HiHonor Lawyers Successfully Relied on the “Perils of the Sea” Defence

Assisting Carrier Settled a Series of Cargo Suits before PRC Courts

MV X was operated on a liner service between the Far East and Central and South America ports. After loading goods at her last loading port in Asia, Busan of Korea, the vessel departed to Ensenada, Mexico on Dec. 23, 2019. The vessel encountered heavy weather and high sea during 28 to 29 of Dec. 2019 when passing by North Pacific Ocean, consequentially 49 containers were found lost / collapsed overboard from bay 56 and many other containers were found damaged arising therefrom. Several lawsuits were filed by cargo side (cargo underwriters) before PRC maritime courts, claiming for compensation of cargo losses.

HiHonor lawyers were instructed by carrier under respective Bs/L to defend those cargo claims. After analysis merits of those cargo suits, we opined that Perils of the Sea defence could apply. To support such defence, in addition to the ship certificates, deck and engine logbook, weather routing guidance information, sea protest, investigation reports, cargo securing manual etc., we especially rendered considerable time for collecting the VDR data, and HiHonor marine consultants assisted in scrutinizing key information from lengthy vast VDR data.

The VDR data played a crucial role in establishing on the cause to the incident. VDR is commonly known as ship's Black Box, which is a specialized device used to record navigation data of a vessel. According to IMO regulations, the design of VDR ensures that it cannot selectively record input data, all received information is recorded, and once being recorded, the information cannot be tampered with. Any attempts to tamper with the data are also logged. Therefore, the reliability of the information recorded by the vessel VDR is inherently assured.

After collecting the VDR data, we managed to find qualified engineer who successfully accessed the data through specialized software. It was confirmed from the VDR data that the vessel indeed encountered heavy weather during December 28-29, 2019, with wind reaching force 10, even force 11. From the Master’s phone reports to the owners’ company and conversations among the crew on board, the Master and the crew repeatedly mentioned that the vessel rolled to 35 degrees due to the adverse weather.

Through careful analysis of solid evidence, we well established the following facts to the PRC Qingdao Maritime Court:

Before departing from Busan Port, the Master planned a route to Ensenada based on weather routing guidance service’s (WRGS) recommendation. On December 27, 2019, WRGS directed vessel to amend route, stating that due to significant change in latest forecast, a route via S of Aleutians is no longer an option, you can expect +8m sign sea and STORM on that route. WRGS also informed that the vessel was expected to get long periods of +6m sigh sea, however there is no other options. The Master adjusted the route as per the advice. On December 28, 2019, WRGS again informed that the vessel’s route seems to be affected by 6-7m E-NE-ly sign seas through the 28th UTC and suggested the vessel keeping a high speed. The vessel kept following the advice, and completed checks outlined in the Heavy Weather Navigation Risk Control Check List on December 28, recording that Cargo load, stowage and securing complied with the specification of Cargo Securing Manual. Around midnight of ship’s time on December 29, 2019, the weather conditions suddenly deteriorated, and the vessel encountered wind to force 11 and sea (waves) 8 meters.

Around ship’s time 0030 on December 29, the vessel rolled 35 degrees three times while navigating in the heavy weather. The main engine suddenly shut down, then the Chief Engineer took control of the main engine from the engine control room and restarted the main engine from the engine control room.  From the VDR recordings, it could be heard that crew members described the 35-degree rolling several times on that day. The Master, in his phone report to the owners’ company on the same day, also explicitly mentioned that the vessel rolled up to 35 degrees.

Following the incident, surveyors/naval architects from well-known London company LOC were appointed by the vessel owners, after analyzing the vessel’s AIS data for a period +/- 1.5 hours of the incident and the corresponding weather and sea conditions recorded in the Weather Forecasts, it was concluded by LOC that the heavy rolling was likely caused by parametric rolling.

According to the ship’s Cargo Securing Manual approved by MSA of PR China, the ship’s lashing arrangements are designed with a maximum rolling angle of 22 degrees. Calculation of ship's Lashing Instrument showed that at a rolling angle at max. 22 degrees, the forces on the bay 56 of the containers remain within the allowable range, but when a rolling angle at 35 degrees, the forces on the bay 56 in all directions nearly all exceeding the permissible range. Therefore, it was the severe rolling caused by adverse weather that resulted in the forces exceeded the ship’s design parameters of cargo lashing, consequentially led to the collapse of the container stacks, with containers near the two sides of the ship falling into the sea and other collapsed containers being damaged.

It can be concluded from the above,

• The vessel encountered heavy weather, the weather routing service company failed to predict nor to advise the vessel to avoid such heavy weather, which caused the vessel rolled to 35 degrees, leading to forces to the lashing system exceeded its design parameters, and the ship’s lashing system collapsed thereby.
• Despite the crew exercised due diligence properly and carefully taking care of the goods, they were unable to prevent the consequences of the containerized cargo loss or damage.
• The incident met the conditions for the carrier to rely on the Perils of the Sea defence under Article 51(3) of China Maritime Code, which exempts the carrier from liability for loss or damage to goods when such loss or damage is caused by the Perils of the Sea.

Court Hearings for Evidence-exchange & Debating were organized for ALL cargo suits (Five before Qingdao Maritime Court and One before Shanghai Maritime Court).

Based on our well-established evidence list and solid arguments on the Bs/L Carrier (slot charterer) behalf, the Perils of the Sea defence successfully assisted our Carrier clients in reaching settlements for ALL cargo suits at rather low ratio (Five cargo suits not exceeding 30% of the claimed amount).While prior to our involvement, other cargo claims arising from the same incident were said having been settled at much higher ratio.

There were very few reported cases in PRC maritime trial practice supporting the “Perils of the Sea” defence. HiHonor lawyers’ professional, dedicated and remarkable services protected the interests of the carrier clients to the maximum.

HiHonor lawyers’ effective analysis of the VDR data etc. key evidence and the facts that quite a number of cargo suits filed in Qingdao Maritime Courts were amicably settled by HiHonor lawyers acting for the Bs/L carrier (slot charterers) at much humble low ratio NOT exceeding 30% of respective claimed amount, well enhanced and contributed directly to the head owner’s defence based on the Perils of the Sea in Shanghai Maritime Court and its appeal court (Shanghai High People's Court), it was finally upheld by PRC court that carrier should be entitled to the Perils of the Sea defence, exempting from cargo compensation liability.

If you would like further information in this update, please contact:

E-mail: xinwei.zhao@hihonorlaw.com

Mobile:  +86 137 0642 0263

Tel:     +86 532 8082 1123 (DDI)

Huanying LIU

E-mail: huanying.liu@hihonorlaw.com

Mobile:  +86 185 6151 7061

Tel:     +86 532 8082 1133