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References
Nugent v. Smith (1875–76) L.R. 1 C.P.D.423.
Even if he exercised reasonable care; Shaw v. Symmons [1917] 1 K.B.799. Thus where a carrier parts with cargo without presentation of bills of lading, the cargo owners are entitled to claim in bailment despite the transfer of contractual rights to third party; East West Corp. v. DKBS 1912 [2003] 1 Lloyd’s Rep.239.
Common carriers could be taxi companies; Mizenchuk v. Thompson and Nash Taxi and U-Drive Co. [1948] 1 DX.R.136.
Bailhache, J., said, inter alia, that ‘to make a man a common carrier he must carry as a public employment; he must carry for all indifferently; he must hold himself out as ready to carry for hire as a business and not as a casual occupation’, in Belfast Ropework Co. Ltd. v. Bushell [1918] 1 K.B.210, 212. In this case D was a haulage contractor who carried sugar from Liverpool to Manchester. At Manchester D invited offers of goods of all kinds for carriage to Liverpool and other places, at charges varying with the state of his business. These offers he accepted or rejected according to the rate, route, and class of goods. D concluded a contract for C’s goods from Manchester to Liverpool, and C’s goods were damaged by fire during the carriage without D’s negligence. It was held that since he reserved to himself the right of accepting or rejecting offers of goods for carriage from Manchester to Liverpool he was not a common carrier of such goods and consequently not liable. Cf. A. Siohn & Company Ltd. and Academy Garments (Wigan) Ltd. v. R. H. Hagland & Son (Transport) Ltd. [1976] 2 Lloyd’s Rep.428, where it was stated by the Court that a common carrier does not lose his legal character because he limits the class of goods he is prepared to carry or the routes or areas over which he is ready to operate.
Webster (EJ) v. Dickson (F) Transport [1969] 1 Lloyd’s Rep.89.
Johnson v. Midland Railway (1849) 18 L.J.Ex.366.
Garton v. Bristol and ExeterRailway Co. (1861) 30 L.J.Q.B.273.
A. Siohn & Co. Ltd. v. RH Hagland & Son (Transport) Ltd. [1976] 2 Lloyd’s Rep.428
An Act of God would seem to include any accident arising without human intervention, which could not be reasonably foreseen and avoided; Nugent v. Smith (1875–76) L.R. 1 C.RD.423.
This exception seems to cover acts done by public enemies; Russell v. Niemann (1864) 34 L.J.C.R10.
Examples of inherent vice are spontaneous combustion, disease, decay or fermentation. ‘Vice’ means the ‘...sort of vice which by its internal development tends to the destruction or the injury of the animal or thing to be carried’; per Willes, J., in Blower v. Great Western Railway Co. (1872) L.R. 7 C.R655, 662. Inherent vice is the risk of deterioration of goods shipped as a result of their natural behaviour in the ordinary course of the contemplated voyage without the intervention of any fortuitous external accident or casualty; G.m.b.H. Mainz K.G. v. White [1983] 1 Lloyd’s Rep.122. TM Noten BV v. Paul Charles Harding [1990] 2 Lloyd’s Rep.283; Cf. Bird’s Cigarette Manufacturing Co. Ltd. v. Rouse (1924) 19 Ll. L. Rep.301. See s.55(2)(c), Marine Insurance Act 1906.
To exercise a degree of care and skill; Nugent v. Smith (1875–76) L.R. 1 C.RD.423.
See agency of necessity, supra, p. 136.
Morrison Steamship Co. Ltd. v. Greystoke Castle (Cargo Owners) [1947] A.C.265.
Whitecross Wire & Iron Co. Ltd. v. Savill (1822) 8 Q.B.D.653, C.A.; where most of the cargo had been discharged and a fire broke out on the ship. The remainder of the cargo was damaged by water used in putting out the fire. It was held that the shipowner must contribute in respect of this damage.
Shepherd v. Kottgen (1877) 37 L.T.618.
Papayanni & Jerinica v. Grampian Steamship Co. Ltd. (1896) 12 T.L.R.540.
The issue to consider is whether the party claiming contribution ‘has by his own fault, occasioned the peril which immediately gave rise to the claim’, per Watson, L.J., in Strang Steel & Co. v. A Scott & Co. (1889) 14 A.C.601, 608. U.S.A. law on the point is similar; United States v. Eastmount Shipping Corp. (1974) A.M.C.1183, cargo owners not liable to contribute where unseaworthiness was a proximate cause of the general average act.
