Hague Visby Rules PDF

Preview

Summary

Download Hague Visby Rules PDF

Description

Hague Visby Rules Scope of Application Factors determining applicability  Type of Document covering the Contract of Carriage  Kind of Carriage  Kind of Cargo carried Documents  Article 1(b) Rules come into operation where a Bill of Lading or similar document of title covers the contract of carriage by sea. Incorporation of the Hague Visby Rules  Section 1(6) CGSA 1971  “…the Rules shall have the force of law in relation to…  (a) any bill of lading, if the contract contained in or evidenced by it expressly provides that the Rules shall govern the contract, and  (b) 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, Kinds of Carriage – Article X  Where the carriage is between ports in two different states in the following circumstances:  Where a bill of lading is issued in a Contracting State; or  Where carriage is from a port in a Contracting State; or  Where the contract contained in or evidenced by the bill of lading specifies that the Hague-Visby Rules or the legislation of a state giving mandatory effect to them are to govern the contract.  Then the rules will apply Kinds of Cargo- Article 1(C)  The Hague-Visby Rules are applicable to all goods, wares, merchandise and articles of every kind except  live animals and  cargo which by the terms of the contract of carriage is stated as being carried on deck [deck cargo], and is so carried. Deck Cargo  The rules will only be excluded when both requirements are met:

 (1) The Cargo must in fact be stowed on deck; and  (2) The stowage of the cargo on deck must be made explicit on the face of the bill of lading.  Svenska Traktor v Maritime Agencies [1953]- Svenska Traktor v Maritime Agencies  A consignment of tractors had been shipped from Southampton under a bill which conferred a liberty on the carrier to stow the cargo on deck. During the voyage one of the tractors was washed overboard. The Court held that the Rules were applicable. A mere general liberty to carry goods on deck was not a statement in the contract of carriage that the goods were in fact being carried on deck.  The carrier was held for a breach of Art III rule 2 in failing to look after the cargo properly and carefully during the transit. Period of Coverage  Article 1(e)  The Hague-Visby Rules apply to the contract of carriage from the ‘time when the goods are loaded to the time when they are discharged from the ship.’  Pyrene Co v Scindia Navigation [1954] Pyrene Co Ltd v Scindia Steam Navigation Co Ltd [1954] 2 QB 402  Facts  The plaintiff delivered a fire tender which was sold by a contract of sale. As the tender was being lifted onto the ship, before it crossed the rail on the ship, it was dropped and subsequently damaged. As per the contract of sale between the parties, the possession of the property had not passed at this stage. A bill of lading had been drawn up but was not issued. The sellers sued the owners of the ship for the cost to repair the tender. The owners of the ship admitted liability but argued their liability would be limited by the Hague Rules, Article 4 (5).  Issue  The sellers of the tender claimed that as the goods had not crossed the rail of the ship, the incident had occurred off of the ship and therefore outside the scope of the Hague Rules. Further to this, because the bill of lading had not been conveyed, these terms had not been included in the contract between the parties. Lastly, the seller argued that even if the term had been included in the contract, they could not be applied in the agreement between the ship-owners and themselves.  Held  The court held that limited liability under the Hague Rules did extend to the loading of the cargo on to the ship. Moreover, it was found that the bill of lading was irrelevant and the contract could be regarded as the incomplete bill of lading on the basis that all three parties were deemed to have a benefit from the agreement. As a result of this finding, the plaintiffs could only recover £200 as per the Hague Rules which were considered to be included in the contract.

