The aim of this book is to provide a convenient selection of cases and standard form documents for law students. It tries to provide a supplement rather than a substitute for lectures and textbooks. Katherine Reece Thomas has again very kindly undertaken the revision of Chapter 17, dealing with general average. As in earlier editions, judgments which consider the reason for a rule or which analyse previous case law have been preferred to those which do not. With regard to style, place names and the names and offices of judges are generally reproduced as originally reported and without note of subsequent changes. Matter omitted is generally indicated by ellipses, whatever the length of the omission. In reproducing cases and other materials, the following are not generally specifically noted: (a) omission of original footnotes; (b) original typographical errors, whether corrected or not; (c) the length and nature of omissions; (d) alterations or substitutions in the form of citations. Martin Dockray City University, London
CASES & MATERIALS ON THE CARRIAGE OF GOODS BY SEA Third Edition CASES & MATERIALS ON THE CARRIAGE OF GOODS BY SEA Third Edition Martin Dockray, LLB, PhD Professor of Law, City University, London with the assistance of Katherine Reece Thomas, BA, LLM, Solicitor Member of the New York State Bar Senior Lecturer in Law, City University, London Third edition first published in Great Britain 2004 by Cavendish Publishing Limited, The Glass House, Wharton Street, London WC1X 9PX, United Kingdom Telephone: + 44 (0)20 7278 8000 Facsimile: + 44 (0)20 7278 8080 Email: info@cavendishpublishing.com Website: www.cavendishpublishing.com Published in the United States by Cavendish Publishing c/o International Specialized Book Services, 5824 NE Hassalo Street, Portland, Oregon 97213-3644, USA Published in Australia by Cavendish Publishing (Australia) Pty Ltd 45 Beach Street, Coogee, NSW 2034, Australia Telephone: + 61 (2)9664 0909 Facsimile: + 61 (2)9664 5420 Email: info@cavendishpublishing.com.au Website: www.cavendishpublishing.com.au © Dockray, Martin Second edition Third edition 2004 1998 2004 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, without the prior permission in writing of Cavendish Publishing Limited, or as expressly permitted by law, or under the terms agreed with the appropriate reprographics rights organisation Enquiries concerning reproduction outside the scope of the above should be sent to the Rights Department, Cavendish Publishing Limited, at the address above You must not circulate this book in any other binding or cover and you must impose the same condition on any acquirer British Library Cataloguing in Publication Data Dockray, Martin Carriage of goods by sea – 3rd ed Maritime law – Great Britain I Title 343.4'1'096 Library of Congress Cataloguing in Publication Data Data available ISBN 1-85941-796-5 10 Printed and bound in Great Britain PREFACE The aim of this book is to provide a convenient selection of cases and standard form documents for law students It tries to provide a supplement rather than a substitute for lectures and textbooks Katherine Reece Thomas has again very kindly undertaken the revision of Chapter 17, dealing with general average As in earlier editions, judgments which consider the reason for a rule or which analyse previous case law have been preferred to those which not With regard to style, place names and the names and offices of judges are generally reproduced as originally reported and without note of subsequent changes Matter omitted is generally indicated by ellipses, whatever the length of the omission In reproducing cases and other materials, the following are not generally specifically noted: (a) omission of original footnotes; (b) original typographical errors, whether corrected or not; (c) the length and nature of omissions; (d) alterations or substitutions in the form of