Chellew v. The Royal Commission on Sugar Supply [1922] 126 L.T. 103.
See Hague-Visby Rules 1968, infra, p.271.
Lidgett v. Williams (1845) 14 L.J. Ch.459.
Per Blackburn, L.J., Rossiter v. Miller (1878) 3 A.C.1124, 1151.
Unless the shipowner and the charterer have agreed that such bills of lading will vary the terms of the charter-party; The Jocelyne [1977] 2 Lloyd’s Rep.121.
This is a general rule, and it is possible that the bill of lading incorporates the terms of the charter-party, in which case, depending on the particular charter-party terms incorporated, the charter-party terms may bind such third party transferee; President of India v Metcalfe Shipping Co. Ltd. (The Dunelmia) [1970] 2 Q.B.289, where the bills of lading were endorsed to by the sellers to the charterers and the bills stipulated ‘Freight payable by the charterers as per charterparty’ and ‘all conditions and exceptions as per charterparty’ but did not incorporate the charter-party’s arbitration clause. A dispute arose between charterers and shipowners over an alleged short delivery on discharge. The charterers sought to refer it to arbitration but the shipowners claimed that the matter was governed by the bills, which excluded arbitration. It was held by the Court of Appeal that the charter-party was prima facie the contract governing relations between the parties, unless expressly or impliedly altered by them; here the bills of lading had had no impact on the charterparty; so the arbitration clause in the charter-party remained effective. In Miramar Maritime Corp. v. Holborn Oil Trading (The Miramar) [1984] A.C.676, a tanker voyage charterparty in the standard form known as ‘Exxonvoy 1969’ was concluded, and the bill of lading purported to incorporate all the terms of the charter including a demurrage clause rendering the charterers liable for demurrage. The shipowners claimed that the demurrage clause thereby incorporated into the bill of lading rendered the consignees of the cargo, as holders of the bill of lading, directly liable for the demurrage incurred It was held that on the true construction of the bill of lading it was the intention of the parties to the bill of lading contract that the charterers alone should be liable for demurrage.
Hong Kong Fir Shipping Co. Ltd. v. Kawasaki Kisen Kaisha Ltd. [1962] 2 Q.B.26, C.A.
The shipowner undertakes responsibility for any defects even if these are not discoverable by careful examination; Steel v. State Line Steamship Co. (1877–78) L.R. 3 App. Cas.72, H.L.
Per Channell, J., in McFadden v. Blue Star Line [1905] 1 K.B.697, 706.
For example, if the vessel fails to take on sufficient fuel to the next port of call, she would be unseaworthy; The Vortigern [1899] P.140, C.A.
Owners of Cargo Laden on Makedonia v. Makedonia Owners (The Makedonia) [1962] 2 All E.R.614.
See for example, Moore v. Lunn (1922) 11 Ll. L. Rep.86, vessel unseworthy due to a drunken master and an unqualified engineer.
Robin Hood Flour Mills Ltd v. N.M. Paterson & Sons Ltd., (The Farrandoc) [1961] 2 Lloyd’s Rep.276 (Exchequer Court of Canada).
Rowson v. Atlantic Transport [1903] 2 K.B.666, vessel’s faulty refrigeration.
Cheikh Boutros Selim El-Khoury v. Ceylon Shipping Lines, Ltd., (The Madeleine) [1967] 2 Lloyd’s Rep.224, vessel not possessing deratisation certificate from health authorities, held vessel not fitted for ordinary cargo service.
Reardon Smith Line Ltd. v. Black Sea & Baltic General Insurance Co. Ltd. [1939] A.C.562, H.L.
Rio Tinto Co. Ltd. v. Seed Shipping Co. Ltd. (1926) 24 Ll. L. Rep.316.
But deviation is not justified to save property; Scaramanga & Co. v. Stamp (1879–80) L.R. 5 C.P.D.295, where a ship deviated to assist a vessel, and agreed to give her a tow. While towing the distressed vessel, she ran aground and was lost. It was held, inter alia, that the deviation to save the ship was not justified.
The Teutonia (1871–73) L.R. 4 P.C. 171.
Kish v. Taylor [1912] A.C.604, H.L.
However, such liberty clauses are strictly construed by the Courts Glynn v. Margetson & Co. [1893] A.C.351, H.L.
This area of law is not without difficulties. For example, it is not clear whether a deviating shipowner can rely on exclusion clauses for loss or damage to the goods which occurred before the deviation. In fact, even the proposition put forward here that a deviating shipowner’s position changes to that of a common carrier, has not been made satisfactorily clear by the Courts, e.g. see the view of Fletcher Moulton, L.J., in Joseph Thorley Ltd. v. Orchis Steamship Co. Ltd. [1907] 1 K.B.660, 669.
