertained in advance whether a container will be stowed on deck or in the hold. Instead, this usually becomes clear as late as in the moment of loading, which makes it impossible for a carrier to comply with the formalities required by Article I(c) of the Hague-Visby Rules in order for deck cargo to be considered legally carried.⁸²

Moreover, issuing on-deck B/L in advance is not wise because it will render the cargo not subject to the Hague-Visby Rules, and thus such a bill may not be accepted by banks, which may impair credit payment arrangements such as a letter of credit.

That is why nowadays container liner carriers usually issue bills of lading without an “on deck” notation but only relying on a liberty clause to stow on deck. Below is an example of terms and conditions relating to deck stowage:

18. Optional Stowage, Deck Cargo and Livestock

18.1 The Goods may be packed by the Carrier in Containers and consolidated with other goods in Containers.

18.2 Goods whether packed in Containers or not, may be carried on deck or under deck without notice to the Merchant. The Carrier shall not be required to note, mark or stamp on the bill of lading any statement of such on deck carriage. Save as provided in clause 18.3, such Goods (except livestock) carried on or under deck and whether or not stated to be carried on deck shall participate in general average and shall be deemed to be within the definition of goods for the purpose of the Hague Rules or US COGSA and shall be carried subject to such Rules or Act, whichever is applicable.

18.3 Goods (not being Goods stowed in Containers other than flats or pallets) which are stated herein to be carried on deck and livestock, whether or not carried on deck, are carried without responsibility on the part of the Carrier for loss or damage of whatsoever nature or delay arising during the Carriage whether caused by unseaworthiness or negligence or any other cause whatsoever and neither the Hague Rules nor US COGSA shall apply.⁸³

The shipper’s consent for deck stowage is deemed to be given upon acceptance of the carrier’s tariff rates. The rationale is that the freight for shipping on deck and the freight for shipping below deck differ, and the rate for deck carriage is usually lower. Needless to elaborate much, the freight rate for cargo stowed below deck is higher than that for cargo stowed above deck because, although the risks for deck cargo have significantly diminished as illustrated in Sect. 4.4.1, the losses of containers shipped on deck still prevail over those of containers carried in the hold. This means that both deck cargo and goods stowed in the holds are subject to the same regime despite the differing risks. Consequently, when it comes to the protection afforded by the Rules to the cargo interests, the owners of deck cargo may be deemed worse off as opposed to the owners of cargo stowed in the holds of the vessel.⁸⁴

The logical question that arises then is whether a shipper can insist on under-deck carriage. In other words, to what extent is a shipper able to regulate this part of the contract of carriage with a container liner operator and stipulate that his containers must be stowed below deck? In practice, shippers can have specific stowage requirements and arrangements, and demanding below-deck stowage is not only possible but also necessary, especially when the shipment consists of goods that are not suitable for deck carriage. An example of such cargo is sensitive electronic equipment or foodstuffs that may have to be carried in refrigerated or ventilated containers below deck in order to prevent damage from solar radiation, sea or rainwater, or excessive temperature variations. To request such a stowage arrangement, shippers must indicate their preference in the Export Cargo Shipping Instructions form that is provided by the carrier or the freight forwarder. It is important to note that, in practice, such shipping instructions are taken into consideration by the carrier if they are justified in the sense that the nature and properties of the goods stowed in the container indeed require below-deck stowage.⁸⁵ In other instances, carriers may ignore a shipper’s request to stow a container below deck when the carriage takes place on a regular container vessel. This was also noted by the US District Court (Southern District of New York) in the case The “Red Jacket”:

Since this was a container ship, it was equipped to carry containers on the weather deck as well as in the hatches. Consequently, a request for below deck stowage, unless the cargo was marked dangerous, would be ignored. The Court finds that [the carrier] AEL was not negligent in stowing the ingots on deck.⁸⁶

4.4.2.2 Other Trades

There are other trades besides the container trade, where the carriage on deck has become a custom. The carriage of heavy logs on deck, for example, has been for a long time recognized as a custom in the trade.⁸⁷ In general, trades where such customs have been established encompass the transportation of all kinds of out-of-gauge cargo and certain kinds of bulky cargo, which cannot be stowed in the hold because they would not even physically fit inside, such as roundwood logs (timber), railway engines, cranes, wind turbine generators, as well as oil platforms, drilling rigs, and even other seagoing vessels. In those instances, the carrying ship is specially designed for carriage on deck such as purpose-build log-carrying vessels, heavy-lift vessels, or semi-submersible vessels (flo/flo). Such vessels have much greater lifting capacity than conventional ships, and their deck area is far more spacious in order to accommodate bigger and heavier cargos.

A custom should be distinguished from a practice. To be recognized as a custom, a practice must be not only common or usual, but it must also conform to certain requirements. In The “Sormovskiy 3068,” it was established that a custom must be reasonable, certain, consistent with the contract, and universally acquiesced, and it must not be contrary to law.⁸⁸ What is more, a custom does not have to be applicable to all ships or trades, but just to the particular vessel that is engaged in the particular trade.⁸⁹ A carrier, however, cannot rely on an established custom within a particular trade in order to exculpate himself for the carriage on deck if this is done in breach of an express agreement to carry below deck. The latter represents a breach of a condition and is, thus, a deviation from the contract that cannot be justified with an established custom within the trade.

4.4.3 An Express Agreement Between the Parties to Carry the Goods on Deck

As pointed out in Sect. 4.3 above, deck carriage is excepted from the Hague and Hague-Visby Rules only when there is an express statement or notation on the face of the bill of lading that the cargo will be carried on deck and when it is in fact carried on deck. An important remark is that a sufficiently clear statement is not needed in the occasion when the goods are subject to provisions that require the stowage on deck. This is because deck cargo is permissible also when it is required by a convention or arises out of statutory obligations of the carrier. In this case, the agreement between the parties to carry on deck is implied. This could be best illustrated by the carriage of dangerous goods and of solid bulk cargos, which are regulated by the IMDG Code⁹⁰ and the IMSBC Code,⁹¹ respectively.

The IMDG Code distinguishes between five stowage categories: Categories A, B, and E allow the carrier to stow the cargo both on deck and below deck, while Categories C and D require that only on-deck stowage and carriage is performed.⁹² Thus, for example, methyl iodide⁹³ (Category C) and methyl bromoacetate⁹⁴ (Category D) must be stowed always on deck. The IMSBC Code, on the other hand, also have provisions on stowage and securing. Regulation 7 of the Code admits that solid bulk cargos may be carried on deck as well: “Cargo, cargo units and cargo transport units carried on or under deck shall be so loaded, stowed and secured as to prevent as far as is practicable, throughout the voyage, damage or hazard to the ship and the persons on board, and loss of cargo overboard.” In particular, the Code provides four segregation terms for materials possessing chemical hazards: “away from,” “separated from,” “separated by a complete compartment or hold from,” and “separated longitudinally by an intervening complete compartment or hold from.” With regard to the first two terms, solid bulk cargos may be stowed on deck as well provided that the safety precautions are fulfilled.⁹⁵

In other instances, however, the agreement between the parties must be evidenced by a statement in the bill of lading. The question that naturally follows is whether a clause inserted in the bill of lading, which allows the carrier to stow on deck, can qualify for such a statement or notation that proves the express agreement between the carrier and cargo interests.

Both English case law and legal literature are unanimous on that matter. A Liberty to Stow on Deck clause is deemed to merely clarify where the goods may be stowed, but it is not tantamount to a license or permission to stow the goods on deck.⁹⁶ In Svenska Traktor v Maritime Agencies (Southampton), Lord Pilcher J held that a general liberty clause could not qualify for a statement in the contract of carriage, within the meaning of Article I(c) of the Rules, that the goods were indeed carried on deck. He described such a statement, as opposed to a liberty clause, “as a notification and a warning to consignees and indorsees of the bill of lading to whom the property of the goods passed […] that the goods which they were to take were being shipped as deck cargo.”⁹⁷ In the presence of such a statement indicating on-deck carriage, the cargo interests will be fully knowledgeable on the terms of the contract, whereas the insertion of a general liberty clause does not provide the same certainty as to where the cargo will actually be stowed and carried.

In Svenska Traktor v Maritime Agencies, the liberty clause found at line 76 of the bill of lading read:

Steamer has liberty to carry goods on deck and shipowners will not be responsible for any loss, damage, or claim arising therefrom.

Interestingly, the clause was considered by the judge as one containing two parts, and it was the second part, the one relieving the shipowners from liability, that ran against the Rules and was, therefore, held null and void under Article III rule 8. The first part of the clause, the one preceding the conjunction “and,” was held to be valid subject to the carrier’s obligations under Article III rule 2.⁹⁸ The conclusion is that a “Liberty to Stow on Deck” clause is not equivalent to a statement within the meaning of Article I(c), and therefore it does not make deck cargo falling outside the definition of “goods” and, accordingly, outside the scope of the Hague and the Hague-Visby Rules. Nevertheless, a liberty clause, while not excluding the application of the Rules, allows the shipowners to stow the cargo on deck as long as they properly and carefully load, handle, stow, carry, keep, and care for the goods concerned.

The decision in Svenska Traktor v Maritime Agencies, however, is strongly criticized by the learned Professor W. Tetley.⁹⁹ He argues that the on-deck shipment in that case was a fundamental breach of the contract because the liberty clause would be valid only if it was accompanied by a statement on the face of the bill of lading that the goods are carried on deck. He considers a general liberty clause merely as an option that can be exercised by the carrier only when there is a statement of deck carriage in the bill of lading.¹⁰⁰ Another reason, pointed out by W. Tetley as an irrefutable argument, for disagreeing with the Svenska Traktor v Maritime Agencies decision, is that it ran against the principle that the typewritten wording on the face of the bill of lading (in this case, the absence of a statement) has precedence over the printed clauses (in this case, the general liberty clause at line 76).¹⁰¹ While the first argument is logic and difficult to disagree with, had it not been for the recent developments on fundamental breach,¹⁰² Tetley’s second argument seems to be not that plausible and based on a weak foundation. In the opinion of the author of this work, it is inaccurate to assume that the absence of a specific typewritten wording (i.e., a lack of a statement to carry goods on deck) can be used to demonstrate that there is actually a typewritten wording (equivalent to a statement to carry goods below deck) that goes contrary to the printed clauses in the bill of lading. In other words, Tetley’s argument that a clean bill of lading qualifies as a statement that the goods will be carried below deck can be challenged on the basis that a clean bill of lading evidences no more than the implied duty of the carrier to stow below deck. Certainly, a clean bill of lading requires the carrier, in the absence of other contractual provisions, to stow below deck, but it will be dubious to consider it a statement that could contradict and supersede the printed clauses in the bill of lading.

Furthermore, invalidating the nonresponsibility part of the clause (being repugnant to Article III rule 2 and rule 8), while at the same time allowing the liberty part of the clause (being not contrary to the Rules), seems to be justified in the particular case by virtue of the provision that incorporates the Rules (as enacted in COGSA 1924) into the bill of lading contract in the Svenska Traktor v Maritime Agencies case. The clause, invoking the Rules, reads: “If, or to the extent that, any terms (sic) of this bill of lading is repugnant to or inconsistent with anything of such Act or Schedule, it shall be void” [emphasis added].

After having addressed these main points of criticism, it is important to say that the Svenska Traktor v Maritime Agencies cannot be regarded as an erroneous decision also in the light of a subsequent case—The “Antares” (1987), where unauthorized deck cargo was damaged during the journey, but the fundamental breach argument of the cargo interests was conclusively denied.¹⁰³

There are examples of other unusual clauses inserted by carriers in their bills of lading in an attempt to exclude their liability, as well as ingenious legal devices that aim at compelling the shipper to assume the risk of damage resulting from on-deck carriage of the goods. This was the case in Encyclopedia Britannica v The Hong Kong Producer,¹⁰⁴ where containerized cargo was received on board in apparent good order and condition, and it was stowed on deck under a “short form” bill of lading, which did not make any mention, notice, or statement of deck carriage. However, this short form referred to the carrier’s “regular form” bill of lading and expressly incorporated all of its terms.¹⁰⁵ The shipper Encyclopedia Britannica was unaware that most of the cargo was stowed on deck. Nor did it know of the regular bill of lading, which contained, among others, clause 13:

13. Stowage On Deck, etc. […]

The shipper represents that the goods covered by this bill of lading need not be stowed under deck and it is agreed that it is proper to and they may be stowed on deck unless the shipper informs the carrier in writing before delivery of the goods to the carrier that under deck stowage is required.

With respect to goods carried on deck, all risk of loss or damage by peril inherent in or to incidental [sic] such carriage shall be borne by the shipper…

The carrier relied in his defense on that clause and contended that it allowed him to stow the goods on deck and, therefore, he was not in breach of contract and not liable for the damage to the cargo. However, the shipper received only the short form bill of lading, and no copy of the regular form was physically attached or issued together with it. Moreover, the short form was issued only after the cargo was already stowed on deck, and thus the shipper had no opportunity to inform the carrier “in writing before delivery of the goods” that cargo should be stowed below deck as required by clause 13. In effect, the clause assumed the features of an instrument that tacitly compelled an unaware shipper to unwillingly waive his right to have his goods stowed under deck and, thus, to waive virtually all his rights under the Hague Rules (in this case, the US COGSA) because, as shown so far, declared deck stowage is excepted from the Rules. The Clause Paramount inserted in the short form bill of lading also operated to that effect through the words “so far as they [the Rules] may be applicable,” which suggested that should deck carriage took place, the shipment would not be governed by the statutory liability regime. To summarize, the clause lessened the carrier’s liability and at the same time deprived the shipper of all the protection to which he was entitled under the Rules. The Court in that case ruled that clause 13 was not an express agreement to stow on deck as the short form bill of lading did not indicate anything suggesting that the cargo would be stowed on deck. Therefore, the shipper was afforded with the statutory protection of the Rules (in this case, the US COGSA), whereas the carrier was held to have issued a clean bill of lading, and, by stowing the cargo on deck, he was in breach of the contract of carriage and was found liable.

In conclusion, it suffices to say that stowing cargo on deck under a “liberty to stow on deck” clause will nowadays not be a breach of the contract. What is more, the carrier is under no duty to inform the shipper that the liberty has been exercised unless this is specified in the contract.¹⁰⁶ However, when a bill of lading gives the carrier only an option to carry the goods on deck but there is no on-deck statement on the face of the bill, the Hague or Hague-Visby Rules will still apply, and the carrier will be under the obligation to “properly and carefully” load, stow, and carry the goods, which will not be considered “deck cargo” within the meaning of Article I(c) of the Rules. This means that, by agreeing to the “liberty to stow on deck” clause, the shipper agrees with assuming the typical risks that relate to the carriage of cargo on deck but does not agree with and is thus protected from negligence on behalf of the crew or from the vessel becoming uncargoworthy or unseaworthy because of the deck cargo.

What is more, similarly to the position when there is a custom to carry goods on deck (Sect. 4.4.2), a carrier cannot rely on a liberty clause inserted in the bill of lading in order to protect itself from claims for loss of or damage to deck cargo if deck carriage is done in breach of a preexisting express contractual agreement to carry on deck. This could be the case where the parties stipulated in a charter party that the goods will be carried under deck but the carrier subsequently issues a claused bill of lading that provides the liberty to stow on deck.

On the other hand, unilateral declarations that take the form of clauses, which are disguised in another form of the transport document and kept away from the knowledge of the other party, do not constitute an agreement between the carrier and the shipper to stow goods on deck. In order to have a valid agreement for on-deck stowage, an informed consent on behalf of the shipper must be present. A weighty factor that courts take into account when establishing the level of knowledge of the shipper is whether there have been any past dealings between the two parties.¹⁰⁷ What matters most, however, is the approach adopted in both cases Svenska Traktor v Maritime Agencies and The “Hong Kong Producer,” which requires strict compliance with the two conditions set forth in Article I(c)—the factual and also the contractual one.¹⁰⁸ Thus, the notation or statement on the face of the bill of lading must clearly state that the cargo “will” or “shall” be carried on deck and not that it “may” be carried on deck.¹⁰⁹ The latter notation will provide the carrier with discretion as to the mode of carriage, but from the perspective of the shipper, the consignee, or the receiver, this is not sufficient information regarding the way of carriage. No consignee will know for certain whether the cargo will be carried below or above deck if it is stated on the B/L that the carrier “may” carry it on deck.

