Scope of Application, Carrier's Responsibilities and Liability

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The basic convention is the International Convention for the Unification of Certain Rules Relating to Bill of Lading, dated 28 August 1924, usually called the Hague Rules.
  • The Bill of Lading Convention may apply automatically or by agreement (They are obligatory rules). The Rules are automatic when the agreement of carriage is included in the Bill of Lading.
  • When the Bill of Lading is issued in a contracting country.
  • When transportation of goods into a country which is a signatory to the convention.
  • The Rules are not applicable to live animals and cargo shipped on deck.
  • Damage or loss must occur during the "carriage of goods".
Carrier's Responsibilities

An important aspect of the Hague Rules is that when the country of shipment has rectified the Rules or passed an Act in conformity with the Rules, the cargo interests are given a minimum protection of a mandatory character i.e. the carrier can accept a wider liability but he cannot contractually reduce it.

The carrier is bound, before and at the begining of the voyage to exercise due diligence to:
  • Make the ship seaworthy.
  • Properly man, equip and supply the ship.
  • Make the holds, refrigerating and cool chambers and all other parts in which the goods are carried fit and safe for reception, carriage and preservation of foods, in other words, to make the ship cargo-worthy.
The carrier is however not responsible for the following:
  • Unseaworthiness of the ship and if this is not caused by lack of due diligence on his part before and at the beginning of the voyage.
  • Consequences of acts, neglect or faults of the master or his agents in navigation or management of the ship.
  • Liability from the loss of public enemies, act or omission of the shipper, quarantine restrictions, inherent vice (defect) of the goods or insufficiency of packaging.
Carrier's Liability

If the carrier is held liable, his liability would amount to not more than 100 pounds sterling per package or unit unless the nature and value of goods had been declared by the shipper prior to loading and stated in the Bill of Lading.

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