Kum v Wah Tat bank (1971): goods delivery without BOL. The bank contended mate receipts is same as BOL in the trading custom, but failed.

Factors Act 1889 - maybe document of title where it is "proof of possession or control of goods"

Voss Peer v APL (2002) Singapore case - Sea waybill is not same as straight BOL.
The Rafaela S [2005} House of Lords- way bill is not straight BOL.

holding himself as "carrier"; "to carry"; Lien in goods; is "Shipper" under actual carrier's BOL, then Issue its own BOL to shipper; Lump sum;

" to arrange for carriage"; Identify actual carrier in BOL; Commission

The TNT Express (1992) the OZ case. "apparent good order and condition" is only referring to the container not the goods inside.

Silver v Ocean Steamship (1930) - eggs from China to UK were damaged. BOL states "in apparent good order and condition". Good faith holder of BOL claimed damages from shipowner. Shipowners defense with "insufficient package" under hage-visby rule. Held 3rd part win and shipowner is estopped from denying good condition and invoking the exception in Hague-Visby rules.

The David Agmashenebeli [2003] - objective standard of reasonably observant master, not master's personnel opinion even if its honest (but could be eccentric)

"said to be"; "said to contain xyz quantity"/i.e. STC; "Weight, measure, marks, numbers, quality, content and value unknown" - with these qualifications, BOL cannot constitute a prima facie evidence (certainly not conclusive evidence) because the subject matters are unknown to the master

Article III, Rule 4 is similar to common law position, apply to BOL and other document of tittle

S.4: carrier vs. lawful holder of the bill : conclusive evidence - ⚠ apply only to BOL, NOT any other document of title.

⚠Exception-Pledge (i.e. security for finance) - the mere endorsement and delivery of BOL by way of pledge does not pass the property in the goods to the endorsee. ‼ But the contract right will pass based on COGSA 1992

The Wear Breeze (1969) - cargo damages on the way. The claimant who is the buyer sue in tort for negligecne before cargo delivery. Held action in tort of negligence would not lie because the claimant is not the owner of goods in question before discharge.

must have "to order" or "to bearer".- vital word of negotiable BOL ‼
Must state the goods have been "shipped", i.e. not received for shipment BOL.

The Aegean Sea (1998) - completion of endorsement by delivery - not sufficient if a person is in possession of BOL merely in consequence of someone endorsed it and sent it to him. The person must also himself accept the delivery.

The Ythan [2006] - Goods sold under CIF. Vessel and goods were lost. BOL was kept with seller's bank. After loss, buyer settled with his insurerer. As per insurerer instruction, he paid to seller's bank. The BOL goes to insurer. Held buyer is not lawful holder, has no right of suit. Because the trasaction of insurance settlement and between insurerer and seller is not a normal transaction which has nothing to do with the normal course of trading.

Motis Exports Ltd v Dampskibsselskabet (2000) - ship owner who issued the BOL is liable for loss against delivery on forged BOL. The ship owners has duty to ensure the integrety of the BOL. Exclusion clause needs to be clear and specific. Broad and wide exclustion clause does not work.

Case of Indemnity
CoastLines v Huding [1972] - even without express indemnity. there is an implied term in the charterparty for charterer to indeminty the greater liability than that contained in the charterparry after master signed

The Starsin [2004] House of Lords - the face of the bill is clearly charterers bill, but the reverse contains demise clause and carrier identity clasue both indicating carrier's bill. Held: one should look for the identity of the carrier on the face of the bill rather than the clauses on the reverse.Reading the terms on the reverse was not something that the 'reasonable reader of the bill of lading' did."

In Encyclopaedia Britannica v Hong Kong Producer (1969) - a bill authorized the carrier to stow the cargo on deck unless shipper objects. Held that Rules apply since the bill of lading nowhere states that the cargo is being carried deck. Clause 13 says it may be so carried but not that it is being so carried. No consignee or assignee could tell from the bill whether it was below deck or on deck cargo.

