11

Carriage of goodsCarriage of goodsLectures by:Lectures by:Reseacher Reseacher

Dr.iur. Ellen EftestDr.iur. Ellen Eftestøøl-l-WilhelmssonWilhelmsson

22

Where and whenWhere and when– Monday 17. September 10:15 -12:00, Auditorium Monday 17. September 10:15 -12:00, Auditorium

6 Domus Academica (Urbygningen) 6 Domus Academica (Urbygningen)

– Tuesday 18. September 10:15 -12:00, Auditorium Tuesday 18. September 10:15 -12:00, Auditorium 6 Domus Academica (Urbygningen) 6 Domus Academica (Urbygningen)

– Wednesday 19. September 10:15 -Wednesday 19. September 10:15 -12:00, Auditorium 6 Domus Academica 12:00, Auditorium 6 Domus Academica (Urbygningen) (Urbygningen)

– Thursday 20. September 10:15 -12:00, Auditorium Thursday 20. September 10:15 -12:00, Auditorium 6 Domus Academica (Urbygningen) 6 Domus Academica (Urbygningen)

33

The Structure of the The Structure of the Lectures; Lectures; • Monday Monday

– Introduction; what is carriage of goods all Introduction; what is carriage of goods all about? about?

– The parties and the documentsThe parties and the documents– Historical and international backgroundHistorical and international background– Scope of Application, sectionScope of Application, section

• TuesdayTuesday– The liability of the CarrierThe liability of the Carrier– The exemption from liabilityThe exemption from liability

44

The Structure, cont.The Structure, cont.• WednesdayWednesday

– Deck cargo and dangerous cargoDeck cargo and dangerous cargo– Liability for delayLiability for delay– The amount of compensation and The amount of compensation and

limitation of liabilitylimitation of liability• ThursdayThursday

– The bill of ladingThe bill of lading– The sea waybillThe sea waybill

55

Contracts of affreightmentContracts of affreightment• At sea: a contract to perform transportation services by ship or to At sea: a contract to perform transportation services by ship or to

make a ship´s transportation capacity availablemake a ship´s transportation capacity available

• Liner trade, general cargo carriageLiner trade, general cargo carriage– Carriage of goods from one port to another. Often contracts with Carriage of goods from one port to another. Often contracts with

several cargo ownersseveral cargo owners– The contracts: Bill of lading or sea way billThe contracts: Bill of lading or sea way bill– Maritime Code section IV ”Contracts of carriage”, Chapter 13Maritime Code section IV ”Contracts of carriage”, Chapter 13

• Voyage charters, quantity contracts and time chartersVoyage charters, quantity contracts and time charters– A ship is contracted out on a voyage or time charter. The charterer A ship is contracted out on a voyage or time charter. The charterer

takes care of the commercial management.takes care of the commercial management.– The contracts: Voyage or time charterpary The contracts: Voyage or time charterpary – Maritime Code section IV ”Contracts of carriage”, Chapter 14Maritime Code section IV ”Contracts of carriage”, Chapter 14– Freedom of Contract, but NOTE § 322,2.Freedom of Contract, but NOTE § 322,2.

66

The parties in the contract of The parties in the contract of carriagecarriage• The parties:The parties:

– Contracts of Affreightment:Contracts of Affreightment:• Carrier (Norw: TransportCarrier (Norw: Transportøør)r)• Sender (Norw: Sender) Sender (Norw: Sender)

– Voyage and time charteringVoyage and time chartering• Carrier (Norw: Bortfrakter)Carrier (Norw: Bortfrakter)• Charterer (Norw: Befrakter)Charterer (Norw: Befrakter)

• Others:Others:– ShipperShipper

• The underlying saleThe underlying sale• The Norwegian Sales Act §§ 7(2) and 8The Norwegian Sales Act §§ 7(2) and 8• INCOTERMSINCOTERMS

77

The parties and othersThe parties and others• The shipper; not part of the contractThe shipper; not part of the contract

– The code establishes a quasi-contractual relationshipThe code establishes a quasi-contractual relationship– Has Has certain liabilities in relation to the carriercertain liabilities in relation to the carrier

• May claim Bill of Lading, § 294May claim Bill of Lading, § 294• Responsible for the accuracy of the statements relating to the Responsible for the accuracy of the statements relating to the

goods entered in the bill of lading, § 301 goods entered in the bill of lading, § 301

• The receiver, not party to the contractThe receiver, not party to the contract– Not mentioned in § 251Not mentioned in § 251– Might step into the contract depending of the wording of the Might step into the contract depending of the wording of the

Bill of Lading (§ 292)Bill of Lading (§ 292)• The sub contractor (performing carrier)The sub contractor (performing carrier)

– Is liable for the transport (§286)Is liable for the transport (§286)– contracting carrier is still liable (vicarious liability)contracting carrier is still liable (vicarious liability)

88

The freight documentsThe freight documents

• Issued as Issued as evidence evidence of the contract of carriage, § of the contract of carriage, § 251.251.– Bill of lading (negotiable)Bill of lading (negotiable)– Sea way bill (not negotiable)Sea way bill (not negotiable)

