August 2017
If a bill of lading is printed with standard provisions, they are standard contract provisions and should be binding to the consignor, the shipper and the holder of the bill of lading except when such provisions are obviously unfair and should be deemed invalid(Taiwan)
Oli Wong
The Supreme Court rendered the 105-Tai-Shang-105 Civil Decision of January 20, 2016 (hereinafter, the "Decision"), holding that if a bill of lading is printed with standard provisions, they are standard contract provisions and should be binding to the consignor, the shipper and the holder of the bill of lading except when such provisions are obviously unfair and should be deemed invalid.
According to the facts underlying this Decision, Company A, which is not a party to this lawsuit, ordered 6,016 steel bars (the cargo at issue) from a vendor in Taiwan. After hiring Company B, the vendor entered into a time charter through Company B with another party to ship the cargo at issue through such vessel and Company B issued the bill of lading with Company A as the consignee. When the cargo at issue arrived, the cargo was found to have rust, oxidation and discoloration with residual water stain. After a surveyor's investigation, it turned out that the cargo at issued was soiled and damaged by sea water seeping into the carbo bay in the course of transportation because the rubber gasket under the hatch cover of the cargo bay in the vessel at issue was not elastic to the extent that the hatch could not be tightly closed. The Appellant in this case was the insurer of the maritime transportation of the cargo at issue and had indemnified Company A by the sum set forth in the insurance contract and thus received the transfer of such damage claim. The Appellant subsequently filed a complaint to assert the claim.
The original trial court held that the bill of lading was the proof of the shipping contract. Except when the provisions of the bill of lading are obviously invalid when they are subject to Article 247-1 of the Civil Code, they shall be appropriately presumed to be binding to the parties. The provisions printed on the back of the bill of lading at issue indicate that such bill of lading is governed by the Carriage of Goods by Sea Act 1936. Therefore, they are not obviously unfair. In addition, in reference to the gist of Article 43 of the Law Governing the Choice of Law in Civil Matters Involving Foreign Elements, the governing law of this matter concerning the shipping contract and the bill of lading should be the Carriage of Goods by Sea Act 1936.
The Supreme Court decision affirmed such opinion and pointed out that if a bill of lading is printed with standard provisions, they are standard contract provisions and should be binding to the consignor, the shipper and the holder of the bill of lading except when such provisions are obviously unfair and should be deemed invalid. Therefore, the original decision that held that the provisions printed on the back of the bill of lading at issue stipulate that the governing law shall be the Carriage of Goods by Sea Act 1936 was not inappropriate, and the Appellant's appeal was rejected.
The Supreme Court rendered the 105-Tai-Shang-105 Civil Decision of January 20, 2016 (hereinafter, the "Decision"), holding that if a bill of lading is printed with standard provisions, they are standard contract provisions and should be binding to the consignor, the shipper and the holder of the bill of lading except when such provisions are obviously unfair and should be deemed invalid.
According to the facts underlying this Decision, Company A, which is not a party to this lawsuit, ordered 6,016 steel bars (the cargo at issue) from a vendor in Taiwan. After hiring Company B, the vendor entered into a time charter through Company B with another party to ship the cargo at issue through such vessel and Company B issued the bill of lading with Company A as the consignee. When the cargo at issue arrived, the cargo was found to have rust, oxidation and discoloration with residual water stain. After a surveyor's investigation, it turned out that the cargo at issued was soiled and damaged by sea water seeping into the carbo bay in the course of transportation because the rubber gasket under the hatch cover of the cargo bay in the vessel at issue was not elastic to the extent that the hatch could not be tightly closed. The Appellant in this case was the insurer of the maritime transportation of the cargo at issue and had indemnified Company A by the sum set forth in the insurance contract and thus received the transfer of such damage claim. The Appellant subsequently filed a complaint to assert the claim.
The original trial court held that the bill of lading was the proof of the shipping contract. Except when the provisions of the bill of lading are obviously invalid when they are subject to Article 247-1 of the Civil Code, they shall be appropriately presumed to be binding to the parties. The provisions printed on the back of the bill of lading at issue indicate that such bill of lading is governed by the Carriage of Goods by Sea Act 1936. Therefore, they are not obviously unfair. In addition, in reference to the gist of Article 43 of the Law Governing the Choice of Law in Civil Matters Involving Foreign Elements, the governing law of this matter concerning the shipping contract and the bill of lading should be the Carriage of Goods by Sea Act 1936.
The Supreme Court decision affirmed such opinion and pointed out that if a bill of lading is printed with standard provisions, they are standard contract provisions and should be binding to the consignor, the shipper and the holder of the bill of lading except when such provisions are obviously unfair and should be deemed invalid. Therefore, the original decision that held that the provisions printed on the back of the bill of lading at issue stipulate that the governing law shall be the Carriage of Goods by Sea Act 1936 was not inappropriate, and the Appellant's appeal was rejected.
