Course HANDOUTScarriage of goods by seaFaculty of Law - English Section Prepared by Dr. Yassin EL SHAZLY PhD in Law, Lyon Law School, France Teacher, Business Law Department, Faculty of Law, Ain Shams University, Cairo, Egypt 1
1- Main idea of the chapterThe chapter discusses the main trade terms used intransportation contracts and the legal aspects of thevarious means of transportation and the legalcommitments and responsibilities of the sellers andbuyers and carriers of goods.
Lack of uniformityUNIFORMITY OF INTERNATIONAL PRIVATE MARITIME LAW Origins Sources of Introduction maritime law Alternative to Pro uniformity international conventions Cons uniformity
The New Definitions ofInternational Maritime Law Based on the above definitions, I propose the following new definitions of international maritime law: "International Public Maritime Law" (or "Public International Maritime Law") concerns the legal relationship between States in respect of maritime matters. "Private International Maritime Law" (or "Conflict of Maritime Laws") is the collection of rules used to resolve maritime disputes as to choice of law, choice of jurisdiction and recognition of foreign judgments between private parties subject to the laws of different States. "International Private Maritime Law" concerns the legal maritime relationships between private parties of different States.
The Lack of Uniformity in InternationalPrivate Maritime Law Conventions There are many excellent international private maritime law conventions, which have been brought into existence by the CMI, UNCITRAL, UNCTAD AND IMO, as can be seen from Appendix "A", but many conventions are not in force or are only in force for a few major shipping and trading nations.
Appendix "B". The lack of uniformity due to the lack of adoption of major international maritime law conventions can be seen from Appendix "B". The document sets out the international maritime law in respect of twelve major sectors - carriage of goods, collision, pollution etc. - and compares the adoption of those conventions by five representative shipping nations the United Kingdom (common law), Canada (common law), France and China (civil law origins but recent common law assimilations), and the United States (common law with civil law origins).
The lack of uniformity in respect of international maritime law is disheartening for those who believe in uniformity, particularl y in comparison with air law, which started far behind but has now gone far ahead of maritime law.
Sources of maritime law a) international conventions and treaties b) international model laws c) standard form contracts d) standard terms e) international custom f) the lex maritima, being part of the lex mercatoria g) doctrine - writings of leading authorities on the law h) decisions of international courts and international arbitral tribunals i) decisions of national supreme and other courts and arbitral tribunals of international reputation.
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 1) Maritime law, from its very beginnings has been international law rather than national law and was declared to not be a part of Roman law, which was land law. 2) A lex maritima, a part of the general, customary mercantile law, or lex mercatoria, of the Middle Ages, has evolved over the centuries. This rich and ancient legal heritage has become the lex maritima, and is the source of our modern "general maritime law". In consequence maritime law in Western society has a common international origin - the civil law traditio
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 3) Ships, seamen, passengers, merchants and cargo of all nations are subject to the same seas, the same weather, the same climate, the same natural elements, the same perils, and the same ocean routes. Thus many maritime law disputes arise in similar contexts and circumstances. 4) Most national maritime law crosses international borders. In other words, national maritime law is usually international law in its application. 5) Ships are international because they easily change nationality; in fact, flags of convenience,
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 6) Ships, shipowners, charterers, crews and passengers, although citizens of different states, are often involved together in the same international voyage or common venture. 7) Shipping is international, because ships and crews have a common international science and language, so that crewmembers and at times whole crews are quite interchangeable.
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 8) The various trades and professions involved in the shipping industry have international organizations to defend and promote their respective interests. 9) Merchants have a common international language and terminology (e.g. the Incoterms CIF, FOB, etc.) which lends itself to "internationality". 10) Maritime law today includes a host of international conventions and model laws to which many States are party and which therefore apply to ships of different flags and to shipowners, charterers, shippers and consignees of different nationalities, domiciles and residences.
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 11) Shipbuilding, ship sales, carriage of goods and ship chartering are increasingly effected using standard-form contracts with legal terms understood internationally, including bill of lading and charterparty forms. 12) Marine insurance forms, policies and terms, (hull, cargo and P. & I., as well as reinsurance), apply internationally, to ships of many different flags and cargoes, having many different origins and owners. The Marine Insurance Act, 1906 of the United Kingdom is the mother of most national marine insurance act and is frequently a guide to marine insurance law in the United States, which has no federal marine insurance act.
