Presentation Transcript

1. Concept of Delay in Maritime and Transport Law

   Olena Bokareva JASN06 International Law on Shipping and Trade September 14, 2012 Lund University
2. Useful Material John E. Stannard. Delay in the Performance of Contractual Obligations, OUP, 2007 Max Ganado & Hugh M. Kindred, Marine CargoDelays, LLP, 1990 Carver’sCarriage by Sea, 1971 (Chapter on Deviation and Delay, pp.865-899) Kurt Grönfors. “Liability for Delay in Combined Transport”. 5 JMLC, 1973-1974 Kurt Grönfors. Tidsfaktornvidtransportavtal, Akademiförlaget, 1974 (in Swedish)
3. Time in Performance of Commercial Obligations SaleContract: the time for delivery is normallyfixed by the parties iftheyfail to do that – the deliveryshould be performedwithin a reasonable time (this provision is alsostipulated in the UN Sales Convention 1980, Article 33) What is ”reasonable time” and ”unreasonabledelay”?
4. CISG Article 33 The seller must deliver the goods: (a) if a date is fixed by or determinable from the contract, on that date; (b) if a period of time is fixed by or determinable from the contract, at any time within that period unless circumstances indicate that the buyer is to choose a date; or (c) in any other case, within a reasonable time after the conclusion of the contract.
5. ”Reasonable Time” Reasonableness, as a concept employed in modern legal systems, is both elusive and multifaceted. The word appears in statutes and in precedents. It is written into contracts and wills. It is also an adjective used to qualify other concepts, such as care, cause, time, maintenance, and so forth (MickaelSaltman. The Demise of the ‘Reasonable Man’, ) Reasonable time (in contracts) is defined as the time needed to do what a contract requires to be done, based on subjective circumstances. If the contracting parties do not fix a time for performance, the law will usually presume a reasonable time (Black’s Law Dictionary) The Oxford Companion to Law defines the reasonable man as a “hypothetical creature whose imaginary characteristics and conduct by way of foresight, care, precautions against harm, susceptibility to harm and the like, are frequently referred to as the standard for judging the actual foresight, care, etc of a particular defendant” (Walker, 1980:1038)
6. What is Delay? Black’sLaw Dictionary: ”the period duringwhichsomething is postponed or slowed” Oxford Dictionary: ”a period of time by whichsomething is late or postponed” Is it different from loss and damage? Is delay a type or cause of damage?
7. Delay in commerciallaw  ”Delay in performance is a common difficulty in contracts of all kinds. Delay may amount to a breach, or a defective performance, or a failure to perform. This may be partial , or substantial, or material, or total; it may go to the root of the contract or even to the foundation of the adventure; in an extreme case it may frustrate the contract... The remedy for the delay may be to recover damages, which may be liquidated or unliquidated. In serious cases of delay the promisee may withhold performance, or terminate performance, or rescind the contract, or treat it as repudiated”. (John E. Stannard. Delay in the Performance of Contractual Obligations)
8. Types of LossesDue to Delay Damage to or loss of the goods Progressive damage (perishablegoods) No damage to the goods (financial or economic loss) - the goods are delivered in perfectcondition, buttoo late (seasonalgoods, machinerycomponents for productionchain)
9. Liability for Delay under the Hague-VisbyRules, Article III The Hague-VisbyRuleshave no explicit rules on delay Article III(6) Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage, or, if the loss or damage be not apparent, within three days, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading. Article III(8). Any clause, covenant or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with goods arising from negligence, fault or failure in the duties and obligations provided in this Article or lessening such liability otherwise than as provided in these Rules, shall be null and void and of no effect.
