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Suppliers & contractual limitation of liability

Can suppliers of marine spare parts rely on the contractual limitation of liability? Well, it depends a lot on the law of the place where the claim is brought.

In The Camilla Desgagnés [2019], it was Quebec, Canada. Vsl had suffered ME failure due to crankshaft damage. Warranty period had expired and Wartsila’s liability was contractually limited to €50k. Vessel’s insurers brought a claim for full value of the damage - €5.6m. The central controversy was what law governed the claim – Canadian maritime law or Quebec civil code? If former then the limitation cl. was valid.


Interpretation of contractual terms depends on purpose of goods. Supreme Ct. found that apportionment of risk in such cases may well impact other related obligations, like those under marine insurance and sea carriage contracts, because functionally, crankshaft etc. are intimately linked to vsl’s seaworthiness. Sale of such engine parts could not be divorced from broader maritime context & the claim fell within Canadian maritime law. BUT as per Court there was also concurrent application of Quebec civil code because of which, Wartsila, as a professional seller, could not rely on the contractual limitation cl.


Suppliers would now atleast try to avoid any Quebec nexus in the governing law clause!




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