This was an appeal from the judgment of the 1st Commercial Court (24 November 2015, 2015/321-2015/573).

The plaintiff consignee claimed that chickpeas purchased from Negza Trading LLP and shipped on the MV Amur 2532 were damaged during transportation from the Port of Azov. Therefore, the defendant carrier was liable for the damage under art 1178 of the Turkish Commercial Code (the TCC) [which is based on art 3.2 of the Hague Rules, art 3.2 of the Hague-Visby Rules, and art 4.2 of the Hamburg Rules - although Türkiye is only a State Party to the Hague Rules, the TCC incorporates a set of rules which purport to adopt elements of the Hague-Visby Rules and the Hamburg Rules]. The plaintiff argued that in implementing the transport contract, the carrier must pay strict attention, as expected of a prudent carrier, to the loading, stowing, handling, transportation, protection, supervision, and unloading of the cargo.

The defendant carrier argued that arbitration was agreed upon as the means of resolving any disputes under the charterparty, dated 16 October 2014, regarding the relevant maritime transport, and that the parties had accepted this arbitration agreement by referring to this charterparty in the bill of lading dated 28 October 2014. The defendant carrier requested that the claim be rejected because the arbitration clause outlined in the contract of carriage concluded between the shipper and the carrier, as well as the provisions of the contract of carriage, were binding upon the holder of the bill of lading, as there was a reference to the provisions of the charterparty in the bill of lading.

The Court of first instance observed that the bill of lading is considered when determining the relationship between the carrier and the lawful holder of the bill of lading, in line with art 1237.1 of the TCC. In particular, the bill of lading governs the legal relationship between the carrier and the holder of the bill of lading. This means that the third-party holder of the bill of lading is only bound by the content of the bill of lading, and the terms and conditions provided in the contract of carriage do not apply to the holder of the bill of lading. On the other hand, the relationship between the carrier and the charterer is governed by the provisions of the contract of carriage. The Court found that it was stated in the bill of lading dated 28 October 2014 that '[i]t will be used together with the charterparty', and found that in the charterparty dated 16 October 2014, it was stated that '[a]ny dispute between the parties shall be settled by arbitration'. Thus, the Court held that the lawsuit should be dismissed.

The plaintiff appealed to the Supreme Court of Appeal.

Held: The appeal is admissible. The judgment of the first instance Court is reversed in favour of the plaintiff on the grounds below.

The Supreme Court of Appeal referred to art 1237.1 of the TCC, which provides that charterparty terms apply to disputes between shipper and carrier. In contrast, the bill of lading terms applies to disputes between a consignee/lawful holder of a bill of lading and a carrier. As an exception, where there is a reference to charterparty terms in the bill of lading, and a copy of the charterparty is presented to the consignee along with the bill of lading, the charterparty terms are deemed to be incorporated into the bill of lading and become applicable to the consignee.

The Supreme Court observed that although the defendant relied on the arbitration clause in the charterparty, the plaintiff argued that only a copy of the bill of lading was given to him, not a copy of the charterparty agreement. The Supreme Court further found that the burden of proof that the charterparty has been presented to the consignee is on the carrier, and the carrier failed to prove that the charterparty was presented to the holder of the bill of lading.

The Supreme Court held that the Court of first instance erroneously considered the reference to the charterparty in the bill of lading to be sufficient. As a consequence, the Court of first instance's judgment should be reversed in favour of the plaintiff.