• The bill of lading, § 292The bill of lading, § 292– Acknowledgement that goods of a certain nature and Acknowledgement that goods of a certain nature and

quantity have been received (quantity have been received (receiptreceipt))– A A promisepromise to transport the goods to transport the goods– A A document of titledocument of title (only the person in possession of the (only the person in possession of the

bill of lading can obtain delivery) bill of lading can obtain delivery)

99

The Bill of LadingThe Bill of Lading• Signed by the carrierSigned by the carrier• Evidence of transport agreement between Evidence of transport agreement between

the line and the cargo ownerthe line and the cargo owner– Booking noteBooking note– Delivered without any formal preliminary contactDelivered without any formal preliminary contact

• Different:Different:– ””Shipped” bill of ladingShipped” bill of lading– ””Received for shipment” bill of ladingReceived for shipment” bill of lading– ””Through” bill of ladingThrough” bill of lading

• Combined documents/multimodal transportCombined documents/multimodal transport

1010

Sea waybill (§§ 308–309)Sea waybill (§§ 308–309)• Evidence that the carrier has Evidence that the carrier has

received the goodsreceived the goods• Evidence of a contract carrige by seaEvidence of a contract carrige by sea• Promise to deliver the goods at their Promise to deliver the goods at their

destinationdestination– Not negotiable!Not negotiable!

1111

Historical and international Historical and international backgroundbackground• Freedom of Contract misusedFreedom of Contract misused

– Exclusion clauses and limitation of liabilityExclusion clauses and limitation of liability• USA Harter Act 1893USA Harter Act 1893• Haag Rules (Brussels 1924)Haag Rules (Brussels 1924)• Haag-Visby Rules (1968)Haag-Visby Rules (1968)• Hamburg Rules (1978 - 1992)Hamburg Rules (1978 - 1992) --------------------------------------------------------------------------------------------• UNCITRAL; Draft convention on the UNCITRAL; Draft convention on the

carriage of goods [wholly or partly] by seacarriage of goods [wholly or partly] by sea

1212

Scandinavian solutionsScandinavian solutions• Hamburg Rules are not ratifiedHamburg Rules are not ratified• Thus; the rules in the MC are aligned with Thus; the rules in the MC are aligned with

the Hamburg rules as far as possiblethe Hamburg rules as far as possible• Separat rules on domestic transportSeparat rules on domestic transport

– The Hague-Visby Rules apply only to international The Hague-Visby Rules apply only to international transporttransport

– Norwegians wanted to harmonise the legal Norwegians wanted to harmonise the legal framework for different modes of national framework for different modes of national transportationtransportation

1313

The scope of application The scope of application • Regulated in MC § 310:Regulated in MC § 310:

– The jurisdiction of Norwegian courts The jurisdiction of Norwegian courts when the contract is providing carriage when the contract is providing carriage between two statesbetween two states•Competent when the parties have agreed on Competent when the parties have agreed on

Norway (after dispute) Norway (after dispute) •Competent when the case has necessary Competent when the case has necessary

connection to Norway – described in § 310, connection to Norway – described in § 310, para 1,a-dpara 1,a-d

1414

The choice of law The choice of law • In the case of In the case of cargo damagescargo damages, special choice of law rules; MC § 252 , special choice of law rules; MC § 252

and 253and 253

• Carriage with Carriage with a Scandinavian point of contacta Scandinavian point of contact will be subject to will be subject to Scandinavian rules on liability applied as lex foriScandinavian rules on liability applied as lex fori

• Carriage without a Scandinavian contact – the law of another Carriage without a Scandinavian contact – the law of another convention state most closely connected with the carriage. convention state most closely connected with the carriage.

• What kind of carriage?What kind of carriage?– § 252; Chapter 13 applies to ”carriage of general cargo”§ 252; Chapter 13 applies to ”carriage of general cargo”– § 253; But not to ”carriage under a charter party”§ 253; But not to ”carriage under a charter party”

• The dividing line?The dividing line?• depends upon the transportation documentdepends upon the transportation document• however, a line will be drawnhowever, a line will be drawn• Chapter 13 applies to tramp bill of ladingChapter 13 applies to tramp bill of lading• and to quantity contractsand to quantity contracts

1515

The Choice of LawThe Choice of Law• Chapter 13 applies to Nordic international Chapter 13 applies to Nordic international

trade (§252,1)trade (§252,1)• Chapter 12 applies to other international Chapter 12 applies to other international

trade in 5 situations (§ 252,2)trade in 5 situations (§ 252,2)– Agreed port of loading in a convention stateAgreed port of loading in a convention state– Agreed port of discharge in a Nordic countryAgreed port of discharge in a Nordic country– Several ports of loading agreed, actual port one Several ports of loading agreed, actual port one

of them and Nordicof them and Nordic– Transport document issued in Convention StateTransport document issued in Convention State– Transport document contains Paramount clauseTransport document contains Paramount clause

1616

Choice of Law, cont.Choice of Law, cont.• § 252 third paragraph§ 252 third paragraph

