Clause Paramount

The effect of the 1971 UK Act, like its predecessor in 1924, was to place the Hague-Visby Rules into Britain’s statute book thus making it a “contracting state”. The majority of countries in the world did something similar. The rules apply to any bill of lading or similar document of title relating to the carriage of goods by sea providing: The bill of lading is issued in a contracting State, OR the carriage is from a port in a contracting State, OR the Contract contained in or evidenced by the Bill of Lading provides that the rules or the legislation of any State giving effect to them are to govern the Contract, whatever may be the nationality of the ship, the carrier, the shipper, the consignee or any other interested person. Those three sub-paragraphs are part of Article X of the Hague-Visby Rules and you will see that the third way for the rules to take effect is if “The Contract…provides that the Rules…are to govern the Contract…” The way in which one ensures the B/L makes that provision is by including a Clause Paramount. The word ‘Paramount’ is used because the effect of such a clause is to make it clear that if there is anything in the B/L which would place the shipper in a worse position than provided for in the Rules then the Rules take precedence over the wording of the B/L in that regard. The Hague/Hague-Visby rules do not apply to charterparties but it is common practice to insert a clause in a C/P stipulating that any B/L’s issued under that charter shall contain a Clause Paramount.