In January 1981, 10,900 tons of wheat were loaded onto the Kapetanikos in Bordeaux, France, for carriage to Venice, Italy. During the unloading operations in Venice, part of the cargo was found to be wet. Seawater had penetrated the vessel's holds because of a broken pipe inside the ship.

The consignee, Grandi Molini Italiani SpA (GMI), brought a claim before the Tribunal of Venice against the agent of the carrier, SAGEM Srl, asking for compensation.

Held: GMI's claim is upheld.

The carrier's obligations to make the ship seaworthy before the beginning of the voyage and to ensure the good conditions of the holds for the reception and the preservation of the cargo imply the carrier's duty to verify the status of all the structures connected with the holds.

To be exempted from liability, the carrier must prove that the damage has not been caused by its fault or that of its employees. However, in this case, the carrier was liable for the damage. First, it chose an old ship for the transport. Second, it did not fulfil his obligation of due diligence to make the vessel seaworthy at the beginning of the voyage and to control the conditions of all the ship's features that could generate negative consequences for the holds. The evidential burden of finding the broken pipe which caused the seawater to enter and wet the wheat does not constitute a cause of limitation of carrier liability, in light of the carrier's duty to know the features of the vessel employed for the voyage.