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw 13) The jurisdiction of admiralty courts around the world tends to cover the same types of maritime disputes, and is often expressed in similar legal terminology. 14) Admiralty procedures are similar throughout the world. For example, maritime pre-judgment security procedures apply to all ships, regardless of nationality
The Particular InternationalOrigins, Sources and Nature of MaritimeLaw maritime attachment. 15) Maritime legal disputes arising anywhere in the world are increasingly decided by "alternative dispute resolution" mechanisms (particularly arbitration, but also conciliation and mediation). The disputes are often entrusted to international arbitral institutions (e.g. the Society of Maritime Arbitrators, the American Arbitration Association, the London Maritime Arbitration Association, the Chambre Arbitrale Maritime de Paris, the International Chamber of Commerce). A significant body of international "arbitral jurisprudence", part of the modern lex maritima/mercatoria, is developing, especially within these institutions, and is being applied by maritime arbitrators internationally.
Uniformity versus international origin National Plurality of lawn institutions preference Disparity of conventions
Useful Alternatives to International PrivateMaritime Law Conventions Model Rules Maritime Law Conventions Useful Alternatives to Standard forms Standard terms National statutes of international stature International judicial cooperation the "Maxwell order" Lex mercatoria-lex maritima
The pro and Cons of Uniform International Private Laws1. Certainty and 1. Offences to predictability of fundamental result principles of national2. Ease in the public order/policy determination and 2. Offences to application of the law fundamental national to be applied principles of justice3. Fairness and social order4. Order 3. Unnecessary international laws5. Economic development 4. Civil law/common law styles of drafting6. Procedural and terminology effectiveness 5. Loss of cultural diversity
What Divides Us1. Different systems of justice distributive v. corrective justice2. Different political and social objectives3. Different political systems4. Different standards because of differences in national wealth5. Transnational interests, shipowners, cargo insurers, P&I Clubs, freight forwarders6. The refusal of some states to give up their legislative sovereignty or authority over some maritime matters7. The indifference of some governments towards international uniformity of maritime law and even to maritime law, because of their preoccupation with national matters and in the international field, with International Public Law8. Lack of vision and courage
A Useful Solution to Lack of Uniformity of International Law:An innovation: the "tacit Uniform Conflict acceptance of Law Rules procedure"
"Tacit vs. express Acceptance Procedure" of IMO The response of the IMO was A major defect of most creative. It devised a "tacit international conventions is acceptance procedure", under that they can only be brought which an amendment to a up to date with great difficulty. given convention or protocol In effect, each protocol to a would automatically come into convention must be force on a specified date, renegotiated and readopted unless a certain percentage of by the traditional diplomatic Contracting States objected procedure known as the by another specified date. This "express acceptance procedure in fact reversed the procedure". traditional "express for example, in order to come acceptance procedure". It into force, typically require the meant that technical support of a fixed number of amendments to IMO contracting States and conventions on crucial matters sometimes also require such as maritime safety could support by States having a enter into force after only two specific percentage of the or three years, rather than five worlds tonnage. or ten, as would have been the case under the traditional express acceptance procedure.
Conclusion"Often in Error, Never in Doubt") International uniformity Effectiveness through Alternatives executive authority tacitacceptance Leadershipprocedure Courage Objectivity
Carriage of goods by sea :Most goods are transported by a common carrier holding itself to carrygoods for more than one party , only few shipments are large and has tobe delivered by one vessel ( Charterparty ).Common carrier :A ship that carries goods for all the persons who choose to employ it aslong as there is room.