Trade Custom
Consent would normally be implied where it was customary in the trade to ship cenain types of goods on deck, for example timber or containers on a specially designed container vessel. In such a case, it would not be necessary-to clause the bill of lading indicating deck carriage.

Pyrene Co Ltd v Scindia Steam Navigation Co Ltd [1954]- "the contract of carriage is always concluded before the bill of lading, which evidences its terms, is actuaIly issued...for the issue of the bill of lading does not necessarily mark any stage in the development of the contract; often it is not issued till after the ship has sailed ..."

As per contract law - i.e. effective as long as steps have been taken to bring it reasonably to the notice of the shipper before or at the time he enters into the contract of carriage.

‼ equitable doctrine of constructive notice is inapplicable
Manchester Trust v. Furness (1895) - not binding on the holders of the bill who had notice of the existence of the charter party by reference to it in the bill. Lindley L.J rejectied an argument that reference to the charter gave constructive notice of the clause

A reference to 'all terms, conditions, and exceptions to be as per charterparty' refer only to those relating to the main undertakings in the bill of lading agreement, ‼ Arbitration or exclusive jurisdiction for litigation clauses are not incorporated

On carrier to prove causation that his negligence had not contributed to the loss suffered

Strict liability for cargo damage, unless falls under the following exemptions:
1) Act of God
2) Act of public enermy
3) Inherent Vice of cargo
4) insufficient package by shipper
5) general average

physically dangerous or non-physically dangerous goods (e.g. political danger)

Master can refuse if differerent from description.
if master agree, the carrier may claim an enhanced rate of freight

The Sussex Oak (1950)- time charter case- "could not think 'that the clause in the time charter-party which puts the master under the orders of the charterers as regards employment is to be construed as compelling him to obey orders which the charterer has no power to give'.

The Giannis NK (1998) House of Lords confirmed shipper's obligation to give notice is a strict obligation that does not depend on shipper's knolwedge. "the liability of a shipper for shipping dangerous goods at common law, when it arises, does not depend on his knowledge or means of knowledge that the goods are dangerous."

The Giannis NK (1996) - Court of Appeal-"Article IV, rule 6 is a free standing provision dealing with a specific subject matter. It is neither expressly, nor by implication, subject to Article IV rule 3. It imposes strict liability on shippers in relation to the shipment of dangerous goods, irrespective of fault or neglect on their part"

The unsafe factors:
-natural causes, such as storms, ice, or fog or
-political factors, such as the outbreak of war, or the fear of capture by hostile forces.

the Olympias (1880), the Olympias deviated to save the crew and also to salvage by towing the vessel in distress, the Arion. While attempting the towage, the Olympias herself grounded and was lost with all her cargo. The Court of Appeal found that the deviation was unjustifiable, and that the claimant charterers were entitled to recover the value of the cargo.

Liberty Clause - cannot frustrate the object of the voyage, "namely the safe carriage of a perishable cargo"

⚠ Freight: If there is an unjustifiable deviation, freight due on delivery of the goods would no longer be payable.
However there are dicta to the effect that, should the cargo be delivered safely to its destination, the carrier would be able to claim a reasonable sum for freight based on quantum meruit.
Hain Steamship Co v Tate & Lyle, (1936)

Bailment
The bailee who stores goods other than in the place contemplated may find that he is liable for all loss which occurs while the goods are so stored unless he can prove that the loss would anyway have occurred, even if they had been stored in the agreed place.

In The Paras (1987) - HELD owner can claim from Charterer based on this Rule as if Charterers is shipper and Owner is carrier.
⚠ But in The Boukadoura) (1989) held, obiter, that there was no right to an indemnity unless there was an express provision in the charterparty to that effect.
🏁 Author's view: the better view is the former one (the Paras) because there is no logical reason for excluding such a claim in the context of the incorporation of the Rules into a charterparty.

The burdern of proof, although appears to be on carrier, has in practice over a long period of time been replaced by the common law scheme of proof, i.e. by claimant.

