CMA CGM unsuccessful in fire damages claim.

(From Lloyds List)

Byline: Ruling gives new guidance on interpreting 1976 Convention on Limitation of Liability, writes Roger Pearson

A TIME charterer has failed in a High Court bid to limit a $26,638,032 fire damage claim by the owner of the vessel it chartered.

The claim followed a fire in 1999 in which the containership, CMA Djakarta, which was chartered to CMA CGM by Classica Shipping caught fire after an explosion said to have been caused by bleaching powder being shipped in two of the containers on board. Classica claimed that the bleach was a 'dangerous cargo' and that shipping it was in breach of the terms of the charterparty.

Arbitrators found in favour of Classica but CMA CGM appealed, claiming its liability should be limited under the terms of the 1976 Convention on the Limitation of Liability for Maritime Claims.

Now, in a decision which gives new guidance on interpretation of the limitation terms at the centre of the dispute, Mr Justice David Steel has rejected CMA CGM's challenge.

Article 1 of the convention stipulates that shipowners and salvors may limit their liability and defines the term 'shipowner' as meaning the 'owner, charterer, manager or operator of a seagoing ship'.