citations Martin Dockray City University, London ACKNOWLEDGMENTS The publishers and author wish to acknowledge with thanks the permissions given by the following to reprint material from the copyright sources listed below: Association of Ship Brokers and Agents (USA) Inc: NYPE 93 (New York Produce Exchange Form Time Charter) The Baltic and International Maritime Council (BIMCO): BALTIME 1939; BARECON 2001; GENCON 1994; MULTIDOC 95; MULTIWAYBILL 95; WORLDFOOD 99 BP Shipping Ltd: BPTIME3 Time Charter Comité Maritime International: York-Antwerp Rules Cornell Maritime Press: Kendall, L and Buckley, J, The Business of Shipping, 6th edn, 1994 The Incorporated Council of Law Reporting: Law Reports; Weekly Law Reports LexisNexis UK: All England Law Reports, Law Times Reports, Commercial Cases (reproduced by permission of Reed Elsevier (UK) Ltd trading as LexisNexis UK) Informa Professional Lloyd’s of London: Lloyd’s Law Reports P & O Nedlloyd Ltd: Bill of lading; Waybill The Simpler Trade Procedures Board: Standard Shipping Note; SITPRO Dangerous Goods Note; Common Short Form Bill of Lading; Sea Waybill United Nations: Bills of Lading, 1974, a report by the Secretariat of UNCTAD; Charter Parties 1974, a report by the Secretariat of UNCTAD Crown copyright material is reproduced with the permission of the Controller of HMSO and the Queen’s Printer for Scotland Parliamentary copyright material is reproduced with the permission of the Controller of HMSO on behalf of Parliament Every effort has been made to trace all the copyright holders but if any have been inadvertently overlooked the publishers will be pleased to make the necessary arrangement at the first opportunity Appendix 441 442 Cases & Materials on the Carriage of Goods by Sea Appendix N E M I C E P S 443 444 Cases & Materials on the Carriage of Goods by Sea WAYBILLS N E M I C E P S Appendix 445 446 Cases & Materials on the Carriage of Goods by Sea S E P M I C N E Appendix N E M I C E P S 447 INDEX Advance freight 281–83 ‘final sailing’ 282 ‘if required’ 282 ‘on signing bills of lading’ 282 Back freight 283–85 Bailment on terms 141–46 bailment and sub-bailment 142–43 contract, and 145–46 possession, and 145 relationship between owner and sub-bailee 143 terms of collateral bailment owner and sub-bailee 143–44 third parties, and 141–46 Bill of lading basic features 6–7 carrier entitled to deliver against production of one original bill 90–91 condition, evidence of 102–03 conditions in 83–87 contract, as 77–87 bill in hands of charterer 82–83 charterer 78–82 demise clauses 80 evidence of contract 77–78 identifying carrier 78–82 incorporation of charterparties 83–87 shipowner 78–82 terms 83–87 document of title, as 109–28 bailment, and 125–28 Carriage of Goods by Sea Act 1992 114, 115–18 See also Carriage of Goods by Sea Act 1992 claim in bailment and/or as reversionary owners 125–28 exhaustion of transferability 112–14 intention of parties 109–10 mercantile custom 109 nature of interest passed 110–11 ‘negotiable’ 111 ‘order or assigns’ 111–12 possession, right to 111 right to sue after extinction of shipper’s contractual rights 124–28 statutory transfer of rights of action 114–15 transfer of contractual rights 118–19 evidence in cargo claim, as 98–103 exemption clauses 93–95 forged, delivery against 92–93 Hague-Visby Rules, and See Hague-Visby Rules illegal indemnity agreements 96–98 incorporation clauses 83–87 freight 87 oral terms 87 staged approach 86 verbal manipulation 86–87 incorrectly claused 104–06 incorrectly dated 106–08 liability of agent to principal 108 non-production, reasonable excuse for 91–92 original, delivery against production of 89 quality, evidence of 101–02 receipt, as 89–108 exemption clauses 93–95 interpleader 91 Brandt contracts 146–48 Burden of proof seaworthiness, and 58–59 Cancellation clauses interpretation 208–13 Cargo 217–31 See also Loading alternative options 