Ekinciler Dis Ticaret AS, a Turkish corporation, shipped 524,442,868 mts of hot rolled deformed reinforcing steel bars in 2,626 bundles on the Ebn Al Waleed from Iskenderun, Türkiye, to Sorel, Quebec. The Ebn Al Waleed was owned by Egyptian Navigation Co of Alexandria (the defendant). Some of the cargo was delivered to Barzelex Inc (the plaintiff) in a damaged condition, and the plaintiff estimated its damages at CAD 570,000, plus interest and costs.

The defendant took the position that even if it was liable to the plaintiff, which it did not admit, its liability was limited to TRY 100,000 per package or unit, the Canadian equivalent of which was CAD 2.30. The defendant submitted that although the Hague Rules were ratified by Türkiye in 1955, they only became an effective part of Turkish law, as incorporated into the Turkish Commercial Code (the Code), from 4 January 1956. The package or unit limitation was then set at TRY 1,500. In 1983, the Code was amended, and by art 1114 of the Code, the package or unit limitation was increased to TRY 100,000. Thus, the package or unit limitation in accordance with the laws in force in Türkiye on a bill of lading shipment from a port in Türkiye to a port outside Türkiye was TRY 100,000. By contrast, the plaintiff submitted that Türkiye had acceded to the Hague Rules and did not reserve to itself the right of translating the package or unit limitation expressed in pound sterling into its own monetary system. Therefore, the limitation of liability in accordance with the laws in force in Türkiye was '100 sterling, gold value, per package or unit'.

The issue, among others, before the Court was: what is the applicable package or unit limitation in accordance with the laws in force in Türkiye?

Held: Judgment for the defendant.

It was important to know how and in what manner the Hague Rules were in force in Türkiye because the bill of lading incorporated the terms of the Hague Rules 'as enacted in' Türkiye and the Hague Rules themselves made provision for possible different methods of enactment into law in signatory States.

Somewhat unusually, Türkiye appeared to have enacted the Hague Rules twice into its legislation. Initially, on 14 February 1955, the Turkish Parliament ratified and enacted the Hague Rules. Both experts were in agreement that such ratification and enactment was fully effective and that the Hague Rules in their original form became part of the domestic law of Türkiye on that date. The following year, however, the Turkish Parliament adopted the Code. The Code was described by the experts as a 'translation' of the German Commercial Code of 1937 and, like the latter, contained an adaptation of the substance of the Hague Rules. The Code was passed for Türkiye to comply fully with its obligations to enact the terms of the Hague Rules into its national legislation. However, the 1955 enactment of the Hague Rules was never repealed. As a result, Turkish national law now apparently contained both a textual adoption of the Hague Rules, and a national adaptation thereof, as permitted by the Protocol of Signature. Article 1114 of the Code provided that where the nature and value of the goods had not been declared and inserted into the bill of lading, the maximum liability of the carrier was TRY 1,500 per package or unit. The Code was later amended in 1983 and the amount of such limitation was increased to TRY 100,000.

Nevertheless, the Court was persuaded by the evidence provided by the defendant. Although the original 1955 enactment had never been repealed, it had effectively been displaced by the 1983 amendment, at least with regard to the monetary amount of the limitation of liability, which today was TRY 100,000 or approximately CAD 2.30 per package or unit. In addition, as a matter of interpretation of the Hague Rules as well as the Protocol of Signature, the rights reserved by the contracting Parties to translate the sum of GBP 100 into their own currency and to adopt or adapt the terms of the Rules as best suited them was not a 'once and for all' matter.

Moreover, the defendant stated that the package or unit limitation in Türkiye in this case would be the metric ton. Since this statement had not been contradicted and was more favourable to the plaintiff, the Court accepted it for the purposes of the present decision.

Thus, the applicable unit of limitation was the metric ton and the applicable limitation of liability was TRY 100,000 per unit as provided in art 1114 of the Code.