567. Sevylor Shipping and Trading Corp v Altfadul Company for Foods, Fruits & Livestock and SIAT (Societa Italiana Assicurazioni e Reassicurazioni S.p.A. (the “Baltic Strait”) [2018] EWHC 629 (Comm)

Bill of lading holder entitled to full damages from ship owners for damaged cargo irrespective of compensation received from sellers in terms of separate contract of sale.

The facts

Bills of lading issued by the master of the vessel, a refrigerated cargo ship, acknowledged shipment at Guayaquil, Ecuador, in apparent good order and condition of 249,250 boxes of fresh bananas for carriage to Libya. The cargo deteriorated during the carriage and was discharged at Tripoli in that damaged condition. Altfadul, the consignee, received the cargo in its damaged state.

The difference between the value of the cargo as in fact discharged and its value had it been sound on arrival, was US$4,567,351.

Altfadul rejected the cargo, under the contract of sale and claimed a refund of the price.

The seller, CoMaCo. S.p.A., was also the charterer of the vessel under a voyage charter on the Gencon form with additional clauses. The bills of lading were on the Congenbill form issued for use with the Gencon form of charter. They referred to and incorporated the terms and conditions, liberties and exceptions of the voyage charter, including its arbitration clause.

CoMaCo agreed a credit of US$2,586,105.09 in favour of Altfadul, to be spread over three subsequent shipments.

SIAT was the cargo insurer, at the instance of CoMaCo.

Altfadul, as holder, assigned its rights under the bill of lading to CoMaCo who assigned them to SIAT.

Ship owners claimed that damages had to be reduced by the credit given by CoMaCo ie US$ 2 586 105.

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