219–22 dangerous 228–30 duty to provide 217–18 full and complete 219 Cargo capacity importance of 198–201 Cargo claim bill of lading as evidence in 98–103 Cargoworthiness 47–48 examples 48 Carriage of Goods by Sea Act 1992 115–18 definitions 117–18 ‘demand’ 123 drafting of 120–23 liabilities under shipping documents 117 representations in bills of lading 117 rights under shipping documents 116 section 3(1) endorsement 123–24 450 Cases & Materials on the Carriage of Goods by Sea shipping documents to which Act applies 115 transmission of liabilities under 120–24 Carrier’s duty of care 33–34 Cesser clauses freight, and 287–89 Charter market 14–22 comparison of voyage and time charter costs 18–19 fixing voyage charter 19–21 marketplace 17–18 Chartered shipping 2–6 bareboat charters contracts of affreightment 2–3 contracts of carriage demise charters liner shipping compared 7–12 subchartering 5–6 time 3–6 voyage 3–6 Chartering process 14–22 bargaining position of parties 14 fixing time charter 21–22 standard forms 14–17 Charterparties 2–6 Charterparty incorporation in bill of lading 83–87 Class of vessel 197–98 Companies conduct barring limitation 350–53 Containerisation effect 12–13 Contract bill of lading as 77–87 See also Bill of lading Crew competence 48–50 Dangerous cargo 228–30 Deck cargo deviation, and 76 Delivery freight 271–75 Demurrage 233–70 See also Laytime deviation, and 75 effect of agreement to pay 262–63 length of time ship must remain on 266–68 once on demurrage, always on demurrage 263–66 ‘clear exceptions only’ rule 265 specified rate 261 UNCTAD Report 233 waiting time, in respect of 238–39 Despatch 268–70 agreements for payment 268–70 Deviation 63–76 deck cargo, and 76 delay, and 75 demurrage, and 75 duty not to deviate 63–76 origins 63–64 effect 71–76 Hague-Visby Rules See Hague-Visby Rules imminent peril, avoidance of 67–68 justifiable 66–67, 68 liberty to deviate clauses 68–70 main purpose of contract 69–70 port of call 69 proper route 64–65 rescission of contract, and 74 saving life 66–67 serious breach of contract, as 74 statutory limitation of liability, and 75–76 unseaworthiness, and 68 voluntary departure 65–66 Document of title bill of lading, as See Bill of lading Due diligence Hague-Visby Rules See Hague-Visby Rules Dunlop v Lambert, rule in 148–50 function of 150 Duty to carry with care 33–43 avoidance of consequences 35–36 burden of proof 37–38 exclusion of 36–37 fire, and 34–35 negligence 38–43 perils of the sea, and 34 tort, liability in 38–43 Estoppel by conduct loading, and 228 Expected ready to load interpretation of clause 205–06 Fire care, and 34–35 Fixed laytime 249–59 calculating 254–59 cargo loaded at average rate of [100] tons per working hatch 256–57 cargo to be discharged at average rate of 1000 metric tons basis five or more available workable hatches pro rata if less number of hatches per weather working day 257 Index cargo to be loaded at average rate of 120 metric tons per hatch per weather working day 257 cargo to be loaded at average rate of [100] tons per working hatch 256–57 charterers to have right to average days allowed for loading and discharging 257 completion of loading 258 concurrent charterparties 258–59 fault, meaning 250–51 ‘fault of the shipowner’ 250–51 general principles 249–50 holidays excepted 255 holidays worked 255 implication, by 259 loading and discharge time to be reversible 257–58 time lost through rain 255 use of waiting ship by owner 252–54 weather permitting 256 Flag implied obligation not to change 195–97 Freight 271–89 advance 281–83 back 283–85 cesser clauses 287–89 delivery 271–75 lump sum 275–79 pro rata 279–81 right to forward 279–81 shipper’s liability for 285–86 liens 286 Fuel consumption vessel, of 213–15 General average 355–77 background 355–56 causation 363–66 crucial questions 363–64 direct consequences 365–66 common safety 375–76 detention 375 fault 