This case concerned whether cargo damage occurred during sea transport, whether the cargo was defective, and whether the owner and/or time charterer of the ship were entitled to demurrage from the cargo insurer. The plaintiff, Groupama Navigation ET Transports (Groupama), filed a claim against the defendants, Elite Rederi A/S (Elite), and AC Ørssleff's Eftf A/S (AC) for the equivalent of USD 58,248.44 and interest. The defendants argued that the plaintiff was ordered to pay USD 16,909.74 in demurrage costs.

Elite was the owner of the Arktis Pearl. Marden Overseas SA, a Panamian company, was the charterer of the ship during the relevant period. AC was a (sub) time charterer. By a charterparty of 17 March 1999, AC undertook to transport 'a full and complete cargo ... of bulk agriprods' (the feed) from Conakry (West Africa) to San Juan (Puerto Rico). The feed was sold by Agrocean SA to Nutrimix Feed Co Inc (Nutrimix). In the invoice of 6 April 1999, the purchase price for 1,822.49 mt of the feed was calculated at USD 163,122.86.

The Arctic Pearl was loaded at Conakry from 27 March 27-1 April 1999, sailed to San Juan from 1-16 April, and was unloaded from 16-29 April 1999. Nutrimix claimed on 27 April 1999 that the cargo had suffered damage. Groupama compensated Agrocean SA, who in turn reimbursed Nutrimix. Groupama was therefore subrogated into a possible claim against Elite and AC.

Groupama argued that the weighing carried out during the unloading of the ship was as good as technically possible, and it showed a shortcoming. The reports submitted adequately documented that cargo damage had occurred. Elite and AC did not claim that there were any disculpatory circumstances. The surveyor confirmed that the cargo was musty and moist. Pursuant to s 279(1) of the Merchant Shipping Act, which corresponds to art 4.5.b of the Hague-Visby Rules, compensation must be calculated according to the value at the place where the goods are, or should have been, discharged. There was a fixed practice for taking the product's CIF value as a starting point. It can be discussed to what extent consequential loss or other consequential damages are cut off by s 279, but the inspection costs can be included in the compensation statement. In the invoice, the price is stated as CIF with the addition 'free out'. The unloading costs may have been a few dollars per mt.

Elite and Ørssleff argued that there was no damage to the cargo. The cargo was allegedly damaged by water penetration and condensation, but there was no evidence for this. The hatches were taped closed after the loading, and it does not appear that they were leaking. The water seen in the photographs was probably due to recent rain. The moisture in the feed and its compression were normal, and the lumps were present during loading. There were no analyses showing that the feed was damaged. The mould amounted to approximately 1% of the remaining 500 mt. It was rather a matter of discolouration, which had arisen through the use of insecticides. The temperatures in the feed were similar to those experienced in San Juan. Furthermore, more than two-thirds of the cargo had been unloaded before the complaint.

Held: Judgment for Elite and AC. Groupama is not liable for demurrage costs.

Given the climatic conditions in San Juan, the Court does not find that the temperatures and humidity levels measured in the feed, in themselves, indicate that parts of this were damaged. Nor do the images presented make it probable that parts of the feed were damaged. The Court finds that the lumping of the feed, and the special humidity in certain places in the feed, were due to recent rain.

It has not been sufficiently proven that parts of the feed lot were damaged while in the custody of the Arctic Pearl.

There is no basis to raise a claim for demurrage against Groupama, nor is Groupama liable for the circumstances that may justify a claim for demurrage.