Update Volume 2021/09 Responsibility for loading operations and demurrage in cases of cargo damage (inland shipping)
Recently, the Court of Antwerp rendered judgment in a case we had been handling since March 2018. It concerned contamination of a cargo of liquid fertiliser on board an inland vessel, pursuant to which the receivers had refused to take delivery of the cargo. After a long delay, the vessel was finally discharged a month after arriving in the discharge port.
The cargo had been loaded in Antwerp under the supervision of the shipper and their surveyor. During the negotiation of the Charterparty terms, the owner had clearly informed the charterers that the cargo tanks would not be cleaned but only ventilated based on the previous cargoes carried on board. In light of the fact that the owner had clearly described the condition of the holds and this had been accepted by the charterer, the responsibility for the suitability of the holds to transport the cargo in question had passed to the charterer.
As a significant cargo claim had been filed against the owner, we conducted an extensive investigation into the cause of the contamination. It turned out that there was contamination right from the start of the loading operations and the shipper and the surveyor were aware of this, however they decided to continue loading the cargo. The court determined that the master reasonably assumed that the shipper knew what they were doing given that he had been clear in advance about the condition of the holds and they were represented by a surveyor. Unfortunately, it turned out that the information about the condition of the holds had gotten stuck somewhere in the chartering chain. However, the court concluded that this did not take away from the fact that the shipper had decided to continue loading despite the fact that contamination had already been detected.
In addition to the cargo damage, a considerable amount of demurrage had been accrued by the owners. The charterers had rejected this claim on the basis that the shipowner was responsible for the contamination and was therefore not entitled to recover his loss of time. At the end of last year, we already wrote an article (available on our website here) about the right to claim for demurrage in the event of cargo damage.
In its judgment, the Court of Antwerp ruled that the owner could not be held liable for the contamination as he had complied with the obligation to provide information about the condition of the holds in advance. In addition, it was the responsibility of the shipper, who knows his cargo best, to judge whether his cargo can be loaded on board the ship and to ensure that the loading proceeds properly. The judge ruled that the owner was entitled to full payment of the demurrage, given that even if the owner had been (partly) responsible for the contamination, the receivers should have taken action to unload the ship earlier and to mitigate their damages.