Morrison & Co. Ltd. v. Shaw Savill & Albion Co. Ltd. [1916] 2 K.B.783, C.A.
Thus, in E. Clement Horst Company v. Biddell Brothers [1912] A.C.18, H.L., a contract was made for the sale of hops to be shipped from the U.S.A. to the U.K. C.I.F. net cash. The buyer refused to pay for the goods until they were actually delivered. It was held that possession of the bill of lading is in law equivalent to possession of the goods, and that under a C.I.F. contract, the seller is entitled to payment on shipping the goods and tendering to the buyer the documents of title.
The transfer of a bill of lading transfers only such proprietary interest as the parties intend; Sewell v. Burdick [1884] 10 App.Cas.74, H.L., a shipper indorsed the bill of lading in blank to the bank as security for a loan. The carrier enforced his lien over the goods and auctioned them in order to recover freight. However, the auction’s proceeds were insufficient to meet the freight, and hence the carrier brought an action against the bank as holder and indorsee of the bill of lading. It was held that as the relationship between the shipper and the bank was not one of sale, no property had passed through the indorsement of the bill of lading, therefore the carrier was prevented from taking action against the bank. Cf. Lickbarrow v. Mason (1793) 126 E.R.511, H.L., goods had been bought by B, by a blank indorsement of a bill of lading. B sold the goods to C, who paid for them, and had the bill of lading transferred by B’s indorsement. Then B became bankrupt without having paid S, his seller. S sold the goods to D who obtained possession when the ship arrived. C claimed that he had title to the goods. It was held that since the bill of lading was delivered to B, the buyer, who had indorsed it for valuable consideration to a third party who acted in good faith, i.e. C, the property in the goods passed to that third party, i.e. C. Hence, the property was transferred with the documents to C, and S, the original seller, had no title to transfer to D.
See supra, pp.160 and 158 respectively.
Per Denning, M.R., in Sze Hai Tong Bank v. Rambler Cycle Co. Ltd. [1959] 2 Lloyd’s Rep. 114, 120. A carrier is entitled to refuse to deliver the goods without production of the bill of lading, even if the person requesting delivery is entitled to receive them; Truck & Spares Ltd. v. Maritime Agencies (Southampton) Ltd. [1951] 2 All E.R. 982, a number of trucks and spares were sold to a buyer in Canada. When the goods arrived, the buyer had no bills of lading because due to debts owed by the seller to the carrier, the seller had not received one, i.e. the carrier kept the bill of lading. It was held that the bill of lading must be produced to make a good title to the goods.
Owners of Cargo Lately Laden on Board the Ardennes v. Owners of the Ardennes (The Ardennes) [1951] 1 K.B.55; an oral contract of carriage was made between the shipper and the carrier. It was agreed that the ship should go directly to London in order to avoid an expected rise in import tax. However, the bill of lading subsequently issued allowed for deviation from the agreed route. In the event, the ship called at some other ports, and she arrived in London after the tax increase. It was held that as between shipper and carrier, a bill of lading is a receipt for the goods and excellent evidence of the terms of carriage but not the contract itself. The carriers were bound by the oral contract made.
Rudolph A Oetker v. IFA Internationale Frachtagentur AG (The Almak) [1985] 1 Lloyd’s Rep.557.
Procter & Gamble Philippine Manufacturing Corp. v. Kurt A. Becker GmbH & Co. [1988] 2 Lloyd’s Rep.21, C.A.
Standard Chartered Bank v. Pakistan National Shipping Corporation and Others (No.2) [2003] 1 Lloyd’s Rep.227, H.L.; here the shipper company, through its director, agreed with the shipowners that backdated bills of lading will be issued, in order to bring the shipment within the time limit of shipper’s letter of credit. Indeed, the company presented the bill of lading and other documents along with a letter by the company’s director stating that the submitted documents were all those required by the credit However, some of the documents were rejected as discrepant and re-submitted after the date for the negotiation of the credit had passed Despite this late presentation, C, the confirming bank, paid the shipper/beneficiary and sought to be reimbursed by the issuing bank. The issuing bank was unaware of the backdating of the bill of lading, but rejected some of the documents due to discrepancies which C had not noticed. C sued the shipper/beneficiary and the shipowners for deceit. It was held that the shipper/beneficiary company’s director could be held personally liable for fraudulent misrepresentation. So that C could pursue the claim against either the shipper/beneficiary company and/or its director personally. One of the interesting issues raised by the shipper/beneficiary’s director was that, should he be found personally liable for fraudulent misrepresentation, the claim should be reduced as a consequence of C’s contributory negligence (i.e. paying despite late presentation). However, the Court held that a reduction due to contributory negligence in any damages for fraudulent misrepresentation was not appropriate.
