Himalaya Clauses in Sea Carriage Contracts: Closing the Pandora’s Box
Part of this project has been published in the Canadian Bar Review, Vol 102, No 1 (2024). Citation: Mary Ppasiou, "Privity of Contract and Third-Party Beneficiaries in Canadian Shipping" (2024) 102:1 Can Bar Rev 272 https://cbr.cba.org/index.php/cbr/issue/view/585
Abstract
The enforcement of Himalaya clauses in contracts for the carriage of goods by sea has gone further than it should have in the common law. By operation of a broadly drafted Himalaya clause, virtually any third party who participates in the performance of carriage can enforce any protection or benefit available to the carrier under the contract as a defense to claims brought by cargo owners for loss or damage to cargo. Following the establishment of a principled exception to the doctrine of privity of contract by the Supreme Court of Canada, Himalaya clauses have been applied expansively in the context of carriage of goods by sea. This Thesis argues that the expansive application of Himalaya clauses in the common law is highly problematic. Such a broad protection of third parties against liability is inconsistent with legal doctrine and it gives rise to a number of legal issues. Thus, this Thesis seeks to find an alternative and restrictive basis for the enforcement of Himalaya clauses in Canadian law.