Transport & Logistics News - March 2017: part 3

Vinnlustodin HF and Anor v Sea Tank Shipping AS (The "Aqasia") [2016] EWHC 2514 (Comm.)

This case was concerned with a claim for US$367,836 for damage suffered to a cargo of 2,000 tonnes of fish oil shipped in bulk for a lump sum freight. The carrier admitted liability but sought to limit its liability to £54,730.90 calculated with reference to the limitation of liability under Article IV Rule 5 of the Hague Rules of 100 pounds per metric tonne of cargo damaged.

It was held by Sir Jeremy Cooke in the High Court in England that the word "unit" in Article IV Rule 5 referred to a physical unit for shipment and did not mean a unit of measurement or customary freight unit. Furthermore, he held that even if "unit" was capable of applying to bulk cargoes it could only apply to a "freight unit", and because the cargo was shipped for a lump sum there was no assistance to be gained by the carrier from such an interpretation.

In reaching his conclusion, Cooke J followed the decision reached by Allsop J (as he then was) in the Federal Court of Australia in the case of El Greco (Australia) Pty Ltd v Mediterranean Shipping Co SA (2004) 2 Lloyds Rep 537.

Kairos Shipping Limited and Anor v Enka AA and Co LLC & Ors (The "Atlantik Confidence") [2016] 2 Lloyds Rep 525

This case concerned a challenge to an owner's right to limit its liability under the Limitation for Liability for Maritime Claims Convention 1976, which was successful.

The vessel "Atlantik Confidence" sustained a fire in her engine room and sank a few days later after the crew had abandoned the ship. The owners sought a limitation decree but the subrogated insurers of the cargo contended that the owners were barred from claiming limitation by reason of their personal act or omission committed with intent to cause such loss under Article 4 of the Convention.

The High Court of England (Teare J) held that the cargo interests had met the high burden...