Rules

The ‘philosophy’ of the Rules is threefold.  First they set out the obligations of both parties, particularly the carrier for whom they list the minimum statutory requirements imposed upon him in the undertaking of international trade.  Secondly they set out where a carrier may exempt himself from liability as a result of one of the exceptions embodied in the Rules. Thirdly, they explain the limits of the carrier’s liability.  The merchant should not consider the shipowner as the insurer of his cargo. A prudent shipper would cover himself from loss or damage to his cargo by taking out an all risks policy Any claim to be pursued against the shipowner would then be undertaken by the cargo insurers. Articles I. Sets out the definitions of the word “carrier” and of “contract of carriage”.  Note that when stressing that the Rules apply only to contracts of carriage covered by a bill of lading it explains the position of B/Ls issued under a charter party. Rule 1 (c) almost hides an important aspect of the Rules in that they do not cover live animals neither do they cover which by the contract of carriage is carried on deck.  It is important to take account of the words “by the contract of carriage”.  To avoid liability the B/L must clearly state “loaded on deck” (some lines add the words “at shipper’s risk”).  If the cargo is loaded on deck but this is not mentioned on the B/L, the full force of the Rules will apply.