The MV Sea Joy Owners of the Cargo Lately Laden on Board; The MV Sea Joy v The MV Sea Joy

• Jurisdiction: South Africa

The MV Sea Joy Owners of the Cargo Lately Laden on Board;
The MV Sea Joy v The MV Sea Joy
1998 (1) SA 487 (C)

1998 (1) SA p487

Citation	1998 (1) SA 487 (C)
Case No	AC 106/92
Court	Cape Provincial Division
Judge	Thring J
Heard	April 22, 1997; April 23, 1997; April 24, 1997
Judgment	August 7, 1997
Counsel	M Wragge for the plaintiff; PJ Berthold for the defendant

Flynote : Sleutelwoorde

Shipping — Carriage of goods by sea — Damage to cargo owing to improper stowage — Shipper's claim for damages founded on F art III rule 2 of Hague-Visby Rules (Schedule to Carriage of Goods by Sea Act 1 of 1986) in terms of which carrier obliged to 'properly and carefully load, handle, G stow, carry . . . and discharge' goods carried — Carrier denying liability on grounds that terms of carriage on bill of lading under heading 'freight details, charges, etc' stated to be 'FIOS' ('free in and out stowed'), thus relieving it of its obligations in terms of art III rule 2 — 'FIOS' term relieving H carrier of obligation to arrange for loading, stowage and discharge of cargo — Agreement that shipper to arrange for loading, stowage and discharge of its cargo not by itself sufficient to relieve carrier of obligations under art III rule 2 — Something more required — Carrier, through master, being responsible for safety ship and crew and for care of cargo, having overriding obligation to supervise stowage — Where bill of lading silent on who was to load or stow cargo, or who was to I be liable for bad loading or stowing, 'FIOS' inscription not relieving carrier of overriding obligation — Carrier liable for damages.

Interest — On unliquidated claim for damages — Section 2A of Prescribed Rate of Interest Act 55 of 1975 introduced on 5 April 1997 — Date from which interest to run — Plaintiff's summons served on 8 September 1992, but damages set out 'in such manner as will enable the defendant reasonably J

1998 (1) SA p488

to assess the quantum thereof' (Rule 18(10) of Uniform Rules of Court) in particulars of claim on A 27 August 1993 — Prior to 5 April 1997 interest on unliquidated damages not normally awarded until liquidated by agreement or by judgment — Quantum agreed to on 24 April 1997 — Court awarding interest from 27 August 1993.

Interest — On unliquidated claim for damages — Section 2A of Prescribed Rate of Interest Act 55 of B 1975 introduced on 5 April 1997 — Rate of interest — Court having discretion as to 'rate at which interest shall accrue' — Where prescribed rate at date from which interest awarded fixed at 18,5%, but dropping to 15,5% one month later and remaining unchanged thereafter, Court awarding interest at 15,5%.

Headnote : Kopnota

The plaintiff sought damages in an admiralty action in rem arising out of the damage to a cargo C of 'supawood' and particle board which it had shipped aboard the defendant vessel for carriage under a liner bill of lading. The cargo had shifted and collapsed because of improper D stowage. Its claim was founded on art III rule 2 of the Hague-Visby Rules (the Schedule to the Carriage of Goods by Sea Act 1 of 1986), which provides that '(s)ubject to the provisions of art IV, the carrier shall properly and carefully load, handle, stow, carry, keep, care for and discharge the goods carried'. Clause 8 of the bill of lading provided that '(l)oading, discharging and delivery of the cargo shall be arranged by the carrier's agent unless otherwise agreed'. E Although the vessel had been under charter at the time, clause 17 of the bill of lading defined the carrier as the vessel's owner. There was thus no contractual nexus between the plaintiff and the charterer.

The defendant pleaded that, because the terms of the shipment had been expressly stated on the bill of lading in a box headed 'Freight details, charges etc' to be 'FIOS' (free in and out stowed), no obligation had rested upon it or its owners in respect of the loading, stowage or F discharge of the cargo. It also relied upon art IV rule 2(i) and (q) for its contention that the damage to the cargo had occurred as a direct result of an act or omission (the incorrect stowage of the cargo) by the plaintiff, its agent or its representative; alternatively and in any event, without the fault or privity of the defendant or the fault or neglect of its agents or servants.