Another important point is that clauses that allow a serious deviation from standard bill of lading provisions, such as the clause in The “Hong Kong Producer,” are subject to the contra proferentem rule.¹¹⁰ This means that a term that is not a standard term in the bill of lading but was drafted by the carrier should be construed narrowly and against him.

4.5 The Evolving Views on Deck Cargo Under English Law: Toward a Less Restrictive Regime

4.5.1 The Traditional Deck Cargo Doctrine: The Implied Duty of the Carrier to Carry the Goods Under Deck

Historically, the prohibition of loading and carrying cargo on deck dates back to early times. The Statute of Marseille (Statuts Municipaux de Marseille) from the year of 1253 decreed on-deck carriage unlawful, regardless of whether or not it had been agreed beforehand by the parties.¹¹¹ Later on, in the fifteenth century, the Hanseatic League and the Italian City-State of Genoa also declared stowage on deck an improper practice in their laws.¹¹²

Since those early times, there has been a general rule that cargo should be carried below deck—either in the holds or in other usual carrying places—regardless of whether a bill of lading is issued.¹¹³ Although this rule is nowadays not codified, it can be assumed that this is a general principle of maritime law, which, evidently, is derived from a long-standing custom that was passed on from port to port and has been uniformly applied. As pointed out by the learned Prof. Dr. Eric Van Hooydonk, general principles of maritime law constitute an important part of lex maritima as a source of maritime law.¹¹⁴ While lex maritima is of little practical importance nowadays, it still exists as one of the sources of maritime law, together with the CMI and IMO conventions, the self-regulating character of maritime law, and also national legislation. To exemplify, Prof. Hooydonk lists some of the general principles of maritime law such as the freedom of navigation; the freedom of maritime contract (being subject to express mandatory rules); the fundamental distinguishing characteristics of a ship; the application of the law of the flag to the property law status of the ship; the general duty of care of maritime contracting parties; the essential characteristics of charter parties, the bill of lading, and the sea waybill; the authority, powers, and responsibility of the master of the ship; the humanitarian treatment of crew and stowaways; the principle of general average; the principle of “no cure no pay” in salvage law; and the duty to care for the environment.¹¹⁵ These general principles are universally accepted and have a binding force in both contractual usage and practice.¹¹⁶ The principle of under-deck carriage meets both of these requirements. Therefore, it follows that, according to the old doctrine on deck cargo, the carrier is always under the implied duty to stow the cargo below deck; this is its basic obligation.

This rule, however, is subject to two exceptions. The carrier is authorized to stow goods on deck only when (1) there is an express agreement between the parties to the contract of carriage to that effect or (2) there is a universal custom that is binding within a particular trade, or port of loading, to carry the goods on deck.¹¹⁷

This general rule to stow below deck, subject to an express agreement or a universal custom, has materialized in the pre-Hague Rules case law. In the old case of Royal Exchange Shipping v Dixon (1886),¹¹⁸ the House of Lords ruled that there was an implied term inherent in any contract of carriage that the carrier should stow the goods below deck even if this was not manifested in the contract. According to that judgment, unless there is a legal requirement to stow on deck, an express agreement between the parties to do so, or a custom or practice to that effect, the only authorized location to stow the goods is below deck. The case involved the carriage of 125 bales of cotton under four bills of lading. While three of the bills of lading stipulated that goods will be carried under deck, the fourth bill was silent on that matter. The House of Lords held not only that the under-deck term would be implied to the fourth bill of lading but that it would have been implied on all four bills had they all been silent with regard to the manner of stowage.

4.5.1.1 An Agreement Between the Parties as an Exception to the Duty to Carry Under Deck

In order to override the general principle of below-deck carriage, the carrier has to fulfill the onerous burden of proving that there is an express agreement with the shipper that the goods will be carried on deck. Even when on-deck carriage is stated on the face of the bill of lading, that statement may not be held to express the true consent of the shipper to such an arrangement. The express agreement must not only be stated on the face of the bill of lading, but it must also be tantamount to a genuine and informed consent, clearly expressed by the shipper prior to sailing.¹¹⁹ The reason why only a clear on-deck provision in the bill of lading is considered an express agreement is that such a clause provides certainty to the parties and allows them to assess their risk and responsibility over the cargo.

A clean bill of lading issued by the master certainly precludes the carrier from proving that there has been an agreement between the parties to carry the cargo on deck.¹²⁰ Even adducing any extrinsic evidence or oral testimony, in order to substantiate an on-deck agreement, will be futile and of no avail because of the basic principle that a clean bill of lading is an express agreement itself that the goods shall be carried below deck.¹²¹ This implies that a clean, or unclaused, bill of lading refers not only to the condition of the goods but also to the location where they are to be stowed—under deck.

Exceptionally, in certain very unusual circumstances, an oral promise of assurance to carry the goods below deck can be an enforceable contractual promise.¹²² The promise in Evans v Merzario was held binding against the specific background of the case—an assurance of below-deck carriage was given to the cargo owners because, based on past dealings between the parties, this was the only condition upon which the cargo owners would have agreed to the carriage.¹²³ Here, the defendant was not the carrier but the freight forwarding company. The promise was used by the forwarding agent to induce the cargo owners to continue doing business together on the same terms, notwithstanding that the cargo of machines was now to be transported in containers instead of, as it had been previously, in crates on trailers.

Although considered a binding obligation, the oral agreement did not constitute a collateral contract varying the terms of the written contract, but it was “a new express term which was to be included thereafter in the contracts between the plaintiffs and the defendants.”¹²⁴ Thus, the oral promise was interpreted as a legally binding new term, which was added to the standard printed conditions of the contract, and which the freight forwarders breached by accepting on-deck master bills of lading.

However, when a carrier fails to prove an agreement with the cargo owners for on-deck carriage, and even when a clean bill of lading is issued, the carrier is still permitted to prove an existing accepted custom to carry goods on deck within a specific trade (see Sect. 4.4.2). This is also what the freight forwarders in Evans v Merzario attempted to establish, although unsuccessfully—a customary practice to stow on deck in the then new container trade, which would have rendered the law on deck cargo inapplicable to the particular shipment.¹²⁵

4.5.1.2 A Universal Custom Within a Particular Trade to Carry the Goods on Deck

The second exception to the under-deck rule is a pre-Hague Rules principle and is of little importance nowadays. It allows deck carriage in cases when there is a generally recognized custom within a particular trade that the goods may be stowed on deck. This means that, for certain goods, and provided that such a universal custom is present, the bill of lading does not have to state that the cargo will actually be carried on deck.

In Royal Exchange Shipping v Dixon, the owners of the screw steamer the Egyptian Monarch, carrying some of her cargo on deck from New Orleans to Liverpool, attempted to prove a custom to stow on deck. They relied on the practice of vessel owners that were trading between these two ports and that shipped goods on deck in violation of their contract of carriage, while accepting full responsibility for the consequences. However, the Honourable Law Lords held that, since the shipowners agreed to pay any damages resulting from this extensive practice established in Liverpool, the practice was actually tantamount to nothing more than a habit of stowing goods on deck in breach of the contract with the shipper and, thereafter, of paying for that breach.¹²⁶ Moreover, even if the cargo interests had been aware of that practice of deck shipment and had not objected to it, they would not have been regarded as having consented to a deck-carriage modification of their bills of lading contract, for “their non-interference merely implies that they do not think it necessary to prevent a deviation from the contract, because they are satisfied of the shipowner’s ability to make good all loss arising from his having broken it.”¹²⁷

To constitute a custom within a trade to carry cargo on deck, there must be something more than a frequent deck carriage. In Royal Exchange Shipping v Dixon, it was noted that to establish such a custom, the evidence on the case must indicate a practice or usage that is general and universal within a certain trade and at the port of shipment, and which is known by anyone who is involved in this particular trade:

It is suggested that there is a practice which it must be taken that they knew. Now the only practice which it can be taken in law that they impliedly knew (that is, taken that they knew, although they did not) is a general practice; so general and universal in the trade and at the port from which these goods were taken, that everybody who ships cotton on board a ship at New Orleans for England must be taken to know that his goods probably will, or may probably be put on deck. […] To say that there is a practice, or to say that there is a frequent practice, is only to say that it is sometimes done, leaving it open that as often, or oftener, it is not done. Such evidence as that is not evidence to go to a jury, upon which they would be justified in finding a general usage.¹²⁸

It can be concluded that, in order to be relied on a universal custom within a particular trade (a trade purpose or port customs), there must be established a general and universal practice so that the particular trade is considered “customary.” In this way, any cargo owner will be aware that its goods are likely to be stowed on deck.

However, relying on a universal custom to excuse on-deck carriage is a pre-Hague Rules principle, and it has little application nowadays. This is because the Rules are not silent on that matter but explicitly require in Article I(c) that the goods should be expressly stated on the bill of lading as carried on deck and also be so carried if parties want to exclude the application of the Rules in their contract. Therefore, under the Hague and Hague-Visby Rules, the carrier cannot excuse himself for deck carriage, relying on this old principle.¹²⁹

Under charter parties, however, it is deemed permissible to load cargo on deck where the vessel is specially designed for such carriage.¹³⁰ In certain cases, deck carriage is justified because of technological innovation and vessel design—e.g., purpose-built container vessels or other vessels designed for carriage on deck. For example, if a semi-submersible vessel is carrying a platform, there will be no need to state anything in the bill of lading about the deck carriage. It is, of course, inconceivable to stow the platform in the ship’s holds.

4.5.1.3 Deck Carriage and the Doctrines of Fundamental Breach and Deviation

4.5.1.3.1 Fundamental Breach

The doctrine of fundamental breach provides that if a party has committed a breach that goes to the root of the contract, there exists a rule of law that deprives the party at fault of any of the clauses set forth in the contract that are intended to except or limit that party’s liability for his failure to perform. The doctrine has its commercial origin in the nineteenth century and was applied in cases of serious contractual breaches such as a geographical deviation from the voyage or storing the goods in a different warehouse to the one agreed for in the contract. In such cases, even causation was not necessary to trigger the application of the doctrine—the fact that loss or damage was not caused by the fundamental breach was not a defense for the carrier. This was a much-preferred and used rule of law in the past and up until the two milestone decisions House of Lords cases (Suisse Atlantique and Photo Production), which marked a cardinal change.¹³¹

Today, however, there has been a significant development in shipping law with respect to deck carriage and the doctrine of fundamental breach of the contract. This can be observed both in legal literature and in case law. To begin with, earlier editions of Scrutton on Charterparties and Bills of Lading contained a passage, rendering unauthorized deck carriage equal to a fundamental breach:

The effect of deck stowage not so authorized will be to set aside the exceptions of the charter or bill of lading, and to render the shipowner liable under his contract of carriage for damage happening to such goods.¹³²

This approach,¹³³ however, is now considered old law because the doctrine that a breach of the contract can be of such a fundamental nature as to discharge all exceptions clauses is no longer considered to exist after it was addressed and rejected in The “Antares.” ¹³⁴ In the vivid legal parlance of Lord Justice Lloyd, the death knell of the fundamental breach doctrine sounded in the Suisse Atlantique case,¹³⁵ while its corpse was buried in Photo Production v Securicor.¹³⁶

In the former case, it was established that the freedom of contract would be excessively restricted if there was a rule of law, which supported the prohibition and nullification of contractual defenses in case of a fundamental breach.¹³⁷ The Court suggested that the terms and scope of the exception clause should be considered on a case-by-case basis and that the contract of carriage should be construed as a whole before establishing whether or not the exemption clauses were admissible to protect the carrier in the circumstances of a fundamental breach.¹³⁸

The House of Lords in Photo Production v Securicor confirmed this proposition, namely that it is a matter of construction of the contract when it comes to whether and to what extent limitation and exclusion clauses are to be applied to a case of fundamental breach or breach of a fundamental term.¹³⁹ Lord Wilberforce expressed his opinion that, regardless of the complexity of the case and of the contractual breach, the normal rules of contract law have plenty of resources to deal with these problems; hence, there was no need for a specific rule of law to be judicially devised and applied to cases of fundamental breach.¹⁴⁰ Thus, Photo Production v Securicor explicitly rejected the fundamental breach doctrine by preferring the “rule of construction” approach.

The judgment in The “Antares” relied on these two cases and disapproved the rule related to deck cargo as set out in the earlier editions of Scrutton on Charterparties and Bills of Lading. The Court found no reasons to regard unauthorized deck stowage as a special case that is tantamount to a fundamental breach. Accordingly, this led to a change of the relevant passage in Scrutton, so that later editions now represent the current law on deck carriage. Considering the developments stated in the cases hereinabove, the new passage has been considerably amended, and it formulates the legal effects of unauthorized deck carriage as follows:

The effect of deck stowage not so authorized is to render the shipowner liable under his contract of carriage for damage happening to such goods caused by such stowage. Whether exceptions […] apply to protect the shipowner is now a matter of construction…¹⁴¹

It is explicitly affirmed that there is no rule of law that renders carriage on deck a fundamental breach, depriving the carrier from all exceptions and limitation clauses.¹⁴²

The approach based on the “rule of construction” indeed does not nullify the carrier’s defenses, but it does not automatically uphold them either. If exception clauses are devised to protect the carrier, provided that it honoured its obligation under the contract to carry below deck, then these clauses will not be available to it if it is in breach of these obligations and the wording of that clause does not cover such a breach.¹⁴³ Conversely, if the clauses are envisaged to encompass cases when the contract has been breached by wrongfully stowing the goods above deck, then the clauses will be upheld. Expressed in The “Chanda,” this rule is based on contractual intention, and it has been applied and preferred over the fundamental breach doctrine in several pivotal cases related to deck carriage such as Royal Exchange Shipping v Dixon, Evans v Merzario, The “Antares,” and The “Chanda” itself.¹⁴⁴ However, the rule actually does no more than stating the obvious, and it fails on providing any guidance as to which exemption and limitation clauses are devised to protect the carrier in cases of wrongful on-deck carriage and which are not. Nevertheless, for the purpose of the current section, the merits of this assertion are that it confirms the death of the fundamental breach doctrine and upholds the application of the rule of construction in cases of unauthorized carriage on deck. As to the defenses that are available to a carrier that breached its obligation to carry below deck, these are discussed in Sect. 4.5.4 below.

There is another argument for considering unauthorized deck carriage not a fundamental breach. And this argument is found at the beginning of Article III rule 2 of the Hague/Hague-Visby Rules, which is invariably in the focus of the current work. The article, which sets forth the cargo-related obligations of the carrier, begins with the following proviso: subject to the provisions of Article IV. So, on the one hand, we have undeclared, i.e. unauthorized, deck carriage (that is, when there is no express agreement to stow on deck), which is considered to constitute a breach of Article III rule 2, and on the other hand we have the duties stated therein (to “properly and carefully load … stow, carry … care for … the goods carried”) to be subject to the exemptions and defenses in Article IV. Therefore, unauthorized deck cargo cannot be considered a fundamental breach of the contract, but an only a breach in respect of which the carrier can escape from liability by means of resorting to the defenses provided in the Rules. The extent to which a carrier can escape liability depends, of course, on the specific circumstances and factual matrix of the case, as well as on the rules of construction employed by the Court.

