Carriage of Goods by Sea From Hague To R PDF

CARRIAGE OF GOODS BY SEA – FROM HAGUE TO
ROTTERDAM: SAFER WATERS
By
DENNING N. METUGE
Submitted in fulfilment of the requirements for the

award of the degree of
MAGISTER LEGUM
(MERCANTILE LAW RESEARCH)
In the Faculty of Law at the
NELSON MANDELA METROPOLITAN UNIVERSITY
Supervisor: Mr SP NEWMAN
January 2012
i
DECLARATION
I, Metuge Denning Ngomele, student number S210113375, In accordance with Rule G4.6.3,
hereby declare that CARRIAGE OF GOODS BY SEA – FROM HAGUE TO ROTTERDAM: SAFER
WATERS is my own work and that it has not previously been submitted for assessment or
completion of any postgraduate qualification to another University or for another
qualification.
METUGE DENNING NGOMELE
ii
ACKNOWLEDGEMENTS
I am very grateful to my promoter Mr Stephen Peter Newman for his efforts in supervising
this research.
I also wish to express my sincere gratitude to Professor Patrick HG Vrancken for his
assistance with the structural development of this research despite his busy schedule.
Also I wish to say special thank you to Miss Dawn Prinsloo, you are amazing at your job,
thank you for assistance with retrieving relevant articles for my research.
To my family, I have no words to express how grateful I am to have you. Your trust love and
prayers kept me going when I thought I couldn’t. I love you all so much.
To my friends whom I hold close to my heart, having you during this period made me a
better person. In this light, I say thank you to Nnane Roland, Felix Nzante, Gilbert, Akale
Namondo, Harold Rupapa, and all those whom I haven’t mentioned, thank you for being
there for me.
Above all, I wish to say thank you Lord Jesus, for it is by your Grace that I made it this far in
life. Thank you for the wonderful people you have brought into my life.
iii
SUMMARY
The back bone of international trade has always been international transport.
Without good transport networks, the movement of goods and services from one frontier to
another would be an uphill task, and would greatly hinder development in international
trade. The impact of such poor transport networks would reflect negatively on economies
that rely on international trade for the growth of their nations. Nevertheless, perfect
transport networks would be useless if the performance of the business of carriage was not
regulated by a law developed to meet the standards established by time, and that would
regulate the relationship of the parties under contracts of carriage, mainly the carrier,
consignor and consignee, so as to ensure certainty and equality in the allocation of risks
between the parties thereunder.
This research focuses on the carriage of goods by sea. Like most other modes of
transport, one of the major issues that arises in the business of carriage of goods by sea is
the conflict between the carrier, consignor and consignee, with regards to the allocation of
risk in the carriage. Over the years, early rules that were developed to regulate the
relationship of the parties under contracts of carriage of goods by sea placed the carrier in a
dominant position over the consignor. The carrier issued a standard bill of lading which
exempted him from almost all liability for damage or loss of the goods in his care.
The consignors and bona fide third parties, not satisfied with the terms of carriage
contracts brought a lot of pressure to bear on their governments to enact legislation
protecting their interests in the transaction. The United States of America were the first to
pass such national law revising the position of the parties under contracts of carriage. In
1893 the United States of America passed the Harter Act. This Act aimed at imposing limits
of liability on the carrier to which no derogation could be brought. However, this was a
dangerous precedence which was going to hinder international trade rather than improve
on it, as different nations developing local legislation on carriage meant conflict of laws.
In order to avoid the extensive nationalisation of carriage laws, the international

maritime community set to develop rules that would regulate carriage by sea. Over the
years convention has succeeded convention such that today four international regimes (The
Hague Rules, Hague-Visby Rules, Hamburg Rules and Rotterdam Rules), exist regulating
carriage of goods by sea. This research takes an in-depth look at these regimes that were
developed to regulate carriage by sea, and the author aims to identify a particular regime
that meets the standards of modern day practice of carriage of goods, and advocate for the
ratification of this regime, to the exclusion of all others so as to foster uniformity, certainty
and equality in the business of carriage of goods by sea.
iv
TABLE OF CONTENT
DECLARATION……………………………………………………………………………………………………………….…….ii
ACKNOWLEDGMENTS…………………………………………………………………………………………………….…………….iii
SUMMARY................................................................................................................................iv
CHAPTER ONE: INTRODUCTION ............................................................................................ 1

1.1 BACKGROUND ................................................................................................................ 1
1.2 DEFINITION OF THE PROBLEM ....................................................................................... 4
1.3 RESEARCH QUESTION .................................................................................................... 7
1.4 AIM AND OBJECTIVES .................................................................................................... 7
1.5 RESEARCH METHODOLOGY ........................................................................................... 8
1.6 CONTRACTS OF SALE AND THE INCIDENCE OF CARRIER LIABILITY UNDER
CONTRACTS OF CARRIAGE BY SEA ................................................................................. 9
1.6.1 NATURE OF THE CONTRACT OF SALE ............................................................................ 9
1.6.2 C.I.F CONTRACTS .......................................................................................................... 10
1.6.3 F.O.B CONTRACTS ........................................................................................................ 11
1.6.4 TYPES OF CARRIAGE CONTRACTS ................................................................................ 12
1.6.5 WHY INTERNATIONAL REGULATION? .......................................................................... 14
1.7 THE BILL OF LADING AND PERFORMANCE OF THE CONTRACT OF CARRIAGE ............ 15
1.7.1 BILL OF LADING AS RECEIPTS ....................................................................................... 16
1.7.2 THE BILL OF LADING AS EVIDENCE OF THE CONTRACT OF CARRIAGE ........................ 17
1.7.3 THE BILL OF LADING AS DOCUMENT OF TITLE ............................................................ 17
1.7.4 PERFORMANCE OF THE CONTRACT OF CARRIAGE ...................................................... 18
1.8 FREIGHT .................................................................................................................... 21
CHAPTER TWO: CARRIERS’ LIABILITY UNDER ENGLISH COMMON LAW ............................ 23

2.1 INTRODUCTION ............................................................................................................ 23
2.2 DUTIES OF THE CARRIER AT COMMON LAW ............................................................... 24
2.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP ..................................................................... 24
2.2.2 DUTY TO PROCEED WITH DUE DISPATCH .................................................................... 27
v
2.2.3 DUTY NOT TO DEVIATE ................................................................................................ 27
2.2.4 DUTY TO TAKE REASONABLE CARE OF THE GOODS .................................................... 29
2.2.5 DUTY TO DELIVER GOODS TO A NAMED OR IDENTIFIABLE PERSON........................... 29
2.3 COMMON LAW EXCEPTIONS FROM LIABILITY ............................................................ 31
2.3.1 ACTS OF GOD ............................................................................................................... 31
2.3.2 ACT OF THE QUEEN’S ENEMIES ................................................................................... 31
2.3.3 INHERENT VICE............................................................................................................. 31
2.3.4 FAULT OR FRAUD OF CONSIGNOR ............................................................................... 32
2.4 LIMITATION OF CARRIER LIABILITY AT COMMON LAW ............................................... 32
2.4.1 PERILS OF THE SEA ....................................................................................................... 32
2.4.2 ARREST OR RESTRAINT OF PRINCES............................................................................. 33
2.4.3 STRIKES .................................................................................................................... 34
2.4.4 FIRE .................................................................................................................... 35
2.4.5 NEGLIGENCE AND NAVIGATIONAL ERRORS ................................................................ 35
2.5 CONCLUSION ................................................................................................................ 36
CHAPTER THREE: CARRIERS’ LIABILITY UNDER THE HAGUE/HAGUE VISBY
REGIMES………………………………………………………………………………………...40
3.1 INTRODUCTION ............................................................................................................ 40

3.2 DUTIES OF THE CARRIER UNDER THE HAGUE-VISBY RULES ........................................ 44
3.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP ..................................................................... 45
3.2.2 DUTY TO CARE FOR THE CARGO .................................................................................. 48
3.2.3 DUTY TO ISSUE THE BILL OF LADING ........................................................................... 49
3.2.4 DUTY NOT TO DEVIATE ................................................................................................ 50
3.3 EXEMPTIONS TO CARRIERS’ LIABILITY UNDER THE HAGUE-VISBY RULES: .................. 52
3.3.1 NEGLIGENCE IN NAVIGATION OR MANAGEMENT OF THE SHIP ................................. 52
3.3.2 FIRE .................................................................................................................... 53
3.3.3 PERILS OF SEA .............................................................................................................. 54
3.3.4 ACT OF GOD ................................................................................................................. 55
3.3.5 ACT OF WAR, PUBLIC ENEMIES AND RIOT ................................................................... 55
3.3.6 ACT OF AUTHORITIES AND QUARANTINE.................................................................... 55
3.3.7 ACT OR OMISSION OF THE CONSIGNOR ...................................................................... 56
vi
3.3.8 STRIKES AND LOCKOUTS .............................................................................................. 56
3.3.9 SAVING LIFE OR PROPERTY AND DEVIATION............................................................... 56
3.3.10 WASTAGE AND INHERENT VICE ................................................................................... 57
3.3.11 DEFECTIVE PACKING AND MARKING ........................................................................... 57
3.3.12 LATENT DEFECTS .......................................................................................................... 58
3.3.13 CATCH ALL EXEPTION ................................................................................................... 58
3.4 LIMITATION OF CARRIERS’ LIABILITY UNDER THE HAGUE-VISBY RULES ..................... 59
3.4.1 FINANCIAL LIMITATION................................................................................................ 60
3.4.2 TIME LIMITATION ......................................................................................................... 60
3.5 CONCLUSION ................................................................................................................ 61
CHAPTER FOUR: CARRIERS’ LIABILITY UNDER THE HAMBURG RULES AND REASONS
FOR THEIR FAILURE .................................................................................... 63
4.1 INTRODUCTION…………………………………………………………………………………………………..63
4.2 MAJOR CHANGES BROUGHT TO THE HAGUE-VISBY RULES BY THE HAMBURG
RULES..........................................................................................................................65
4.2.1 SCOPE OF APPLICATION ............................................................................................... 65
4.2.2 CARRIER’S DOCUMENTARY RESPONSIBILITY ............................................................... 68
4.2.3 LIABILITY OF THE CARRIER UNDER THE HAMBURG RULES.......................................... 68
4.2.4 EXCEPTIONS TO CARRIER LIABILITY UNDER THE HAMBURG RULES ............................ 70
4.2.5 LIMITATION OF LIABILTY UNDER THE HAMBURG RULES ............................................ 71
4.2.6 FINANCIAL LIMITATION................................................................................................ 71
4.2.7 TIME LIMITATION ......................................................................................................... 72
4.3 WHY HAVE THE HAMBURG RULES FAILED?................................................................. 73
4.4 CALL FOR A NEW CONVENTION ................................................................................... 75
CHAPTER FIVE: THE ROTTERDAM RULES ............................................................................ 76

5.1 DEVELOPMENTS INTRODUCED BY THE ROTTERDAM RULES....................................... 76
5.1.1 SCOPE OF APPLICATION ............................................................................................... 76
5.1.2 DOCUMENTARY REQUIREMENTS ................................................................................ 78
5.1.3 LIABILITY OF THE CARRIER UNDER THE ROTTERDAM RULES ...................................... 79
5.1.4 EXCEPTIONS FROM LIABILITY UNDER THE ROTTERDAM RULES.................................. 82
5.1.5 LIMITATION OF LIABILITY UNDER THE ROTTERDAM RULES ........................................ 83
vii
CHAPTER SIX: CONCLUSION .............................................................................................. 84
6.1 RECOMMENDATION .................................................................................................... 84
BIBLIOGRAPHY .................................................................................................................... 89
BOOKS .................................................................................................................... 89
JOURNAL ARTICLES & INTERNET SOURCES.............................................................................. 89
INTERNATIONAL CONVENTIONS .............................................................................................. 94
THESIS .................................................................................................................... 94
LEGISLATION .................................................................................................................... 94
LIST OF CASES .................................................................................................................... 95
viii
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
For centuries carriage of goods by sea has been a common practice employed by
merchants. International transport is the pivot around which international trade revolves; it
provides the material platform without which international trade would be impracticable.
More often than not, the first thing that comes to mind when mention is made of
international transactions is the relationship between the buyer and the seller. However,
the key player in this transaction is the carrier. Study of the carrier is important to
international trade as it is not only the physical link between the consignor and consignee
but also the legal link between both of them.1
The first rules that governed carriage by sea were a creation of the international
merchant. 2 Merchants, in order to ease the nature of their trade, entrusted their goods to
carriers under mutual agreements. It was not long before these mutual agreements became
standardized and accepted as the basis of customary regulation in the practice of carriage of
goods, and were eventually incorporated into common law rules.3 The carriers’ liability
under English common law 4 was strict; it was liable for loss or damage to cargo in its
possession even if it took all measures to avoid such loss or damage, unless it could prove
that the loss or damage was caused by one of the following four excepted perils; loss or
injury caused by an act of God, or by the Queen's enemies; the consequence of an inherent
vice in the thing carried; or as a result of the consignor's own fault.5 More so, the carrier
would not escape liability even if the loss or damage was caused by one of the four
excepted perils if the consignor could prove that the loss or damage resulted from either the
carrier’s negligence or that of its agents.6
In order to nip in the bud a growing trend by the carrier to exempt itself from liability
by agreement under contract, the British courts introduced a new doctrine which imposed
on the carrier the duty to provide a seaworthy vessel for the carriage. Where the consignor
could prove that the carrier failed to render his vessel seaworthy, the carrier was liable for
1
Booysen H Principles of International Trade Law As A Monistic System (2003) 616.
2
Supra 617.
3
Zamora S “Carrier Liability for Damage or Loss to Cargo in International Transport” 1975 (23) American
Journal of Comparative Law 396 http://www.jstor.org/stable/839373(Accessed: 26/07/2011).
4
Future references to the common law in the course of this research shall be the English common law, unless
otherwise specified.
5
Zamora American Journal of Comparative Law 397 http://www.jstor.org/stable/839373.
6
Gilmore G and Black CL The Law of Admiralty (1957) 119 in Zamora S “Carrier Liability for Damage or Loss to
Cargo in International Transport” 1975 (23) American Journal of Comparative Law 398
http://www.jstor.org/stable/839373.
1
loss or damage to the cargo even if the loss or damage was caused by one of the four
excepted perils or by a contractually excepted cause. 7
In the 19th century, development of efficient steam power caused shipping

companies and railroads to expand rapidly in size and economic strength. Due to a lack of
competition in land and sea transport, the carriers' commercial position with regards to the
consignors was greatly strengthened. The liberty awarded by law to the carrier and
consignor to determine the terms of the contract of carriage resulted in sea carriers’
introducing a series of exclusionary clauses in the bills of lading. The carriers used their
freedom of contract to exclude themselves, by agreement with the consignors, from the
strict liability imposed on them under common law for loss or damage to the goods in its
custody. These exclusionary terms were not only extensive (by 1921, the date the Hague
Rules were conceived, there were 55 such exclusionary clauses), 8 but became commonly
recognised in international transport to the disadvantage of the consignor. As a matter of
fact, the exclusionary terms were so absurd and endless that it was believed that the carrier
had no obligation but the collection of freight.9
The resulting imbalance in the relationship between the carrier and the consignor,
coupled with the abusive tendencies of the carrier, led to states developing national
legislation to protect the consignor by limiting the carriers endless list of exceptions to
liability. The United States of America spear-headed this campaign by the passing of the
Harter Act in 1893. It was not long before other developed nations followed suit. The Harter
Act was followed by the Australian Sea Carriage of Goods Act of 1904 and the Canadian
Carriage of Goods by Water Act of 1910.10 Unfortunately these initiatives had the effect of
making the bill of lading valid in one area but not in another due to the difference in
national laws and their application in different territories. This was a major problem as
international trade by its very nature relates to trade that transcends international borders.
It hence goes without saying that there was a need for uniformity in international laws
regulating liability under contracts for the carriage of goods by sea. 11
The first attempt at international uniformity resulted in the adoption of the Hague
Rules in 1921. 12 The Hague Rules were aimed at establishing a minimum mandatory liability
on the carrier to which no exclusions could be made. Adherence to the Hague Rules was
however elective, and accordingly, it failed to produce the desired redress to the problem
7
8 th
Knauth AW The American Law of Ocean Bills of Lading 4 ed (1953) 120, in Zamora S “Carrier Liability for
Damage or Loss to Cargo in International Transport” 1975 (23) American Journal of Comparative Law 401
http://www.jstor.org/stable/839373.
9
James FC “The Carriage of Goods by Sea. The Hague Rules” 1926 (74) University of Pennsylvania Law Review
and American Law Register 672 674-675 http://www.jstor.org/stable/3313985. (Accessed: 05/10/2010).
10
Wanigasekera A “Comparison of Hague-Visby and Hamburg Rules” 1
http://www.scribd.com/doc/59734937/Comparison-of-Hague-and-Hamburg-AW (Accessed: 13/08/2011).
11
Booysen H International Transactions and the International Law Merchant (1995) 248 herein after referred
to as Booysen (a).
12
Booysen Principles of International Trade Law 621.
2
faced by consignors as carriers did not adopt it. In this light, and with the support of the
International Convention for the Unification of Certain Rules of Law Relating to Bills of
Lading,13 a diplomatic conference was held at Brussels, in 1924 which adopted the
convention as international law, thus rendering the provisions of the convention binding on
the carriers of the states that ratify it. The 1924 Hague Rules were readily ratified by the
English in the Carriage of Goods by Sea Act 1924, and later on the by French and the United
States in 1936. A great number of the world’s shipping nations have adhered to the
provisions of the Hague Rules ever since. However, the defenses and limitation to carriers’
liability prescribed under the Hague Rules were seen as too pro-carrier, and did not extend
to loss or damage caused by agents of the carrier, thereby straining the litigation process.
More so, the provisions were deemed inconsistent with developments in the shipping
industry such as the use of containers in transport, thus making the amendments to the
Hague Rules necessary. 14
The provisions of the Hague Rules were revised in Brussels by the Protocol to Amend
the International Convention for the Unification of Certain Rules of Law Relating to Bills of
Lading in 1968, which was called the Visby Protocol. This Protocol and the Hague Rules
were, from 1968, to be read together as one single instrument known as the Hague-Visby
Rules. The provisions of the Hague-Visby Rules were incorporated into South African Law by
virtue of the Carriage of Goods by Sea Act 1 of 1986. 15
The Hague-Visby Rules continue to accommodate the excessive exclusionary terms

present under the Hague Rules. 16 More so, in drafting the Hague-Visby Rules, the African
nations and some developed nations were not consulted, which led to a feeling amongst
them that the new rules were designed to favour the industrialised nations and their ship
owners. 17 Thus, the United Nations Conference on the Carriage of Goods at Sea was held at
Hamburg in 1978, and adopted the United Nations Convention on the Carriage of Goods by
Sea 1978. This convention is known today as the Hamburg Rules, and has the aim of
replacing the Hague-Visby Rules in the regulation of carriage by sea. Unfortunately,
scepticism towards the ratification of the Hamburg Rules by major shipping nations led to its
‘failure’, and the adoption of a new regime today known as the United Nations Convention
on Contracts for the International Carriage of Goods Wholly or Partly by Sea (The Rotterdam
Rules).
13
A UN convention aimed at revising the provisions regulating the relationship of parties under the bill of
lading.
14
Zamora American Journal of Comparative Law 405-419 http://www.jstor.org/stable/839373.
15 nd
Hare Shipping Law & Admiralty Jurisdiction in South Africa 2 (2009) 324-325.
16
Pravin SVR “The Lawyer’s World: The Hamburg Rules, Failure or Success?” 2011
http://pravinrathinam.blogspot.com/2011/06/hamburg-rules-failure-or-success-review.html (Accessed:
13/08/2011).
17
Sinha B “Introduction: Origins of the 1978 Hamburg Rules” 1979 (27) American Journal of Comparative Law
Unification of International Trade Law: UNCITRAL's First Decade 353-354
http://www.jstor.org/stable/840038 (Accessed: 26/07/2011).
3
International Trade involves the flow of goods and services across national
frontiers.18 The economics of international trade play a crucial role in the shipping industry.
A flourishing nation will produce surplus goods for export, and secures foreign exchange
with which to buy imports. Should the economy of any nation suffer, this drop will reflect in
the volume of cargo carried on their ships serving foreign ports. This transaction does not
only affect the economics of shipping but the legal domain as well. 19 Many parties have a
role to play in such a transaction in order for it come to a favourable end, thus this work will
look at the major laws regulating carriage of goods by sea with main interest on how the
carriers’ limitation of liability has developed (under English common law, Hague/Hague-
Visby Rules, Hamburg Rules and recently, the Convention on Contracts for the International
Carriage of Goods Wholly or Partly by Sea, commonly referred to as the Rotterdam Rules) to
establish equality in the allocation of risks and strike a balance between the consignor and
the carrier. In another connection, given that the first international instruments that were
developed to regulate carriage by sea were based on the bill of lading, the author will briefly
discuss the bill of lading, as the multiplicity of its role in the contract of carriage makes it a
cardinal document for carriage of goods by sea.20 Through trade usage, the bill of lading is
not only seen as evidence of a contract of carriage by sea, but it is deemed to be the
contract itself. 21
The author reaffirms that development of laws regulating carriers’ liability under
contracts of carriage by sea is vital to the development of international trade, as in maritime
judicial practice most cases involve disputes concerning liability for loss of, or damage to
goods in the carriers’ care. 22
1.2 DEFINITION OF THE PROBLEM

The major problem that has emerged over the years, and which has plagued
international maritime activity, has been the resolution of disputes and the equitable
allocation of risks amongst the carrier, consignor, consignee/other third parties interests.
This is an issue that cannot be overlooked because predictability, certainty and stability are
the foundations of international trade and maritime commerce.23 The necessity for the
development of international rules of uniform application has been recognised by both civil
and common law lawyers. Plinio Manca, a civil law lawyer stated that:
18
Booyson Principles of International Trade Law 616.
19
Hare Shipping Law & Admiralty Jurisdiction 570.
20
Supra 688.
21 rd
Chuah JT Law of International Trade 3 ed (2005) 211.
22
Selvig E “The Hamburg Rules, the Hague and Maritime Insurance Practice” 1981 (12) Journal of Maritime
Law and Commerce 299-325 323 Sabinet (Accessed: 24/1012011).
23
Makins B “Uniformity of the law of the carriage of goods by sea in the 1990s: The Hamburg Rules -a
casualty” 1991 (8) MLAANZ 34-35
https://maritimejournal.murdoch.edu.au/archive/vol_8/1991vol8part1makins.pdf (Accessed: 15/ 08/2011).
4
“maritime trade having an international character, the logical corollary flowing from
this truth is that the ideal legal system to govern it be a uniform one that is identical
in every State. . .” 24
In the same vein Lord Diplock, a common law lawyer, in his Summation delivered at the
conclusion of the Colloquium on the Hamburg Rules held by the Comité Maritime
International (CMI) 25 in Vienna in 1979, referred to the initiatives undertaken by the CMI
since its foundation almost 100 years ago to promote uniformity in maritime law. In his
words: 26
“not uniformity for its own sake, but uniformity which will facilitate international
trade, reduce the costs of sea transport and what is equally important if trade is to
be carried on successfully, will bring as much certainty into it as possible so that
those taking part in it know where they stand, what obligations they have to fulfil
and what risks they run. We are concerned with uniformity of application as far as
possible throughout the trading world and that means that the same facts ought to
give rise to the same consequences in all the different jurisdictions in which the
matter may fall to be decided by the courts.” 27
Tremendous efforts have been put in by the CMI, and the United Nations
Commission on International Trade Law, 28 to develop international laws on sea carriage that
would provide uniformity in application and establish equality between the carrier,
consignor and consignee. Unfortunately, in as much as these laws have attempted to
resolve the imbalance in bargaining power and establish certainty in the nature of the
transaction, they have culminated in greater conflict as today four regimes 29 regulate sea
transport. The Hamburg Rules, predecessor to the Rotterdam Rules, which were expected to
be the panacea of these maritime crises, so far seem to have failed to achieve the aims of
UNCITRAL. Instead of replacing the Hague/Hague-Visby regimes, all regimes now exist
parallel to one another. It is opined that The Hamburg Rules, although highly favourable to
the consignor and consignee, have created greater disparity in the application of the law as
only 6% of the world’s shipping nations have ratified them,30 and none of these nations
include the major shipping countries. As such, instead of two conventions as obtained
24
Makins 1991 MLAANZ 35.
25
The CMI was formally established in 1897, and is the oldest international organization in the maritime
field.The Comité was the first international organization concerned exclusively with maritime law and
related commercial practices.
26
Makins 1991 MLAANZ 35-36.
27
This statement is a reference to the argument advanced by some proponents of the Hamburg Rules that
those Rules are to be preferred because they assimilate the rules of carriage of goods by sea to the rules of
international conventions relating to carriage by other modes of transport.
28
Hereinafter referred to as UNCITRAL. UNCITRAL is the core legal body of the United Nations system in the
field of international trade law. It is a legal body with universal membership specializing in commercial law
reform worldwide for over 40 years. UNCITRAL's business is the modernization and harmonization of rules
on international business.
29
The Hague, Hague-Visby, Hamburg Rules and Rotterdam Rules.
30
Pravin 2011 http://pravinrathinam.blogspot.com/2011/06/hamburg-rules-failure-or-success-review.html.
5
before 1978, international merchants have to deal with three conventions, which go a long
way to create greater antagonism towards the Hamburg Rules, as their opponents contend
that their adoption will increase uncertainty in the transaction and also more litigation than
before. This greatly influenced the adoption of the new regime, the Rotterdam Rules.
The author asserts that, in order to sustain global economic growth and
development, it is essential that the parties in international transport transactions be
awarded adequate protection with respect to their stakes in any transaction. Not only does
the consignor need protection as he has legal and financial interest in the goods as his
property, but also the consignee/buyer who pays for the property in such goods to be
passed to him. 31 In a nutshell, from an analysis of the provisions of the Hague/Hague-Visby
regimes, the author purports that, the possibility that the carrier could exempt himself by
agreement from liability for loss or damage to the cargo, coupled with the lack of uniformity
in the interpretation of these exclusionary clauses in different jurisdictions worldwide,
suggests a lack of necessary incentive on the part of the carrier to handle the cargo with
utmost care. More so, there is not enough certainty in the likely outcome of any litigation
against the carrier.
Be that as it may, aware of the eminent failure of the Hamburg Rules merely four
years after its coming into force, UNCITRAL, in its pursuit of developing rules of law that
would promote uniformity and certainty in the business of international trade, and carriage
of goods by sea in particular, 32 started working on a draft instrument on carriage of goods
wholly or partly by sea that could meet the desired outcome. 33 The author thus
recommends the ratification of an international regime that will ensure certainty and
equitability in the application of the rules governing carriage by sea; The Rotterdam Rules.
The Rotterdam Rules are the result of Ten years of intense work by UNCITRAL. It is
designed to apply to all contracts of carriage with an international carriage by sea leg
involved. Nevertheless, although highly anticipated to promote certainty and predictability
in the transport sector, the Rotterdam Rules have not come to existence without fears
expressed that an increase in the limits carrier liability may yield similar results as the
Hamburg Rules-failure.34
Although parties to a contract of carriage are at liberty to choose the law they wish
to bind them, this does not imply a solution to the problem. The consignor, who more often
than not is commercially inferior, is handed a standard-form contract issued by the carrier.
31
Section 20 of the UK Sale of Goods Act 1979.
32
Honnold J “The United Nations Commission on International Trade Law: Mission and Methods” 1979 (27)
American Journal of Comparative Law 201-211 http://www.jstor.org/stable/840026 (Accessed: 29/08/2011
05:50).
33
Pallarés LS“A Brief Approach to The Rotterdam Rules: Between Hope and Disappointment” 2011 (42) Journal
of Maritime Law & Commerce 453-463 455
http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=66465323&site=ehost-live (Accessed:
17/11/2011).
34
Pallarés 2011 Journal of Maritime Law & Commerce 453
http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=66465323&site=ehost-live.
6
The consignor may have limited or no knowledge of the elected rule binding it in contract,
but yet be compelled to proceed with the agreement due to other considerations.35 In this
situation, should the consignor suffer any prejudice such as loss or damage to cargo, where
the elected law governing the contract enables the carrier to include an inexhaustible list of
exceptions to its liability under the contract of carriage, the consignor is likely not be able to
claim adequate compensation from the carrier for loss or damage to the cargo.
1.3 RESEARCH QUESTION

