Document Type : Research Paper
Author
Assistant professor, Faculty of Law and Political Science, University of Tehran,Iran
Abstract
The simple method of transportation is that the cargo is loaded in port of delivery and unloaded from the same vessel in the port of discharge. However, there are frequent cases that accomplishment of the voyage requires the transfer of cargo to another vessel, whether to the same (sea vessel to vessel for instance) or another mode (sea vessel to vehicle, vehicle to aircraft, etc) which is called “transshipment”. Transshipment from a technical viewpoint, is a cargo management operation which along with other methods, including “Ro-Ro carriage” and “Cross-stuffing” leads to less cost in transportation. However, in the legal terms it might be deemed as “deviation” and a fundamental breach of the contract.
Transshipment is either predicted by the parties to contract of carriage (bill of lading) or the fortuitous events in the voyage necessitate such operation. This issue is so important that not only in the bill of lading but also in the sale contract and letter of credit is dealt with and one must answer this question that in the case of no agreement on the transshipment, is such operation, in principle, allowed or not? Obviously, this operation brings about delay in the process of carriage and other risks like sea pollution (in the case of oil transfer) which affects the interests of not only the cargo owner but also other merchants including the LC issuing bank and even the state authorities like department of Customs. Therefore, this article is going to scrutinize the legal conditions under which the carrier is authorized to do transshipment in accordance with the international conventions and the particular contractual conditions like “liberty to transship clause”.
Moreover, the consequences that such operation brings in terms of the liability and rights of carrier are dealt with in this article. These consequences are analyzed in two parts: when the transshipment is allowed and when it is not allowed. In the latter case, one should see whether the same impacts of deviation under maritime law are applied on trans-shipment so that the contract of carriage is frustrated and the carrier is deprived of invoking to liability exclusions and limitations (based on the international conventions) or some other peculiar consequences must be looked for. On the other hand, this article has analyzed the consequences of allowed transshipment in particular, whether the carrier liability ceases to continue after the transshipment or he is still liable for all damages; moreover, this issue is dealt with that whether the exclusion of liability clause for damages after transshipment is valid or not. Finally, the carrier entitlement to freight after the transshipment is discussed in this article further to the person who is liable for transshipment costs: carrier, shipper or consignee?
According to the explanations given in this article, it can be concluded that despite the many risks caused by transshipment or the transfer of cargo from one device to another, this operation is an integral part of transporting goods in Many items have been converted. The advancements of the transportation industry, especially the container revolution, have helped to resolve the concerns of traders about the risks and costs of transshipment, so that the agreement between the buyer and the seller on the possibility of transshipment if the cargo is transported in a container, is recognized by the legislative authorities and the International Chamber of Commerce, a clear example of which can be seen in UCP 600 (Article 20).
Not only transshipment is done under the strict control of government authorities to reduce the scope of fraud in relation to export, import and customs regulations, but in the private relations of the parties to the contract of carriage, the principle is that the transshipment is impermissible unless according to the explicit or implicit agreement of the parties or the procedure of the related business is that the transshipment is predictable and within the common intention of the parties, or that due to unforeseen reasons, the completion of the voyage depends on it, which in the latter case, the Iranian Maritime Law (Article 157) not only allows the captain but also obligates him to transfer the cargo by another means.
Unauthorized transshipment, although according to the opinion of some jurists, it produces the same effects as "deviation" in maritime law, but the opinion that only considers it a fundamental violation of the contract of carriage and causes the right of termination and compensation for the cargo owner is in accordance and more compatible with the legal rules. In the assumption that the carrier is authorized to carry out these actions, the governing spirit of the international regulations of transportation as well as the Iranian commercial law indicates that the responsibility of the carrier remains after the transshipment, although the exclusion of liability clause for damages after that should also be legitimate under certain conditions.
Also, it is concluded in this article that the costs of transporting the cargo by another means of transport due to the termination of the transport contract and according to the rule of the management of third party’s property (which is applicable in fortuitous transshipment) should be charged to the account of the owner of the goods, unless the incident is temporary and the carrier is in line with the execution of the contract has taken it upon himself. The same reasoning will apply to the carrier freight the carrier shall not be deprived of its outstanding freight due to transshipment.
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