Braber Equipment Ltd. v. Fraser Surrey Docks Ltd.

In Carriage of Goods by Sea on (Updated )

This case involved damage to a container of equipment admittedly caused by the negligence of the terminal operator. The terminal operator sought to limit its liability to $100.00 per package pursuant to a limitation clause contained in its tariff. The Court found, however, that the Plaintiff had no knowledge of the tariff and was not bound by it. The Plaintiff’s freight forwarder was aware of the tariff but as the decision to unload the container at the Defendant’s terminal was made by the carrier and not the freight forwarder this did not assist the Defendant. The terminal operator further sought to rely upon the Himalaya clause in the carrier’s bill of lading. The Court noted that the appropriate test to be met is the four point test enunciated in Scruttons Ltd. v Midland Silicones Ltd., [1962] A.C. 446 (i.e.. 1. that the bill of lading makes it clear that the stevedore is intended to be protected; 2. that the bill of lading makes it clear the carrier is contracting as agent for the stevedore; 3. that the carrier has authority from the stevedore to do that; and, 4. that any difficulties about consideration are overcome). The Court held that the terminal had failed to satisfy the third requirement. In obiter, the Court noted that if the Defendant was entitled to rely upon the Himalaya clause in the bill of lading there would be two inconsistent limitation provisions; the per package limitation under the bill of lading of 666.67 SDR per package and the $100 per package limitation under the Defendant’s tariff. Following the decision in Meeker Log and Timber v The "Sea Imp VIII" (1996) 21 B.C.L.R. (3d) 101, the Court noted that two inconsistent exclusion/limitation clauses rendered both clauses null and void. On appeal, the terminal sought to re-argue the case on the basis of sub-bailment principles. The Court of Appeal declined to allow it to do so on the grounds that the record was not sufficient and there would be prejudice to the plaintiff. In result, the appeal was dismissed.