- The English High Court recently held in FIM Bank PLC v KCH Shipping Co., Ltd (“FIM Bank v KCH”)i that the one-year time limit for cargo claims provided in the Hague-Visby Rules also applied for mis delivery claims. The Bills of Lading (“B/L”) issued in FIM Bank v KCH were Congen B/Lsii which incorporated the terms of the Charterparty into the B/Ls. The English High Court held in FIM Bank v KCH Shipping that
- Art III r 6 of the Hague Visby Rules, which includes the time limit applied, as a matter of construction of the Article, to claims for mis delivery of cargo after dischargeiii.
- Even if the above conclusion was wrong, the one-year time limit for mis delivery after discharge would apply as an implied termiv.
Given that the time bar defence is perhaps the most important procedural defence in relation to cargo claims, we wanted to reconsiderv its implication to Liner B/Ls.
- Time bar:
- The first issue we need to consider is whether time bar is either a procedural (lex fori) or a substantive law (lex causae) defence. Under English law, there is no barrier to the freedom of parties to contractually agreeing to a time limit that is shorter than that provided in the limitation statuevi. Additionally, English Common law has traditionally considered time bars to be of a procedural nature which may not necessarily true in other jurisdictions. The reason why we bring this out is that the ambit of the Hague/Hague-Visby Rules time limit if extended after its period of coveragevii may override the compulsorily applicable provisions in the place where the matter is being heardviii.
- Singapore has legislated for time bar provisions to be based on the applicable law of the contractix. If the law of the contract (B/L) is English Lawx, we submit that based on FIM Bank v KCH Shipping, Singapore courts should hold for the one-year time bar to apply. However, if the law of the contract (B/L) is Singapore Law, we then submit, based on Press Automation Technology v Trans-Link Exhibition Forwardingxi, that the Singapore courts would deny the application of the one-year time bar for the period before loading and after discharge.
- Liner B/Ls have a plethora of clauses including terms which clearly provide for the period of responsibility together with the time bar provisions. In this regard, we have considered the relevant clauses of Maersk Linexii, MSCxiii and TTxiv Series 100 Bills of Lading which are as follows:
- Clause 5 of the B/L deals with the responsibility of the Carrier and which incepts from the time of acceptance of custody of the goods at the port of loading till the time of tendering the goods for delivery at the port of dischargexv.
- Clause 9 of the B/L deals with time bar and which provides for one year from the date of delivery or the date when goods should have been deliveredxvi.
- Clause 5(a) of the B/L provides for the period of responsibility from the time goods are loaded on board till the time they have been discharged from the vesselxvii.
- Clause 10(2) of the B/L provides for one-year time bar for port-to-port shipments and 9 months’ time bar for multimodal shipmentsxviii.
- TT Series 100 amended wordings
- Clause 6(3) of the B/L provides for the period of responsibility from and during loading up to and during discharge of the cargoxix.
- Clause 6(5)(G) deals with the time bar provision and which provides for nine months after delivery or the date when the goods should have been deliveredxx.
- While the Maersk B/L terms provide for wider responsibility incepting prior to loading and discharge, both the MSC and the amended TT Series 100 Bills of Lading provide for limited responsibility of the Carrier i.e., from the time of loading to the time of discharge. With respect to time bar, both Maersk and MSC provide for one year time bar while the amended TT Series 100 provides for 9 months. Given the wide variety of wordings in Liner B/Ls, we submit that the application of time bar for the before and after period would therefore depend on the wordings of the B/L’s, applicable law of the contract together with the court seized of the issue.
- To conclude, the application of the 1-year time bar for mis delivery claims, as stated in FIM Bank PLC v KCH Shipping Co., cannot be considered as a general rule and it would depend on the clauses in the B/Ls including the law of the contract and the jurisdiction where this matter is being dealt at.
We thank Dr Arun Kasi of Arun Kasi & Co for reviewing this article. The views expressed in this article together with all errors are entirely ours.
i. Fimbank Plc v KCH Shipping Co., Ltd  EWHC 2400 (Comm) (28 September 2022) (bailii.org)
iii. Para 93 of the judgment.
iv. Para 94 of the judgment.
v. We had earlier written on this topic and which can be viewed at Mis-delivery of cargo – Time bar – NAU Pte Ltd
vi. Limitation Act 1980
vii. See Art 1(e) of the Hague / Hague Visby Rules and which states “Carriage of goods” covers the period from the time when the goods are loaded on to the time they are discharged from the ship.
viii. For instance, both in India and Malaysia, the Indian Contract Act 1872/ Malaysian Contract Act 1950 together with the Limitation Act 1953 (for Malaysia)/1963 (for India) would result in the denial of the 1 year time bar for periods outside the carriage of goods – see our earlier article – Standard Trading Conditions – Time Bar & Limitation of Liability Clauses.
ix. Foreign Limitation Periods Act 2012
x. Most of the Bs/L generally provide for English Law.
