The Law

• Recent clarification

  • “Giannis nk” (1994) 2 Ll rep 171

  • “Orjula” (1995) 1 Ll rep 654

  • “Berge Sisar” (2001) HL 1 Ll rep 663

  • “Baltic Flame” (2001) CA 2 Ll rep 203.

• Potential defendants

• Claim against shippers

• Claim against lawful Bill of Lading holder

• Claim against Charterers

• Basis of claim – dangerous goods

  • Common law implied term

  • Hague/Hague-Visby rules (art. iv, r. 6)

  • House of Lords definition of dangerous goods

  • Cargo to be of an unusual character

  • Strict liability

• Documentary collection of evidence

• Evidence of good condition of ship's tanks prior to incident

• Contemporaneous evidence of damage

• Best guess of mechanism of corrosion

• Fully documented claim for repair and loss of use of vessel.

• For a pro forma list of documentary evidence required click here

• The liability of cargo interests for damage to ships' tanks and holds has recently undergone clarification in four important cases.  The latter two were cases that were handled by Russell Ridley. The effect of these decisions is to simplify the shipowners’ rights to sue for both physical damage repair costs and loss of hire.

A claim may be brought either against:

• The shippers as an original party to the bill of lading contract,

• The receivers or endorsee as although the original liability remains with the shipper even after transfer of the bill by virtue of section 3 (1) of cogsa 1992 liabilities also transfer with the bill to the ultimate receiver, and

• The Charterers.

 

• Under English common law there is a term implied into contracts of carriage that shippers will not load dangerous goods without the shipowner's knowledge and agreement prior to shipment.  Also the Hague and Hague-Visby rules (art iv r 6) provides that the shipper of goods shall be liable for all damages and expenses arising out of shipment of dangerous goods.

• The phrase "dangerous goods" has been given a broad meaning and is not confined to goods of an inflammable or explosive nature such as acids, explosives, arms and ammunition, but has been defined by the House of Lords as simply a cargo that is likely to cause damage or delay.  It has further been decided by the House of Lords that the obligation upon the shipper not to ship dangerous goods creates a strict liability. 

• The obligation does not depend upon the shipper having knowledge of the dangerous nature of the goods and failing to communicate that danger to the shipowner.  Where the shipper had no knowledge or means of knowing the dangerous nature of the cargo he is still liable.