Such innocent party may, nevertheless, have a valid claim for any losses suffered as a result; Finlay v. Kwik Hoo Tong [1929] 1 K.B.400, the bill of lading had inaccurately stated that shipment had taken place within shipment period. The buyers accepted the documents without notice of the fact that the goods had been shipped outside this shipment period. Subsequently, the buyers entered into several sub-contracts, and some of their sub-purchasers refused to take delivery alleging that the goods did not meet their contractual description, i.e. shipment period It was held that the failure to tender genuine documents had deprived the buyers of their right of rejection which, in the circumstances (of a falling market), they would have exercised. Therefore the buyers were awarded damages to reflect the difference between the contract price and market price.
Empresa Cubana Importadora de Alimentos Alimport v. Iasmos Shipping Co. SA (The Good Friend) [1984] 2 Lloyd’s Rep.586.
Grand Champion Tankers Ltd. v. Norpipe A/S (The Marion) [1984] A.C.563, H.L.
Papera Traders Co. Ltd. v. Hyundai Merchant Marine Co. Ltd. (The Eurasian Dream) [2002] 1 Lloyd’s Rep.719.
Riverstone Meat Co. Pty Ltd. v. Lancashire Shipping Co. Ltd. (The Muncaster Castle) [1961] A.C.807, H.L.
The test of whether’ suit’ has validly commenced does not seem to be whether the correct claimant commenced proceedings before a competent Court against the correct defendant, within the one year limit of the Rules; Thyssen Inc. v. Calypso Shipping Corp. SA [2000] 2 Lloyd’s Rep.243, where under a charter-party governed by English law and the Hague Rules and containing a London arbitration clause, the cargo owners, in breach of the arbitration clause, commenced an action for damage to their goods, in the U.S.A. Their action in the U.S.A. stayed, and they subsequently wished to commence an arbitration claim. The carrier sought to rely on the time bar in the second set of proceedings. It was held, that as the cargo owners’ action in the U.S.A. stayed by reason of the breach of the arbitration clause, no suit had been brought within the year. Therefore, the arbitration proceedings were time-barred.
Article IV, rule 5(e), Hague-Visby Rules 1968.
National Petroleum Co. v. Owners of the Athelviscount (1934) 48 Ll. L. Rep.164; where the Court clearly stated that ‘condition’ in this context means external and apparent condition and not ‘quality’ which is not usually apparent to an unskilled person. Furthermore, it was stated that bills of lading containing the statement ‘weight, quantity and quality unknown’ do not constitute any representation as to quality of the goods shipped.
‘A statement that the goods were supplied in good order and condition estops the shipowner as against the person presenting the bill of lading to get delivery of the goods from proving that the goods were not in apparent good order and condition when shipped’, per Branson, J., in National Petroleum Co. v. Owners of the Athelviscount (1934) 48 Ll. L. Rep. 164, 170.
Monarch Steamship Co. Ltd. v A/B Karlshamns Oljefabriker [1949] A.C.196, H.L.
Section 16, Sale of Goods Act 1979 (as amended).
See The Delfini [1990] 1 Lloyd’s Rep.252.
Section 1(3), Carriage of Goods by Sea Act 1992.
Article 2(1)(b), Hamburg Rules 1978.
Article 2(3), Hamburg Rules 1978.
Provided such carriage has been agreed or it is in accordance to the usage of the particular trade; Article 9(1), Hamburg Rules 1978.
Article 5(5), Hamburg Rules 1978.
This means ‘any contract whereby the carrier undertakes against payment of freight to carry goods by sea from one port to another’; Article 1(6), Hamburg Rules 1978.
Article 5(1), Hamburg Rules 1978.
Article 20(1), Hamburg Rules 1978.
Article 19(1), Hamburg Rules 1978.
Article 19(2), Hamburg Rules 1978.
Article 6(1)(a), Hamburg Rules 1978.
Article 8(1), Hamburg Rules 1978.
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(2006). Carriage of Goods by Sea. In: Principles of Law Relating to International Trade. Springer, Boston, MA. https://doi.org/10.1007/0-387-30699-4_12
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