369–73 Jason clauses 369–73 meaning 355 ‘port charges’ 376 ‘port or place’ 376 relationship between ‘voyage’ and ‘common maritime adventure’ 374–77 temporary repairs 373–74 time to sue 366–68 unseaworthiness 369–73 who can sue 366–68 York-Antwerp Rules 1994 356–63 451 York-Antwerp Rules, Rule A 374–77 York-Antwerp Rules, Rule D 369–73 York-Antwerp Rules, Rule X 373–74 York-Antwerp Rules, Rule XI(B) 374–77 York-Antwerp Rules, Rule XIV 373–74 Hague-Visby Rules 151–92 Article I 159–66 bill of lading necessary but not sufficient to engage rules 164–65 carrier, meaning 159–60 contract of carriage 160 contract not in bill of lading 160–61 deck cargo 165–66 goods, meaning 165–66 no right to bill of lading 163–64 straight bill of lading 161–63 Article II 166–68 Article III Rule I: seaworthiness 168–78 due diligence 174–77 inescapable obligation 170–74 liability of carrier for acts of shippers 174–77 overriding obligation 168–70 ‘the voyage’ 177–78 Article III Rule II 178–80 ‘properly and carefully load’ 178–80 Article III Rule 6, time limit on suits 180–82 Article III Rule 182–85 liberty clauses 185 Article IV Rule 185–88 any other cause 188 burden of proof 188 fault in navigation or management of ship 185–87 Article IV Rule 188–92 deck cargo and deviation 191–92 background 151–52 Carriage of Goods by Sea Act 1971 152–59 absolute warranty of seaworthiness not to be implied 153 application of Hague Rules as amended 152–53 contracting states 153 conversion of special drawing rights into sterling 153 Hague Rules as amended 154–59 Himalaya clauses 134–41 Eurymedon principle 135–36 exclusive jurisdiction clause 136–38 Midlands Silicones case 134–35 shipowners as carrier 139–40 Hire 309–18 452 Cases & Materials on the Carriage of Goods by Sea deductions from 316–18 equitable set off 316–18 default 310 relief from forfeiture 313–15 time charters 309–18 waiver 310–12 Imminent peril deviation to avoid 67–68 Indemnity agreements illegal 96–98 Laytime 233–70 See also Demurrage arrival 234–42 charterer’s duty to facilitate 241 berth or no berth 240–41 berth reachable on arrival 240 duty to provide cargo 241 fixed, 249–59 See also Fixed laytime not fixed 259–61 order not to berth and load 241–42 port charter or berth charter 238 readiness 242–49 estoppel by convention 247–48 notice of 243–49 overstowed cargo 243 variation by agreement, and 245–46 waiver 246–47 whole of cargo 243 reasonable time 260–61 start of 234–49 time lost and overlapping charters 239–40 time lost to count if cargo inaccessible 239 time lost in waiting for berth to count as 239 UNCTAD Report 233 whether in berth or not 241 Liability of sea carriers 23–32 Act of God 24–25, 27–28 burden of proof 31–32 form of contract, and 31–32 carriage under special contract 28–31 barratry 31 contractual excepted perils 29–31 express contract 28 interpretation of exemption clauses 29 perils of the sea 29–30 pirates 30 restraint of princes, rulers, people 31 robbers 30 strikes 30 thieves 30 common carriers 23–25 inherent vice 25, 27–28 King’s enemies 25 lightermen 26–28 private carriers 25–28 public carriers 23–25 Liberty clauses Hague-Visby Rules, and 185 Lien freight, and 286 Limitation of liability 337–53 conduct barring 347–53 burden of proof 349 companies 350–53 knowledge 349 recklessness 349 risk 349 ‘such loss’ 349 history 337–38 Limitation Convention 1976 338 Merchant Shipping Act 1995 338–47 aggregation of claims 342–43 bar to other actions 344 claims excluded from limitation 345–46 claims exempted from limitation 340–41 claims subject to limitation 340, 345 conduct barring limitation 341 counterclaims 341 court, meaning 347 general limits 341–42, 346 governing law 344 limitation fund 343–44 limits of liability 341–43 passenger claims 342, 346 persons entitled to limit liability 339–40 right of limitation 339–41 right to limit liability 345 scope of application 344–45 ship, meaning 347 state