10. Hague-VisbyRules, Article IV Article IV (1). Neither the carrier nor the ship shall be liable for loss or damage arising or resulting from unseaworthiness unless caused by want of due diligence on the part of the carrier to make the ship seaworthy, and to secure that the ship is properly manned, equipped and supplied, and to make the holds, refrigerating and cool chambers and all other parts of the ship in which goods are carried fit and safe for their reception, carriage and preservation in accordance with the provisions of paragraph 1 of Article III. Whenever loss or damage has resulted from unseaworthiness the burden of proving the exercise of due diligence shall be on the carrier or other person claiming exemption under this article. Article IV(2). Neither the carrier nor the ship shall be responsible for loss or damage arising or resulting from: Article IV(3). The shipper shall not be responsible for loss or damage sustained by the carrier or the ship arising or resulting from any cause without the act, fault or neglect of the shipper, his agents or his servants. Article IV (4). Any deviation in saving or attempting to save life or property at sea or any reasonable deviation shall not be deemed to be an infringement or breach of these Rules or of the contract of carriage, and the carrier shall not be liable for any loss or damage resulting therefrom. Article IV(5)(a) limitation amounts for loss or damage to the goods – 666,67 units of accountper package or unit or 2 units of account per kilo of gross weight of the goods lost or damaged
11. Hague-VisbyRules, cont. Anglo-Saxon Petroleum Co. Ltd v. Adamastos Shipping Co.Ltd[1957], 2 W.L.R. Did the words ”loss or damage” relateonly to physical loss of or damage to goods? JudgeDevlin: ”The Act (US COGSA 1936) is dealing with responsibilities and liabilities under contracts of carriage of goods by sea; and clearlysuchcontractualliabilities are not limited to physicaldamage. A carriermay be liable for loss caused to the shipper by delay or misdelivery, eventhough the goodsthemselves are intact. I cansee no reasonwhy the general words ”loss or damage” should be limited to physical loss or damage. Citing the Rentonv.Palmyra Trading Corporation of Panama, [1957],2 W.L.R, J. Devlinstates that House of Lords held: ”The words ’loss or damage to or in connection with goods’ in Art.III(8) of the HR were not limited to actual loss of or physicaldamage to the goods”. Hefurtheradds that: ”I shouldgive the same meaning to ’in relation to’ as to ”in connection to’”.
12. Hague-VisbyRules, Article V “A carrier shall be at liberty to surrender in whole or in part all or any of his rights and immunities or to increase any of his responsibilities and obligations under these Rules, provided such surrender or increase shall be embodied in the bill of lading issued to the shipper.”
13. Hamburg Rules Intriducesliability for delay for the first time Article 5: 1. ”The carrier is liable for loss resulting from loss of or damage to the goods, as well as from delay in delivery” 2. Delay in delivery occurs when the goods have not been delivered at the port of discharge provided for in the contract of carriage by sea within the time expressly agreed upon or, in the absence of such agreement, within the time which it would be reasonable to require of a diligent carrier, having regard to the circumstances of the case. 3. The person entitled to make a claim for the loss of goods may treat the goods as lost if they have not been delivered as required by article 4 within 60 consecutive days following the expiry of the time for delivery according to paragraph 2 of this article. Article 6(1)(b) The liability of the carrier for delay in delivery according to the provisions of article 5 is limited to an amount equivalent to two and a half times the freight payable for the goods delayed, but not exceeding the total freight payable under the contract of carriage of goods by sea.
14. Conversion Black’sLaw Dictionary: ”There are threedistincmethods by whichonemaydepriveanother of his property, and so be guilty of a conversion and liable – 1. by wronglytaking it, 2. by wronglydeteining it, and 3. by wronglydisposing of it. To convertgoodsmeant to dispose of them, or make away with them, to deal with them, in such a way that neitherowner nor wrondoerhadanyfurther possession of them (by consumingthem or destroying, by sellingthem or deliveringthem to somethird person)
15. Delay and Deviation Obligation of reasonabledispatch Obligation not to deviate from the agreed route Deviation – ’an intentional and unreasonablechange in the geographical route of the voyage as contracted’ (Tetley. Marine CargoClaims, 3rd ed., p . 737) Delay is a breach in time whilegeographical deviation is a breach in space (Ganado & Kindred. Marine CargoDelays, p. 7)
16. Delay in Multimodal Transport Increasingimportance of timelydelivery in door-to-doortransportationdue to ”Just in Time” concept Difficulties to localisedelay in multimodal transport Whatwas the primary cause of delay and whatcontributed to the final delay?
