Allocation of Risk Between Cargo Owner and Carrier

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                           FAKULTI PERNIAGAAN, EKONOMI DAN PERAKAUNAN

INTERNATIONAL BUSINESS LAW

(BA33403)

SEMESTER 2, 2017/2018

INDIVIDUALS ASSIGNMENT ( ARTICLE REVIEW)

Title of Article & Journal:

THE AMERICAN JOURNAL OF COMPARTIVE JOURNAL

ALLOCATION OF RISK BETWEEN CARGO OWNER AND CARRIER

REVIEW OF ROBERT HELLAWELL “ ALLOCATION OF RISK BETWEEN CARGO OWNER AND CARRIER’

PREPARED FOR: MADAM IDA SHAFINAZ MOHAMED KAMIL

  The name of this article is Allocation of Risk between Cargo Owner and Carrier and the author of this article is Robert Hellawell. This article is about the U.N convention on the Carriage of Goods by sea that have been signed at Hamburg in March 1978. This conventional fundamentally change the basic rules on allocation of risks between cargo owner and carriers. This convention already throw the ancient concept. This convention will explain the changes against the background of the previous law and try a preliminary analysis of their probable effects.

  Maritime law placed strict liability into the carries. This make the carriers responsibilities to lose or damage the cargo even the carrier does not negligent. The expectations to the carrier liability is only the loss or damage that cause by act of god, public enemy, the inherent vice of goods, the fault of the shipper or the voluntary sacrifice for the safety. During the nineteenth century, this law become old as carriers with the superior bargaining power, forced more exception in the bills of lading. During 1890, bills of lading commonly have exception carrier from liability for almost every cause and type of cargo damage, even where it loss or damage that cause from the negligence of the carriers. British court still use this provisions while Supreme Court struck them as public policy.

  This act does not invalidated the allocation the bill of lading that try to exclude the carriers for the negligence in the case of cargo. This act give terms that the carrier will not responsibilities to the faults in the navigation or management of the ship. This basic rule are call Harter Act compromise that include in The Hague Rules and finally used in Brussels. Carrier from liability to cargo flowing from act, neglect or default of the master marine, pilot or the servant of the carrier in the navigation or the management of the ship.

 This convention also has replace this longstanding rule and in art. 5 (1) has a single standard liability which is the carrier has responsibilities to the loss because of losing or damage the goods, also the delay of the delivery if this happen and cause loss, damage and delay took place while the goods in the carrier responsibilities, as defined in article 4, unless the carrier can prove he or she, his servant or the agents took all the steps that need to avoid this thing from happen and it cause.

  This form of new provision are effected by the language that been used in the convention that related to international transport of cargo by air, rail, motor carriage. Its first half is a form of a strict liability provision while its final clause let go the carrier if it took all steps that could reasonably be required. The exact level of care is needed of the carriers is open to future determination. However, since the language used is new in the area of carriage of goods by sea.

  The drafters of the new convention can use the traditional carriage of goods and sea language and still become a general liability for fault provision. This have entailed provision that need a carries to exercise due diligence to make the ship seaworthy, take care the cargo with the properly way and carefully navigate and manage the ship. The drafter rejected this traditional language in order to conform more closely to the language that been used in the other international transport conventions. This can be an advantage in facilitating the multimodal transportation of cargo. But the traditional language may make easier to the use of existing case and made the meaning of the new convention clearer.

 Under the 1924 Brussels Convention, the carrier who have liability for the fault or negligence of all its employee, include the master and crew. The fire exception provide that the carrier does not liable for the loss or damage cause by fire. Except for the fault or privity of the carrier. The negligence of the carriers’ employee not necessarily cause the carrier liable. The fault must be the carrier own fault. In this case of corporate ship owners, some decisions said that that the negligence of a senior employee or the officer will cause the carrier liability, not just employee or the agent. This special fire exception has been eliminated by the new convention.

  The new convention with the single liability for the standard fault also eliminate the special exclusion list for car liability. This exclusion has been prepared by the Brussels Convention with the exclusion for the navigation and management also fire exception in art. This eliminate include the ancient items as the perils of the sea and restraint of princes seems to be a big cause than actually it is. The eliminate of the catalogue should not make a big substantive different. As the law developed, general exception only can be make if the carrier does not cause the loss or damage and without fault, the carrier will not liable under Brussels Convention in any condition. The perils of the sea explain this matter its except the carriers from liability for loss or damage that cause by danger and accidents of the sea. However if the loss happen despite all reasonable precautions it can be said that the loss is cause by the peril of the sea.