4.5.1.3.2 Deviation

The doctrine of deviation originates from marine insurance law, where a vessel was deprived of her insurance cover if the shipowner geographically departed from the commercial route or unduly delayed the journey.¹⁴⁵ This was so because the insurers were not willing to cover risks that lie outside the prompt execution of the journey on the usual commercial route. The doctrine of deviation is a variation of the same doctrine on fundamental breach.¹⁴⁶ With regard to the application of the doctrine from a practical perspective, shippers often utilize it in an effort to avoid statutory liability limitations such as the per package limitation in Article IV rule 5 of the Hague-Visby Rules.

In America, the doctrine of deviation has expanded from a geographical concept to embrace also fundamental contractual aberrations.¹⁴⁷ Thus, on-deck carriage under a bill of lading that does not expressly state that the cargo will be loaded on deck is considered a technical rather than a geographical deviation.¹⁴⁸ A technical deviation, also known as a quasi-deviation, indicates any variation in the conduct of the vessel, which increases the risk over the goods carried.¹⁴⁹ The consequences of a deviation are, in general, that a carrier cannot rely on the defenses laid down in the bill of lading or in the Hague Rules and Hague-Visby Rules, except when the deviation was reasonable (Article IV rule 4), which is deemed to be a question of fact. A quasi-deviation has the same results as the geographical deviation because, under American law, the former is considered a fundamental breach, meaning that in case of unauthorized deck carriage, the carrier is deprived of all of its benefits, defenses, limitations, and exclusions under the bill of lading.¹⁵⁰ Likewise, the carrier is deprived of many of its rights under the US COGSA, such as the limitation of liability (Section 1304(5)) and the carrier-friendly presumption laid down in Section 1303(6), except, however, for the one-year time limit.¹⁵¹ This was the case in American Dornier Machinery Corp and Anr v “MSC Gina” and Ors ¹⁵² before the US District Court, where the carriage of containers full with delicate and sophisticated equipment on the deck of a specially designed containership was held to be a deviation because of a previous express agreement between the shipper and the carrier that, unless the cargo was stowed below deck, the shipper would be a priori informed for the impossibility of under-deck stowage, and the latter could choose to allow the shipment on deck, reschedule the shipment for another vessel, or cancel the booking and make an arrangement with another carrier without any penalty. Thus, the agreement did not provide the carriers with the liberty to stow on deck at their option, but they had to communicate this with the shippers. This special agreement for under-deck stowage formed part of the contract of carriage, and by breaching it, the carriers MSC breached a contractual term that goes to the root of the contract, which deprived them of all the defenses under US COGSA, including the package limitation defense of $500 per package. However, the court allowed that the carriage of containers on the deck of specially designed containership under a clean bill of lading was not considered an unreasonable deviation, pointing to previous cases,¹⁵³ but in the present case such carriage was coupled with a special stowage agreement, which was part of the contract of carriage.

The question of whether on-deck carriage of containers on specially designed container vessels amounted to an unreasonable deviation was discussed and decided in the earlier American case The “Mormacvega.” ¹⁵⁴ Two shipping containers with pallets of liquid “Teflon” were carried on deck from New York to Rotterdam under a clean bill of lading, absent a contractual provision or established custom to carry on deck. One of the containers was lost during the voyage. The first instance court held that given the fact that the Mormacvega was originally a general cargo ship but then converted into a combined vessel capable of carrying break bulk and containers, on-deck stowage was permitted. These substantial structural changes led the Court to believe that the “[c]ontainers on the deck of the Mormacvega were not necessarily subject to greater risks than those stowed under deck.”¹⁵⁵ Thus, the Court made an exception to the per se doctrine on unreasonable deviation for containerized vessel. The factual inquiry performed by the Court in this case also shows how important the ship design is in determining the risk that pertains to the carriage of cargo on deck.¹⁵⁶ Furthermore, the Court of Appeal agreed with and affirmed the decision of the District Court, which was based, inter alia, on the following points: there was no oral agreement to require the carrier to stow below deck, the deck of a container vessel was exactly where shipping containers are reasonably to be carried, the vessel was specifically constructed to safely permit on-deck carriage of containers.¹⁵⁷

Under English law, the application of the doctrine of deviation is considered highly uncertain, and it is submitted that the doctrine’s scope is narrower, meaning that less events may be characterized as deviation under English law as compared to American law.¹⁵⁸ Earlier English cases generally considered deviation as a breach, which goes to the root of the contract, and as such it made the carrier unable to rely on its limitation or exclusion clauses. A propos, some English authors also described undeclared deck carriage as akin to deviation.¹⁵⁹ However, early English cases are nowadays not considered to have established grounds for a rule of law that embodies the principle employed in those cases.¹⁶⁰ Thus, deviation is not considered a special case, but it rather obeys the ordinary principles of contract law.¹⁶¹ What is more, there is nowadays no English authority that considers the wrongful carriage on deck as a deviation.¹⁶² Also, the carriage on deck was not held to be equivalent to an automatic case of res ipsa loquitur.¹⁶³ The mere fact that goods are stowed on the weather deck does not mean in and of itself that the contract or the Rules have been breached. There must be a causal connection between the deck stowage and the damage or loss of such goods.¹⁶⁴

With regard to other jurisdictions, the deviation principle does not apply in relation to deck cargo in the Netherlands, France, or Italy, where courts have decided that the carrier can rely on Article IV rule 5 to limit his liability in deck cargo cases.¹⁶⁵

4.5.2 Interpreting the Bill of Lading

Before rushing into the question of how courts interpret the various bills of lading provisions, as well as of how far carriers may go to exclude their obligation to stow below deck or to limit or except their liability for unauthorized deck carriage, consideration must be given to a wider observation. In the following sections, one peculiarity will transpire about the legal consequences of deck carriage, and it is that the central problem in disputes involving cargo carried on deck is actually related to what the carrier has agreed to rather than to what it has actually done. As stated by the Honourable Madam Levine J, the main goal of a commercial contract is to allocate among the parties the risks pertaining to the transaction, and, where the contract is insufficiently clear, it is up to the courts to establish who will bear the losses.¹⁶⁶ It is very important to identify what the parties have agreed to because these contractual arrangements (in this case, the location where the goods will be stowed) create different obligations for the parties.

The main issues related to the carrier’s implied obligation to stow the goods below deck are actually to be found in the bill of lading and its content. The transport document may contain provisions related to deck carriage, on the basis of which bills can be provisionally summarized into four categories: firstly, the bill of lading may expressly prohibit the carriage of goods on deck; secondly, it may allow carriage on deck by expressly stating that the cargo will be carried so; thirdly, it may only give an option, or a liberty, to the carrier to stow the goods on deck; lastly, the bill of lading may not address the matter of deck carriage at all, meaning that the master has issued a clean/unclaused bill of lading.

4.5.2.1 Issuing a Clean Bill of Lading

It was already outlined that there is a general principle prescribing that a clean bill of lading requires that the goods shall be carried below deck. Although nothing in the Rules specifically stipulates so, this basic principle existed well before the Hague and the Hague-Visby Rules, as discussed in Sect. 4.5.1 above, and it stems from the implied duty of the carrier to carry the goods under deck. Hence, whenever the contract of carriage is silent on where the goods shall be stowed, and provided that there is no agreement, custom, or a statutory obligation to stow on deck, it is generally understood that the actual place of carriage will be below the weather deck of the vessel.

The lack of a provision in the Hague-Visby Rules that explicitly stipulates the aforementioned requirement does not preclude one to infer that the Rules, too, postulate under-deck stowage when clean bill of lading is issued. This assumption can be made by reading together the Hague-Visby’s Article III rule 2, which obliges the carrier to stow the goods “properly and carefully,” and the basic principle of below-deck stowage, which has for a long time been recognized as the proper way of stowing the goods.

It should be noted in that regard that, while this section of the chapter focuses on the part of the bill of lading that addresses where cargo will be carried, in practice most bills of lading are actually silent as to the location of the goods. The reason why bills of lading usually do not expressly state whether the goods will be carried below deck or on deck is a commercial one. If the transport document is qualified with a statement for on-deck carriage, this may be problematic for the underlying contract of sale, in particular where the latter provides for a transaction effected through a documentary credit, which is known also as a Letter of Credit.¹⁶⁷ Sellers and buyers of goods very often resort to this type of a credit payment arrangement because, by using a Letter of Credit, the risk of nonpayment falls on the issuing bank and not on the seller, whereas the buyer, on the other hand, is satisfied that the seller will be paid only if all terms and conditions in the Letter of Credit are met. Because the risk of nonpayment falls upon them, banks are unwilling to accept claused bills of lading, stating that cargo will be carried on deck and, thus, jeopardizing the transaction.

4.5.2.2 Issuing a Claused Bill of Lading

The strict approach applied in Svenska Traktor v Maritime Agencies and The “Hong Kong Producer” to liberty clauses and to ambiguous clauses in bills of lading, which lack an express on-deck statement, has been elaborated and expanded in The “Rhone,” where there was actually an on-deck notation on the bill of lading.¹⁶⁸ The case concerned the carriage of 1725 packages of lumber from Canada to Belgium subject to the Hague-Visby Rules. Roughly half of the packages were consigned to receiver A while the other half to receiver B. The lumber within the packages had differing measurements and differing prices. Each of the two consignments was on a separate bill of lading, but both bills contained the notation “Stowage: 86% OD [on deck] 14% UD [under deck],” which reproduced the notation on the mate’s receipt and referred to the entire shipment. The bills contained exclusion clauses as well, stating that cargo carried on deck was at the risk of the cargo owners, and the carrier was not to be held liable for loss or damage. The cargo in its entirety was loaded and carried both below and above deck, in accordance with the proportions laid down in the bills of lading. During the voyage, more than half of the shipped lumber was damaged, and it was later discovered that all of the damaged lumber was among the packages that were carried on deck. Some of the damaged packages were consigned to purchaser A while others to purchaser B. The main question that appeared before the Canadian Court was whether the packages stowed on deck could be considered “goods” and thus covered by the Hague-Visby Rules or whether they were “deck cargo” within the meaning of Article I(c) and thus exempted from the Rules, which would enable the carrier to rely on the liability exclusion clauses.

Both the first instance court and the Court of Appeal were unanimous that the on-deck notation on the bills of lading was not clear as to exactly which part of the cargo was carried on deck and which was not. The information on the bill of lading was in percentages and was precise with regard to volume, but it was not certain with respect to value of the cargo. Such uncertainty in the notation was held to be equivalent to the absence of a notation in Svenska Traktor v Maritime Agencies, and therefore the same principles applied to the present case.¹⁶⁹ In particular, the problem in The “Rhone” was that the notation on the bills of lading referred to the entire shipment of lumber, and it could not be relied on with respect to each consignment, because the specific packages that were to be carried below and above deck could not be identified at the time when the contract was concluded. Thus, consignees could not determine the value of the cargo that was carried on deck and could not assess the respective risks that were involved in the particular bill of lading contract.

Therefore, the Court held that no part of the shipment could be considered “deck cargo” within the meaning of the Rules. The notation was not sufficient to exclude the goods carried on deck from the application of the Hague-Visby Rules in accordance with Article I(c), and as a result the carrier could not rely on the liability exclusion clauses in the bills of lading. This case illustrates how important the aforementioned factors¹⁷⁰ are and how they come into play when courts are evaluating whether a particular shipment qualifies for “deck cargo” within the meaning of the Hague-Visby Rules. Here, the Court put great emphasis on the communication between the parties regarding the intended deck carriage, which was not sufficient to allow the cargo owners to evaluate the risks and to make an informed decision. Thus, since the carrier failed to properly communicate the risks pertaining to that shipment, the Court found the carriage objectionable and not conforming to the requirements of the Hague-Visby Rules for “deck cargo.”

Several other implications could be drawn from that ruling. First of all, the on-deck notation or statement should be reliable for the respective shipment covered by the bill of lading, and it should be clear and certain. The “Rhone” proves that even when there is a notation on the bills of lading that states that the goods will be carried on deck, the results may still be the same as if there was no notation at all if that notation is uncertain as to exactly which cargo will be carried above deck. Parties must be able to calculate with certainty the distribution of the risk between the cargo interests and the carrier. What is more, the shipper and the consignee must be capable to calculate and assess their risks prospectively at the time of contracting and not retrospectively after the damage has already been caused.¹⁷¹

4.5.3 Deck Cargo and the Obligation to Care for the Goods (Article III Rule 2)

It has been established that stowage in an appropriate way may still be a breach of Article III rule 2 when it relates to cargo carried on deck even if there is an agreement that the cargo will be carried on deck absent an express statement to that effect on the bill of lading. As already pointed out, unauthorized deck carriage constitutes a breach of Article III rule 2 in and of itself, whereas carriage that has been agreed via a liberty clause to be performed on deck but absent a statement to that effect on the bill of lading is not automatically considered breach of Article III rule 2. However, that may well be the case if the obligations stated in that article have not been discharged “properly and carefully.”

In the abovementioned case Svenska Traktor v Maritime Agencies, the carrier shipped 50 tractors, 16 of which were stowed on deck the motor vessel Glory, and during the journey from Southampton to Stockholm one of the tractors was lost overboard in normal weather conditions. The judge established that the first part of the liberty clause in the bill of lading allowed the shipowners to stow the goods on deck subject, however, to their obligation under Article III rule 2 to properly and carefully load, handle, stow, carry, keep, and care for the goods. The evidence on that case proved that the tractor was lost as a result of poor stowage, and lack of reasonable care in lashing the cargo to the deck, indicating a breach of Article III rule 2, therefore.¹⁷²

Similarly, in the Canadian case The “Mahia,” ¹⁷³ the plaintiff shipowners sought to establish an agreement between them and the shipper to carry dangerous goods on the deck of their vessel, The Mahia. The case concerned the shipment of drums of sodium chlorate from Montreal, Canada, to Melbourne, Australia, where the drums, after an incident-free voyage, ignited upon discharge, and the explosion damaged the vessel and caused a loss of life. It is noteworthy that the respective Canadian regulation for the carriage of dangerous goods in ships allowed the carriage of such goods on or under deck. Clause 12 of the export through bills of lading also allowed deck carriage and incorporated the Water-Carriage of Goods Act (1936), notwithstanding Article I (e) of the Rules. The shipowners, furthermore, relied on the fact that the bills contained the notation “On deck at shipper’s risk” in order to prove that they were given instructions by the shipper to stow the drums with the hazardous cargo on deck.

Considering all evidence and testimony,¹⁷⁴ the Superior Court of Montreal held that the notation “On deck at shipper’s risk” alone was not enough evidence to prove that the plaintiff shipowners were instructed by the shipper to stow on deck, nor was it enough to establish an agreement to ship on deck. On the contrary, the reason for the explosion upon discharge was found to originate not from the on-deck carriage per se but from the failure of the shipowners to properly and carefully discharge their obligations under Article III rule 2. The master of the vessel was knowledgeable of the hazardous properties of sodium chlorate, in particular that it is soluble in water and as such should be packed in watertight containers if carried on deck, and yet it was easily noticeable that the lids of the sodium chloride drums stowed on The Mahia were not watertight.¹⁷⁵ Evidence also showed gross negligence and want of reasonable care during discharge operations, which was a direct cause of the accident. Consequently, the carrier was held in breach of his obligations to properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods. The fact that the carrier had previously shipped thousands of tons of this particular cargo suggested that he knew or ought to have known the properties of sodium chlorate, and therefore he could not rely on the defenses provided in Article IV. Although the Court does not elaborate, it may seem fair to conclude that had the carrier not been knowledgeable of the hazardous cargo’s properties, he may have been entitled to the defense set forth in Article IV rule 6 of the Rules.¹⁷⁶

4.5.4 The Carrier’s Defenses Against Claims for Damaged or Lost Deck Cargo

When a carrier fails to prove that it fulfilled its obligation to properly and carefully load, handle, stow, and carry the goods because of unauthorized deck carriage, it is confronted with the issue to what extent it can rely on the exemptions and limitations set forth either in the contract of carriage or in the applicable liability regime. In general, the protection that a carrier may rely on is dependent on the terms in the contract of carriage and also on how these terms are evidenced in the bills of lading. In the case of deck carriage, however, it is difficult to give a straightforward answer whether the carrier would be dismantled of some or all of its defenses if goods are carried “illegally” on deck. This is because, as pointed above, the concept of authorized/unauthorized deck cargo varies in various circumstances.