17. Transport Conventions CMR, Articles 17 -20 CIM-COTIF, Article 23 Montreal Convention, Article 19 CMNI, Articles 3, 5, 16, 20
18. CMR Article 17 1. The carrier shall be liable for the total or partial loss of the goods and for damage thereto occurring between the time when he takes over the goods and the time of delivery, as well as for any delay in delivery. Article 18 1. The burden of proving that loss, damage or delay was due to one of the specified in article 17, paragraph 2, shall rest upon the carrier. Article 19 Delay in delivery shall be said to occur when the goods have not been delivered within the agreed time-limit or when, failing an agreed time-limit, the actual duration of the carriage having regard to the circumstances of the case, and in particular, in the case of partial loads, the time required for making up a complete load in the normal way, exceeds the time it would be reasonable to allow a diligent carrier. Article 20 1. The fact that goods have not been delivered within thirty days following the expiry of the agreed time-limit, or, if there is no agreed time-limit, within sixty days from the time when the carrier took over the goods, shall be conclusive evidence of the loss of the goods, and the person entitled to make a claim may thereupon treat them as lost.
19. CIM-COTIF Article 23 §1: “The carrier shall be liable for loss or damage resulting from the total or partial loss of, or damage to, the goods between the time of taking over of the goods and the time of delivery and for the loss or damage resulting from the transit period being exceeded, whatever the railway infrastructure used”. Article 29 § 1 (Presumption of loss of the goods) The person entitled may, without being required to furnish further proof, consider the goods as lost when they have not been delivered to the consignee or placed at his disposal within thirty days after the expiry of the transit periods. Limitation of liability – 17 units of account per kilogramme of gross mass short. Article 33§ 1 If loss or damage results from the transit period being exceeded, the carrier must pay compensation not exceeding four times the carriage charge.
20. Montreal Convention Article 19 - Delay The carrier is liable for damage occasioned by delay in the carriage by air of passengers, baggage or cargo. Nevertheless, the carrier shall not be liable for damage occasioned by delay if it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for it or them to take such measures. Article 22 - Limits of liability in relation to delay, baggage and cargo 1. In the case of damage caused by delay as specified in Article 19 in the carriage of persons, the liability of the carrier for each passenger is limited to 4,150 Special Drawing Rights. 2. In the carriage of baggage, the liability of the carrier in the case of destruction, loss, damage or delay is limited to 1,000 Special Drawing Rights for each passenger unless the passenger has made, at the time when the checked baggage was handed over to the carrier, a special declaration of interest in delivery at destination and has paid a supplementary sum if the case so requires. In that case the carrier will be liable to pay a sum not exceeding the declared sum, unless it proves that the sum is greater than the passenger's actual interest in delivery at destination. 3. In the carriage of cargo, the liability of the carrier in the case of destruction, loss, damage or delay is limited to a sum of 17 SDR per kilogram, unless the consignor has made, at the time when the package was handed over to the carrier, a special declaration of interest in delivery at destination and has paid a supplementary sum if the case so requires. In that case the carrier will be liable to pay a sum not exceeding the declared sum, unless it proves that the sum is greater than the consignor's actual interest in delivery at destination. 4. In the case of destruction, loss, damage or delay of part of the cargo, or of any object contained therein, the weight to be taken into consideration in determining the amount to which the carrier's liability is limited shall be only the total weight of the package or packages concerned. Nevertheless, when the destruction, loss, damage or delay of a part of the cargo, or of an object contained therein, affects the value of other packages covered by the same air waybill, or the same receipt or, if they were not issued, by the same record preserved by the other means referred to in paragraph 2 of Article 4, the total weight of such package or packages shall also be taken into consideration in determining the limit of liability.
21. CMNI Article 3 The carrier shall carry the goods to the place of delivery within the specified time. Article 5 The carrier shall deliver the goods within the time limit agreed in the contract of carriage or, if no time limit has been agreed, within the time limit which could reasonably be required of a diligent carrier, taking into account the circumstances of the voyage and unhindered navigation. Article 16 The carrier shall be liable for loss resulting from loss or damage to the goods caused between the time when he took them over for carriage and the time of their delivery, or resulting from delay in delivery, unless he can show that the loss was due to circumstances which a diligent carrier could not have prevented and the consequences of which he could not have averted. Article 20 In the event of loss due to delay in delivery, the carrier’s liability shall not exceed the amount of the freight. However, the aggregate liability under paragraph 1 and the first sentence of the present paragraph shall not exceed the limitation which would be established under paragraph 1 for total loss of the goods with respect to which such liability was incurred.
