We’re talking bailments, folks. When I ask you to hold my beer, I am entrusting you with the safekeeping of my beer. Or, in the case of a cargo ship full of luxury autos, the safe transport of my cars from Europe to North America.
Just like the baton in a relay race, the chain of bailments can be long and complicated. It only becomes a problem when someone drops the baton. Or, in this case, when the cargo ship catches fire and eventually sinks 250 miles off the coast of Portugal.
PHOTO: PORTUGUESE NAVY/VIA REUTERS
Knowing who was in “possession” and knowing what risks each possessor did and did not assume are critical.
Here? If the fire was caused by one of the car’s batteries exploding, the battery manufacturer may be liable not only for the value of the car that the battery was in, but the value of every car on that cargo ship plus the ship itself.
Understanding the interplay between the supply contract (supplying batteries for cars) and the shipping contract (who is responsible when bad things happen during transit) are the kinds of details that can sometimes be brushed off as legalese that really doesn’t matter. Which, 99.9% of the time, perhaps it doesn’t matter… because nothing ended up going wrong. The problem is, that 0.1% time when something bad does happen, if you’re the battery supplier, the last thing you want to find out is that you’re being handed a bill for a cargo ship full of other people’s cars that is now at the bottom of the ocean.