It is important to note at this point that one of the main accomplishments of the Hague/Hague-Visby Rules is to eliminate clauses that excessively exclude carrier’s liability or exonerate the carrier from negligence and, instead, to introduce a fault-based regime with statutory liability exceptions and limitations, which can balance the interests of carriers and shipper. But when deck cargo is involved, it is left to national courts to define whether deck carriage is legal or not. That is why the term authorized deck cargo actually remains ambiguous. As will be seen further below, depending on the interpretation of the Court, the increased risk that stems from stowage on deck may render the agreement to stow on deck not sufficiently well communicated and thus any exemption clauses null and void. Thus, a situation is created where courts in various jurisdictions protect to a different extent owners of cargo carried on deck, and no uniformity could be found at an international level.

Under English law, statutory defenses have generally been more warmly welcomed by courts, unlike contractual exceptions and limitations.¹⁷⁷ Furthermore, English courts do not consider unauthorized deck carriage as such a grave breach so as to deprive the carrier from all of the defenses available under the Rules. A carrier that breached its obligation to stow below deck can rely to a different degree on a defense clause, depending on whether it is a limitation or an exception clause. These general observations can be elaborated by examining the court rulings discussed below.

4.5.4.1 Contractual Defenses and Limitations

Does the breach of the carrier’s obligation to carry below deck deprive him from reliance upon limitations or exceptions? This was precisely the issue that stood before the Court of Appeals in the aforementioned case Encyclopedia Britannica v The Hong Kong Producer, where the carrier sought to rely on the contractual defenses, which he drafted himself.¹⁷⁸ The plaintiff’s encyclopaedias were carried in containers on the deck of the defendant’s steamship, The Hong Kong Producer, from New York to Tokyo, and upon arrival in Tokyo, it was found that the cargo suffered damage by seawater due to the heavy swells during the voyage. As discussed above,¹⁷⁹ the carrier failed to prove that there was an agreement to stow goods on deck. Part of the controversial on-deck clause will be quoted again:

13. Stowage On Deck, etc.

[…]

With respect to goods carried on deck, all risk of loss or damage by peril inherent in or to incidental [sic] such carriage shall be borne by the shipper and the carrier shall have the benefit of all and the same rights, immunities, exemptions, and limitations as provided for in [Art.] 4 of the Hague rules or the corresponding provision of any Act that may be applicable, excepting subdivisions (1), (2) (j), (2) (q), (3) and (4) thereof [emphasis added].

What the carrier actually sought to achieve by drafting this provision was actually not only to lessen his obligations and liabilities but also to contractually afford himself all rights, immunities, exceptions, and limitations under Article IV of the Hague Rules, excepting himself of the rules that place the burden of proof on the person claiming the benefit of that defense, i.e., the carrier.¹⁸⁰ Since stowage on deck in that case was considered an unreasonable deviation, the carrier was deprived of all the benefits of the bill of lading and also of all the immunities set forth in Article IV, including the per package limitation. Therefore, the carrier was held liable for the full amount of the damages, regardless of the fact that the package limitation is said in the Rules to apply “in any event.”

This judgment concurred with the milestone case Royal Exchange Shipping v Dixon (1886), which has a direct relevance to the issue of the carrier’s contractual defenses in the case of unauthorized carriage on deck.¹⁸¹ As mentioned supra, a cargo of cotton was shipped on deck of the vessel Egyptian Monarch, which ran aground during the voyage, and in order to get her free, the master properly jettisoned the deck cargo. All bills of lading contained, among others, “jettison” exceptions, and the shipowners relied on them, claiming that, under the bills of lading, they were not liable for the jettisoned cargo and also that the breach of contract in carrying on deck while under-deck carriage was contracted was not the proximate cause for the damage. The Court disagreed and ruled that the breach of the contract disentitled the shipowners to the jettison exception:

[T]his cotton was carried under a contract that it should be stowed under deck. The exception in the bills of lading of “jettison” cannot avail the shipowners, who broke their contract in stowing the cotton upon deck and thereby directly caused the loss to the merchants.¹⁸²

[…]

[A]t the time when jettison was made of those 125 bales, they were being carried in breach of the contract, and were not within the exceptions specified in the bills of lading, which have exclusive reference to goods safely stowed under hatches. In these circumstances I cannot doubt that the appellants are liable to pay to the respondents the value of the 125 bales, seeing that they cannot make delivery in terms of their contract, and have no legal excuse for their failure to deliver.¹⁸³

The quoted passage should not be, however, perceived as a general rule that the carrier’s contractual defenses are always void when cargo is wrongfully carried on deck. The particular exemption clause in Royal Exchange Shipping v Dixon was referred exclusively to goods carried under deck. Thus, the bills of lading did not prescribe any “jettison” defenses for the carrier in the circumstances of the case because the goods were carried above deck. In other words, the cargo was jettisoned in a way that fell outside the exemption clause. This clause, thus, fits perfectly within the prescription of Mr. Justice Hirst in The “Chanda” [1989], which was held nearly one century later, stating that “clauses which are clearly intended to protect the shipowner provided he honours his contractual obligation to stow goods under deck do not apply if he is in breach of that obligation.”¹⁸⁴ The “jettison” clause in Royal Exchange Shipping v Dixon (1886), on which Hirst, J., relied in his judgment in The “Chanda,” was indeed such a clause. Yet Mr. Justice Hirst did not provide any guidance or yardstick as to which limitation or exception clauses embraced in their scope unauthorized carriage on deck (i.e., being, thus, applicable) and which did not (i.e., being inapplicable, respectively). Instead, he erroneously assumed that all limitation and exception clauses had, in the circumstances of a wrongful on-deck carriage, a scope as the one mentioned hereinabove. This was one of the reasons why his judgment was later overruled and regarded as wrong.¹⁸⁵

Similarly, the Court of Appeal in Evans v Merzario held that the defendant forwarding agents were not entitled to rely on the exemptions contained in their printed conditions of carriage, which were standard for the forwarding trade. These exemptions contained in the trading conditions gave the forwarders, inter alia, the complete freedom in respect of means, route, and procedure in the transportation of the goods. However, there was an oral promise given by the forwarders to the cargo interests, which produced a binding obligation to carry the goods below deck, and the forwarders’ failure to ensure that its sister company at the port of loading would arrange for under-deck carriage was established to be the cause for the loss of the containerized cargo overboard. The Honourable Lords were unanimous that, since the damage resulted from a breach of the forwarders’ binding oral promise to carry the goods below deck, none of the exemption clauses in the printed conditions could protect the forwarding agents.¹⁸⁶ To state otherwise would mean that the new contractual term, embodied in the oral promise, would be “illusory” and “stillborn.”¹⁸⁷ It is noteworthy that the conclusion that the breach of the oral promise overrode any liability exemptions (including a weight limitation clause of £50 per ton) was reached through interpreting the contract as a whole and not on the basis of the fundamental breach doctrine.¹⁸⁸ Another remark is that none of the decisions cited above made a distinction between clauses that limited liability, on the one hand, and clauses that exempted from liability, on the other. Such differentiation is observed, however, in the defenses available to the carrier under the Hague and Hague-Visby Rules set forth in the next section below.

4.5.4.2 Defenses and Limitations Under the Hague and Hague-Visby Rules

4.5.4.2.1 The One-Year Time-Bar (Article III Rule 6)

The application of the one-year time limit contained in the Hague-Visby Rules was a central issue in The “Antares,” where unauthorized deck cargo was damaged during the voyage. On the facts of the case, machinery was shipped at Antwerp for carriage to Mombasa on the owner’s vessel, Antares, which was time chartered by the Mediterranean Shipping Company (MSC) on an NYPE form, which contained a demise clause. Upon discharge, it was discovered that cargo under one of the bills of lading was carried on deck, as a result of which it was seriously damaged. The bill of lading holders at first failed to identify the carrier correctly as they wrongly assumed that the charterers, MSC, with whom they contracted for the carriage, were the owners of the vessel. When the plaintiff bill of lading holders finally identified the vessel owners, their claim was time-barred by force of Article III rule 6. In order to defeat the one-year time-bar, the plaintiffs argued that the carrier had committed a fundamental breach of the contract by carrying the cargo on deck and, therefore, was not entitled to the defenses provided in the Hague-Visby Rules. The Court held that the carrier was not precluded from relying on the one-year time-bar because Article III rule 6 had general applicability, and the provision did not distinguish between fundamental and nonfundamental breaches, nor did it make any distinction between breaches that were equivalent to a deviation and breaches that were not.

Furthermore, Lord Justice Lloyd, giving the leading judgment, underlined that under the provision the carrier shall be discharged from all liability “whatsoever” and “in any event” provided that suit is not brought within one year and pointed to the fact that the wording of the Hague-Visby Rules’ Article III rule 6 is even wider than the old Article III rule 6 in the Hague Rules.¹⁸⁹ For the sake of clarity, this is illustrated in Table 4.1.

Table 4.1 The evolution of Article III rule 6

In Scrutton,¹⁹⁰ this amendment brought by the Visby Protocol is said to have the effect of applying the one-year time-bar not only in cases of deviation but also even in cases where there was intentional or reckless misconduct on behalf of the carrier within the meaning of Article IV rule 5(e).¹⁹¹ The bottom line is that the one-year time limit will be valid in extreme circumstances, such as a deviation, a fundamental breach of the contract, or an intentional and reckless misconduct, and there is no reason to assume that courts will not apply it to a case of an unauthorized carriage of goods on deck.

As Lord Justice Judge points out in another case, the one-year time limitation set forth in Article III rule 6 does not, in the strictest sense, exclude liability.¹⁹² It merely sets a contractual period that serves as a time-bar for the shipper’s right to claim so that after this agreed period has expired, any liability against the carrier and the ship shall be discharged. This is the main reason why courts do not apply such a restrictive reasoning regarding the application of that provision. This is not the case, however, with the carrier’s defenses set forth in the following two sections.

4.5.4.2.2 The Package Limitation (Article IV rule 5)

In cases of unauthorized deck carriage, the application of the package limitation (Article IV rule 5) is considered in accordance with different standards compared to the application of the one-year time-bar (Article III rule 6). Whereas the judgment in The “Antares” on the validity of the time-bar has not been challenged, there are conflicting views in English case law with respect to whether a carrier can avail itself of the package limitation defenses in the Hague and Hague-Visby Rules. These two defenses that are available to the carrier were considered to be of a different nature with regard to their application to an unauthorized carriage on deck. First, the one-year time-bar does not affect the quantum of the limitations, and, second, if the package limitation is upheld in circumstances where the carrier has dramatically and wrongfully shifted the risk by stowing the goods on deck, the application of this defense would undermine the purpose of the carrier’s obligation to stow below deck.¹⁹³

In The “Nea Tyhi,” Sheen J applied the Hague Rules’ package limitation provision to a contract of carriage contained in a bill of lading, incorporating the Rules and being claused “shipped under deck,” where the carrier nevertheless stowed and carried the goods above deck of the bulk carrier Nea Tyhi.¹⁹⁴ As a result, the plywood cargo, which is generally “very liable to deteriorate if allowed to get damp [and] should never be shipped on deck,”¹⁹⁵ was damaged by rainwater. Accordingly, the defendant’s liability was limited under Article IV rule 5 of the Hague Rules from £15,280—being what was initially claimed from the plaintiffs—to £14,000—being £100 per package for each of the 140 crates of plywood.

However, the Court in The “Chanda” reached quite the opposite decision and considered the package limitation “repugnant to and inconsistent with the obligation to stow below deck,” and as such it was held inapplicable.¹⁹⁶ This case was peculiar with the fact that the damage to the goods was found to be a result of a combination of several elements: (1) on-deck stowage, which caused waves hitting the cargo; (2) the positioning of the cargo on deck—it was stowed above hatch No. 1, which was the hatch nearest to the bow, where the “g” forces caused by the movement of the vessel were the greatest; (3) inadequate lashing, which was a contributory cause, as a result of which the cargo started shifting and hitting other cargos. The cargo consisted of a delicate equipment, which should have been below deck and as near as possible to the tipping center of the vessel, which was under hatch No. 4, in order to prevent as much as possible any movement of the goods. Instead, the cargo was stowed and positioned in the worst possible way, in a location where it was subjected to maximum exposure to the violent sea and the harsh weather conditions. Hence, Mr. Justice Hirst held the defendant shipowners responsible on two separate grounds: firstly, stowing the cargo on deck and positioning it on the forward hatch and, secondly, inadequate lashing.¹⁹⁷

Although the judgment in The “Chanda” was subsequently criticized¹⁹⁸ and deemed as wrong, it was followed in the New Zealand case The “Pembroke.” ¹⁹⁹ The High Court of New Zealand endorsed Mr. Justice Hirst’s view on package limitation, applied in The “Chanda,” that “clauses which are clearly intended to protect the shipowner provided he honours his contractual obligation to stow goods under deck do not apply if he is in breach of that obligation [and] the package limitation clause falls fairly and squarely within this category.”²⁰⁰ Although the Court in The “Pembroke” struck the application of the package limitation, it did not provide any independent reasoning but relied entirely on the disputed The “Chanda.”

The definitive verdict on the application of the package limitation under an unauthorized deck carriage was given in The “Kapitan Petko Voivoda,” ²⁰¹ which represents the current law. The owners and the charterers of the Bulgarian vessel Kapitan Petko Voivoda were sued for the partial damage and loss of cargo, which was wrongfully stowed on deck. The cargo owners contracted for the carriage of 34 excavators from Korea to Turkey. The contract of carriage was evidenced by six CONLINE bills of lading, which contained a General Paramount Clause, incorporating the Hague Rules as enacted in Turkey, and none of the bills stated that the excavators would be stowed on deck. The contract was also partly evidenced by a fax, which provided that the carriage would be only under deck. The carrier stowed and lashed the goods accordingly and proceeded with the contractual journey, but, when the vessel called at Xingang, China, to load additional cargo, 26 of the excavators were discharged and then restowed on deck. On her way to Turkey, the vessel encountered heavy weather, which resulted in the loss of eight excavators, which broke free of their lashes and fell overboard, and also in some minor damage from wetting and rusting to several other excavators that were stowed on deck.

The ruling in The “Kapitan Petko Voivoda” provides several solid arguments why the package limitation should prevail over a breach of the obligation to stow under deck.

Firstly, Langley J. pointed out in the preliminary trial in the Commercial Court that a view was expressed in Carver on Bills of Lading ²⁰² that the Hague-Visby Rules contained their own “fundamental breach” provision, Article IV rule 5(e), which operated as an exception to the application of the limitation of liability, and therefore there was no justification in disapplying the package limitation provision in case of a wrongful deck carriage because the Rules already had this defensive mechanism.²⁰³ Regardless of the fact that the Hague Rules, and not the Hague-Visby Rules, were applicable to the present case, that was a valid point as to the intention of the drafters of the Convention.

Secondly, the words “in any event” in Article IV rule 5 should be construed in their most natural meaning, which is “in every case,” regardless of how serious a breach is involved in the case.²⁰⁴ A reference was made to the reasoning of Tuckey L.J. in The “Happy Ranger” that the words “in any event” are unlimited in scope, leaving little room for doubt whether they will apply to a case of a wrongful stowage on deck:

However, I think that the words “in any event” mean what they say. They are unlimited in scope and I can see no reason for giving them anything other than their natural meaning. A limitation of liability is different in character from an exception. The words “in any event” do not appear in any of the other art. IV exemptions including r.6 and as a matter of construction I do not think they were intended to refer only to those events which give rise to the art. IV exemptions.²⁰⁵

Thirdly, the package limitation provision was held to apply in The “Happy Ranger,” ²⁰⁶ where the carrier could limit his liability under Article IV rule 5, even though he breached his seaworthiness obligation under Article III rule 1, which is considered “overriding.”²⁰⁷ Even though the obligation to carry under deck is an extremely important obligation, it cannot be said to be “overriding.”²⁰⁸ Therefore, if deductive reasoning is applied to the foregoing two propositions, it can be safely concluded that the limitation of liability provision will apply to a breach of the obligation to carry on deck as well.

