Short answer. The sea carrier is presumed liable for loss of or damage to the cargo between taking over and delivery, unless he proves one of the excepted perils. But three mechanisms work against the receiver: notice of loss, to be given in writing at the latest on delivery for apparent damage and within three days for anything else; limitation of liability at 666.67 SDR per package or 2 SDR per kilogramme, often a fraction of the real value; and a one-year time bar running from delivery. The case is won or lost in the seventy-two hours after the container is opened.
An importer receives three reefer containers at a non-conforming temperature. An exporter learns that his container went overboard off the Cape of Good Hope. A trader opens the doors and finds cartons crushed, soaked, or simply missing. In each case the immediate question is the same: who pays, and how to make them pay before time runs out. Maritime transport law gives a precise answer, but a formalistic one: it rewards whoever moves quickly and punishes whoever negotiates first.
Which text applies: the 1924 Convention or the Transport Code
Carriage of goods by sea under a bill of lading falls, for most international trades touching France, under the Brussels Convention of 25 August 1924 as amended by the 1968 and 1979 Protocols, the Hague-Visby Rules. It applies where the bill of lading is issued in a contracting State, or the carriage starts in one, or where the bill incorporates it by a paramount clause. Where the Convention does not apply, the French Transport Code takes over with a very similar regime at articles L. 5422-1 and following. The Hamburg Rules of 1978 apply in certain African and Latin American countries, with a two-year period and a stricter liability regime; the Rotterdam Rules of 2008 are not in force.
The first question in any file is therefore to read the bill of lading: the paramount clause, the place of issue and the port of loading fix the applicable text and with it the time bar, the limit and the burden of proof. That reading takes ten minutes and changes everything that follows.
The presumption of liability and the excepted perils
Article L. 5422-12 of the Transport Code states the rule: the carrier is liable for loss of or damage to the goods from taking over until delivery, unless he proves that they arose from one of the listed causes. Article 4 of the 1924 Convention says the same. The receiver does not have to prove fault; it is enough to establish that the goods were handed over in good order and delivered damaged, or not delivered at all. It is for the carrier to prove the cause and to bring it within an excepted peril.
Those exceptions are exhaustive: unseaworthiness without want of due diligence, fire, events not attributable to the carrier such as heavy weather, perils of the sea, act of war or act of State, strikes and lock-outs, inherent vice, fault of the shipper including insufficient packing, defective stowage in a container he packed and inaccurate declaration, nautical fault of the master or crew in the navigation or management of the ship, and salvage. Two of them dominate container litigation. Inherent vice and shipper’s fault, invoked systematically where the shipper packed the box and the bill is claused shipper’s load, stow and count, the carrier arguing that he never saw the goods. And the non-attributable event, invoked for containers lost at sea, where the carrier must show that the loss resulted neither from defective stowage nor from an imprudent route. Even where an exception is made out, the receiver can regain the advantage by proving that the damage was caused, wholly or partly, by the carrier’s fault or by a failure to exercise due diligence to make the vessel seaworthy: a reefer plugged in wrongly, a temperature unmonitored during transhipment, a box carried on deck on a vessel not equipped for it.
The seventy-two hours: notice, survey, evidence
Article 3(6) of the 1924 Convention creates the opposite presumption: failing written notice to the carrier or his agent at the time of delivery for apparent damage, and within three days for damage not apparent, the goods are presumed to have been delivered as described in the bill of lading. The presumption is rebuttable, but in practice it reverses the burden of proof and badly weakens the case. The reflex is therefore: on opening the container, before any unloading, photograph the seals, the numbers, the exterior condition, the internal stowage and the damage; download the reefer temperature records; give precise, quantified written notice to the carrier or his agent the same day, by email or recorded letter; and for significant damage, have the condition recorded by a judicial officer or call a surveyor.
Notice must not be general. Goods damaged will not do; cartons 1 to 120 out of 400 crushed and wet, pallets 3 and 7 collapsed, original seal intact is a notice. It must go to the right person: the sea carrier or his agent, not the forwarder or the road haulier who delivered the box, unless they are copied as well. And where the damage is significant, a joint survey is indispensable: calling in the carrier, his P&I club, the cargo underwriter and, where relevant, the seller allows the cause and extent to be fixed on a common basis before the goods are destroyed or sold for salvage.
The limit: 666.67 SDR per package or 2 SDR per kilogramme
This is the least understood provision and the most painful. Article L. 5422-13 of the Transport Code refers to the figures in article 4(5) of the amended 1924 Convention: liability is limited to 666.67 Special Drawing Rights per package or unit, or 2 SDR per kilogramme of gross weight of the goods lost or damaged, whichever is the higher. The SDR, the International Monetary Fund unit of account, is worth roughly 1.25 euro depending on rates. For a container holding twenty tonnes of valuable goods, the weight limit reaches 40,000 SDR, some 50,000 euros, whatever the cargo is actually worth.
The concept of a package decides the outcome where the per-package limit is the higher. The Convention provides that where a container is used to consolidate goods, the number of packages enumerated in the bill of lading as packed in the container is deemed the number of packages; failing enumeration, the container is the package. A bill reading one container said to contain 800 cartons opens a limit of 800 times 666.67 SDR; a bill reading one container caps liability at 666.67 SDR for the whole, unless the weight limit is higher. The drafting of the bill, often left to the forwarder, therefore decides in advance how much is recoverable. The limit falls away in two cases under article L. 5422-14: a declaration of value inserted in the bill and accepted by the carrier, which costs extra freight but secures indemnity up to the declared value; and the carrier’s own reckless act or omission, done with intent to cause the damage or recklessly and with knowledge that damage would probably result. Proving that is difficult: it requires a decision of the carrier himself, not of his master.
