The Regal-Beloit Decision: What, If Anything, Would Happen to the Legal Regime for Multimodal Transport in the United States If It Adopted the Rotterdam Rules

Robert Force | Ost Colloquium: Multimodal Transport

Multimodal transport pursuant to a through bill of lading can present a complicated set of relationships when goods are lost or damaged. Using some terminology of the Rotterdam Rules, these issues, among others, are currently resolved as follows:

  • Shipper’s rights against the ocean “carrier” are determined under the Carriage of Goods by Sea Act (COGSA) or as provided in a service contract or a voyage charterparty between shipper or consignee and carrier.
  • Shipper’s rights against a maritime performing party such as a stevedore, terminal operator, etc., are determined under the law of torts if there is no contract. However, bills of lading usually contain a Himalaya clause which extends to maritime performing parties the same defenses and limits of liability that may be invoked by the carrier under COGSA and its bill of lading.
  • Shipper’s rights against an overland carrier who initially receives cargo for multimodal transport that includes a subsequent sea leg will be discussed infra.
  • Shipper’s rights against a nonmaritime performing party such as an overland carrier who is not the initial carrier but who transports the goods within the United States after their arrival at a U.S. port from a foreign port will also be discussed infra.
  • Carrier’s rights to indemnity or contribution against a performing party, whether maritime or nonmaritime, are not provided by statute and are derived from the general maritime law or state law on contracts and torts, which is beyond the scope of this Article.

This Article initially will explore the issue of shipper’s rights against a nonmaritime performing party such as an overland transporter. It will then discuss whether or not the Rotterdam Rules, if adopted by the United States, would cause any fundamental change to the current situation.