The Muncaster Castle (1961) - The obligation in article III, rule 1 has been interpreted as being personal and not delegable. If particular responsibilities are delegated to independent contractors or Lloyd's surveyors, and those persons are negligent, the carrier remains liable. It is no defence for him to argue that he engaged reliable experts or indeed that he himself lacked the necessary expertise to check their work.

The Happy Ranger [2006]- A new build vessel on her first voyage. The vessel crane's failure which damaged the cargo. The crane had never been tested to its safe working load. The shipowners contended not liable for the negligence of the crane manufacturers prior to the delivery of the ship by the shipbuilders. The court agreed that the ship had not come 'within the shipowner's orbit' until delivery and accordingly it was not responsible for any negligence prior to the delivery. However the shipowner failed to exerccise due diligence to make the ship seaworthy after taking delivery because after delivery they failed to appreciate that there had been no adequate proof testing of the hooks. and the shipowner had not exercised due diligence in obtaining special exemption for lifting and the classification society. The shipowner is also responsible for the class society that they had not carried out its function of granting the exemption with due diligence.

S3 There shall not be implied in any contract for the carriage of goods by sea to which the Rules apply by virtue of this Act any absolute undertaking by the carrier of the goods to provide a seaworthy ship.

Maxine Footwear Co Ltd v Canadian Government Merchant Marine Ltd (1959) Article III, rule 1, is an overriding obligation. If it is not fulfilled and the nonfulfilment causes the damage the immunities of article IV cannot be relied on. This is the mnual construction apart from the opening words of article III, rule2. The fact that that rule is made subject to the provisions of article IV and rule 1 is not so conditioned makes the point clear beyond argument. but it should be noted that this reasoning is not necessarily followed in all jurisdictions. (such as France, USA)

It has been held that a breach by the carrier of article III, rule 1 will not deprive him of his right to limit his liability under the Rules.

Seaworthy is an innominate (or intermediate) term - by the Court of Appeal in Hongkong Fir Shipping Co v &wasaki (1962)

subject to contract construction

A breach of the implied obligation is the breach of an innominate term.

Non-delegable to the subcontractor, servants or agents of the carrier, but subject to the exceptions of article IV.

The Jordan II (2005) - FIOST term (free in and out, stowed and trimmed), The shipper/charterer claimants argued that the effect of these clauses relieved the shiponer/carrier from their duties under article III, rule 2 of the Rules and were void and of no effect pursuant to article III, rule 8. The judge concluded that article III, rule 2 did not oblige the carrier to load, stow,carry, and discharge the goods properly and carefully; but only obliged the carrier to do so if it had agreed to perform those functions. The shipowners were under no liability for damage caused by loading, stowage, dunnage, securing, or discharging, article III, rule 8 did not render the charterparty clauses null and void.

The Lonar I (1983) - absent of express term, freight is paid upon delivery of goods at their destination on presentation of BOL or letter of indemnity. Paymeng needs to be made before discharge, this is to preserve right of lien.

Lum sum freight - general rule against deductions / set-off -full freight would be payable even where a failure to deliver all the cargo shipped was attributable to fault on the part of the shipowner. any cargo claim would have to take the form of a separate action.

The Giannis NK (1998) the shippers had endorsed the bill oflading to their immediate purchasers and so the property in the cargo had passed to those purchasers. Were the shippers divested of their liability for the carriage of dangerous goods by virtue of the endorsement to the purchasers? Unless expressly provided, shipper cannot divest his responsibility for the loss arising from shipment. The judge looked at common law position that the shipper would have remained liable, notwithstanding endorsement of the bill of lading. He also emphasized that section 3(3) of the Carriage of Goods by Sea Act 1992 had made this point explicit.

S 3(1) the consignee or endorsee who obtains title to sue under the 1992 Act will not automatically become subject to the obligations under the contract (including payment of freight). These will only attach when he seeks to enforce the contract, either by taking or demanding delivery of the goods from the carrier, making a claim under the contract of carriage, or having taken or demanded delivery of the goods before acquiring title to sue.