To what extent have international regimes (such as the English common law, Hague,
Hague-Visby, Hamburg Rules and Rotterdam Rules) developed so as to impose minimum
standards of liability on the carrier and regulate the relationship between the carrier,
consignor and consignee, or any bona fide third party with a claim, in order to establish
uniformity and certainty in the application of rules governing carriage of goods by sea?
1.4 AIM AND OBJECTIVES

It has been suggested that the continued application of the Hamburg Rules by
minority shipping nations does not favour the international community. This argument is
based on grounds such as, that it creates greater disparity in the application of rules
governing sea carriage, and will result in greater uncertainty than before, and will also cause
a considerable increase in maritime litigation thus hindering global economic development.
The author’s position is that the Hamburg Rules, from a practical point of view, provide a
major improvement to carriage by sea, in terms of certainty and equitable allocation of risks
over the Hague regime. However, the author sees a champion of maritime law in the recent
Rotterdam Rules, and concurs with other authors that the adoption of the Rotterdam Rules
by the maritime community is clear indication that their aim to develop a maritime regime
geared primarily at establishing a balance in the allocation of obligations and liability
between the parties involved in carriage transactions has been achieved. 36 Hence, this
research will establish an evolutionary map of the laws that were developed over the years
to regulate carriage by sea; show the impact of these laws on the relationship between the
carrier, consignor, consignee and any bona fide third party; advance reasons for the failure
of the Hamburg Rules, and conclude by advocating for the ratification of the Rotterdam
Rules as the most effective tool developed so far to regulate carriage by sea.
35
'Gbenga B “Transnational Law, Unification and Harmonization of International Commercial Law in Africa”
Journal of African Law (38)1994 125 129 http://www.jstor.org/stable/745391 (Accessed: 13/08/2010 05:39).
36
Mukherjee PK & Bal AB “A Legal and Economic Analysis of the Volume Contract Concept under the
Rotterdam Rules: Selected Issues in Perspective” 2009 (40) Journal of Maritime Law & Commerce 579-607
605 http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=47882772&site=ehost-live.
7
1.5 RESEARCH METHODOLOGY
This study will make use of sources with relevant information to the development
laws regulating carrier’s liability. This will be obtained from a documentary analysis of books
describing the nature and performance of the contract of carriage, articles relating to
contracts of carriage of goods and conflicts in the relationship between the parties thereto.
In addition, the author will look at the English common law and international conventions
relating to contracts for the carriage of goods and its performance such as the Hague-Visby
Rules; the Hamburg Rules, and the Rotterdam Rules, in order to outline the scope of the
carriers’ liability under contracts of carriage, and how the application of these rules
contribute to establish certainty and equality between the carrier, consignor and consignee.
The researcher has easy access to relevant literature which is readily available nationally
from libraries at universities in South Africa which are rich not only in text books on
international trade law, but also journals and articles on carrier liability, not forgetting the
available online databases such as EBSCOHOST, LEXIS NEXSIS ACADEMIC, SABINET and the
World Wide Web, from which a lot of international journals and articles addressing
limitation of carriers’ liability can be obtained with ease.
This work is divided into 6 chapters. The first chapter sets a background to the study,
with a summary of the rules that were developed over time to regulate carriage of goods by
sea and identifies a crucial problem that affects the performance of the contract of carriage.
This chapter discusses sales contracts, as well as a contract for the carriage of goods by sea
and the role of the bill of lading. It describes the nature of the contract of sale, especially CIF
and FOB contracts, and how these affect the relationship between the consignor, consignee
and the carrier, and the incidents of liability under the contract of carriage of goods by sea.
This chapter further identifies the types of contracts of carriage by sea, and bills of lading to
which the various rules apply, and describes the performance of a contract of carriage by
sea and the terms under which remuneration for the carriage of good by sea is earned.
Chapter Two focuses on the liability of the carrier under English Common law, the
presumption of liability imposed on the carrier, the defences to such liability provided under
the Common law, and the exceptions incorporated into the contract of carriage by the
carrier in a bid to limit its liability. Chapter Three introduces the Hague/Hague-Visby
regimes, identifies the numerous defences awarded to the carrier under these regimes and
the limits of liability there under. In chapter Four the author presents the Hamburg Rules,
the main provisions of the Hague/Hague-Visby regimes it sort to redress, and also outlines
the major developments brought about by the Hamburg Rules in the transport industry. This
chapter also introduces the Rotterdam Rules. Chapter Five follows with an outline of
changes introduced by the Rotterdam Rules in the business of maritime carriage. The author
concludes this study in chapter Six with a brief discussion on the development of law on
transport by sea, and arguments in favour of the ratification of the Rotterdam Rules.
8
1.6 CONTRACTS OF SALE AND THE INCIDENCE OF CARRIER
LIABILITY UNDER CONTRACTS OF CARRIAGE BY SEA
1.6.1 NATURE OF THE CONTRACT OF SALE
The United Nations Convention on Contracts for the International Sale of Goods
37
(CISG), does not define a contract of sale but however, it provides that contracts for the
supply of goods to be manufactured or produced are to be considered sales unless the party
who orders the goods undertakes to supply a substantial part of the material necessary for
their manufacture or production (Article 3). 38 Several attempts have been made by the
judiciary to define the term CIF contract, but the most prominent definition in modern times
is that of Lord Atkinson in Johnson v Taylor Bros, 39 who described a CIF contract as follows:
“… when a vendor and purchaser of goods… enter into CIF contract…the vendor in
the absence of any special provision to the contrary is bound by his contract to do
[the following]. First, to make out an invoice of the goods sold. Secondly, to ship at
the port of shipment goods of the description contained in the contract. Thirdly, to
procure a contract of affreightment under which the goods will be delivered at the
destination contemplated by the contract. Fourthly, to arrange for an insurance
upon the terms current in the trade which will be available for the benefit of the
buyer. Fifthly, with all reasonable despatch to send forward and tender to the buyer
these shipping documents, namely, the invoice, bill of lading and policy of assurance,
delivery of which to the buyer is symbolic delivery of the goods purchased, placing
the same at the buyer’s risk and entitling the seller to payment of their price… if no
place be named in the CIF contract for the tender of the shipping documents they
must prima facie be tendered at the residence or the place of business of the buyer
[at p 155].” 40
More often than not, the likely outcome of an international sales agreement is the
physical transfer of property from a seller to an overseas buyer.41 Hence the completion of
the transaction cannot be met without the services of a carrier. 42 Depending on the nature
of the sales contract between the seller and buyer (C.I.F or F.O.B below) the carriage of
37
The CISG was adopted in Vienna in 1980 under the auspices of UNCITRAL to regulate international sale of
goods.
38
39
[1920] 122 LT 130.
40 rd
Carr I International Trade Law 3 ed (2005) 7-8.
41
Murray C Holloway D & Timson-Hunt D Schmitthoff’s Export Trade: The Law and Practice of International
th
Trade 11 ed (2007) 2.
42
9
goods, determination of the point of delivery, procurement of transport documents and
other documents relevant to the contract may be arranged by either one of them.
1.6.2 C.I.F CONTRACTS
Despite the numerous documents that comprise an international business

transaction, it is the contract of sale that determines whether liability for goods during
carriage is to lie on the buyer or the seller. Per Lord Wright in Ross T Smyth and Co ltd v TD
Bailey Son and Co, 43 Cost, Insurance and Freight (C.I.F), is the most frequently used form of
contract for the purpose of seaborne transportation. 44 It indicates that the total cost of the
goods includes its insurance and freight. Mind blowing sums resulting from an inexhaustible
number of transactions are performed every year under C.I.F contracts. 45
C.I.F contracts are concluded through the transfer of documents relating to the
contract. As a result of this transfer of documents from the seller to the buyer, a direct legal
relationship is established between the buyer on the one hand, and the carrier and the
insurer on the other. This relationship enables the buyer to claim directly from these parties
in the event of loss or damage to the goods, despite the fact that the contracts of carriage
and insurance were not concluded by the buyer but the seller.
Under C.I.F contracts the seller has to ship, or acquire after the shipment, the
contracted goods. After shipment the carrier must obtain proper bills of lading and proper
policies of insurance. The carrier fulfils its contract by transferring the bills of lading and
policies to the buyer. The general rule is that the carrier does so only against the payment of
the price agreed between the buyer and himself.46 These documents are accompanied by an
invoice which shows the price and a deduction of the freight which the buyer pays before
delivery at the port of discharge. 47
Scrutton J in Arnold Karberg & Co v Blythe, Green Jourdain & Co, 48 emphasised that it
must be borne in mind that C.I.F is not a contract that the goods shall arrive, but rather a
contract to ship goods complying with the contract of sale, to obtain, unless otherwise
stated in the contract, the ordinary contract of carriage to the place of destination, and the
ordinary contract of insurance of goods on the voyage, and to tender these documents
against payment of the contracted price.49
Under C.I.F the seller (consignor) is under an obligation to accommodate the buyer
(consignee), by paying for the cost and freight for the carriage and also insurance cover for
43
[1940] 3 ALL ER 60.
44
Carr International Trade Law 6.
45
Murray et al Schmitthoff’s Export Trade 34; Chuah Law of International Trade 125.
46
Smyth & Co ltd v Bailey Son & Co ltd.
47
Chuah Law of International Trade 126.
48
[1915] 2K.B 379 388.
49
Murray et al Schmitthoff’s Export Trade 35.
10
the cargo. 50 The seller’s objective is to pass over his right to dispose of the goods only
against receipt of the purchase price, and be exempted from liability for loss or damage to
the goods in the course of the voyage. The buyer and seller both meet their objectives when
the buyer or nominated banker- as the case may be- performs payment under terms
provided in their contract, against delivery of the documents relating to the goods. In a
business sense, the delivery of the shipping documents is the equivalent of the goods.51 This
is of great importance should the goods be lost during the voyage, as the buyer will be
compensated by the insurers for any loss covered, or claims against the ship for breach of
the contract of carriage.
1.6.3 F.O.B CONTRACTS
F.O.B generally stands for “free on board”, and refers to the kind of sales agreement
wherein the seller undertakes to place the goods on board a ship that has been named to
him by the buyer and that is berthed at the agreed port of shipment. Under F.O.B contracts
the seller bears all the expenses until the goods are delivered to the carrier, while the buyer
on the other hand has to pay subsequent charges such as freight and marine insurance, as
well as unloading charges, import duties, consular fees and all other charges due on arrival
of the goods at the port of destination.52 The buyer may also have to pay for stowage of
goods in or on board the ship; in cases where the F.O.B contract did not include the seller
taking care of stowage, in which case it would have been “F.O.B stowed” 53
In another connection, unlike C.I.F. contracts there is no standard definition F.O.B. 54

however, some light was shed as to its meaning by Lord Broughan in the case of Cowasjee v
Thompson: 55
“it is proved beyond all doubt, indeed it is not denied that when goods are sold in
London ‘free on board’. The cost of shipping then falls on the seller but the buyer is
considered the consignor.” 56
More so, F.O.B contracts are not standard. Over the years the courts have
recognised the flexibility of the terms of F.O.B contracts, for example; the buyer may
undertake to make arrangements for the loading of the goods on board and the seller on
the other hand may carry out the insurance of the goods for the buyer. In Pyrene Co Ltd v
50
51
52
Stock v Ingis (1884) 12 QBD.573.
53
54
55
(1845) 5 Moore PC 165.
56
11
Scindia Navigation Co Ltd, Devlin J. stated that,57 “F.O.B contracts have become a flexible
instrument…” 58
1.6.4 TYPES OF CARRIAGE CONTRACTS
As there exists different forms under which a contract of sale may be concluded, so
too are there different forms under which a contract of carriage may come to exist. There
are two main types of contracts of carriage; those evidenced by a Bill of Lading, and by
charter parties.59 The party who undertakes to ship the goods is known as the consignor or
the charterer. He may decide to use an entire ship for this purpose, in which case the
transaction is known as a charter party.60 Should this be the case, the consignor is referred
to as the charterer, and the ship owner the carrier. Hence, the contract is between the
charterer and the ship owner.
There are three types of charter parties;
• Voyage Charter; the ship is hired for carriage from a named port of loading to a
named port of discharge, the charterer pays freight to the ship owner, and a
specified time for loading and discharge will be provided.
• Time Charter; the charterer may use the ship for a stipulated period of time for
voyages and purposes agreed in the contract. The freight is paid on hire basis, which
is most often pre-paid, and will run from the time the vessel is delivered to the
charterer and will cease when it is returned to its owner. The Charter takes into
account times when the vessel may not be in service such as time of repairs and
maintenance in the course of the charter party. During such times known as off-hire,
the hire will be suspended until the vessel is back on track.
• Bareboat Charter or Charter by Demise; allows the charterer full control and liability
over the vessel and its crew and master, unlike the time or voyage charter parties
where liability for the crew and master remain with the ship owner, in a nutshell, the
charterer assumes the position of the ship owner for the duration of the charter. 61
In some other cases the consignor may elect not to use an entire ship but rather just
necessary space for his cargo on a general ship such as a liner plying a regular route or a
tramp that sails from port to port looking for cargo, and hence approaches the ship owner
or charterer with shipping space on his charter, [or any individual whom for the time being,
as an agent of the ship owner has the right to enter into a contract of carriage on the
ship].62 In the event where the ship owner or agent accepts the carry to shipper’s goods,
57
[1954] 2 QB 402; NV Handel Ny J. Smits Import-Export v English Exporters (London) Ltd [1957] Lloyd’s Rep
517.
58
59
60
61
Chuah Law of International Trade 229-230.
62
12
that will be referred to as a contract for the carriage of the goods by sea.63 The ship owner
or charterer who accepts to ship the goods assumes the position of the carrier, and the
remuneration due to him is referred to as freight. The carrier will hence be liable to the
consignor for loss or damage to the goods. This liability may be to the buyer/consignee in
other cases where the shipper elects to transfer his property in the goods to the third party
buyer, and relieve himself from the contract. Therefore, such third party may sue in his own
rights for loss or damage to the goods. 64
Where the consignor prefers to obtain shipping space on board part of a vessel, he is
issued a bill of lading which contains the terms of the contract of carriage. 65 Bills of lading
are not mandatory in charter parties, but where they are issued in charter parties they do
not serve in their normal capacity as evidence of the contract of carriage of goods, but
merely transport documents that evidence the receipt of goods by the carrier. 66 The
contract between the shipper and the carrier remains evidenced by the charter party and
remains outside the purview of the Hague Visby Rules because it is stipulated in Article 1(b)
of the Hague-Visby Rules that should the bill of lading not define the relationship between
the carrier and its holder, the Rules shall have no impact on their contractual
arrangements.67
1.6.5 WHY INTERNATIONAL REGULATION?
The Hague-Visby Rules apply to contracts which require the issue of a bill of lading or
any similar document of title, where such documents or bill of lading relate to the terms of
the contract of carriage of goods between ports in two different states provided:
a. The bill of lading is issued in a contracting state; or

b. The carriage is from a port in a contracting state; or
c. The contract contained in or evidenced by the bill of lading provides that the Hague-
Visby Rules or legislation of any state giving effect of them are to govern the contract.68
Where statutory law does not govern the contract of carriage, recourse must be made
to Common law Rules to ascertain the liabilities of the parties to the contract of carriage.69
The Common Law position was that the parties were on equal footing and hence the maxim
caveat emptor was frequently employed, and hence the parties were at total liberty to draw
up their rules of engagement. Be that as it may, due to the vulnerability of the consignor
who more often than not has lesser bargaining power and knowledge of the transport world
than the actual carrier, and coupled with the need for international uniformity and
63
Or contract of affreightment.
64
Infra paragraphs 3.2 and 4.2.
65
66
Article 6 (a) and (b)(i)(ii) South African Sea Transport Document Act 2000.
67
68
69
13
certainty, International conventions, such as the Hague/Hague-Visby Rules, the Hamburg
Rules and Rotterdam Rules were introduced to establish equality amongst the carrier,
consignor and consignee. 70 These conventions sought to check the liberties of the carriers in
relation to the contract of carriage and foster uniformity in the application of the law across
nations, so that the carrier does not act to the detriment of the consignor or consignee, or
unjustly limit or exclude himself from liability for loss or damage caused, except in
accordance with the relevant rules. Some of these conventions however provide for the
exclusion of certain types of contracts from their scope of application. The Hague Visby
Rules for example restricts its application to certain contracts; the Hague Visby Rules shall
not apply to the carriage of live animals, or the carriage of deck cargo, or Inland waterway
carriage, 71 and should the parties to the contract of carriage elect to apply the Hague-Visby
Rules to a contract that fall out of its scope, the Rules will operate as a contractual term and
not as law. 72
In spite of the reforms in transport rules, the Common Law remains more than
relevant to understanding carrier liability, as it provides a background against which the
operations of the present day statutes may apply, and more so remain applicable to those
instances or contracts that fall out of the scope of statute. 73
1.7 THE BILL OF LADING AND PERFORMANCE OF THE CONTRACT OF

CARRIAGE
A brief overview of the nature of the bill of lading is relevant to this study as most of
the international conventions that have governed carriage by sea over the years were based
on the bill of lading. More so, even following a call for the reform of the Hague regime, the
focus of UNCITRAL was on the bill of lading because goods were not only carried under a bill
of lading, but the bill of lading affected the interests of the parties to the contract. 74
The bill of lading is a creation of mercantile practice which has developed so much
that it stands today as the core of effective international trade.75 The courts have held that:
“a bill of lading is a document of dignity, and courts should do everything in their

power to preserve its integrity in international trade for there, especially, confidence
is of the essence.” 76
70
Supra 231.
71
Supra 231; Carr International Trade Law 315.
72
73
Chauh Law of International Trade 232.
74
75
76
The Carso 1930 AMC 1743 1758.
14
No definition of the term ‘bill of lading’ has been provided either at Common Law or
under any other legislation affecting it.77 However, it is presumed by law that any document
that is referred to and treated as a bill of lading should be able to serve as a receipt for
goods shipped; evidence of the contract of carriage; and a document of title. 78 The first
recognition by the courts as to the character of the bill of lading was in 1794, 79 in Lickbarrow
v Masin. 80 The courts acknowledged that trade usage recognises the bill of lading as a
document of title to the goods to be delivered to the consignee. 81
The bill of lading is printed in standard-form and issued in three copies, usually
stated as sets, and amongst others, bears information with regards to the state of the goods
carried, relevant dates, the names of the consignor of goods, the name and address of the
consignee or other person entitled to take delivery of the goods, a description of the goods
with regard to their quantity and condition made by the consignor, the name of the vessel
to perform the voyage, the port and time of departure and port of discharge, details
pertaining to the payment of freight and other terms of the carriage. 82 Once one of the bills
of lading has been activated to demand delivery, the rest stand void.83
The main functions of the bill of lading shall be looked at briefly below:
1.7.1 BILL OF LADING AS RECEIPTS
Before any other thing, the bill of lading signed by the carrier or any of his agents is
evidence of the receipt of the goods by the carrier for shipment.84 Statements in the bill of
lading are regarded as prima facie evidence of the receipt of the goods as described under
Article III(4) of the Hague-Visby Rules, and the carrier is estopped from rebutting this
presumption once the bill of lading has been handed to a bona fide third party. 85 In its
capacity as a receipt, the bill of lading is evidence of the quantity, condition and quality of
the goods received. 86 This is a quality enforced under the Hague Visby Rules by Article III(3),
as it imposes an obligation on the carrier to issue a bill of lading that contains: leading marks
necessary for identification of the goods, number of packages or pieces; the quantity or
weight of the goods; and the apparent order and condition of the goods.87
77
78
79
80
[1794] 5TR 683.
81
82
Van Niekerk JP & Schulze WG The South African Law of International Trade: Selected Topics 1 ed (2000) 110.
83
84
Van Niekerk and Schulze The South African Law of International Trade 111.
85
86
87
15
In the hands of the consignor or consignee, the bill of lading is prima facie evidence
that the goods have been shipped in good order and condition.88 It was held in Smith v
Bedouin Steam Navigation Co, 89 that the carrier bears the burden of proving that the goods,
as specified in the bill of lading have not been shipped, and not merely that they could have
not been shipped.90 However, the carrier is free from liability where he establishes that the
goods as stated in the bill of lading were not shipped and such evidence will avail him even
against a bona fide third party, 91 as seen in Grant v Norway. 92
1.7.2 THE BILL OF LADING AS EVIDENCE OF THE CONTRACT OF CARRIAGE
The bill of lading is usually issued to the consignor only after his goods have been
loaded on the vessel, and such loading is done in pursuance of an already existing contract
between the parties for the carriage of the goods. 93 It was on these grounds that the courts
in The Ardenes, 94 held that the bill of lading is not the contract, but mere evidence of the
contract of carriage between the consignor and the carrier. In the same vein, in Leduc v
Ward, 95 it was held that as between the carrier and the consignee, or a bona fide third party
transferee, the terms of the contract of carriage as evidenced by the bill of lading are
conclusive, and the carrier shall be estopped from providing any evidence to rebut the
terms thereof. 96
1.7.3 THE BILL OF LADING AS DOCUMENT OF TITLE
An important feature of the bill of lading is its transferability as a document of title

