Was deck cargo loss excluded by bills of lading?

Insight shared by:

Gateley Legal

Article by

The vessel “Elin” encountered heavy seas on a voyage from Thailand to Algeria and part of the cargo carried on deck was lost or damaged.

The cargo interests made a claim against the shipowners in the English Commercial Court: Aprile SpA v Elin Maritime Ltd. The court was asked to decide whether Elin Maritime’s liability for the loss was excluded by the terms of the bill of lading, which provided that owners were not responsible for loss of or damage to deck cargo ‘howsoever arising’. The Hague and Hague-Visby Rules do not apply to cargo which is stated to be carried on deck and is so carried. The court therefore approached the issue under common law, which would imply an absolute obligation of seaworthiness. 

The final judgement

The claimants challenged the exclusion clause, arguing that the obligation of seaworthiness was fundamental and overriding and could only be excluded by a clearly worded clause. Relying on the 1952 Canada Steamship Lines case, they argued that since liability for unseaworthiness was not mentioned in the clause, it did not exclude that liability. Alternatively, the clause should be restricted by excluding any strict liability and leaving owners responsible for any damage caused by negligence or a failure to exercise due diligence to make the vessel seaworthy. 

The judge took as his starting point the words used in the clause, which in his view were clear. The Canada Steamship judgment simply provided guidance to interpret the words used. As a matter of plain language and commercial common sense the owners’ interpretation was correct and the clause was effective to exclude their liability.

Download the full version here:

Gateley Plc is authorised and regulated by the SRA (Solicitors' Regulation Authority). Please visit the SRA website for details of the professional conduct rules which Gateley Legal must comply with.

Got a question? Get in touch.