East West Corp v DKBS 1912 [2003] - Cargo damage upon delivery. BOL has been consigned to the bank from the seller. Seller sued. Held Seller has no right to sue. Right to sue has been transferred to the bank pursuant to s. 5(2)(a) and s.2(5)(a).
‼ However, the bank has no property right from common law (i.e. right to sue in tort for economical losses and in bailment)

The David Agmashenebeli [2003] - objective standard of reasonably observant master, not master's personnel opinion even if its honest (but could be eccentric)

The Sussex Oak (1950)- time charter case- "could not think 'that the clause in the time charter-party which puts the master under the orders of the charterers as regards employment is to be construed as compelling him to obey orders which the charterer has no power to give'.

Burden of proof is on the claimant (‼ not the owener or carrier) to prove vessel is not seaworthy and causation of loss.

⚠ Generally, exception clause does not work if loss is caused by unseaworthy
e.g. Seaworthiness vs exemption of Negligence: if chain of cause is: loss <- unseaworthy <- owner's negligence- Exception clausue on negligence dose not apply

case on Time bar -
The Antares (1987) House of Lords been held that the unauthorized carriage of cargo on deck, while constituting a breach of the contract of carriage, will not prevent a carrier from relying for protection against a cargo claim on the Rules time limitation.

English law case on Excetption clause
The Kapitan Petko Voivoda (2003) Held The question as to whether the carrier may rely on any provisions of the Rules is one of construction of its terms.

(Southampton) (1953) - Court of Appeal.
a) the clear statement of carriage on deck on bill is not satisfied by a mere general liberty clause. Hence the Rules are operative.
b) with a liberty clause in the bill of lading, deck.stowage did not amount to a breach of the contract of carriage. The carrier can rely on the defences provided by the Rules.

Doctrine of Stages (for voyage charter) . ⚠ vs Hague-Visby NO such doctrine

⚠ no doctrine of stages under the Hague and Hague-Visby Rules because 'Voyage' is construed as covering the entire voyage covered by the bill of lading, irrespective of calls at intermediate ports.⚠ vs. Doctrine of stages at common law

The Fiona (1994) - vessel not proerly cleaned hence not cargo worthy (seaworthy) for fuel oil. Cargo exploided caused by vessel unseaworthy (because of residual cargo) resulted in death and vessel damage. Carrier claims indemnity under Art IV Rule 6 for indemnity from Shipper. Shipper defend based on Art III Rule 1 due diligence of seaworthiness. Held the cause is vessel unseaworthiness, owner cannot seek for indemnity from Art IV Rule 6.

extend common law position futher to cover saving property and reasonable deviations.

liberty clauses amount to performane of the contract of carriage and will not be caught by articule III Rule 8.

s 93(1) The master of a ship, on receiving at sea a signal of distress or information from any source that a ship or aircraft is in distress, shall proceed with all speed to the assistance of the persons in distress ...The consequences for a breach of the obligation can include, for a summary conviction, imprisonment for a term not exceeding six months, or a fine not exceeding the statutory miniumum, 'or both'. For a conviction on indictment, the penalty is imprisonment for a term not exceeding two years, or a fine, 'or both' . The ambit of this statutory obligation and its consequences is, however, limited as it does not extend to events occurring on the high seas, outside the territorial sea of UK.

Excepted perils can prevent the shipowner being sued for losing or damaging the cargo, but they do not give a right to freight.

The Giannis NK (1998) - the rule is not limitd to physcially danagerous goods only. The positin is similar to Common law now.

Mayhew Foods (1984) - UK port to UAE port, but with storage and transhipment in France port - Held carrier has contractualright to discharge, store and tranship. those were, operations 'in relation to and in connection with the carriage of goods by sea in ships' (Carriage of goods by sea act 1972 s.1(3). The conclusion is that the rules, having applied on shipment at UK port remained continuously in force until discharge at UAE port.

