Dunnaging

The Courts were asked for a preliminary ruling in principle, in advance of the main claim. If the parties had agreed the charterer would pay for the services, was the shipowner still liable for ‘defective loading, stowage, lashing, securing, dunnaging, separation and discharge’, and responsible for ‘proper performance’ of the operations? They had to decide what the parties had actually agreed in the charter and bills of lading, and whether Hague-Visby still applied. In December 1997 Islamic Solidarity Shipping voyage chartered the Jordan II to TCI Trans Commodities to carry 5,500 tonnes of galvanised steel coils from India to Spain, freight to be paid (clause 3) ‘per metric ton FIOST [free in and out, stowed and trimmed] – lashed/secured/dunnaged’. Clause 7 was modified to read: ‘charterers to have full use of all vessel’s gear to assist in loading and discharging’, but only ‘supplementary to the shore gear’. Shore winchmen and cranemen were ‘to be used at all times’. The charter was on a Stemmor 1983 form, designed for the carriage of bulk ore. Clause 17 retained its original wording: the ‘shipper / charterer / receiver’ were to load, ‘trim’ and discharge the cargo ‘free of expense to the vessel’. “Trimming” is defined as “levelling off the top of the pile” – appropriate to ore in bulk, but how was it supposed to apply to steel coils? The charter was subject to English law, and incorporated the Hague-Visby Rules. The shipper, Jindal Iron; the receiver, Hiansa; and charterer TCI Trans Commodities, subsequently started proceedings against Islamic, alleging damage in transit. TCI sued under the charterparty. Jindal and Hiansa sued as bills of lading holders. Islamic argued it was not liable for the cargo operations, either under the charter or the bills of lading – which were on the Congenbill form and incorporated the charter terms. According to the claimants, clause 3 was inconsistent with Hague-Visby Art III r 8 and so did not transfer the ‘proper performance’ obligations from the owner to the cargo interests. Islamic responded that clauses 3 and 17, taken together, transferred both obligations – to pay, and to ensure the operations were properly carried out.