to the goods described therein, thus entitling its holder to take possession of the goods
from the carrier at delivery. 97 As afore mentioned, international sales transactions require
the transfer of goods across international frontiers. This transaction is not a swift one as
carriage by sea takes a considerable amount of time before the consignee receives the
goods. Because of this, custom was developed to enable the consignor to transfer property
in the goods should it be his intention,98 by simply endorsing the bill of lading to another
party,99without which it is symbolic of delivery of the goods to the buyer(consignee).100
88
89
[1896] AC 70.
90
91
Supra 179.
92
[1851] 10 CB 665.
93
Van Niekerk & Schulze The South African Law of International Trade 133.
94
[1951] 1 KB 55.
95
[1888] 20 QBD 457; see Chuah Law of International Trade 212 for facts of the case.
96
97
98
99
100
16
Hence, the transferability of the bill of lading enables the consignee, or its holder to trade
the goods to which the bill of lading relates while they are still in transit. 101
The courts have helped to provide clarity to the nature of the bill of lading as a
document of title through the decision in Sanders Bros v MacLean: 102
“the law as to the endorsement of the bills of lading is as clear as in my opinion the
practice of all European merchants is thoroughly understood. A cargo at sea while in
the hands of the carrier is necessarily incapable of physical delivery. During this
period of transit and voyage, the bill of lading by the law merchant is universally
recognised as its symbol, and the endorsement and delivery of the bill of lading
operates as a symbolical delivery of the cargo. Property in the goods passes by such
endorsement and delivery of the bill of lading, whenever it is the intention of the
parties that the property should pass, just as under similar circumstances the
property would pass by an actual delivery of the goods.” 103
It thus goes without saying that the holder of the bill of lading can sell the cargo
while it is in transit to a third party by endorsing the bill of lading and passing it to the third
party. 104 It should however be borne in mind that for the bill of lading to be transferrable as
a document of title, it must be evident on first look that it is negotiable.105 Thus it must be
set out as an ‘order bill’, which means that it is made out to a named consignee or his “order
or assigns”. Hence the named consignee could transfer or assign the bill of lading by simple
endorsement. On the other hand, where the bill is simply made to a named consignee, it is a
“straight bill”, which is non-transferable once it has been delivered to the “notify party” 106
1.7.4 PERFORMANCE OF THE CONTRACT OF CARRIAGE
Under a contract of carriage by sea, the carrier undertakes to convey specific goods
in a particular way (by sea) from a named port to another, following an undertaking by the
owner of the goods to pay a determined or determinable freight for such carriage. An
agreement for gratuitous carriage will not qualify as a contract of carriage. 107
At Common Law, in the absence of any special agreement or custom, the consignor
has to deliver the goods alongside the ship or within the reach of her tackle at his own
expense.108 Per Devlin J in Pyrene Co Ltd v Scindia Steam Navigation, 109 the contract of
101
102
[1883] 11 QBD 327.
103
104
105
106
Supra 219.
107
108
109
[1954] 1 Lloyds Rep 321 164.
17
carriage starts with a booking note issued by the carrier to confirm that space is available
and will be allocated to the contracted cargo for the journey envisaged.110
Where the exporter undertakes to secure the carriage of the goods to the buyer, the
exporter as the seller will become the consignor of the goods. In his capacity as the
consignor, he must secure space upon a vessel that will load and carry the cargo. The
consignor may do this personally or procure the services of a forwarding agent with expert
knowledge of the particulars of the transaction. The forwarding agent thus approaches a
booking agent who represents the ship owner whose vessel the exporter wishes to use, and
the booking agent in turn issues the forwarding agent a booking note confirming that space
has been secured on board the vessel that is to load and carry the cargo.111
On the other hand, the ship owner, or charterer who agrees to convey the goods is
the carrier. 112 In return for the carrier’s services he is given remuneration known as freight.
The freight may be paid or payable at destination depending upon the terms of the contract.
Freight is payable only upon the safe carriage and delivery of the goods. In Kirchner v
Venus, 113 the courts decided that, if the cargo is lost on the voyage, nothing is payable.114
Unless the norms particular to the port of loading provide otherwise, when the goods are
delivered to the carrier, the consignor receives a mate’s receipt. 115
In Harris & Son Ltd v China Mutual Steam Navigation Co Ltd, 116 the courts held that
while the goods are at the docks, they are to be inspected by a tally clerk who takes down a
record of their particulars such as date of loading, weight, identification marks, individual
package, numbers, any defect or comment on the state in which the goods are received.117
When loading is completed the carrier’s agent in charge of the loading signs the mate’s
receipt which is based on the notes supplied by the tally clerk and contains all comments
and attributes in respect of the state in which the goods were received. If the mate’s receipt
carries a negative qualification for the goods it is termed a claused receipt, as was the case
in Cremer v General Carriers SA.118 If the mate’s receipt does not contain any negative
qualifications it is a clean receipt. The qualifications on the mate’s receipt are incorporated
into the bill of the lading and qualify the bill of lading accordingly. 119
The mate’s receipt serves two purposes:
110
111
112
Supra 575.
113
(1859) 12 Moore PC 361 at 390.
114
115
Supra 285.
116
[1959] 2 Lloyds Rep 500 at 501; Naviera Mogor SA v Societe Metallurgique de Normandie: The Nogar Marin
[1988] 1 Lloyd’s Rep 412 420 CA.
117
118
[1973] 2 Lloyd’s Rep 366 284.
119
18
i) Acknowledgement by the carrier that he has received the goods in the condition
therein, that there are in his possession and that he has charge over them,
ii) They are prima facie evidence of ownership; the carrier may safely assume, unless he
has evidence of the contrary, that the holder of the mate’s receipt or person named
therein is the owner of the goods and person entitled to receive the bill of lading in
exchange for the mate’s receipt.120 Unlike the bill of lading however, the mate’s
receipt is not a document of title, hence, property in the goods does not pass with its
subsequent transfer to the holder,121 as was seen in NYK v Rambijan and
Serowgee. 122
The records of the tally clerk are usually compared with the draft bill of lading sent
by the consignor for any discrepancies, and are eventually incorporated into the final bill of
lading so that the carrier is not expected to deliver at the port of destination, cargo in any
condition other than as mentioned in the final bill of lading. 123 The consignor usually
prepares a set of two or three original bills of lading in respect of the cargo, and when the
particulars of the bill of lading and tally clerk’s records reconcile one another, the carrier or
loading broker signs them and they are handed over to the consignor. (in practice the bill of
lading is sometimes handed to the consignor only when the ship leaves port, but where the
bill of lading is issued under the Carriage of Goods by Sea Act 1971, as is the case in British
ports, the Hague Visby Rules appended to the Act provide in Article III, r.3 that the consignor
can demand the issue of the bill of lading after the carrier has received the goods into his
charge). 124 The issued bills of lading are all of the same tenor and date. If the carrier stamps
one of the bills of lading as accomplished, the others stand void. The accomplished bill
entitles the holder to the delivery of the goods to his charge.125
The various bills of lading are forwarded to the consignee by subsequent airmail to
ensure their timely and safe arrival. The consignee needs to be in the possession of at least
one part of the set of bills of lading before his goods arrive because the carrier is not bound
to deliver the goods unless a bill of lading is delivered to him. Upon receipt of the bill of
lading by the carrier he then issues a delivery order which the consignee will present to the
ship’s officer in charge of unloading and claim his goods. 126
Where the transaction was concluded under a letter of credit, the consignor is
supposed to hand the bill of lading alongside any other relevant documents to the advising
bank, and that bank then forwards the documents by air mail to the issuing bank. 127
120
Article III Rule 3 of the Hague Visby Rules, the consignor is entitled to be issued a bill of lading upon
shipment of its goods on board as evidenced by a mate’s receipt.
121
122
[1938] AC 429.
123
124
125
Supra 287.
126
Supra 287
127
Supra 288.
19
Should two or more people be in possession of a bill of lading, the carrier may hand
the cargo over to the first person who presents the bill, “provided he has no knowledge of
other claims to the goods or knowledge of any other circumstances that raise reasonable
suspicion as to the claimant’s entitlement to the goods...The carrier may not deliver the
goods to a consignee named in the bill of lading, and does so at his own peril if such a
consignee is not in fact entitled to the goods.” 128
Upon delivery of the goods in accordance with the terms evidenced by the bill of
lading, the carrier is discharged from his obligations in relation to the contract of carriage.129
1.8 FREIGHT
The reward the carrier receives for his service is referred to as freight. Freight is
payable only upon the safe delivery of the goods. In Kirchner v Venus, 130 it was held that
should the carrier lose the goods he forfeits the freight. 131 It was held in The Argos (Cargo
ex), Gaudet v Brown, 132 that the carriers’ obligation is readiness to deliver and not delivery
per se.133 Also, ‘safe’ in this context does not refer to the state of the goods on delivery. In
Dakin v Oxley, 134 it was held that; “freight is earned by the carriage and arrival of the goods
ready to be delivered to the merchant…” 135 Mores so, in Asfar v Blundell, 136 The carrier will
be entitled to his freight even if the goods are damaged unless the damage is such that the
goods can no longer be qualified as merchantable. 137
In another connection, although the carrier is not entitled to claim freight before the
cargo has reached destination and is ready for delivery, the parties to the contract are at
liberty to alter the terms of their engagement and make provisions for prepaid freight.
Although such alterations are not sanctioned by the English Carriage of Goods by Sea Act
1971, in Oriental Steamship Co Ltd v Taylor, 138 it was held that such alterations bind the
parties thereto and the carrier may sue on it should due prepaid freight not be paid.139
However, the carrier forfeits his right to freight if:
128
Scrutton TE Charterparties and Bills of Lading 20 ed (1996) 292 in Murray, Holloway & Timson-Hunt
Schmitthoff’s Export Trade: The Law and Practice of International Trade 11 ed (2007) 288.
129
130
(1859) 12 Moore PC 361 390.
131
132
(1873) LR 5 PC 134.
133
134
(1864) 15 CBNS 646.
135
136
[1896] 1 QB 123.
137
138
[1893]2 QB 518.
139
20
1) The ship never earned freight and never began to earn freight e.g. because she did not
sail. 140
2) The goods are lost before the advance freight becomes due. 141
3) The goods are lost by an event other than the expected peril.142
140
Jame CJ in Exp Nyholm, rechild (1873) 43 LJ BK 21 24; Murray et al Schmitthoff’s Export Trade 293.
141
Compania Naviera General SA v Keramental ltd; Murray et al Schmitthoff’s Export Trade 293.
142
Dufourcet v Bishop (1886) 18 QBD 373; Murray et al Schmitthoff’s Export Trade 293.
21
CHAPTER TWO
CARRIERS’ LIABILITY UNDER ENGLISH
COMMON LAW
2.1 INTRODUCTION
Carrier liability at common law attaches to the individual termed as the “common
carrier”. Common carriers are persons who hold themselves out as being prepared to carry
and convey goods on behalf of some other person for a fee. The fact that these common
carriers represented themselves as trustworthy men makes them subject to special
duties. 143
The carriers’ duties under a contract of carriage of goods by sea are implied both at
Common Law and under statute. At common law, the carriers’ liability is absolute; 144 hence
in Davis v Lockstone, 145 it was held that the carrier need not have been at fault or acted
negligently for liability for loss or damage to lie against him. 146 Lord Mansfield further
describes the obligations of the common carrier as he states that:
“…there is a further degree of responsibility (other than negligence or wilfulness) by

the custom of the realm, that is, by the common law; a carrier is in the nature of an
insurer. It is laid down that he is liable for every accident, except by the act of God,
or the King’s enemies.” 147
There has been much confusion nevertheless in determining who the common
carrier is. Should the carrier not be a common carrier but a bailee without reward for
example, the duties imposed on him shall be less strict. It was held in Levinson v Patent
Steam Cleaning, 148 that such a bailee is only required to ensure to the best of his abilities
that the cargo is not damaged or lost, and on him lays the onus to prove that he had not
been negligent in handling the cargo. 149 It was also held in Ace-High Dresses Inc v J. C.
Trucking Co; 150 that a common carrier is one "engaged in the business of carrying goods for
others as a public employment and holds himself out as ready to engage in the
transportation of goods for persons generally, as a business." 151
143
144
145
(1921) AD 153.
146
Van Niekerk & Schulze The South African Law of International Trade 96.
147
148
[1978] QB 69.
149
150
I9I A 536 (I937).
151
Marcus LP “Distinction between Common Carriers and Contract Carriers” Michigan Law Review (36) (5)
1938 802-810 802 http://www.jstor.org/stable/1281673 (Accessed: 05/10/2010 07:10).
22
At Common law, where the terms of the contract between the parties does not
expressly outline the duties of the carrier, the law expects the carrier to deliver the goods at
the agreed destination in the condition in which he received them unless prevented to do so
by circumstances beyond his control such as an act of God or an inherent vice in the
goods. 152
2.2 DUTIES OF THE CARRIER AT COMMON LAW

The implied duties of the carrier of goods at common law have been summarised as
follows: 153
2.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP
At common law the carrier is deemed to be under the implied obligation to provide a
ship that is fit for the purpose for which it contracts. 154 This undertaking is a strict one; in
Steel v State line, 155 Lord Blackburn stated that the carrier has to show that the ship is
seaworthy as a matter of fact, and will not escape liability only by showing that he took
every precaution to render the ship seaworthy. 156 In the words of Field J in Kopitoff v
Wilson, 157 the term seaworthiness can be construed such that:
“the ship owner is, by the nature of the contract, impliedly and necessarily held to
warrant that the ship is good, and is in condition to perform the voyage about to be
undertaken, or in ordinary language, is seaworthy, that is, fit to meet and undergo
the perils of the sea and other incidental risks to which she must of necessity be
exposed in the course of the voyage…” 158
The common law requirement of a seaworthy ship is absolute. The test for
seaworthiness was established in the case of Virginia Carolina Chemical Co v Norfolk and
North American Steam shipping Co, 159 as the standard of fitness which any ordinary and
careful ship owner is required to have before the beginning of any voyage, bearing in mind
the likely circumstances resulting from the nature of the journey. 160
152
Infra paragraph 3.2.
153
Chauh Law of International Trade 233-234; Carr International Trade Law 166.
154
155
[1877] 3 AC 72.
156
157
(1876) 1 QBD 377.
158
Chuah Law of International Trade 234; Stanton v Richardson (1874) LRTCP 421.
159
[1912] 1 KB 229.
160
23
Seaworthiness for the purpose of establishing carriers’ liability is twofold; firstly, it
refers to the physical condition of the ship. In Stanton v Richardson, 161 the pumping
equipment in the ship could not adequately deal with the surplus of water from a cargo of
wet sugar and this rendered the ship unseaworthy. It thus goes without saying that the ship
must be fit in both design and structure and must be suitably equipped to face the usual
perils of the sea that are likely to occur on the particular route to her destination at that
time of the year.162
Secondly, in Rathbone v Maclver, 163 it was held that a ship’s seaworthiness refers to
its fitness to carry the contractual cargo, that is, its cargo worthiness. 164 For example, should
the contract of carriage be for the carriage of frozen goods, in order for the ship to satisfy
the requirement of being cargo-worthy, it must have the necessary refrigeration to carry the
goods safely on the agreed voyage. It was held in Owners of Cargo on Ship “Maori Kings” v
Hughes, 165 that defective refrigerators will be a breach of the seaworthiness warranty.166
More so, in Moore v Lunn, 167 the courts held that, for the ship to satisfy the
requirement of seaworthiness it must also be manned by an efficient and qualified crew.
Hence where the captain or members of his crew are not sober at the beginning of the
voyage, the ship will be deemed unseaworthy. 168 Lord Atkinson in Standard Oil v Clan line
stated that: 169
“it is not disputed, I think, that a ship may be rendered unseaworthy by the
inefficiency of the master who commands her. Does not that principle apply where
the master’s inefficiency consists, whatever his general efficiency may be, in his
ignorance as how his ship may, owing to the peculiarities of her structure, behave in
circumstances likely to be met with on an ordinary ocean voyage. There cannot be
any difference in principle, I think, between disabling want of skill and disabling want
of knowledge. Each equally renders the master unfit and unqualified to command,
and therefore makes the ship he commands unseaworthy [at p120].” 170
More so, the Stanton v Richardson case established that, for the undertaking of
seaworthiness to be deemed as satisfied, the carrier must show that the ship was seaworthy
at the beginning of the journey. 171 Should the vessel suffer any default after departure or
even as soon as it leaves the harbour, the carrier’s undertaking of seaworthiness would still
161
(1875)LR 9 CP 390.
162
163
[1903] 2KB 378.
164
165
[1895] 2 QB 550.
166
Chuah law of International Trade 236.
167
(1923) 38 TLR 649; The Rio Tinto (1884) 9 App Cas 356.
168
Carr International Trade Law 212; Hare Shipping Law & Admiralty Jurisdiction 641.
169
[1924] AC 100.
170
171
24
have been satisfied. It was held in The Rona, 172 that the vessel must be deemed to have left
the harbour when the vessel has left the moorings without any intention of returning
thereto.
Be that as it may, should the vessel go missing immediately after the

commencement of the voyage, there is a presumption that lies in favour of the consignor
with claims against the carrier. In Levy v Calf and others, 173 the courts held that where such
a carrier fails to provide reasonable argument as to the disappearance of the vessel, the
courts will presume that the vessel was not seaworthy at the beginning of the voyage. 174
More so, in Cargo per Maori King v Hughes, 175 it was held that should the cargo be lost or
damaged because the vessel was not cargo worthy, the carrier will be in breach of the
implied warranty of seaworthiness. 176
Worthy of note is the fact that there must be a causal link between the damage or
loss suffered and the vessel’s unseaworthiness for an action to lie against the carrier for
breach of the implied warranty of seaworthiness. Thus, it will not suffice to prove that the
vessel was not seaworthy at the commencement of the voyage, it must be established by
evidence that the loss suffered was a result of the vessel’s unseaworthiness. Per Lord Esher
MR in Baumwoll v Gilchrist: 177
“it is not sufficient breach of a bill of lading that the ship went to sea in an
unseaworthy condition; but it must be shown that the unseaworthiness was the
cause of the loss.” 178
The carrier has to show that his vessel is seaworthy as a matter of fact. It was held in
Steel v State Line SS Co, 179that it will not suffice that the carrier took all reasonable
measures to render the vessel seaworthy. If at the beginning of the voyage the vessel was
not seaworthy and as a direct result of this the cargo was lost or damaged, the carrier is
liable. 180 The same will apply even if the voyage were to be performed in stages. In The
Vortigern, 181 it was held that the carrier will have to ensure that the vessel is seaworthy at
the beginning of each stage. 182
In as much as the common law provides the parties to a contract of carriage liberty
to establish their rules of engagement, should there be any clause in their agreement
exempting the carrier from his liability of providing a seaworthy ship, the courts will
172
(1884) 51 LT 28 213.
173
(1857) W I 4; Fiumana Societa de Navigazione v Bunge [1930] 2 KB 47.
174
175
[1895] 2 QB 550.
176
177
[1983] 1 QB 253.
178
179
(1877) 3 App Cas 72 HL.
180
181
[1899] 140.
182
25
interpret any ambiguity in their terms against the party likely to benefit from the clause. As
seen in Owners of Cargo Onboard SS Waikato v New Zealand Shipping Co: 183
“it is clear law that exceptions do not apply to protect the ship owner who furnishes
an unseaworthy ship where the unseaworthiness causes damage, unless the
exceptions are so worded as clearly to exclude or vary the implied warranty of
seaworthiness.” 184
Nevertheless, in The Cargo ex Laertes, 185 it was held that where the exclusionary
terms are so clear as to remove all doubt as to whether the parties agreed thereto, the
courts will give effect to the terms as they appear. 186
2.2.2 DUTY TO PROCEED WITH DUE DISPATCH
When the terms of the contract of carriage are silent with regard to the time of
commencement of the voyage, the common law implies that the ship will undertake the
voyage and load and discharge the goods within a reasonable time. In Hick v Raymond, 187
the courts held that this duty calls on the carrier to commence and terminate the voyage
within a reasonable or contracted time frame.188 In Freeman v Taylor, 189 it was held that
should the carrier fail in this respect, the consignor will be at liberty to consider that the
contract has been repudiated by the carrier’s delay. 190
2.2.3 DUTY NOT TO DEVIATE
The carrier is obliged to ensure that the vessel undertakes the voyage on the usual
route and manner, or that provided in the contract of carriage. The carrier may not
voluntarily deviate from his route unless such deviation is necessary to save life. It was
stated in Scaramanga & Co v Stamp that: 191
“… deviation for the purpose of communicating with a ship in distress is allowable,

inasmuch as the state of the vessel in distress may involve danger to life. On the
other hand, deviation for the sole purpose of saving property is not thus privileged,
but entails all the usual consequences of deviation. If, therefore, the lives of the
persons on board a disabled ship can be saved without saving the ship, as by taking
them off, deviation for the purpose of saving them will carry with it all the
183
[1899] 1 QB 56; Mitsubishi Corp v Eastwind Transport Ltd and Ors [2004] EWHC 2924.
184
Chuah Law of International Trade 234; 257.
185
12 PD 187.
186
187
[1893] AC 22.
188
189
(1831) 8 Bing 124; Kawasaki Kisen Kaisha Ltd v Whistler International Ltd [2000] 3 WLR 1954.
190
191
(1880) 5 CPD 295.
26
consequences of an unauthorised deviation. But where the preservation of life can
only be effected through the concurrent saving of property, and the bona fide
purpose of saving life forms part of the motive which leads to the deviation, the
privilege will not be lost by reason of the purpose of saving property having formed a
second motive for deviation [at p 304],” 192 or, as stated in Kish v Taylor, 193 in
situations in factual danger in the interest of the voyage as a whole.194
Where the parties have failed to define a voyage route under their contract, the
courts will presume that the proper route to follow is that which is the direct geographical
route between the port of departure and the port of delivery, but however remaining open
to evidence and persuasive argument as to what should be the customary route. In this case
the customary route may be the route usually taken by the shipping company in that
particular trade or the route frequently employed by the carrier in particular. 195 More so, in
Reardon Smith Line Ltd v Black Sea and Baltic Insurance Co, 196 it was held that should the
carrier allege that there exists a customary route, the burden of proof that the custom is
both universal and uniform rests on his shoulders. 197 In the same vein, it was held in Rio
Tinto Co Ltd v Seed Shipping Co, 198 that, should the vessel be moved off its course by
circumstances beyond the ship master’s control, this will not amount to deviation.199
Given the parties freedom of contract at common law, the carrier could introduce a
clause in the contract that enables him to deviate from the elected course of the voyage
without jeopardising the entire contract. Such a clause however must not defeat the object
of the contract of carriage. Per Lord Wright in Foreman v Federal SN Co, 200 “every deviation
clause must be construed with reference to the contemplated adventure.” 201 The courts
however, where such a clause covers only the carrier’s interests, apply a restricted
interpretation to the clause. 202
2.2.4 DUTY TO TAKE REASONABLE CARE OF THE GOODS
The implied obligation of the carrier to take reasonable care of the goods in his
charge was stated by Channel J in McFadden v Blue Star Line: 203
192
Carr Law of International Trade 217-218.
193
[1912] App Cas (HL).
194
195
196
[1939] AC 562.
197
198
(1926) 134 LT 764.
199
200
[1928] 2KB 424 431.
201
202
Glynn v Margetson [1893] AC 351.
203
[1905] 1 KB 697.
27
“If anything happens whereby the goods are damaged during the voyage, the ship
owner is liable because he is an insurer except in the event of the damage happening
from some cause in respect of which he is protected by exceptions in his
contract.” 204
Per Lord McNaghten in The Xantho, 205 all contracts of carriage have an implied
obligation that the carrier will “use due care and skill in navigating the vessel and carrying
the goods.” 206
More so, Willes J,207 also contended that there is a duty imposed on the master
acting on behalf of the ship owner:
“to take reasonable care of the goods entrusted to him, not merely in doing what is
necessary to preserve them on board the ship during the ordinary incidents of the
voyage, but also in taking reasonable measures to check and arrest their loss,
destruction or deterioration, by reason of accidents.” 208
However, in Transocean Liners Reederei GmbH v Euxine Shipping Co Ltd (The Imvros), 209 it
was established that should the terms of the contract stipulate that the consignor is
responsible for the care of the cargo, the carrier is relieved from this implied duty at
common law. 210
2.2.5 DUTY TO DELIVER GOODS TO A NAMED OR IDENTIFIABLE PERSON
The courts in Bourne v Gatliffe, 211 held that in order to be discharged of his duty the
carrier must deliver the goods to the person named either in the bill of lading, mate’s
receipt or charterparty at the point of discharge. 212 The carrier is expected to wait for a
reasonable period of time for the consignee to take over the goods at the port of discharge.
Where the consignee fails to take possession of his cargo within a reasonable amount of
time, the carrier must leave them in a warehouse at the consignee’s expense, in accordance
with sections 492 to 498 of the Merchant Shipping Act 1894.213
At common law where the carrier delivers goods only upon presentation of the bill
of lading or charterparty or other relevant document of title to the goods, he will be
protected from any action for misdelivery or tort. 214 This position was upheld in MB Pyramid
204
205
[1887] 12 AC 503.
206
207
Notara v Henderson (1872) LR 7 QB 225.
208
209
[1991] 1 Lloyd’s Rep 848.
210
211
(1841) 133 ER 1298.
212
Chauh Law of International Trade 252.
213
Supra 253.
214
Supra 253.
28
Sound NV v Briesse-Schiffahrts GmbH (The Sina) (The Ines), 215 and is in line with the rule
established in Barclays Bank Ltd v Commissioners of Customs and Excise that: 216
“It is clear law that where a bill of lading or order is issued in respect of a contract of
carriage by sea, the ship owner is not bound to surrender possession of the goods to
any person whether named as consignee or not, except on production of the bill of
lading.” 217
Where no bill of lading was issued for the voyage, the cargo is deliverable to the
consignor whose name is stated on the non-negotiable receipt issued by the ship’s master,
when he takes charge of the goods at the port of shipment, who in this situation is also the
consignee.218
In another connection, it was held in Merit Shipping Co Inc v TK Boesen A/S (The
Goodpal), 219 that the carrier is only entitled to deliver the exact quantity of the merchandise
stated in the contract at the named port of delivery. Should the carrier deliver more than is
stated in the bill of lading or charterparty, no matter the circumstance, he does so at his
own risk. 220
2.3 COMMON LAW EXCEPTIONS FROM LIABILITY

