Used cars present an elevated fire risk. In the event of a fire originating from such a vehicle on board a ship, can the shipper be held responsible for shipping dangerous cargo? The case of ‘The Honor [2024]’ offers some clarity on this issue.
The vessel was loaded with about 5,000 vehicles of which some were used cars. A day after departing from port, there was a smoke alarm for one of the car decks. Crew extinguished the fire by releasing CO2. Investigation revealed that fire originated in one of the second-hand cars (a 2010 Nissan Rogue). The exact cause of fire was however unknown.
Cargo underwriters (HDI) of the vehicles damaged by fire argued that the shipper should bear strict liability due to the inherent dangers of transporting used cars. However, IAL, the shipper contended that the cargo was not dangerous and, even if it were, the carrier (the charterer in this case) was aware of the associated risks.
The court ruled in favour of the shipper, determining that used cars are not classified as dangerous goods under the IMDG Code when transported on Ro-Ro vessels or in designated cargo spaces. Moreover, given the carrier's experience in transporting cars and a previous fire incident, the court concluded that the carrier was aware of the potential fire risks. Consequently, the shipper could not be held strictly liable under US COGSA.
Link to judgement: https://casetext.com/case/hdi-glob-se-v-intl-auto-logistics-inc?p=1&jxs=&sort=date-descending&type=case&ssr=false&tab=keyword&q=imdg
Comments