party, meaning 347 Unit of Account 342, 346 Liner shipping 6–7 chartered shipping compared 7–12 containerisation 12–13 dock receipt 12 mate’s receipt 12 sea waybill 13 Shipping Note 13 tramp shipping compared 7–12 Loading 217–31 See also Cargo Index conduct of parties, and 222 estoppel by conduct, and 228 obligations 222–28 Lump sum freight 275–79 Mercantile custom transfer of bills of lading, and 109 Negligence duty to carry with care, and 38–43 Perils of the sea care, and 34 Pro rata freight 279–81 Proper route deviation, and 64–65 Readiness laytime, and See Laytime Reasonable despatch nature of obligation 203–04 Redelivery 331–36 disrepair, in 334–35 express or implied margin 331–32 legitimate final voyage 332–34 wrong place, at 335–36 Remedies seaworthiness, and 59–61 Repudiation of contract seaworthiness, and 59–61 Safe ports time charters, and 303–09 Seaworthiness 45–61 bad stowage 54–56 bunkering stages 53 burden of proof 58–59 cargoworthiness 47–48 See also Cargoworthiness causation 56–58 novus actus interveniens 57 crew, competence of 48–50 deviation, and 68 examples of defects rendering vessel unseaworthy 46 Hague-Visby Rules See Hague-Visby Rules implied warranty: origins 45–46 lack of necessary documents 50–52 modern doctrine 46–47 prudent owner test 46–47 remedies 59–61 repudiation of contract 59–61 stages, doctrine of 52–54 time at which warranty attaches 52–54 453 Ship 193–215 See also Vessel cargo capacity 198–201 flag 195–97 identity 193–95 particular items of description 195–201 Shipping industry features of 1–2 nature of 1–2 Speed vessel, of 213–15 Standard charterparty forms 14–17 development 14–15 general aspects 15–17 Standard forms use of 1–2 Statutory exclusion 337–53 See also Limitation of liability Storage seaworthiness, and See Seaworthiness Stowage See Loading Third parties 129–50 bailment on terms 141–46 See also Bailment on terms Brandt contracts See Brandt contracts Contracts (Rights of Third Parties) Act 1999 129–33 arbitration provisions 132–33 defences available to promisor 130–31 enforcement of contract by promisee 131 exceptions 131–32 Northern Ireland 133 protection of party promisor from double liability 131 rescission of contract 130 right of third party to enforce contractual term 129 supplementary provisions 132 variation of contract 130 Himalaya clauses See Himalaya clauses Time charters 291–336 charterer’s right to give orders 292–98 legitimate instructions 292–95 time for compliance 295–98 costs 18–19 fixing 21–22 hire 309–18 See also Hire legitimate final voyage 332–34 off-hire 318–31 454 Cases & Materials on the Carriage of Goods by Sea external causes 324–31 inefficiency 324–31 loss of time 321 partial inefficiency 321–24 redelivery 331–36 See also Redelivery safe port 303–09 shipowner’s right to indemnity 298–303 compliance with obviously impermissible orders 303 fault, and 300 implied indemnity 300 order to deliver cargo without production of bill of lading 303 risks accepted by shipowner 300–01 unbroken chain of causation, need for 301–03 terminology 291–92 withdrawal 309–18 any other breach 315–16 Time limit on suits Hague-Visby Rules See Hague-Visby Rules Time for performance 201–13 cancellation clauses 208–13 combined effect of reasonable despatch and ‘expected ready to load’ undertakings 206–08 expected ready to load 205–06 fixed date obligations 201–03 reasonable dispatch 203–04 Tort, liability in duty to carry with care, and 38–43 Tramp shipping 7–12 Dunlop v Lambert, rule in 148–50 See also Dunlop v Lambert, rule in liner shipping compared 7–12 Unseaworthiness See Seaworthiness Vessel 193–215 See also Ship class 197–98 fuel consumption 213–15 speed 213–15 time for performance 201–13 See also Time for performance Voyage charter costs 18–19 fixing 19–21 York-Antwerp Rules 1994 356–63 general average 356–63 key changes 362 relationship between Rule XI(b) and Rule A 363 Rule Paramount 362