It was common cause that all the cargo, including the plaintiff's cargo, had been loaded and G stowed at Durban by a firm of stevedores engaged by the charterer's agent. This had been done both as a matter of convenience and in compliance with the terms of the time charterparty between the defendant's owner and the charterer, which in clause 8 provided that 'the charterers are to load, stow, trim and discharge the cargo at their expense under the supervision of the captain'.

The plaintiff had, in fact, instructed another firm of stevedores to load its cargo but, owing to H an administrative breakdown, those instructions had been overlooked and those stevedores had had nothing to do with the loading of the plaintiff's cargo. In his evidence the captain of the vessel acknowledged that he had played an active role in supervising the stowage of the I plaintiff's cargo. He and the charterer's surveyor had been dissatisfied with the manner in which the plaintiff's cargo had been loaded and had insisted that certain additional measures be taken to secure the cargo. He had not been satisfied with the additional measures either because his dissatisfaction stemmed, not from the securing of the cargo, but from the very way in which the load had been arranged. He nevertheless had put to sea. He admitted that if he had not been satisfied with the way in which the cargo had been lashed, he could have insisted that loading not take place. He J

1998 (1) SA p489

stated, too, that if in his opinion the stowage of the cargo constituted a danger to the vessel or A the crew, he would have had the power to refuse to sail.

It was common cause that the inscription 'FIOS' on the bill of lading relieved the carrier of the obligation which would otherwise have rested upon it of arranging and paying for the loading, B stowage and discharge of the cargo. The issue was whether or not, in addition, the carrier was also thereby relieved of liability for any failure to 'properly and carefully load, handle, stow . . . and discharge the goods carried' which it would normally bear in terms of art III rule 2. It was argued for the defendant that it had been open to the parties to contract on the basis that the carrier would be relieved of such liability and that they had so contracted, whereas the plaintiff contended that any attempt by the carrier so to contract would be hit by the prohibition C in art III rule 8. That rule provides that '(a)ny clause . . . in a contract of carriage relieving the carrier or the ship from liability for loss or damage to . . . goods arising from negligence, fault, or failure in the duties and obligations provided in this article . . . otherwise than as provided in these Rules, shall be null and void and of no effect'.

Held, given that the stevedores engaged by the plaintiff to load its cargo had not done so, that D the plaintiff had established that the damage to its cargo had not arisen from any 'act or omission of the shipper or owner of the goods, his agent or representative' (art IV rule 2(i)). (At 495I--J.)

Held, further, that, since the captain had put to sea despite his misgivings concerning the stowage and lashing of the plaintiff's cargo, it was at least as likely as not that fault or neglect E on the part of the captain had contributed to the damage. The defendant could therefore not rely on art IV rule 2(q) of the Rules. (At 497I--I/J.)

Held, further, as to the implications of the 'FIOS' inscription, that the object of the Hague Rules was to define, not the scope of the contract of service, but the terms upon which such F service was to be performed. (At 498F.) It would thus have been open to the parties to have agreed that the plaintiff, as shipper, or its appointed agent would, at the plaintiff's expense, arrange for the loading and stowage of its cargo on the defendant vessel. This was, in fact, what they had agreed to. (At 499D--D/E.)

Held, further, however, in view of the fact that the shipowner, through the master, had an overriding power to supervise the stowage because he was responsible for the safety of the G ship and its crew and for the care of other cargo, that such an agreement would not per se relieve the shipowner of any duty he might have to ensure that the cargo was properly and carefully loaded and stowed, such obligation always being subject to the protection afforded by art IV rule 2(i) or (q) of the Rules: something more than an agreement that the shipper would arrange and pay for the loading and stowage would be required. (At 499D/E--F, 50C--D/E and 503A--B.) H

Held, further, that the bill of lading in this instance, which went no further than to stipulate that the carrier's agent was to 'arrange' the loading, discharge and delivery of the cargo, unless otherwise agreed, was silent on the question of who was to load or stow the cargo, or who was to be liable for bad loading or stowing. (At 503D--E.)

Held, accordingly, that, notwithstanding the 'FIOS' inscription on the bill of lading, the I defendant had retained an overriding or residual obligation to ensure that the plaintiff's cargo was properly and carefully stowed on the vessel and was thus liable for damages to the plaintiff. (At 504F and I)

A new section, s 2A, was introduced into the Prescribed Rate of Interest Act 55 of 1975 ('the Act') on 5 April 1997. In terms of that section interest on every unliquidated debt as determined, inter alia, by a court may be J

1998 (1) SA p490

awarded from the date on which...