The plaintiff, the United States of America, sued the defendant, an ocean carrier, for losses related to food aid cargo shipped on several different vessels operated by the carrier.

The plaintiff argued that the defendant was liable for these losses by failing to safely carry the cargo under COGSA / Hague Rules art 3.2. The defendant moved for summary judgment on grounds that its liability was precluded as a matter of law under COGSA / Hague Rules art 4.2.q, which absolves the carrier in situations in which the loss arises 'without the actual fault and privity of the carrier and without the fault or neglect of the agents or servants of the carrier’.

The issue before the court was whether the carrier was shielded from liability under COGSA / Hague Rules art 4.2.q.

Held: The initial burden is on the shipper to establish a prima facie case that the carrier received the cargo in undamaged condition (such as by showing the carrier issued a clean bill of lading when it received the cargo). But after the shipper has presented a prima facie case, the burden of proof shifts to the carrier to show that the loss was caused by one of the COGSA / Hague Rules exceptions.

For the carrier to properly invoke COGSA/ Hague Rules art 4.2.q as a defense, there must be a ‘lack of practical control’ that would render the carrier powerless to prevent the loss. Under the ‘custom of the port doctrine’ it may be necessary to turn to the ‘usage and law of the port’ to determine when the carrier loses ‘practical control’ of the cargo at the port of discharge. The carrier may invoke the COGSA / Hague Rules art 4.2.q defense only if there is such a lack of practical control.

A genuine issue of material fact remained as to the level of practical control the carrier maintained during the losses. The court denied summary judgment on the basis that further proceedings were necessary to make these determinations.