Interpretation of the Hague-Visby Rules  The Rules are silent as to their interpretation.  Stag Line Ltd v Foscola, Mango & Co [1932]

 Pyrene & Co Ltd v Scindia Navigation Ltd [1954]  Stag Line Ltd v Foscola, Mango & Co [1932]  English statutes which give effect to international conventions need to be interpreted with the international origin of the rules well in mind. The Act only applies to contracts of carriage of goods outwards from ports in the United Kingdom, and the rules will often have to be interpreted in the courts of the foreign consignees, and should be read according to their own meaning without too great reliance on earlier cases. The Hague Rules are an international convention. Their interpretation is ‘not to be rigidly controlled by domestic principles of antecedent date but they are rather to be construed on broad principles of general acceptation.’ – Lord Macmillan. Carrier’s Duties and Liabilities  Article 1(a)  defines carrier to include the owner of a vessel or charterer who enters into a contract of carriage with the shipper. Seaworthiness  Article III(1) the carrier is under an obligation before and at the beginning of the voyage to exercise due diligence to:  Make the ship seaworthy;  Properly man, equip and supply the ship; and  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. Seaworthiness  Due diligence is a question of fact.  The Amstelslot [1963]  The responsibility of exercising due diligence to make the ship seaworthy is personal  The Muncaster Castle [1961] -The Muncaster Castle, [1961] 1 Lloyd’s Rep 57  The Muncaster Castle, 1961, where cargo was damaged by seawater entering the cargo compartment because a fitter from a ship repairing company had failed to seal an opening in the vessel during an inspection some months before the damage. After the inspection by a Lloyd’s Register of Shipping surveyor, the fitter’s replacement of the inspection covers was negligent. The replacement was not supervised by the senior officers on board the vessel and this was the lack of exercising “due diligence”. There was no question of the surveyor’s being diligent or not.

 In The Muncaster Castle the delegate was not diligent and this caused the carrier to fail to show his own diligence. If the delegate is diligent, this can establish the diligence of the carrier who delegates the task of making the vessel seaworthy. In The Amstelslot, 1963, the carriers had exercised due diligence to make the vessel seaworthy because the delegate surveyor had acted carefully and competently. Delay was caused by an engine breakdown resulting from metal fatigue. The vessel had been surveyed by a surveyor from Lloyd’s Register of Shipping but he had failed to detect that the fatigue could occur despite having taken reasonable care in carrying out the survey.  “There is nothing, in my opinion, Extravagant in saying that this is an inescapable personal obligation. The carrier cannot claim to have shed his obligation to exercise due diligence to make his ship seaworthy by selecting a firm of competent ship-repairers to make his ship seaworthy. Their failure to use due diligence to do so is his failure”. Seaworthiness  Seaworthiness (Before and at the beginning of the voyage…)  Maxine Footwear v Canadian Government [1959]  The burden of proof:  Article IV (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.  Maxine Footwear v. Canadian Government Merchant Marine, 1959  In this case the obligations in Art. III, r. 1 were said- to be “overriding”. They must be proved before reliance is permitted on the exceptions or limitations to liability. The cargo claimant will then attempt to disprove the carrier’s evidence that the obligations were carried out. If the claimant cannot prove that the obligations in Art. III, r. 1 were not carried out, he can rely on Art. III, r. 2 and attempt to prove that the cargo was not loaded, etc., properly and carefully. In any case, under the Hague Rules or Hague Visby Rules the carrier is relatively protected, the cargo claimant having considerable burden of proof. Cargo Management  Article III(2) the carrier is required to properly and carefully load, handle, stow, carry, keep, care for and discharge the goods carried  Gosse Millard v Canadian Government [1927]  Gosse Millard v Canadian Government [1927]  Greer LJ : ‘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 the damage is a neglect to take reasonable care of the ship or some part of it, as distinct from the cargo, the ship is relieved from liability’. Documentary Responsibilities  Article III(3) the carrier is under an obligation ‘on demand’ by the shipper to issue a bill of lading which contains, amongst other things:

 the leading marks necessary for the identification of the goods,  the number of packages or pieces,  the quantity or weight of the goods, and  the apparent order and condition of the goods  Article III(4) – Evidential value Documentary Responsibilities  Article III(4) – Evidential value  Such a bill of lading shall be prima facie evidence of the receipt by the carrier of the goods as therein described in accordance with paragraph 3 (a), (b) and (c). However, proof to the contrary shall not be admissible when the bill of lading has been transferred to a third party acting in good faith. Duty to pursue contract voyage  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. Carrier’s Immunities  The Hague-Visby Rules provide a wide list of exceptions in favour of the carrier.  The carrier under the Rules cannot increase the list of exceptions, since they will be regarded as an attempt to lessen his liability, and as such void under Article III (8). Unseaworthiness  Under Article IV, rule 1, the carrier is not liable for loss or damage that is a consequence of unseaworthiness so long as he has exercised due diligence to make the ship seaworthy. Negligence in Navigation or Management of the Ship  Article IV, rule 2(a), the carrier is not liable for loss or damage to the goods as a result of the act, neglect, or default of the master, mariner, pilot or servants of the carrier in the navigation or management of the ship. Fault in navigation?  Faults in navigation has been construed as applying to situations where, due to the negligence of master or crew, 

the vessel struck a reef/rock : The Portland Trader [1964]



ran aground: Compliant of Grace Line [1974] AMC 1253



or collided with another vessel: The Xantho (1887)

‘Fault in management of the ship’ or ‘lack of proper care of the cargo’?

 Difficult to distinguish ‘fault in the management of the ship’, which falls within the exception, from the carrier’s duty under Art III(2) to take proper care of the cargo, which does not.  In such circumstances the courts tend to have regard to the property primarily affected by the conduct in question. Negligence in Navigation or Management of the Ship  Article IV, rule 2(a), the carrier is not liable for loss or damage to the goods as a result of the act, neglect, or default of the master, mariner, pilot or servants of the carrier in the navigation or management of the ship. ‘Fault in management of the ship’ or ‘lack of proper care of the cargo’?  Difficult to distinguish ‘fault in the management of the ship’, which falls within the exception, from the carrier’s duty under Art III(2) to take proper care of the cargo, which does not.  In such circumstances the courts tend to have regard to the property primarily affected by the conduct in question. Gosse Millerd v Canadian Government Merchant Marine [1927]  Greer LJ : ‘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 the damage is a neglect to take reasonable care of the ship or some part of it, as distinct from the cargo, the ship is relieved from liability’.  This case will look at the comparison between fault of management of the ship or lack of proper care of cargo  Goose Millerd is a leading case and the facts of the case state that the vessel had to go into the docks for repairs and due to failure to replace the top lanes the rain water went into the holds and damaged the cargo  But if the cause of the damage is negligence to take reasonable care of the ship or some part of it, as distinct from the cargo, then the ship is relieved from its liability  So by looking at this case, when facing the problem of whether a damage or loss of goods was caused by the fault of management of the ship or caused by lack of proper care of cargo, in such circumstances the courts tend to have regard to the property primarily affected by the conduct in question. Fire  Article IV, rule 2(b), the carrier is excluded from responsibility for loss or damage arising or resulting from fire unless caused by the actual fault or privity of the carrier.  Tempus Shipping Co v Louis Dreyfus [1930]: not heat  Maxine Footwear Co Ltd v Canadian Merchant Marine [1959]  Fire is another immunity of the carrier which is explained under article 4 rule 2(b) of the HV Rules