Eventually, The “Chanda” was overruled, and the decision in The “Nea Tyhi” was approved, meaning that a carrier can limit its liability if it breaches its obligation to carry the goods under deck.

4.5.4.2.3 The Exceptions from Liability in Article IV Rule 2

Unlike the package limitation clause in Article IV rule 5, the provisions in Article IV rule 2 represent a true exemption clause, and, although not impossible, it is unlikely that a carrier that breached its obligation to stow below deck will be able to use the protection of the defenses listed in that latter article.²⁰⁹ The defendants in “The Kapitan Petko Voivoda” tried to rely, among others, on the peril of the sea (Article IV rule 2(c)) and the insufficiency of packing (Article IV rule 2(n)) defense but to no avail. The Court held that if the cause for damage or loss is the carriage on deck and that would not have happened had the goods been carried below deck, a party could not exclude his liability by resorting to Article IV rule 2. This is so because these defenses should be interpreted to apply only to carriage below deck.²¹⁰ Thus, for example, the scope of Article IV rule 2 (c) covers perils of the sea that could cause damage or loss to cargo stowed below deck, and the defense does not stretch to the highly risky carriage on deck. Similarly, the defense in Article IV rule 5(n) covers packing that should be sufficient for under-deck carriage, and it does not require packing to endure the carriage on deck.

The “repugnancy” or “inconsistency” principle, employed by Hirst J. in The “Chanda,” although inappropriately used to reject the package limitation, is applicable to the liability exceptions in Article IV rule 2.²¹¹ Accordingly, these exceptions provisions are “repugnant to and inconsistent with the obligation to stow below deck.”²¹²

4.5.5 Deck Carriage Under Charter Parties

As already noted on numerous occasions,²¹³ when the carriage is effected under a charter party, the Hague or Hague-Visby Rules become facultative, and their application depends on the intention of the parties, which is expressed by the presence or absence of a Clause Paramount in the charter party. In that sense, the contracting parties may exclude the operation of the Rules from their contract by agreeing to base their commercial relations on a charter party, while not inserting a Clause Paramount in the charter.²¹⁴

However, when a charter party incorporates the Hague/Hague-Visby Rules and encompasses deck cargo as well, what is the effect of Article I(c) of the Rules on this particular deck carriage? Could the “contract of carriage,” as stated in the Rules, refer to the charter party and not only to the bills of lading? And if so, should there be a notation on the charter party in order to exclude the deck cargo from the ambit of the Rules as required by Article I(c)? The answer to both questions is no. Article I(c) does not apply to the carriage of deck cargo as between the shipowners and the charterers, and the “contract of carriage” is the relevant bill of lading.²¹⁵ It was held in The “Socol 3” that it would be difficult to apply the definition set forth in that article to a charter party, which is generally not concluded between parties in connection with loading of the cargo, because its subject is the vessel rather than the cargo.²¹⁶ A time charter, for example, can be concluded even before it is clear what cargo will be carried on deck, and it cannot possibly contain an on-deck statement. Therefore, only a bill of lading, and not a charter party, can contain the on-deck statement or notation, to which Article I(c) refers. As pointed out by the authors of Voyage Charters, the process of incorporation of the Rules into a charter party should be “carried out intelligently in relation to the context and not mechanically.”²¹⁷

On the other hand, when the Hague/Hague-Visby Rules are not incorporated in a charter party, there will be no definition of “goods,” and therefore any deck cargo will not be singled out as a specific type of carriage to which specific deck-cargo rules apply (as opposed to the general rules regulating the carriage of below-deck cargo). Subjecting below-deck cargo and on-deck cargo to the same rules is possible, of course, only if special rules regulating deck cargo are not expressly specified in the provisions of the charter party. That is why most charter parties contain a specific provision, or several provisions, related to deck carriage. These charter party clauses, usually, describe and distribute the obligations of the parties with respect to the cargo carried on deck, as well as the pertaining liabilities, should these obligations be not duly discharged by the relevant party. Accordingly, the carriage of deck cargo under charter parties has led to numerous disputes and prompted many decisions on the proper construction of various deck cargo clauses that attempt to shift the responsibility and the risk over cargo carried on deck.

4.5.5.1 Voyage Charter Parties

Under voyage charters, the responsibility for stowing deck cargo can be transferred to any party, depending on, as it is with all charter parties, what the shipowners and charterers have agreed on. For example, the Gencon charter, the most popular and most widely used voyage charter party in all kinds of trades and cargos, provides that in case the shipment of deck cargo has been agreed between the parties, such carriage shall be at the charterer’s risk and responsibility.²¹⁸ The words “and responsibility” emphasize the position that should deck cargo be lost or damaged, the liability stays with the charterers. Yet the charter party does not contain a liberty to stow on deck, let alone an obligation to do so. It merely distributes the responsibility over the deck cargo if the parties agree on such carriage and insert a special provision to that effect. It is important to note in that regard that an agreement between the shipowners and the charterers to carry goods on deck cannot be a defense in an action by a third-party bill of lading holder if that agreement is not incorporated in the bill.

4.5.5.2 Time Charter Parties

Under time charters, the liability issues that arise are more often related to FIOST clauses, i.e., clauses stipulating which party is to be held responsible for loading and stowing (clause 8 of NYPE), and not so much to deck cargo clauses. This is because deck stowage does not differ from below-deck stowage with respect to the question of who is responsible for performing the operation. As discussed at great length in Chap. 3, it is very often that time charter parties contain a clause that transfers the risk and the responsibilities over deck cargo from the shipowners to the charterers, and when the charterer’s obligation to load, stow, and trim the cargo has been subjected to the supervision of the master, the responsibility over the cargo does not revert back to the shipowners unless the words “…and responsibility” have been added. The interpretation of such a FIOST clause, as well as its interaction with a deck cargo clause, laid down in the charter party, may appear problematic in certain instances, especially if the deck cargo clause puts the responsibility on another party contrary to what the FIOST clause states. In general, the two main issues that come before courts are whether or not the cause for the loss or damage of the deck cargo is poor stowage and lashing or whether it is the unseaworthiness of the vessel.

4.5.5.2.1 “At Charterers’ Risk”

In general, such a clause, stating that deck cargo will be carried “at charterer’ risk,” will effectively transfer the responsibility over such cargo from the shipowners to the charterers.²¹⁹ However, when deck cargo is said to be carried “at charterers’ risk,” disputes often arise as to the precise scope of these words. In The “Fantasy,” for example, such a clause, inserted in a NYPE time charter form, provided also for additional duties for the carrier:

63.Deck Cargo: Charterers entitled to load deck cargo provided regulations permit. Deck cargo, if any, to be checked and protected by crew up to twice a day during sea passages, if required by charterers and/or circumstances deemed it appropriate. Same to be tightened up or replaced or additional lashing to be added appropriate to circumstances; such cargo to be carried at charterers’ risk.²²⁰

The vessel The Fantasy was time chartered for the carriage of containerized cargo as all cargo was loaded and carried on deck. Because of adverse weather conditions, one container was washed overboard and 14 others were damaged, while the vessel herself was also damaged. The Court had to establish which party was responsible for the damage caused to and by the deck cargo, where the plaintiffs and the defendants agreed on the assumptions that the damage was a result of the negligent stowage and lashing, on the one hand, and/or of the default on behalf of the crew during the voyage, on the other hand.

Whereas the extra obligation for the shipowners in clause 63 relates to the period during the voyage and is applicable only to deck cargo, the charter party contained also other obligations that related to the loading, stowage, and discharge of any cargo:

8. That the Captain shall … render all customary assistance with ship’s crew and boats. The Captain (although appointed by the owners), shall be under the orders and directions of the Charterers as regards employment and agency; and Charterers are to load, stow and trim and discharge the cargo at their expense under the supervision of the Captain…

42. Loading, Stowing and Discharging: The Master to supervise and be responsible for all loading, stowage and discharging operations.

50. Loading, Stowing, Etc. In the event Charterers have representatives at load and/or discharge ports to advise Charterers’ requirements loading/stowing and or discharging, ship’s command to follow same regarding cargo operations as far as reasonably practicable subject to such requirements not impairing safety/stability of vessel and cargo or not risking damage to same; Master nevertheless to supervise and in all circumstances be responsible for loading, stowing, lashing and discharging in accordance with Clauses 8 and 42…

With regard to clauses 8, 42, and 50 alone, it was already established in Chapter 3 on FIOS(T)²²¹ that the references to the master’s “responsibility” render the shipowners responsible for loading, stowage, and discharge regardless of the fact that it is actually the charterers who employ and pay the stevedores for carrying out these operations. However, the Court was confronted with the argument that clause 63 on deck cargo, which was the only defense that the shipowners relied on, may qualify the obligations in clauses 8, 42, and 52, and negate the original transfer of responsibilities from charterers to shipowners with regard to cargo carried on deck.²²² In other words, what is the scope of the words “at charterer’s risk,” and do they also cover negligence with respect to deck carriage?

The first Court held that the words “at charterer’s risk” are not sufficient to provide protection to the shipowners and exempt them from liability for negligence in performing the crew’s additional duties under clause 63 regarding the deck cargo.²²³ However, it does not follow from this that the shipowners are liable also for negligence in carrying out the loading and stowing obligations that are set in clauses 8, 42, and 50. Here, the owner’s responsibility for loading and stowage collides with the charterer’s acceptance of the risk over deck cargo. After interpreting the inferred intention of the parties,²²⁴ Evans, L.J., held that the responsibility stayed with the charterers under clause 8, while the transfer of responsibility from the charterers to the shipowners under clauses 42 and 50 was negated with respect to deck cargo because of the wording in clause 63 (“…[deck] cargo to be carried at charterers’ risk”).²²⁵ The transfer of responsibility under clauses 42 and 50 was, thus, limited only to cargo that was carried below deck. Consequently, the charterers remained liable for negligent stowage, whereas the shipowners were held liable for the crew’s negligence in fulfilling the additional obligations required for deck cargo and set forth in clause 63 (as stated already, the very same clause could not absolve the shipowners from liability for negligence). In conclusion, it is worth mentioning that, although the words “at charterers’ risk” were not held to be sufficient to exempt from liability for negligence, Evans, L.J., pointed out that the scope of these words depended on the context in which they were found and also that they might, nevertheless, relieve a shipowner from liability in case of a damage caused by third parties who were entrusted with the performance of the relevant operations.²²⁶

With regard to deck cargo clauses (e.g., “at charterers’ risk”) that provide also for additional duties for the shipowners such as the clause seen above in The “Fantasy,” namely that the owners have to check and protect the cargo during the voyage, or such as the deck cargo clause found in The “Visurgis,” ²²⁷ which was coupled with the shipowners’ obligation to perform the lashing of the cargo, it was held that the protection afforded by the deck cargo clause ceases to shield the shipowners if it was established that the loss of or damage to the cargo resulted from the negligence of the crew to perform those obligations.²²⁸

Later decisions provided a better shelter for carriers that were carrying deck cargo and that heavily relied on on-deck exclusion clauses. The Court in The “Danah” extended the protection afforded to carriers by a deck cargo clause and held that “carried on deck at Shipper’s risk with responsibility for loss or damage howsoever caused” covered also negligence.²²⁹ Thus, the additional words “howsoever caused” ensure that negligence is also covered by a deck cargo clause. In this particular case, the clause was inserted in an addendum to extend the operation of a NYPE time charter party. Again, the charter party provided in clause 8 that the “Charterers are to land [sic], discharge, stow, and trim the cargo at their expense under the supervision and responsibility of the Captain.” The Court rejected an argument of the charterers that the deck cargo clause was a mere direction as to what should be inserted in the bills of lading rather than a provision, which deals with the distribution of rights and obligations between the shipowners and the charterers.²³⁰ The deck cargo clause was designed precisely to regulate the rights and obligations of the parties under the charter, and, considering the commercial purpose of a charter party, it is incumbent upon the charterers to ensure that the distribution of these rights and obligations, as stated in the deck cargo clause, will be preserved in the bills of lading that the charterers sign with any third-party shippers.²³¹ An important remark is that the word “responsibility” in the deck cargo clause was held to refer only to damage to or loss of the goods, and it did not encompass a claim by the coastal authorities for the salvaging of hazardous cargo lost overboard.²³²

What is more, a deck cargo exclusion clause may protect the shipowner from liability not only for negligence but also even for unseaworthiness. In The Imvros,²³³ Langley, J., affirmed the reasoning in The “Danah” and extended it to the effect that the words “whatsoever and howsoever caused” in a deck cargo provision in a NYPE time charter party transferred the liability for damaged or lost deck cargo to the charterers, even when that cargo rendered the vessel unseaworthy.²³⁴ Thus, the protection of those words could be relied not only upon negligence but also upon unseaworthiness.²³⁵ The relevant charter party provision read:

Additional Clause 91

Deck Cargo

Charterers are permitted to load cargo on the vessel’s deck and hatch covers provided always that the permissible loads on the deck/hatch covers are not exceeded, that the stability of the vessel permits, and that such cargo does not impair the seaworthiness or safe navigability of the vessel in any manner. Any extra fittings required for deck or hatch cover cargo are to be provided and paid for by the Charterers who are to load, stow, dunnage, lash and secure such cargo in their time and at their expense always to the entire satisfaction of the Master. The vessel is not to be held responsible for any loss of or damage to the cargo carried on deck whatsoever and howsoever caused. [emphasis added]

The effective cause for the cargo being lost overboard was established to be insufficiency of lashing, which had been performed in contravention of the IMO Code of Practice for Ships Carrying Timber Deck Cargoes and which rendered the vessel unseaworthy. In the present case, the cargo-related obligations were divided between the charterers and the shipowners. Like in The “Visurgis,” the charterers in The “Imvros” were responsible for loading and stowing (clause 8), while the vessel’s crew was responsible for lashing (additional clause 48). However, under the latter charter party provision, in fulfilling their lashing obligations, the crew was considered the charterers’ servants. Thus, there was nothing to qualify the deck cargo clause, and the latter shifted the entire responsibility for the loss of the cargo over the charterers.

Regardless of the decision in

The “Imvros,” however, shipowners are advised to carefully draft their deck cargo clauses and not solely to rely on the words “whatsoever and howsoever caused” but to explicitly exclude liability for negligence and seaworthiness because the law on construction of such deck cargo clauses is far from settled, and it is not unlikely that a future Court of Appeal might take a more restrictive approach toward them.²³⁶ For instance, in the Canadian case The “Beltimer,” the Federal Court of Appeal held that the lack of an express reference to negligence in the liberty clause to stow goods on deck was the reason why this clause failed to exclude the carrier’s liability for negligence, as well as for breaching the implied warranty of seaworthiness.²³⁷

Similarly, the Court in The “Socol 3,” a case with a similar straightforward factual background, held that a deck-cargo exclusion clause in a NYPE time charter could not protect the shipowners from liability for their negligence or for the vessel’s unseaworthiness.²³⁸ It was established preliminarily by the arbitration tribunal that there were three causes for the loss of the deck cargo, and these were (a) inadequate stowage of the cargo, (b) insufficient lashing and negligent care of the lashing during the voyage, and (c) the vessel’s instability due to the stowage of the deck cargo, which was known only to the shipowners.²³⁹ The language of the respective deck cargo clause was found by the Court to lack an express reference to negligence or seaworthiness:

Clause 13

[…]

(b) In the event of deck cargo being carried, the Owners are to be and are hereby indemnified by the Charterers for any loss and/or damage and/or liability of whatsoever nature caused to the Vessel as a result of the carriage of deck cargo and which would not have arisen had deck cargo not been loaded [emphasis added].

