losses which were due to manhandling and therefore the insurer refused to settle the claim, Introductio1 © The globalization of foreign economies, international economic integration, elimination of trade barriers, and increased competition has significantly increased business dependence on transport. The order to transport goods from one location to another, a carriage contract must be entered into. The association or organizations performing the trade of transport are called carriers. Whether by land or water or via an air transport network goods can be carried through transportation means. The movement of cargo through two or more modes of transport is called multimodal transport The need to move goods from one location to another can not be overemphasized in any country's commercial life. Goods must also be shipped from country to country. A carriage contract shall be concluded for these purposes. The individuals, organizations, or associations carrying goods are referred to as carriers. Goods may be transported by land, sea, or air, including inland waterways. The legislation on the movement of goods is, therefore, included in the following provisions: A. For the transport of goods by land: (i) The Carriers by Road Act, 2007. (ii) The Railways Act, 1890. B. In the event of goods being transported by sea: (i) The (Indian) Bills of Lading Act, 1856. (il) ‘The Carriage of Goods by Sea Act, 1925. (ii) ‘The Merchant Shipping Act, 1958. (iv) The Marine Insurance Act, 1963. €. For the transport by air of goods: The Carriage by Air Act, 1972. A. Carriage of goods by land: ‘As mentioned above, the following two statutes (Law) govern the carriage of goods by land: (i) The Carriers by Road Act, 2007. (i) The Railways Act, 1890. According to the Carriage by Road Act, a common carrier can either be an individual, person or an organization, which carries out the trade of transportation over the land or inland waterways for the purpose of raising money. 23 Downloaded by Shinjnee Namhata (shinjin rnarnhata@[Link])A private carrier is defined as an entity which carries its own goods or the goods of selected persons. Private carriers are governed by the Indian Contract Act rather than the Carriage by Road Act, 2007. ‘The Carriage by Road Act, 2007 was passed to revise the then obsolete Carriers Act, 1865. The act deals with the regulation of common carriers, limiting their liability and declaration of value of goods delivered to them to determine their liability for loss or damage to such goods due to the negligence or criminal acts carried out by themselves, their servants or agents. © Except Jammu and Kashmir, the act applies to the whole of India. ights of a Common Carrier: His rights are: (i) He is entitled to the settled remuneration and in case no remuneration was settled, to a reasonable remuneration. (ii) He has a right to refuse to carry goods under certain circumstances (as enumerated under the duties of a common carrier). (iii) He has a lien on the goods for his remuneration. He can refuse to deliver them until his charges are paid. (iv) If the consignee refuses to take delivery of the goods, when tendered, the common carrier has a right, to deal with the goods as he thinks reasonable and prudent under the circumstances (v) He has a right to recover reasonable expenses incurred by him as a result of the consignee’s refusal to take delivery. After giving notice to the consignee, the common carrier may even sell perishable goods. (vi) He can recover damages from the consignor if the goods are dangerous or are loosely packed and the carrier suffers injury therefrom. (vii) He can limit his liability subject to the provisions of the Carriers Act. Duties of a Common Carrier. His duties ar 1. A common carrier is bound to carry goods of all persons who choose to employ him. He can, however, refuuse to carry goods under the following circumstances: (a) if there is no accommodation in the carriage; (b) if the person employing him is not willing to pay reasonable charges for the carriage of goods; (c) if the goods are such which he is not accustomed to cany; (@) if the goods are to be carried over a route which is not his regular route; (@) if the goods are-dangerous and as such subjecting him to extraordinary risk (0) ifthe consignor refuses to disclose the nature of the goods to be carried; and (g) if the goods are not properly packed. Ifa carrier refuses to carry the goods of a person for any reason other than those mentioned above, he may be held liable for damages. Downloaded by Shinjnee Namhata([Link]@gmailcom)2. He must cany the goods over the usual and customary route and take all reasonable precautions for their safe carriage. He must not deviate from the usual route unless rendered necessary by exceptional circumstances. 3. He must deliver the goods at the agreed time and if no time had been fixed, within a reasonable time. 4, At Common Law, he is an insurer of the goods in the sense that he warrants to carry the goods safely and securely. abilities of a Common Carrier: The liability of a common carrier of goods is laid down in the Carriers Act, 1865. For this purpose, the Act has classified the goods into two categories: (i) Scheduled goods and (ii) non-scheduled goods Scheduled goods The scheduled goods are those which are enumerated in a Schedule to the Act. They are valuable articles like gold, silver, precious stones and pearls, bills and hundis, currency and bank notes, glass, china silk, articles of ivory, time pieces, musical and scientific instruments, ete. All other goods are non-scheduled. For scheduled articles exceeding Rs. 100 in value, the carrier is liable for loss and damage only: (i) ifthe value and the description of the goods are disclosed by the consignor to the carrier; or (ii) if the loss or damage is due to a criminal act of the carrier, his agent or servant. The carrier can charge extra for carrying scheduled articles, but he cannot limit his statutory liability by any special agreement. Non-Scheduled goods: As regards non-scheduled articles, a common carrier can limit his liability by spe agreement with the consignor. But even in this Section case he will be liable under 8 of the Act (explained below). In case of loss or damage, the claimant must notify the carrier within six months of the date of knowledge of the loss or damage Carriage of Goods by Rail: The carriage of goods by rail is regulated by the Railways Act, 1989. 