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Carriage of Goods by Sea – from Hague to Rotterdam: Safer Waters

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Carriage of Goods by Sea – from Hague to Rotterdam: Safer Waters View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by South East Academic Libraries System (SEALS) CARRIAGE OF GOODS BY SEA – FROM HAGUE TO ROTTERDAM: SAFER WATERS By DENNING N. METUGE Submitted in fulfilment of the requirements for the award of the degree of MAGISTER LEGUM (MERCANTILE LAW RESEARCH) In the Faculty of Law at the NELSON MANDELA METROPOLITAN UNIVERSITY Supervisor: Mr SP NEWMAN January 2012 i DECLARATION I, Metuge Denning Ngomele, student number S210113375, In accordance with Rule G4.6.3, hereby declare that CARRIAGE OF GOODS BY SEA – FROM HAGUE TO ROTTERDAM: SAFER WATERS is my own work and that it has not previously been submitted for assessment or completion of any postgraduate qualification to another University or for another qualification. METUGE DENNING NGOMELE ii ACKNOWLEDGEMENTS I am very grateful to my promoter Mr Stephen Peter Newman for his efforts in supervising this research. I also wish to express my sincere gratitude to Professor Patrick HG Vrancken for his assistance with the structural development of this research despite his busy schedule. Also I wish to say special thank you to Miss Dawn Prinsloo, you are amazing at your job, thank you for assistance with retrieving relevant articles for my research. To my family, I have no words to express how grateful I am to have you. Your trust love and prayers kept me going when I thought I couldn’t. I love you all so much. To my friends whom I hold close to my heart, having you during this period made me a better person. In this light, I say thank you to Nnane Roland, Felix Nzante, Gilbert, Akale Namondo, Harold Rupapa, and all those whom I haven’t mentioned, thank you for being there for me. Above all, I wish to say thank you Lord Jesus, for it is by your Grace that I made it this far in life. Thank you for the wonderful people you have brought into my life. iii SUMMARY The back bone of international trade has always been international transport. Without good transport networks, the movement of goods and services from one frontier to another would be an uphill task, and would greatly hinder development in international trade. The impact of such poor transport networks would reflect negatively on economies that rely on international trade for the growth of their nations. Nevertheless, perfect transport networks would be useless if the performance of the business of carriage was not regulated by a law developed to meet the standards established by time, and that would regulate the relationship of the parties under contracts of carriage, mainly the carrier, consignor and consignee, so as to ensure certainty and equality in the allocation of risks between the parties thereunder. This research focuses on the carriage of goods by sea. Like most other modes of transport, one of the major issues that arises in the business of carriage of goods by sea is the conflict between the carrier, consignor and consignee, with regards to the allocation of risk in the carriage. Over the years, early rules that were developed to regulate the relationship of the parties under contracts of carriage of goods by sea placed the carrier in a dominant position over the consignor. The carrier issued a standard bill of lading which exempted him from almost all liability for damage or loss of the goods in his care. The consignors and bona fide third parties, not satisfied with the terms of carriage contracts brought a lot of pressure to bear on their governments to enact legislation protecting their interests in the transaction. The United States of America were the first to pass such national law revising the position of the parties under contracts of carriage. In 1893 the United States of America passed the Harter Act. This Act aimed at imposing limits of liability on the carrier to which no derogation could be brought. However, this was a dangerous precedence which was going to hinder international trade rather than improve on it, as different nations developing local legislation on carriage meant conflict of laws. In order to avoid the extensive nationalisation of carriage laws, the international maritime community set to develop rules that would regulate carriage by sea. Over the years convention has succeeded convention such that today four international regimes (The Hague Rules, Hague-Visby Rules, Hamburg Rules and Rotterdam Rules), exist regulating carriage of goods by sea. This research takes an in-depth look at these regimes that were developed to regulate carriage by sea, and the author aims to identify a particular regime that meets the standards of modern day practice of carriage of goods, and advocate for the ratification of this regime, to the exclusion of all others so as to foster uniformity, certainty and equality in the business of carriage of goods by sea. iv TABLE OF CONTENT DECLARATION……………………………………………………………………………………………………………….…….ii ACKNOWLEDGMENTS…………………………………………………………………………………………………….…………….iii SUMMARY................................................................................................................................iv CHAPTER ONE: INTRODUCTION ............................................................................................ 1 1.1 BACKGROUND ................................................................................................................ 1 1.2 DEFINITION OF THE PROBLEM ....................................................................................... 4 1.3 RESEARCH QUESTION .................................................................................................... 7 1.4 AIM AND OBJECTIVES .................................................................................................... 7 1.5 RESEARCH METHODOLOGY ........................................................................................... 8 1.6 CONTRACTS OF SALE AND THE INCIDENCE OF CARRIER LIABILITY UNDER CONTRACTS OF CARRIAGE BY SEA ................................................................................. 9 1.6.1 NATURE OF THE CONTRACT OF SALE ............................................................................ 9 1.6.2 C.I.F CONTRACTS .......................................................................................................... 10 1.6.3 F.O.B CONTRACTS ........................................................................................................ 11 1.6.4 TYPES OF CARRIAGE CONTRACTS ................................................................................ 12 1.6.5 WHY INTERNATIONAL REGULATION? .......................................................................... 14 1.7 THE BILL OF LADING AND PERFORMANCE OF THE CONTRACT OF CARRIAGE ............ 15 1.7.1 BILL OF LADING AS RECEIPTS ....................................................................................... 16 1.7.2 THE BILL OF LADING AS EVIDENCE OF THE CONTRACT OF CARRIAGE ........................ 17 1.7.3 THE BILL OF LADING AS DOCUMENT OF TITLE ............................................................ 17 1.7.4 PERFORMANCE OF THE CONTRACT OF CARRIAGE ...................................................... 18 1.8 FREIGHT .................................................................................................................... 21 CHAPTER TWO: CARRIERS’ LIABILITY UNDER ENGLISH COMMON LAW ............................ 23 2.1 INTRODUCTION ............................................................................................................ 23 2.2 DUTIES OF THE CARRIER AT COMMON LAW ............................................................... 24 2.2.1 DUTY TO PROVIDE A SEA-WORTHY SHIP ..................................................................... 24 2.2.2 DUTY TO PROCEED WITH DUE DISPATCH .................................................................... 27 v 2.2.3 DUTY NOT TO DEVIATE ................................................................................................ 27 2.2.4 DUTY TO TAKE REASONABLE CARE OF THE GOODS .................................................... 29 2.2.5 DUTY TO DELIVER GOODS TO A NAMED OR IDENTIFIABLE PERSON ........................... 29 2.3 COMMON LAW EXCEPTIONS FROM LIABILITY ............................................................ 31 2.3.1 ACTS OF GOD ............................................................................................................... 31 2.3.2 ACT OF THE QUEEN’S ENEMIES ................................................................................... 31 2.3.3 INHERENT VICE ............................................................................................................. 31 2.3.4 FAULT OR FRAUD OF CONSIGNOR ............................................................................... 32 2.4 LIMITATION OF CARRIER LIABILITY AT COMMON LAW ............................................... 32 2.4.1 PERILS OF THE SEA ....................................................................................................... 32 2.4.2 ARREST OR RESTRAINT OF PRINCES............................................................................. 33 2.4.3 STRIKES .................................................................................................................... 34 2.4.4 FIRE .................................................................................................................... 35 2.4.5 NEGLIGENCE AND NAVIGATIONAL ERRORS ................................................................ 35 2.5 CONCLUSION ...............................................................................................................
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