In as much as a breach of the above mentioned obligations of the carrier will impose
liability on him, the common law also awards a number of exceptions to the carriers’ liability
in the event of loss or damage to the goods. Theses exceptions include the following:
2.3.1 ACTS OF GOD
For the cause of loss or damage to be attributed to an act of God, the courts in
Nugent v Smith, 221 held, “the damage or loss in question must have been caused directly
and exclusively by such direct and violent and sudden and irreversible act of nature as the
defendant could not, by any amount of ability, foresee would happen or, if (they) could not
by any amount of care and skill resist, so as to prevent its effects.” 222
215
[1995] 2 Lloyd’s Rep 144; The Houda [1994] 2 Lloyd’s Rep 541.
216
[1963] 1 Lloyd’s Rep 81.
217
218
Supra 253.
219
[2000] 1 Lloyd’s Rep 638.
220
221
(1876) 1 CPD 423.
222
29
2.3.2 ACT OF THE QUEEN’S ENEMIES
The carrier would be exempted from liability should he suffer an attack by enemies
of the state. In Russell v Niemann, 223 it was held that where the carrier is robed by armed
forces with intent to rob him of the goods, his liability stands. This is so as to protect
consignors from carriers who would connive with robbers. 224 Per Lord Mansfield in Forward
v Pittard: 225
“If an armed force comes to rob the carrier of the goods, he is liable: and a reason is
given in the books, which is a bad one, viz. that he ought to have sufficient force to
repel it: but that would be impossible in some cases, as for instance in the riots in
the year 1780. The true reason is, for fear it may give room for collusion, that the
master may contrive to be robbed on purpose, and share the spoil.” 226
2.3.3 INHERENT VICE
For the carrier to exempt himself from liability based on this defence, he must
establish that the loss or damage resulted from the nature of the cargo that was not within
his control, and which no degree of care could have prevented. In The Carcore, 227 the term
inherent vice has been defined as the inability of the goods to withstand the ordinary nature
of the voyage despite the exercise of care required by the carrier. 228 Be that as it may, it was
held in Hudson v Baxedale, 229 that for the carrier to exempt himself from liability based on a
claim of inherent vice in the goods, he must prove that he himself had not been at fault. 230
2.3.4 FAULT OR FRAUD OF CONSIGNOR
The courts have established in Bradley v Waterhouse, 231that the carrier exempts
himself from liability if he establishes that the loss or damages were caused by an
intentional act or omission of the consignor. 232
223
(1864) 17 CB (NS) 163.
224
225
(1785) 1 TR 27.
226
227
[1896] 65 LJ Ad 97.
228
229
(1857) 2 H&N 575.
230
231
(1828) 3 COP 318; Gould v South Eastern and Chatham Railway Co [1920] 2 KB 186.
232
30
2.4 LIMITATION OF CARRIER LIABILITY AT COMMON LAW
The strict liability imposed on carriers under contracts of carriage has been a
preoccupying factor to carriers; hence the carriers take advantage of their liberty at
common law to determine the terms of their engagement to introduce exclusionary clauses
that limit their liability under contract as much as possible. Be that as it may, in Mitsubishi
Corp v Eastwind Transport Ltd and Ors, 233 it was held that should the wordings of such
exclusionary terms be ambiguous, the courts would construe its meaning in contra
proferentem. 234
Given the endless nature of the exclusionary terms often introduced by the carriers
in their contracts, it wouldn’t be practical to go into each of them. However some of the
most commonly introduced exclusionary clauses will include the following:
2.4.1 PERILS OF THE SEA
In Canada Rice Mills v Union Marine, 235 it was held that where the carrier exempts
himself from liability under contract for loss or damage as a result of perils of the sea this
clause will be construed as to mean damage or loss caused by storms, sea water, collision or
any other peril likely to be caused by the sea or to affect a ship at sea.236 However, in The
Xantho, 237 the courts held that the words ‘perils of the sea’ will not cover loss or damage
caused by the inevitable action of the wind and waves that lead to wear and tear.238
More so, in Thames and Mersey Marine Insurance Co v Hamilton, Fraser & Co, 239 it
was held that giving a too broad interpretation to this clause will not be in the best interest
of all parties under the contract of carriage, as the carrier may tend to attribute every
incident on the voyage to perils of the sea. Hence the carrier should not be exempted in
situations such as where damage is caused by poor management of the vessel. 240 In a bid to
determine the scope of this exclusionary clause, Lord Wright in the Canada Rice Mills Ltd v
Marine and General Insurance Co. Ltd case stated that: 241
“Where there is an accidental incursion of seawater into a vessel at a part of the

vessel and in a manner, where seawater is not expected to enter in the ordinary
course of things, and there is consequent damage… there is prima facie a loss by
233
[2004] EWHC 2924 (comm).
234
235
[1941] AC 55.
236
237
(1887) 12 App Cas 503.
238
239
(1887) 12 App Cas 484.
240
241
[1941] AC 55.
31
perils of the sea. The accident may consist in some negligent act, such as improper
opening of a valve, or a hole made in a pipe by mischance, or it may be that sea
water is admitted by stress of weather or some like cause bringing the sea over
openings ordinarily not exposed to the sea or, even without stress of weather, by the
vessel heeling over owing to some accident, or by the breaking of hatches or other
coverings. These are merely a few amongst many possible instances in which there
may be a fortuitous incursion of seawater. It is the fortuitous entry of seawater
which is the peril of the sea in such cases.” 242
2.4.2 ARREST OR RESTRAINT OF PRINCES
This exclusionary clause has been construed to apply to a number of situations. For
instance, in Geipel v Smith, 243 it could be invoked where a carrier was stopped from making
delivery as provided in the contract of carriage due to a situation wherein the government
of another country prevented him from doing so, by taking possession of the goods through
embargo, arrests, blockades or quarantines. 244 However, in Rickards v Forrestal, 245 the
courts held that for the carrier to succeed under this claim he must show that the threat of
the arrest or restraint of princes by a foreign power is a matter of fact and not a mere
apprehension.246 Lord Loreburn describes a situation that will qualify as a restraint of
princes as follows:
“… if the situation had been so menacing that a man of sound judgement would
think it foolhardiness to proceed with the voyage, I should have regarded that as in
fact a restraint of princes. It is true that mere apprehension will not suffice, but on
the other hand it has never been held that a ship must continue her voyage till
physical force is actually exercised.” 247
More so, in Nesbitt v Lushington, 248 it was held that restrictions on sea routes for
safety purposes or due to political unrest will not be covered by this clause. 249 Also, in
Rowlatt J, Ciampa v British India Steam Navigation Co Ltd, 250 it was held that where the
threat of restraint of princes exists at the time the vessel begins the voyage, the carrier
would be estopped from pleading the limitation clause. 251
242
243
(1872) lr7 QB 404.
244
245
[1942] AC 50; Watts, Watts & Co Ltd v Mitsui & Co Ltd [1917] AC 227.
246
247
Supra 261.
248
(1792) 4 TR 783.
249
250
[1915] 2 KB 774.
251
32
2.4.3 STRIKES
The carrier of goods would often want to exempt himself from any liability that
arises as a result of a strike action by his crew or other agents whose services are required at
some point in the performance of the contract of carriage. The word ‘strikes’ was initially
construed in King and Ors v Parker, 252 to mean “a concerted effort by workmen either to
obtain an increase in wages or to resist an attempt by employers to reduce their wages.”253
It was later on held that there need not be a grievance against employers for the workers to
strike as there could also hold sympathetic strikes. In the words of McNair J in The Laga: 254
“…since… one has had the great development of sympathetic strikes, when one has
had, at any rate in this country, and, indeed, elsewhere, the general strike in which
many of those out on strike had no grievance at all against an employer. And, in my
judgment, it would be extremely difficult to say in a charter-party such as this that a
sympathetic strike or a general strike which had the effect of causing the loss of time
was not a strike within the meaning of the charter-party.” 255
Lord Denning MR, 256also held that where workers stopped performing their obligations
towards their employer in a view of improving their working conditions, though not in
breach of the contract, this amounted to a strike. 257 For the carrier to exempt himself from
liability he must establish that the loss or damage suffered was a result of the strike. In
Leonis v Rank (No.2), 258 it was held that this exception clause covers not only direct loss or
damage but also loss or damage caused as a result of the aftermath of the strike. 259
2.4.4 FIRE
It is common that carriers include a clause to exempt themselves from loss or

damage to the cargo caused by fire. They would usually do so because of the limited
protection awarded under section 186 of the Merchant Shipping Act 1995.260 Loss or
damage due to fire as defined by the courts in insurance cases refers to: 261
“… any loss resulting from an apparently necessary and bona fide effort to put out a
fire, whether it be by spoiling the goods by water, or throwing the articles of
furniture out of the window, or even the destroying of a neighbouring house by an
explosion for the purpose of checking the progress of the flames, in a word, every
252
(1876) 34 LT 887.
253
254
[1966] 1 Lloyd’s Rep 582.
255
Chuah Law of international Trade 262.
256
New Horizon [1975] 2 Lloyd’s Rep 314.
257
258
(1908) 13 Com Cas 295.
259
260
Supra 264.
261
Kelly CB in Stanley v Western Insurance Co (1868) LR 3 Ex 71.
33
loss that clearly and proximately results, whether directly or indirectly, from the fire,
is within the policy.” 262
However, in Maxine Footwear Co Ltd v Canadian Merchant Marine, 263 it was

established that this defence will not be awarded to the carrier if the fire started because of
the carrier’s lack of due diligence to render the vessel seaworthy. 264
2.4.5 NEGLIGENCE AND NAVIGATIONAL ERRORS
Including a clause in the bill of lading that exempts the carrier from liability for any
loss or damage as a result navigational errors was common practice amongst carriers.
Nevertheless the courts have also advocated for careful interpretation of such clauses,
especially where the words therein are ambiguous. In the words of Bowen LJ in Burton & Co
v English: 265
“There is… another rule of construction which one would bring to bear upon this
charterparty, and that is, that one must see if this stipulation which we have got to
construe is introduced by way of exception or in favour of one of the parties to the
contract, and if so, we must take care not to give it an extension beyond what is
fairly necessary, because those who wish to introduce words in a contract in order to
shield themselves ought to do so in clear words.” 266
Thus the defendant carrier will avail himself under such an exclusionary clause only if
it is so worded as to erase any ambiguity relating to its meaning and scope. Per Lord
Bingham J in The Emmanuel C: 267
“In the shipping commercial world it is not unusual to see exemption clauses which
clearly expressly exclude liability for negligence so that, in general, there is no, and
never has been any, reluctance to use appropriate language to make it abundantly
clear that negligence is being excepted.” 268
2.5 CONCLUSION
The relationship between the carrier and the cosignor was likened to that of a bailee
of goods. In Morris v Martin, 269 the carriers were regarded as bailees for rewards whose
262
263
[1959] 2 Lloyd’s Rep 105.
264
265
(1883) 12 QBD 218.
266
267
[1983] 1 Lloyd’s Rep 310.
268
269
[1966] 1 QB 716.
34
obligations were borne independently of the contract. The foundation of any bailment is the
voluntary taking of another’s property from which the law assumes a consequent and
similarly voluntary undertaking of duties towards the owner of such property. 270 At
Common law, the bailee was imposed a strict duty to take reasonable care to keep the
property in his possession safe [as per Lord Denning MR 726]: 271
“If the goods are lost or damaged, whilst they are in [the bailee’s] possession, he is
liable unless he can show−and the burden is on him to show−that the loss or damage
occurred without any neglect or default or misconduct of himself or of any of the
servants to whom he delegated his duty.” 272
It goes thus that the carrier’s liability at Common law is a strict one unless he can
prove lack of neglect, default or misconduct. The effect of this strict liability on the common
carrier is such that he cannot escape liability for loss or damage to goods in his care unless
such loss or damage was caused by one of the excepted perils as shown above. 273
With developments in ship building during the 19th century, the strict liability regime
of the Common law was considerably modified to the advantage of the carrier. The
Common law principle of freedom of contract allowed the carriers to modify the terms in
the bill of lading to their advantage, as they reduced their liability under contract by
increasing the range of excepted perils to cover losses such as ones caused due to
negligence in navigation or management.274 Be that as it may, the courts recognized that
the starting point of the liability regime at common was bailment, and hence in interpreting
the clauses included in the bill of lading by carriers, the courts held that there are
fundamental obligations out of which the carrier could contract only by the clearest words,
and breach of which might prevent the application of contractual excepted perils.275 Lord
Wright observed in Paterson Steamships Ltd v Canadian Co-Operative Wheat Producers
Ltd: 276
“At common law, [the sea carrier] was called an insurer, that is he was absolutely
responsible for delivering in like order and condition at the destination the goods
bailed to him for carriage. He could avoid liability for loss or damage only by showing
that the loss was due to the act of God or the King’s enemies. But it became the
practice for the carrier to stipulate that for loss due to various specified
contingencies or perils he should not be liable: the list of these specific excepted
perils grew as time went on. That practice, however, brought into view two separate
aspects of the sea carrier’s duty which it had not been material to consider when his
obligation to deliver was treated as absolute. It was recognized that his overriding
270
Todd Cases and Materials on International Trade Law (2003) 494.
271
Supra Morris v C W Martin & sons.
272
Todd Cases and Materials on International Trade 494.
273
Zamora 1975 American Journal of Comparative Law 397 http://www.jstor.org/stable/839373.
274
Zamora 1975 American Journal of Comparative Law 400-401 http://www.jstor.org/stable/839373.
275
Todd Cases and Materials on International Trade 495.
276
[1934] AC 544-545 PC.
35
obligations might be analyzed into a special duty to exercise due care and skill in
relation to the carriage of goods and a special duty to furnish a ship that was fit for
the adventure at its inception. These have been described as fundamental
undertakings, or implied obligations. If then goods were lost (say) by perils of the
seas, there could still remain the inquiry whether or not the loss was also due to
negligence or unseaworthiness. If it was, the bare exception did not avail the
carrier.” 277
In the light of the foregone, it is clear that implied duties were imposed on the
carrier at common law. In accordance with these implied duties, the carrier was prima facie
liable if the goods in his possession were not delivered to their destination in the same
condition in which he received them. Apart from his duty to render his vessel seaworthy for
the voyage there is also an implied obligation that he will make due dispatch and will not
deviate unless such deviation is to save a life not property.
In principle, the carrier at common law may contract out of his contractual duties.
However, such clauses that give the carrier the right to deviate are subject to the principle
of contra proferentem in their interpretation and application, and will not avail him unless
the terms thereof are clearly spelled out without any ambiguity that will suggest that
adhering to them will defeat the purpose and object of the contract, as was held in Glynn v
Margetson & Co, 278 to which Lord Halsbury opined that:
“… it seems to me that in construing this document, which is a contract of carriage

between the parties, one must in the first instance look at the whole of the
instrument and not at one part of it only. Looking at the whole of the instrument,
and seeing what one must regard, for a reason which I will give in a moment, as its
main purpose, one must reject words, indeed whole provisions, if they are
inconsistent with what one assumes to be the main purpose of the contract. The
main purpose of the contract was to take on board at one port and to deliver at
another port a perishable cargo…
Now if one applies the principle…to the present case, in which the parties have in
writing expressed the intention that there should be a delivery of goods (and the
particular class of goods is not to be omitted from consideration−they were
perishable goods taken from one port to another) it seems to me that to apply these
general printed words (which might in a particular case receive complete fulfillment)
as regards each of these stipulations, to the particular contract as between carrier
and customer would manifestly defeat the very object which both the parties had in
view.
My Lords, I also concur with my noble and learned friend on the woolsack that the
particular words which give the liberty are to be construed to refer to a liberty to
277
Todd Cases and Materials 495; Smith, Hogg v Black Sea and Baltic General Insurance [1940] AC 997 1004.
278
[1893] AC 351.
36
deliver in the course of a voyage which has been agreed upon between the
parties.” 279
The consignor is not free of obligations under the contract as seen above, however
his most obvious duty is to pay freight.
From the foregone points it is clear that the common law implied undertakings are
not mandatory and can always be contracted out in the right circumstances. Thus despite
the strict liability the common law imposes on the carrier, the consignor and the consignee,
in some cases may still have to bear the burden brought about by the exclusionary clauses
introduced in the contract by the carrier.
279
Todd Cases and Materials 497.
37
CHAPTER THREE
CARRIERS’ LIABILITY UNDER THE
HAGUE/HAGUE VISBY REGIMES
3.1 INTRODUCTION
As seen in the preceding chapter, the liability imposed on the carrier of goods at
common law was a strict one. Nevertheless, taking advantage of the freedom of contract
awarded to parties under the common law, and with the use of suitable clauses introduced
in the contract of carriage, the carrier could exempt himself from his strict liability. This
tendency of the carrier to exempt himself from liability through agreement in the contract
was further boosted in the 19th century with major developments in the ship building
industry which lead to an increase in ocean traffic. 280
The nature of the exclusionary clauses included in the bills of lading was such that
they not only favored the carriers, but all risks of transporting the cargo were shifted to the
consignor and consignee who were expected to ship their goods on the terms imposed by
the carrier or not ship at all. 281 In Australasian United Steam Navigation Co Ltd v Hiskens, 282
Justice Isaacs’ position with regard to these exclusionary clauses was that:
“Common law relations based on reasonableness and fairness were in practice

destroyed at the will of the (carrier), and as fast as courts pointed out loopholes in
their conditions, so fast did they fill them up, until at last the position of owners of
goods became intolerable.” 283
This state of affairs definitely did not please the merchants around the world as they
started mounting pressure on their local authorities to introduce measures in legislature
that would check the carrier’s monopoly over the carriage of goods by sea. It is in the light
of such uproar that the United States passed the Harter Act in 1893 which was aimed at
limiting the carrier’s freedom of contract and award better protection to the consignor and
280 th th
Carr International Trade Law 233 (for an interesting overview of shipping policies from the 15 -20
centuries, see Sweeney, ‘From Columbus to cooperation-trade and shipping policies from 1492 to 1992’
[1986/1990] 12 Fordham International LJ 481).
281
Supra Wanigasekera, “Comparison of Hague-Visby and Hamburg Rules”
http://www.scribd.com/doc/59734937/Comparison-of-Hague-and-Hamburg-AW .
282
(1914) 18 CLR 646 671.
283
38
consignee. It was not long after the adoption of the Harter Act in the United States of
America that calls for an international regime to protect the interest of parties under a
contract of carriage by sea was sought. This resulted in the enactment of the Hague Rules in
1924.284 The Hague Rules were designed on the provisions of the Harter Act, and imposed
minimum liability on the carriers from which no deviation could be brought. 285
However, the provisions under the Hague Rules did not have ‘the force of law’,286
and were held in Vita Food Products Inc v Unus Shipping Co Ltd, 287 to have effect more by
agreement than law in the absence of a paramount clause, 288 and still permitted exceptions
from liability that favored the carriers when sued under the contract of carriage. 289 Also,
litigations, 290 and the provisions with regard to package limitations were considered
commercially unrealistic, 291 due to inflation and developments in the sea transport industry
such as the use of containers in carriage, which rendered the provisions of the Hague Rules
inconsistent with the realities of the transaction. The provisions of the Hague Rules did not
cover acts by servants or agents of the carrier amongst other short comings, thus leading to
the enactment of the Hague-Visby Rules in 1968, 292 to correct the flaws of the Hague
Rules. 293
The Rules are silent with regards to their interpretation. However, English courts, as
was seen in Stag Line Ltd v Foscola, Mango and Co, 294 have advocated that in the
interpretation of the provisions of the statute, the convention should be given a broad
interpretation that will be in line with norms of general acceptation. 295
The provisions of the Rules have been implemented in the United Kingdom by virtue
of the Carriage of Goods by Sea Act 1971, 296 (to which much reference shall be made in the
course of this work). Section 1(2) of the COGSA 1971 provides that the Rules shall have the
284
For more detail on the origin of the Hague Rules, see James University of Pennsylvania Law Review and
American Law Register http://www.jstor.org/stable/3313985.
285
286
The Morviken [1982] 1 Lloyd's Rep 325 328, where Lord Denning MR explained the meaning of “the force of
law”:
“In my opinion it means that, in all Courts of the United Kingdom, the provisions of the rules are to be given
the coercive force of law. So much so that, in every case properly brought before the Courts of the United
Kingdom, the rules are to be given supremacy over every other provision of the bill of lading. If there is
anything elsewhere in the bill of lading which is inconsistent with the rules or which derogates from the
effect of them, it is to be rejected. There is to be no contracting-out of the rules.” In Tetley “The Hague
Visby Rules commentary” McGill University 9 http://tetley.law.mcgill.ca/.
287
[1939] AC 277.
288
289
Lord Goff “Commercial Contracts and the Commercial Court” 1984 LMCLQ 382 396 in Todd Cases and
Materials 501.
290
Riverstone Meat Co Pty Ltd v Lancashire Shipping Co (The Muncaster Castle) [1962] AC 446 in Todd Cases
and Materials 521.
291
292
Hereinafter referred to as the Rules.
293
Supra paragraph 1.1.
294
[1923] AC 328.
295
296
Hereinafter referred to as COGSA 1971.
39
force of law, hence they shall be applied as directly enacted statute in the area where they
are acceded to. 297
Article 1 provides that the Rules will only apply to contracts of carriage covered by a
bill of lading or similar document of title, provided the bill of lading or such document of
title regulates the relationship between the carrier and the consignor.298Also, the Rules deal
with the problem of inclusion of a clause paramount in the contract to give effect to its
provisions. Article X provides for direct application of the Rules, as it states that the
provisions of the Rules shall apply to the carriage of goods between ports in two different
states if: 299
a) The bill of lading is issued in a contracting state, or

b) The carriage is from a port in a contracting state, or
c) The contract contained in or evidenced by the bill of lading provides that these Rules
or legislation of any state giving effect to them are to govern the contract, whatever
may be the nationality of the ship, the carrier, the consignor, the consignee or any
other interested person.
Additionally, s.1(6)(b) provides that the Rules shall have the force of law with regard
to “any receipt which is a non-negotiable document marked as such if the contract
contained in or evidenced by it is a contract for the carriage of goods by sea which expressly
provides that the Rules are to govern the contract as if the receipt were a bill of lading.” 300
Thus, as was upheld in The Hollandia, 301 no derogation could be brought to the provisions of
the Rules. 302
In another connection, although the relationship between a consignor and a carrier

under a charterparty is not covered by a bill of lading, the Rules shall however apply
between a carrier and a consignor who holds a bill of lading issued by the original ship
owner because that bill of lading covers the contract between both of them. Per Art V of the
Act:
“…The provisions of these Rules shall not be applicable to charter parties, but if bills
of lading are issued in the case of a ship under a charter party they shall comply with
the terms of these Rules…” 303
Nevertheless, difficulty in determining who the carrier is under the Rules has been
subject of much litigation. 304 A case in point is The Venezuela. 305
297
298
299
300
301
[1983] 1 AC 565.
302
303
40
Article 1(e) provides that the ‘carriage of goods’ covers the period from the time
when the goods are loaded to the time of delivery, leaving to think that the carrier is free
from liability for any loss or damage caused before the loading of the cargo, or after they
have been discharge. The courts in Pyrene Co Ltd v Scindia Navigation Co Ltd, 306 however,
have advised that a strict interpretation of this provision would be fallacious. Per Devlin J:
“… the cause of the fallacy perhaps [lie] in the supposition inherent in it that the
rights and liabilities under the rules attach to a period of time. I think they attach to
a contract or part of a contract. I say ‘part of a contract’ because a single contract
may cover both inland and sea transport; and in that case the only part of it that falls
within the rules is that which, to use the words in the definition of ‘contract of
carriage’ in article 1(b), ‘relates to the carriage of goods by sea’. Even if ‘carriage of
goods by sea’ were given by definition the most restricted meaning possible, for
example, the period of the voyage, the loading of the goods (by which I mean the
whole operation of loading in both its stages and whichever side of the ship’s rail)
would still relate to the carriage on the voyage and so be within the ‘contract of
carriage’.” 307
In as much as these international conventions improve on the state of maritime

transactions they do not render the common law provisions redundant, as should the
parties to the contract agree to, recourse will be made to common law principles of sea
carriage where the conventions in force do not cover the particular kind of carriage. For
instance, the Rules excludes the following type of cargo from their application:
a) The carriage of live animals per Article I(c)

b) Cargo which by the contract of carriage is stated as being carried on deck and is so
carried (Article I(c))
c) The carriage of “particular goods” so long as the contractual terms are incorporated
into a non-negotiable receipt and no bill of lading has been or will be issued (Article
VI)
With regard to Dangerous goods, Article IV(6) provides that should goods of an
inflammable, explosive or dangerous nature be shipped without the carrier’s, or his agent’s
consent or knowledge, the carrier may, without pain of liability, for loss or damage to the
cargo that could result thereof, land such cargo at any place, or destroy or render them
harmless. Liability for any loss or damage caused as a result of the shipment of such
dangerous goods shall lie on the consignor. The carrier will still be entitled to rid his vessel
304
Selvig E “Through-Carriage and On-Carriage of Goods by Sea” American Journal of Comparative Law (27)
Unification of International Trade Law: UNCITRAL's First Decade 1979 369-389
http://www.jstor.org/stable/840040 (Accessed: 26/07/2011 06:17).
305
[1980] 1 Lloyd’s Rep 393.
306
[1954] 2 QB 402.
307
41
of such dangerous goods even if he had previous knowledge of their nature without fear of
liability, except to the general average, if any. 308
The Rules do not provide a definition of the term ‘dangerous goods’, however the
English courts in Effort Shipping Co Ltd v Linden Management SA and Anor (The Giannis
NK), 309per Lord Lloyd, provide that:
“Goods could be dangerous within rule 6 if they were dangerous to the other goods,
even though they were not dangerous to the vessel itself. ‘Dangerous’ was not to be
confined to goods which were liable to cause direct physical damage to other
goods…” 310
3.2 DUTIES OF THE CARRIER UNDER THE HAGUE-VISBY RULES

