that the owner or insurer of cargo damaged on ship A can recover only 25% of its
loss from ship B. If the Hague or Hague-Visby Rules apply to the carriage of the
cargo on ship A, the end result is that the cargo insurer can recover only 25% of its
loss, as it cannot recover the remaining 75% of its loss from ship A because of Art.
4, r. 2(a).
Why, then, the need for the Both-to-Blame Collision Clause? The usual answer is
that it is needed because of the position under the law in the United States,
50 which
has not adopted the 1910 Brussels Convention, and which continues to adhere to the
principle of joint and several liability in maritime cases. Under U.S. general maritime
law, multiple tortfeasors are jointly and severally for the harm they cause, which
means that a cargo owner (or its insurer) may recover the whole of its loss from the
non-carrying ship in a both-to-blame collision.
51 The non-carrying ship may then
recover from the carrying ship a proportion of the amount it had to pay the cargoowner, on the basis that its liability to the owner or insurer of the cargo on the
carrying ship was one of the losses it suffered as a result of the collision. The net
effect is that the carrying ship ends up being liable for part of the cargo-owner’s loss,
notwithstanding the protection of Art. 4, r. 2(a) of the Hague Rules.
52
It was for this situation that the Both-to-Blame Collision Clause was devised. A
typical clause provides that if the carrying ship is held to be liable to the non-carrying
ship for cargo damage on the carrying ship suffered in a both-to-blame collision, the
cargo-owner is obliged to indemnify the carrier to the extent of that liability.
Returning to the example used above, the owner or insurer of the cargo damaged
on ship A can recover 100% of its loss from ship B, which can then recover 75% of
that amount from ship A,
53 which can then claim an indemnity for that sum from the
cargo owner or insurer, thus closing the circle. The intended end result is the same as
under the 1910 Brussels Collision Convention and Art. 4, r. 2(a) of the Hague or
Hague-Visby Rules: ship B bears 25% of the loss, ship A bears none, and the owner
or insurer of the cargo bears 75%.
The problem with all of this is that the U.S. Supreme Court, no less, has held that
the Both-to-Blame Collision Clause is not effective in contracts to which COGSA
applies. In U.S. v. Atlantic Mutual Insurance Co.,
54 the Supreme Court declared the
Both-to-Blame Collision Clause to be invalid and unenforceable in cases governed
50 For example, BIMCO’s Explanatory Notes to the NYPE 2015 Time Charter state, in relation to
the Both-to-Blame Collision Clause (cl. 33(b)): “This clause is of particular importance when the
law of the United States may apply to apportioning liability for a collision between two ships where
both ships have acted negligently to cause the casualty”: see BIMCO (2016), p. 31.
51 The Atlas, 93 U.S. (3 Otto) 302, 23 L.Ed. 863 (1876); The Chattahoochee, 173 U.S. 540; 19 S.Ct.
491; 43 L.Ed. 801 (1899); The New York, 175 U.S. 187; 20 S.Ct. 67; 44 L.Ed. 126 (1899); Allied
Chemical Corp. v. Hess Tankship Co., 661 F.2d 1044 (5th Cir., 1981).
52 Carriage of Goods by Sea Act (COGSA), § 4(2)(a), Statutory Note to 46 U.S.C. § 30701.
53 Liability for a maritime collision is apportioned by degrees of fault in the United States: see U.S.
v. Reliable Transfer Co., Inc., 421 U.S. 397, 1975 AMC 541 (1975).
54 343 U.S. 236; 72 S.Ct. 666; 96 L.Ed. 907 (1952). This case is known, but not reported, as The
Esso Belgium.
When Was the Last Time You Were Restrained by a Prince? Conservatism. . .
163
loss from ship B. If the Hague or Hague-Visby Rules apply to the carriage of the
cargo on ship A, the end result is that the cargo insurer can recover only 25% of its
loss, as it cannot recover the remaining 75% of its loss from ship A because of Art.
4, r. 2(a).
Why, then, the need for the Both-to-Blame Collision Clause? The usual answer is
that it is needed because of the position under the law in the United States,
50 which
has not adopted the 1910 Brussels Convention, and which continues to adhere to the
principle of joint and several liability in maritime cases. Under U.S. general maritime
law, multiple tortfeasors are jointly and severally for the harm they cause, which
means that a cargo owner (or its insurer) may recover the whole of its loss from the
non-carrying ship in a both-to-blame collision.
51 The non-carrying ship may then
recover from the carrying ship a proportion of the amount it had to pay the cargoowner, on the basis that its liability to the owner or insurer of the cargo on the
carrying ship was one of the losses it suffered as a result of the collision. The net
effect is that the carrying ship ends up being liable for part of the cargo-owner’s loss,
notwithstanding the protection of Art. 4, r. 2(a) of the Hague Rules.
52
It was for this situation that the Both-to-Blame Collision Clause was devised. A
typical clause provides that if the carrying ship is held to be liable to the non-carrying
ship for cargo damage on the carrying ship suffered in a both-to-blame collision, the
cargo-owner is obliged to indemnify the carrier to the extent of that liability.
Returning to the example used above, the owner or insurer of the cargo damaged
on ship A can recover 100% of its loss from ship B, which can then recover 75% of
that amount from ship A,
53 which can then claim an indemnity for that sum from the
cargo owner or insurer, thus closing the circle. The intended end result is the same as
under the 1910 Brussels Collision Convention and Art. 4, r. 2(a) of the Hague or
Hague-Visby Rules: ship B bears 25% of the loss, ship A bears none, and the owner
or insurer of the cargo bears 75%.
The problem with all of this is that the U.S. Supreme Court, no less, has held that
the Both-to-Blame Collision Clause is not effective in contracts to which COGSA
applies. In U.S. v. Atlantic Mutual Insurance Co.,
54 the Supreme Court declared the
Both-to-Blame Collision Clause to be invalid and unenforceable in cases governed
50 For example, BIMCO’s Explanatory Notes to the NYPE 2015 Time Charter state, in relation to
the Both-to-Blame Collision Clause (cl. 33(b)): “This clause is of particular importance when the
law of the United States may apply to apportioning liability for a collision between two ships where
both ships have acted negligently to cause the casualty”: see BIMCO (2016), p. 31.
51 The Atlas, 93 U.S. (3 Otto) 302, 23 L.Ed. 863 (1876); The Chattahoochee, 173 U.S. 540; 19 S.Ct.
491; 43 L.Ed. 801 (1899); The New York, 175 U.S. 187; 20 S.Ct. 67; 44 L.Ed. 126 (1899); Allied
Chemical Corp. v. Hess Tankship Co., 661 F.2d 1044 (5th Cir., 1981).
52 Carriage of Goods by Sea Act (COGSA), § 4(2)(a), Statutory Note to 46 U.S.C. § 30701.
53 Liability for a maritime collision is apportioned by degrees of fault in the United States: see U.S.
v. Reliable Transfer Co., Inc., 421 U.S. 397, 1975 AMC 541 (1975).
54 343 U.S. 236; 72 S.Ct. 666; 96 L.Ed. 907 (1952). This case is known, but not reported, as The
Esso Belgium.
When Was the Last Time You Were Restrained by a Prince? Conservatism. . .
163