The carriage of liquefiable cargo: regulations, rights and liabilities

Abstract

Solid bulk liquefaction has contributed to the occurrence of many major disasters in the bulk shipping industry. Albeit not being a recent phenomenon, the world was ale1ted to its dangers following the loss of three vessels within three months in 2010, claiming a death toll of 44 crewmembers. Some types of solid bulk materials, i.e. iron ore fine and nickel ore, have a tendency to liquefy after being loaded aboard ships, due to their unique character in rapidly transforming from solid to semi-liquid state. This abnormal behaviour is resulted from an increase in the moisture content present in the cargo, which may have been developed by reason of the vessel's motion or vibrations coming from the engine room. Consequently, the cargo shifts within the vessel's holds and drastically endangers her stability which may result in capsize. Therefore, liquefiable solid bulk materials were described as 'a wet wolf in a d1y sheep's clothing', as they appear dry and safe at loading, but later liquefy jeopardising the safety of life and property at sea.

The relevant regulation, namely the International Maritime Solid Bulk Cargo (IMSBC) Code, has been criticised for failing to tackle the occurrence of liquefaction incidents. The shipping industry has been mostly dealing with the liquefaction issue from a technical perspective, either recommending the use ofdifferent test methods on the cargo to be loaded or altering vessels' hull structure to accommodate any liquefaction that may occur. As a result, there is no legal research being carried out that outlines the legal implications of the issue of solid bulk liquefaction on chatterparties, and thus shippers, charterers and catTiers are often left in dilemma as to the question of liability once liquefaction occurs and causes the loss of the ship, or when the safety of the cargo cannot be ascertained at the load port resulting in substantial delay.

Therefore, this thesis undertakes a thorough assessment of the IMSBC Code's effectiveness, identifying its flaws and reviewing why parties fall short of compliance with its provisions, in Chapter 2. The thesis establishes that miss-categorisation of cargoes within the Code, unreliable test methods delivering inaccurate results and improper enforcement by port authorities are the main factors undermining the effectiveness of the Code. In addition, this thesis examines the application of well-established legal principles under English law to detem1ine the allocation of risk problems that may arise, following liquefaction of the cargo onboard. In particular, it outlines the circumstances when the carrier can rely on the inherent vice defence to exclude his liability for the liquefied damaged cargo in Chapter 3 and, in Chapter 4, it addresses when solid bulk materials can be regarded as dangerous goods, and the consequences on the liabilities of the parties resulting therefrom.

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