– Outside of Nordic trade: Outside of Nordic trade: – Freedom of choosing the law of a Convention Freedom of choosing the law of a Convention

State,State,– The relationship with 252 second para nr 5The relationship with 252 second para nr 5

• According to preparatory work the parties have a According to preparatory work the parties have a freedom of choicefreedom of choice

• After a dispute has arisen, the parties may agree on After a dispute has arisen, the parties may agree on how to settle it (§ 310 para 2)how to settle it (§ 310 para 2)

1717

To what extent are the To what extent are the Norwegian rules mandatory?Norwegian rules mandatory?• The rules are mandatory, but the The rules are mandatory, but the

carrier can take on more stringent carrier can take on more stringent liability (§ 254)liability (§ 254)– Exceptions; § 254,4Exceptions; § 254,4

•Rt 2004.517Rt 2004.517•Rt 2001.676Rt 2001.676

• This includes the time-bar rules (§ This includes the time-bar rules (§ 501) 501)

1818

Liability for damage, loss or delayLiability for damage, loss or delay

Sender

Receiver

Carrier

Sales Contract

Contract of affrightment

Damaged, lost, delayed goods

SjSJø

MC § 274 flg

1919

The main rule on liability; MC § The main rule on liability; MC § 275275• MC § 275: Negligence with a reversed MC § 275: Negligence with a reversed

burden of proofburden of proof• MC § 276: ExemptionsMC § 276: Exemptions

– 1) Fault or negclect in the navigation of the ship 1) Fault or negclect in the navigation of the ship oror

– 2) Fire2) Fire

MC § 276, second paragraph: not if ”initial MC § 276, second paragraph: not if ”initial unseaworthiness”unseaworthiness”

2020

Liability for loss, damaged or Liability for loss, damaged or delayed goods: § 275delayed goods: § 275• The cargo owner must prove;The cargo owner must prove;

– That the goods have been damaged while in the carrier´s That the goods have been damaged while in the carrier´s custodycustody

– That he has suffered economic lossThat he has suffered economic loss

• The carrier must prove himself innocentThe carrier must prove himself innocent– That the damage is not a result of his own or any of his That the damage is not a result of his own or any of his

servants or representatives fault or negligenceservants or representatives fault or negligence– In practical terms:In practical terms:

• How the damage actually occurredHow the damage actually occurred• That neither he nor his servants were negligent That neither he nor his servants were negligent • Borgarting lagmannsrett 2002.3075Borgarting lagmannsrett 2002.3075

NOTE! A burden of proof assumes the availability of evidence.NOTE! A burden of proof assumes the availability of evidence.

2121

What must the carrier or his What must the carrier or his servants do to avoid being servants do to avoid being branded as negligent?branded as negligent?• Breach of public regulations?Breach of public regulations?

– Container Code 1982/84Container Code 1982/84• Has the carrier enough knowledge?Has the carrier enough knowledge?• Not perfect – but reasonable fitnessNot perfect – but reasonable fitness

– The cargo owner must give the carrier necessary The cargo owner must give the carrier necessary informationinformation

– Not only the particular goods but also the type of voyageNot only the particular goods but also the type of voyage– Previous experiencePrevious experience– ND 1977.1 Tor MarciaND 1977.1 Tor Marcia– Gulating Lagmannsrett 2004.97970 (frossen akkar)Gulating Lagmannsrett 2004.97970 (frossen akkar)

2222

The periode of care, MC 274The periode of care, MC 274• while the goods are in his or her while the goods are in his or her custody custody

instead of ”instead of ”tackle to tackletackle to tackle””• At the port of loading (2. para)At the port of loading (2. para)

– From the carrier receives the goodsFrom the carrier receives the goods• At the port of discharge (3. para) until the At the port of discharge (3. para) until the

goods are :goods are :– Delivered to the receiverDelivered to the receiver– Warehoused on the account of the receiver (§ Warehoused on the account of the receiver (§

271 or agreement)271 or agreement)– Delivered to any authority according to law Delivered to any authority according to law

2323

Vicarious liabilityVicarious liability• Identification or privity Identification or privity

– The neglect of servants is considered the fault of the The neglect of servants is considered the fault of the carrier. carrier.

• Vicarious liability is only presupposed in the code § Vicarious liability is only presupposed in the code § 276, para 1 no. 1276, para 1 no. 1– Establishes pre-conditions for indentificationEstablishes pre-conditions for indentification– Includes more than those directly employed by the carrierIncludes more than those directly employed by the carrier

– Harbour workers and longshoremen? YesHarbour workers and longshoremen? Yes– Shipyard employees and inspectors ? ??Shipyard employees and inspectors ? ??