 Here the carrier is excluded from responsibilities for loss or damage arising or resulting from fire unless caused by the actual fault or privity of the carrier  So this means that if loss or damage is caused by fire as long as the fire was not caused by the carrier’s fault or the privity of the carrier, then the carrier will not be liable Maxine Footwear Co Ltd v Canadian Merchant Marine [1959]  Due diligence to make the ship sea worthy is an overriding obligation and this is why if it is not fulfilled and the non fulfillment caused the damage which is relevant to the fire, then in these circumstances the carrier will still be liable  Thus, the according to the legal principle established in this case, the carrier has a duty to provide a sea worthy vessel and if the vessel was not sea worthy before or at the beginning of the voyage and this non fulfillment of the duty regarding sea worthiness led to fire and caused damage to the goods, then in these circumstances the carrier will be liable because he has breached his duty of seaworthiness  And he will not be able to rely on the immunity of fire under art 4 rule 2 (b) Perils of the Sea  Article IV, rule 2(c) the carrier is not liable for loss or damage to the goods where it has occurred due to the perils, dangers and accidents of the sea, or other navigable waters.  Art rule 4 (2)(c) carrier will not be liable for loss or damage where it has occurred due to the perils, dangers and accidents of the sea, or other navigable waters.  Typical examples of perils of the sea would be strong waves for example  And if for instance, loss or damage was caused by perils of the sea such as strong waves then the carrier will not be liable Act of God  Article IV, rule 2(d) the carrier is not liable for loss or damage to the goods that has resulted from an Act of God.  Nugent v Smith [1876]  Siordet v Hall [1828]  Shipowner was not able to plead act of God where the cargo was damaged by water escaping from a busted pipe following a hard frost  The court was of the opinion that he could have been aware of the likelihood of the frost and should have drained the boiler while the vessel was at the port (taken reasonable steps to avoid the consequences) Other Immunities under the Rules : article IV Such as Act of war, Act of public enemies, riots.

Catch-all exceptions  Art IV rule 2 ‘…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, but the burden of proof shall be on the person claiming the benefit of this exception to show that neither the actual fault or privity of the carrier nor the fault or neglect of the agents or servants of the carrier contributed to the loss or damage’  Leesh River Tea Co v British India Steam Navigation [1966]  If the person manages to do so, then the carrier will not be liable for any such loss or damage  Such an exception was considered to be a ‘catch-all’ exception  It seems to provide protection to the carrier against any loss or damage to the goods as long as the loss or damage is caused without the actual fault or privity of the carrier  Or without the fault or negligence of the carrier, or carrier’s agents or servants  Also carriers are not keen on relying on such catch all exceptions because of its heavy burden of proof  Meaning the carrier will have to prove that there is a lack of his fault or a lack of his servants  Thus, due to these two reasons (1. long list of immunities already exist and 2. heavy burden of proof on carrier) this is why the catch all exception is rarely used Time Limit  Article III, rule 6 provides that the carrier and the ship shall, in any event, be discharged from all liability in respect of the goods unless suit is brought within one year of their delivery or of the date on which they would have been delivered  So the time limit under the HV rules is a year so if the shipper would like to bring a claim against the carrier then he will have to do so within a year, after the delivery date of the goods or after the date on which the goods would have been delivered if delivery did not take place Financial Limit  Art IV (5)(a), Unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading,  neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the goods in an amount exceeding 666.67 units of account per package or unit or 2 units of account per kilogramme of gross weight of the goods lost or damaged, whichever is the higher.  units of account :such as £, $

 This means that if the shipper can hold the carrier liable and you manage to bring the claim against carrier within time limit (which is one year) however,  There is a limit of how much a shipper is entitled to financially because of this protection of financial limit provided to the carrier  However, it is possible for the carrier to lose the protection of limitations which we will now consider Loss of limitation  Art IV (5)(e) Neither the carrier nor the ship shall be entitled to the benefit of the limitation of liability provided for in this paragraph if it is proved that the damage resulted from  an act or omission of the carrier done with intent to cause damage, or recklessly and with knowledge that damage would probably result. Contracting Out  The Hague-Visby Rules are meant to have mandatory effect. The carrier, however, may issue a carriage document that does not attract the application of the Rules, or include clauses that reduce his liability below the level set by the Rules. ◦

Brown International v Monarch Shipping (The European Enterprise) [1989]

 Article III, rule 8 renders any ‘clause, covenant or agreement which attempts to relieve or lessen that liability’ which the carrier would otherwise have under the Rules, as being null and void. ◦

The Morviken [1983]

Shipper’s Duties & Immunities  Article 1(e), the carrier’s responsibilities for the goods start from the time when the goods are loaded, which suggests that the shipper has to bring them alongside the ship.  However, naturally the ICL will allow the parties to freely determine...