General Feeds Inc v Slobodna Plovidba (The “Krapan I“) - QBD (Com Ct) (Colman J) - 12 March 1997

Cargo claim brought by receivers settled by shipowners - Shipowners seeking damages from charterers in amount of settlement - Whether settlement reasonable - Whether arbitrators erred in law

The vessel Krapan 1 was chartered on the Gencon form for the carriage of a cargo of bagged anti-oxidant treated fishmeal from Peru to China. The cargo arrived damaged by fire, heat and smoke. Chinese insurers for the cargo receivers advanced a claim against the shipowners for damages totalling US $2.4 million on the basis that the damage had been caused by bad stowage. The shipowners contended that the overheating and fire had been caused by the condition of the cargo at the time of shipment by reason of the fact that the cargo had not been sufficiently anti-oxidant treated. In the event, the shipowners’ P & I Club settled the claim with the cargo insurers for US $600,000.