• Combined causes, § 275, 3Combined causes, § 275, 3

2424

Exemption from liability, MC § Exemption from liability, MC § 276276WHO´s fault or neglect?WHO´s fault or neglect?• Haag/Visby – HamburgHaag/Visby – Hamburg

– Excemptions a & b kept, but not for Norwegian domestic trade.Excemptions a & b kept, but not for Norwegian domestic trade.– ” ” Fault or neglect in the navigation or management of the ship”Fault or neglect in the navigation or management of the ship”

• Who´s fault or neglect is exempted? Who´s fault or neglect is exempted? – Only fault/neglect comitted by master, crew etc.Only fault/neglect comitted by master, crew etc.– Not his own fault, or the fault of senior management personnelNot his own fault, or the fault of senior management personnel (owner´s privity)(owner´s privity)– What if the shipowner and the master are the same person?What if the shipowner and the master are the same person?

• ND 1974.315ND 1974.315• Statement in preparatory work Statement in preparatory work

2525

Exemption for Exemption for navigational navigational errorserrors. What is included? . What is included? • Navigation of the vesselNavigation of the vessel

– Steering and manoeuvring, response to signals etc.Steering and manoeuvring, response to signals etc.• Management of the shipManagement of the ship

– The ship´s condition, manning and equipmentThe ship´s condition, manning and equipment

• Borderline casesBorderline cases– Was the act or omission primarily in the interest of Was the act or omission primarily in the interest of

the cargo or the ship?the cargo or the ship?– ND 1975.85 NSC Sunny LadyND 1975.85 NSC Sunny Lady

2626

Exemption for fire § 276, Para Exemption for fire § 276, Para 1 no.21 no.2

• What fires are included in the exemption? What fires are included in the exemption? – Fires caused by persons for whom the carrier is Fires caused by persons for whom the carrier is

responsibleresponsible• fires caused by negligent smoking by the crew (not liable)fires caused by negligent smoking by the crew (not liable)

– Not fires caused by owner own fault, or the fault of Not fires caused by owner own fault, or the fault of senior management personnel (owner´s privity) senior management personnel (owner´s privity) • Fires due to inadequate fire procedures (liable)Fires due to inadequate fire procedures (liable)

– What is a fire?What is a fire?• Open flameOpen flame• Smouldering? PossibleSmouldering? Possible

2727

Unseaworhtiness and the Unseaworhtiness and the exemptions in § 276 first para exemptions in § 276 first para no. (1) and no. (2)no. (1) and no. (2)• The exemptions do not apply when The exemptions do not apply when

the damage, loss or delay is the damage, loss or delay is connected with unseaworthiness. connected with unseaworthiness. – The ship being unseaworthy at the The ship being unseaworthy at the

commencement of the voyagecommencement of the voyage– The carrier, or someone for whom he is The carrier, or someone for whom he is

responsible, has not exercised due responsible, has not exercised due diligence to make the ship seaworthydiligence to make the ship seaworthy

2828

Seaworthiness Seaworthiness • What is seaworthiness?What is seaworthiness?

– Narrow sense; technical Narrow sense; technical • Must be able to perform the voyage without Must be able to perform the voyage without

endagering human lifeendagering human life– Broad sense; in relation to the cargo/ Broad sense; in relation to the cargo/

cargoworthyness cargoworthyness • The cargo can be expected to reach its destination The cargo can be expected to reach its destination

undamaged.undamaged.– The rule in MC § 276 second paragraph is only The rule in MC § 276 second paragraph is only

applicable to applicable to initial unseaworthinessinitial unseaworthiness– Gorgonzola & chocolateGorgonzola & chocolate

2929

Deck cargo and live animalsDeck cargo and live animals• Deck cargo, MC § 263Deck cargo, MC § 263

– Must be in accordance with a particular rightMust be in accordance with a particular right• Loss or damage; ordinary rules on liabilityLoss or damage; ordinary rules on liability

– Unlawful loading on deckUnlawful loading on deck• Special rules on liability in § 284, strict liability Special rules on liability in § 284, strict liability

– Loading on deck despite otherwise agreed: Loading on deck despite otherwise agreed: • unit limitation rules (§§ 280-283) can not be invoked § 284, unit limitation rules (§§ 280-283) can not be invoked § 284,

second paragraphsecond paragraph• Live animalsLive animals

– Liable under the ordinary rules (§275) Liable under the ordinary rules (§275) – Not liable for special risks associated with such carriage § Not liable for special risks associated with such carriage §

277277– (Nordiske Dommer 2000.393 smolt=live animals)(Nordiske Dommer 2000.393 smolt=live animals)

3030

Dangerous cargoDangerous cargo• Cargo, inherently dangerous Cargo, inherently dangerous

– Definition is difficultDefinition is difficult– More than everyday riskMore than everyday risk– Lists of dangerous cargoes issued by the Lists of dangerous cargoes issued by the

authorities authorities •Regulation of 29 July 2006 on carriage of Regulation of 29 July 2006 on carriage of

dangerous cargoesdangerous cargoes

3131

Duty of disclosureDuty of disclosure• The The sendersender has a duty of disclosure; § 257 has a duty of disclosure; § 257• The sender will be liable if the The sender will be liable if the shipper shipper

failes to mark the goods and inform the failes to mark the goods and inform the carriercarrier– The goods must be marked as dangerousThe goods must be marked as dangerous– Reasonable notice must be given to the carrierReasonable notice must be given to the carrier– All relevant information must be given (second All relevant information must be given (second

paragraph)paragraph)

