These proceedings arose from a cargo claim brought by the respondent insurer against the appellant port company for damage caused to a mast and boom being loaded onto a ship in the relevant port by stevedores. The Court of first instance found in favour of the insurer.

The appellant port company appealed to the Provincial Court, arguing that Chapter IV of Title V of the Law on Maritime Navigation (the LNM) was incorrectly applied, as the matter related to international carriage of goods under a bill of lading regime; and that the Court below ignored the provisions of the relevant bill of lading, which contained a Himalaya clause covering the port company and its subcontractors, and extended to their benefit the application of the LNM, including the one-year limitation period. This period is contained both in the bill of lading itself and in the Hague-Visby Rules, and is of mandatory application to operations related to transport under bills of lading. Subsidiarily and alternatively, the appellant port company argued that the rules regarding limitation of liability and conduct barring limitation were erroneously applied by the Court below.

Held: Appeal dismissed.

As to expiration of the insurer's action, the appellant port company argues that, on an application of the Himalaya clause, it is entitled to the same limitation period as the carrier, ie, one year under the Hague-Visby Rules. Having paid its insured, who was the shipper in this case, the insurer's subrogated action is governed by the bill of lading, with its paramount clause 2 that refers to the application of the Rules. This one-year limitation period is therefore applicable to the carrier, the port company, and the stevedore subcontractors.

The Court below rejected this argument. After differentiating between the two clauses invoked, and even accepting the existence of the Himalaya clause in the bill of lading, and that this implies the extension to third parties of the rights and actions derived from the bill of lading enjoyed by the carrier (and explicitly admitting that this is usually extended to port cargo handlers), the Court held that art 329.2 of the LNM applies, creating a direct and mandatory legal relationship between the shipper and the port operator: 'The regime of liability of the operator for losses, damage or delay in delivering the goods established in this Chapter may not be contractually amended to the detriment of the party contracting the service.' The appellant disputes that conclusion, arguing that there is no handling contract between the shipper and the terminal operator.

This Court agrees with the Court of first instance, since, as indicated in previous judgments, the specific provisions of the LNM are applicable to these cases. The LNM is concerned with the regulation of terminals from a private law perspective, in particular with regard to the so-called port cargo handling contract. This contract is set out in art 329.1: 'By means of a port handling contract, an operator undertakes, in exchange for a price, to perform all or some of the goods handling operations in port foreseen by this Act or others of a similar nature.' Such operations include the following, as set out in art 330.1:

The contracts to handle goods in port may include the loading, unloading, stacking and unstacking operations on board ships, as well as those of reception, classification, deposit and storage on the dock or port warehouses, and those of transport within the port. Likewise, the operations may include matters that are similar or related to the above. They shall all be executed pursuant to the provisions in force applicable to them.

It is an essential requirement of port handling operations that such operations must be carried out in the port or within the port area. Specifically, art 335 LNM provides:

The regime of liability of the port handler and its limitations established in the above Articles shall be applicable to any action directed at compensation of damages, losses or delays experienced, notwithstanding the type of procedure in which the action is taken, as well as its grounds, be they contractual or tortious, and both if they are taken against the port handler or against the assistants it may use to provide the service.

In this case, the Court has to assess the application of art 331 LNM, which provides that 'port handling operations of the goods may be contracted directly by the consignors or consignees, or by those who have undertaken the obligation to verify these on their behalf', which is the case here, and art 336 LNM, which provides:

The liability of the port operator for damages or losses to the goods handled may be demanded, in all cases, by the party that contracted the relevant operations with it. Moreover, the consignee of the goods carried, the handling of which has been undertaken by the carrier, freight forwarder or transport commission agent, shall be entitled to direct action against the operator to claim such liability, without prejudice to also being able to claim such against the carrier, freight forwarder or commission agent.

Therefore, the conclusion reached in the judgment of the Court below is not contrary to the applicable regulations, and must be maintained.

The port operator's liability regime in the LNM is inspired by the United Nations Convention on the Liability of Operators of Transport Terminals in International Trade (Vienna, 1991) and extends to the entire period during which the goods are in the care of the port operator. According to art 333.1 LNM:

The port operator shall be liable for all damage, loss of goods or delay in their delivery caused to the goods while they are under its care, if it does not prove this is due to fortuitous causes and that, in order to avoid the effects thereof, the operator or its assistants adopted all the reasonably required measures. The period of liability of the operator shall last from the moment when it took charge of the goods until when it delivered or made them available to the person authorised to receive them.

The second argument raised by the appellant relates to limitation of liability. The appellant points to an absence of intent or recklessness on the part of the foreman or the crane driver handling the mast and boom. This aspect of the appeal must also be rejected. This case involved the loading of an unusual piece of cargo. A lack of load balancing as extreme as the one that can be seen here involves a negligence that is far from being simple and must be considered aggravated - in so far as the entity directly responsible is an entity specialised in such tasks - being comparable to possible intent, since the lack of attention and care described is unacceptable, accompanied by the considerable damage caused by the very deficient performance of those who had to carry out this task, who did not attend to, or take care of, the correct use and securing of retaining ropes, which they did not even employ. The reasoning of the first instance judgment in this regard must be upheld.