1. Maintenance of rate books, etc, for carriage of goods (Section 61): Every railway administration shall maintain, at each station and to such other places where goods are received for carriage, the rate books or other documents which shall contain the rate authorised for the carriage of goods from one station to another and make them available for the reference of any person during all reasonable hours without payment of any fee. Provision_of rate risks (Section 63): Where any goods are entrusted to a railway administration for carriage, such carriage shall, except where owner’s risk rate is applicable in respect of such goods, be at railway risk rate. Any goods, for which owner’s risk rate and railway risk rate are in force, may be entrusted for carriage at either of the rates and if no rate is opted, the goods shall be deemed to have been entrusted at owner’s risk rate. Downloaded by Shinjnee Namhata (shinjin rnarnhata@[Link])3. Forwarding note (Section 64): Every person entrusting any goods to a railway administration for carriage shall execute a forwarding note in such form as may be specified by the Central Government. The consignor shall be responsible for the correctness of the particulars furnished by him in the forwarding note. He shall indemnify the railway administration against any damage suffered by it by reason of the incorrectness or incompleteness of the particulars in the forwarding note. 4, Railway receipt (Section 65): A railway administration shall issue a railway receipt in such form as may be specified by the Central Government: a) ina case where the goods are to be loaded by a person entrusting such goods, on the completion of such loading; or b) in any other case, on the acceptance of the goods by it. A railway receipt shall be prima facie evidence of the weight and the number of packages stated therein 5. Carriage of dangerous or offensive goods (Section 67). No person shall take with him on a railway or require a railway administration to carry such dangerous or offensive goods, unless a) he gives a notice in writing of their dangerous or offensive nature to the railway servant authorised in this behalf; and b) he distinctly marks on the outside of the package containing such goods their dangerous of offensive nature. 6. Liability of railway administration for wrong delivery (Section 80). Where a railway administration delivers the consignment to the person who produces the railway receipt, it shall not be responsible for any wrong delivery on the ground that such person is not entitled thereto or that endorsement on the railway receipt is forged or otherwise defective. of a Railway Administration as a Carrier of Goods, Sections 93 to 112 of the Railways Act, 1989 General responsibility of a railway administration as carrier of goods (Section 93). A railway administration shall be responsible for the loss, destruction, damage or deterioration in transit, or non-delivery of any consignment (goods entrusted to a railway administration for carriage), arising from any cause except the following, namely: @ (ii) (iii) an act of public enemies; (iv) arrest, restraint or seizure under legal process; (v) orders of restrictions imposed by the Central Goverment or a State Government or by an officer or authority subordinate to the Central Government or a State Government authorised by it in this behalf; (vi) act of omission or negligence of the consignor or consignee endorsee or the agent or servant of the consignor or the consignee or the endorsee; (vii) natural deterioration or wastage in bulk or weight due to inherent defect, quality or vice of the goods; (viii) latent defects; Downloaded ay Shinjnee Namhata([Link]@gmailcom)(ix) fire, explosion or any unforeseen risks. Liability of a_common carrier vis-a-vis the liability of a railway administration. The liability of a railway administration is the same as that of a common carrier. + In case of Union of India v Orissa Textile Mills, AIR (1979) Ori. 165, even where any loss, destruction, damage, deterioration or non-delivery is proved to have arisen from any one or more of the aforesaid nine cases, a railway administration shall not be relieved of its responsibility unless it further proves that it has used reasonable foresight and care in the carriage of the goods. A railway administration, like a common carrier, is bound to carry the goods of every person who is willing to pay the freight and comply with other requirements. Delay or retention in transit (Section 95): A railway administration shall be responsible for the loss, destruction, damage or deterioration of any consignment proved by the owner to have been caused by the delay or detention in their carriage. The railway administration can, however, avoid liability if it proves that the delay or detention arose for reasons beyond its control or without negligence or misconduct on its part or on the part of any of its servants. Owner’s risk rate or railway risk rate (Section 97): A consignment may be carried by a railway administration either at owner's risk rate or railway risk rate. Owner's risk rate is a special reduced rate whereas railway risk rate is an ordinary tariff rate. Owner's risk rate is lower than the railway risk rate for the simple reason that the goods in this case are carried at the owner’s risk, In case of owner's risk rate, the railway administration is not responsible unless it is proved that any loss, destruction, damage or deterioration or non-delivery of goods arose from negligence or misconduct on the part of the railway administration or its servants. 4, Liability for damage to goods in defective condition or defectively packed (Section 98): Goods tendered to a railway administration to be carried by railway may be a) ina defective condition or b) defectively packed. * Asa result of these, goods are liable to damage, deterioration, leakage or wastage. * If the fact of such condition or defective or improper packing has been recorded by the sender or his agent in the forwarding note, the railway administration is not responsible for any damage, deterioration, leakage or wastage unless negligence ot misconduct on the part of the railway administration or of its servants is proved. Liability after termination of transit (Section 99): Whether the goods are carried at owner's risk rate or railway risk rate, the liability of the railway administration for any loss of goods within a period of seven days after the termination of transit is that of a bailee under Sections 151, 152 and 161 of the Indian Contract Act, 1872 But where the goods are carried at owner's risk rate the railway administration is not liable for such loss, destruction, damage, deterioration or non-delivery of goods Downloaded by Shinjnee Namhata([Link]@gmailcom)except on proof of negligence or misconduct on the part of the railway administration or any of its servants. After seven days from the date of termination of transit the railway administration is not liable in any case for any loss of such goods Notwithstanding this provision, the railway administration is not responsible after the termination of transit for the loss, destruction, damage, deterioration or non-delivery of articles of perishable goods, animals, explosives and other dangerous goods. Responsibility as carrier of luggage (Section 100): A railway administration shall not be responsible for the loss, destruction, damage, deterioration or non-delivery of any Iuggage unless a railway servant has booked the luggage and given a receipt therefor. It is to be proved that the loss, etc., was due to the negligence or misconduct on the part of the railway administration or on the part of any of its servants, In the case of luggage which is carried by the passenger in his own charge, the railway administration shall not be responsible for the loss, etc., unless it is proved that the loss, etc., was due to the negligence or misconduct on the part of the railway administration or on the part of any of its servants 7. Responsibility as a carrier of animals (Section 101): A railway administration shall not be responsible for any loss or destruction of, or injuries to, any animal carried by railway arising from fright or restiveness of the animal or from overloading of wagons by the consignor. 1, A.S. Navigation Co. ys. Jethala AIR 1959 Cal 479 Facts: The whole consignment of tobacco was reduced to a charred mass by spontaneous combustion caused by the presence of water and moisture in the tobacco Held: The effective and proximate cause of the damage was found to be due to the careless and negligent stowing of the goods by the cartier and the carrier was held liable for the loss. If the loss or damage arises from the neglect, fault or failure in the duties and obligations as provided in the statutory Articles or rules then a clause in the bill of lading exempting the cartier from liability for such loss and damage would be null and void and of no effect. 2, Bharathi Knitting Co. vs. DHL Worldwide Express Courier (1996) 4SCC 704 Issue: The Supreme Court was called upon to decide the possibility of awarding damages in excess of the agreed limitation of liability of the carrier under the contract. Held: The parties having agreed to the terms restricting the liability of the carrier, are bound by the same. 3M Downloaded ay Shinjnee Narhata([Link]@gmailcom)Facts: A transformer was damaged during transit by toppling down from the trailer. The vehicle carrying the transformer, had inadequate carrying capacity compared to the weight of the transformer. Held: The transporter was negligent in handling the transformer and was liable to pay damages. 4. i i 329 HQ) Facts: The Plaintiff has entrusted certain automobile spare parts to the Defendant, who is a public carrier to be transported to Jamshedpur. The spare parts were not received on account of the murder of the driver and the cleaner of the container. Held: On consideration of the evidence on record, it was held that the Defendant was not liable to pay the amount claimed in the suit, as per Clause 17 of the Carriage by Road Act, 2007, i.e. if a loss has been occasioned by a public enemy, the common carrier is not liable. B. Carriage of goods by Sea: Contract of Affreightment - A contract to cary goods by sea is called the “contract of affreightment” and the consideration or charges paid for the carriage is called the “freight”. © Acontract of affreightment may take either of the two forms, namely— (i) A charter party, where an entire ship, or a principal part of a ship is placed at the disposal of merchant (known as a charterer); or (ii) A bill of lading where the goods are to be carried in a general ship and the person consigning the goods is known as a shipper. * In both these contracts, the ship owner (the carrier) undertakes the responsibility of carrying the goods of a consignor (i.e., either the charterer or the shipper) safely and securely to the destination. ‘The terms included in a contract of carriage by sea are of two kinds. These are: (@® Express terms - Express terms are those which the parties have specifically agreed to and embodied in the contract, Implied terms - Implied terms are those which law implies in every contract of carriage by sea unless excluded specifically. There are four implied terms: (i) Implied_warranty of seaworthiness - The ship owner, when he enters into a charter — party for a voyage impliedly warrants that the ship is seaworthy. This is an assurance by the ship owner, at the time of entering into the charter party, that the ship is fit to encounter the ordinary perils of navigation during voyage and to carry the specific cargo. This warranty of seaworthiness extends only to seaworthiness at the time of sailing and fitness at the time of loading the cargo. Once the ship has sailed of the goods are on board, this warranty ceases to operate. 29 Downloaded by Shinjnee Namhata([Link]@gmailcom)