The Hollandia (1983) - from UK (HVB) to Netherland(Hage only), BOL has Dutch law clauses also provide that Court of Amsterdam should have exclusive jurisdiction in any dispute. Cargo Damage. Section X of HVB is mandatorily appliecable - becasue BOL is issued in UK and cargo shipped from UK port. HVB applies regardless of the applicable law in cpa is Dutch law.

The European Enterprise (1989) - non-negotiable document for cargo from UK to france. Paramount clause but also lowered the limitation. - Held not contradict with Rule 3 of HVB. For non-negotiable documents, parties have freedom to incoporate part of the rules.

Clauses not nullified
-liberty to deviate will not infringe the Rules.
-liberty to have cargo transhipped on terms
-liberty to carry on deck.
-Demise clause / carrier idenity clause and Circular indemnity clauses

Gosse Millerd Ltd v Canadian Government Merchant Marine Ltd (1929) - the House of Lord follow pre-Hague judement- "the management of the ship" was interpreted as excluding liability for bad stowage.

the courts unlikely apply the concept of deviation. Lord Hobhouse said in the House of Lords [2001] “[deviation] was not directly material to a time charter where the contract is not a contract of carriage but a contract for the provision of the services of a crewed vessel.”

Unless for the safety of ship, crew and cargo, otherwise failure includes:
1) sails at reduced speed (The Pearl C [2012])
2) take a route other than the shortest and quickest (The Hill Harmony [1998]);
3) puts into, or delay at, a port of refuge unnecessarily (Istros (Owners) v. Dahlstrom (1930)
4) Refuses to put into a port to which he has been ordered by the Charterers (The Charalambos N. Pateras [1972] );
5) prevents the loading or discharge of cargo (The Agios Giorgis [1976])

Where unsafety arises after arrival but ‼ not due to an abnormal event ‼, the owners will ordinarily be entitled to an indemnity from the charterers against any loss or damage caused by that unsafety, as a consequence of compliance with their orders

Bill of Lading Case
Aegean Sea {1998} ... [I]t does not follow that such a term should be implied into this bill of lading, ... charterer often insure his liabilities under a charterer's liability policy. In the case of a bill of lading that liability as to safety will be passed to the lawful holder ... and it would be unlikely that they would ever contemplate insurance against such liabilities as the holders of a bill of lading, assumingsuch insurance was available

Voyage Charter Case
In Reardon Smith Line v. Australian Wheat Board (The Houston City) (High Court of Australia) [1954] a voyage charter case when ports are specified “the shipowner must take the responsibility of ascertaining whether he can safely berth his ship there or will take the risk of doing so.”

“always lie safely afloat”. – maybe implied term of safety

in The Ocean Victory [2014] “The enquiry in an unsafe port case is not into the conduct of the port authority, for example, whether it has acted reasonably or otherwise. Rather, the enquiry in an unsafe port case is into the prospective exposure of the vessel, when arriving, using and leaving the port, to a danger which cannot be avoided by good navigation and seamanship.”

(i) common law freight (i.e freight upon delivery);
(ii) general average contributions;
(iii) expenses in protecting and preserving the goods.

1) rely on physical possession
2) not limited to contractual parties. Can be exercised against non-contract party.
3) only exercisable on freight payable upon delivery (i.e. the common law freight) - common law lien is not available to freight paid before delivery (such as advance payment); also not available for freight due after completion of discharge
4) The lien may not be exercised over goods on different voyages covered by different contracts of carriage.
5) no right of sale of the goods (even if resultant expensis is high), unless the goods have been abandoned. If the lien is lawfully exercising their lien, the charterers remain liable for hire / demurrage, and costs of storing and safeguarding the cargo, irrespective of whether the charter has been terminated:
6) Notice - ‼ date of notice, if too late, lose chance to secure freight payable
7) ⚠ the owners continue to be bailees of the cargo and owe the charterers a duty to take reasonable care of the cargo.

