Containers are used to ship goods worth millions. Cargo owners may find it harsh that often they might not be able to recover more than 1/1000th of the goods’ value from the carrier because of the limitation in Hague rules, as in The Bavaria [2019].
Global Oil Tools (GOT) contracted with a NVOCC to arrange for transport of tools worth $2.4m in 2 cntrs from US to Romania. GOT then requested for a 2 wk delay in shipment but this was not relayed to the stevedoring company and consequently the cntrs arrived earlier than scheduled. GOT sued the NVOCC, sea carrier and stevedoring co. seeking damages for erroneous shipment.
The sea carrier and stevedoring co. relied on the Himalaya cl. As for NVOCC, it contended that the limitation as per US COGSA was $500 per cntr. GOT argued that the cl. was not enforceable for various reasons; it had no notice of COGSA’s package limitation, & early shipment amounted to deviation.
US court said the Himalaya clause served a useful purpose & was enforceable. As for the $500 limitation, GOT was given a fair opportunity to go through NVOCC's T&Cs, albiet on their website; and to declare ad valorem valuation on B/L but did not. On deviation, the court found little merit in it. The maximum amount GOT could thus recover was $500 per container.
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