Nowadays, many businesses have been upgraded itself from dealing with the local customer to dealing with international customers. One of the businesses that have been doing the same is the trading business, also known as the commercial business. When commercial business trade with international business, it is called international commercial. For a trade to be done in international commercial, it requires a shipper of goods and carrier. A business will usually use sea transport to trade between countries overseas because it is the most economical way. A shipper of good is a person who ships the good to the buyer and a carrier is a person who helps the shipper to carry the goods to the buyer. It seems that common law has been giving a lot of duties to the carrier and protect the shipper of good. In this case we will look into Hague Visby Rules and Hamburg Rules to determine if imbalance of bargaining power has been solved.
Prior to the HVR and Hamburg Rules, common law stated that there is difference between common carrier and other carrier. A common carrier is a person who is ready to carry the goods of others for rewards. In England, a carrier may classify as two types of carrier. The first type is the public carrier and the second type is the private carrier. Public carrier is a person who carries goods by land that are not classified as common carriers. The private carrier is a person who carries goods by sea and not classified as common carriers.
The HVR is an international rule that protects more on the side of the carriage of goods by sea. Under the Article 1(b) it is stated that, the HVR will apply to a contracts for the carriage of goods by sea if there is a bill of lading or a similar document of title as in the case of Pyrene Co Ltd v Scindia Navigation . This rule applies to the shipment of the UK. If there is no issued of bill of lading, then the carrier of the goods is not bound to apply. If there is a non-transferable bills of lading or other shipping documents, there is still a chance for the parties apply the HVR. In s1(6)(b) of the Carriage of Goods by Sea Act 1971 stated that, “the parties can incorporate selective parts of the Hague-Visby Rules.” Under Article V, it is stated that, “ the HVR is not applicable to charter parties. However, if it was written in the bill of lading, then the charter parties have no choice but to follow the terms of the HVR in the case of The President of India v Metcalfe Shipping . The HVR will apply to bill of lading regarding to the carriage of goods between ports in two different States “(a)if a bill of lading is issued in a Contracting State, or (b)if carriage is from a port in a Contracting State, or (c)if the contract contained in or evidenced by the bill of lading provides that these Rules of legislation of any State giving effect to them are to govern the contract” according to Article x. As stated under Article 1(c) apart from live animals and cargo, the HVR will apply to all goods, wares, merchandise and articles of every kind. There are two requirements given under Article 1(c) that, the HVR will exclude the deck cargo. The two requirements are (a)the cargo must be stowed on deck and it must be clearly stated in the bill of lading that there is a cargo stowed on deck. In the case of Svenska Traktor v Maritime Agencies , it is stated that, the parties can only negotiate the terms of the contract of carriage if the requirements under Article 1(c) are fulfilled. The carrier can rely on immunities given by the HVR and is not a breach of contract if the goods are stowed on deck under liability clause. In the case of Encyclopedia Britannica v Hong Kong Producer , it was held that “a clause in a bill of lading providing that the carrier is entitled to carry deck cargo is not within the specific reference to the carriage of goods on deck.” There is an uncertainty of law shown in these two cases. Under Article 1(e) it stated “the HVR apply to the contract of carriage from the ‘time when the goods are loaded to the time when they are discharged form the ship.’” Basically, it means that, the carriage’s contract that will use the HVR is during the time the goods are loaded until the time they have release the good from the ship. In the case of Pyrene & Co Ltd v Scindia Navigation Co Ltd the court held that. “although the damage was caused before the goods has crossed the ship rails, this did not essentially mean the exclusion of the rules, and it was stated that no special significance should be placed on the phrase ‘loaded on’.” When it comes to the explanation of the HVR rule, the rules are silent. In the case of Stag Line Ltd v Foscola, Mango & Co , the court held that the explanation of the HVR rule should not control by the previous example. Article 1(a) defines that a person who enters into a contract of carriage with the shipper is also the carrier. The HVR gives a limit time of one year to bring an action against the carrier. If after the time limit the owner did not bring an action then the claim will be lose. The bill of lading will state down what is the name of the carrier. Under Article III rule 1 of the HVR, before or at the beginning of the trip, the carrier exercise due diligence to, “firstly, to make the ship seaworthy. Secondly, is to make all the parts of the ship in good condition in which goods are fit and safe for the reception, carriage and preservations of the goods. Third, is to equip and supply the ship” as stated in the case of The Amstelslot. A carrier has the duty to take good care