In Volcafe & Others -v- CSAV the Court of Appeal considered the ability of a defendant carrier to rely on the defences in Article IV Rule 2 of the Hague Rules when confronted with an allegation of breach of Article III Rule 2 by way of negligence.
The Court of Appeal held that the cargo interests had established their case but also that the carrier had made out a sustainable defence on the basis of inherent vice (i.e. the condensation was a result of the nature of the coffee beans themselves). It therefore fell to the cargo interests to establish negligence under the Hague Rules. It was also held that a sound system under Article III Rule 2 had been utilised by the carrier.
Cargo interests have obtained permission from the Supreme Court to appeal this decision which will clarify the legal principles that apply to cargo claims, and in particular the burden of proof, the relationship between the defences in Article IV Rule 2 of the Hague Rules and the obligations of the carrier under Article III Rule 2, and the scope of the inherent vice defence.
This article originally appeared in the May 2017 edition of shipping case digest. Other articles include: