Cargo Damage Ruling Issued

Monday, April 19, 2004
The U.S. Court of Appeals for the Fourth Circuit ruled that the $500 per package limitation in the Carriage of Goods at Sea Act (COGSA) applies during restowage of cargo at intermediate ports, even where the damage occurs ashore. In the instant case, plaintiff cargo owner contracted with the carrier for transport of the cargo from Baltimore to Arica, Chile. The carrier issued a clean bill of lading incorporating COGSA. During an intermediate stop of the ship in Charleston, the master decided to restow the cargo below deck and had it off-loaded in preparation for restowage. While on the pier, the cargo was damaged beyond repair. Plaintiff owner sued the carrier for replacement cost of the cargo. The court held that the COGSA limitation applied from the time the goods are initially loaded at the port of embarkation until they are finally discharged from the ship at the port of disembarkation. Restowage does not constitute a discharge. Schramm, Inc. v. Shipco Transport, Inc., No. 03-1075 (4th Cir., April 15, 2004). (HK Law)

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