LIMITATION OF TIME: THE CONFLICTING REGIMES OF THE HAGUE AND HAMBURG RULES IN NIGERIA

Introduction

A contract of carriage of goods by sea is usually between the shipper and the ship owner or carrier. The terms of the contract of carriage are generally evidenced by a bill of lading. A bill of lading is a document issued by the ship owner to acknowledge receipt of cargo delivered to him for the purpose of carriage and the terms of the contract upon which the cargo is carried are incorporated in the bill of lading. The bill of lading is usually governed by a set of rules resulting from different United Nations International Convention[1].

In Nigeria, the Hague Rules 1924 and the Hamburg Rules 1978 are concurrently in force. The Carriage of Goods by Sea Act 2004 (COGSA) domesticated the Hague Rules. COGSA essentially covers only outgoing cargo and excludes import. Accordingly, before the existence of the uncertainty surrounding the determination of the legal regime, imports were governed by the contractually agreed carriage regime usually contained in the bill of lading.

The Hamburg rule was domesticated in Nigeria by the National Assembly as the UN Convention on the Carriage of Goods by Sea (Ratification and Enforcement) Act 2005 without a formal repeal of the COGSA. The Hamburg Rules being an attempt to form a uniform legal base for transportation of goods by sea applies to all carriage by sea contracts between two different states, provided that the ports of loading and discharge or the place where the bill of lading or other transport document was issued are in a contracting state- thus, the Hamburg Rules covers both inward and outward shipments of cargo.

Limitation of time to bring an action under Hague Rules

Pursuant to Article 3 rule 6 of the Hague rules[2], a notice of loss or damage must be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery or, in the case where the loss is not apparent, within three days. Where the cargo is removed, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading.

Article 3 rule 6 paragraph 4 further states that a ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one (1) year after delivery of the goods or the date when the goods should have been delivered.

It is settled law based on a lead judgement delivered by Justice Karibi Whyte in Kaycee Nig Limited V Prompt & Shipping Corporation[3] that the Hague Rules provided for a one year limitation only to claims which the notice of damage was brought within the three (3) days stated under the rules.

Limitation of time to bring an action under Hamburg Rules

Article 20 rule 1[4] of the states that:

“Any action relating to carriage of goods under this Convention is time-barred if judicial or arbitral proceedings have not been instituted within a period of two years”.

Just like the Hague rules, the Hamburg rules makes this Limitation of time subject to a notice of damage made in writing to the Carrier however the Hamburg Rules gives a shorter notice time – one working day[5].

Conflict on the applicable rules in Nigeria

Due to the continued co-existence of the Hamburg rules and Hague rules, there have been confusion among industry players such as ship owners, carriers, cargo owner, shippers and other key players regarding which regime is applicable.

Article 25, Rule 5 of the Hamburg Rules states that the Convention applies mandatorily to contracts of carriage in force as at the date of this Convention.

Article 31 of the Hamburg rules also provides that:

“Upon becoming a Contracting State to this Convention, any state party to the International Convention for the Unification of Certain Rules relating to Bills of Lading signed at Brussels on 25 August 1924 (1924 Convention) must notify the Government of Belgium as the depository of the 1924 Convention of its denunciation of the said Convention with a declaration that the denunciation is to take effect as from the date when this Convention enters into force in respect of that State.”

 The formal notification to the Government of Belgium of the denunciation of the Hague Rules has not been done by Nigeria, neither has the Hague Rules been repealed by the House of Assembly hence the reason for the continued uncertainty as regards the applicable legal regime for carriage of goods in Nigeria.

The Supreme Court in the case of IBIDAPO .v. LUFTHANSA AIRLINES[6] held that “Where it is intended to repeal a legislation, this should be expressly so stated as the Courts generally lean against implying the repeal of an existing legislation unless there exists clear proof to the contrary….The Court will not imply a repeal unless two Acts are so plainly repugnant to each other that effect cannot be given to each other at the same time. “Emphasis ours”

Drawing an inference from the above decision, it appears that, in there must be a formal repeal, except where the acts are so plainly repugnant.

The court seem to have followed this position. The Federal High Court in MEGAPLASTICS INDUSTRIES V MV KOTA HALUS Suit FHC/L/CS/1436/12, decision of Justice I N Buba questioned the applicability of the Hamburg Rules in Nigeria and applied the Hague Rules on the basis that they have not been denounced. The Court held that:

“it is trite law that he who asserts must prove. The burden is the Plaintiff/Respondent’s to establish that the Hamburg Rules have repealed the Hague Rules or that the Hague Rules have been repealed and therefore incapable of application to this matter“.

The Court stated that there was an absence of evidence that Nigeria has denounced the Hague Rules, the plaintiff cannot argue that the Hamburg Rules apply.

Construing the decision, the effect would mean that the Hague Rules continues to take effect in Nigeria and the Hamburg rules have no legal effect. Notwithstanding the foregoing, it is imperative to note that the above decision is a Federal High Court decision (court of 1^st Instance) and at best, same is only persuasive on other courts of coordinate jurisdictions. It is therefore possible that another court may take a different position on the application of Hamburg Rules where compelling arguments are canvassed on implied repealing of the Hague Rules whilst distinguishing the of IBIDAPO .v. LUFTHANSA AIRLINES and noting that the Hague Rules are inconsistent with the Hamburg rules thus falling under the exception stated by the supreme Court in Ibidapo v Luftansa Airlines.

Conclusion

The Current uncertain position on the applicable regime is clearly undesirable. The legislature is saddled with the responsibility of making laws and repealing same. Accordingly, it is best that the legislature repeals the Hague rules formally. The ministry of transportation must also take steps to notify the Government of Belgium of the denunciation of the Hague Rules with a declaration that the denunciation is to take effect as from the date when this Convention enters into force. Until this is done, there might be a recurring confusion as to which law is applicable to a contract of carriage by sea in Nigeria.

Author

Damilola Osinuga

Damilola.osinuga@famsvillesolicitors.com

[1] International Convention for the Unification of Certain Rulesof Law relating to Bills of Lading 1924; The Hague-Visby Rules – The Hague Rules as Amended by the Brussels Protocol 1968  United Nations Convention on the Carriage of Goods by Sea, which was adopted in Hamburg on March 31, 1978 and came into force on November 1, 1992 Hamburg rules, Hague rules and the Hague-visby rules

[2] The Carriage Of Goods By Sea (Ratification And Enforcement) Act 2004

[3] 1986 Vol 2 N.S.C 431

[4] UN Convention on the Carriage of Goods by Sea (Ratification and Enforcement) Act 2005 (Hamburg Rules)

[5] Article 19 Rule 1 of the Hamburg Rules

[6] (1997) 4NWLR (PART 498) 124 AT 163 PARAS. E-F