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Limitation of Ship Owner’s Liability by a time charterer with Delivery of Cargo without Collection of the Bill of Lading at a Bonded Warehouse - Korean Supureme Court Decision dated 9th May 2014, Case No. 2014Ma223 -

  • Journal of International Business Transactions Law
  • Abbr : IBT
  • 2016, (16), pp.95-118
  • Publisher : The Institute for Legal Studies Dong-A University
  • Research Area : Social Science > Law > Private Law > International Commercial Transactions Law

나우경 1 Cheong Yeong Seok 2

1폴라리스해운 보험법무팀 부장, 외국변호사(미국, 워싱턴 D.C.)
2한국해양대학교

Candidate

ABSTRACT

Limitation of Ship Owner’s Liability is a legal system which has been acknowledged by international conventions or local laws, where the ship owner’s liability occurred in relation to vessel operation can be limited in proportion to the tons of the ship. In the subject case, the bill of lading holder suffered damages by delivery of the cargoes without collection of the bill of lading and raised claims against the carrier. The carrier, who was the time charterer of the vessel, applied for Limitation of Ship Owner’s Liability under Article 769 of the Korean Commercial Law. The issues in this case was whether the damages of the bill of lading holder belonged to the “claims in respect of ... damage to property ... occurring on board or in direct connection with the operation of the ship” in Clause 1, Article 769 of the Korean Commercial Law. In the subject case, the cargo was not damaged on board but was wrongfully delivered at a bonded warehouse and thus there was not a damage to property occurring on board under Clause 1, Article 769 of the Korean Commercial Law. In addition, discharging of the cargoes and the storage thereafter belong to the commercial areas and not to navigation or technical operation of a vessel. Wrongful delivery of a cargo is not a physical damage or loss and thus does not satisfy the requirements to apply Limitation of Ship Owner’s Liability under the Korean Commercial Law. The decision of the Korean Supreme Court is reasonable. Meanwhile, the applicant for the procedure of the Limitation of Ship Owner’s Liability(“Limitation Procedure”) was the time charterer of the vessel. The Korean Supreme Court in the subject case did not consider the issue of whether a time charterer of a vessel can apply for Limitation Procedure. But, this issue seems important as in reality the commercial usages of vessels are being diversified and the word “charter” is used in various situations. In America, by law, only a bare boat charterer can be admitted as a charterer to apply for Limitation Procedure but a time charterer cannot be admitted. In England, by case laws, on the other hand, a time charterer can apply for Limitation Procedure. Considering the purpose of introduction of the system, it is proper only to allow the ship owners or bare boat charterers to limit their liability in total. Therefore, the applicant in the subject case should not be allowed to apply for the limitation procedure.

Citation status

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