Establishing the identity of ‘the carrier’ under the Rules is vital before we consider
his responsibility under contracts covered by the Rules. This is so because the Rules impose
a 1 year time limit within which period actions against the carrier must be brought, default
of which the consignee is deemed to have forfeited any right to claims he has for breach of
contract against the carrier. 311 In defining who the carrier is, Article I (a) includes the owner
(of the ship) or charterer who enters into a contract of carriage with the shipper (consignor).
Within the definition of Article I(a) Robert Goff J in The Khian Zephyr, 312expounds on the
meaning of the word ‘carrier’ as follows:
“… the function of Art I (a) … in providing that the word ‘carrier’ includes the owner
or the charterer who enters into a contract of carriage with the shipper, is to
legislate for the fact that you may get a case-for example, under bills of lading-where
the bills of lading are charterers’ bills; and where there are charterers’ bills, of
course, the charterer is in a contractual relationship with the cargo owner and is
responsible under the bills of lading to the cargo owners. In those circumstances, the
effect of the definition in Article I(a) is to ensure that provisions which apply to the
carrier under the Hague Rules shall likewise apply not only to the ship owner in
whose ship the goods are physically being carried and through whose servants and
agents, the master and the crew of the ship he is physically in possession of the
goods, but shall also apply to a charterer who has contracted as the other party to
the bill of lading. That makes good sense, and provides a common sense explanation
why the definition of ‘carrier’ should be so defined in Article. I(a) as to include the
308
309
[1996] 1 Lloyd’s Rep 577 CA; [1998] 1 Lloyd’s Rep 337 HL.
310
311
Carr International Trade law 237.
312
[1982] 1 Lloyd’s Rep 72.
42
owner or the charterer who enters into a contract of carriage with a shipper (at pp
75-76).” 313
The definition of the term ‘carrier’ has been subject of much litigation in order to
determine on whom liability for loss or damage to cargo shall lie as was seen in Homburg
Houtimport BV v Argosin Pvt Ltd and Others (The Starsin). 314 The following duties are
imposed on the carrier under the Hague Visby Rules:
3.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP
Article III(1) provides that the carrier shall be bound before and at the beginning of
the voyage to exercise due to:
(a) Make the ship seaworthy;

(b) Properly man, equip and supply the ship; and
(c) Make the holds, refrigerating and cool chambers, and all other parts of the ship
in which the goods are carried fit and safe for their reception, carriage and
preservation.
Article III(2) goes further to state that subject to the provisions or Article IV, the
carrier shall properly and carefully load, handle, stow, carry, keep, care for and discharge
the goods carried. 315
Similarly to what obtains under the Common law, the term ‘seaworthy’ under the
provisions of the Rules relates to both the physical state of the ship and its fitness to carry
the contractual cargo, that is, its cargo worthiness. 316 But unlike at Common law the
undertaking of seaworthiness under the Rules is not absolute. This is in conformity with the
provisions of Article IV(1) which provide that; the carrier shall not be liable for loss or
damage arising or resulting from unseaworthiness unless caused by want of due diligence
on the part of the carrier to make the ship seaworthy. 317
The courts in The Amstelslot, 318 in construing the meaning of ‘due diligence’ have
likened it to negligence. Lord Devlin stated that:
“lack of due diligence is negligence; what is at issue… is whether there was an error
of judgment that amounted to professional negligence [at p 235].” 319
313
314
[2003] 1 Lloyd’s Rep 571.
315
316
Supra Paragraph 3.2.
317
318
[1963] 1 Lloyd’s Rep 40.
319
43
Where it established that the loss of damage to the cargo was as a result of the
ship’s unseaworthiness, the onus is on the carrier to prove that he exercised due diligence
as was seen in Owners of Cargo Lately Laden onboard the ship Torepo v Owners and/or
Demise Charters of the ship Torepo. 320 Article IV(1) provides that:
“… neither the carrier nor the ship shall be liable for loss or damage arising or
resulting from unseaworthiness unless caused by want of due diligence on the part
of the carrier to make the ship seaworthy … in accordance with the provisions of
Article III(1). Whenever loss or damage has resulted from unseaworthiness, the
burden of proving the exercise of due diligence shall be on the carrier or other
person claiming exemption under this article.” 321
More so, the carrier’s duty to exercise due diligence is extended to affect the acts or
omissions of his servants and agents in his employment.322 In Riverstone Meat Co Pty Ltd v
Lancashire Shipping Co Ltd (The Muncaster castle), 323 it was held that the carrier does not
relieve himself of his burden of proving due diligence by merely showing that he had
delegated responsibility to a competent or specialist contractor. In support of this position
Lord Radcliffe stated that:
“I should regard it as unsatisfactory, where a cargo-owner has found his goods

damaged through a defect in the seaworthiness of the vessel, that his rights of
recovering from the carrier should depend on particular circumstances in the
carrier’s situation and arrangements with which the cargo-owner has nothing to do;
as for instance, that liability should depend on the measure of control that the
carrier had exercised over persons engaged on surveying or repairing the ship or
upon such questions as whether the carrier had or could have done whatever was
needed by the hands of his own servants or had been sensible or prudent in getting
it done by other hands. Carriers would find themselves liable or not liable, according
to circumstances quite extraneous to the sea carriage itself.” 324
In another connection, in Maxine Footwear Co Ltd v Canadian Government Merchant

Marine Ltd, 325 it was held that the provisions of Article III(1) should not be construed to
mean two different instances (before, and at the beginning of the voyage), but rather
should be construed in continuity in order to provide uniformity in its application and so as
to impose the requirement on the carrier that his ship must be reasonably fit for the
contemplated voyage not only at the start of loading and the start of the voyage when the
ship sets in motion, but also the time between the loading and the sailing. 326
320
[2002] EWHC 1481 (comm).
321
322
323
[1961] AC 807.
324
325
Supra 324.
326
Chuah Law of International Trade 327-328; Carr International Trade Law 240-241.
44
Also, in enforcing the provisions of Article III(2) (above), the courts in Ministry of
Food v Lamport and Holt Line Ltd, 327 held that the carrier was liable for damage to cargo
caused by bad stowage due to his servants negligence. 328
In order to ascertain whether the carrier acted with due diligence with regard to the
cargo, the courts in Erdania SpA v Rudolf A Oetker (The Fjord Wind), 329 have established the
standard in terms of whether a reasonable person in the shoes of the defendant, with the
skill and knowledge that the defendant had or ought to have had, would have taken those
extra precautions, or whether the independent contractors’ survey had been as thorough as
they could reasonably have been expected to conduct in the circumstances. 330
Worthy of note is the fact that where a claimant alleges a breach of Article III(1) he
must show that the actual loss or damage was as a result of the ship’s unseaworthiness. The
courts contend that the claimant need not show that the ship’s unseaworthiness was the
only cause of the loss so long as it was a cause, as was seen in Smith Hogg & Co Ltd v Black
Sea & Baltic General Insurance Co Ltd. 331 per Lord Wright in this case:
“I can draw no distinction between cases where the negligent conduct of the master
is a cause and cases in which any other cause, such as perils of the seas, or fire is a
co-operating cause. A negligent act is as much a co-operating cause, if it is a cause at
all, as an act which is not negligent. The question is the same in either case, it is,
would the disaster not have happened if the ship had fulfilled the obligation of
seaworthiness even though the disaster could not have happened if there had not
also been the specific peril or action.” 332
3.2.2 DUTY TO CARE FOR THE CARGO
As provided by Article III(2), “subject to the provisions of Article IV, the carrier shall
properly and carefully load, handle, stow, carry, keep, care for and discharge the goods
carried”. Thus the carrier is liable for damage that occurs during the loading operation, as a
result of his servant’s negligence, 333 as was the case in Pyrene Co Ltd v Scindia Navigation Co
Ltd. 334 The term ‘carefully’ has been construed to mean reasonable care.335 More so, the
term ‘properly’ is not aimed at defining the scope of the carrier’s responsibility in the
loading process, but must be given regard as guidelines to be followed in rendering the
327
[1952] 2 Llotd’s Rep 371.
328
329
[2000] 2 Lloyd’s Rep 191.
330
Chuah Law of International Trade 327-328.
331
[1940] AC 997.
332
333
334
[1954] 2 QB 402.
335
45
service of loading. 336 In Albacora SRL v Westcott & Laurance Line, 337 where a cargo of fish
was being transported from Glasgow to Genoa, and the cargo deteriorated because it was
not stored in a refrigerator. The claimants sued the carrier on grounds of a breach of the
terms of Article III(2), the courts had to determine the meaning of the term ‘properly’ with
regard to this article. 338 Lord Reid stated to this effect that:
“the argument is that in this Article ‘properly’ means in the appropriate manner
looking to the actual nature of the consignment, and that it is relevant that the ship
owner and ship’s officers neither knew nor could have discovered that special
treatment was necessary. This construction of the word ‘properly’ leads to such an
unreasonable result that I would not adopt it if the word can properly be construed
in any other sense. The appellants argue that, because the article uses the word
‘properly’ as well as ‘carefully’, the word ‘properly’ must mean something more than
‘carefully’. Tautology is not unknown even in international conventions, but I think
that ‘properly’ in this context has meaning slightly different from ‘carefully’.
In my opinion, the obligation is to adopt a system which is sound in the light of all
the knowledge which the carrier has or ought to have about the nature of the goods
and, if that is right, then the respondents did adopt a sound system. They had no
reason to suppose that the goods required any different treatment from that which
the goods in fact received [at p 58].” 339
Also should the carrier fail to honor the provisions of Article III(2) he will not be able
to avail himself from liability based on his reliance to expert opinion. 340 It was held in
International Packers London Ltd v Ocean SS Co Ltd 341 that the carrier was in breach of
contract even though his actions were the direct result of advice given to him by a negligent
independent contractor. More so, the duty under Article III(2) extends to efforts taken to
protect or relieve the goods from circumstances caused by an earlier accident or danger,
even when that earlier danger was an excepted peril or was brought about without the
carrier’s fault.(Berlingieri 1991 LQR 18).342
The carrier may however relieve himself from the duty imposed on him under Article
III(2) to load, stow and discharge the goods, by including a clause into the contract that
transfers this duty to consignor, as was seen in Renton v Palmyra. 343 In this case, the House
of Lords supported the dicta Devlin J in Pyrene Co Ltd v Scindia Navigation Co Ltd, to which
effect:
336
337
[1966] 2 Lloyd’s Rep 53.
338
339
Note 66 in Carr International Trade Law 245.
340
341
[1955] 2 Lloyd’s Rep 218.
342
343
[1957] AC 149.
46
“the extent to which the carrier has to undertake the loading of the vessel may
depend not only upon different systems of law but upon the custom and practice of
the port and nature of the cargo. It is difficult to believe that the Rules were
intended to impose a universal rigidity in this respect, or to deny freedom of contract
to the carrier. The carrier is practically bound to play some part in the loading and
discharging, so that both operations are naturally included in those covered by the
contract of carriage. But I see no reason why the Rules should not leave the parties
free to determine by their own contract the part which each has to play. On this view
the whole contract of carriage is subject to the Rules, but the extent to which loading
and discharging are brought within the carrier’s obligations is left to the parties
themselves to decide.” 344
3.2.3 DUTY TO ISSUE THE BILL OF LADING
Article III(3) provides that the carrier is obliged to issue a bill of lading which
stipulates amongst other things, the leading marks; the number of packages or pieces, the
quantity or weight of the goods; the apparent order and condition of the goods. 345 The issue
of the bill of lading is only mandatory upon the request of the consignor, and the carrier is
under no obligation to hand the bill of lading to any other person than the consignor.346
Article III(3) further provides that the carrier may include reservations in the bill of lading.
Where the carrier or his agents have reasonable cause to believe that the leading marks,
numbering or weight are not accurately represented, or he has not the means of asserting
the veracity of the terms of the received bill of lading, he is not bound to include these
marks in the shipped bill of lading. 347 In The Esmeralda, 348 it was seen that the carrier could
qualify entries referring to the weight and quantity of the goods with terms such as ‘weight
unknown’, ‘quantity unknown’. Where such clauses are incorporated into the bill of lading it
automatically ceases to serve as prima facie evidence of the weight and quantity of cargo
shipped against the carrier. 349
Per Article III(4), the bill of lading shall serve as prima facie evidence of the state in
which the carrier receives the goods. The carrier may provide evidence of the contrary
whilst the bill of lading is in the possession of the consignor, but once the bill has been
passed to a bona fide third party such evidence against statements in the bill of lading shall
not be admissible in court. 350
344
345
Supra 336.
346
Supra 337.
347
Supra 337.
348
[1988] 1 Lloyd’s Rep 206.
349
350
Supra 247.
47
Under the provisions of Article III(5), the carrier is entitled to indemnity from the
consignor for any false statements incorporated into the final bill of lading as a result of
misleading facts provided by the consignor, as was seen in The Boukadoura. 351 This
indemnity shall nevertheless reduce the carrier’s liability to third party interests under the
contract of carriage.352
3.2.4 DUTY NOT TO DEVIATE
The carrier is under a general duty to proceed on the contract voyage.353 According
to Article IV(4), “any deviation in saving or attempting to save life or property at sea or any
reasonable deviation shall not be deemed to be an infringement or breach of these rules or
of the contract of carriage, and the carrier shall not be liable for any loss or damage
resulting therefrom.” 354 The question that arose from the interpretation of this article has
been whether a deviation by the carrier for the sole purpose of saving property is justified
under the Rules, or such deviation finds justification only if it occurred for the purpose of
saving a life. 355 Should the provisions of Article IV(4) be so construed as to justify a deviation
by the carrier to salvage property irrespective of any other circumstances, then Article III(4)
shall have the effect of excluding the carrier from liability under Article IV(5), which excludes
the carrier from the benefit of the limitation of liability should it be established that the
damage was a result of an act or omission of the carrier performed with such damage
intended or carelessly knowing that such act would likely result in damage. 356 However, it is
advised that the better approach at the provisions of Article IV(4) would be to justify
deviation to save property in the course of saving a life, or deviation in order the save the
voyage. 357 The courts in Stag Line v Foscola, Mango and Co, 358 held that for a deviation
within the provisions of Article IV(4) to be justified, such a deviation must be a reasonable
one. 359 The House of Lords in an attempt to determine the scope of a ‘reasonable deviation’
received numerous meaning brought forward by their lordships,360 but much credit is given
to that of Lord Atkin who suggested that a deviation should not be confined simply to a
question of:
351
[1986] 1 Lloyd’s Rep 393.
352
353
354
355
356
Supra 248.
357
358
[1932] AC 328.
359
360
Carr International Trade Law 249; Todd Cases and Materials 510-513.
48
“a deviation to avoid some imminent peril; or deviation in the joint interest of cargo
owner or ship; or deviation as would be contemplated by both cargo owner and
ship.” 361
Lord Atkins further states that:
“a deviation may, and often will, be caused by fortuitous circumstances never

contemplated by the original parties to the contract; and may be reasonable,
though… indeed in the direct interest of neither: as for instance where the presence
of a passenger or of a member of the ship or crew was urgently required after the
voyage had begun or on a matter of national importance; or where some person on
board was a fugitive from justice, and there were urgent reasons for his immediate
appearance. The true test seems to be what departure from the contract voyage
might a prudent person controlling the voyage at the time make and maintain,
having in mind all the relevant circumstances existing at the time, including the
terms of the contract and the interests of all parties concerned, but without
obligation to consider the obligation of anyone as conclusive.” 362
It is settled that express terms in the contract that permit deviation will only
determine the scope of the contract voyage and not affect the application of the provisions
of the Rules which regulate the terms on which the voyage is to be performed. 363
3.3 EXEMPTIONS TO CARRIERS’ LIABILITY UNDER THE HAGUE-

VISBY RULES:
The Hague-Visby Rules provide an extensive list of exclusionary clauses in favour of
the carrier which are quite similar to those awarded at Common Law. But unlike at Common
Law, the carrier under the Rules cannot increase the list of exceptions provided by the
Rules. 364 In the words of Wright J in Gosse Millard v Canadian government Merchant
Maine, 365 “Article IV of the Rules contains a long list of matters in respect of loss or damage
arising or resulting from where the carrier is not liable.” 366
Article IV provides that:
“neither the carrier nor the ship shall be liable for loss or damage arising or resulting
from unseaworthiness, unless caused by want of due diligence on the part of the
361
362
363
364
365
1927 2KB 432.
366
49
carrier to make the ship seaworthy, and to secure that the ship is properly manned,
equipped and supplied, and to make the holds, refrigerating and cool chambers and
all other parts of the ship in which goods are carried fit and safe for their reception,
carriage and presentation in accordance with the provisions of the paragraph 1 of
Article III.”
Whenever loss or damage has resulted from unseaworthiness the burden of proving
the exercise of due diligence shall be on the carrier or other person claiming exemptions
under this article.367
Article IV(2) further states that, neither the carrier nor the ship shall be responsible for loss
or damage arising of resulting from:
3.3.1 NEGLIGENCE IN NAVIGATION OR MANAGEMENT OF THE SHIP
The carrier is exempt from liability for any act, neglect or default of the master,
mariner, pilot or the servants of the carrier in the navigation or management of the ship.
Thus, the carrier could rely on the provisions of this clause if damage or loss resulted from a
fault in navigation or management of the ship. 368
A fault in navigation has been defined in The Ferro, 369 as “something affecting the
safe sailings of the ship.” 370 On the other hand, determining what amounts to a fault in
management has been more complex. It has however been held that a fault in the
management of the ship must be established as a matter of fact for the carrier to a benefit
of the protection of Article IV(2)(a). In Goose Millerd Ltd v Canadian Government Merchant
Maine Ltd, 371 Lord Hailsman L.C upheld the ruling in The Glenochil, 372 where in Gorell Barnes
J held:
“There will be found strong and marked contrast in the provisions which deal with
the care of the cargo and those which deal with the management of the ship herself
and I think that where the act done in the management of the ship is one which is
necessarily done in the proper handling of the vessel, though in this particular case
the handling is not properly done, but is done for the safety of the ship herself, and
is not primarily done at all in connection with cargo, that must be a matter which
falls within the words (management of the vessel).” 373
It stands to reason from presented facts that where loss or damage to cargo resulted
from the negligence of the master or his crew to exercise due diligence in the management
367
Supra 334.
368
369
[1893] 38.
370
371
[1929] AC 223.
372
[1896] 10.
373
50
of the cargo, the carrier cannot benefit from the exemption provided under Article IV(2) (a).
For such exemption to avail the carrier, the fault must be one committed in the
management of the ship itself as was reiterated by Greer L.J in the Goose Millerd case: 374
“If the cause of the damage is solely, or even primarily, a neglect to take reasonable
care of the cargo, the ship is liable, but if the cause of damage is a neglect to take
reasonable care of the ship, or some part of it, as distinct from cargo, the ship is
relieved from liability; but if the negligence is not negligence towards the ship, but
only negligent failure to use the apparatus of the ship for the protection of the cargo,
the ship is not so relieved.” 375
3.3.2 FIRE
Article IV(2) (b) exempts the carrier from liability for loss or damage caused by fire,
unless the fire was caused by the actual fault or privity of the carrier. 376
In Tempus Shipping Co v Louis Dreyfus, 377 the courts held that mere heating without
flames does not fall within its definition of fire.378 It is held that the carrier forfeits his right
to the defence of Article IV(2)(b) if the loss or damage result from a fire caused by the
carrier’s lack of due diligence to render the vessel seaworthy, as was seen in Maxine
Footwear Co Ltd v Canadian Merchant Marine. 379
Determining actual fault or privity on the part of the carrier is a matter of fact. This is
made difficult in situations where the carrier is a company, as companies are inanimate
entities that act through animate beings, and sometimes it is difficult to impute the
negligent acts of persons working in a company to the actual acts of the company. 380 It was
held in Lennard’s Carrying Co Ltd v Asiatic Petroleum co Ltd, 381 that liability will lie on the
company where the individual working for the company enjoys a relationship with the
company wherein it stands to reason that the individual is the directing mind or the brain of
the company, as stated by Viscount Haldane:
“…the fault or privity is the fault or privity of somebody who is not merely a servant
or agent for whom the company is liable upon the footing respondeat superior, but
somebody for whom the company is liable because his action is the very action of
the company itself. It is not enough that the fault should be the fault of a servant in
374
Supra 331.
375
Supra 332.
376
Supra 333.
377
[1930] 1KB 699.
378
379
[1959] 2 Lloyd’s Rep 105.
380
381
[1915] AC 705.
51
order to exonerate the owner, the fault must also be one which is not the fault of
the owner, or a fault to which the owner is privy.” 382
3.3.3 PERILS OF SEA
Per Article IV(2)(c), the carrier shall not be liable for loss or damage to the goods
where they resulted from the perils, dangers and accidents of the sea or other navigable
waters. 383
It is highly probable that the definition of ‘perils of the sea’ under the Rules be
similar to that under the English common law. 384 At Common Law, perils of sea refer to any
damage caused by storms, sea waters, collision, stranding and other perils likely to affect a
ship at sea, to which no measure of due diligence exercised by the carrier could have
avoided their consequences. 385 In Hamilton Fraser and co. v Pandorf and Co, 386 this
exception was limited only to perils encountered only at sea, nor would it apply to any other
medium of transportation. 387 Per Lord Herschell in The Xantho: 388
“they do not protect, for example, against that natural and inevitable action of the
winds and waves, which result in what may be described as wear and tear. There
must be some casualty, something which could not be foreseen as one of the
necessary incidents of the adventure.” 389
3.3.4 ACT OF GOD
The exception to liability for damage or loss caused by an Act of God is provided by
the Article IV(2)(d). 390 This provision has been interpreted at Common Law to mean any act
by which no degree of human intervention, precaution or foreseeability could have
prevented the result.391 This was upheld in Nugent v Smith, 392 where the courts held that
the loss of a horse as a result of injuries sustained during a storm could not have been
prevented through any means by the carrier. 393
382
383
Supra 255.
384
385
386
[1887] 12 AC 518.
387
388
[1887] 12 App Cas 503.
389
390
Supra 334.
391
392
(1876) 1 CPD 423.
393
52
3.3.5 ACT OF WAR, PUBLIC ENEMIES AND RIOT
Article IV(2)(e) provides that the carrier is not liable for loss or damage to goods that
resulted from an act of war. The courts in Kawasaki v Brantham SS Co, 394 defined war as a
situation of hostility between two states and the exclusion may extend to civil war
situations.395
Article IV(2)(f) further provides exemption from liability to the carrier for loss or
damage caused by an act of public enemies. Per Article IV(2)(k) the carrier will be exempt
from liability that results from disturbances such as riots and civil unrest. 396
3.3.6 ACT OF AUTHORITIES AND QUARANTINE
In conformity with Article IV(2)(g), the carrier is exempt from liability for loss or
damage due to the arrest or restraint of princes, or rulers or people, or seizure under legal
process. This provision has been interpreted at Common Law to cover circumstances
wherein loss or damage is caused due to the government of a country placing an embargo
on the goods or where such government placed a prohibition against the import of the
goods. Article IV(2)(h) goes further to exempt the carrier where the goods cannot be
discharged due to quarantine restrictions. 397
3.3.7 ACT OR OMISSION OF THE CONSIGNOR
Article IV(2)(i) relieves the carrier from liability where the loss or damage to the
cargo is due to an act or omission of the consignor or owner of the goods, his agent or
representative. This provision considers the possibility that goods in the carrier’s possession
may suffer loss or damage due to inaccurate directives provided by the consignor with
regards to their handling. 398
3.3.8 STRIKES AND LOCKOUTS
Article IV(2)(j) relieves the carrier from liability for loss or damage due to strikes or
lockouts or restraints of labour from whatever cause, whether partial or general. Lord
Denning defines ‘strike’ in The New Horizon, 399 as:
394
[1939] 2 KB 544.
395
396
Supra 256.
397
398
399
[1975] 2 Lloyd’s Rep 314 317.
53
“… a conceited stoppage of work done by men with a view to improving their wages
or conditions, or giving vent to grievance, or making a protest about something or
other, or supporting or sympathising with other workmen in such endeavour. It is
distinct from a stoppage brought about by an external event such as bomb scare or
by apprehension of danger.” 400
3.3.9 SAVING LIFE OR PROPERTY AND DEVIATION
Article IV(2)(1) exempts the carrier for loss or damage to goods due to an attempt to
save a life or property at sea. This provision will apply where the carrier pursuing the
contracted route causes damage or loss of the cargo. Mention is not made in the provision
as to its applicability where the loss or damage was the result of a deviation from the
contracted route to save a life. 401 However, Article IV(4) exempts the carrier from liability
for loss or damage to the goods resulting from a reasonable deviation. 402 Should the
deviation be deemed a wrongful one, the carrier loses the defence under Article IV(2). 403
3.3.10 WASTAGE AND INHERENT VICE
In accordance with Article IV(2)(m), the carrier is exempted from liability due to
wastage in bulk or weight or any other loss or damage arising from an inherent defect,
quality or vice of the goods. 404 Inherent vice has been defined to mean an inability borne of
the very nature of the particular good to overcome the ordinary incidents of the voyage
regardless of the exercise of all due diligence necessary for the care of the goods. 405 This
defence has found explanation at Common Law in The Barcore: 406
“[The] cargo was not damaged by reason of the [carrier] committing a breach of
contract, or omitting to do something which he ought to have done, but it was
deteriorated in condition by its own want of power to bear the ordinary transit in a
ship.” 407
400
401
Supra 257.
402
403
404
Supra 335.
405
406
[1896] 294.
407
54
3.3.11 DEFECTIVE PACKING AND MARKING
Article IV(2)(n) provides that the carrier is not liable for loss or damage due to an
insufficiency of packing. In Silver v Ocean Steamship Co, 408 it was held that goods shall be
deemed insufficiently packed if they cannot bear the likely manoeuvres which such goods
are likely to undergo in the course of the voyage. However, the carrier shall be estopped
from pleading this defence where he issued a clean bill of lading to a bona fide consignee or
endorsee. 409
Article IV(2)(o) further exempts the carrier from loss or damage to the goods due to
insufficiency or inadequacy of marks placed on the goods. Like under Article IV(2)(n), should
the carrier transfer a bill of lading to a bona fide third party, he forfeits his defence. 410 Be
that as it may, where it is established that the marks on the bill of Lading are inaccurate, in
conformity with Article III(5), the carrier can claim indemnity from the consignor. 411
3.3.12 LATENT DEFECTS
Per Article IV(2)(p), the carrier is not liable for loss or damage to goods caused due to
latent defects not discoverable by due diligence. The latent defects do not refer to defects in
the goods, but latent defects in the vessel transporting the goods. 412 It is supposed that this
provision adds to the immunity provided to the carrier under Article IV(1), as it will cover
defects which the carrier couldn’t have discovered through the exercise of due diligence,
and where the carrier could not establish as a matter of fact that he had exercised due
diligence.413
3.3.13 CATCH ALL EXEPTION
Article IV(2)(q) provides a ‘catch all exception’ as it states that neither the carrier nor
the ship is liable for loss or damage that arises or results from any other cause arising
without the actual fault or privity of the carrier, or without the fault or neglect of the agents
or servants of the carrier. 414
Commentators have opined that this provision cannot be given an ejusdem generis
interpretation since the exceptions under Article IV(2) do not form a single genus. Thus the
provisions must be regarded as covering circumstances not referred to under Article IV
408
[1930] 1 KB 416.
409
410
Supra 257.
411
412
413
414
55
(2)(a)-(p). 415 However, this is not a common defence sought by carriers, and this is due to
the fact that firstly, the provisions of Article IV(2) are very extensive, not covering only the
rarest situations; and secondly, in order for the carrier to use this defence he must establish
that neither he or his crew were negligent or at fault.416
It is unlikely as it seems that this defence be sought by the carrier due to his burden
of proof,417 but it does not fall short of usefulness, as it was employed with success in Leesh
River Tea Co v British India Steam Navigation. 418
3.4 LIMITATION OF CARRIERS’ LIABILITY UNDER THE HAGUE-VISBY

