The Problem With Liability for NonConforming Goods

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The most important and most widely used treaties are the Hague-Visby Rules and the Hamburg Rules.The purpose of this dissertation is to examine these treaties and to determine whether or not they have effectively contemplated every conceivable circumstance in which liability can arise. Liability will, therefore, be examined in respect of non-conforming goods. The issue of liability and risk associated with non-conforming goods arises in CIF contracts, seaworthiness and the contract between the buyer and the seller. This dissertation will examine the dynamics of these elements of liability and obligations under the Hague-Visby Rules and the Hamburg Rules. The underlying goal is to determine whether these laws are sufficient for the regulation of liability and obligations under an international contract for the sale of goods and what changes can be made for improvement.Statement of the Problem: When a contract for the sale of goods involves parties resident in different countries the goods usually escape the application of domestic law while in transit. While in transit the goods can be exposed to the risk of damages. Since contract law generally requires that the risk of damages to the goods pass to the buyer once the seller delivers the same to the courier for dispatch, it appears to be entirely unfair for the buyer to accept the risk of damages when the goods are out of his control. At the same time it is entirely unfair for the courier to accept the risk of damages in circumstances where he has exercised due care in the storage and shipment of the goods. International law tries to strike a fair balance by defining the respective parties’ obligations with respect to the goods and by doing so sets forth a means by which liability can be ascertained. The law does not always accomplish this goal since in most cases the buyer relies on documents.