‘Mouldy’ rice cargo triggers dispute
Posted: 26th June 2015
Shipping contracts usually impose liability for cargo damage arising during loading or unloading on carriers. However, that position can be overridden by clear contractual wording and that is what happened in the case of a large consignment of rice which was said to have been delivered in a wet and mouldy condition.
The owners of the cargo claimed substantial damages from the carrier on the basis that some of the more than 450,000 bags of rice had been delivered torn and in an unfit condition. The carrier accepted that it was liable for damage caused whilst the cargo was stowed in the ship’s hold.
The High Court noted that, as a matter of common law, responsibility for damage arising during loading or discharge of the cargo would also fall on the carrier. However, it found that, on a true interpretation of the relevant charterparty, that position was reversed and liability fell on the charterer and/or cargo owners. Further issues in relation to liability and the value of the claim remained to be resolved.