442. Owners of Cargo on Board the Morviken v Owners of the Hollandia [1983] 1 A.C. 565

HVR compulsorily applicable – package limitation not defeated by choice of law or forum clauses

 The facts

 At Leith in Scotland shippers shipped a road-finishing machine on board a Dutch vessel for carriage to Bonaire in the Dutch West Indies.

 The bill of lading issued by the carriers specified that the law of the Netherlands applied to the contract and that the carriers’ maximum liability per package was D.fl. 1,250 (about £250). All actions under the contract of carriage were to be brought before the Court of Amsterdam and that no other court was to have jurisdiction in any such action unless the carriers elected otherwise.

 The machine was transhipped in Holland on to the Morviken, a Norwegian vessel, for carriage to Bonaire. While it was being unloaded at Bonaire the machine was dropped and severely damaged.

 The shippers estimated the damage at about £22,000, and brought an action in rem against the Hollandia, a ship belonging to the carriers, claiming from the carriers damages for breach of contract and negligence in the care and discharge of the cargo on board the Morviken .

 On the carriers’ application for a stay of the action on the ground that the action could only be brought in Amsterdam, where under Dutch law, which at the date of issue of the bill of lading still recognised the Hague Rules, the liability would be limited to the amount specified in the bill of lading, the shippers relied on the Hague-Visby Rules, Article IV, paragraph 5 of which set a limit of liability of about £11,000.

 Findings

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