The Court outlined three factors for interpreting the exclusion clause as one not covering negligence and unseaworthiness: the language of the clause, the context in which it was situated, and the fact that its content was realistic and meaningful if it did not cover negligence and unseaworthiness. Therefore, regardless of the words “and/or liability of whatsoever nature,” the clause was held not wide enough to cover a breach of the seaworthiness obligation or negligence on behalf of the crew, but it only covered liability for damage to or loss of the goods, which was directly caused by the carriage of the deck cargo. This was, thus, considered an exclusion clause, which, if it was purported to effectively exclude negligence and unseaworthiness, must have had an unambiguous wording and clear intent to that effect. Bottom line, the deck-cargo exclusion clause did not cover negligence and unseaworthiness, and thus this decision questioned whether The “Imvros” can still be considered good law.

4.5.5.2.2 “At Charterers’ Own Risk and Expense”

The case The “Darya Tara” ²⁴⁰ is another example of a clause, which transfers the responsibility over deck cargo from the shipowners to the charterers, where the Court was asked to consider the scope and the effect of the words “risk and expense.” This case concerned the issue of who should bear the financial consequences that have arisen from the shifting of a deck cargo. In particular, the vessel Darya Tara was time chartered on an amended NYPE form for a trip from Middlesbrough to Hong Kong and other ports in the Far East. The stowage of the cargo was adequate, but due to severe weather conditions during the voyage, the vessel had to seek port of refuge where the shifting deck cargo was restowed and secured. Thereby, extra costs were accrued comprising additional expenses for relashing the cargo, extra bunkers, the vessel being off hire, and the surveyors appointed by the shipowner’s P&I club. The charter party provisions, which were related to deck cargo, stated as follows:

Line 25: Charterers to have the option to load a full deck cargo … at their own risk and expense subject to the Master’s approval.

Clause 57. Vessel’s Description

[…]

(3) Charterers’ option deck cargo: OK—but vessel has no lashing materials on board and cargo to be loaded always at Charterers’ risk and expense. Furthermore all bills of lading to be claused accordingly.

Whereas the owners contended that these provisions created a complete indemnity with regard to the deck cargo against any loss, the charterers argued that the words “risk and expense” had a more narrow scope and comprised the risk related only to the deck cargo and the expenses associated with loading at the load port. Mance J. held that the words “risk and expense” were not limited only to the period of loading at the original port of loading, but they extended also to the entire carriage, including any restowing and relashing at an intermediate port or a port of refuge.²⁴¹ However, it was the deck cargo that was “at charterers’ risk and expense,” meaning that the words referred to the risk and expense that is related to the deck cargo particularly and not to any risk and expense in general. The word “risk” is focused “on responsibility for the safety and condition of the cargo loaded on deck,” while “expense” focuses “on expenditure involved in the loading and […] (although not specifically mentioned) carriage of such cargo on deck.”²⁴² Thus, damages were recoverable in so far as they are related to the deck cargo, and therefore recovery was allowed of the fees for deck-cargo survey and restowage but not of repairs to the ship, bunkers, or lost hire, which was brought about as a result of the ship’s deviation to the port of refuge.

In conclusion, where the deck cargo is stated in the charter party as “at Charterers’ risk and expense,” the responsibility of such cargo indeed shifts to the charterers, but the shipowners are not indemnified for any consequences whatsoever that may result from the carriage of goods on deck. However, authors assume that clause 13(b) of the revised form of NYPE 1993—“In the event of deck cargo being carried, the Owners are to be and are hereby indemnified by the Charterers for any loss and/or damage and/or liability of whatsoever nature caused to the Vessel as a result of the carriage of deck cargo and which would not have arisen had deck cargo not been loaded”—which provides considerably wider indemnity for the shipowners, might cover even the expenses of the shipowner that were not recoverable in The “Darya Tara” such as bunkers and loss of hire, but this assumption is still unclear and cannot yet be argued with certainty.²⁴³ Some authors are even skeptical as to its effectiveness to cover all liability whatsoever.²⁴⁴

4.6 Selected Problems of Deck Carriage in Other Jurisdictions

4.6.1 France

The French law on deck cargo has been criticized by French scholars and practitioners for being persistently confusing, and the French jurisprudence adds up even more perplexity to the regulation of this type of carriage.²⁴⁵ In essence, carriage of goods on deck in France is subject to two distinct regimes—the first one is governed by domestic law (droit interne) and the second one by international law (droit international).²⁴⁶

4.6.1.1 Droit Interne

Under the first regime, the carrier is allowed to transport goods on deck only when the shipper has granted its consent to such carriage. When the shipper has consented to deck carriage, clauses related to damages and carrier’s liability are held valid by the court. Alternatively, absent such an acceptance on behalf of the shipper, the carriage on deck is considered irregular (fautif), and the carrier is then held liable and can no longer invoke any clauses that exonerate it or limit its liability. Thus, the first regime governing deck carriage in France distinguishes between regular (non fautif) and irregular (fautif) deck carriage.

Two questions arise out of this requirement to seek the shipper’s consent: who is to establish the acceptance of the shipper, and how should this acceptance be established? With regard to the first issue, it is obvious that the burden of proof will rest on the carrier to establish that the shipper has consented to on-deck carriage. The second issue is, however, more difficult to settle. French law does not require a special acceptance on behalf of the shipper, and the shipper’s signature on a bill of lading, comprising an on-deck clause, is sufficient to establish an agreement for such carriage.²⁴⁷ However, very often the bill of lading will not be signed by the shipper because French law does not require anymore that the shipper signs the bills of lading.²⁴⁸ In the particular case of carrying containerized cargo under French law, a carrier is facilitated by an express provision, according to which the shipper’s consent to deck carriage is deemed to have been given if two cumulative requirements are fulfilled: (1) the cargo must be stowed in containers, and (2) the vessel must be specifically equipped for such type of transport.²⁴⁹ Yet this presumption does not apply to loading open-top containers on deck, and, according to French jurisprudence, such carriage is not only irregular but also inexcusable, meaning that the carrier is deprived of the possibility to rely on any exceptions or limitations.²⁵⁰ Thus, the increase in the risk is considered so great when open-top containers are carried on deck that French courts disregard in their assessment the other factors discussed previously, namely the level of knowledge of the cargo owners about such carriage and also how clearly any exemptions have been communicated to the latter. Under French national law, the carriage of open-top containers on deck is clearly considered a fundamental breach of the contract.

4.6.1.2 Droit International

The second regime, regulating deck cargo, relates to the applicable international law. The Brussels Convention of 1924, as amended (The Hague/Hague-Visby Rules), is ratified and adopted by France, and, as regards deck cargo, the interpretation of Article I(c) is prima facie similar to that, which we already observed under English law. “Cargo,” within the meaning of the Convention, includes all goods except live animals and cargo, which by the contract of carriage is declared as carried on deck and is in fact so transported (la cargaison qui, par le contrat de transport, est déclarée comme mise sur le pont et, en fait, est ainsi transportée). French authors underline that the definition in Article I(c) merely denotes the scope of application of the Convention, and therefore when considering deck cargo cases under the Convention, it is no longer correct to divide such carriage into “regular” and “irregular” deck carriage because the Rules do not make such a distinction.²⁵¹

Thus, as previously observed, cargo that is stated as carried on deck and is so carried does not obey the rules of the said Convention, and the carrier cannot avail itself of the defenses and exceptions from responsibility stated therein because the Convention is inapplicable to that shipment; instead, the particular carriage is left to the contractual intention of the parties. On the contrary, if the deck carriage has not been agreed by the parties, the Convention will still apply. The resemblance with English law, however, ends up here.

In the recent case of The “Ville de Tanya,” which was defined by French authors as “an unfortunate decision,”²⁵² containers were carried on deck absent an agreement with the shipper, and during the journey they were lost overboard as a result of a typhoon that the vessel encountered on her way from China to Brazil.²⁵³ The Court of Cassation was faced with, inter alia, the application of the Convention and with the carrier’s defenses under Article IV rule 2. With regard to the first issue, the Court held that a valid agreement for on-deck carriage (capable of excluding the application of the Convention) requires not only a declaration on behalf of the carrier on the face of the bill of lading but also an acceptance on behalf of the shipper.²⁵⁴ This position, which is favorable to shippers and consignees, represents a shocking discrepancy with the wording of the Convention because where the Rules say “declared,” French law says “accepted.” It seems that the Court of Cassation has imported an element from the first regime regulating deck cargo in France into the second regime.

Thus, a simple clause declaring on-deck cargo will not suffice to exclude the Convention as French courts require the carrier to have informed the shipper about the on-deck carriage and also to provide proof of this information, absent which international law (i.e., the Convention) will apply with all its rigor.²⁵⁵ Thus, when the Brussels Convention is applied, a very puzzling approach is adopted with regard to establishing the shipper’s consent to carriage of goods on deck. The Aix-en-Provence Court of Appeal in The “Ville de Tanya” maintained the highly criticized position that in establishing the shipper’s acceptance one should look in the Brussels Convention (the Rules).²⁵⁶ This position, which was later approved by the Court of Cassation, leads to the baffling situation where in order to establish whether the on-deck declaration of the carrier is sufficient to exclude the Rules, one must refer to French law, which requires the acceptance of the shipper, but in order to establish whether this acceptance is present, one must refer to the Rules—an approach that is far from being rational and is difficult to comprehend, even solely because of the absence in the said Convention of anything related to the shipper’s acceptance.²⁵⁷ That is why French Professor Y. Tassel compares this ruling to a “manifest error of law” (erreur de droit manifeste).²⁵⁸ It seems that the French courts overprotect the cargo owners as they give great importance to the factor how clearly the intended deck carriage has been agreed between the parties. The required level of knowledge of the shipper is raised to such an extent that not only a statement in the bill of lading is sufficient, but evidence of the shipper's consent is required as well. Such a rule, shaped by the French jurisprudence, appears to be on the verge of being inconsistent with the wording of the Hague-Visby Rules.

Another point of criticism is that the Court of Cassation confirmed that, in cases of unauthorized deck carriage, the carrier cannot avail itself of the liability exemptions in Article IV rule of the Rules.²⁵⁹ There is one exception, namely that if the cargo is stowed on a ro-ro vessel, then the breach is not considered inexcusable, meaning that the carrier can limit its liability.²⁶⁰ In essence, such a complicated and carrier-unfriendly regime of deck carriage under French law leads to the question whether a possible future ratification of the Rotterdam Rules might provide a clearer and more balanced approach toward deck cargo.²⁶¹

4.6.2 Germany

German maritime law is to be found in the Fifth Book of the Commercial Code—“Handelsgesetzbuch” (HGB), which entered into force on January 1, 1900, and which was mainly based, and basically unchanged, on the general German Commercial Code—“Allgemeine Deutsche Handelsgesetzbuch” (ADHGB), which dated back to 1861. Because the provisions of the HBG (i.e., the Commercial Code of the German Reich) were evidently outdated, several amendments were made throughout the years, and, for the purpose of the current subsection, the most important revisions were the transmission of the 1924 Hague Rules and of the 1968 Visby Protocol. The Hague Rules entered into force in Germany in 1939 by means of the Sea Freight Act of 1937 (Seefrachtgesetz von 1937). Later, in 1986, the Hague-Visby Rules were incorporated in Germany’s maritime law by means of the law of 25 July 1986 (2. “Seerechtsänderungsgesetz”), which was the next maritime amendment of the HGB, after the 1937 amendment, with regard to the carriage of passengers and goods.²⁶²

4.6.2.1 Applicable Regime

The application of the Hague/Hague-Visby Rules is quite peculiar in Germany since the country ratified the Hague Rules (1924) and incorporated them in its Commercial Code (HGB), but it did not ratify either of the two Visby Protocols (1968/1979). Thus, Germany still remains a contracting state to the Hague Rules, which were not applied directly but are to be found only in the framework of the HGB. The revised provisions of the HGB apply to all types of carriage—comprising both liner carriage (under bills of lading) and tramp carriage (under charter parties), as well as both international trade and national trade.²⁶³

Although Germany is not a signatory state to the Visby Protocol of 1968 and has not formally ratified the Hague-Visby Rules, these were fully incorporated in the Fifth Book of the HGB in 1986.²⁶⁴ In other words, the country has ratified the Hague Rules, and, though it does not adhere to the Visby Protocol, it has incorporated the provisions of the Visby Protocol in the German maritime law. Therefore, a vital question would arise for any maritime contracting party, and that would be whether the Brussels Convention 1924 (The Hague Rules), to which Germany is still a party, is applicable or whether domestic law, which conforms to the Hague-Visby Rules, is to apply. Germany’s private international law offers a complicated provision, which settles this difficulty by providing choice of law rules for bills of lading. According to Article 6 of the Introductory Law to the Commercial Code (Einführungsgesetz zum HGB) (EGHB), Germany’s domestic law, which is modeled after the Hague-Visby Rules, will apply to all member states of the Visby Protocol, as well as to states that are a party neither to the original Hague Rules nor to the Hague-Visby Rules, and also with regard to carriages from one German port to another provided that the ship flies the German flag. In particular, the provisions that embody the Hague-Visby Rules will apply when (a) the bill of lading has been issued in a state party to the Hague-Visby Rules or (b) the carriage is to or from a port in such a state or in Germany or (c) the bill of lading refers expressly to the Hague-Visby Rules or to the law of a state that has incorporated the Hague-Visby Rules into its legislation.²⁶⁵ This comprehensive wording means that the Visby Protocol will apply in the vast majority of cases.

However, the unamended Hague Rules will still apply with regard to contracting states to the Hague Rules—i.e., when the bill of lading is issued in such a state (including Germany) and (1) the carriage is from a Hague Rules country (including Germany) to another Hague Rules country or (2) the carriage is between two German ports provided that the vessel flies a foreign (i.e., non-German) flag or (3) the carriage is from a country, which is neither a Hague Rules country nor a Hague-Visby Rules country, to a Hague Rules country.²⁶⁶ Such application of the unamended Rules, though in very limited situations, is because of Germany’s obligations toward these Hague Rules states, which result, under international law, from the German ratification of the Brussels Convention 1924 (the original Hague Rules).

4.6.2.2 The Maritime Law Reform

The amendments adopting the Hague and the Hague-Visby Rules were considered only a patch-up and were not adjusted to modern developments.²⁶⁷ Therefore, an amendment was needed of the statutory provisions of Germany’s maritime law. This modernization of law came into existence with the latest revision of Germany’s maritime law (the Fifth Book of the HGB), which came into effect on April 25, 2013, after nearly a decade of discussions and considerations on a new maritime law reform in Germany.²⁶⁸ This complete revision of HGB’s Fifth Book modernized and simplified the German maritime law.²⁶⁹ An overview of the most significant changes to German maritime law is beyond the scope of this book, but what suffices to be said in relation to deck carriage are two important points.

