A Study on the Allocation of Liability and Burden of Proof between Carrier and Cargo Interests under Maritime Liability Regimes

Abstract

In cases of loss, damage or short delivery of the cargo, cargo claims are brought by cargo interests against carriers. In any cargo claims, allocation of liability should be considered together with the allocation of burden of proof. In practice, obligations and liability in the terms of the contract may often depend on who bears the legal burden of proof. It is crucial to analyse the provisions relevant to the allocation of liability and burden of proof which are the core elements to any maritime liability regimes. Under the maritime liability regimes, the carrier is subject to a number of obligations, breach of which gives rise to liability. The main obligations include a duty to exercise due diligence to make and maintain the vessel seaworthy and the duty to carry, deliver the goods to the consignee during the carrier’s period of responsibility from receipt to delivery of the goods. In contrast to the Hague-Visby Rules, the seaworthiness obligation under the Rotterdam Rules is a continuous one, applying throughout the carriage. Provided that the carrier is under a continuing duty before and throughout the voyage to exercise due diligence and cannot rely on the exception of ‘act, neglect or default in the navigation or management of the ship’, the overall effect of these changes would be radically to shift the balance of risk from cargo interests to carrier. However, this change has received support on the basis that it would be in line with the ISM Code and safe shipping requirements. Furthermore, obligations and liability of the shipper also become more extensive. The provisions in the Rotterdam Rules relating to the burden of proof have been carefully and skilfully constructed. Although the approach taken under the Rotterdam Rules appears similar to the Hague-Visby Rules, the text differs significantly, both in structure and wording. While the cargo claimant must prove loss, damage or delay during the carrier’s period of responsibility, the carrier is relieved of ‘all or part of its liability’, if it can prove ‘absence of fault’ or ‘a listed event or circumstance as a cause or contributory cause’. There is also a special article which may distinguish the Rotterdam Rules from existing liability regimes in terms of the allocation of liability for loss by introducing the principle of proportional liability of the carrier, which would be a potentially substantial difference. Therefore the position under the Rotterdam Rules would be significantly different to the established position under the Hague and Hague-Visby and Hamburg Rules, as a carrier may be relieved of part of its liability.