International Commercial LawAssessment: Problem Question

Problem-Question Scenario:

Assume Ever Green (EG) and Sustainable Shipping (SS) from Paragon concluded a contract for the delivery of ‘Oxfam Products' (OP) at two different ports: ‘Barsha' and ‘Bari' of Garcia, an independent state. Both countries are parties to relevant international conventions regarding carriage of goods by sea and belong to the common legal system. According to the contract SS was required to deliver two containers in Barsha and three containers in Bari and all five containers (owned by EG) were insured with the Smart Insurance Limited (SIL). OP were not listed as ‘dangerous goods' under the International Maritime Dangerous Goods Code but contained a liquid substance which required specific arrangements employed in the ship and careful handling. On arrival at Barsha, it was found that most of the OP was damaged, partly because of the pressure on the containers placed directly above them and rough movements of the containers. There was conclusive evidence that damage to the containers of OP happened after they were loaded. EG claimed that the lack of special shipping arrangements and reckless handling of the vessel caused the damage and the ship was not shipworthy. SS contested the allegation, arguing that the reason was ‘bad stowage'. EG attempts to recover the loss from SIL as well. SIL denies EG's claims for recovery, arguing that it was not aware of the special nature of OP, and had it been aware, it would have drafted its insurance policy differently.

In addition, the delivery of the three containers were adversely affected by anunfortunate event. The containers were not delivered by the agreed time due to a sudden strike at Bari. The containers were lost as a result of a collisionbetween SS's vessel and another vessel when SS'svessel was waiting to be pulled into its berth. SS wanted to avoid the obligation by contending that EG failed to exercise due diligence in nominating a safe port. EG, however, managed to recover the total loss from SIL. Subsequently the lost containers were recovered and abandoned to SIL. SIL sold those containers for an amount greater than that paid to EG. EG now wishes to lodge a legal claim against SIL to get the extra money back for its containers.

Answer the following:

1. What are the possible legal issues raised in the above scenario from the perspective of an international contract of carriage of goods by sea? Identify and examine briefly specific laws, international standards and judicial decisions that can be relevant to adequately deal with those issues.

2. What grounds does EG need to establish to be awarded suitable remedies? Substantiate your argument by relying on relevant standards/laws and judicial decisions.

3. Do you think SIL has a chance of succeeding in a legal battle? Why or why not? Defend your views with special reference to legal and judicial authorities.

4. Evaluate the liabilities of SS in both cases as raised in the scenario. Advise SS of its immunities if any.