The first one relates to the executing carrier under German law and, in particular, who is to be held responsible for carriage on deck. German law distinguishes between a contractual carrier and an actual carrier, the latter being the person or company that in effect performs part or all of the transport but that cannot qualify as a contractual carrier.²⁷⁰ Thus, the concept of an actual carrier includes subcarriers, charterers (disponent owners), and terminal operators. According to Article 509 HGB, the actual carrier is jointly liable with the contractual carrier with regard to damages that occurred during the carriage performed by him as if he would be the contractual carrier. This statutory provision will apply when German law is applicable to the main contract between the owner (the contractual carrier) and the shipper, regardless of what has been agreed upon between the contractual carrier and the actual carrier in their separate contract.²⁷¹ Article 509 HGB will hold the actual carrier (e.g., a terminal operator loading cargo on deck) responsible for damages, even when there is no direct contractual link between him and the cargo interests.²⁷²

The second point, which is of importance to carriage of cargo on deck, is related to the incorporation of charter party terms, such as a deck cargo clause, into a bill of lading. According to Article 522 HGB, the terms of a charter party are validly incorporated in a bill of lading only if these terms are explicitly reproduced in the bill. On the contrary, a mere reference to those charter party terms is not sufficient, under German law, to hold these terms valid under the bill of lading. For example, clause 1 of the conditions of carriage in CONGENBILL 2007 states that “All terms and conditions, liberties and exceptions of the Charter Party, dated as overleaf, including the Law and Arbitration Clause/Dispute Resolution Clause, are herewith incorporated.” Thus, the standard form of this BIMCO bill of lading, which is to be used with charter parties, contains general incorporation of charter party terms which will not be valid under German law, and therefore the terms will not be accepted as clauses of the bill of lading. This means that, under the revised German maritime law, charterers have to redraft their bills of lading so that the charter party terms, which are envisaged to be incorporated, are written explicitly on the bill of lading.

4.6.2.3 Deck Carriage

Under the revised German maritime law, cargo cannot be carried on deck unless there is an approval on behalf of the shipper.²⁷³ However, it is important that, unlike under English law, the consent of the shipper under German law may be declared impliedly.²⁷⁴ For example, when on the face of the bill of lading there is an option to stow on deck, and if the shipper does not object to that optional deck stowage, this will be held as an acceptance to carriage on deck.²⁷⁵ This means that, unlike English law and especially in contrast to French law where the shipper's consent is required, German law provides significantly less protection to deck cargo owners. Furthermore, Germany’s revised maritime law provisions took into account containerization, so when the cargo is carried in containers or in another type of a loading device suitable for the carriage on deck, and if the vessel is specifically equipped for deck carriage, such consent is not necessary.²⁷⁶ Again, in the container trade carried out by specially built container vessels, the traditional doctrine on deck cargo and its concept requiring an informed consent and clear communication of the risks are rendered inapplicable.

In case of an unauthorized deck carriage, Article 500 HGB (Unauthorized loading on deck) states that there is a presumption of liability on the part of the carrier even if it is not at fault and the loss or damage is caused solely by the risks inherent in deck carriage.²⁷⁷ Moreover, the carrier cannot rely on any exemptions or limitations of liability if it has agreed with the shipper to transport the goods below deck but has, nevertheless, loaded them on deck.²⁷⁸

In case of authorized deck carriage, the carrier’s liability is excluded to the extent that the loss, damage, or delay in delivery is due to the carriage on deck.²⁷⁹ Damage that could arise because of deck carriage, depending on the circumstances of the case, is assumed to have resulted from deck carriage. This presumption, however, does not apply to cases of exceptionally great loss.²⁸⁰ Equally important, the carrier cannot avail of this general deck-cargo exception from liability, either, when the loss, damage, or delay in delivery of the goods is due to the fact that the carrier has not complied with any special instructions given to him by the consignor with respect to the carriage of the goods.²⁸¹

The current German regime on deck cargo is likely to last for a considerable period of time provided that the last reform took place just a few years ago. Germany has not incorporated the Hamburg Rules, nor did it take the Rotterdam Rules into account. The latter may be adopted only in a further reform of Germany’s maritime law, “if [and not when!] the Rotterdam Rules have been ratified by Germany.”²⁸² For the time being, and considering the background of Germany’s current maritime law, this does not seem as a viable development.

4.6.3 The Netherlands

The Netherlands have ratified the Visby Protocols (1968/1979), and thus the country has applied the Hague-Visby Rules since 1982.²⁸³ The Rules are incorporated in Book 8 of the Dutch Civil Code, dedicated to transport law and means of transport.²⁸⁴ The law regulating deck cargo is codified in Article 382 of Book 8:

Article 8:382 Mandatory law in case of carriage under a bill of lading:

1. Any clause in a contract of carriage under a bill of lading relieving the carrier or the ship from liability for loss of or damage to or in connection with goods arising from negligence, fault or failure in the duties and obligations provided for in Articles 8:381, 8:399, 8:411, 8:414 paragraph 1, 8:492, 8:493 or 8:1712 or lessening such liability otherwise than in the way as provided for in the present Section (Section 8.5.2) or in Articles 8:361 up to and including 8:366, shall be null and void and of no effect. A clause as a result of which the benefit under an insurance policy belongs to the carrier or any clause with a similar necessary implication shall be deemed to be made in order to relieve the carrier from his liability.

2. Notwithstanding paragraph 1, a clause as mentioned there shall be valid if it concerns:

• a.

  a permitted clause concerning general average;

• b.

  live animals;

• c.

  goods which actually are transported on the deck provided that they are specified in the bill of lading as deck cargo. [emphasis added].²⁸⁵

Article 382 reflects Article I(c) and Article III rule 8 of the Hague-Visby Rules. The first paragraph of the provision forbids parties to contract out from their obligations under Article 381 (the duty to exercise due diligence as to seaworthiness and care for the cargo), Article 399 (the duty to issue a bill of lading), Article 411 (consignor’s duty to provide correct information), Article 414 paragraph 1 (over the evidential value of the bill of lading), Article 492 (legal presumption regarding the condition of the goods), Article 493 (duty to cooperate in inspection of goods and tallying of packages), and Article 1712 (time limitations under bills of lading) or to lessen howsoever the carrier’s liability as stated in the relevant provisions of Book 8 and renders any such clauses as null and void. Additionally, paragraph 2, item c of Article 382 makes an exception to such clauses, notwithstanding paragraph 1, when “goods which actually are transported on the deck provided that they are specified in the bill of lading as deck cargo.” Thus, Article 382 paragraph 2 covers “deck cargo” within the meaning of Article I(c) of the Rules, and deck cargo that is not specified as such in the bill of lading is subject to the liability regime of the Hague-Visby Rules.²⁸⁶

In essence, cargo should not be loaded on deck without the consent of the shipper, which is similar to the position under English law. However, under Dutch law, even when there is no consent on behalf of the shipper, the carrier can still prove that carriage on deck is not mishandling in and of itself if it manages to show that such carriage is not a breach of the contract in the light of the nature of the cargo, the nature of the means of transport, and other circumstances. However, if there has been an agreement for below-deck carriage, the carrier cannot rebut the assumption of mishandling and breach of contract.²⁸⁷

In practice, an on-deck statement that the cargo is in fact carried on deck is accompanied by a “deck cargo at shipper’s risk” clause.²⁸⁸ Dutch courts, however, interpret the scope of this clause controversially. Under English law, the same uncertainty was observed as to the width of this exception clause. In the Dutch case “Anna-Bella,” the Court in the Hague held that such a clause was considered as a complete exoneration from liability for damage to deck cargo for any cause whatsoever, and the entire risk shifted to the cargo interests.²⁸⁹ Such a wide interpretation of the deck cargo clause was also observed in the case “Lijnbaansgracht” before the Court of Amsterdam.²⁹⁰ However, the Court in “Jeannie” made a distinction between nonresponsibility clauses (wide enough to except any responsibility related to deck cargo) and shipper’s risk clauses (which covered only risks directly associated with the on-deck carriage and does not except the carrier from its own fault such as insufficient lashing or wrong stowage).²⁹¹ Furthermore, such a clause was held not to protect the carrier when damage to deck cargo was due to breach of the carrier’s unseaworthiness obligation.²⁹² Nor will it be held a valid defense for the carrier when the damage to deck cargo is caused by the carrier’s negligence, unless the parties have agreed to encompass negligence as well.²⁹³ Amid these conflicting decisions, Dutch scholars tend to prefer the interpretation in the “Anna-Bella” decision, namely that the clause relieves the carrier from liability even when it failed to carry out its duties to properly and carefully care for the cargo.²⁹⁴

With regard to unauthorized deck carriage, the absence of such a clause, stipulating deck carriage, will render the carrier liable according to the liability provisions of the Hague-Visby Rules as incorporated in Book 8 of the Dutch Civil Code.²⁹⁵ This suggests that the doctrine of fundamental breach has no application whatsoever as far as deck cargo under Dutch law is concerned.

4.6.4 Norway

Norway has denounced the Hague Rules, but the Hague-Visby Rules are active and are codified in Chapter 13 (Carriage of General Cargo) of the Norwegian Maritime Code of 24 June 1994. The Norwegian Maritime Code has a long legislative history, and its provisions are very close, but not identical, to those of the maritime codes of the other Scandinavian countries (i.e., Sweden, Finland, and Denmark).²⁹⁶

Section 263 of the Code governs carriage of goods on deck as follows:

Section 263 Deck Cargo

Goods can be carried on deck only if this is in accordance with the contract of carriage, custom of the trade or other usage in the trade in question or is required by statutory rules or regulations based on statutory rules.

If, according to the contract, the goods may or shall be carried on deck, this shall be stated in the transport document. If this has not been done, the carrier has the burden of proving that carriage on deck was agreed. The carrier cannot invoke such an agreement against a third party who has acquired the bill of lading in good faith.

Special rules on liability for deck cargo are contained in Section 284.

The provision regulates deck carriage in a clear and consistent way, although it does not address specifically containerized cargo. According to Section 263, the carrier is permitted to load and carry cargo on deck only in three situations: (1) when such carriage is in accordance with the contract of carriage, (2) when it is in accordance with the custom of the trade or other usage in the trade in question, or (3) when deck carriage is required by law (e.g., applicable with regard to some dangerous goods). With regard to the first category of deck cargo, Section 263 requires that such deck carriage is stated in the transport document. A definition of a “transport document” is provided in Section 251, which states that this means “a bill of lading (konnossement) or other document issued as evidence of the contract of carriage.” The term “other document” further refers to a sea waybill (sjøfraktbrev), which is defined in Section 308. Therefore, if the contract of carriages envisages deck carriage, the carrier is required to state that in the bill of lading or sea waybill. However, if it fails to insert such a statement, it is not automatically held liable, but it has the burden of proving that an agreement to carry on deck exists. If the contract of carriage is evidenced by and contained in a bill of lading, such failure to state deck cargo is, in general, more severe.²⁹⁷ This is because an on-deck agreement cannot be invoked as against a third-party bill of lading holder who has acquired the bill of lading in good faith, and this bill of lading does not state that goods may or shall be carried on deck.

The carrier is subject to different liability depending on whether deck cargo was in accordance with Section 263 or in breach of it. In the first case, when cargo was legitimately carried on deck, the normal liability rules of the Norwegian Maritime Code will apply. This means that legitimate deck cargo is governed by the same liability rules as under-deck cargo, which rules are laid down in Chapter V (The Carrier’s Liability for Damages) in Sections 274–289.²⁹⁸ However, it is not possible to subject deck cargo to more lenient rules than below-deck cargo.²⁹⁹

When the goods are carried on deck in breach of Section 263 (which will be the result also when the carrier cannot prove an agreement for deck carriage absent a statement in the transport document or cannot invoke such an agreement against a third party), then the special rules on liability in Section 284 apply:

Section 284 Liability for deck cargo

If goods are carried on deck in breach of Section 263, the carrier is liable, irrespective of the provisions of Sections 275–278, for losses which are exclusively the consequence of the carriage on deck. Concerning the extent of the liability, Sections 280 and 283 apply.

If goods have been carried on deck contrary to an express agreement for carriage under deck, there is no right to limitation of liability according to this Chapter.

The provision bans the carrier in fault from relying on sections that would otherwise exonerate it such as in the cases of nautical fault or fire. The carrier is deprived of its defenses, however, if the deck cargo has been damaged or lost for reasons that are exclusively the consequence of the deck carriage. Thus, for example, if cargo that is illegitimately carried on deck is damaged because of a navigational error, the carrier may exonerate itself, relying on the nautical fault defense, only if this navigational error equally affected on-deck and below-deck cargo, making it irrelevant, for establishing the cause of damage or lost, where the cargo was stowed. Section 284, however, preserves the carrier’s right to limit its liability in cases of illegitimate deck cargo.

The right to limit liability is definitively lost in the specific case when carriage on deck took place contrary to an express written or oral agreement to carry under deck. This approach toward a carrier, which loads on deck in breach of an agreement with the shipper to carry below deck, is also to be found in the Rotterdam Rules.³⁰⁰

4.6.5 Sweden

Sweden has also denounced the Hague Rules and currently applies the Hague-Visby Rules. The Swedish Maritime Code (2006) was last amended in 2013. The provision governing deck cargo has not been changed:

Deck cargo

Section 13. Goods may be carried on deck only if it is allowed by the contract of carriage, follows from any custom or usage of the trade in question or is required by any law or statutory provision

If according to the contract the goods shall or may be carried on deck, this shall be indicated in the transport document. If this has not been done, the carrier must prove that carriage on deck has been agreed. The carrier may not invoke such agreement against any third party who has acquired the bill of lading in good faith.

Special rules on liability for deck cargo are provided in section 34.

Since the provision is essentially matching the respective section in the Norwegian Maritime Code, it will not be elaborated further.

4.7 Deck Cargo Under the Rotterdam Rules

4.7.1 A Modernized Approach to Deck Cargo

From the previous sections, it is evident that the development of the law on deck cargo has come a long way. So are the vessels, the technology, and the entire shipping industry. In the early twentieth century, when the Hague Rules were negotiated, carriage of goods on deck was a very exceptional case because it bore substantial risks “that it is not fair to put upon the carrier.”³⁰¹ Only in some specific trades, such as carriage of timber, was deck cargo not considered an unusual practice. This is also the reason behind the exclusion of deck carriage from the scope of the Hague Rules (Article I(c)).³⁰² Already at the First Session of the Hague Conference, it was “pointed out [by the Chairman] that this trade was subject to such uncertainties that it did not seem possible to take account of them in a convention covering the carriage of goods in general.”³⁰³ Four decades later, the drafters of the Visby Protocol (1968) also found it unnecessary to address deck carriage and to include provisions that regulate such type of sea carriage.³⁰⁴

The problem of deck carriage under the Hague-Visby Rules, however, is mainly that old principles are applied to new realities and to modern shipping practices.³⁰⁵ Nowadays, deck carriage is no longer considered an improper system to transport goods by sea, and it is in fact a very common one with regard to both containerized and noncontainerized goods. With regard to deck cargo, there are two major developments that took place in the shipping industry, and these are the container revolution and the consequent innovations in ship design.³⁰⁶ These two developments blurred the previously clear distinction between on-deck carriage and below-deck carriage, and the logic behind Article I(c) of the Hague and Hague-Visby Rules is based exactly on that distinction. Nowadays, however, undesirable results are yielded when applying these outdated deck cargo rules to the contemporary shipping practices, where even the notions of on deck and under deck are not that certain anymore, especially when applied to container vessels.³⁰⁷ For example, some container vessels do not have hatches covering their holds, and that is why, in this case, the tanktop in the hold will be considered their “deck.”³⁰⁸

The Rotterdam Rules, on the other hand, take into account these developments, namely containerization and specialized deck vehicles of carriage, which are viewed as the “backbone” of deck carriage.³⁰⁹ The new Convention no longer excludes deck cargo from the regulatory regime. What is more, the Rotterdam Rules apply an all-embracing net that applies to all goods and include even a provision for live animals³¹⁰:

Article 1

Definitions

[…]

24. “Goods” means the wares, merchandise, and articles of every kind whatsoever that a carrier undertakes to carry under a contract of carriage and includes the packing and any equipment and container not supplied by or on behalf of the carrier.

The definition provided in Article 1.24 suggests that whatsoever goods, in any manner of stowage and package, both below deck and on deck, authorized and unauthorized, are subject to the Rotterdam Rules and governed by its provisions. Furthermore, the Convention offers a completely new set of rules that apply to deck cargo and that are codified in Article 25 entitled “Deck cargo on ships,” which is found in Chapter 6 of the Rules (Additional provisions relating to particular stages of carriage). Under the Rotterdam Rules, deck cargo is no longer divided into authorized (declared) and unauthorized (undeclared) but classified into permissible and nonpermissible deck carriage.

