Burns Philp (South Seas) Company Ltd v Marine Pacific Ltd [1979] FJCA 4; Civil Appeal No 07 of 1979 (25 July 1979) aff’g.
Burns Philp (South Sea) Company Ltd v Marine Pacific Ltd [1979] FJSC 9; [1979] 25 FLR 57 (16 January 1979).
Sea Carriage- Bill of Lading- Contract for Carriage of Goods by Sea- Deck cargo
lost at sea; excluded by Bill of Lading
The plaintiff contracted with the defendant to ship cargo from Suva to Labasa. The cargo was carried on the deck of a barge and when the barge was damaged during the voyage, the cargo was lost. The bill of lading was stamped with a clause stating: “cargo carried on deck at shipper’s risk without responsibility for loss or damage howsoever caused”. Condition 26 of the bill of lading provided that “all goods shipped as deck cargo to be carried at owner’s risk”. The bill of lading contained a clause subjecting it to the rules in the Sea Carriage of Goods Ordinance Cap. 207. The plaintiff claimed a breach of contractual duty by the defendant in failing to ensure that the cargo was properly secured, and in failing to deliver the cargo. The plaintiff also claimed a breach of duty under the Sea Carriage of Goods Ordinance. The defendant denied the claims and claimed protection of the exclusion clause inserted by the parties inthe bill of lading.
DECISION: Plaintiff’s claim dismissed.
HELD: The Court said that the bill of lading did stipulate that the rules in the Ordinance did apply. As a result, Condition 26 of the bill of lading on its own would be without effect- by virtue of the application of Article III of the rules which defines the responsibilities and liabilities of the parties. However, the rules apply to “goods” defined as “goods, wares, merchandise and articles of every kind whatsoever, except live animals and cargo which by the contract of carriage is stated as being carried on deck and is so carried”. Thus to escape the operation of the rules the goods must not only be carried on deck, but it must be stated in the bill of lading that the goods are to be carried on deck. The stamped clause in this case fit this exception to the application of the rules, and effectively limited the liability of the carrier. The plaintiff argued that the stamped clause was not wide enough to exclude negligence, and that negligence must be expressly included in the wording of the clause. The court reasoned that the effect of the clause was to change the liability of the carrier from that of a common carrier to a carrier only under an obligation to take reasonable care. There had been no fundamental breach of contract, and to hold the defendant liable would be to deprive the exclusion clause of all of its content.
APPEAL: The plaintiff appealed the decision on the grounds that the lower court should have taken a stricter interpretation of the exclusion clause; and that the defendant had failed to prove that it was not guilty of any fundamental breach. The appeal was dismissed. The plaintiff had not pled fundamental breach. As to the appellant’s argument that the onus was on the respondent to show what had happened to the goods, the Appeal Court found that the appellant had already stated in its Statement of Claim that the goods had been washed overboard.
Failure to deliver the goods per se did not suffice to show fundamental breach without evidence that the loss had been caused by some act outside of the contract of carriage. As to the lower court’s interpretation of the clause, the Appeal Court agreed that the Ordinance did not apply to these goods because of the stamped clause on the bill of lading. The clause was an express stipulation in the contract of affreightment which effectively altered the liability of the carrier. The words were wide enough to encompass negligence; and because of other limits to liability clauses contained in the bill of lading the clause would be without effect if it did not include negligence.