3232

The carrier´s rights The carrier´s rights • The carrier´s rights when the sender has The carrier´s rights when the sender has

not fulfilled his duty to inform (§ 291): not fulfilled his duty to inform (§ 291): – May refuse to take dangerous goods on board May refuse to take dangerous goods on board – May discharge the goods or destroy them or May discharge the goods or destroy them or

render them innocuous (harmless)render them innocuous (harmless)• Not applicable when ”assumption of risk”; Not applicable when ”assumption of risk”;

§ 291 second paragraph§ 291 second paragraph• Special rule on saving life and property – Special rule on saving life and property –

no obligation to pay damages; § 291 third no obligation to pay damages; § 291 third paragraph paragraph

3333

Strict liability on the sender Strict liability on the sender • § 291 imposes strict liability on the sender§ 291 imposes strict liability on the sender

– When the cargo is delivered When the cargo is delivered • without information about without information about dangerous characteristicsdangerous characteristics

oror• Without information about Without information about necessary safety measuresnecessary safety measures

• Pre-condition: The carrier must not have Pre-condition: The carrier must not have had actual knowledge had actual knowledge

• § 291 covers both (and only) carrier and § 291 covers both (and only) carrier and sub-carriersub-carrier

3434

Liability for delay Liability for delay • The loss:The loss:

– The goods are damaged or destroyedThe goods are damaged or destroyed• Liability is regulated in § 275Liability is regulated in § 275

– The goods are ok, but market conditions have changed The goods are ok, but market conditions have changed (Christmas decoration in January)(Christmas decoration in January)• Liability is regulated in § 278Liability is regulated in § 278

• When is there a delay?When is there a delay?– Starting point: § 262 ”carried out with due despatch” (care)Starting point: § 262 ”carried out with due despatch” (care)– § 278.2 gives further guidelines:§ 278.2 gives further guidelines:

• Agreed deliveryAgreed delivery• Within the time which is reasonable to demand of a prudent Within the time which is reasonable to demand of a prudent

carrier in the circumstancescarrier in the circumstances• No delivery? 60 days – total lossNo delivery? 60 days – total loss

3535

DeviationDeviation• Traditionally; serious breach of contractTraditionally; serious breach of contract• Today; Today;

– has the carrier chosen a reasonable voyage plan, has the carrier chosen a reasonable voyage plan, and and

– is the cargo at destination within a reasonable time is the cargo at destination within a reasonable time • § 275, second paragraph: the carrier has a § 275, second paragraph: the carrier has a

right to take measures to save human life or right to take measures to save human life or reasonable measures to save ships or other reasonable measures to save ships or other property at sea. property at sea.

3636

The scope of liabilityThe scope of liability• The ordinary starting point (economic loss) does not The ordinary starting point (economic loss) does not

applyapply• Standarised loss rule in MC § 279Standarised loss rule in MC § 279

– Value of the goodsValue of the goods– Exchange price, market price or current value of same Exchange price, market price or current value of same

goodsgoods– Ex LF-2006-25784Ex LF-2006-25784

What about indirect or consequential damages?What about indirect or consequential damages?has been accepted in arbitration practice, but no has been accepted in arbitration practice, but no general rulegeneral rule

3737

The unit limitation rulesThe unit limitation rules• SDR – Special Drawing Rights, § 505SDR – Special Drawing Rights, § 505

• MC § 280 first paragraph:MC § 280 first paragraph:– 667 SDR for each lost or damaged unit or667 SDR for each lost or damaged unit or– 2 SDR per kilogram damaged or lost goods2 SDR per kilogram damaged or lost goods– Ex ND-2004-373Ex ND-2004-373

• What is a unit ? § 281; container, pallet or other transport deviceWhat is a unit ? § 281; container, pallet or other transport deviceThe text of the bill of lading is determinativeThe text of the bill of lading is determinative

• The limit of liability which results in the highest liability shall be appliedThe limit of liability which results in the highest liability shall be applied– NOTE!!The rules on liabiliy does not apply where the carrier himself caused NOTE!!The rules on liabiliy does not apply where the carrier himself caused

damage wilfully or through gross negligence, § 283damage wilfully or through gross negligence, § 283

• GGlobal limitation in MC Chapter 9, § 175 no 3 lobal limitation in MC Chapter 9, § 175 no 3 • Norwegian domestic trade; 17 SDR § 280 second sectionNorwegian domestic trade; 17 SDR § 280 second section

3838

Notice and period of Notice and period of limitationlimitation• Notice of damage or loss § 288, 1. paraNotice of damage or loss § 288, 1. para

– When the cargo is deliveredWhen the cargo is delivered– Imediately and writtenImediately and written (§ 288, 1.para, 1. sentence)(§ 288, 1.para, 1. sentence)– Or, if not apparent, three days after delivery (§ Or, if not apparent, three days after delivery (§

288, 1.para 2.sentence)288, 1.para 2.sentence)• Notice of loss in consequence of delayNotice of loss in consequence of delay