4.7.2 Permissible Deck Carriage

The first paragraph of Article 25 lists three categories of permissible carriage on deck:

Article 25

Deck cargo on ships

1. Goods may be carried on the deck of a ship only if:

(a) Such carriage is required by law;

(b) They are carried in or on containers or vehicles that are fit for deck carriage, and the decks are specially fitted to carry such containers or vehicles; or

(c) The carriage on deck is in accordance with the contract of carriage, or the customs, usages or practices of the trade in question.

The phrase “only if” in Article 25.1 implies that deck carriage in all instances, other than the three circumstances indicated in (a), (b), and (c), will be considered nonpermissible and, hence, unauthorized.

Article 25.1(a) allows carriage on deck in the various situations when this is required by law. This could be the case with dangerous cargo to which specific safety regulations apply (e.g., the IMDG Code or the IMSBC Code), which require that the particular hazardous substances are carried on deck only.

Article 25.1(b) takes into account containerization. The provision governs deck carriage of goods that are carried in or on containers or vehicles that are fit for deck carriage provided that the deck of the vessel is specially fitted for such carriage, which means that it must cover certain technical standards for stowing, lashing, and securing the containers or vehicles.³¹¹ Some authors refer to that quality of the vessel as “deck-cargoworthiness,” and if she fails to cover these standards, the carrier will be liable.³¹² On the other hand, the definition of a “container” and of a “vehicle” in Articles 1.26 and 1.27, respectively, reads as follows:

Article 1

Definitions

[…]

26. “Container” means any type of container, transportable tank or flat, swapbody, or any similar unit load used to consolidate goods, and any equipment ancillary to such unit load.

27. “Vehicle” means a road or railroad cargo vehicle.

The first definition is very broad and embraces, essentially, any type of containers including semi-closed and open-top containers. Similarly, the second definition includes both road cargo vehicles and rail cargo vehicles. This means that specialized containerships, as well as ro-ro vessels, which normally carry cargo vehicles and trailers, comply with the requirements falling under Article 25.1(b). In essence, the provision offers the carrier flexibility as to where to stow the goods (below deck or under deck) provided that the cargo and the vessel meet the conditions set forth in the article.

Article 25.1(c) permits carriage on deck when such carriage is in accordance with the contract of carriage or the customs, usages, or practices of the trade in question. This agreement may be explicitly stipulated by the parties, but it may also be implied in case there are usages, customs, or practices according to which the cargo in a particular trade may be carried on deck.³¹³ An example of such shipments is the carriage of woods on deck, as well as the carriage of large and out-of-gauge equipment such as yachts, wind mills, drilling platforms, etc.

When the carriage on deck is governed by any of these three subsections of Article 25.1, the carriage is permissible, meaning that it is permitted by the Rotterdam Rules, and a breach of contract cannot result from such carriage. Under subparagraphs (a) and (c), carriage will be permissible regardless of the type of the vessel, whereas subparagraph (b) requires the use of specially designed ships, which include not only container vessels but also any other ships that are fitted to carry containers or deck-carriage vehicles on board.

Furthermore, one big difference of the Rotterdam Rules, as compared to the Hague-Visby Rules, is that the normal liability rules of the new Convention are equally applicable to all three types of deck cargo. The relevant Article 25.2 reads:

Article 25

Deck cargo on ships

[…]

2. The provisions of this Convention relating to the liability of the carrier apply to the loss of, damage to or delay in the delivery of goods carried on deck pursuant to paragraph 1 of this article, but the carrier is not liable for loss of or damage to such goods, or delay in their delivery, caused by the special risks involved in their carriage on deck when the goods are carried in accordance with subparagraphs 1 (a) or (c) of this article.

When speaking of the carrier’s obligations over deck cargo and the ensuing liability, it is worth reminding the fact that goods that are stowed on deck must be taken into consideration when assessing the duty to care for the cargo. Deck cargo is exposed to the weather elements, and therefore it may require a higher duty of care (e.g., covering with tarpaulins to protect the goods from heat or rain) than cargo that is stowed below deck. However, the carrier, under the Rotterdam Rules, retains its right to limit liability, and furthermore he will be excepted from liability for the loss of, damage to, or delay in the delivery of deck cargo, carried in accordance with subparagraphs 1(a) and 1(c), if these are caused by the special risks that are involved in deck carriage.

Two points deserve attention with regard to paragraph 2 of Article 25. Firstly, this carrier-friendly qualification does not apply to containerized cargo and deck vehicles. It addresses only deck cargo that is required to be so carried by law (subparagraph 1(a)) and deck cargo that is carried in accordance with the contract of carriage or the customs, usages, or practices in the particular trade (subparagraph 1(c)). The reason why not all three categories of deck cargo fall under this provision is probably that subparagraphs (a) and (c) leave no choice for the carrier and the shipper but to stow and carry the goods on deck, whereas subparagraph (b) allows for discretion as to the location of the cargo. Secondly, the Rotterdam Rules do not provide a definition of “special risks,” but, presumably, these are the inherent risks that are associated with cargo being washed overboard or damaged because of the exposure to weather and seawater as the most important factors in assessing those risks are the nature of the cargo and the circumstances of the voyage.³¹⁴ In that sense, if the risks are likely to appear both to below-deck cargo and to on-deck cargo, then these risks are not “special risks” (e.g., fire caused by the nature of an adjacent cargo). On the contrary, if the risks are specific to carriage on deck, then the exception from liability provision in paragraph 2 will apply (e.g., fire caused by natural elements such as lightning or seawater causing a chemical reaction). Thus, the qualification in Article 25.2 represents a specialized version of the liability provision in Article 17.2 to the extent that the cause for loss, damage, or delay cannot be attributed to the carrier.³¹⁵

Finally, there is a widely shared view that, besides these three categories listed under (a), (b), and (c), there is also a fourth category in Article 25, and this is namely any deck carriage that is not governed by one of these three subsections.³¹⁶ Grounds for recognizing such a category of deck carriage is Article 25.3, which speaks of “goods carried on deck in cases other than those permitted pursuant to paragraph 1 of this article.” In the current work, however, any on-deck shipment that is not covered by Article 25.1 will be regarded as nonpermissible deck carriage as opposed to the three categories listed in paragraph 1.

4.7.3 Nonpermissible Deck Carriage and the Carrier’s Liability

As already explained in Chap. 2, Sect. 2.5.6, above, the Rotterdam Rules apply a fault-based system for establishing liability and available defenses. And this system applies to all the three categories of permissible deck cargo outlined in subparagraphs (a) to (c) with the abovementioned exceptions and stipulations.

This is not the case, however, with nonpermissible deck carriage. Paragraph 3 of Article 25 contains a special provision for all other types of deck carriage that are not covered by the first paragraph:

Article 25

Deck cargo on ships

[…]

3. If the goods have been carried on deck in cases other than those permitted pursuant to paragraph 1 of this article, the carrier is liable for loss of or damage to the goods or delay in their delivery that is exclusively caused by their carriage on deck, and is not entitled to the defences provided for in article 17.

When the goods are carried on deck in nonpermitted circumstances under the Rotterdam Rules, the carrier is liable and cannot rely on any defenses provided for in Article 17 when the loss of, damage to, or delay in the delivery of the deck cargo is exclusively caused by the carriage on deck. The phrase “exclusively caused” again refers to the special risks that are inherent in the carriage on deck (i.e., seawater and weather elements).³¹⁷ The exclusive causation also means that the carrier will lose its defenses under Article 17 only when the nonpermissible deck carriage is the sole reason for the loss, damage, or delay in the delivery. Conversely, if, besides the nonpermissible deck carriage, there is another cause for the loss, damage, or delay in the delivery, then Article 17 will fully apply to the entire shipment regardless of Article 25.3. Moreover, the carrier retains its right to limit its liability under Article 59.

However, the carrier will further lose its right to limit liability if it carries goods on deck in breach of an express agreement with the shipper to carry the goods below deck and the loss, damage, or delay in delivery are caused by that carriage on deck:

Article 25

Deck cargo on ships

[…]

5. If the carrier and shipper expressly agreed that the goods would be carried under deck, the carrier is not entitled to the benefit of the limitation of liability for any loss of, damage to or delay in the delivery of the goods to the extent that such loss, damage, or delay resulted from their carriage on deck.

It can be assumed that, in this case, the carrier will also lose its right to rely on the defenses in Article 17 since such nonpermissible deck carriage falls outside the permitted categories of deck cargo and is, thus, also struck by Article 25.3.

Article 25 also contains a rule in paragraph 4, which protects third-party bill of lading holders:

Article 25

Deck cargo on ships

[…]

4. The carrier is not entitled to invoke subparagraph 1 (c) of this article against a third party that has acquired a negotiable transport document or a negotiable electronic transport record in good faith, unless the contract particulars state that the goods may be carried on deck.

This rule enshrines the principle of “the informed consent” observed above in the regulation of deck carriage under the Hague-Visby Rules—a party must know what he or she has agreed on in their contract. Accordingly, the permissible deck carriage in Article 25.1(c) of the Rotterdam Rules, and therefore the exception in Article 25.2, does not apply as between a carrier and a third party who acquired a negotiable transport document in good faith if the contract particulars do not state that the goods may be carried on deck. This means that the carriage in accordance with an express or implied agreement will become nonpermissible, and as such it will be subject to the same rules as those laid down in Article 25.3 described above. On the other hand, the word “may” in Article 25.4 refers to a liberty clause to carry on deck, meaning that no express statement or notice is required on the bill of lading that the goods will be carried on deck. A liberty clause inserted in the bill suffices for the carriage to be covered by Article 25.1(c), which allows the carrier to invoke the exclusion of liability under Article 25.2, provided that the specific conditions for that are met. Another important point derived from reading the wording of the provision is that paragraph 4 does not apply to nonnegotiable bills of lading, meaning that a third-party holder will be protected only under negotiable transport documents.

Considering Articles 25.3 and 25.5, it is evident that the Rotterdam Rules do not apply the doctrine of fundamental breach or the doctrine of deviation.³¹⁸ However, some of the consequences of nonpermissible deck carriage resemble those of a fundamental breach of the contract of carriage.

4.7.4 Assessment of the Rotterdam Rules’ Position on Deck Cargo

The law on deck cargo is one good example of an area of law that is handled in a superior manner under the Rotterdam Rules than under the Hague/Hague-Visby Rules, where it is not addressed at all. The new Convention regulates and accepts deck carriage as a permissible practice as long as it conforms to certain requirements, failing which there will be a breach of the contract of carriage. Article 25 of the Rotterdam Rules recognizes the advent of containerization, and it also “was welcomed as an appropriate apportionment of liability in conformity with the freedom of contract regime.”³¹⁹ Probably the most important characteristic of the Rotterdam Rules’ approach toward deck cargo is rendering an account of the containerization and of the subsequent technological transformation, which reduced the risks that pertain to deck carriage. What is more, the new Convention managed to efficiently distribute these risks between the parties to the contract of carriage. If the Rotterdam Rules gain the worldwide support, it is likely that the current diversity of national rules related to deck cargo will be unified in an international regime.

Before leaving the problem of the Rotterdam Rules’ position on deck cargo, consideration must be given to another observation. Historically, the rules governing on-deck carriage has been left outside the scope of the international regimes and instruments (e.g., the Hague-Visby Rules, Article I(c); York Rules 1864 and York-Antwerp Rules 1877 and 1890), which regulate maritime transport. As stated in the beginning of the chapter, this was done on purpose because such transportation has a very special nature and was accompanied by immense risks in the past. However, one can notice that regulating deck carriage has gradually been included in international conventions. The change is seen in several international agreements: the Hamburg Rules (Article 9), the Rotterdam Rules (Article 25), and the York-Antwerp Rules 1924, where “Rule I: Jettison of Cargo” has changed, omitting the description of deck stated previously therein: “Every structure not built in with the frame of the vessel shall be considered to be a part of the deck of the vessel.”

Table 4.2 will summarize the change with regard to deck cargo observed in the York/York-Antwerp Rules, which set maritime rules that codify the law of general average.³²⁰ Rule I of these rules is dedicated to the Jettison of Deck Cargo, and it has undergone a significant transformation throughout the years.

Table 4.2 Rule I on Jettison of Deck Cargo in the York/York-Antwerp Rules

As evident, in the York Rules 1864, the rule initially excluded deck cargo from the scope of the instrument. There was, however, one exception, namely the carriage of wooden products on deck pursuant to a general custom within that trade. Later on, the York & Antwerp Rules 1877 amended the article so that deck carriage was excluded altogether from the rules on general average. The York-Antwerp Rules 1890 preserved the article unamended. However, the York-Antwerp Rules 1924 omitted the provision, defining “deck carriage,” and modified the article so that cargo carried on deck “in accordance with the recognized custom of the trade” fell within the provisions of the Rules. No other change in that article was observed in the next four editions of the York-Antwerp Rules.

4.8 Conclusion

In this chapter, it has been shown that the kernel of the obligations of the carrier over deck cargo is mostly buried in the bill of lading and in the way courts interpret its terms in the context of the statutory regulations. For determining whether or not a carrier is liable for loss of or damage to cargo stowed and carried on deck, the starting point of reference is precisely the terms of the bills of lading, as well as to what extent and how the bill evidences the terms of the contract of carriage. The latter is particularly important with regard to third-party bill of lading holders.

Although the current law on deck cargo is steadily departing from the traditional doctrine and although the old views on deck cargo are becoming increasingly inapplicable in certain trades, courts can still harshly punish carriers that, for example, have issued a clean bill of lading for the on-deck shipment of containers carried on a specially built container vessel. Other courts, however, put more emphasis on the factual inquiry and take the stance that the nature of the cargo as well as “technological innovation and vessel design may justify stowage other than below deck.”³²¹

Unfortunately, it was established that no uniformity could be found in the UK, in the US, and under civil law when it comes to treatment of cargo stowed on deck. Perhaps the main culprit for having sets of rules on deck cargo, which stem from the same Convention but which differ so much, is the lack of conceptualization of the terms “legal” and “illegal” deck cargo. Obviously, the standards whether cargo is authorized to be carried on deck or not vary quite substantially as some courts still tenaciously require any deck cargo to be specifically mentioned on the face of the bill of lading regardless of an established custom in the trade, while others apply a less restrictive approach and depart from the old doctrine of deck cargo. This lack of uniformity on the concept of legal/illegal deck cargo has resulted in courts interpreting differently the scheme established by Article I(c) of the Hague-Visby Rules and placing nonuniform burden on the carrier and on the cargo interests. An objective construction of the Hague-Visby Rules leads to the observation that the Rules afford less protection to owners of deck cargo as opposed to owners of below-deck cargo, or even no protection, if such carriage and the pertaining risks have been communicated accordingly and the Rules have been excluded. Perhaps this is the reason why courts in some jurisdictions such as Belgium have taken the other extreme and overprotect cargo owners when deck carriage is involved. In practice, this nonuniformity in adjudication is translated into disputes with often unpredictable outcomes and solutions that are difficult to foresee by the parties. In legal terms, the various and differing approaches to deck cargo at national level deprave the Hague/Hague-Visby Rules regime of its essential purpose—to set up an equilibrium balancing the interests of the carrier and the shipper, which is uniform, easy to prognosticate, and capable of being applied to any situation.

This is another piece of evidence that leaving deck carriage outside the ambit of the Hague Rules may have been an appropriate approach a century ago, but nowadays the lack of a uniform and harmonized statutory regulation for that type of carriage has become a disadvantage for the shipping industry. In that regard, the regulation of deck cargo under the Rotterdam Rules could turn into a good model of how this aspect of shipping law can be modernized.³²²