22. Multimodal Convention Article 16 - Basis of liability 1. The multimodal transport operator shall be liable for loss resulting from loss or damage to the goods, as well as from delay in delivery, if the occurrence which caused the loss, damage or delay in delivery took place while the goods were in his charge as defined in article 14, unless the multimodal transport operator proves that he, his servants or agents or any other person referred to in article 15 took all measures that could reasonably be required to avoid the occurrence and its consequences. 2. Delay in delivery occurs when the goods have not been delivered within the time expressly agreed upon or, in the absence of such agreement, within the time which it would be reasonable to require of a diligent multimodal transport operator, having regard to the circumstances of the case. 3. If the goods have not been delivered within 90 consecutive days following the date of delivery determined according to paragraph 2 of this article, the claimant may treat the goods as lost.
23. UNCTAD/ICC Rules 5.2. Delay in delivery Delay in delivery occurs when the goods have not been delivered within the time expressly agreed upon or, in the absence of such agreement, within the time which it would be reasonable to require of a diligent MTO, having regard to the circumstances of the case. 5.3. Conversion of delay into final loss If the goods have not been delivered within ninety consecutive days following the date of delivery determined according to Rule 5.2., the claimant may, in the absence of evidence to the contrary, treat the goods as lost.
24. MULTIDOC 95 III. LIABILITY OF THE MTO 10. Basis of Liability (a) The responsibility of the MTO for the Goods under this Contract covers the period from the time the MTO has taken the Goods into his charge to the time of their Delivery. (b) Subject to the defenses set forth in Clauses 11 and 12, the MTO shall be liable for loss of or damage to the Goods as well as for delay in Delivery, if the occurrence which caused the loss, damage or delay in Delivery took place while the Goods were in his charge as defined in sub-clause 10 (a), unless the MTO proves that no fault or neglect of his own, his servants or agents or any other person referred to in sub-clause 10 (c) has caused or contributed to the loss damage or delay in Delivery. However, the MTO shall only be liable for loss following from delay in Delivery if the Consignor has made a written declaration of interest in timely Delivery which has been accepted in writing by the MTO. (c) The MTO shall be responsible for the acts and omissions of his servants or agents, when any such servant or agent is acting within the scope of his employment, or of any other person of whose services he makes use for the performance of the Contract, as if such acts and omissions were his own. (d) Delay in Delivery occurs when the Goods have not been delivered within the time expressly agreed upon or, in the absence of such agreement, within the time which it would be reasonable to require of a diligent MTO, having regard to the circumstances of the case. (e) If the Goods have not been delivered within ninety (90) consecutive days following the date of Delivery determined according to Clause 10 (d) above, the claimant may, in the absence of evidence to the contrary, treat the Goods as lost.
25. Rotterdam Rules Article 21 Delay Delay in delivery occurs when the goods are not delivered at the place of destination provided for in the contract of carriage within the time agreed. Article 60 Limits of liability for loss caused by delay Subject to article 61, para.2, compensation for loss of or damage to the goods due to delay shall be calculated in accordance with article 22 and liability for economic loss due to delay is limited to an amount equivalent to two and one-half times the freight payable on the goods delayed. The total amount payable pursuant to this article and article 59, para.1, may not exceed the limit that would be established pursuant to article 59, para.1 in respect of the total loss of the goods concerned.
26. Economic Loss Remoteness of damage – Hadley v. Baxendale [1854] In English law the position has been that economic loss that is too remote is not compensable However, since the decision of the House of Lord in Junior Books v. Veitchi, an economic loss can be compensated if there is a ”special relationship” between the parties in question. Losses that do not qualify under this doctrine are often refer to as “secondary” or “relational”; in other words, they are just too remote to be compensable.