La Estrella SA de Seguros y Reaseguros (the plaintiff) filed a cargo claim against Navarro y Boronad SL, Containers y Transportes SA (Cotinsa) and Murat Naiboglu Shipping (the defendants). The claim arose out of an incident on 26 March 1996 in the port of Gandía on board the ship Murat Naiboglu due to improper stowage of cargo (asphalt fabric) that was destined for the port of Oran in Algeria. The transport derived from a CIF sales agreement between the seller, Asfaltos Chova SA, and the buyer, Office de Promotion et Gestion Inmobilière de Bird Murad Rais​. The plaintiff had compensated the seller and claimed, based on art 780 of the Commercial Code, against the company responsible for carrying out the stowage (Navarro y Boronad SL) and against the shipping company (Cotinsa). The Court of First Instance of Gandía held in favour of the defendants. The plaintiff appealed. The Provincial Court of Valencia reversed the first instance judgment and ordered the defendants to pay the plaintiff ESP 6,567,067 plus interest and costs. The first two defendants filed an appeal for cassation against the Provincial Court's decision.

Held: The Provincial Court's decision is upheld. 

The Supreme Court dismissed the defendants' arguments based on the passing of risk under CIF Incoterms. The Court also dismissed the argument of Cotinsa that, because the shipment was conducted under a FIOS (Free In and Out and Stowed) clause, loading and stowing the goods on board the ship was therefore at the risk of the shipper.

The Court held that this was a case of maritime transport of goods under the bill of lading regime, to which the Law of 22 December 1949 would be applicable, which introduces into Spanish legislation the rules of the Brussels Convention of 25 August 1924 (modified by the Protocols of 1968 and 1979), which contains the Hague-Visby Rules and SDR Protocol. In accordance with the Hague-Visby Rules, the carrier must 'properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried' (art 3.2) and every clause, covenant or agreement 'relieving the carrier or the ship from liability for loss or damage to, or in connexion with, goods arising from negligence, fault, or failure in the duties and obligations provided in this Article or lessening such liability otherwise than as provided in this Convention, shall be null and void and of no effect' (art 3.8). The clause 'FIO' (Free In and Out) means, in international maritime transport, 'loading and unloading without cost for the ship', while the modality of 'FIOS' (Free In and Out Stowed) has come to be translated as 'loading, unloading, stevedoring at no cost to the ship' ('stowed' is storage that applies to containers or packaged goods). The variant 'FIOST' (Free In and Out Stowed/Trimmed) is applied to the leveling of bulk merchandise.

In general, it is emphasised by legal doctrine that FIO, FIOS, or FIOST clauses are to be translated into cost-sharing within the shipping market. Sometimes, however, the printed forms indicate that cargo operations have to be carried out by the shippers and their agents, free of risk, responsibility and cost of any kind for the ship, in such a way that they try to place not only the cost but also the risk of the relevant operations on the shipper. However, stowage is understood as the operation of fixing and arranging the cargo inside the vessel that contains it. In the absence of a contraindication, the responsibility for stowage in all its aspects rests with the carrier, and the mere indication that the costs will be supported by the shipper is not enough to reverse this rule. This is what can be deduced from the rule of art 3.8 of the Hague-Visby Rules, previously referred to. Thus, in principle, the 'FIOS' clause is a financial clause, unless otherwise indicated. This accords with English law in cases such as Jindal Iron Steel Co Ltd v Islamic Solidarity Shipping Co Jordan Inc and Pyrene v Scindia Navigation (CMI2100), amongst others.