On 31 May 1989, following the discharge of part of the cargo from the Ralph Misener, the remaining cargo on board was damaged by a fire. The cargo owners (the plaintiffs) filed a claim against the shipowners (the defendants) to recover their loss. The plaintiffs argued that their loss resulted from the negligence and breach of contract on the part of the defendants. The defendants denied responsibility and counterclaimed for the loss which they suffered by reason of the fire on board their ship.

The plaintiffs submitted that as a clean bill of lading was issued by the master of the vessel, the burden was on the defendants to prove or to explain the cause of loss. Since the cause of the loss remained unknown, the defendants must, therefore, bear responsibility for the damages caused by the fire.

The defendants raised three arguments. First, they claimed that the cargo was of an inflammable nature and therefore a dangerous cargo. Thus, pursuant to art 4.6 of the Hague Rules which had been given the force of law by the Carriage of Goods by Water Act RSC c 15, the plaintiffs were liable for all damages and expenses incurred by the defendants. Second, they submitted that in any event, they were not liable for the loss suffered by the plaintiffs by reason of art 4.2.b of the Hague Rules, which provided that a carrier should not be responsible for any loss or damage resulting from fire unless caused by its actual fault or privity. Third, the defendants relied upon art 4.2.q of the Hague Rules and claimed that they had been relieved of responsibility with respect to 'any other cause arising without the actual fault and privity … or without the fault or neglect of their agents or servants … '.

Held: The plaintiffs' action dismissed and the defendants' counterclaim allowed.

The cargo was loaded in an extremely dusty atmosphere. It was very difficult for those on board the vessel to properly observe the condition of the cargo. Therefore, the clean bill of lading did not constitute prima facie evidence that the cargo was loaded in good order and condition.

The evidence was overwhelmingly in support of the conclusion that the probable cause of the fire was the spontaneous combustion of the cargo. No rebuttable theory was put forward by the plaintiffs. Therefore, the cargo was indeed dangerous. There was no consent from the defendants to ship dangerous cargo. The plaintiffs failed to inform the defendants of the inflammable nature of the cargo. Thus, it was right for the defendants, relying upon art 4.6 of the Hague Rules, to argue that the plaintiffs were liable for the loss which they suffered as a result of the fire.

It was also worth noting that, in Effort Shipping Co Ltd v Linden Management SA (The Giannis NK) [1998] UKHL 1, the House of Lords held that art 4.6 of the Hague Rules was not subject to art 4.3 of the Rules. Therefore, art 4.6 imposed strict liability on shippers when they shipped dangerous goods, no matter whether they were at fault or not.

[For the subsequent unsuccessful appeal see CMI586.]