A comment on ITO Ltd. v. Miida Electronics Inc. - The Supreme Court of Canada, privity of contract and the Himalaya clause

• Author(s) / Creator(s)

  • Reif, Linda C.

• Introduction: In the transportation of goods by sea, the shipper contracts with a marine carrier usually agreeing to a term limiting the liability of the carrier for damage to or loss of the goods. The contract of carriage between the shipper and the marine carrier is evidenced by a bill of lading which contains its terms. Pursuant to legislation, the consignee named in the bill of lading also will be bound by its terms and will be subject to any exclusion clauses therein. Due to the nature of the shipment, the carrier often contracts with other persons, such as the stevedore, to obtain assistance in performance of the contract of carriage. If the stevedore has negligently damaged the goods, the owner has sued the stevedore in tort. Contrary to the doctrine of privity of contract, the stevedore has claimed the benefit of the exemption clause in the bill of lading. Initially the tactic failed, leading to the development of the Himalaya clause. A Himalaya clause is a limitation or exclusion of liability clause contained in a bill of lading that is drafted to extend its coverage beyond the carrier to include, in addition, servants, agents, independent contractors and other third parties employed by the carrier in the performance of the contract of carriage.

• Date created

  1988

• Subjects / Keywords

  • Bills of Lading
  • Maritime Law
  • Contracts

• Type of Item

  Article (Published)

• DOI

  https://doi.org/10.7939/R33F4M280

• License

  © 1988 Linda C. Reif et al. This version of this article is open access and can be downloaded and shared. The original author(s) and source must be cited.