Contamination of tank container of wine

Member, acting as agent for the carrier, arranged for the provision of a tank container to a wine exporter for the shipment of 21,000 litres of wine from Australia to the USA.  On arrival, the consignee refused to take delivery as the accompanying documents did not include the relevant certificate of food quality.  He also alleged that the wine was contaminated.  Arrangements were made for the tank container to be returned to Australia where tests could be carried out and, if necessary, the wine distilled to remove its alcohol content.

Enquiries revealed that the tank container had been used previously for a cargo of liquid detergent and a steam clean as well as the replacement of all gaskets and seals to remove all traces of the detergent would have been necessary to bring it up to food quality standard.  Unfortunately, this was not done and the wine had become contaminated.

As a clean B/L had been issued the carrier had no defence to a claim from the shipper but the carrier in turn looked to the agent for indemnity under the terms of their Agency Agreement. 

The tank container had been ordered by the agent from a yard which was not conversant with food quality standards as the yard in question was not normally used for the storage of tanks intended for the carriage of commodities requiring food quality standards.

The agent's written instructions to the yard specified the tank required by container number and also that it was intended for the carriage of a cargo of wine but this did not oblige the yard to undertake any course of action to ensure that contamination of the contents would not occur.  It was incumbent on the agent to ascertain the previous content of the tank from import container files but this was not done.

The liability of the shipper was investigated but as any reasonable inspection of the tank before filling would not have revealed the presence of residues of liquid detergent harboured within the seals and gaskets these investigations were not pursued.

In due course, a claim for A$89, 299 was made upon the carrier and the Club decided to obtain their agreement to the agent negotiating a settlement direct with the shipper to agree the best possible terms and to avoid unnecessary costs.  This was done and settlement was agreed at A$ 61,000.  No costs were incurred.