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Fire due to cargo misdeclaration – can the carrier rely on the ‘fire’ exception in the HVR?

Over the past few years, the word ‘fire’ has become synonymous with ‘containers’. Today, a lot is expected from carriers, especially in relation to tackling cargo misdeclaration. But to what extent are they required to go? In The APL Austria [2022], The Court of Appeal in The Hague has shed light on how Dutch courts might look at this.

The slot charterer had accepted booking of containers where the cargo had been declared as ‘calcium chloride’ which is a harmless substance. As per investigations, fire originated in one of these containers. The actual cargo probably was calcium hypochlorite, which is considered hazardous (and has caused many fires in the past). Various cargo stakeholders were alleging that the slot charterers should have been aware of the risk of misdeclaration, and more so in this case since calcium chloride is a known guise for calcium hypochlorite; and they should have checked the containers. To fend off these claims, slot charterers were attempting to rely on the 'fire' exception in the Hague Visby rules.

As per the Court, the starting point is that a carrier must be able to rely on the correctness of the cargo description in the B/L unless there are special circumstances. Here the booking was made by a reputable freight forwarder in China and the cargo was described in very specific terms. As such there was no reason for the carrier to be suspicious. Although a quick check of the sender’s and receiver’s website would have shown that the cargo was probably calcium hypochlorite since these companies were dealing in swimming pool disinfectants, the Court said that a carrier cannot be required to go this far before accepting cargo. The slot charterers were therefore able to rely on the fire exception in HVR.

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