There are three sorts of carriers : 1-Conference line : An association of seagoing common carriers operating on established routes that have joined. together to offer common freight rates. 2-Independent carrier : they have their own rate schedule. 3-Tramp vessels : they have there own rate schedule but they do not operate on established schedules
Bill of lading :An instrument issued by an ocean carrier to a shipperthat serves as a receipt for goods shipped , asevidence of the contract of carriage , and as adocument of title for the goods that is the personrightfully in possession of the bill is entitled to possess, use and dispose of the goods that the bill represents (governed by the convention called hague rules )
Bill of lading : Bill Of Lading Clean bill Claused bill of lading of lading
Bill Of LadingClean bill of lading :A bill of lading indicating that the goods have been properly on board thecarrier’s ship ( carriers clerk will check the labels and the goods are notdamaged an comply with the goods list then sign the bill and return it to theshipper ) .Claused bill of lading :A bill of lading indicating that some discrepancy exists between the goodsloaded and the goods listed on the bill.Note : However they are unacceptable to a third party including thebuyers of the goods under CIF contract or a bank that agreed to paythe seller under a documentary credit on receipt of the bill of lading. Itonly server as a prima facie evidence that the goods were received inthe condition shown in any dispute between the carrier and the shipper.
Bill of Lading Format :
Case 11 – 3 Court of appeal , Civildivision ( England ). ( A ) Golodetz & co.inc is the plaintiff VS ( B ) Czarnikow – ridna .co.inc (defendant ) .Case Summary:The sellers ( A ) contracted to sell the buyers ( B ) about 13000 tons of sugar, thecontract was made on clean on board bills. After loading a fire destroyed 200 tons ,the remainder was loaded and carried to the destination. The case here who is tostand the loss of 200 tons. The court decision was based on whether the bill oflading was clean or claused and also the contract stated ( loaded on the ship ) .Since the bill of lading noted no problems when the goods were shipped , thedocument was therefore clean under applicable law , Therefore the buyer has topay for the 200 tons destroyed.
Straight Bill of Lading :This gives the transferee no grater rights than those of histransferor Carrier Shipper Consignee
Order Bill of LadingThe holder of an order bill of lading has a claim to tittle anddelivery of goods Carrier Shipper Consignee
Carrier Duties under a bill ofLading Making the ship seaworthy Manning , equipping & supplying the ship Loading , handling , keeping & discharging the goods Making the wholes , cool chambers for safe reception carriage and preservation of the goods
Carriers Immunities Fire , unless cause by the actual fault Perils and dangers of the sea Act of Public enemies Quarantine restrictions Riots and civil commotions Insufficiency of packing Insufficiency or inadequacy of marks Act of war Act of war Act of war
Case 11 – 4 High court of Australia. ( A ) Great China metal industry is the plaintiff VS ( B ) Malaysian Internationalshipping ( defendant ) .Case Summary: (B) the carrier for the goods , , adverse weather conditions were forecast beforethe ship departed. On its way to the destination , the ship encountered bad theweather conditions and it cause a damage for part of the goods . (A) filed a suit against the carrier for negligence as it was aware of these weatherconditions.The court noted that their were various interpretations for the phrase “perils of thesea” .In conclusion the court ruled that there was no negligence of the part of the carrierand the goods had been properly loaded and stowed , and the damaged caused bythe bad weather was one of the perils of the sea .
Liability limits The Hague Visby rules set monetary limits on the liability incase of loss or damage of a cargo .This limits do not apply if :a- the parties agree to a higher amountsb- the carrier acted with the intend to cause damagec- the carrier acted recklessly knowing that damage wouldresult Time limitations A claim for loss or damages must be institutive within one year after the goods were delivered where the claim may be initiated by filing suit or starting arbitration proceeding
Himalaya ClauseThe Hague and Hague Visby rules applyonly to the carrier and the party shippinggoods under a bill of lading. Third partieswho help in the transport of the goods butwho are not parties to the carriage ofgoods contract contained in the bill oflading have no contractual right to claimthe liability limits established in theconventions.
6 - Charterparties Charterparty : A contract to hire an entire ship for a particular voyage or for a particular period of time Voyage Charter party : A contract to hire an entire ship for a particular voyage Lay days : The number Demurrage : A chargeDead freight : A charge of days that a charterer made by a ship ownerimposed on a charterer may keep a chartered when a charterer keeps awhen chartered ship has ship idle for loading ship idle more than theless than full load goods agreed number of lay days
Time charter party : A contract to hire an entire ship for a particular period of time. 7- Maritime liensA lien is a charge or claim against property that existsto satisfy some debt or obligation . A maritime lien is acharge or claim against a vessel , its freight or itscargo . The main purpose of maritime liens is to insurethat a vessel can adequately obtain credit to properlyoutfit itself for a voyage.Res : the vessel or cargo to which a maritime lienattaches.