xi.  SGHC 286 (elitigation.sg)
xii. Maersk Line
xiv. TT Club
xv.Where the Carriage is Ocean Transport, the Carrier undertakes to perform and/or in his own name to procure performance of the Carriage from the Port of Loading to the Port of Discharge. The liability of the Carrier for loss of or damage to the Goods occurring between the time of acceptance by the Carrier of custody of the Goods at the Port of Loading and the time of the Carrier tendering the Goods for delivery at the Port of Discharge shall be determined in accordance with Articles 1-8 of the Hague Rules save as is otherwise provided in these Terms and Conditions. These articles of the Hague Rules shall apply as a matter of contract.
xvi.Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the Carrier or his agents at the Place of Delivery (or Port of Discharge if no Place of Delivery is named on the reverse hereof) before or at the time of removal of the Goods or if the loss or damage is not apparent within three days thereafter, such removal shall be prima facie evidence of the delivery by the Carrier of the Goods as described in this bill of lading. In any event, the Carrier shall be discharged from all liability whatsoever in respect of the Goods unless suit is brought within one year after their delivery or the date when they should have been delivered.
xvii.If carriage under this Bill of Lading is Port-to-Port: (a) The period of responsibility of the Carrier for any loss of or damage to the Goods shall commence only at the moment that the Goods are loaded on board the Vessel and shall end when the Goods have been discharged from the Vessel
xviii.Time bar – In any event, the Carrier shall be discharged from all liability if suit is not commenced within one (1) year after delivery of the Goods or the date that the Goods should have been delivered for claims related to loss or damage during the Port-to-Port carriage, and for claims related to loss or damage during Inland Transport the shorter of nine (9) months or any time limit provided for by any applicable international convention, national law, regulation or contract by virtue of clauses 5.2.2 (a) or (b).
xix.The responsibility of the Carrier is limited to that part of the Carriage from and during loading onto the vessel upto and during discharge from the vessel and the Carrier shall not be liable for any loss or damage whatsoever in respect of the Goods or for any other matter arising during Carriage even though Charges for the whole Carriage have been charged by the Carrier. Where there is no national law making the Hague Rules, Hague Visby Rules ….
xx.The Carrier shall be discharged of all liability unless suit is brough in the proper forum and written notice thereof received by the Carrier within nine months after delivery of the Goods or the date when the Goods should have been delivered. In the event that such time period shall be found contrary to any convention or law compulsorily applicable, the period prescribed by such convention or law shall then apply but in that circumstance only.
The time bar appears to be applicable “from the date of delivery” or “the date when the goods should have been delivered”, according to most B/L Terms and Conditions – or the like.
A holder of the Bill of Lading often cannot know (a) when the goods were delivered. (b) when the goods ought to have been delivered, rather the Liner Bills of Lading themselves specify that there is no committed delivery date.
So how is the shipper then required to know what is time bar is? One view is that the actual delivery date to be taken; whether that was known or unknown to the OBL holder.
The next question as to what is the meaning of ‘delivery’? There are multiple transfers of cargo possession at the discharge port. From vessel to stevedore to Port to trucking companies to CFS / warehouse to private party to another private party. Which of these constitutes the delivery as none are holders of the OBL. Which of these deliveries triggers the one year reckoning.
Thank you for your comments. My thoughts on the points raised are as below
(a) when the goods were delivered:
Prior to delivery, the holder of the BL would have to surrender the BL. In most ports, there would be additional requirements such as taking the Delivery Order or providing authorisation to electronically transfer to the haulier. Provided these requirements have been fulfilled, it would appear that the delivery has been effected. While an argument can certainly be made that this should await the physical movement of the container/cargo, the fact is that once the electronic authroisation has been provided say in the port system, the Carrier has no further control on the container / cargo.
(b) when the goods ought to have been delivered, rather the Liner Bills of Lading themselves specify that there is no committed delivery date:
I believe that this would be a question of fact. Provided the goods have reached the destination and delivery has not been taken by the cargo interests, then this should be probably answered on when cargo interests would normally be able to take delivery.
(c)The next question as to what is the meaning of ‘delivery’? There are multiple transfers of cargo possession at the discharge port. From vessel to stevedore to Port to trucking companies to CFS / warehouse to private party to another private party. Which of these constitutes the delivery as none are holders of the OBL. Which of these deliveries triggers the one year reckoning:
I believe that we should look at the immediate contractual relationship and transfer. So if the movement (stevedoring/ transportation)is accomplished by the Carrier by themseleves without any subsidiary agreement, then delivery has not taken place . However, if the cargo has been transferred, say due to the surrender of the Bills of Lading, then the Carrier is no longer in control and this is the point I would suggest that delivery would have taken place.
Trust this assists.
I am a student preparing for a moot on shipping law and we have a misdelivery claim in the problem. the hague visby rules apply after discharge although there is no authority on what constitutes delivery. could you please help me out wrt figuring out the delivery bit? i cannot look to delivery order or B/L since its a claim of misdelivery and everything is happening without a B/L.
Hi – why don’t you write to me at Jagan@nau.com.sg – i will be happy to answer your queries.