August 10, 2015MS Susanne 1 M/S Susanne The Danish ship M/S Susanne on a voyage from Copenhagen to Tromsø ExporterNeptun Ship owner Baltime t/c Gencon 1994 v/c

August 10, 2015MS Susanne 2 M/S Susanne In Chopenhagen 3 bills of lading are signed by Hanssen, agent of Neptun EksportørHansen Neptun Agency contractTramp Bill of lading NMC 325 v/c Gencon 1994

August 10, 2015MS Susanne 3 M/S Susanne On delivery at the port of Tromsø: ExportersHansen Neptun Agency Tramp Bill of Lading Importers Sales agreement Ship Owner t/v Damage

The claim: The importer of the cement claimed compensation for the damages from Neptun –and The owner of the vessel What could be the legal bases for the claims?

Tramp Bill of Lading NMC § 325  Govern the conditions for the carriage and delivery of the goods as between the carrier and a third party holder  Provisions which are not included in the bill of lading can not be invoked…unless the b/l includes a reference to them  What legal regime? § – see § 253 August 10, 2015MS Susanne5

NMC § 253 Charter Party Trade  If a b/l has been issued under a charterparty chapter 13 applies to the b/l if it governs the legal relationship between the carrier and the holder of the b/l August 10, 2015MS Susanne6

August 10, The bills of lading  Common content:  ”In apparent good order and condition”  ”Subject to terms and conditions of charter party (where/when signed unknown to us)”

August 10, Who is who? § 251(chp13)  Neptun Carrier (contractual carrier)  Ship owner Sub-carrier (actual carrier)  Exporter/Seller Sender (cif seller) Shipper (delivers the goods)  Importer Receiver

August 10, Main issue  The importer of the cement claim compensation for the damages from Neptun (contractual carrier) The ship owner (sub-carrier)

August 10, Legal questions  1) Is the bill of lading agreed between 1.1) the sender 1.2) the receiver and Neptun The ship owner  2) If yes, is the c/p agreed between the importer and Neptun/the ship owner? Question of interpreting § 325  3) Are the carrier/sub carrier liable for the damages?

August 10, Is the b/l agreed between Neptun and the sender?  Gencon 1994 is regulating the relationship between Neptun and the exporter (charterers)  Gencon clause 10: Bills of lading shall be signed by the Owners agent provided Written authority to the agent With copy to charterers Not fulfilled  Conclusion: The b/l is not agreed between Neoptun and the senders

August 10, Can the bill of lading still be valid in relation to the holder?  The holder is the importer.  In good faith  A question of authorization NMC § 338:The voyage carrier shall issue a shipped bill of lading on request. Issues by: ”the voyage carrier or the master or the person otherwise authorized…” Is Hanssen authorized?

August 10, Authority  About the intermediary's power to bind the principal Common law: The agent's power is derived from the internal relationship. The power to bind is tied to the mandate  Nordic law: The message to a third person is the basis of the agent's contracting powers If the agent exceeds the authority given him in the internal relationship, the principal still becomes bound by virtue of the message to the third party, if the third party is in good faith

August 10, Does Hansen have powers to issue a b/l on Neptuns behalf?  Not regulated in the NMC, but in the Contracts Act 31 May 1918, nr. 4, chp. 2  Question: what did the importer have reason to believe? Neptuns standard documents Agent for 5 years Normal procedure Risk on Neptuns side  Conclusion: Hansen have powers to bind Neptun

August 10, What about the ship owner?  NMC § 286:The sub-carrier is liable for such part of the carriage as he or she performs, pursuant to the same rules as the carrier  The wording: ”same rules” Pursuant to the same rules Liable when carrier is liable  The good solution for description liability?  No legal base to claim the sub-carrier for description liability

August 10, A digression  Assume the b/l was signed by the master: NMC § 137: The masters position of authority will bind the ship owner NMC § 295: A b/l signed by the master shall be deemed to have been signed on behalf of the carrier (Neptun)

August 10, Does the b/l include a reference to the Gencon 1994?  NMC§ and § 325: Provisions of the chartering agreement which are not included in the b/l can not be invoked unless the b/l includes a reference to them.  ”Includes a reference to them”  General reference not enough. If yes, Gencon has no impact on the question on misdiscription  The bill of lading and the NMC are applicable.

The damages  Bill of lading I and II (misdescription)  Bill of lading III (transport damage)

August 10, The liability  Neptun/Contractual carrier: Transport liability §§ 274 Liable for the sub carrier § 285 Bill of lading § 299: The carrier has loaded the goods as stated in the bill of lading  The ship owner/Sub carrier.§ 274 flg jfr. § 286 “liable for such a part of the carriage as he or she performs, pursuant to the same rules as the carrier.“

August 10, Bill of Iading I  Breach of sales contract.  Invisible for others than experts  ”In apparent good order and condition, weight etc unknown”.  The cargo is in accordance with the description”.  No “damage” according to the NMC

August 10, Bill of lading II  ”5 bags torn”  15 out of 1000 bags delivered empty  This means that 10 bags is damaged during transport.  BUT: 10 bags was delivered empty by the sender, and overseen by the master during inspection  Section 298 – a duty to inspect or make a reservation  What about the 5 bags torn?

August 10, Bill of lading II  5 bags torn/empty – no liability  Neptun:  10 bags empty: Section 299 third paragraph Implied transport liability/description liability Not possible to proof himself innocent Neptun is liable as contractual carrier  The ship owner: §§ not applicable, the damage took place before the carriage stared Not liable

August 10, Bill of lading III  ”A few wet bags”  The cement in 500 bag totally damaged because of water  Typical transport damage  Both Neptun and the Ship owner might be liable: Neptun as contractual carrier with liability for sub carrier, § 285 The ship owner as sub carrier, according to § 286

August 10, The main rule on liability; NMC § 275  NMC § 275: Negligence with a reversed burden of proof  NMC § 276: Exemptions 1) Fault or neglect in the navigation of the ship or 2) Fire MC § 276, second paragraph: not if ”initial unseaworthiness”  NMC § 275 applies – both are liable  But, is § 276 nr. 1applicable ?

Is § 276 nr applicable?  Not liable if ”fault or neglect in the navigation or management of the ship”  Navigation of the vessel Steering and manoeuvring, response to signals etc.  Management of the ship The ship's condition, manning and equipment  Borderline cases Was the act or omission primarily in the interest of the cargo or the ship? ND NSC Sunny Lady August 10,