of the goods that are to be shipped to the destination as stated under Article III rule 2. According to Article III rule 3, there are four requirements that contain in a bill of lading when a carrier is under a duty to issue, which was desire by the shipper. The requirements are the conditions of the goods, the quantity or weights of the goods, the number of packages and the identity of the goods. As described by Article III rule 4, “The statements made on the bill of lading are regarded as ‘prima facie’ evidence of the goods.” It is a duty of a carrier to follow and finish the contract voyage. A contract voyage includes a deviation. However, as stated in Article IV rule 4, a carrier may be escape from the deviation if it is an attempt to save life or property at sea, given in the case of Photo Productions v Securicor. Even though the carrier has a lot of duty but the HVR provide exceptions in favour of the carrier. Whenever there is a loss or damages regarding to the unseaworthiness, the carrier will not be liable if there has been an exercised due diligence to make the ship seaworthy as stated under Article IV rule 1. If there is a negligence or action made by the pilot, master, mariner or the servants of the carrier in the management of the ship then the carrier is off of his liability of the loss or damage of the goods in Article IV rule 2(a), in the case of The Xantho. The carrier will not be liable for the loss or damage to the good if there is a fire, according to Article IV rule 2(b) in the case of Tempus Shipping Co v Louis Dreyfus , perils of the sea, under Article IV rule 2(c) in Hamilton Fraser and Co v Pandorf and Co , act of God, given under Article IV rule 2(d) in Nugent v Smith and others. It is obvious that the carrier is liable for loss and damage under the HVR. However, the term ‘loss and damage’ is not clear to the court is that term only consider the loss or damage to the goods carrier or it also includes to the damage the cargo-owner suffers. The agent or servant may use the defence provided in the HVR under Article IV to the carrier, if the agent or servant is not an independent carrier. The HVR are silent when it comes to the shipper’s obligation. Under Article III rule 5, it is stated that the shipper is to guarantee to the carrier at the time of shipment. As stated under Article IV rule 6, the carrier is not liable for the goods that are dangerous, such as inflammable or explosive goods. The carrier will only be liable for the dangerous good if he gives consent and the goods are destroyed.
One the other hand, Hamburg Rules, which are set out on 31 March 1978, are rules that are to be in charge of the international shipment of goods. The Hamburg Rules is introduced because there was bad system under the HVR. Under Article 1 of the Hamburg, it tells the difference between carrier and actual carrier. According to Article 5, it gives out the liabilities of the carrier. It stated that, the carrier would be liable for the loss or damage to the goods. The carrier will also be liable if there is a delay in delivery, which were in his charge. Unlike the HVR, it did not state clearly that if loss or damage will consider as delay in delivery. However, under Article 5(2), it defines that when is the delay in delivery. It stated that the “delay in delivery occurs when the goods have not been delivered at the port of discharge provided for in the contract of carriage by sea within the time expressly agreed upon or, in the absence of such agreement, within the time which it would be reasonable to require of a diligent carrier, having regard to the circumstances of the case.” According to Article 5(1), it provides that the carrier always has the burden of proof to show the loss or damages. However, the claimant will have the burden of proof if there is an event of fire as stated in Article 5(4). Unlike the HVR, the Hamburg Rules has only three exceptions, which are in favour of the carrier. The first exception is live animals. Under Article 5(5), the carrier will not be liable for the carry of animal if he can show he has been obeying the instructions. Secondly, Under Article 5(6), “the carrier is not liable, except in general average, where loss, damage or delay in delivery resulted from measures to save life or from reasonable measures to save property.” The last exception is stated under Article 5(4)(i)(a), if the claimant can show that the fire was the made by the carrier then the carrier is liable. However, claimant has a two-year limitation to bring an action as stated in Article 20(1). The shipper will be liable for the cost of freight if the goods are shipped under a bill of lading. However, under the Article 15(1)(k), the consignee will be liable if it was stated in the bill of lading. Under Article 17(1), “the shipper is to have guaranteed to the carrier the accuracy of particulars provided by him.” According to Article 13(1), the shipper must mark dangerous goods in suitable manner and that the shipper has the duty to notify the danger of the goods to the carrier. If the shipper did not notify it to the carrier, then the shipper is liable for the loss or damage that the carrier has suffered as in Article 13(2)(a).
In conclusion, it is submitted common law has been favour the carrier. Therefore, the HVR was introduced. The HVR has clearly protects the carrier and gave the carrier more bargaining power. However, in the Hamburg Rules, it does not favour the carrier and it gives a more equal bargaining power to both the carrier and shipper.