Usually, in the case of carrying a cargo of fuel, the ship's tanks are inspected by a cargo inspector prior to loading. It follows from a recent judgment of the Court of Rotterdam, that the content of the certificate issued by the cargo inspector can have an impact on the liability question and extent of damage.
The case concerned the carrying of a cargo of jet fuel by an inland tanker. Our firm acted in this case on behalf of the shipowner and its P&I Club.
The ship's tanks were inspected by the cargo inspector prior to loading. In the certificate which was subsequently issued, the cargo inspector stated the following: "Due to the nature of the product the tank(s) will be finally accepted after analysis of the first foot samples." After setting the first foot, the first foot samples were taken and analysed. The analysis of the first foot samples showed that there was no contamination. Therefore, loading operations were continued. On arrival at the discharge port, samples of the cargo were first taken from the ship's tanks. The analysis of these samples showed that the cargo in part of the ship's tanks was off spec. Subsequently, the surveyors instructed by the involved parties investigated the cause of the contamination. This investigation revealed that the first foot samples were not based on a composite sample of all the first foot samples taken, but instead only on a first foot sample from one of the ship's tanks.
The shipper held the carrier (time charterer) and shipowner liable for damages suffered as a result of the contamination. The Court held that the carrier was liable under Article 16 CMNI Convention. However, in the proceedings, it was argued by the carrier and shipowner, that the cargo inspector had incorrectly analysed the first foot samples, by not making and analysing a composite sample of the first foot samples. According to the carrier and shipowner, this action by the cargo inspector resulted in own fault of the shipper, because the cargo inspector was the shipper’s servant.
The Rotterdam District Court held that in this case, it was established that the shipper could have mitigated damages by (i) taking a sample from the first foot and (ii) immediately analysing those first foot samples for factors relevant to the shipper, and (iii) stopping the loading if the analysis of those first foot samples showed that those samples were not on spec. The failure to take these measures could be contributed to the shipper, according to the Court. The carrier's and shipowner's reliance on own fault therefore succeeded. The Court even ruled that the compensation obligations were limited to the value of the first foot put in the ship's tanks. As a result, only about 10% of the claim was awarded by the Court.
The judgment of the Court of Rotterdam confirms that inspecting cargo tanks and analysing first foot samples is not free of consequences for the shipper and its cargo inspector. No instead, it can even lead to the shipper’s own fault if this inspection and analysis is not carried out properly.
If you have any questions after reading this newsletter, then please feel free to contact us.
