Real Case 3: A Cargo Claim

Real Life Situation: A vessel was carrying a cargo of grass mats from Hong Kong to Long Beach. Clean Bills of Lading had been signed by the Master of the vessel.

The Problem: Upon discharge, the mats were found to be heavily mouldy and wet damaged.

The Claim: The receivers lodged a claim for the damaged cargo in the amount of USD 1,000,000.

Action Taken: Andrew Liu & Co. Ltd was advised of the incident, and immediately liaised with the Claimants, and discussed this case with the vessel’s P&I Club.

Surveys were held by both the receiver’s and the vessel’s P&I Surveyors but no conclusive evidence was obtained from the surveys as to what the cause of damage was. We investigated and traced the voyage from the time of loading until delivery. There was no unusual occurrence during this voyage. We then contacted the Sellers, and it was found that this was the first time the mats were shipped and sold overseas. There was no record of these ever surviving a long sea transit.

We arranged for laboratory tests of the mats, and found that there might have been a tendency for the mats to produce its own moisture on a long sea transit. We argued that the cargo damage was due to the inherent nature of the cargo and that the shipowner was not liable. The Claimants appointed well known cargo lawyers. We discussed this matter with them, and after several meetings, offered, with the approval of the P&I club a nuisance settlement of USD 30,000.

Despite the fact that the cargo lawyers threatened to commence litigation in the courts, we recommended the Shipowner to maintain our firm’s position and eventually the offer was accepted, much to the advantage of the Shipowner.

Settlement: USD 30,000 full and final settlement.

We were able to assist the Shipowner to avoid a very serious and large claim (USD 1,000,000) which would have also been put on his Claim Record at next renewals.