The claimant, Alianca Navegacao e Logistica Ltda (Alianca), the disponent owner of the M/V Santa Isabella, claimed for demurrage and associated expenses totalling USD 858,383.22 following lengthy delays to the discharge of a cargo of 44,000 mt of white corn/maize. The cargo was found to have suffered extensive damage on arrival at the ports of Durban and Richards Bay, South Africa, after a 39-day voyage from Topolobampo, Mexico, to Durban. The vessel was chartered to the defendant, Ameropa SA (Ameropa), on an amended Synacomex Charterparty form, cl 23 of which incorporated the Hague-Visby Rules.

Ameropa alleged that the damage to the cargo and the delays at Durban and Richards Bay were caused by the vessel taking the Cape Horn route rather than the Panama Canal route from Topolobampo to Durban; failure by the vessel to ventilate the cargo in accordance with a sound system; failure by the vessel to disinfest areas of the vessel outside the cargo holds following loading at Topolobampo; and/or the vessel proceeding to Durban at less than its warranted speed.

Held: i) Alianca was not in breach of the charterparty by taking the Cape Horn route to Durban.

ii) The vessel did not proceed to Durban in accordance with its warranted speed, but it was not possible to identify any particular element of damage or loss caused by that breach.

iii) The cargo was not properly and carefully ventilated in accordance with a sound system, in breach of Alianca's duties properly to care for the cargo.

iv) That breach was the cause of damage to the cargo, which but for the breach would on the balance of probabilities have arrived with damage limited to 6-12 inches of dried crust on the top of each stow. That in turn was the cause of the long delays in discharging at Durban.

v) Alianca was also in breach of its duties properly to care for the cargo by failing properly to disinfest the vessel's topsides, that being on the balance of probabilities the likely cause of the insect infestations encountered at Durban and Richards Bay. The latter infestation was the cause of delay in discharging at Richards Bay.

vi) But for Alianca's breaches, the discharge process at Durban would, on the balance of probabilities, have been completed within 8.5 days (3.7 days in excess of the remaining laytime after the vessel's actual arrival at berth) and the discharge process at Richards Bay would, on the balance of probabilities, have been completed within the laytime of 3.68 days.

vii) The South African authorities did not quarantine the cargo within the meaning of cls 23(3) and/or 46 of the charterparty.

As to finding i), Ameropa argued that the route taken around Cape Horn constituted a deviation and a breach of art 3.2 of the Hague-Visby Rules. Ameropa accepted that it bore the legal burden of proving a breach of art 3.2 because the relationship between Ameropa and Alianca under the charterparty was purely contractual, rather than being one of bailment: the bailor/bailee relationship was between the head owner of the vessel and the holders of the bills of lading. However, Ameropa submitted that the presence of the cargo damage on discharge gave rise to an evidential burden on Alianca to show that no breach of art 3 had occurred, relying on Albacora Srl v Westcorr & Laurance Line Ltd [1966] 2 Lloyd’s Rep 53, 63-64 and The Bunga Seroja [1999] 1 Lloyd’s Rep 512. Ameropa argued that although the Supreme Court in Volcafe Ltd v Compania Sud Americana de Vapores SA [2018] UKSC 61 (CMI221) disapproved these judgments to the extent that they suggested that a cargo owner had the legal burden of proof (holding that, under a contract of bailment, that burden was on the carrier), the Court did not disagree with the proposition that under the Hague-Visby Rules the carrier would have the evidentiary burden.

The Judge held that the Supreme Court did not specifically address the latter proposition in Volcafe. It was unnecessary to resort to burden of proof in order to decide the present case. As a matter of common sense, the arrival in a seriously damaged condition of a cargo loaded in apparent good order and condition called for an explanation, and a want of care on the part of the shipowner was a possible inference. Alianca’s explanation was that the length and/or route of the voyage made damage inevitable. On that basis, it was for Ameropa to show, on the balance of probabilities, that the damage suffered in fact arose from a breach of contract by Alianca.

Having reviewed the evidence and authorities on deviation, the Judge held that the Cape Horn route was a usual and reasonable route for the purposes of identifying the contractual route, and so did not amount to a deviation by Alianca​.

Ameropa alternatively submitted that the choice of the Cape Horn route was in breach of Alianca's cargo care obligation in art 3.2 of the Hague-Visby Rules. Alianca argued that Ameropa’s submission conflated two fundamentally distinct parts of the shipowner's duties: i) duties arising from the vessel as a moving object, including in particular the seaworthiness obligation in art 3.1 and the duty not to deviate; and ii) duties of a warehousing nature, including in particular the cargo care obligation in art 3.2. Alianca submitted that the only overlap between the Hague-Visby rules and the law on deviation is to be found in art 4.4: 'Any deviation in saving or attempting to save life or property at sea or any reasonable deviation shall not be deemed to be an infringement or breach of these Rules or of the contract of carriage, and the carrier shall not be liable for any loss or damage resulting therefrom.'

The Judge held that, as a matter of ordinary language, a decision to hold a course through the middle of a storm in circumstances where that could reasonably be expected to result in damage to the cargo would be a failure falling under art 3.2, notwithstanding that it concerned the course steered by the ship rather than matters occurring onboard the ship. However, this overlap must be kept within appropriate limits. It cannot be elevated from the level of local course decisions based on local weather conditions to the overall routing decision for the voyage as a whole. That would overlay the relatively clear and well-established principles for identifying the contractual route with a need for wide-ranging consideration of the subtleties of how cargo being carried by the vessel may be affected by the variables of alternative routes. Ameropa’s approach would create considerable uncertainties and would in reality displace the well-established law on contractual route. Leaving aside strictly localised situations such as those in The Washington [1976] 2 Lloyd's Rep 453, Ameropa’s approach could not be reconciled with long-established case law and there appeared to be no authority in support of it.

Finally, Ameropa suggested by analogy with the decision of Teare J in Alize 1954 v Allianz Elementar Versicherungs (The CMA CGM Libra) [2019] EWHC 481 (Admiralty) (CMI362) that it could alternatively have framed its case as one of unseaworthiness under art 3.1 due to the vessel having a defective passage plan. Aside from the fact that the case was not framed in that way, the Judge found that this argument would have been subject to the same objections as the art 3.2 argument.

As to findings iii) and iv), under art 3.2 of the Hague-Visby Rules Alianca had a duty properly and carefully to carry, keep and care for the cargo. In Volcafe, the Court of Appeal (see CMI38) noted that a sound system of cargo care does not mean one that will necessary prevent damage. A sound system does not need to be supported by scientific theoretical calculations or empirical studies. In deciding what was a sound system, it was wrong to ignore evidence of general practice in the industry.

In this case, the cause of the damage was ship’s sweat. On the evidence, had there been proper ventilation by Alianca when it was safe to do so (including ventilation at night save when weather conditions made it unsafe), the likely outcome would have been 6-12 inches of dried crust at the top of the cargo but no greater type or degree of level of cargo damage.

The Judge therefore rejected Alianca’s submission that the moisture damage to the cargo was an inevitable consequence of proceeding to Durban via Cape Horn and complying with the fumigator’s instructions not to ventilate during the first 12 days of the voyage, as well as its submission that the cause of the cargo damage found on arrival at Durban fell within art 4.2.q of the Hague-Visby Rules, which provides that the carrier is not responsible for loss or damage arising from 'any other cause arising without the fault or privity of the carrier'.

As to finding v), the infestations resulted, on the balance of probabilities, from inadequate cleaning of the topsides following loading and again following fumigation in Durban, and the shipowner thereby breached its duty under art 3.2 and was not protected by art 4.2.q.