– 60 days § 288, 3. para60 days § 288, 3. para

• Period of limitation § 501 nr 7Period of limitation § 501 nr 7

3939

Introduction - the bill of ladingIntroduction - the bill of lading

• The functions of the bill of ladingThe functions of the bill of lading• Liability under the rules relating to Liability under the rules relating to

bills of ladingbills of lading– Delivery liability (distinct type of Delivery liability (distinct type of

liability, liability, §§ 302, 292)§§ 302, 292)

– Description liability (§ 300)Description liability (§ 300)– Misdescription (§299 third paragraph)Misdescription (§299 third paragraph)

4040

The underlying sale and the bill The underlying sale and the bill of ladingof lading• Distance saleDistance sale

– The goods and the payment cannot be The goods and the payment cannot be exchanged simultaneouslyexchanged simultaneously

– The buyer cannot inspect the goodsThe buyer cannot inspect the goods• The bill of lading provides a description of The bill of lading provides a description of

the goodsthe goods• The value of the description hinges to a The value of the description hinges to a

large extent on the legal rules associated large extent on the legal rules associated with it. with it.

4141

How to obtain delivery of How to obtain delivery of cargocargo• The receiver must be authorised §§ 292, The receiver must be authorised §§ 292,

1.paragraph no. 2, 303 and 3041.paragraph no. 2, 303 and 304• Who is authorised ?Who is authorised ?

– The reciver must physically possess the bill of lading, andThe reciver must physically possess the bill of lading, and– Be expressly stated in the bill of lading/consignee (§ 302 1. Be expressly stated in the bill of lading/consignee (§ 302 1.

ledd, first paragraph, first alternative) orledd, first paragraph, first alternative) or– A series of endorsements are leading to the person A series of endorsements are leading to the person

demanding delivery ( § 302 1. paragraph, second demanding delivery ( § 302 1. paragraph, second alternative) oralternative) or

– There is an endorsement There is an endorsement in blank /without naming the in blank /without naming the consigneeconsignee (§ 302 1. paragraph, third alternative) (§ 302 1. paragraph, third alternative)

• The carrier must act bona fides; if he knows that the The carrier must act bona fides; if he knows that the receiver is not authorised to demand delivery he receiver is not authorised to demand delivery he cannot deliver the goodscannot deliver the goods

4242

The bill of lading is a The bill of lading is a negotiable instrumentnegotiable instrument• The bill of lading is a key to receiving the The bill of lading is a key to receiving the

goods:goods:– The issuers defences cannot be invoked against The issuers defences cannot be invoked against

holders in good faith, MC § 292 third paragraphholders in good faith, MC § 292 third paragraph– The carrier will be free from liability if he delivers The carrier will be free from liability if he delivers

to the owner (§ 302)to the owner (§ 302)– The carrier can demand presentation as a pre-The carrier can demand presentation as a pre-

condition of delivery (§ 304)condition of delivery (§ 304)– A holder in good faith is protected against A holder in good faith is protected against

competing claimants (§ 306)competing claimants (§ 306)

4343

The content of a bill of The content of a bill of ladinglading

What is a bill of lading? MC § 292 requires What is a bill of lading? MC § 292 requires that the document contains:that the document contains:- evidence of an agreement of carriage by - evidence of an agreement of carriage by seasea- evidence that the sender has received or - evidence that the sender has received or loaded the cargo”loaded the cargo”

- the words ”bill of lading” or make it - the words ”bill of lading” or make it apparent that delivery will only take place apparent that delivery will only take place on presentation of the billon presentation of the bill

4444

The content of a bill of lading, The content of a bill of lading, cont.cont.

§ 296 first paragraph no. 1§ 296 first paragraph no. 1-the nature of the goods-the nature of the goods- their dangerous properties- their dangerous properties- the necessary identification marks- the necessary identification marks- the number of packages or pieces and- the number of packages or pieces and- the weight - the weight

All as stated by the shipperAll as stated by the shipper

§ 296 first paragraph no 2§ 296 first paragraph no 2- the apparent condition of the goods and packaging- the apparent condition of the goods and packaging

(in apparent good order and condition)(in apparent good order and condition)

§ 296 first paragraph no 3 - 13 § 296 first paragraph no 3 - 13

4545

§ 296 second and third § 296 second and third paragraphparagraph• Shipped billl of lading must contain:Shipped billl of lading must contain:

– Nationality and name of the shipNationality and name of the ship– Place of loading and the date when the loading Place of loading and the date when the loading

was completedwas completed• The bill of lading must be signedThe bill of lading must be signed

– By the carrier or someone on his behalfBy the carrier or someone on his behalf• The master, § 176; ”principal” (owner)/ § 295; ”carrier”The master, § 176; ”principal” (owner)/ § 295; ”carrier”

– By someone who has been given the authorityBy someone who has been given the authority• An agentAn agent

4646

What if some information is What if some information is missing?missing?• MC § 297; still a bill of lading if the MC § 297; still a bill of lading if the

conditions in § 292 is fulfilledconditions in § 292 is fulfilled

– Must be named bill of lading or Must be named bill of lading or – Indicate that the goods only will be Indicate that the goods only will be

delivered against presentation of the delivered against presentation of the documentdocument

