The plaintiff insurer claimed MTL 3,380 for a survey fee and the value of damage done to its insured's consignment of sugar imported into Malta by the defendant on the CMA CGM Voltaire, which arrived in Malta on 20 September 2001. The defendant denied liability.

The Court of first instance upheld the plaintiff's claims. The defendant appealed to the Court of Appeal, arguing that the first instance judgment failed to comply with the principles governing the burden of proof, as well as to assess certain clauses incorporated in the bill of lading. It contended that it was incumbent upon the plaintiff to prove the condition of the goods at the time they were entrusted in the custody of the carrier, and at the time they were delivered to the consignee. The first instance judgment, in addition to failing to examine the scope of certain important clauses, also failed to take into account the fact of the 'package limitation' set out in cl 18 of the bill of the bill of lading.

Held: Appeal upheld. The first instance judgment is overturned.

This Court agrees that the judgment under appeal erred both in its failure to take into account those clauses which should have received due attention in the matter in question, as well as in-depth examination of the principle of the burden of proof.

It is settled law in the maritime field that the laws governing the transport of goods from one destination to another usually comprise three distinct phases: that is, the pre-loading phase of the goods on board the ship, the phase relative to shipping, and the subsequent phase for unloading the goods from the ship. These three phases are well regulated by the Brussels Convention 1924, better known as the Hague Rules, codified in Maltese law in Ch 140 on the Carriage of Goods by Sea Act. Particular provisions of this Convention are attached to the above phases. Thus, for example, with the first and third phases, art 7 expressly provides that the contracting parties may enter into an agreement or impose conditions, reservations, or exemptions 'as to the responsibility and liability of the carrier or the ship for the loss or damage to, or in connexion with, the custody and care and handling of goods prior to the loading on, and subsequent to, the discharge from the ship on which the goods are carried by sea'.

Having affirmed these preliminaries, the proof of loading onto the ship is constituted by the bill of lading. As a rule, bills of lading contain the terms and conditions that apply to the particular carrier. The relevant bill of lading does not lack them and shows, by specific clauses in it, the modalities governing transport. It is only natural that the burden of proof on the parties should depend on the content and scope of these clauses. This is also because these same clauses create by their very nature certain presumptions constituting rules of evidence. This means that in matters of marine cargo claims the distribution of the burden of proof is in fact more complex than that of other ordinary matters, civil or commercial.

In this case, the defendant relies heavily on the scope of the 'said to contain' and 'shipper's load, stow and count' clauses. Clause 7(b) of the bill of lading explains that these clauses mean 'that the goods were loaded, packed or stuffed by the Merchant, and all description of such goods (including marks and numbers, and kind of packages, description, quantity, quality, weight, measure, nature, kind, value, or any other particular) are furnished by the Merchant and have not been checked by the carrier'.

It has been held that this clause 'operates in favour of the master until proven otherwise that the quantity of surrendered and delivered goods is presumptively to be considered the same that was entrusted to him': Zammit NOE v Paciello, Commercial Appeal, 1 June 1863 ( Kollez vol II p 596). This also applies in the case of the 'shipper's stow, load and count' clause to which it relates: Conti NOE v Apps NOE, Appeal, 27 January 1997.

It is inferred from the foregoing that the burden of proof of the quantity or weight of the goods lies upon the shipper or the consignee. This is reflected in the logic that since the carrier did not interfere with the stuffing of the goods into the containers, the proof of quantity does not fall upon it. The carrier received closed and sealed containers under its control and custody. In fact, the clauses in question, which are binding on the parties (Kollez vol XXIV p 995), are intended to offer protection to the carrier. This is because it was not involved in the operation of stuffing the goods into the container.

It follows with equal reason that the shipper or consignee must provide proof of the quality and condition of the goods when they were stuffed into the containers. It is not sufficient, then, for the consignee to demonstrate the state of the goods at the time of receipt when they passed into its possession, but must show satisfactorily that this same condition does not correspond to the state of the goods at the time of their receipt by the carrier. This is precisely because the consignee is alleging and attributing guilt in the ship, and therefore needs to prove facts constituting the cause of the loss or damage in relation to the negligence attributed by it to the ship. It is only when it succeeds in doing so that the burden of proof shifts to the ship to show, with conviction, that the loss or damage was not due to its negligence, even, for example, by showing that the damage was the effect of a defect in the goods, either by force majeure or for any other reason among those listed under art 4 of the Hague Rules for the purpose of exoneration from liability. Once one of these reasons has been established, the burden will be passed back to the consignee.

By contrast, if the proof of the internal condition of the goods lies with the consignee, the ship is encumbered with proof that the containers received by it have been unloaded in the same condition as when they were loaded onto the ship.

Having reviewed the evidence, this Court is satisfied that the ship has proved that the containers were internally and externally in good condition in such a way that it was not possible for water to penetrate them. The same cannot be said with regard to the proof of the condition of the goods at the time of their stuffing into the containers.

Of course it has been proven that the goods were damaged by moisture. This Court offers a possible explanation for this factor. From the analytical tests and the survey report it is likely that this wetting was attributable to condensation inside the containers, in which case cl 6(4) of the bill of lading applies, which exempts the carrier from liability in case of 'condensation inside the container or any like condition due to moisture'.

In any case, the plaintiff has failed to prove the state of the goods at the time they passed into the possession of the ship. It was vital to demonstrate the causal link between the conduct of the carrier and the damage found, and this was not satisfied.

Having reached this conclusion, this Court finds no reason to engage in examination of the subsidiary ground raised in reference to the limitation of liability in terms of cl 18 of the bill.