Court case 1

Case name: STANDARD BRANDS, Inc., v. NIPPON YUSEN KAISHA et al.

Date: November 19, 1941.
Plaintiff: Standard Brands
Respondents: Nippon Yusen Kaisha, Boston Terminal
Analysis of case: (summarize the case, rules or shipping act used, final judgment)
On the morning of November 3
rd
, 1939, Friday, the S. S. "Arima Maru" arrived at the
Army Base Pier, Boston, and immediately began unloading. Notice of its arrival was sent
to the plaintiff that day.
The unloading, which was conducted by stevedores employed by agents of the
respondent, was not completed until 11 A. M. of the following day, which was a
Saturday, November 4
th
. The consignee was not present or in any way represented at the
unloading operations. The tea was placed in a storage shed on the wharf, the use of which
was provided to the respondent for six days without storage charge as an incident to their
docking accommodations.
The tea was placed on the floor of the shed about two feet away from a sliding door
which was some twenty-five feet wide, and which opened out onto the wharf facing
north. This door opened and closed by sliding it up and down. Due to some defect, it
could never be completely shut, so that when it was pulled down as far as it would go
there remained a gap about two inches wide between the bottom of the door and the floor.
The only protection beneath plaintiff's cargo, separating it from direct contact with the
floor, was a thin layer of sawdust.
On the Sunday night, November 5
th
, the plaintiff's tea was damaged by a large quantity of
water seeping underneath the door during a storm. The wind, blowing from the northeast
during a heavy rainstorm, was one of the severest ever recorded in Boston, reaching a
velocity at one time of fifty-six miles per hour. Efforts were made to stop the seepage of
water by placing sawdust bags along the bottom of the door, but without success. On
other occasions water had leaked underneath this door.
NYK, the respondent contends that it cannot be held liable, first, because its liability as a
common carrier had terminated under the terms of the bill of lading; second, because
there was no negligence on its part causing the damage; and, third, because the damage
was the result of an "act of God".
It is true that, under the bill of lading involved, the respondent's liability as a common
carrier had ceased on discharge of the cargo from the ship. However, according to the
local admiralty law of U.S, where the consignee is not present to accept immediate
delivery of the goods, regardless of the form of the contract of carriage, the carrier cannot
exempt itself from its negligence in exposing goods to loss or damage after discharge
from its ship. Until receipt by the consignee, the carrier, despite any terms to the contrary
in its bill of lading, continues to hold goods unloaded by it as a financial guarantee. Or, as
some cases have put it, where, by the terms of the bill of lading, the contract of carriage
terminates on discharge of the cargo from the ship, its liability changes from that of a
common carrier to that of a warehouseman, and, as such, it is bound to exercise ordinary
care in the protection of the goods.
The plaintiff was not negligent in failing to seasonably remove its shipment of tea. The
unloading operation continued until almost noon on Saturday, and it was reasonable for
the consignee to wait over the weekend before coming to get its goods since they were
not perishable, and it probably knew that the respondent was allowed six days free use of
the storage sheds on the wharf where the ship docked.
On the other hand, placing the tea on the floor within two feet from a door which could
not be properly closed, and under which water had leaked on previous occasions, was
certainly not exercising the degree of ordinary care which would be expected of any
warehouseman for hire. Heavy rains are to be expected at the time of year when this
damage occurred. A reasonable amount of precaution in blocking the gap under this door,
or placing elevating supports under these chests, or placing them far enough away from
the door so as to be free from seepage water, would have prevented the damage. The
contention of respondent that the damage was occasioned by an "act of God" is without
merit, since, the injury could have been avoided by precaution.
The final judgment is that the respondent was negligent in failing to properly care for the
plaintiff's consignment of tea. The plaintiff is entitled to recover from the respondent the
sum of $295.20.

Strategic analysis: (compare the differences in monetary value if different rules to be
used for the similar cases (only for that particular section under the rules used), e.g. if
now NYK follow Hague-Visby Rules, What will be the compensation, liability or
punishment when compare to Hamburg Rules and soso) In my case, as it used the local
rules, so I have to compare the value if the case is using Hague-Visby Rules.
At that time, both U.S and Japan did not sign the Hague-Visby Rules and the forum in
which the dispute was litigated was in U.S. Thus, local admiralty law of U.S is used to
make the judgment due to no other choices. For this case, the NYK is considered win the
court case by shifting the liability to Boston Terminal. If NYK is held liable, it has to pay
$295.20 to recover lost of the plaintiff, Standard Brands. If NYK is going to compensate
under Hague-Visby Rules which it ratified in 1979, it has to pay around SDR 10,000.







Recommendation: (it is the same at which we compare the differences between the rules
used for that particular section under those rules, for my case is carrier liability and
compensation compared between Hague-Visby and Hamburg Rules..e.g. if ur case used
Hamburg rules, u will compare it with Rotterdam rulesand finally give
recommendation, whether NYK which come under NYK, should sign higher rules or not,
like Hague-Visby rules -> Hamburg Rules)
Since Japan ratifies Hague-Visby Rules in year 1979, if similar cases happened again and
NYK is held liable, the compensation will be SDR 2 per kilogram or SDR 667 per
package, whichever is higher. For comparison purpose, if Japan chooses to sign
the Hamburg Rules, the compensation would become SDR 2.5 per kilogram or
SDR 835 per package.
Under Hamburg Rules, the carrier is liable for the risk in goods from the moment
the goods are put under his or her care until the time they are delivered as
agreed. This means as long as the consignee have not recognize the successful
of delivery, NYK is still held liable even it shifted the responsibility to the Boston
Terminal. However, in Hague-Visby Rules, the carrier only liable for the risk in
goods during the carriage of goods- the period after the goods pass the ships
rail for loading and before the goods pass the ships rail for discharged. For
similar case, NYK would not longer to be held liable once the goods are
discharged completely at the Boston Terminal.
Therefore we recommend that Japan only stick with the Hague-Visby Rules
instead of upgrading it into Hamburg Rules since it is not good for the NYK, one
of the biggest shipping companies in Japan.