4747

Carrier`s duty to check that Carrier`s duty to check that the information in the bill of the information in the bill of lading is correctlading is correct• § 298 first paragraph § 298 first paragraph

– The carrier shall to a reasonable extent check the The carrier shall to a reasonable extent check the accuracy of the information on the goods entered in accuracy of the information on the goods entered in a bill of ladinga bill of lading

• § 298 second paragraph; make a reservation§ 298 second paragraph; make a reservation– Resonable grounds for doubting orResonable grounds for doubting or– Not had resonable opportunity to checkNot had resonable opportunity to check

• § 299 third paragraph; notation§ 299 third paragraph; notation

– Must state expressly that the information is incorrectMust state expressly that the information is incorrect

4848

The carrier`s liability for The carrier`s liability for information in the bill of ladinginformation in the bill of lading• Designed to protect individuals who rely in good faith on Designed to protect individuals who rely in good faith on

the information in the bill of ladingthe information in the bill of lading

• How far should the protection extend?How far should the protection extend?– Is it enough that there is a gap between the information and Is it enough that there is a gap between the information and

the actual conditions of the goods?the actual conditions of the goods?– Or do we need some culpable conduct causing the information Or do we need some culpable conduct causing the information

to be misleading?to be misleading?– How should the damages be assessed in monetary terms?How should the damages be assessed in monetary terms?

• Expectation interest (put in the situation as if the goods matched Expectation interest (put in the situation as if the goods matched the description)the description)

• Reliance interest ( put in the situation as if he had been actually Reliance interest ( put in the situation as if he had been actually informed)informed)

• Solution: §§ 299 and 300 - different liability regimesSolution: §§ 299 and 300 - different liability regimes

4949

Implied transport liability, § Implied transport liability, § 299, third paragraph299, third paragraph

• Only relevant when a third party has Only relevant when a third party has acquired the bill of lading in good acquired the bill of lading in good faith relying on the accuracy of the faith relying on the accuracy of the statement in itstatement in it

• Then evidence on the contrary shall Then evidence on the contrary shall not be admissIblenot be admissIble

5050

Implied transport liability, Implied transport liability, cont. cont. • The third party must have paid the purchase price in The third party must have paid the purchase price in

exchange for the documentexchange for the document• Or it is used as a negotiable document in international tradeOr it is used as a negotiable document in international trade

– A bank has acquired the bill of lading in connection with it A bank has acquired the bill of lading in connection with it letter of credits obligationletter of credits obligation

– Or otherwise has extended credit using the bill of lading as Or otherwise has extended credit using the bill of lading as securitysecurity

• The bill of lading is conclusive evidence of the condition and The bill of lading is conclusive evidence of the condition and quantity of the goods at the commencement of carrigequantity of the goods at the commencement of carrige– Any difference between the description in the bill of lading and Any difference between the description in the bill of lading and

the conditions of the goods at delivery is treated as damage the conditions of the goods at delivery is treated as damage arising during transport arising during transport

5151

Implied transport liability, Implied transport liability, cont.cont.• The basis of liability is § 275; negligence The basis of liability is § 275; negligence

with a reversed burden of proofwith a reversed burden of proof– Exculpating evidence is not allowed (§ 299, 3 Exculpating evidence is not allowed (§ 299, 3

paragraph)paragraph)– The liability is unconditionallyThe liability is unconditionally

• QuantumQuantum– The ordinary rules on cargo damage applyThe ordinary rules on cargo damage apply

5252

Liability for incorrect Liability for incorrect description, description, § 300§ 300• Protects a third party who has aquired the Protects a third party who has aquired the

document relying on the accuracy of the document relying on the accuracy of the information providedinformation provided

• Basis for liability; § 300Basis for liability; § 300• ””the carrier understood or ought to have the carrier understood or ought to have

understood” – not strict liabilityunderstood” – not strict liability– That the information was objectively incorrectThat the information was objectively incorrect– That the information was likely to mislead a That the information was likely to mislead a

third partythird party

5353

The scope of the carriers The scope of the carriers liabilityliability• The holder of the bill of lading must The holder of the bill of lading must

receive compensation for losses receive compensation for losses suffered due to his reliance on the bill suffered due to his reliance on the bill of ladingof lading

• As if correct information was given As if correct information was given (reliance interest)(reliance interest)

• Not defined as ordinary carrier of Not defined as ordinary carrier of transport liabilitytransport liability– Thus the unit limitation does not applyThus the unit limitation does not apply

5454

Situations covered by both § Situations covered by both § 299 and § 300299 and § 300• The cargo owner can choose which The cargo owner can choose which

set of rules to applyset of rules to apply

5555

ShipperShipper`s liability to carrier`s liability to carrier

– The Shipper:The Shipper: – Provides information as described in § Provides information as described in §

