Compania Sud Americana de Vapores SA v Sinochem Tianjin Ltd (Aconcagua)
| Jurisdiction | England & Wales |
| Judge | Maurice Kay,Longmore,Stanley Burnton L JJ |
| Judgment Date | 09 December 2010 |
| Court | Court of Appeal (Civil Division) |
| Date | 09 December 2010 |
Court of Appeal (Civil Division).
Maurice Kay, Longmore and Stanley Burnton L JJ.
Robert Bright QC and Anna Gotts (instructed by Reed Smith LLP) for the appellant.
Simon Rainey QC (instructed by Holman Fenwick Willan) for the respondent.
The following cases were referred to in the judgment:
Athanasia Comninos, TheUNK [1990] 1 Ll Rep 277.
Rhesa Shipping Co SA v Edmunds (The Popi M)WLR [1985] 1 WLR 948.
Shipping — Dangerous cargo — Explosion — Self ignition of kegs of calcium hypochlorite stowed in container — Claim by time charterer against shipper — Bill of lading subject to Hague Rules — Container stowed adjacent to bunker tank heated during voyage — Explosion in tropical waters with high ambient temperature — Heating of bunker tank not causative — Evidence that cargo had abnormally low critical ambient temperature — Cargo of dangerous nature — Charterer did not knowingly consent to shipment of cargo of such nature.
This was an appeal by the shipper (Sinochem) of a cargo of calcium hypochlorite which exploded on a voyage from South Korea to Chile.
The calcium hypochlorite, with an IMDG dangerous goods classification of UN 1748, was stowed in quadritainers which were themselves loaded in a container. The respondent, CSAV, was the carrier under a bill of lading which was subject to the Hague Rules. Under the IMDG Code, UN 1748 calcium hypochlorite was to be stowed away from sources of heat. It was in fact stowed in a position which was surrounded on three sides by a bunker tank, which was not a source of heat at the time of shipment but began to be heated some days before the explosion. At the time of the explosion the vessel was in tropical waters and was, as a result, subject to elevated ambient temperatures.
CSAV's case was that the cargo had, unknown to CSAV, an abnormally high thermal instability, being prone to self-heat at ordinary carriage temperatures. As a result the cargo, in its container, exploded on board the vessel at temperatures which were ordinarily to be expected onboard the vessel during the voyage. Sinochem's case was that the heating of the bunker tank on the voyage was either the (or a) cause of the explosion. CSAV contended in response that the stowage of the cargo next to a bunker tank which was heated on the voyage was of no causative significance. The contribution made by the heating of the bunkers to the warming of the container and its contents was wholly insufficient to have had any significant effect on, and made no difference to, the outcome.
The judge ([2009] EWHC 1880 (Comm)) accepted CSAV's case and rejected Sinochem's case. Sinochem appealed arguing that the judge had held Sinochem liable to CSAV merely because he rejected Sinochem's primary case that the explosion was caused by exposure to excessive heating and that he was wrong to so hold because the explosion could have been caused by some other (unknown) factor; that, to the extent that the judge relied on factors other than his rejection of Sinochem's primary case, his reliance on such factors was misplaced; and that, accordingly, CSAV had failed to prove its case that, in breach of contract, Sinochem had shipped a dangerous cargo.
Held, dismissing Sinochem's appeal:
1. The judge did not jump straight from the conclusion that the cause suggested by Sinochem (namely heating of the bunker tank during the transfer of bunkers) did not cause the explosion to the conclusion that the explosion must have been caused by the rogue nature of the cargo. The judge used other evidence to come to that conclusion, namely expert evidence that the material actually shipped was likely to have had an abnormally low critical ambient temperature and that the Chinese factory from which it came had poor manufacturing standards and inadequate quality control.
2. Calcium hypochlorite was not a cargo whose nature was such that even a strict compliance with the accepted methods of carriage would not suffice to eliminate the possibility of an accident. It had been carried safely for decades and if the carriage by the shipowner (or, as in this case, the time charterer) could not be faulted the likelihood must be, both in common sense and in law, that the claim by the owner/charterer for breach of contract in shipping dangerous cargo was likely to succeed. (The Athanasia ComninosUNK[1990] 1 Ll Rep 277considered.)
1. At about 0230 local time on 30 December 1998 an explosion took place in the No 3 hold of the mv “Aconcagua” when she was on passage off the coast of Ecuador. The fire which resulted was so great that the crew had to abandon ship. Widespread damage was caused to the vessel and her cargo.
2. The cause of the explosion was the self ignition of 334 kegs of calcium hypochlorite stowed in quadritainers which were themselves loaded in a container (“the container”). The container had been loaded at Busan, South Korea and was due to be discharged at San Antonio in Chile. The vessel was on time charter to Compania Sud Americana de Vapores S.A. (“CSAV”), a Chilean company, the claimant. The owners of the vessel — MS ER Hamburg Schiffahrtsgesellschaft mbH & Co (“the Owners”) — commenced an arbitration under the charterparty against CSAV. The arbitrators issued an interim award as a result of which CSAV...
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