Under Article III rule 1 of the Hague Rules (which apply to contracts of carriage), the carrier shall be bound, before and at the beginning of the voyage, to exercise due diligence to make the ship seaworthy. In the recent case of Alize 1954, CMA CGM SA v Allianz Elementar Versicherungs AG and Others  EWHC 481 (Admlty), the Admiralty Court of the United Kingdom (the “Court”) considered that the seaworthiness of a vessel extends to have in place an adequate passage plan at the beginning of the voyage to ensure that the vessel is reasonably fit to carry the cargo safely to the destination.
On 17 May 2011, the CMA CGM LIBRA (the “Vessel”), a container vessel, grounded whilst leaving the port of Xiamen, China on a shoal in an area outside the buoyed fairway which carried the risk of uncharted shoals. The owners of the Vessel (the “Ship-owners”) funded the salvage and claimed general average (a claim under the York-Antwerp Rules which allows sharing of loss in an unfortunate incident involving carriage of cargo in the maritime practice) against the owners of the cargo on the Vessel (the “Cargo Interests”). 8% of the Cargo Interests refused to pay their contributions to the general average on the ground of the Ship-owners’ actionable fault in breach of Article III rule 1 of the Hague Rules, by alleging that the cause of the casualty was the unseaworthiness of the Vessel due to the failure to put in place an adequate passage plan and that due diligence was not exercised to make the Vessel seaworthy.
As a general rule, there can only be actionable fault within the meaning of the York-Antwerp Rules which discharges the Cargo Interests from liability to contribute in general average if the grounding was caused by a failure by the Ship-owners to exercise due diligence to make the Vessel seaworthy. The burden of proof lies on the Cargo Interests to establish unseaworthiness which caused the grounding, which then shifts to the Ship-owners to establish that due diligence has been exercised to make the Vessel seaworthy.
Article III rule 1 of the Hague Rules places a seaworthiness obligation upon the carrier “before and at the beginning of the voyage”. The usual test of unseaworthiness is whether a prudent owner would have required the relevant defect, had he known of it, to be made good before sending his ship to sea. (The Cape Bonny  1 Lloyd’s Reports 356 and Scrutton on Charterparties and Bills of Lading 23rd.ed.) Seaworthiness extends to having on board an adequate passage plan at the beginning of the voyage to ensure that the Vessel is reasonably fit to carry the cargo safely to its destination.
The Court considered that mariners would ordinarily regard the charted depths as shown on the passage plan as being accurate. It would therefore be necessary to ensure that, when the navigator of a vessel leaving Xiamen was faced with a decision whether to remain within the buoyed fairway or to navigate outside the buoyed fairway, he had in mind the warning that charted depths outside the buoyed fairway might be unreliable. Prudent passage planning required the danger created by the presence of numerous depths less than those charted outside the fairway to be noted on the Admiralty chart.
In the present case, the Admiralty chart did not contain any direct warning to ensure that the navigator was aware of the danger created by the numerous depths in the approaches to the port in Xiamen which were less than the charted depths. Expert evidence showed that there ought to have been noted on the Admiralty chart that any area outside the charted fairway was a “no go” area. The Court held that the facts that (i) the Vessel carried an Admiralty chart which the officer failed to correct to ensure that it was up to date and (ii) the Vessel carried a passage plan which was defective as it lacked an appropriate warning of “no go” areas, were aspects of the Vessel’s documentations which were capable of rendering the Vessel unseaworthy at the beginning of the voyage. A prudent owner would have insisted on the correction of such a defective passage plan before the voyage was commenced. Therefore, the Vessel was held to be unseaworthy at the beginning of the voyage.
Following the establishment of unseaworthiness, the Cargo Interests had to prove that such unseaworthiness was causative of the grounding of the Vessel.
The Notice to Mariners issued in December 2010 contained both a warning to mariners that it was unsafe to rely upon charted depths and advice as to the least depth in the fairway. An ordinarily prudent mariner should have understood that it is safe to navigate within the fairway having regard to there being a certain least depth but not outside the fairway where no information was given as to the least depth and where there were numerous depths less than those charted. The Court considered that the decision of the master of the Vessel (the “Master”) to depart from the passage plan and to navigate outside of the buoyed fairway was negligent, being a decision which a prudent mariner would not have taken.
From examining the facts of the present case, it was considered that the Master did not have in mind the contents of the Notice to Mariners when he navigated away from Xiamen. The Court thus held that it was more likely than not that the defect in the passage plan was causative of the Master’s decision to leave the buoyed fairway, which was where the Vessel grounded on an uncharted shoal.
Article IV rule 1 of the Hague Rules provides that neither the carrier nor the ship shall be liable for loss or damage arising or resulting from unseaworthiness unless it was caused by the want of due diligence on the part of the carrier to make the ship seaworthy in accordance with Article III rule 1 of the Hague Rules.
Scrutton on Charterparties and Bills of Lading 23rd.ed. further elaborates that the above imposes an inescapable personal obligation on the ship-owners. The due diligence required is the due diligence by the carrier and all persons, whether servants or agents or independent contractors whom he employs or engages in the task of making the ship seaworthy, and cannot be discharged by engaging competent experts to perform such tasks on his behalf. The Court further rejected the allegation by the Ship-owners that it had exercised due diligence to make the ship seaworthy by implementing a safety management system. The Court provided that the Ship-owners must show that the servants or agents relied upon by the Ship-owners to make the Vessel seaworthy before and at the beginning of the voyage had exercised due diligence. The level of standard required is the common law duty of care, i.e. the exercise of reasonable care and skill.
The present case involved failure to prepare an appropriate passage plan. The Court held that with exercise of due diligence, an appropriate passage plan with a warning about the unreliability of the charted depths out of the fairway should have been prepared, in order to minimise the risk that the mariner navigating the Vessel might decide to navigate outside the buoyed fairway.
By reasons of the above, the Court held that the vessel was unseaworthy before and at the beginning of the voyage from Xiamen as it carried a defective passage plan, which was causative of the grounding of the Vessel. The Ship-owners did not exercise due diligence to make the Vessel seaworthy as reasonable skill and care were not shown in the preparation of the passage plan. Accordingly, the grounding of the Vessel was caused by the actionable fault of the Ship-owners and thus the Cargo Interests were not liable to contribute in general average. The case serves as a reminder to ship-owners of the utmost importance of careful passage planning by the relevant navigational officers on the Vessel before commencement of the voyage.
Need legal advice?
For enquiries, you can conduct fast legal advice with experienced lawyers in Hong Kong.With fast legal advice and a fixed fee, you can consult an experienced lawyer on the phone within two days to get to know your legal issues and provide legal advice.
This article was originally published on ONC Lawyers.
This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. If you require any advice or information, please speak to a practicing lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of Interstellar Group Pte. Ltd. accepts or assumes responsibility, or has any liability, to any person in respect of this article.