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You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Daewoo Heavy Industries Ltd. & Anor v Klipriver Shipping Ltd. & Anor [2002] EWHC 1306 (Comm) (11 July 2002) URL: https://www.bailii.org/ew/cases/EWHC/Comm/2002/1306.html Cite as: [2002] 2 All ER (Comm) 560, [2002] EWHC 1306 (Comm) |
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QUEENS BENCH DIVISION
COMMERCIAL COURT
Strand, London, WC2A 2LL | ||
B e f o r e :
____________________
(1) DAEWOO HEAVY INDUSTRIES LIMITED (of Korea) (2) SANKO OTOMOTIVE SANAYI VE TICARET AS (of Turkey) | Claimants | |
- and - | ||
(1) KLIPRIVER SHIPPING LIMITED (of Cyprus) (2) NAVIGATION MARITIME BULGARE LIMITED (of Bulgaria) | Defendants |
____________________
Mr R. Lord QC and Mr L. Akka (instructed by Hill Taylor Dickinson and Jackson Parton) for the Defendants
Hearing date : 16th May 2002
____________________
Crown Copyright ©
Mr Justice Langley:
"1. At all material times one or other of the Claimants were the owners of or otherwise entitled to sue in relation to a cargo of 34 brand new excavators ….
2. The First Claimant and First Defendant concluded a contract of carriage (of the cargo) as partly evidenced in writing by a fax dated 22nd August 2000… This contract was subject to and/or incorporated the Conline terms ….
3. The First Defendant was at all material times the Charterer of the Vessel Kapitan Petko Voivoda from the Second Defendant, the owner of the Vessel, pursuant to the terms of a Charter Party in the Gencon form dated 20th July 2000….
4. The excavators were shipped aboard the Vessel between 1st to 3rd September 2000 at Inchon in Korea in apparent good order and condition, and stowed and lashed under deck for carriage to Istanbul.
5. Six bills of lading dated 4th September 2000 were issued in respect of the shipment. None of the bills stated that the excavators were stowed on deck.
6. The contracts of carriage contained in/evidenced by the bills of lading and the contract between the First Claimant and the First Defendant provided for carriage of the excavators to Istanbul in Turkey.
7. The vessel sailed from Inchon on 3rd September. On about 5th September the Vessel arrived at Xingang in China where 26 excavators were discharged from the Vessel then restowed on deck. The Defendants do not allege that notice of/consent to the restowage was given to/obtained from cargo interests.
8. The Vessel sailed from Xingang on 10th September and on 12th September 2000 was in the Yellow Sea bound for Zhangiang when she encountered heavy weather …. On that day, at about 20:20hrs, 8 of the excavators on deck broke free of their lashings and were lost overboard. In addition other excavators stowed on deck suffered minor damage including rusting/wetting damage.
9. The loss of and damage to the excavators was caused by one or more of the following causes ….:
(1) perils of the seas (within the meaning of Art IV rule 2(c) of the Hague or Hague Visby Rules);
(2) inadequate lashing at Xingang;
(3) carriage of the excavators on deck;
(4) insufficiency of packing (this applies only in relation to the damage apart from the loss of the 8 excavators overboard).
10. There is no enactment of the Hague Rules in Korea.
11. The Hague Rules have been enacted in Turkey (the precise scope of enactment is or may be in issue between the parties but this issue is not material for the determination of the preliminary issues)."
"Article 2 Subject to the provisions of Article VI, under every contract of carriage of goods by sea the carrier, in relation to the loading, handling, storage, carriage, custody, care and discharge of such goods shall be subject to the responsibilities and liabilities, and entitled to the rights and immunities hereinafter set forth.
Article 3.
1. The carrier shall be bound before and at the beginning of the voyage to exercise due diligence to:
(a) make the ship seaworthy;
(b) ….
(c) make the holds … and all other parts of the ship in which goods are carried, fit and safe for their reception, carriage and preservation.
2. Subject to the provisions of Article 4, the carrier shall properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried.
….
6. In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods ….
Article 4
1. 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 and … to make the holds, … and all other parts of the ship in which goods are carried fit and safe for their reception, carriage, and preservation in accordance with the provisions of paragraph 1 of Article 3.
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.
2. Neither the carrier nor the ship shall be responsible for loss or damage arising or resulting from:
…
(c) Perils, dangers, and accidents of the sea or other navigable waters.
…
(n) insufficiency of packing
…
5. Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with goods in an amount exceeding £100 per package or unit or the equivalent of that sum in other currency, unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading.
This declaration if embodied in the bill of lading shall be prima facie evidence but shall not be binding or conclusive on the carrier.
By agreement between the carrier, master, or agent of the carrier and the shipper another maximum amount than that mentioned in this paragraph may be fixed, provided that such maximum shall not be less than the figure above named.
Neither the carrier nor the ship shall be responsible in any event for loss or damage to, or in connection with, goods if the nature or value thereof has been knowingly mis-stated by the shipper in the bill of lading.
….
Article 5:
A carrier shall be at liberty to surrender in whole or in part all or any of his rights and immunities, or to increase any of his responsibilities and obligations under this convention provided such surrender or increase shall be embodied in the bill of lading issued to the shipper.
The provisions of this convention 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 this convention. Nothing in these rules shall be held to prevent the insertion in a bill of lading of any lawful provision regarding general average."
"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."
1. Whether deck stowage was a breach (a) of the terms of the charterparty and (b) the bills of lading;
2. If so, on each off the following assumptions, namely
(a) deck carriage was the effective cause of the loss and/or damage;
(b) the loss and/or damage was caused by deck carriage and one or more of (i) inadequate lashing, (ii) perils of the sea, or (iii) insufficiency of packing.
Are the Defendants precluded by reason of the unauthorised deck carriage from relying on:
(a) the limitation provisions
(b) the other defences provided by the Hague Rules.
"clauses which were intended to protect the shipowner provided he honoured his obligation to stow goods under deck did not apply if he was in breach of that obligation; the package limitation fell within this category since it could hardly have been intended to protect the shipowner who as a result of the breach exposed the cargo in question to such risk of damage; the package limitation clause being repugnant to and inconsistent with the obligation to stow below deck was inapplicable."
"However, I think the words in any event mean what they say. They are unlimited in scope and I can see no reason for giving them anything other than their natural meaning. A limitation of liability is different in character from an exception. The words in any event do not appear in any of the other Article IV exemptions including rule 6 and as a matter of construction I do not think they were intended to refer only to those events which gave rise to Article IV exemptions. I do not attach any significance to the fact that the only other place where they appear is in Article III where it is accepted that the time-bar provisions apply both to Article III rule 1 and 2 claims. If rule 5(a) had the meaning contended for by (counsel for cargo interests) rule 5(e) would be unnecessary."
"This is not a case of fundamental breach. It is a question of construction. Interpreting the contract as I find it to have been I feel driven to the conclusion that none of these exception clauses can be applied, because one has to treat the promise that no container would be shipped on deck as overriding any question of exempting condition.
Otherwise, as I have already said, the promise would be illusory."
Geoffrey Lane LJ at page 171 referred to "any other conclusion" destroying "the business efficacy of the new agreement."
"in the absence of any usage to the contrary, deck cargo and living animals must be insured specifically, and not under the general denomination of goods."
i) On each of the assumptions (a) and (b) as to the cause of the loss and damage to the cargo the Defendants are not precluded by reason of the unauthorised deck carriage from relying on the limitation provisions of the Hague Rules.
ii) The operation of the other defences provided by the Hague Rules will depend on the facts but the Defendants are unlikely to be able to rely on them.