The plaintiff (Sima Textiles) claimed for the loss of nine cases of fabric which were shipped on the defendant’s vessel (the Thomaseverett) from Korea to Singapore. The bill of lading showed that 25 cases containing 25,000 yards of fabric were shipped on board the Thomaseverett. The plaintiff's case was that they had only collected 16 cases from the PSA godown and as there was a very strict security system in place at the godown it was unlikely the missing nine cases had been taken by unauthorised persons.

The defendant claimed that it had discharged all 25 cases and relied on cl 1 of the bill of lading which provided that ‘the carrier shall not be liable in any capacity whatsoever for any delay, non-delivery or misdelivery or loss or damage to the goods occurring while goods are not in the actual custody of the carrier’. Therefore, the defendant claimed that, as the cases went missing while in the care of PSA, it was not liable. The defendant also pleaded that in the event that it was found liable for the loss of the 9 cases, it was entitled to limit liability to JPY 100,000 per case as per cl 18 of the bill of lading.

It was common ground between the parties that the Hague Rules applied to the carriage of the 25 cases.

Held: The plaintiff’s claim was allowed. Clause 1 of the bill of lading stated the terms of the bill were subject to the Hague Rules. Article 3.2 of the Hague Rules provides that the carrier shall ‘properly and carefully load, handle stow, carry, keep, care for, and discharge the goods carried'. Article 3.3 requires a carrier on the demand of the shipper to issue a bill of lading showing the number of packages or pieces as furnished by the shipper and the apparent good order and condition of the goods.

Art 3.4 provides that the bill of lading shall be prima facie evidence of the receipt of the goods as described in accordance with arts 3.3.a, 3.3.b and 3.3.c. Art 3.5 provides that the carrier is entitled to be indemnified by the shipper against all losses and damages arising from inaccuracies as to the number, quantity or weight of the goods shipped. But this does not limit the carrier’s responsibility and liability under the contract of carriage to any person other than the shipper.

Chao Hick Tin J, in considering the evidence of whether the defendant discharged the 25 cases, was unimpressed by the evidence of the tally sheets provided by the defendant which appeared to be too neat to be contemporaneous documents. The tally clerk himself had passed away after the trial commenced. His Honour also noted that the defendant did not make a police report about the nine missing cases.

The effect of the words ‘said to be’ in the bill of lading describing the cargo means no more than the information was furnished by the shippers and not a qualification. The defendant accepted the cargo as shipped. If it was not satisfied, it should have said ‘contents unknown’. The plaintiff provided evidence that it had contracted with the company in Korea (Kabul Ltd) to buy 25,000 yards of fabric. Payment was made by a letter of credit. The plaintiff then received the commercial invoice, packing list and bill of lading. The plaintiff had business dealings with Kabul Ltd from 1965 and continued to deal with them after the incident. The defendant did not provide any evidence to show that the goods shipped were not those described in the bill of lading or that the quantity shipped was less than the quantity stated in the bill of lading.

The bill of lading is prima facie evidence that the goods were shipped. Article 3.4 shifts the burden to the defendant to show that what was shipped in the 25 cases was not the 25,000 yards of fabric. This they could not do. That in itself would dispose of the matter, however, the plaintiffs even showed that what was contained in the 16 remaining cartons tallied with the packing list.

The governing provision on limitation on liability is art 4.5 of the Hague Rules and not cl 18 in the bill of lading. Clause 1 in the bill of lading provided that in the event of any conflict between the terms of the bill and the Hague Rules, the terms of the bill of lading shall, to the extent of the inconsistency, be void. Art 4.5 sets the limit as GBP 100.00 per package or unit. Art 9 provides that the monetary units are to be taken as the ‘gold value’. This is to provide ‘a single and constant measure of value by reference to gold not a fluctuating value’ (The Rosa S [1989] 1 QB 419 (CMI2232)).

The plaintiff claimed for USD 8109.90 (USD 910.10 per carton) in total. Chao Hick Tin J calculated that GBP 100.00 of gold value in 1924 was equivalent to GBP 4896.00 on the day of the breach. The rate of exchange between the GBP and USD was equivalent to USD 9938.00 per carton. The plaintiff’s claim is well within the limit set by art 4.5. Accordingly judgment was entered for the plaintiff in the sum claim with costs and interest on the judgment sum at the rate of 8% per annum.