RULES
Although the Hague Visby Rules seemingly favour the carrier with the numerous
defences it provides to its liability, the Rules also provide limits to his liability. 419
Per Article IV bis(1), the defences and limits of liability available to the carrier of
goods shall apply in an action for loss or damage to goods covered by the contract of
carriage whether the action is brought on contract or in tort. In conformity with Article IV
bis(1) and (2), the defences and limits to liability apply to the carrier and his servants or
agents, provided such servant or agent is not an independent contractor. 420 However, the
carrier may extend the cover of Article IV bis(1) and (2) to independent contractors by
expressly including them in a clause in the bill of lading. Such a clause is known as the
‘Himalaya’ clause, 421 which owes its name after the vessel in Adler v Dickson. 422 In New
Zealand Shipping Co Ltd v AM Satterthwaite and Co Ltd (The Eurymedon), 423 Lord
Wilberforce said that such a clause will be effective with regards to independent contractors
to include; exemptions, limitations, defences and immunities contained in the bill if the
lading.424 Apart from the defences awarded to the carrier under the Rules, the Rules also
provide for a financial limit in damages claimed, as well as a time limit within which action
must be brought against the carrier.425
Per Article IV(5)(a) the sum of liability shall be calculated in terms of package, unit or
weight of the goods, and it is at the discretion of the consignor to use the measure of
415
416
417
418
[1966] 2 Lloyd Rep 193.
419
420
421
422
[1954] 2 Lloyd’s Rep 267.
423
[1975] AC 169.
424
425
56
calculation that provides a higher amount in damages. 426 Where the consignor makes use of
a container for the carriage of his goods, Article IV(5)(c) further provides that:
“Where a container, pallet or a similar article of transport is used to consolidate the

goods, the number of packages enumerated in the bill of lading as packaged in such
article of transport shall be deemed the number of packages or units concerned.
Except as aforesaid, such article shall be considered the package or unit.” 427
3.4.1 FINANCIAL LIMITATION
Article IV(5)(d) provides that the unit of account for calculation purposes in the
Special Drawing Right, 428 as defined by the International Monetary Fund(IMF). 429 The Rules
provide a limit for recoverable damages. This serves to encourage carriers to offer lower
freight rates, provided the law limits their liability in the carriage of goods whose value is
not disclosed by the consignor. 430
Article IV(5)(a) of the Rules limits the amount payable by the carrier in the event of
loss or damage to 666.67 units of account per package or unit or 2 units of accounts per kilo
of gross weight of the goods lost or damaged, whichever is the higher, provided the value of
the goods at the time of shipment had not been declared by the consignor. However, Article
IV(5)(f) provides that should the consignor declare the value of goods and inserts the
declaration into the bill of lading, it shall only serve as prima facie evidence of the amount
declared, but shall not bind the carrier. Article IV(5)(g) further states that by mutual
agreement between the carrier or his agent and the consignor, the limit may be increased
to one higher than prescribed by the Rules. However the limit may not be set lower if not it
shall be void in conformity with the provisions of Article III(8). 431 More so, under Article
IV(5)(e), neither the carrier nor the ship shall benefit of the limitation of liability provided in
Article IV(5)(a), if it is established that the damage resulted from an act or omission of
carrier done with intent to cause damage, or recklessly, and with knowledge that damage
would probably result.
3.4.2 TIME LIMITATION
Article III(6) provides that the carrier and the ship shall in any event be discharged
from all liability whatsoever in respect of the goods, unless suit is brought within one year of
their delivery or of the date when they should have been delivered. This period may
426
427
Supra 264.
428
Hereinafter referred to as SDR.
429
430
431
57
however be extended if the parties so agree after the cause of action has arisen. The parties
however, may not agree to reduce this period. 432
The provisions of this article imply that should the claimant fail to bring an action
against the carrier within one year of him having delivered the goods, or one year from the
time when the carrier was expected to have made the delivery, the carrier shall be exempt
from all liability for loss damage to the goods after this time limit.433 The courts have
adopted a strict approach to this time limitation which operates to the favour of the
defendant (the carrier), 434 as was seen in Compania Culumbiana de Seguros v Pacific SN
Co. 435 In conformity with Article III (6) bis, an action for indemnity against a third party may
be brought outside of the one year time limit, provided such an action is brought within the
period permitted by the law of the court seized of the matter. This time shall however not
be less than three months, beginning from the day when the party seeking indemnity has
settled the claim or has been served with process in the action against him.
3.5 CONCLUSION
The objective of the Hague-Visby Rules was to protect the interest of the consignor,
and any other party with bona fide claim to the goods in the possession of the carrier from
the inexhaustible lists of exclusionary clauses incorporated into the bill of lading by the
carrier. 436 To this effect, Article III(8) provides that any attempt to derogate from the liability
imposed under the Rules will be null and void.437 In this light, it was held in The Hollandia,438
that the carrier will not reduce the limits of his liability by including a choice of forum clause
in the contract. Lord Diplock contended that a choice of forum clause that seeks to reduce
the liability under the Rules is void, and he further stated that to grant assent to such
provision:
“would leave it open to any ship-owner to evade the provision of Article III
paragraph 8 by the simple device of inserting in his bills of lading issued in, or for
carriage from a port in, any contracting state a clause in standard form providing as
the exclusive forum for resolution of disputes what might aptly be described as a
court of convenience, viz, one situated in a country which did not apply the Hague-
Visby Rules or, for that matter, a country whose law recognised an unfettered right
432
Note 153 in Carr International Trade Law 267.
433
434
435
[1963] 2 Lloyd’s Rep 527.
436
Wanigasekera “Comparison of Hague-Visby and Hamburg Rules”1.
437
438
[1985] 1 AC 565.
58
in a ship-owner…to relieve himself from all liability for loss or damages to goods
caused by his own negligence, fault or breach of contract.” 439
Be that as it may, the provisions of the Rules still contain numerous exceptions to
liability that operate in favour of the carrier, to which no better justification could be made
than the simple desire to exempt him from liability for loss or damage of goods in his
care. 440
The Second World War caused significant economic and political changes across the
world. Many nations in Asia and Africa gained independence, and soon thereafter joined the
international trade transaction as exporters (consignors). These new countries contributed
to about 65% of all maritime shipment. Despite this great input to maritime commerce, this
business of carriage was still dominated by the industrialised countries that possessed 93%
of mercantile fleets. 441 The domination of the carriage business by the developed nations
enabled them to subject the consignors to their terms of contract which were considered
detrimental to the developing nations. These developing nations saw the need for a new
convention that will replace the old and out-dated Hague regime, and place them on level
ground with the developed nations. In the light of this, the developing nations urged the
international community to review the Rules on carriage by sea, which led to the
development of a new law of the sea called the United Nations Convention on Carriage of
Goods by Sea 1978, commonly known as the Hamburg Rules.
439
440
Zamora American Journal of Comparative Law 418-419 http://www.jstor.org/stable/839373.
441
Karan H “Any Need for a New International Instrument on the Carriage of Goods by Sea: The Rotterdam
Rules?” 2011 (42) Journal of Maritime Law & Commerce 441-451 446
17/11/2011).
59
CHAPTER FOUR
CARRIERS’ LIABILITY UNDER THE
HAMBURG RULES AND REASONS FOR
THEIR FAILURE
4.1 INTRODUCTION
The greatest impediment to the laws regulating the carriage of goods by sea has
been the validity of the numerous exclusionary clauses included into the bill of lading, that
aim to reduce the carriers liability under the contract of carriage. 442 Early disparity in the law
of nations in relation to this issue led to an urge for compromise and international
unification of trade legislations, which culminated in the adoption of the Hague Rules in
1924, and subsequent revision of these Hague Rules by the United Nations Conference on
Trade and Development (UNCTAD) to meet needs of economic development.443 More so, by
the end of the 1960’s, the Hague-Visby Regime, 444 had obtained great criticism from
developing countries. Representatives of developing countries, as well as some developed
countries, contended that their nationals were mainly consignors, and were on the losing
end of the bargain in relation to the carriers, given the terms of the contract of carriage.
Moreover, most of these developing countries were not consulted before the drafting of the
existing international legislation on carriage.445
Some of the reasons that encouraged the need for a new law regulating sea carriage
were the following; 446
• The burden of proof under the Rules weigh too heavily on the consignor;
• The long list of exclusionary clauses included in the bill of lading by virtue of Article
IV(2), operate solely to the benefit of the carrier. Per Article IV(2)(a), the Rules allow
442
Sinha 1979 American Journal of Comparative Law 353 http://www.jstor.org/stable/840038.
443
Supra 353.
444
445
Sinha 1979 American Journal of Comparative Law 354 http://www.jstor.org/stable/840038 .
446
60
the carrier to escape liability for the ‘act neglect or default of the master, mariner,
pilot, or the servants of the carrier in the navigation or in the management’. Such an
exclusion from liability is unacceptable, provided it would bad policy to exempt the
carrier from liability for a negligent act committed aboard his vessel while he was in
control of it.447 Also in Leesh River tea Co v British Steam Navigation, 448 the catch all
exception provided by Article IV(2)(q) frees the carrier from liability not covered by
the provision of Article (1)(a-p);
• Loss due to delay in delivery is not specifically covered by the Rules as seen in Anglo-
Saxon Adamastos Shipping Co; 449
• It is difficult to identify the party against whom action must be brought under a
contact of carriage; hence the One year time line limit for action to be bought
against a carrier is too short; 450
• The carriers tended to include unfair clauses in the bill of lading with regard to
jurisdiction and arbitration because the Rules failed to make provisions to this
effect; 451
• The Rules applied only to contracts of carriage evidenced by a bill of lading; 452
• The application of the Rules did not extend to any period of storage, or consolidation
of the goods at the port of shipment, though the goods have been delivered to the
carrier. 453
In the light of the foregone, UNCITRAL took over the task of drafting a new
convention.454 UNCITRAL formed a working group made up of representatives of 21
member states selected on basis of geographic distribution and representation of the
economic interest involved, and also considering different legal systems. This working Group
prepared a draft convention for review by UNCITRAL, which was approved in May 1976 as
the Draft Convention on the Carriage of Goods by Sea. From the 6-31 of March 1978 a
United Nations conference on Carriage of Goods by sea, held at Hamburg, received the
Draft Convention and draft provisions regarding its implementation, reservations and other
clauses, as prepared by the UN secretariat for consideration. On the 30th of March, the
conference adopted the text of the United Nations Convention on the Carriage of Goods by
447
Gosse Millerd v Canadian Government (1927) 44 TLR 143 151.
448
[1966] 3 A11 ER 593.
449
[1957] 1 Lloyd’s Rep 79.
450
451
Supra 292.
452
453
Supra 353.
454
61
Sea, 1978 (The Hamburg Rules). 455 The Hamburg Rules exists alongside The Hague Rules and
Hague-Visby Rules,456 and most recently, the Rotterdam Rules.
4.2 MAJOR CHANGES BROUGHT TO THE HAGUE-VISBY RULES BY

THE HAMBURG RULES
4.2.1 SCOPE OF APPLICATION
The Hamburg Rules were developed to take over the Hague/Hague-Visby regimes.457
One major change brought about by the Hamburg Rules to The Hague/Hague-Visby regimes
can be seen from their title, the ‘Convention on the carriage of goods by Sea’. Thus while
the Hague/Hague Visby regimes apply to ‘Certain Rules of Law relating to Bills of Lading’,
The Hamburg Rules simply apply to contracts of Carriage of Goods by Sea.458 Article 3 of the
Hamburg Rules provides that, “in the interpretation and application of the provisions of this
convention, regard shall be had to its international character and need to promote
uniformity.” 459 The Hamburg Rules shall apply to all “contracts of carriage by sea between
two different states”, unlike the Hague/Hague-Visby Rules which limits their application only
to contracts of carriage by sea evidenced by a bill of lading. 460 Per Article 2 of the Hamburg
Rules, the convention shall apply where: 461
“The port of loading as provided for in the contract of carriage is located in a

contacting state; the port of discharge as stated in the contact of carriage is located
in contracting state; or one of the optional ports of discharge turns out to be actual
port of discharge as stipulated in the contract and such a port is located in a
contracting state; or the bill of lading or other document evidencing the contract of
carriage is issued in a contracting state; in circumstances where the provisions of the
bill of lading or other document evidencing the contract of carriage by sea provides
that the Hamburg Rules apply.” 462
As such, carriage to and from a contracting state shall attract the application of The
Hamburg Rules as seen in the case of Compagnie Sénéglaise d’Assurances et de
455
Sinha 1979 American Journal of Comparative Law 355 http://www.jstor.org/stable/840038.
456
457
Murray DE “The Hamburg Rules: A Comparative Analysis” 1980 (12) Lawyer of the Americas 59-92 59
http://www.jstor.org/stable/40175868 (Accessed: 11/08/2011 07:31).
458
Ramberg J “The Vanishing Bill of Lading & the ‘Hamburg Rules Carrier’” 1979 (27) American Journal of
Comparative Law 391-406 391 http://www.jstor.org/stable/840041 (Accessed: 11/08/2011 07:31).
459
Murray 1980 Lawyer of the Americas 59 http://www.jstor.org/stable/40175868.
460
461
Supra 353.
462
Explanatory note by UNCITRAL secretariat on the United Nations Convention on the carriage of Goods by
Sea 1978(Hamburg)(A/CN. 9/306) 11
62
Réassureance CSA and 27 Other Companies v Rascoe Shipping Co, the Captain of the Ship
‘World Appolo’, and the Steaming Mutual Underwriting Association. 463 This is a major
improvement to the Hague-Visby Rules which apply only to outward carriage from a
contracting state.464 It should also be noted that the application of the provision of The
Hamburg Rules is not subject to physical contact with a contracting state, provided the
parties thereto expressly agree in contract that the provisions of The Hamburg Rules, or the
laws of a state that implements The Hamburg Rules are to govern the contract of
carriage. 465
More so, per Article 2(3), The Hamburg Rules shall not apply to charter parties unless
a bill of lading was issued under such a charter party with the intention that the terms in
that bill of lading regulate the relationship between the carrier and the holder of the bill
who is not a charterer.466 Be that as it may, a major drift from the Hague regime by the
Hamburg Rules is the fact that the provisions of the Hamburg Rules will apply to contracts of
carriage regardless of whether or not a bill of lading has been issued.467 Unlike under the
Hague/Hague-Visby regimes, the Hamburg Rules do not apply only to negotiable bills of
lading, their provisions will apply to non-negotiable bills of lading, seaway bills and
electronic documents. 468
Also, under the Hague-Visby Rules, the carrier, if liable for loss or damage to goods in
his possession, this liability shall attach to him only if it occurred from the time when the
goods were loaded on board his ship to the time when they are discharged, unless, this
period of liability was extended by the parties by mutual agreement, such that it extends to
the management of the cargo before loading and subsequent to their discharge from the
ship. But still, the limitation of liability awarded the carrier under the Hague Visby Rules still
operate in favour of the carrier irrespective of the agreement. 469 The Hamburg Rules change
this position of the carrier as Article 4(1) provides that the carrier shall not only be liable for
the period of carriage, but also for the period during which the goods are in his custody at
the port of loading and at the port of discharge. 470 In other words, the Hamburg Rules
provide that the carrier is liable from the time the goods are in his possession until he either
delivers them to the consignee, or places the goods at the consignees disposal in conformity
with contracted terms, law or custom applicable to the transaction at the port of discharge,
463
UNCITRAL A/CN.9/SER.C/ABSTRACTS 11, 2 December 1996 (Case 159) Commercial Court of Marseilles
(France).
464
465
Supra 296.
466
Explanatory note by UNCITRAL Secretariats on the United Nations Convention on the Carriage of Goods by
Sea 1978(Hamburg)(a/CN. 9/306) 12.
467
468
469
Murray 1980 Lawyer of the Americas 61-62 http://www.jstor.org/stable/40175868.
470
Honnold J “Ocean Carriers and Cargo; Clarity and Fairness-Hague or Hamburg?” 1993 (24) Journal of
Maritime Law and Commerce 75-109 82 Sabinet (Accessed: 24/10/2011).
63
or delivers the goods to a third party or an authority entitled to receive the goods by
operation of law or custom of the port of discharge. 471
Also, the Hamburg Rules resolve the problem under the Hague-Visby Rules of
determining who the ‘carrier’ is when two or more carriers are involved in the carriage of
the goods.472 The Hamburg Rules provide a distinction between a carrier and an actual
carrier so as to ease the process of any claimant’s recourse to litigation, by identifying the
party against whom an action can be brought.473 Per Article 1, a carrier is defined as ‘any
person by whom or in whose name a contract of carriage of goods by sea is concluded with
any (consignor)’. This has been interpreted to include the ship owner, the charterer, the
freight forwarder or any transport operator who has entered into the contract of
carriage. 474 The actual carrier is defined in Article 1 as ‘any person to whom the
performance has been entrusted’. From the wordings of Article 10(1), it can be understood
that the contracting carrier is liable for the entire journey as it states that:
“Where the performance of the carriage or part thereof has been entrusted to an
actual carrier, whether or not in pursuance of a liberty under the contract of carriage
by sea to do so, the carrier nevertheless remains responsible for the entire carriage
... The carrier is responsible, in relation to the carriage performed by the actual
carrier and of his servants and agents acting within the scope of their
employment.” 475
Be that as it may, the actual carrier shall bear liability only for his leg of the carriage.
Per Article 11(1) the contract carrier shall exempt himself from liability for loss or damage to
the goods while in the custody of the actual carrier if he named such actual carrier, as well
as specified details about his leg of the carriage in the contract of carriage. Worthy of note is
the fact that this exclusion from liability by the contracting carrier shall only avail him if it is
possible for the proceedings to be brought against the actual carrier within the provisions of
Article 21(1)(2). Despite this requirement, the contracting carrier has recourse to claim from
the actual carrier for any indemnity paid to cargo claimants. 476
Furthermore, The Hamburg Rules will cover the carriage of all kinds of goods,
including live animals per Article 5(5), and deck cargo provided he conforms to the specific
rules regulating the carriage of such cargo per Article 9. Carriage of deck cargo by
agreement between the parties was not covered under the Hague Rules due to the high
risks of loss involved. With developments in transport practices such as the use of
containers, the risk is now manageable. The Hamburg Rules thus allow the carrier to carry
goods on deck, not only by agreement with the consignor, but if such deck carriage
conforms to the custom of the particular trade or if it is legally sanctioned. Under the
471
472
Selvig 1979 American Journal of Comparative Law 369 http://www.jstor.org/stable/840040.
473
474
Supra 298.
475
476
Supra 354-355.
64
Hamburg Rules however, the carrier shall be held liable for loss, damage or delay relating to
the permitted deck cargo based on a presumption of fault or neglect. The carrier losses the
right to the defence if the cargo had been carried on deck without prior agreement with the
consignor.477
4.2.2 CARRIER’S DOCUMENTARY RESPONSIBILITY
Article 14(1) of the Hamburg Rules provides that on the request a consignor, the
carrier must issue a bill of lading. Per Article 15(1) and (2) the bill of lading issued by the
carrier must contain particulars that relate to the cargo. However, failure on the part of the
carrier to describe some of the particulars of the cargo shall not impede on the legitimacy of
the bill of lading as provided by Article 1(7). 478 The carrier or any other person issuing the
bill of lading may include reservations on the bill relating to the general nature of the cargo,
where they had no reasonable means of verifying the particulars of the cargo, or has
knowledge or reasonable cause to believe that the description provided him was
incorrect.479 Thus, where the consignor makes entries in the bill of lading, which the carrier
can’t reasonably check, he may enter a reservation on such a bill with a phrase such as ‘said
to contain.’ 480
4.2.3 LIABILITY OF THE CARRIER UNDER THE HAMBURG RULES
The carrier’s liability under the Hamburg Rules is based on a presumption of fault.481
Article 5(1) of the Hamburg Rules provides that:
“the carrier is liable for loss resulting from loss of or damage to the goods, as well as
from delay in delivery, if the occurrence which caused the loss, damage or delay in
delivery took place while the goods were in his charge as defined in Article 4, unless
the carrier proves that he, his servants or agents took all measures that could
reasonably be required to avoid the occurrence and its consequences.” 482
This is a major development from the liability regime under the Hague-Visby Rules,
as it changes the fundamental rules on the allocation of risks between the consignor and the
carrier, where at first the burden was on the claimant to prove the fault of the carrier, but
477
Yearbook of UNCITRAL 1988(19) 105.
478
Carr International Trade Law 300; per Article 1(7) a bill of lading is ‘a document which evidences a contract
of carriage by sea and the taking over as the loading of goods by the carrier, and by which the carrier
undertakes to goods deliver the goods against its surrender. A provision in the document that the goods
are to be delivered to the order of a named person, or to order, or to bearer would constitute such an
undertaking’.
479
480
Carté Société tuniso-européene d’assurances et de réassurances v Sudcargos 1996 Rev Scapel 40-42
481
482
Luddeke C & Johnson A (eds) The Hamburg Rules 2 ed (1995) 11.
65
under the new regime, the carrier is presumed at fault for any loss, damage or delay in
shipment unless he provides evidence to the contrary. 483
The Hague-Visby Rules provided a long list of exceptions to carrier liability, including
unconditional exoneration of carrier liability for loss or damage to the goods resulting from;
an act, neglect, or default of the master, mariner, pilot or the servants of the carrier in the
navigation or in the management of the ship.484 The provisions of Article 5(1) of the
Hamburg Rules erase these exceptions by imposing a single standard of liability. 485 The
liability scheme awarded under the Hague-Visby Rules has no parallel in the law regulating
other transport modes, more so, its contrary not only to the general legal concept that one
should be liable to pay compensation for loss or damage caused by his fault, or that of any
person under his employment, but also to the economic rationale that the party who is in
position to avoid a loss should be liable for its occurrence.486
In another connection, The Hamburg Rules improve on the provisions of the Hague-
Visby Rules, as they provide partial liability for delay, loss or damage to the goods in
circumstances of joint of causation: 487
“where fault or neglect on the part of the carrier, his servants or agents combines
with another cause to produce loss, damage or delay in delivery, the carrier is liable
only to the extent that the loss, damage or delay in delivery is attributable to such
fault or neglect, provided that the carrier proves the amount of the loss, damage or
delay in delivery not attributable thereto.” 488
Following the model of the Warsaw convention 1928, regulating air carriage, the
CMR regulating carriage by road and the CIM convention 1962 regulating carriage by rail,
the Hamburg Rules impose liability on the carrier for delayed delivery, unless the carrier can
prove that he took all reasonable measures to avoid the delay and its consequences. 489
The provisions of Article 5(1) of the Hamburg Rules are a significant advancement to
maritime law, as under the Hague regime, it is evident that there was uncertainty with
regards to the party on whom the burden of proof rested. This burden fluctuated between
the consignor and the carrier, and more often than not, leaving the consignor with the
burden of proving facts that were particularly within the knowledge of the carrier. 490
483
Hellawell R “Allocation of Risk between Cargo Owner and Carrier” 1979 (27) American Journal of
Comparative Law 357-36 357 http://www.jstor.org/stable/840039 (Accessed: 05/10/2010 07:02).
484
Article 4(2)(a) of the Hague Visby Rules.
485
Hellawell 1979 American Journal of Comparative Law 358 http://www.jstor.org/stable/840039.
486
Explanatory note by UNCITRAL Secretariat on the United Nations Convention on the Carriage of Goods by
Sea 1978(A/CN. 9/306) 17.
487
488
Luddeke & Johnson The Hamburg Rules 11.
489
490
Hellawell 1979 The American Journal of Comparative Law 361-362 http://www.jstor.org/stable/840039.
66
4.2.4 EXCEPTIONS TO CARRIER LIABILITY UNDER THE HAMBURG RULES
The Hamburg Rules drop all the exceptions awarded the carrier under the Hague-
Visby Rules including the heavily criticized navigational exception. 491 Under the Hague-Visby
Rules the carrier could exempt himself from liability for damage or loss that arose as a result
of a nautical fault, 492 but under the Hamburg Rules, liability shall attach to the carrier if he
cannot show that his agent, servant or himself took all reasonable measures required to
avoid the loss, damage or delay. 493 However, Article 5 of the Hamburg Rules provides
exceptions to the liability of the carrier in specific instances. 494 Per Article 5(5) where live
animals are carried:
“the carrier is not liable for loss, damage or delay in delivery resulting from any
special risk inherent is that kind of carriage. If the carrier proves that he has
complied with any special instructions given to him by the (consignor) respecting the
animals and that, in the circumstances of the case, the loss, damage or delay in
delivery could be attributed to such risks, it is presumed that the loss, damage or
delay in delivery was so caused, unless there is proof that all or part of the loss,
damage or delay in delivery resulted from default or neglect on the part of the
carrier, his servants or agents.” 495
The Hamburg Rules also provide an exemption to liability caused by fire. Under the
Hague Rules the carrier is exempted from liability for loss or damage caused by fire that
occurred as a result of his fault or negligence or that of his servants or agents. Similarly
favouring the carrier, Article 5(4) of the Hamburg Rules provides that the carrier shall be
liable for loss, damage or delay caused by fire if the claimant can prove either that the fire
arose from neglect on the part of the carrier, his servants or agents or the carrier, his
servants or agents were guilty of fault or neglect in taking all measures that could
reasonably be required to put out the fire and avoid or mitigate its consequences. 496 Be that
as it may, while under The Hague Rules, the claimant has to prove not only the fault or
negligence of the carrier’s servant, but also the actual negligence of the carrier, under the
provisions of the Hamburg Rules, it shall suffice that the claimant proves merely the fault or
negligence of the carrier’s servants.497
More so, the carrier shall be exempted from liability for loss or damage as a result of
a deviation to save a life or property at sea, 498 however, any deviation to save a life or
property must be a reasonable one in order to exempt the carrier from liability for any
491
492
493
494
495
496
Supra 13.
497
Ainuson K “THE HAMBURG RULES: DID IT INCREASE THE LIABILITY OF THE CARRIER?” LLM Thesis Athens
Georgia (2006) 1-60 45.
498
Article 5(6).
67
resulting loss or damage. 499 No specific definition is provided to the term ‘deviation’ under
the Hamburg Rules, however, Article 5(6) provides that, “the carrier is not liable, except in
general average; where loss, damage or delay in delivery resulted from measures to save life
or from reasonable measures to save property at sea.” 500
4.2.5 LIMITATION OF LIABILTY UNDER THE HAMBURG RULES
As afore mentioned, the Hamburg Rules draw a distinction between the carrier and
the actual carrier, so as to facilitate litigation and the settlement of claims. An interpretation
of Article 10 of the Hamburg Rules provides that the carrier is responsible for the part of the
carriage performed by the actual carrier, and they are both liable jointly and severally for
any loss or damage to the goods. 501 However, Article 10(5) states that the aggregate of the
amounts recoverable from the carrier, the actual carrier and their servants and agents shall
not exceed the limit of liability provided for under the convention.502
4.2.6 FINANCIAL LIMITATION
Like The Hague Visby Rules, the Hamburg Rules employ the SDR as its unit of account.503
The Hamburg Rules however increase the limit of liability awarded under the Hague-Visby
Rules from 666.6 SDR per package or unit and 2 SDR per kilogram to 835 SDR and 2.5 SDR
per kilogram. 504 The carrier and consignor may agree to increase this limit, but the limits
cannot be lowered. 505 Luddeke & Johnson have summarised the package limitation under
the Hamburg Rules as follows:
a. Where the bill of lading enumerates the contents of the container or pallet, each
package or other shipping unit is one shipping unit e.g. 1 container containing 106
packages = 106 shipping units.
b. Where the bill of lading does not enumerate the contents of the container or pallet,
the container is one shipping unit:
1 container containing general cargo=1 shipping unit
499
500
Zorlu R “The main features of the Hamburg rules and the Hague-Visby rules” 5 Google
http://www.akellawfirm.com/yayinlar/THE_MAIN_FEATURES_OF_THE_HAMBURG_RULES_AND_THE_HAG
UE-VISBY_RULES.pdf (Accessed: 13/08/2011).
501
502
503
504
Berlingieri F “A COMPARATIVE ANALYSIS OF THE HAGUE-VISBY RULES, THE HAMBURG RULES AND THE
ROTTERDAM RULES” 32 Google
http://www.uncitral.org/pdf/english/workinggroups/wg_3/Berlingieri_paper_comparing_RR_Hamb_HVR.p
df (Accessed: 13/08/2011).
505
Explanatory note by UNCITRAL Secretariat on the United Nations Convention on the Carriage of Goods by
Sea 1978 (Hamburg) (a/CN. 9/306) 22.
68
c. Where the bill of lading enumerates the contents of the container or pallet in
general terms:
1 container containing 7 items of general cargo =7 shipping units
d. Where the bill of lading enumerates the contents of the container as partly packages
and partly general cargo, each package is equated to a shipping unit, and the general
cargo is equated as a shipping unit to:
e.g. 1 container containing 7 packages and some general cargo=8 shipping units. 506
4.2.7 TIME LIMITATION
The Hamburg Rules expand the time within which action can be brought against the
carrier to two years, unlike the Hague-Visby Rules which provide a one year time bar within
which claims against the carrier must be brought. 507 The provision of a two year time bar by
the Hamburg Rules was to improve on the position of the consignor under the Hague/Visby
regime, which was deemed extremely difficult due to practical difficulties in identifying the
carrier against whom action must be brought within such a limited time frame. 508 Per Article
20(2), this limitation period runs from when the goods have been delivered, or parts of
them have been delivered, or where delivery has not been made, on the last day on which
they were supposed to have been delivered.509
4.3 WHY HAVE THE HAMBURG RULES FAILED?