1) explicit contract wordings will replace default common law position
2) exerciseable only aganist party to the contract (But potentially exercisable against holder of BOL, if the full terms of CPA clause have been incoporated into the BOL)

The Mi!hafios Xi!as (1978) "The essence of the exercise of a lien is the denial of possession of the cargo to someone who wants it. No one wanted the cargo in Augusta (in the mid of the route) and the owners were not denying possession of it to anyone. It may be possible to exercise a lien by refusing to complete the carrying voyage, but I think that this can only be done when, owing to special circumstances, it is impossible to exercise a lien at the port of destination and any further carriage will lead to loss of possession of the cargo following the arrival at that port."

Place to exercise-anchored off the declared port of discharge

The Lancaster [1980] holding that the lien is not propitiatory right. Charterers can only restrain the owners from resuming control over the use of the ship “presumably by injunction”. But no more further rights such as insurance money.

The Ugland Trailer [1985] the lien must operate as an assignment, transferring the charterers’ right of action to the owners; and the assignment is made only as security for the performance of charterers’ obligations under the charter.
Agnew v. Commissioners of Inland Revenue (Re Brumark Investments) [2001] rejected the view. obiter that the lien was a purely personal right to intercept a debt: that is, a right which, unlike an assignment, produced no proprietary effects.
The Western Moscow [2012] preferred the earlier analysis, holding that the owners’ lien over sub- freights operates as an assignment by way of charge.

1) The floating charge crystallises when serving notice
2) perfecting an equitable assignment of the relevant sub- freights. The perfected assignment takes effect as an equitable charge. (not a legal assignment. A legal assignment must satisfy the requirements of Section 136 of the Law of Property Act 1925)

An assignee cannot be in a better position than his assignor. Every assignor must be in a position to exercise the lien, in order that the owners, as final assignees, may do so.
⚠ A term in any contract (down the chain of charter) prohibiting the assignment of rights arising under it is generally treated as effective to prevent an assignment of that tier.

The Cebu(No 2) (1993) "sub-freight" does not include "sub-hire" under sub-time charter.
But there are conflicating decisions.

The Shillito (1897) - Pre-paid BOL. Held" The charterer has a right to present any bills he chooses, and although there is a lien clause, it is inoperative, because there is no freight on which alien can be exercised"

The general principle - The Sinoe (1971)
it is now well established that they do not mean what they appear to say, namely that the charterer's' liability shall ceise as soon as the cargo is on board. Instead, in the absence of special wording which is not present in this charter, they mean that the charterers' liability shall cease if and to the extent that the owners have an alternative remedy byway of lien on the cargo.
On the facts, he held that clause 27 could not be relied on by the charterers, for it only came into force if the owners had an effective right to a lien on the cargo. On the evidence, the right was not effective. The umpire in arbitration proceedings had found that the combined effect of local law and practice in Chittagong was such that no lien for demurrage could be exercised by or on behalf of the owners either on shore or on board the ship. Thus the cesser clause was of no avail to the charterers

coverage of Lien clause - Clink v Radford (1891)
The charter provided for laytime and demurrage (liquidated damage) at the discharge port, but at the load port the charter envisaged customary laytime with detention thereafter (unliquidated damage on detention). The lien clause only covers freight and demurrage, but not damage on detention at loading port. The ship was delayed unreasonably at the load port, the charterers relied on cesser clause. This was rejected by the court, because the shipowner would be left unprotected in respect of damage on detention at loading port.

lien not capable of exercise
e.g. demurrage only payable 5 days after discharge - since the cargo is already discharged, no lien can be exercised (becaue of lost of possession), lien on demurrage cannot be exercised
e.g. foreigh government does not allow the lien to be exercised

ifo is accurate, if but only if the relevant facts are "uniquely within the knowledge of the charterer"
No such duty arises when "the [true] facts are within the scope of a reasonable investigation on the part of the shipowners' servants" and "the authorities do not establish that there is invariably an implied term that the bill as presented shall correctly state the apparent condition of the cargo"
‼ It has been suggested that there is an implied warranty by charterers that the quantity which is stated on the bill of lading is accurate

time is of essence (under US Law) - ??my note: can not alwasy be a condition in US??