Liability of the Sea Carrier in the International Carriage of Goods by Sea

Abstract

The subject matter of this thesis is the liability of the sea carrier in the international carriage of goods by sea. Chapter One: discuses the nature of liability of the sea carrier under the Hague/Visby Rules and Hamburg Rules. The Hague/Visby Rules define the term “Carrier” as including the owner or the charterer who enters into contract of carriage with the shipper, while Hamburg Rules widen the definition to include any person by whom or on whose name contract of carriage of goods by sea has been concluded with a shipper. The Hague/Visby scheme of liability is built on specific obligations by which the carrier is bound, i.e. the obligation to issue a bill of lading, obligation to exercise due diligence, to provide a seaworthy ship and the obligation of care of cargo. The failure of the carrier in the fulfillment of the obligations will expose him to cargo claims by shippers or cargo owners in cases of loss or damage to cargo. He will be held as liable for damages unless he proves that he is exempted form liability by virtue of one of the seventeen exceptions provided for in Article IV. The most significant of them are: fire; perils of the sea; force majeure, nautical fault; acts and omissions of the shipper. Hamburg Rules introduce a relatively simple scheme of liability based on the “presumed fault” by the carrier his agents or servants. Thus in cases of loss or damage to cargo the carrier is held to be liable unless he proves that he, his servants and agents were not at fault. Chapter Two: considers the scope of liability under the Hague/Visby Rules. They cover bills of lading which are issued in contracting state or which incorporate the Rules by paramount clause. They cover the international outward carriage only. While under Hamburg Rules it is immaterial whether or not a bill of lading has been issued. The Rules cover contract of carriage concluded in a contracting state or if the port of loading or port of discharge is in a contracting state. Moreover if the optional port of discharge is in a contracting state. Similarly, it can be incorporated by paramount clause in the bill of lading. Hamburg Rules cover the inward and outward international carriage. The period of application under the Hague/Visby Rules is limited from the time of loading till the time of discharge, i.e. “tackle to tackle” period, while Hamburg Rules cover the entire voyage until the goods are handed over or put in disposal of the cargo owner. The Hague/Visby Rules do not provide for liability in cases of delay in delivery. They exclude the live animals and deck cargo from the definition of goods. While Hamburg Rules provide for liability of carrier in cases of delay in delivery. They bring all cargoes under their umbrella. Thus they provide for liability of the carrier in cases of live animals and deck cargo. Both conventions provide for liability for shipment of dangerous cargoes. The well known doctrine of deviation under the common law is still in use under the Hague/Visby Rules. It operates to hold the carrier as in a fundamental breach of contract unless he proves that he deviates to save life or property at sea. Hamburg Rules do not recognize the doctrine of deviation. Chapter Three: considers the limits of liability and limits of actions. The same system of calculating the limit of liability is valid under both conventions, i.e. the dual system of per package, per kilo. The former is for goods with high value compared to their weight, while the latter is suitable for bulk cargoes. Although the Hague/Visby Rules introduce a provision for calculating limit of liability in containerized goods, i.e. according to the items enumerated on the bill of lading, the position is still ambiguous. The unit of account is Poincare franc which is replaced by the additional Protocol ١٩٧٩ by the Special Drawing Right (SDR) and so forth under Hamburg Rules. The limits should be broken when the carrier is in default of negligence, recklessness or intentional acts. Moreover, the carrier cannot be benefited by the limits of liability under the Hague/Visby Rules if he is in default i.e. in cases of fundamental breach of contract such as deviations or stowage on deck without shippers consent.