The success of an international convention lies not only in its approval by the
regulating body, but also, in the incorporation of its provisions into the national laws of the
states concerned, uniform judicial interpretation thereof, and application of the rules. 510 It
will be right to say that the failure of the Hamburg Rules stems from the fact that very few
nations have ratified the Hamburg Rules, and more so, none of these nations constitutes a
major shipping nation that could pull its trading partners to ratify the convention. Thus, a
major part of the international community has not ratified the Hamburg Rules as a marine
cargo liability regime deserving of global implementation through a mandatory
instrument. 511 Furthermore, it is suggested that the limited support to the convention
provided by the developing countries, at whose behest it was created, is because the
506
507
508
509
510
Bonell MJ “International Uniform Law in Practice - Or Where the Real Trouble Begins”
American Journal of Comparative Law (38) 4 (1990) 865-888 866 http://www.jstor.org/stable/840615
(Accessed: 05/10/2010 07:48).
511
Makins 1991 MLAANZ 42.
69
ratification of the Hamburg Rules would not improve on their economic position on the
international scene.512
According to Tetley, given the circumstances under which the Hamburg Rules were
drafted, the convention was bound to be a failure, as the drafting of the convention was
done publicly by committee in a large hall. He states that; “Just as great poetry has never
been written by a committee so great laws are unlikely to be written by a committee even if
the parties have a common purpose.” 513
In another connection, it is opined that the changes brought to carrier liability by the
Hamburg Rules are too radical. A case in point is the abandonment of the catalogue of
exceptions awarded to the carrier under the Hague-Visby Rules. Opponents to the Hamburg
Rules contend that such radical changes to timeless maritime tradition would lead to
uncertainty and open the flood gates for litigation under the new regime.514 Legal reasoning
supports that when provisions of a law are unclear and unpredictable, the likelihood of
litigation resulting thereof increases, while the chances of such litigation being resolved
through settlement once a suit has been filed fall. The rationale behind this is that the odds
of compromise are greater when the claimant’s expected recovery and the defendant’s
predicted total expenditure are certain. The opposite will not favour settlement. 515
More so, opposition to the ratification of the Hamburg Rules contend that the
provisions of the Hague Visby Rules have been subjected to more than half a century of
judicial review and interpretation, thus ratifying a new regime that discards existing law will
be taking maritime judicial practice backwards. 516
On another level, opponents to the ratification of the Hamburg rules contend that
their new risk allocation scheme will lead to an increase in Protection and Indemnity Club
(P&I) insurance premiums, which the carriers will likely pass down to the consignor through
a subsequent increase in freight rate. In other words, the fact that the provisions of the
Hamburg Rules shift the burden of proof to the carrier, and eliminates all his exceptions to
liability under the Hague regime, is going to increase the carrier’s risks over the cargo, and
P&I clubs will hence increase their premiums since the risk they have to cover has increased.
On the other hand, the carriers’, in order to make up for this increase will have to increase
their freight charges thus throwing the expenses back to the consignor of the goods. In
512
513
Tetley QC “The Hamburg Rules - a commentary” 1979 (1) Lloyd's Maritime and Commercial Law
Quarterly 1-20 5 http://tetley.law.mcgill.ca/ (Accessed: 13/08/2011).
514
Werth D “The Hamburg Rules Revisited-A Look at U.S. Options” 1991 (22) Journal of Maritime Law and
Commerce 59-79 70 Sabinet (Accessed: 24/10/2011).
515
Sturley M “Changing Liability Rules and Marine Insurance: Conflicting Empirical Arguments About Hague,
Visby, and Hamburg in a Vacuum of Empirical Evidence” 1993 (24) Journal of Maritime Law and Commerce
119-149 134-135 Sabinet (Accessed: 24/10/2011).
516
Moore J “The Hamburg Rules” 1978 (10) Journal of Maritime Law and Commerce 1-11 2 UNISA Library
(Accessed: 23/10/2011).
70
brief, their argument is that the domestication of the Hamburg Rules will not only increase
insurance costs but the cost of the transaction as a whole. 517
Sturley, 518 though adopting a neutral approach to the validity of the insurance
argument, asserts that the argument has been in debate for decades and surfaces every
time change to a maritime regime has been suggested. The basis of this insurance argument
by the opponents of the Hamburg regime is that, the result of cargo insurer’s increased
possibilities of recourse from the liability insurers will cause not only a greater increase in
P&I premiums than there would be a decrease in cargo premiums, but also, increase freight
rates imposed on the consignor’s will be greater than the decrease in cargo insurance,
thereby leading to higher costs of transportation than what was obtained under the
Hague/Hague-Visby regimes. 519
In another connection, accent the Hamburg Rules was not favoured because it is
held that the provisions of the Hamburg Rules are merely a codification of established case
law under the Hague Visby Rules. 520 More so, the drafting of the Hamburg Rules is said to be
ambiguous and purposely drafted as such to make believe, the country representatives that
took part in its drafting, that their interpretations of its provisions are valid. The result of
this alleged ambiguity is criticized as going contrary to the raison d’etre of the convention,
which was to foster uniformity in the interpretation and application of the Hamburg
Rules. 521
Also, though the Hamburg Rules impose financial limitations similar to that provided
under the Hague Visby, in the light of inflation, the per package value of 2.5 SDR provided
under the Hamburg Rules is lower than the real value of the per package limitation adopted
by the Hague Visby in 1986, and the Hague in 1924. 522
In as much as the applicability of the Hamburg Rules to inward and outward carriage
is a compelling force favouring its position over the Hague/Hague-Visby regimes, the
application of the Hamburg Rules just by a hand full of contracting states makes the impact
of their provisions negligible on the international scene. 523
517
Werth 1991 Journal of Maritime Law and Commerce 71 Sabinet.
518
Sturley 1993 Journal of Maritime Law and Commerce 133 Sabinet.
519
Selvig 1981 Journal of Maritime Law and Commerce 315 Sabinet.
520
Tozaj D & Xhelilaj E “HAMBURG RULES V HAGUE VISBY RULES. AN ENGLISH PERSPECTIVE” 2010 (51)
Constanta Maritime University Annals 30-34 32 (Accessed: 10/11/2011 07:48)
521
Supra paragraph 3.3.
522
Tetley 1979 Lloyd's Maritime and Commercial Law Quarterly 9 http://tetley.law.mcgill.ca/.
523
71
4.4 CALL FOR A NEW CONVENTION
In the light of the confusion that characterised the maritime community, the USA, in
a bid to protect its carriers proposed an amendment to the Hague regime in the form of a
new US Carriage of Good by Sea Act 1998. This proposal presented before the US congress,
abolished the nautical fault and fire exemptions awarded to the carrier, extended the
carriers period of responsibility beyond the tackle-to-tackle, as well as extended the carriers
liability to the actual carrier. Also, it adopted amendments in the Visby Protocol, and
regulated multimodal carriage. Be that as it may, the USA foresaw that any national act
protecting their carriers may lead to further duress on their carriers on an international
platform. Hence the USA submitted their grievances with the status quo to the UNCITRAL
for a solution. 524
The result of intensive work undertook for almost Twelve years-firstly by the CMI for
four years, and then the Working Group three on Transport Law of the UNCITRAL for Eight
years, the United Nations Conventions on Contracts for the International Carriage of Goods
Wholly or Partly by Sea, (the Rotterdam Rules) was adopted by the UN general assembly in
New York USA, on December 11th, 2008, and was opened for signature in Rotterdam,
Netherlands on September 23, 2009.525
CHAPTER FIVE
THE ROTTERDAM RULES
5.1 DEVELOPMENTS INTRODUCED BY THE ROTTERDAM RULES
5.1.1 SCOPE OF APPLICATION
The Rotterdam Rules were designed to apply to any international carriage contract
to which a sea leg is included. Thus the complexity of multimodal transport, the fact that the
different transport modes regulated by different conventions will be involved, is considered
and resolved under the Rotterdam Rules. Commentators have stated that the new
convention was designed to be more than just a multimodal convention; one which
524
Karan 2011 Journal of Maritime Law & Commerce 447
525
72
emphasises the dominant position of the sea carriage leg in the performance of the entire
carriage, such that other stages of the carriage covered by other modes of transport would
be governed entirely by the Rotterdam Rules. Thus the application of the Rotterdam Rules
should have the effect of providing a single standard of protection to the consignor or
consignee under the contract of the carriage.526 Nevertheless, it should be borne in mind
that the Rotterdam Rules are mainly a ‘maritime plus’, rather than a convention on
multimodal carriage, since for it to bind a contract, there must not only be a sea leg, but an
international sea leg. 527
Aware that many countries apply regional conventions to inland carriage, in order to
avoid conflict, the Rotterdam Rules adopt a limited network system of liability – when
damage to cargo can be localised, the convention will recognise the authority of any
unimodal convention regulating that leg of the carriage. This shall place the carrier under
liability according to the provisions of the convention regulating that mode of transportation
as if the carrier has concluded a separate contract for that leg of the carriage. 528 This is in
conformity with Article 26 of the Rotterdam Rules which provides that:
“When loss of or damage to goods, or an event or circumstance causing a delay in

their delivery, occurs during the carrier's period of responsibility but solely before
their loading onto the ship or solely after their discharge from the ship, the
provisions of this Convention do not prevail over those provisions of another
international instrument that, at the time of such loss, damage or event or
circumstance causing delay:
a. Pursuant to the provisions of such international instrument would have

applied to all or any of the carrier's activities if the shipper had made a separate and
direct contract with the carrier in respect of the particular stage of carriage where
the loss of, or damage to goods, or an event or circumstance causing delay in their
delivery occurred;
b. Specifically provide for the carrier's liability, limitation of liability, or time for
suit; and
c. Cannot be departed from by contract either at all or to the detriment of the

consignor under that instrument.” 529
526
Pallarés 2011 Journal of Maritime Law & Commerce 456-457
527
Supra 459.
528
Supra 459.
529
Ling L“The Application of the Rotterdam Rules in international Multimodal Transportations: The Conflicts of
Liability Between the Rotterdam Rules and Other Relevant International Legal Regimes” 2011 (78) Journal
of Transportation Law, Logistics & Policy 207-220 217
http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=67046335&site=ehost-live (Accessed:
17/11/2011).
73
Be that as it may, where the point of damage cannot be localised, the Rotterdam
Rules shall apply as “fall back” rules. More so, the provision of this article shall apply only
where there could likely be the application of another convention of international character,
as the Rotterdam Rules takes precedence over national law. Article 26 is read in conjunction
with article 86 to reduce the risk of conflict in laws in the application of the Rotterdam
Rules, as article 86 provides that:
“nothing in this Convention affects the application of any of the following

international conventions in force at the time this Convention enters into force,
including any future amendment to such conventions, which regulate the liability of
the carrier for loss of or damage to the goods:
a. Any convention governing the carriage of goods by air to the extent that such
convention according to its provisions applies to any part of the contract of carriage;
b. Any convention governing the carriage of goods by road to the extent that
such convention according to its provisions applies to the carriage of goods that
remain loaded on a road cargo vehicle carried on board a ship;
c. Any convention governing the carriage of goods by rail to the extent that
such convention according to its provisions applies to carriage of goods by sea as a
supplement to the carriage by rail; or
d. Any convention governing the carriage of goods by inland waterways to the extent
that such convention according to its provisions applies to a carriage of goods
without trans-shipment both by inland waterways and sea.” 530
Also, while the Hague Visby Rules apply only to outward carriage, like the Hamburg
Rules, the provisions of the Rotterdam shall apply to both inbound and outbound carriage.
As provided by article 5.1:
“Subject to article 6, this convention applies to contracts of carriage in which the

place of receipt and place of delivery are in different states, and the port of loading
of a sea carriage and the port of discharge of the same sea carriage are in different
states, if, according to the contract of carriage, anyone of the following places is
located in a contracting state: the place of receipt; the port of loading; the place of
delivery; or the port of discharge.” 531
530
Ling L“The Application of the Rotterdam Rules in international Multimodal Transportations: The Conflicts of
Liability Between the Rotterdam Rules and Other Relevant International Legal Regimes” 2011 (78) Journal
of Transportation Law, Logistics & Policy 218-219
http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=67046335&site=ehost-live.
531
Supra 216.
74
5.1.2 DOCUMENTARY REQUIREMENTS
The use of electronic documents in electronic commerce has been a major

innovation in carriage by sea. While the out dated Hague and Hague Visby Rules do not have
provisions that accommodate such technological developments, and the Hamburg Rules
merely make mention of electronic writing and signature, the Rotterdam Rules meet up
with technological development as they contain functional provisions on electronic
transactions.532
Also, the Hague/Hague-Visby regimes adopted a documentary approach to contracts

of carriage. The provisions of the convention would bind the parties to the contract only
upon the issue of a bill of lading. This bill of lading has the effect of extending the protection
awarded to the parties to the contract to a third party holder of the bill of lading. The
Hamburg Rules on the other hand adopt a contractual approach, hence the terms of the
convention will regulate the relationship of the parties should they enter a contract of
carriage. Thus while under the Hague Visby Rules and Hamburg Rules, the carrier is
expected to issue a bill of lading to the consignor as evidence of their contract of carriage
for the convention to apply to their contract, the Rotterdam Rules do not require the
issuance of any such document. The issue of a bill of lading shall not be a precondition for
the provisions of the Rotterdam Rules to apply to the contract, if the carrier and the
consignor agree to the transaction otherwise than with the use of documents; or if the
custom of the area does not require the issuances of any document.533 The Rotterdam Rules
introduce a hybrid approach, but the application of the convention must be borne in
contract. Per Article 1 of the Rotterdam Rules, a contract of carriage is “one in which a
carrier, against the payment of freight, undertakes to carry goods from one place to
another. The contract shall provide for carriage by sea and may provide for carriage by other
modes in addition to the sea carriage.” 534
5.1.3 LIABILITY OF THE CARRIER UNDER THE ROTTERDAM RULES
Just like under the Hamburg Rules, the Rotterdam Rules carrier shall be liable for
loss, damage or delay caused by his fault, or that of his servant or agent. But while under
the Hague Visby Rules and Hamburg Rules there is no reference to burden of proof lying on
532
533
Berlingieri F “A COMPARATIVE ANALYSIS OF THE HAGUE-VISBY RULES, THE HAMBURG RULES AND THE
ROTTERDAM RULES” 25 Google
df (Accessed: 13/08/2011).
534
Note 10 in Mukherjee & Bal 2009 Journal of Maritime Law & Commerce 582
75
the claimant, Article 17(1) of the Rotterdam Rules provide that liability shall lie on the
carrier, should the claimant establish that the loss, damage or delay occurred during the
carrier’s period of responsibility.535
The Rotterdam Rules also extend the period of responsibility for the carriage of
goods to ‘door to door’, rather than the ‘tackle to tackle’ under the Hague and Hague Visby
Rules, and ‘port to port’ under the Hamburg Rules. This is a major evolution in the law on
carriage. Modern day practice enables the parties to extend their contract of carriage by sea
inland, but such an agreement can be enforced only under the contract, whereas, under the
Rotterdam Rules, the provisions have the force of law. 536 To this effect, Article 12(1) of the
Rotterdam Rules provides that:
“the period of responsibility of the carrier for the goods under this convention begins
when the carrier or performing party receives goods for carriage and ends when the
goods are delivered.” 537
Thus, the Rotterdam Rules meet the needs of modern day transport practice which
requires door to door sales, hence door to door carriage. 538
The Rotterdam Rules also impose an obligation on the carrier to ensure that the ship
is seaworthy not only at the start of the voyage as under the previous regimes, but the
carrier must ensure that the ship is seaworthy throughout the entire voyage. 539 Whilst the
Hague and Hague Visby regimes and English common law impose a duty on the carrier to
render the vessel seaworthy before and at the beginning of the voyage, the Rotterdam
Rules, 540 supplement to the duties of the carrier as imposed under the earlier regimes, and
imposes duties on the carrier that must be performed during the sea voyage. 541
Since the development of steam powered vessels, the use of containers for carriage
of goods has been a major revolution in the entire transport sector. Containers have been
535
Berlingieri 8 Google
df.
536
537
Ling 2011 Journal of Transportation Law, Logistics & Policy 216
http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=67046335&site=ehost-live .
538
539
Khalid N & Suppiah R “The Rotterdam Rules: Catalyst for trade or cumbersome convention?” 2010 (37)
Maritime Policy & Management 447-450 449
17/11/2011).
540
Article 14.
541
Aladwani T “The Supply of Containers and "Seaworthiness"-The Rotterdam Rules Perspective” 2011 (42)
Journal of Maritime Law & Commerce 185-209 185
17/12/2011).
76
employed for carriage of goods since 1950. 542 The Rotterdam Rules, unlike the previous
regimes that require that the carrier render his vessel seaworthy before and at the start of
the voyage, extends this duty to the use of containers, as it imposes an obligation on the
carrier to provide seaworthy containers, which is more consistent with modern day practice
of carriage of goods. The container is vital in modern day carriage. From the view point of
the carrier, the container is an extension of the vessel, as it protects the cargo on its own,
and from the consignor’s position, it serves as a package securing his cargo onboard the
vessel. 543 Where it is established that the container is part of the vessel’s superstructure, or
equipment of the vessel, liability for loss, damage or delay caused by the unseaworthiness
of the container may make the carrier liable for such loss, delay or damage to the cargo.544
Hence the carrier must ensure that not only the vessel is seaworthy, but the containers are
seaworthy and cargo worthy as well. 545 Defective containers endanger not only the cargo
they contain, but are hazardous to the vessel and crew as well. 546
In a nutshell, the Rotterdam Rules improve on the previous regimes by providing