296 paragraph 1 no. 1296 paragraph 1 no. 1– The Carrier will be held liable for this The Carrier will be held liable for this

information thus;information thus;– Strict liability for information provided Strict liability for information provided

by the shipper, § 301 paragraph no 1by the shipper, § 301 paragraph no 1

5656

FraudFraud• The shipper needs a clean bill of ladingThe shipper needs a clean bill of lading

– ””good order and condition” otherwisegood order and condition” otherwise– Difficulty to sell the goods – negotiating the bill of ladingDifficulty to sell the goods – negotiating the bill of lading

• Back letters/letter of indemnityBack letters/letter of indemnity• The back letters can not be invoked in a court of The back letters can not be invoked in a court of

law in the case of fraud, § 301, second paragraphlaw in the case of fraud, § 301, second paragraph– The cargo owner will have a claim both against the The cargo owner will have a claim both against the

carrier and the shippercarrier and the shipper– The cargo owner is entitled to be informed about The cargo owner is entitled to be informed about

possible back letters (§ 300) possible back letters (§ 300)

5757

Liability for wrongful Liability for wrongful deliverydelivery• The cargo should only be delivered against The cargo should only be delivered against

presentation of the bill of ladingpresentation of the bill of lading• What if an old customer provides a What if an old customer provides a

trustworthy explanation?trustworthy explanation?• And a bill of lading holder appears And a bill of lading holder appears

subsequently?subsequently?– The carrier will be subject to unlimited liability The carrier will be subject to unlimited liability

and his inSuranse will not help him.and his inSuranse will not help him.– Often he will recuire a guarantee from the Often he will recuire a guarantee from the

receiverreceiver– Other documentary solutions may be possible – Other documentary solutions may be possible –

sea way billsea way bill

5858

Sea waybills (§§ 308-309)Sea waybills (§§ 308-309)• Not negotiable documentsNot negotiable documents• The presentation of the original document The presentation of the original document

is not a pre-condition for delivery is not a pre-condition for delivery

• Evidence of a contract of carriageEvidence of a contract of carriage• Acknowledges that the goods have been Acknowledges that the goods have been

receivedreceived• Contains an undertaking by the carrier to Contains an undertaking by the carrier to

deliver the goods to the consignee deliver the goods to the consignee namednamed in the document in the document

5959

The content of a sea The content of a sea waybill,waybill,• Pre-conditions in § 309Pre-conditions in § 309

– Information about the goodsInformation about the goods– The name of the sender, consignee and the carrierThe name of the sender, consignee and the carrier– The terms of the carriageThe terms of the carriage– The freight and other expensesThe freight and other expenses

• According to the prearatory workAccording to the prearatory work– The place of shipment and deliveryThe place of shipment and delivery– Whether the goods can or shall be loaded on deckWhether the goods can or shall be loaded on deck

• Exceptions are acceptedExceptions are accepted• The sea waybill shall be signed (§ 309 and The sea waybill shall be signed (§ 309 and

the reference to § 296 third paragraph)the reference to § 296 third paragraph)

6060

The carrierThe carrier`s duty to inspect the `s duty to inspect the cargocargo• MC § 309, 1.paragraph, 2. sentence – MC § 309, 1.paragraph, 2. sentence –

see § 298see § 298• Regarding the information mentioned Regarding the information mentioned

in § 296 first paragraph no 1in § 296 first paragraph no 1• And information on the condition of And information on the condition of

the goods and the packingthe goods and the packing

6161

What are the consequences of What are the consequences of issuing a sea waybill?issuing a sea waybill?• The waybill must specify the consigneeThe waybill must specify the consignee

– The sender still may instruct the carrier to deliver to The sender still may instruct the carrier to deliver to another party another party

– But not when the consignee has asserted his right to the But not when the consignee has asserted his right to the goods (demanded delivery)goods (demanded delivery)

• It is evidence of the contract of carriage and of It is evidence of the contract of carriage and of receipt of the goods as describedreceipt of the goods as described– § 309 second paragraph§ 309 second paragraph

• The shipper may demand a bill of lading (§ 308 The shipper may demand a bill of lading (§ 308 third paragraph - § 294)third paragraph - § 294)– Not if the sender has waived his right to change Not if the sender has waived his right to change

consignee.consignee.

6262

Liability for wrongful Liability for wrongful deliverydelivery• Who appears entitled to the goods Who appears entitled to the goods

pursuant to the text of the sea waybillpursuant to the text of the sea waybill– Can be uncertainty as to the party`s identityCan be uncertainty as to the party`s identity

• Change of consignee Change of consignee – Oral or written notice must be given to the Oral or written notice must be given to the

carrier prior to the time limit in § 308 second carrier prior to the time limit in § 308 second paragraphparagraph

– In sufficient time for the carrier In sufficient time for the carrier

6363

When are sea waybills issued When are sea waybills issued and whom are they issued to?and whom are they issued to?• Custom of the trade decides choiCe Custom of the trade decides choiCe

of documentof document• The sender has the right to demand The sender has the right to demand

a sea waybill but must accept that a sea waybill but must accept that the shipper receives it directly from the shipper receives it directly from the carrierthe carrier