Introduction
In addition to the duty as a bailee to care for the cargo, a shipowner (including a contractual carrier) is also under an obligation to care for the cargo pursuant to Article III Rule 2 of the Hague or Hague-Visby Rules, which states:
“Subject to the provisions of Article IV, the carrier shall properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried”.
Article IV relates to exceptions that essentially exculpate a carrier from liability in the event of cargo being damaged as a consequence of circumstances beyond the carrier’s control and are the subject of a separate paper in its own right.
It is worth noting that Article IV Rule 2(a) (error in the management of the vessel, also known as crew negligence) does not apply to a failure to care for the cargo. Crew negligence is not a defence qua cargo.
A failure to care for cargo can take many forms, for example, failing to monitor reefer containers, or failing to implement adequate security to prevent theft of the cargo whilst on board a vessel.
For present purposes, let us look at how the obligation to care for the cargo works specifically in relation to the need to ventilate cargoes, using grain cargo as an example.
Ventilating Grain Cargoes
A frequent type of damage to a cargo of grain is mould and deterioration caused by inadequate ventilation during transit.
Grain cargoes are naturally hygroscopic1 and unless water vapour released by the cargo is removed from the holds by ventilation, it will condense on the internal steel structure of the ship and drip back on to the cargo surface as water droplets, giving rise to cargo spoilage.
A good analogy is to think of taking a hot shower on a cold day – don’t forget to open the bathroom window afterwards!
A situation can arise when allowing the ambient air into a cargo space which can be injurious to the cargo. If the humidity of the air outside of the cargo space is higher than the humidity of the air inside, ventilation will worsen the conditions inside the holds.
It is therefore necessary to monitor the conditions inside the cargo holds during the voyage and to compare them with the ambient conditions. That is the only sure-fire way to ensure that the cargo is being cared for properly. On a well-managed ship, records of observations of the dew point temperatures2 of both the cargo hold and ambient air temperatures will be maintained.
When (And When Not) To Ventilate
The rule is as follows:
If the dew point temperature inside the hold is greater than the dew point temperature of the ambient air, ventilate.
Conversely, if the dew point temperature of the ambient air is greater than the dew point temperature inside the hold, restrict cargo ventilation.
Monitoring the dew point temperatures can be a rather mundane task. It involves a crew member entering the cargo space (observing procedures relating to the entry of enclosed spaces on ships to ensure safety of personnel) and using a device known as a psychrometer3 to measure the dew point temperature. Alternatively, remote sensors can be used.
Ideally, this monitoring should be carried out every six hours and more frequently if the ambient conditions are observed to be altering rapidly.
Three Degree Rule
Where it is impracticable to measure hold dewpoint temperatures accurately, or at all, ventilation requirements can be estimated by comparing the average cargo temperature at the time of loading with the prevailing ambient air temperature. The following rule may then be applied
Ventilate if the dry bulb temperature of the ambient air is at least 3°C cooler than the average cargo temperature at the time of loading.
Conversely, restrict ventilation if the dry bulb temperature of the ambient air is either warmer than, or less than 3°C cooler than, the average cargo temperature at the time of loading.
In order to apply the Three Degree Rule, it is necessary for the crew to take (and record) frequent cargo temperatures during loading.
Common Misconceptions
By far the most common misconception as regards ventilation is that it can only be carried out during the hours of daylight. The decisions concerning ventilation should only be made based on either a comparison of the dew point temperatures, or the implementation of the Three Degree Rule.
It has often been argued that it is not safe for the crew of a ship to venture out on deck during the hours of darkness either to monitor the temperatures inside the holds or to shut down ventilation if required. We disagree. However, the crew of a ship are often called on to perform duties during “the hours of darkness”.
It is also often said and thought that cargo ventilation should not be carried out during periods of rain. Whilst this might appear to be logically obvious, there are circumstances where, even though it is raining, the dewpoint temperature of the air inside the hold is greater than the ambient temperature and ventilation should be carried out. Clearly, steps must be taken to prevent the ingress of rainwater to the hold and cargo hold vents are usually fitted with jalousies4 for that purpose.
Fumigation
Grain cargoes are frequently carried under fumigation, a process of placing fumigant tablets in the cargo that react chemically with water vapour to produce fumigant gas (typically phosphine). Ventilation should be restricted for the first 7-10 days of the voyage before venting off the fumigant gas. It also requires further precautions by the crew to ensure they are not exposed to toxic fumes when entering the cargo spaces during the course of the voyage to monitor the dew point temperatures. It may be that the carrier must obtain specialist advice as to how to properly care for the cargo in these circumstances.
Burden Of Proof
The contractual regime under The Hague Rules or The Hague-Visby Rules does not alter the position in respect of the burden of proof in bailment. In that case, the starting point for any cargo damage claim caused by a failure to care for the cargo is to establish that the cargo was loaded in good condition but arrived in a damaged or deteriorated condition. The claimant then has a sustainable cause of action.
At this point, the legal and evidential burden of proof shifts to the carrier to demonstrate that they have complied with their Art. III (2) obligation to properly and carefully care for the cargo. In the circumstances described above, a claimant would expect to see complete copies of contemporaneous ventilation logs and deck logs that demonstrate that the carrier monitored and recorded temperatures both inside and outside the cargo spaces and did (or did not) ventilate the cargo accordingly.
It is often argued by carriers that wet and/or moisture damage to hygroscopic cargoes, like grain, is caused by an inherent vice (Art. IV (2)(m)) of the cargo. This is on the basis that the moisture that caused the damage came from the cargo itself. However, in order to successfully rely on this defence, it must be proved by the carrier either:
- That the carrier was not negligent. Put another way, the carrier implemented every available measure, taking into account the nature of the cargo, to prevent the damage from occurring (i.e. implemented a sound system to care for the cargo according to market practice), but yet the cargo arrived damaged anyway; or
- That the carrier was negligent but, even if the carrier had implemented a sound system to care for the cargo according to market practice, the cargo would have arrived damaged in any event (i.e. the carrier’s negligence was not causative).
Proving either of the above satisfies the definition of inherent vice in The Hague Rules or the Hague-Visby Rules, being a cargo that is unable to withstand the normal rigours of the contractual voyage5. Of course if the carrier cannot disprove their negligence (or that their negligence was not causative), the negligence will negate the defence.
For more about the burden of proof in cargo claims please see our earlier article on the Supreme Court decision in VOLCAFE v CSAV, here.
Conclusion
Caring for the cargo is a fundamental obligation of a carrier. Issues relating to whether a carrier has discharged this obligation must be considered carefully with the necessary expertise (often requiring the input of a master mariner or scientific expert). The carrier must also make full documentary disclosure of the steps they implemented and making a request for this documentation at an early stage is essential.
The Supreme Court decision in VOLCAFE v CSAV was welcomed by cargo interests and their insurers because it reflects the reality that whilst cargo remains in the custody and care of a carrier, it is the carrier who is best placed to prove whether they have implemented a sound system to care for the cargo and that they have not been negligent in that process.
Every case should be considered on its own facts and if you have any questions in relation to this article, we are happy to assist.
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