guidelines for the use of containers in the performance of carriage, and by virtue of Article
14(c), imposing an obligation that such containers be supplied by the carrier, and that they
be as seaworthy as any other hold or part of the vessel throughout the voyage. The
extension of the carrier’s duty of providing a seaworthy vessel to the carrier’s use of
containers justifies Sturley’s position that one of the major aims of the Rotterdam Rules is to
establish practical measures to reconcile transport law, and fast developing modern day
transport practices in order to solve maritime problems. 547
More so, the Rotterdam Rules address the problem of classification societies and
their unlimited liability toward third parties. The argument on classification societies has
been a perpetual one. 548 Under the Hague and Hague Visby regimes, rather than obtain a
limited compensation that conforms to the provisions of the conventions, the cargo
claimant could claim full compensation from a third party who is not considered an agent or
servant of the carrier, but caused loss or damage to his goods. This position was eventually
changed with the introduction of the Himalaya clause in transport agreements, which has
the effect of extending the defenses and limitation of liability cover awarded to the carrier
under the Hague/Hague-Visby regimes, to third parties and persons acting in the course of
the employment by the carrier. This pushed cargo claimants to seek to recover full
compensation from independent contractors not privy to a Himalaya clause. Classification
542
Supra 186.
543
Supra 186.
544
Supra 188 .
545
.Supra 187.
546
Supra 189.
547
Note 66 in Aladwani 2011 Journal of Maritime Law & Commerce 197
548
Bäckdén P “Will Himalaya Bring Class Down from Mount Olympus? - Impact of the Rotterdam Rules” 2011
(42) Journal of Maritime Law & Commerce 115-123 115
17/12/2011).
77
societies comprise such a body of independent contractors that have been targeted by
cargo owners for claims in tort. The rationale for the action of the cargo claimant is that
when the classification societies perform their duties negligently, and as a result, a cargo
interest suffers loss or damage to his cargo, it would only be fair that such a classification
society indemnify the claimant.549
Hitherto the Rotterdam Rules, these classification societies have enjoyed a form of
immunity from liability for loss or damage caused to third parties. 550 In the UK, attempts to
bring action against for damages by third parties had been deemed inadmissible by the
courts as seen in Nicholas H. 551 The House of Lords held that it would be unjust and
unreasonable to impose liability on classification societies towards third parties. Worthy of
note here is the fact that under English Tort law, for an action to be brought against a
defendant three major criterion must be satisfied; foreseeability of damages, proximity
between parties and reasonableness. The rationale for the decision of the House of Lords
was that allowing such liability would upset long term established business practices, and
that it would be unfair since these classification societies are not covered by the limitation
of liability awarded the carrier under the Hague regimes, nor are the classification societies
given an opportunity to limit their liability under contract. 552
The liability regime established by the Rotterdam Rules extends the defenses and
limitations of liability awarded to the carrier to any ‘maritime performing party’. 553 Per
Article 1 of the Rotterdam Rules, such a performing party is considered as such:
“to the extent that it performs or undertakes to perform any of the carrier’s
obligations during the period between the arrival of the goods at the port of loading
of a ship and their departure from the port of discharge of a ship. An inland carrier is
a maritime performing party only if it performs or undertakes to perform its services
exclusively within a port area.”
Thus the immunity hitherto awarded to the classification societies is broken as the
Rotterdam Rules have extended the protection awarded to the carrier to such classification
societies. 554
549
Supra 116.
550
Supra 123.
551
Marc Rich & Co AG v Bishop Rock Marine Co Ltd [1995] Lloyd’s Law Rep 2. 299.
552
Bäckdén 2011 Journal of Maritime Law & Commerce 118
553
Khalid & Suppiah 2010 Maritime Policy & Management supra
554
Bäckdén 2011 Journal of Maritime Law & Commerce 120
78
5.1.4 EXCEPTIONS FROM LIABILITY UNDER THE ROTTERDAM RULES
The Rotterdam Rules put an end to the carrier’s nautical fault exemption for damage
of loss of the cargo that arises from an error in navigation.555 More so, though controversial,
the Rotterdam Rules increase the contracting parties’ freedom of contract. This freedom is
extended to volume contracts. 556 Such volume contracts shall be subjected to the
Rotterdam Rules unless the contracting parties agree to contract out of the cover of the
convention, 557 in conformity with Article 80(2) of the Rotterdam Rules. During the
negotiations for the adoption of the Rotterdam Rules the USA delegation insisted on this
provision as compromise for their acceptance of the higher limits of compensation provided
under the new convention. The rationale for this according to Carlson 558 was that, it is
necessary to “give flexibility to parties for a convention to last 50 years. There are going to
be developments in how people do business that we can't foresee.” 559
5.1.5 LIMITATION OF LIABILITY UNDER THE ROTTERDAM RULES
The Rotterdam Rules provide for a two year time bar within which action against the
carrier in relation to the contract may be brought, rather than the one year time bar
provided under the Hague regime.560
Also, while financial compensation under the Hague Visby Rules, that is limited to
666.67 SDR per package or unit, and 2 SDR per kilogram are increased to 835 SDR and 2.5
SDR respectively under the Hamburg Rules, the Rotterdam Rules increase these limits to 875
SDR and 3 SDR. This increase by the Rotterdam Rules in contrast to the Hague Visby Rules
reflect a 31.25% increase per package limit, and a 50% increase for the per Kilogram
limit. 561
555
Khalid & Suppiah 2010 Maritime Policy & Management 449
556
Article 1(2) defines ‘volume contracts’ as, “a contract of carriage that provides for the carriage of a specific
quantity of goods with a service of shipments during an agreed period of time. The specification of the
quantity may include a minimum, a maximum or a certain range.”
557
558
Mary Helen Carlson, the U.S. lead negotiator at UNCITRAL.
559
Edmonson RG “New Rules of the Sea” 2009 (10) Journal of Commerce 10-14
17/12/2011).
560
Khalid & Suppiah 2010 Maritime Policy & Management 449
http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=52063205&site=ehost-live..
561
Berlingeri 32 Google
df.
79
CHAPTER SIX
CONCLUSION
6.1 RECOMMENDATION
This dissertation establishes a map on the evolution of international conventions
that were developed over the years to regulate maritime carriage. A major problem of
maritime practice has always been the scope of the carrier’s liability with regards to the
cargo in his care. At first the law imposed a strict liability on the carrier for loss or damage to
goods with the only exemptions to this liability being loss or damage resulting from an Act
of God, Inherent vice, Public enemies, or fault of the consignor. But as the carrier’s position
was reinforced at the turn of the 19th century, the carrier introduced more and more
exceptions into the bill of lading, and it didn’t take long before the carrier could exempt
himself from almost every form of liability including liability for loss or damage resulting
from his own negligence. 562 Consignors felt that with developments in the shipping industry
as well as new advanced means of communication available, the exceptions awarded to the
carrier under the contract of carriage must be limited so as to provide certainty and equality
in the allocation of risks between the carrier and the consignor. The first rules regulating sea
carriage that were drafted by the merchants were deemed satisfactory at the time given the
nature of the ships, made of wood, and lack of means by the carrier to control operations on
his vessels from a distance while the ship was at sea. These early rules that were
incorporated into the bill of lading, which served as evidence of the contract of carriage,
were backed by the common law courts. Recommendations and a lot of pressure from the
562
Hellawell 1979 American Journal of Comparative Law 357 http://www.jstor.org/stable/840039.
80
consignors within their states, led to government intervention in the business of carriage,
and the passing of local legislation to regulate the relationship between the parties. This was
the beginning of a bigger problem, as this led to a great disparity in the rules regulating
international carriage by sea, as the rules changed as the ships moved from one country to
another.
Be that as it may, early international intervention to remedy the situation led to the
adoption of the Hague Rules in 1924 (International Convention for the Unification of Certain
Rules of Law Relating to Bills of Lading), and the adoption of the Visby Protocol in 1968
(Protocol to Amend the International Convention for the Unification of Certain Rules of Law
Relating to Bills of Lading), the Hague /Visby Rules. The problem however persisted as these
two international conventions were modelled on the bill of lading, which provided much
advantage to the carriers, to the dissatisfaction of the consignors. To this effect the
consignors, mainly from developing countries called on the international community, 563 to
redress their situation and draft a new convention that will consider their views and position
with regard to carriage by sea. It is in this light that the Hamburg Rules (United Nations
Convention on the Carriage of Goods by Sea), were adopted in 1978 to replace the
Hague/Visby regime.
From an overview of the evolution of laws regulating carriage by sea, it is obvious

that one of the primary goals of the international maritime community has been to establish
and promote uniformity and clarity in the application of rules governing sea transport.
Although economic and political agendas were a major force behind the working groups
that took part in the adopting of the above discussed international conventions, as well as
judgements of the courts, the idea has always been to create a platform wherein the
business of carriage by sea could be conducted safely, equitably and to the satisfaction of all
the parties involved.
The Hamburg Rules, like any convention before it was subject of extensive and
intensive study, and was the culminating event from the revision of the issues that plagued
the relationships of parties to contracts of carriage by sea under the Hague Visby Rules. A
number of arguments have been advanced as to why the Hamburg Rules should be
abandoned. As earlier seen, the insurance argument is one which has been most recurrent
over the years every time change in regime was suggested. However, the provisions of the
Hamburg Rules establish not only efficiency, but also fairness in the business of carriage of
goods by sea. It is established that the law must determine a scheme of allocation of risks
for loss when such loss arise between parties to a transaction. The best theories to this
effect provide that such division in the allocation of risks require that a big enough burden
be placed on the carrier in order to encourage him to exercise utmost care in the handling
of goods in his possession, and once this threshold level is attained, the remaining risks must
563
A draft Convention was completed by UNCITRAL in 1976 and submitted to a diplomatic conference at
Hamburg.
81
be passed to the [consignor] or cargo insurer.564 In this light, by eliminating the defence
awarded to carriers under the Hague regime for negligence in navigation and management
of the ship, the Hamburg Rules foster not only fairness in the transaction but also encourage
efficiency. It is only fair that greater liability for loss or damage be imposed on the party
(carrier) in the best position to prevent its occurrence. Hence loss resulting from negligent
navigation or management of the ship is likely to reduce considerably should more nations
choose to ratify the Hamburg Rules. 565
A common trend amongst all the conventions adopted before the Rotterdam Rules is
their applicability only to contracts of carriage by sea. It is established that the modern day
maritime contract is multimodal. The use of containers for carriage has greatly boosted the
demand for multimodal contracts for door to door carriage, which has proven efficient for
international traders and carriers. 566
From the multiple conventions that were developed to regulate maritime carriage, it
is understandable why the legal atmosphere surrounding carriage by sea has been described
as a legal tower of Babel. 567 Most of the world’s shipping operations are regulated by the
Hague Visby Rules, but these are not the only rules regulating sea carriage. More so,
another significant portion of carriage operations are regulated by the out-dated Hague
Rules and only a hand full of other trading countries have adopted the Hamburg Rules. As if
this wasn’t confusing enough, some countries have adopted a hybrid regime; – China for
instance, which is considered a world heavy weight in the transport industry, has adopted a
maritime regime which incorporates not only the Hague Visby Rules and Hamburg Rules,
but also provisions peculiar to Chinese law. 568 Other nations have also adopted hybrid
regimes as they incorporate major elements of the Hamburg Rules into their ratified
versions of the Hague Visby Rules, 569 which has led to a flood in litigation, as these hybrid
regimes are applied to both inward and outward carriage causing a conflict of laws. 570
It is in a bid to repair the conflicts caused by the hitherto maritime conventions that
the Rotterdam Rules incorporate provisions of both the Hamburg and Hague Visby Rules in
order to promote harmonization, and to update and modernize the present practices to
meet today’s realities of an increase in multimodal carriage, the growing influence of
transport intermediaries, and the ever increasing technological innovations. 571
564
Sturley 1993 Journal of Maritime Law and Commerce 127-128 Sabinet.
565
Supra 129-130.
566
Ling 2011 Journal of Transportation Law, Logistics & Policy 207
567
568
Supra 457.
569
Note 5 in Mukherjee & Bal 2009 Journal of Maritime Law & Commerce 580
570
Supra 580.
571
Pallarés 2011 Journal of Maritime Law & Commerce 457-458
82
On the 23rd of September 2009 when the Rotterdam Rules were opened for
signature, 16 countries signed them on that same day. Not only is this the most impressive
turn out obtained on a convention developed by UNCITRAL on the day it opened for
signature, but the countries that signed the Rotterdam Rules on this day included the
world’s heavy weights in the shipping industry; the USA, France, Greece, Norway, Denmark
and the Netherlands, as well as prominent developing nations such as, Nigeria, Senegal,
Congo, Gabon, Ghana, Guinea, and Togo. All the countries that signed this convention on
the opening day represent over 25% of the world trade volume at that time, according to
the United Nations 2008 International Merchandise Trade Statistics Yearbook, unlike the
Hamburg Rules whose total number of signatories represent just approximately 5% of the
world trade volume.572 Barely a month following the opening to signature of the Rotterdam
Rules five more countries signed the convention, these include; Armenia, Cameroon,
Madagascar, Niger and Mali, while other major shipping nations such as Britain and Belgian
pledge their support to the promotion of the new convention whilst yet considering its
adoption. A close look at the nations that have signed the Rotterdam Rules so far would
show that, it has gained ready support from carrier and consignor nations, and also gained
an equilibrium that was lacking under the previous maritime regimes, and hence more likely
to succeed, unlike its predecessor. As stated by the Belgian representative at the signing
ceremony in Rotterdam:
“International trade will of course be the first beneficiary. But worldwide

harmonized rules are also an essential factor in the development of a sustainable
mobility and transport, because worldwide harmonized rules will enable a better
integration of sea transport in the multimodal transport, which is essential to reach
that objective of sustainable mobility and transport” 573
Incentive to ratify the Rotterdam Rules in the USA is tremendous, not only due to the
very active role played by the USA delegation in the negotiations for this new convention,
but also, delegates from the American Bar Association highly recommend the ratification of
the new convention as they state that the Rotterdam Rules:
“set forth, with greater clarity, the rights and responsibilities of the interested
parties” and provide ‘an efficient and predictable uniform legal regime for maritime
carriage, as well as maritime carriage involving inland legs’.” 574
Supporting the view of the International Chamber of Shipping, it is very much likely
that a failure to ratify the Rotterdam Rules will maintain the status quo on the international
scene. There is bound to be development to meet the changes in maritime activity. Such
changes may entail individual states resorting to enacting national legislature to protect
572
Kate L “A Win-Win Proposition” 2009 maritime gateway 13 Google (Accessed: 17/11/2011).
573
Kate 2009 maritime gateway 13.
574
“ABA Delegates Approve "Rotterdam Rules" Resolution” 2010 (65) Dispute Resolution Journal 21
17/11/2011).
83
their interests. In sum, failure to ratify the Rotterdam Rules will only incite regionalism,
which in turn will increase uncertainty and conflict due to the lack of uniformity between
legal regimes, to the detriment of international trade. 575
The Rotterdam Rules in contrast to the earlier regimes regulating maritime carriage
allows more flexibility to the parties in their dealings by enumerating circumstances wherein
the parties may derogate from the mandatory provisions of the convention,576 whereas the
Hague regimes provide no such derogation to their terms, and the Hamburg Rules only
make mention of derogation in the light of carriage of goods in a series of carriage
transactions.577
Other than the liability relationship between the carrier and the consignor, another
important dimension of the relationship between the parties to the contract of carriage that
cannot be ignored is their trade relationship, which impacts international trade as a
whole. 578 In developing provisions to regulate the liability of parties under contracts of
carriage, no international convention, nor national regime, hitherto the Rotterdam Rules
has considered the impact of the trade relationship between the parties on their economic
efficiency. The provisions of the Rotterdam Rules provide such flexibility in their application,
especially in the light of volume contracts that enhance economic efficiency and
international trade in general. 579 In the words of Edmonson, the Rotterdam Rules ‘are the
best agreement everyone is likely to get, and a quantum leap ahead of earlier liability
treaties.’ 580
The author strongly supports that given the new scope of liability and application
introduced by the Rotterdam Rules, coupled with the diverse and significant support it has
obtained from major shipping nations not only from the developed countries, but also
developing nations, the Rotterdam Rules are the most effective tool yet, regulating carrier
liability. Thus, the author suggests that it be ratified by more, if not all shipping nations. As
Sturley581 advised in the USA, the ratification of the Rotterdam Rules will not only promote
greater certainty, predictability and uniformity within the USA but between the USA and
other countries.
575
The Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea (The
“Rotterdam Rules”) A Position Paper by the International Chamber of Shipping 2009
http://www.uncitral.org/pdf/english/texts/transport/rotterdam_rules/ICS_PositionPaper.pdf 1-5
(Accessed: 17/11/2011).
576
Article 80
577
Mukherjee & Bal 2009 Journal of Maritime Law & Commerce 599
578
Supra 582.
579
Supra 606.
580
Edmonson 2009 Journal of Commerce 10-14 10
581
Sturley MF “Modernizing and Reforming U.S. Maritime Law: The Impact of the Rotterdam Rules in the
United States” 2009 (44) Texas International Law Journal 427-455 454
17/11/2011).
84
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89
INTERNATIONAL CONVENTIONS
Convention for the Unification of Certain Rules Relating to International Carriage by Air,
Signed at Warsaw on 12 October 1929 (Warsaw Convention)
Convention on the Contract for the International Carriage of Goods by Road (CMR) -
(Geneva, 19 May 1956)
International Convention for the Unification of Certain Rules of Law relating to Bills of Lading -The
Hague Rules 1924
The Hague-Visby Rules-The Hague Rules as Amended by the Brussels Protocol 1968.
Uniform Rules Concerning the Contract for International Carriage of Goods by Rail (CIM)
United Nations Convention on Contracts for the International Carriage of GoodsWholly or

Partly by Sea –The Rotterdam Rules.
United Nations Convention on the Carriage of Goods by Sea (The Hamburg Rules) Hamburg,
30 March 1978.
THESIS
Ainuson, K “THE HAMBURG RULES: DID IT INCREASE THE LIABILITY OF THE CARRIER?” LLM
Thesis Athens Georgia (2006) 1-60.
LEGISLATION
SEA TRANSPORT DOCUMENTS ACT -Act 65 of 2000. Published in Government Gazette Vol.426 No.
21884 13 December 2000. http://www.info.gov.za/view/DownloadFileAction?id=68234
UK Merchant shipping act 1995
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Anglo-Saxon Adamastos Shipping Co [1957] 1 Lloyd’s Rep 79.
Arnold Karberg & Co v Blythe, Green Jourdain& Co [1915] 2KB 379 388.
Asfar v Blundell [1896] 1 QB 123.
90
Australasian United Steam Navigation Co Ltd v Hiskens (1914) 18 CLR 646 671.
Barclays Bank Ltd v Commissioners of Customs and Excise [1963] 1 Lloyd’s Rep. 81.
Baumwoll v Gilchrist [1983] 1 QB253.
Bourne v Gatliffe (1841) 133 ER 1298.
Bradley v Waterhouse (1828) 3 COP 318.
Burton & Co v English (1883) 12 QBD 218.
Canada Rice Mills Ltd v Marine and General Insurance Co. Ltd [1941] AC 55.
CompagnieSénéglaised’Assurances et de Réassureance CSA and 27 Other Companies v

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CompaniaNaviera General SA v Keramental ltd
Cowasjee v Thompson (1845) 5 Moore PC 165.
Cremer v General Carriers SA [1973] 2 Lloyd’s Rep 366 284.
Dakin v Oxley (1864) 15 CBNS 646.
Davis v Lockstone (1921) AD 153.
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91
Goose Millerd Ltd v Canadian Government Merchant Maine Ltd [1929] AC 223.
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Hamilton Fraser and co. v Pandorfand Co [1887] 12 AC 518.
Harris & Son Ltd v China Mutual Steam Navigation Co Ltd [1959] 2 Lloyds Rep 500 501
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King and Ors v Parker(1876) 34 LT 887.
Kirchner v Venus (1859) 12 Moore PC 361 390.
Kish v Taylor [1912] App Cas (HL).
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Leduc v Ward [1888] 20 QBD 457
Leesh River Tea Co v British India Steam Navigation [1966] 2 Lloyd rep 193.
Lennard’s Carrying Co Ltd v Asiatic Petroleum co Ltd [1915] AC 705.
Leonis v Rank (No.2) (1908) 13 Com Cas 295.
Levinson v Patent Steam Cleaning [1978] QB 69.
Levy v Calf and others (1857) W I 4.
Lickbarrow v Masin [1794] 5 TR 683.
Marc Rich & Co AG v Bishop Rock Marine Co Ltd [1995] Lloyd’s Law Rep 2. 299
Maxine Footwear Co Ltd v Canadian Merchant Marine [1959] 2 Lloyd’s Rep 105.
MB Pyramid Sound NV v Briesse-Schiffahrts GmbH (The Sina) (The Ines) [1995] 2 Lloyd’s Rep.
144.
92
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Mitsubishi Corp v Eastwind Transport Ltd and Ors [2004] EWHC 2924 (comm).
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Moore v Lunn (1923) 38 TLR 649.
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NavieraMogor SA v SocieteMetallurgique de Normandie: The Nogar Marin [1988] 1 Lloyd’s

Rep 412 420 CA.
Nesbitt v Lushington (1792) 4 TR 783.
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95

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CARRIAGE OF GOODS BY SEA – FROM HAGUE TO

ROTTERDAM: SAFER WATERS

Submitted in fulfilment of the requirements for the

In the Faculty of Law at the

NELSON MANDELA METROPOLITAN UNIVERSITY

METUGE DENNING NGOMELE

In order to avoid the extensive nationalisation of carriage laws, the international

CHAPTER ONE: INTRODUCTION ............................................................................................ 1

CHAPTER TWO: CARRIERS’ LIABILITY UNDER ENGLISH COMMON LAW ............................ 23

CHAPTER THREE: CARRIERS’ LIABILITY UNDER THE HAGUE/HAGUE VISBY

3.1 INTRODUCTION ............................................................................................................ 40

CHAPTER FIVE: THE ROTTERDAM RULES ............................................................................ 76

In the 19th century, development of efficient steam power caused shipping

The Hague-Visby Rules continue to accommodate the excessive exclusionary terms

1.2 DEFINITION OF THE PROBLEM

1.3 RESEARCH QUESTION

1.4 AIM AND OBJECTIVES

1.6.1 NATURE OF THE CONTRACT OF SALE

1.6.2 C.I.F CONTRACTS

Despite the numerous documents that comprise an international business

1.6.3 F.O.B CONTRACTS

In another connection, unlike C.I.F. contracts there is no standard definition F.O.B. 54

1.6.4 TYPES OF CARRIAGE CONTRACTS

There are three types of charter parties;

1.6.5 WHY INTERNATIONAL REGULATION?

a. The bill of lading is issued in a contracting state; or

1.7 THE BILL OF LADING AND PERFORMANCE OF THE CONTRACT OF

“a bill of lading is a document of dignity, and courts should do everything in their

1.7.1 BILL OF LADING AS RECEIPTS

1.7.2 THE BILL OF LADING AS EVIDENCE OF THE CONTRACT OF CARRIAGE

1.7.3 THE BILL OF LADING AS DOCUMENT OF TITLE

An important feature of the bill of lading is its transferability as a document of title

1.7.4 PERFORMANCE OF THE CONTRACT OF CARRIAGE

The mate’s receipt serves two purposes:

“…there is a further degree of responsibility (other than negligence or wilfulness) by

2.2 DUTIES OF THE CARRIER AT COMMON LAW

2.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP

Be that as it may, should the vessel go missing immediately after the

2.2.2 DUTY TO PROCEED WITH DUE DISPATCH

2.2.3 DUTY NOT TO DEVIATE

“… deviation for the purpose of communicating with a ship in distress is allowable,

2.2.4 DUTY TO TAKE REASONABLE CARE OF THE GOODS

2.2.5 DUTY TO DELIVER GOODS TO A NAMED OR IDENTIFIABLE PERSON

2.3 COMMON LAW EXCEPTIONS FROM LIABILITY

2.3.1 ACTS OF GOD

2.3.3 INHERENT VICE

2.3.4 FAULT OR FRAUD OF CONSIGNOR

2.4.1 PERILS OF THE SEA

“Where there is an accidental incursion of seawater into a vessel at a part of the

2.4.2 ARREST OR RESTRAINT OF PRINCES

It is common that carriers include a clause to exempt themselves from loss or

However, in Maxine Footwear Co Ltd v Canadian Merchant Marine, 263 it was

2.4.5 NEGLIGENCE AND NAVIGATIONAL ERRORS

“… it seems to me that in construing this document, which is a contract of carriage

“Common law relations based on reasonableness and fairness were in practice

a) The bill of lading is issued in a contracting state, or

In another connection, although the relationship between a consignor and a carrier

In as much as these international conventions improve on the state of maritime