Belgium: Non-Declared Deck-Carriage

(Sea Venture Volume 20)

Since the Judgement of the Belgian Supreme Court in the "Balduin"¹ in 1979 the Belgian courts have always considered that the Carrier who carries goods on deck without mentioning the deck-carriage in the bill of lading can not avail himself of the exemptions and limitations of liability under the Hague/Hague-Visby Rules, incorporated in the Belgian Maritime Code (BMC) in Article 91.

In the "Balduin" the Court held as follows:

"Considering that the Third-Holder of a "clean" Bill of lading may trust that the goods will be carried under deck and will therefore not be exposed to the risks of deck cargo; that on the contrary, when it is mentioned on the Bill of lading that the goods are carried on deck said Third-Holder is informed on the one side, that the cargo is exposed to the special risks to which cargo carried in the hold of the ship is not exposed and, on the other side, that the Sea-carrier may then freely limit his liability notwithstanding the rule of article 91, A, §III, 8° of the Maritime Code; that he then may take insurance regarding the cargo with full knowledge of its deck-carriage."

The Belgian courts accept though that if the Bill of lading contains a written or stamped deck-clause "carried on deck, vessel not responsible for loss and/or damage however caused " the Carrier will be liable only in case of intentional fault.

According to article 66 BMC the Master is responsible for "any damage suffered by the goods which he has put on deck without written authority of the Shipper". Various Belgian legal texts have suggested that this rule can be found in the "Ordonnance de la Marine" of 1681 and that it has not been changed in more than 300 years.

In neighbouring countries, such as France and Holland, the Carrier is not deprived of his exemptions nor of his right to limit liability unless the Carrier has acted with intention to cause damage, or recklessly and with the knowledge that his action would probably cause damage.

It has also been suggested that:

• the Carrier’s right to limit liability in these circumstances under the Hague-Visby Rules should apply since Belgium is a signatory to the Rules and that the Rules should take precedence over the national law (even if that national law deals with matters of public policy).

• In the interests of unification of law (which the Rules were introduced to promote) the Rules should not be interpreted on the basis of individual national criteria.

The Belgian Supreme Court had an opportunity to address these issues in a case which recently came before it: The Owner operated a liner service with container vessels between Antwerp and New York. On 23^rd January 1990 4 containers containing polyvinyl were loaded on board the vessel and stowed on deck. The bill of lading contained a "deck option clause" according to which the containers could be carried on or under deck without notice to the shipper, as well as a "Liberty" clause stipulating that the Carrier has no obligation to mention explicitly the deck-carriage in the bill of lading. Shortly after leaving Le Havre the vessel encountered a hurricane and 2 out of the 4 containers shipped were lost over board.

In January 1991 the Receivers issued proceedings in the Antwerp Commercial Court against the Owner and the Carrier claiming US$ 340,318.40.

In 1993 the Antwerp Commercial Court made the following decision:

1. The Hague/Hague-Visby Rules, which are intended to create uniform rules of law, take precedence over national law and must be interpreted in an autonomous manner in the light of the Convention and Protocol by which they were implemented;

2. The Hague/Hague-Visby Rules are applicable to the carriage of containers as deck-cargo;

3. It is commonly accepted practice that containers may be carried as deck-cargo on board container-carrying vessels designed for that purpose; a clause in the bill of lading authorising such carriage is binding on the holder in due course (including, as in this case, a third-holder) of the bill of lading;

4. Art. 66 BMC, which prohibits the loading of the goods as deck-cargo without the written consent of the shipper, is inapplicable in the light of the terms of the deck option clause in the bill of lading and the field of application of the Hague/Hague-Visby Rules;

5. The vessel encountered conditions equivalent to a hurricane. The Carrier is not liable for damage caused by the perils and hazards of the sea which make it impossible for him to prevent the goods from suffering damage.

The Commercial Court explicitly referred to the laws of neighbouring countries such as France, Germany, Holland and the United Kingdom, to a change of the practice regarding insurance of deck-cargoes, to Article 9 of the Hamburg Rules which refers to the "custom of the trade" and to the fact that if one continues to apply the "classic jurisprudence" of the Belgian Courts, the situation of the Belgian ports becomes untenable.

