COMPANIA SUD AMERICANA DE VAPORES SA V SINOCHEM TIANJIN IMPORT AND EXPORT CORPORATION (THE "ACONCAGUA")

[2009] EWHC 1880 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Christopher Clarke, 24 July 2009

Shipping - Dangerous cargo - Bill of lading - Shipper's liability for dangerous cargo - Negligent stowage - Methods of stowage - Causation - Hague Rules, article IV rule 6

In December 1998, while Aconcagua was under a time charter on NYPE 1946 form to CSAV, she was damaged by an explosion in the hold caused by the self ignition of 334 kegs of calcium hypochlorite stowed in a container. Arbitration proceedings between the vessel's owners and the claimant time charterers were settled and in the present action the same charterers went on to claim damages from the defendant shippers of the calcium hypochlorite for breach of the contract contained in the charterer's bill of lading. The properties of the cargo itself was contentious in that charterers CSAV claimed that it was unstable and prone to self ignition at normal carriage temperatures, whereas shippers Sinochem claimed that it was not abnormal. The container in question should according to IMDG have been stowed away from sources of heat but was stowed near a heated bunker tank. This was admitted by CSAV to be negligent, but was argued by Sinochem to amount to unseaworthiness such that charterers were not entitled to relief under article IV rule 6. CSAV contended that the vessel was not unseaworthy at the start of the voyage and that the fact that the bunker tank was heated was an act for which CSAV was not responsible by virtue of article IV rule 2(a) of the Hague Rules. The issues were summarized as follows. (a) Who bears the burden of proof as to the causative effect (or the lack of it) of the negligent stowage? (b) Was the stowage of the container at position 15-09-06 either the or a cause of the casualty? (c) Was that stowage a breach of the carrier's seaworthiness obligations under article III, rule 1(a)? (d) If not, did CSAV's fault amount to an "act, neglect, or default in the management of the vessel" within article IV rule 2(a)? If so, is CSAV still liable under article IV, rule 6? (e) If CSAV's fault did not fall within article IV, rule 2(a), is CSAV precluded from invoking article IV rule 6 because the indemnity under that article is to be construed so as not to apply in the case of causative negligence?