Ship Lawyer Cargo Claims and Liability 1 â Questions and Answers
Question 1: Under the US Carriage of Goods by Sea Act (COGSA), what is the maximum carrier liability per package for cargo loss or damage when no higher value is declared?
- $250 per package
- $500 per package (Correct answer)
- $1,000 per package
- $2,500 per package
Correct answer: $500 per package
COGSA § 4(5) limits carrier liability to $500 per package or customary freight unit unless the shipper declares a higher value and pays additional freight.
Question 2: What is the statute of limitations for filing a cargo damage lawsuit against a carrier under COGSA?
- 6 months from delivery
- 1 year from delivery (Correct answer)
- 2 years from delivery
- 3 years from delivery
Correct answer: 1 year from delivery
COGSA requires suit to be brought within one year after delivery of the goods or the date when delivery should have occurred, mirroring the Hague Rules time bar.
Question 3: Which document serves as the primary evidence of the contract of carriage, receipt of goods, and in negotiable form, title to the cargo?
- Charter party
- Bill of lading (Correct answer)
- Cargo manifest
- Freight invoice
Correct answer: Bill of lading
The bill of lading is the foundational shipping document that evidences the contract of carriage between shipper and carrier and, when negotiable, represents title to the goods.
Question 4: Under the US Fire Statute (46 U.S.C. § 30504), under what circumstance is a carrier liable for cargo damage caused by fire aboard the vessel?
- Whenever fire results in any cargo damage
- Never, because fire is always an act of God
- Only when the fire was caused by the carrier's own design or neglect (Correct answer)
- Only when the fire originates in the cargo hold
Correct answer: Only when the fire was caused by the carrier's own design or neglect
The US Fire Statute shields carriers from liability for fire-related cargo damage unless the claimant proves the fire was caused by the carrier's actual fault or privityâi.e., design or neglect.
Question 5: What does the term 'inherent vice' mean as a carrier defense in a cargo damage claim?
- A manufacturing defect in the ship's cargo-handling equipment
- A natural characteristic of the cargo that causes it to deteriorate without any external cause (Correct answer)
- A hidden contractual defect in the bill of lading terms
- A breach of the carrier's duty to properly stow the cargo
Correct answer: A natural characteristic of the cargo that causes it to deteriorate without any external cause
Inherent vice refers to a quality intrinsic to the cargo itselfâsuch as perishability or self-heatingâthat causes it to damage or deteriorate regardless of how carefully the carrier handles it.
Question 6: To establish a prima facie case for cargo damage under COGSA, what must the claimant demonstrate?
- That the carrier was negligent in stowing or handling the cargo
- That the cargo exceeded the weight limits specified in the bill of lading
- That the cargo was delivered to the carrier in good condition and arrived at destination in damaged condition (Correct answer)
- That the carrier violated the seaworthiness warranty throughout the voyage
Correct answer: That the cargo was delivered to the carrier in good condition and arrived at destination in damaged condition
A prima facie case requires showing delivery of cargo in good condition and outturn in damaged condition; this shifts the burden to the carrier to prove an excepted peril or absence of negligence.
Question 7: What is a 'clean bill of lading' in ocean cargo shipping?
- A bill of lading that has been cleared by customs authorities at the port of loading
- A bill of lading issued without any notations indicating damage, shortage, or defects in the cargo received (Correct answer)
- A bill of lading covering hazardous materials that have been properly declared and approved
- A digitally authenticated and encrypted electronic bill of lading
Correct answer: A bill of lading issued without any notations indicating damage, shortage, or defects in the cargo received
A clean bill of lading contains no clauses or notations noting that the cargo was received in damaged, defective, or incomplete condition, creating a presumption of good receipt.
Ship Lawyer Cargo Claims and Liability 1
Under the US Carriage of Goods by Sea Act (COGSA), what is the maximum carrier liability per package for cargo loss or damage when no higher value is declared?