Gutser SAU (the plaintiff) filed a claim against Nationale Nederlanden Schadeverzekering NV (formerly Delta Lloyd Schadeverzekering NV) and others (the defendant insurers), claiming EUR 215,710.06, corresponding to damage to part of a cargo of steel coils loaded in Mormugao (India) on the ship Colchester Castle on 5 November 2014 and delivered to Barcelona (Spain) on 19 December 2014, which were transported in compliance with a contract of international carriage by sea insured by the defendants.

The steel coils were carried under a clean on-board bill of lading. At the time of discharge, the stevedores detected damage consisting of 'signs of previous wetting', which were reported to the plaintiff and evaluated once the cargo was transferred to the plaintiff's facilities. The adjuster's report recognised the existence of damage due to condensation, which it attributed to wetting prior to loading. The defendant insurers therefore rejected coverage because they considered that the damage was caused prior to transportation. On the contrary, the plaintiff maintained that the damage was caused by condensation in the cargo as a result of poor ventilation of the holds during transportation.

The Court of first instance, after evaluating the evidence, dismissed the plaintiff's claim, finding that the damage to the goods occurred while they were stored in Mormugao, before loading onto the ship, and thus not within the insurance policy's coverage.

The plaintiff appealed, arguing that the Court of first instance erred in its assessment of the evidentiary scope of the bill of lading issued for transport of the cargo, which was issued without reservations.

Held: Appeal upheld. The defendants are ordered to pay EUR 215,710.06 plus interest.

Both parties accept that the applicable carrier liability regime is that established by the Brussels Convention 1924 with the modifications introduced by the Protocols of 1968 and 1979 (The Hague-Visby Rules), and regulations incorporated into Spanish legislation in Law 14/2014 of 24 July on Maritime Navigation (the LNM).

Article 277.2 of the LNM provides in terms of liability that 'the carrier is responsible for all damage or loss of the goods, as well as delay in their delivery, caused while they were in its custody, in accordance with the provisions set forth in this section, which shall be applied mandatorily to all maritime transport contracts'. Article 277.2 refers to the Hague-Visby Rules and the provisions of the LNM.

In this case, the plaintiff alleges that the damage was caused by condensation on the cargo due to poor ventilation in the ship's holds during transportation. The defendant, for its part, maintains that the cargo was loaded wet because it had been stored outdoors and it had rained during storage and loading. We must take into account that there is a clean bill of lading, without any reservations or objections. Regarding the evidentiary force of the bill of lading, we must comply with the provisions of art 256 of the LNM which provides:

1. Unless proven otherwise, the bill of lading will attest to the delivery of the goods by the shipper to the carrier for their transportation and for their delivery to their destination with the characteristics and in the condition that appear in the document itself.

2. Evidence to the contrary will not be admissible against a person other than the shipper, including the consignee, who has acquired the bill of lading in good faith and without serious fault, unless the carrier has stated in the bill of lading corresponding reservations on the inaccuracy of the statements contained in the document regarding the goods received for transport or their condition.

This is to the same legal effect as art 3.4 of the Hague-Visby Rules.

In accordance with art 256.1 of the LNM and in the event of a clean bill of lading, there is a legal presumption iuris tantum in favour of the shipper regarding the correct and apparent good condition of the cargo, as we explained in our judgment of 17 March 2016 (ECLI:ES:APB:2016:3526), so it would be up to the carrier to prove causes of exoneration or its due diligence to avoid damage to the cargo.

Proof to the contrary is admitted between the shipper and the carrier, so that it will be the carrier who must prove that it did not receive the goods as stated in the bill of lading. But art 256.2 of the LNM provides for a case where in the face of a clean bill of lading there is no evidence to the contrary and that is when a third party has acquired it in good faith and without serious fault. In the case in question, this presumption iure et de iure benefits a consignee in good faith other than the shipper, against whom it is not possible to present evidence to the contrary regarding what is stated in the bill of lading.

This regime aims to generate legal certainty for third parties in good faith who are protected by the legal appearance of a document of title that certifies the good condition of the goods, so only the appropriate reservations or declarations outlined by the carrier in the document itself, calling into question some of the data and information about the cargo reflected in it, are relevant. If there are no reservations, there is no proof to the contrary, and the carrier must respond without prejudice to the latter, being able to subsequently claim against the shipper for the damages caused by any inaccuracy of the declarations relating to the goods delivered, as specified: see art 260 of the LNM.

After an exhaustive analysis of the evidence, we reached a different conclusion to that reached by the trial Judge, since from the logical evaluation of the same it clearly appears that the damage to the coils was caused during transportation and was due to condensation suffered by the cargo due to a lack of adequate ventilation in the holds. From the tests carried out, there are no doubts about the good condition of the cargo on loading, as can be seen from the Canopus loading report, the shipping receipt, and the bill of lading itself signed by the master without reservations. Not only must we assume that the coils were loaded in perfect condition, as declared by the shipper, but that they were perfectly packaged as stated in the insurance adjuster report. This report indicates:

Coils packed in galvanized sheet metal provided with interior and exterior metal edge protectors and tied with 5/6 flat metal straps in the shape of a cross and 3 in the shape of a circle.

The interior of the coils was also protected by several layers of reinforced plastic sheeting and other fibre edge protectors.

This packaging is considered suitable for transport, but always subject to proper handling and stowage.

Likewise, the good condition of the cargo was noted in a report prepared at the time of loading by the shipowner, which states that the cargo was in good condition: 'I) No wet coil before shipment.' It is true that this report states 'F) 119 Coils with white oxidation marks on the outer packaging', but the existence of rust on the outer packaging does not presuppose either that the coils had been wetted or that there was water inside them before loading, as the defendant insurers maintain. The outer packaging of the coils is metallic and of inferior quality since it is only used for transportation. That this material could be affected by atmospheric oxidation is not relevant for the purposes of assuming that the interior of the coils is affected by rust when they have several layers of packaging for transport: a first packaging with transparent film, a second cardboard packaging, and a third metal packaging, and these were in perfect condition. The shipping receipt (mate's receipt), a document issued by the consignee of the ship or freight forwarder and signed by the first officer, acknowledging receipt of the cargo on board the ship, does not present any reservation in this regard, indicating that the goods were in good condition.

The defendant insurers base part of their argument on the fact that the coils were stored outdoors at the loading port for a long time, subject to inclement weather, constant rains, and even floods, and that they were loaded while it was raining. None of this squares with the tests carried out. At the loading port, the goods were in an enclosed place. The coils were properly stored in a shed (warehouse) and it was not raining when they were loaded, nor was there any flooding.

On the contrary, it is proven that the oxidation of the cargo occurred on the ship due to a sudden drop in temperature between the loading port of Mormugao (India) and the discharge port of Barcelona (Spain), which, together with a lack of ventilation and adequate storage of the coils caused the temperature to drop below the dew point, generated significant condensation.

The plaintiff's expert opinion also reveals that the ship had faulty remote control systems for ventilation and openings, and this fault, along with others, was recorded at the Venice stopover where the ship remained for six days due to technical deficiencies.

Given this evidence, we must conclude that the damage to the goods occurred during maritime transport.