One year: the time bar and its traps
An action against the carrier for loss or damage is time-barred after one year (article L. 5422-18 of the Transport Code; article 3(6) of the 1924 Convention). Time runs from delivery or from the date when the goods should have been delivered. One year is short for a file that begins with notice, continues with a survey, a claim to underwriters and a negotiation with the carrier’s P&I club, and ends with a writ. Many claims die this way: the receiver negotiates in good faith with a club that answers slowly, and finds himself out of time.
Two mechanisms protect against that. The first is contractual extension: the text allows the parties to extend the period by agreement made after the event, and P&I clubs routinely grant written time extensions of three or six months, which must be requested before expiry and renewed. The second is interruption by a writ, the only certain route: a letter before action, a claim or a private survey do not interrupt time. Where negotiation has not succeeded two months before the deadline, proceedings should be issued, and the discussion can continue under the court’s supervision. Recourse actions have a further three months from the date the action against the party seeking indemnity was brought, which allows a forwarder who has been sued to pass the claim up the chain.
Whom to sue: carrier, forwarder, NVOCC, underwriter
A receiver usually has several counterparties and hesitates over the right one. The sea carrier is the party who issued the bill of lading, or on whose behalf it was issued: he is the debtor of the presumption of liability. The contracting carrier, often an NVOCC or a forwarder who issued his own house bill of lading, answers as a carrier towards the receiver and has recourse against the actual sea carrier. The transport commissionnaire who organised the whole movement guarantees the carriers he chose and answers for his own fault. The road or rail carrier who brought the container to the warehouse answers under a different regime, with its own notice requirements and its own time bar, which makes it essential to identify the leg on which the damage occurred.
The cargo underwriter, where a policy exists, indemnifies the assured and then exercises subrogated recourse against the carrier: for the receiver this is generally the fastest route, provided notice was properly given, failing which the underwriter will say the recourse was not preserved. Finally, standing deserves checking: only the holder of the bill of lading, or someone who can show a loss, may sue the carrier, so a buyer who has not yet paid, or a seller already paid, must establish his interest.
Containers lost overboard, and the general average declaration
Loss of containers at sea, through heavy weather or failure of the lashings, follows the same regime with two peculiarities. The carrier almost invariably invokes perils of the sea; the receiver answers with defective stowage and with the meteorological data, which often show that the event was foreseeable and that neither the route nor the speed was adapted to it.
And where the master has jettisoned containers or put into a port of refuge to save the ship, the owner declares general average: the owners of the goods saved contribute to the sacrifices and expenditure, and must provide security before recovering their cargo. That mechanism, governed by the York-Antwerp Rules, has its own logic and its own deadlines, entirely separate from the cargo claim against the carrier.
How the firm works
The firm acts for receivers, shippers, forwarders and cargo underwriters: immediate framing of the notice and of the joint survey, reading of the bill of lading to determine the applicable text, the limit and the time bar, quantification of the loss, claim to the carrier and his P&I club, negotiation of time extensions, and proceedings before the commercial courts of the French ports where negotiation fails.
It also acts for carriers and forwarders defending claims, on the excepted perils, on the limit and on the identity of the party truly liable. Based in Paris, the firm works across the French ports and in English with clubs, correspondents and foreign counsel.
Has a container just arrived damaged, or not arrived at all? Notice must be given the same day and the one-year clock is already running. An initial discussion settles the notice, the survey and who to pursue.
Frequently asked questions
How quickly must notice be given after a container is delivered?
In writing, at the latest at the time of delivery for apparent damage and within three days for damage not apparent (article 3(6) of the 1924 Brussels Convention). Failing that, the goods are presumed to have been delivered as described in the bill of lading.
How much can be recovered from the sea carrier for damaged goods?
At most 666.67 SDR per package or 2 SDR per kilogramme of gross weight, whichever is higher (article L. 5422-13 of the Transport Code and article 4(5) of the 1924 Convention), unless value was declared in the bill of lading or the carrier acted recklessly.
What is the time limit for suing the sea carrier?
One year from delivery or from the date when delivery should have taken place (article L. 5422-18 of the Transport Code). The period can be extended by written agreement made after the event; only the issue of proceedings interrupts it.
Can the carrier escape liability if the shipper packed the container?
He can invoke the shipper’s fault or inherent vice, and a shipper’s load, stow and count clause helps him. But he remains liable where the damage flows from his own fault: a reefer wrongly connected, defective stowage on board, or an unseaworthy vessel.
Is it better to sue the carrier or to claim on the cargo policy?
Cargo insurance, where it exists, pays faster and then exercises subrogated recourse against the carrier. But it requires that notice was given and the recourse preserved; failing that the underwriter may reduce or refuse the indemnity.
Further reading: general average and how to challenge the adjustment, demurrage and detention, maritime contracts and which regime applies.
Written by Hervé Guyader, avocat at the Paris Bar, doctor of law. This content is general information and is no substitute for advice on your own matter.