pi_circular Container Cargo riskInsurance & claims Skuld
The Chinese Supreme Court has considered the issue of responsibility for container detention charges, when the cargo is abandoned. Operators in the container sector with China trade will wish to take note of this legal development. Cargo operations in China (Source: Andrew Moore & Associates) Container detention charges Abandoned cargo and containers are a perennial issue for the box-ship trade. For some reason, typically economic, the designated receiver fails to pick up the box and it then becomes an issue, incurring continued charges for storage, charges for the use of the box, as well as liabilities for the contents and their possible disposal. There are also other reasons for boxes being abandoned, and these can prove more problematic. It has been noted that at times containers are used for smuggling purposes or contain illegal waste products. When such containers are abandoned they are unlikely to contain anything that could be auctioned off for an off-set against the cost of storage and disposal, or indeed any fines that the authorities may impose. Who then has to take the responsibility can become a complex matter, as there are multiple parties involved, including the shipper, the freight forwarders, local shipping agents, the vessel, her operators and possibly further NVOCC(s). The parties will be linked by contracts, including charters, but also bills of lading (and indeed possibly multiple sets of bills of lading, with differing terms). Chinese legal development In a recent decision before the Chinese Supreme Court, a matter was determined as to who would bear the risk and cost of container detention charges. The case involved a claim between a carrier and a consignor. A container had been abandoned and very substantial charges were incurred which could not be offset by the sale of the contents. The course of this litigation included two appeals, culminating in a decision by the Supreme Court, which placed liability on to the consignor in circumstance
Container detention charges
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