An Appeal was lodged by cargo interests. The Antwerp Appeal Court, in its judgement of February 1997, considered that:

1. Article 91 of the Belgian Maritime Law is not applicable to deck cargo;

2. A Carrier by sea who fails to mention on the bill of lading that containers are stowed on deck commits a fault in relation to the holder in due course of the bill of lading, who has confidence in the fact that the goods are not exposed to the special risks arising from their not being stowed in the holds of the vessel;

3. A presumption of liability rests upon the Carrier acting in this manner and he can rely, against the third-holder, neither upon the exemption clauses nor the limitations of liability contained in article 91 BMC, nor upon clauses contained in the bill of lading;

4. It is a breach of confidence in relation to the third-holder of the bill of lading for the goods to be stowed on deck in such circumstances, even where the carriage by sea is being effected by container vessels on which all cargo is in practice carried on deck.

The Appeal Court explicitly mentioned that the arguments based on economics or insurance are not convincing because, in its view, stowage on deck – in spite of the technical evolution of container carriage – is still more risky than carriage in the hold.

(Rather ironically, in this case the stresses exerted on the vessel during the heavy weather were so severe that one of the vessel’s bunker tanks ruptured and the cargo within that hold was contaminated by bunker oil. Under-deck cargoes are, therefore, exposed to other types of risk that would not affect containerised cargo stowed on-deck. )

The Owner and Carrier appealed to the Belgian Supreme Court. In December 2000 the Supreme Court ultimately decided:

"Considering that the Third-holder of a "clean" Bill of lading may trust that, with the exception of container vessels that have no weather deck, the goods will be carried under deck and will therefore not be exposed to the risks of deck-cargo;

That on the contrary, when it is mentioned on the Bill of lading that the goods are carried on deck, the Third-holder is informed, on the one side, that the cargo is exposed to the special risks to which cargo carried in the hold of the ship is not exposed, and on the other side that the Sea-carrier may then freely limit his liability notwithstanding the rule of article 91, A, §III, 8° of the Maritime Code; that he then may take insurance regarding the cargo with full knowledge of the deck-carriage;"

This wording is almost identical to the wording of the "Balduin" judgement except with regard to container vessels with no weather deck. In consequence, the Belgian Supreme Court has defined a purpose-built or full container ship as a vessel that has no hatches or weather deck, despite the fact that a vast majority of container ships are built with hatches and a weather-deck.

In their appeal to the Supreme Court the Owner/Carrier had underlined that the Antwerp Appeal Court had deprived them not only of the "perils of the sea" exemption, but also of their right to limit liability, in spite of the fact that putting a container on deck of a container vessel cannot be regarded as an act committed with "the intention to cause damage or recklessly and with the knowledge that the action would probably cause damage". It was also contended that the Appeal Court had refused to apply this criterion of the Hague/Hague-Visby Rules; the Appeal Court had simply said "the fact of not mentioning the deck carriage in the Bill of lading is to be regarded as a fault". The Owner also referred to a decision of the French Supreme Court (July 1998) that had annulled a decision of the Appeal Court of Rouen; the Rouen Court had denied the Carrier the benefit of limitation solely on the basis that container carriage on deck constituted a commercial fault without checking whether that fault was to be considered intentional or inexcusable.

The Belgian Supreme Court disregarded these submissions. It limited itself to the decision quoted above and to the assessment that in deciding that the Carrier has no right to invoke the limitations of liability as meant by article 91 of the Maritime Code, the Antwerp Appeal Court judges had not violated the said rules of law. The appeal by the Owner and Carrier was, therefore, denied.

Therefore, with the exception of container vessels without a weather deck, the Belgian Supreme Court has confirmed the views expressed in the "Balduin" judgement more than 20 years before. It is also considered unlikely that these views will change in the next 20 years.

After ten years of litigation it is regrettable that the Belgian Courts remain out of step with the jurisprudence of other European Courts, and that the valid arguments raised by Owners did not receive proper consideration. The First Instance Court took into account the fact that the vessel encountered the 1990 Hurricane that affected large parts of Europe. The Belgian Supreme Court, however, continues to apply outdated case law that fails to recognise the practical or commercial realities of the modern container trade.

¹ Boelwerf v Ganger Rolf JPA (1979/80) 251