Ceres Stevedoring Co. Ltd. v. Sears Ltd. and Reichold Ltd. and Others (The Tolya Komar) - Fed.Ct. of Appeal (Desjardins, Pratte and Lacombe JJ.) - 9 June 1988

Himalaya clause - Ratification after occurrence of loss - Whether effective - Established principles considered

Two offset printing presses, shipped under clean bills of lading on the vessel Tolya Komar for a voyage from Bremen, West Germany to Montreal, were damaged after discharge while resting in shed 66 at the Port of Montreal, prior to delivery to owners. The bills of lading exempted the carriers from liability arising out of the negligence of the stevedores. Furthermore, the bills contained a Himalaya clause, but the trial judge rejected the applicability of the clause to the stevedores on the basis that they had not shown that the carriers had contracted for the benefit of the exemption clauses as their agents with their authority or later ratification, (the third requirement laid down by Lord Reid in Midland Silicones Ltd. v. Scruttons Ltd. [1962] A.C. 446 at 474. He held the stevedores liable for a total agreed amount of £205,500.