International rules of the carriage acknowledge the inherent risks associated with deck carriage and, in most instances, allow parties to share these risks among themselves. Exclusion clauses are typically used to handle these risks during contract negotiations, though different countries may use them differently. For instance, the Hague-Visby regulations in Canada require carriers to fulfill specific requirements before enforcing exclusion clauses, whereas protectionist legislation is still used in America. (Girvin, 130). In this case, gearbulk was to ship 1725 packages of lumber from Vancouver to Antwerp as two consignments. The two consignments were separately covered by two bills of lading and they were bounded for two different consignees. The carrier, gearbulk was at liberty to either stow the entire cargo on/under deck. Consequently, the carrier stowed 86% of the cargo on deck and the remaining 14% under deck and issued subsequent bills of lading stating the 86%-14% stowage, without giving attention to characterizing the precise packages loaded on or under deck (Djadjev, 156). However, the carrier only kept a record of the quantity of lumber loaded in each position. At the discharge port, the deck cargo was damaged leading to the genesis of legal procedure.
During the trial, the contention was between the Hague-Visby rules and the exclusion clause. Plaintiff argued that contract they had entered with gearbulk was to be guided by the Hague-Visby rules which rendered exclusion clause in the contract not applicable in pursuit to article 8(3) of Hague-Visby rules. While the carrier argument was based on the exclusion clause in the bills of lading which stated that deck carriage was at cargo owner's sole risk in case of any damage. There then raised a question if the bills of lading precisely specified which of lumber was shipped on/under deck. It followed that if the bills of lading accurately stated so, gearbulk would not be liable for loss and if the bills could not specifically indicate that the spoiled lumber was carried on deck, exclusion clauses would be invalid (Djadjev, 161).
As such, at the trial motion judge agreed with the plaintiff ruling that gearbulk was liable for losses accrued to timberwest's lumber. Aggrieved by the ruling, gearbulk appealed in the court of appeal which upheld the ruling emphasizing that the stowage representations on the bills of lading were insufficient in relation to specifications of individual consignments. It was impossible to establish the value of deck cargo since exact packages on deck were not identifiable. Ambiguity in the depiction of deck cargo amounted to the absence of crucial information that could have activated applicability of exclusion clause (Djadjev, 156). The appeal was dismissed meaning that gearbulk acted with negligence and hence liable for tort.
U.S Consignee
The US consignee is likely to lose the lawsuit in Hong Kong because the People's Republic of China applies the Hague-Visby rules to contracts of carriage covered by a bill of lading or any similar document of title. Article III rule 6 imposes a one-year time limit for any offended party to institute legal proceedings (Girvin, 136). The time limit does not only apply to claims for damages and lost cargo but also for general average and salvage contributions. In most cases, most of the bills of lading do not indicate this notice on the face of a bill of lading and it is most probable that the bill of lading issued to the US consignee did not contain this notice.
Reference
Djadjev, Ilian. "The Carrier's Obligations over Deck Cargo." The Obligations of the Carrier Regarding the Cargo. Springer, Cham, 2017. 151-245.
Girvin, Stephen. Carriage of goods by sea. Vol. 7. Oxford University Press, 2011. 124-186
