Lloyd's Maritime and Commercial Law Quarterly
Australian maritime law decisions 2000
Martin Davies *
A. Carriage of goods by sea
1. Hi-fert Pty Ltd v. Kiukiang Maritime Carriers Pty Ltd 1
The decision of the Full Court of the Federal Court of Australia rejecting a challenge to the court’s jurisdiction in this case was considered in the 1998 Review.2
In considering the merits of the case, the Federal Court of Australia held that a bill of lading issued by a shipowner evidences a contract of carriage, even though there already exists a contract of carriage (in this case, a contract of affreightment) between the holder of the bill of lading and a time charterer of the carrying ship.
The two plaintiffs were consignor and consignee of a cargo of fertilizer that was to be carried from Tampa, Florida to Newcastle, New South Wales under a contract of affreightment between the Australian consignee, Hi-Fert, and the time charterer of the ship, WBC. The holds of the carrying ship, Kiukiang Career,
were inspected prior to loading in Tampa and were declared to be clean and ready to receive cargo. Nevertheless, on arrival in Australia, the Australian quarantine authorities found wheat residues in the cargo and prohibited its discharge at any Australian port on the basis that it was contaminated with a quarantinable disease known as “karnal bunt”, a disease associated with wheat. The fertilizer was eventually sold elsewhere at a considerable loss. Both plaintiffs sued the shipowner (KMC) for breach of the bills of lading that it had issued after loading in Tampa. Hi-Fert also claimed that the time charterer (WBC) had breached the contract of affreightment but that claim was stayed pending arbitration in London, there being an arbitration clause in the contract.3
KMC argued that it could not be liable in contract to either of the plaintiffs because the bills of lading that it had issued in Tampa did not evidence a contract of carriage between it and either plaintiff, because the receiver, Hi-Fert, already had a contract of affreightment with the time charterer, WBC. KMC said that the bills of lading were intended only to be receipts for the cargo. If KMC had been a party to the contract of affreightment, that
* Professor of Law and Deputy Director, Maritime Law Center, Tulane Law School, New Orleans; Professorial Fellow, University of Melbourne. I am grateful to my colleagues in the Trade and Transport Group of Blake Dawson Waldron for their assistance in preparing this article.
1. (2000) 173 A.L.R. 263.
2. (1998) 90 F.C.R. 1; 159 A.L.R. 142 (F.C.F.C.A), considered at [1999] LMCLQ 406, 415. The jurisdictional fight culminating in the decision on the merits considered here was a long and tortuous one. There are no fewer than six reported decisions (three at first instance, three on appeal) on jurisdictional aspects of this case: see [1999] LMCLQ 406, 415, 416, fns 56, 57.
3. See supra,
fn. 2. Hi-Fert also claimed that misrepresentations made by WBC were a breach of a duty of care in tort and amounted to misleading or deceptive conduct under the Trade Practices Act 1974 (Cth), s. 52. Those claims against WBC were not stayed, but they failed before Tamberlin, J., for the reason that Hi-Fert had not in fact relied on the representations made by WBC.
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