Frozen Shrimp Reefer Temperature Excursion
An Indian importer holds an ICC(A) marine cargo policy on 18,000 kg of frozen shrimp shipped FCL from Kochi to Rotterdam in a 20-foot reefer. The bill of lading records a set point of -18°C, and the carrier's data logger shows -18°C until a 14-hour power failure at the transhipment terminal in Colombo, after which supply-air temperature rose to -6°C for 36 hours before re-cooling. The consignee rejected the cargo on arrival; a destination survey found partial thawing, drip loss and a core temperature of -9°C in cartons near the door. The insured claims USD 126,000, the full CIF value, less a USD 5,000 deductible. The policy incorporates the Institute Cargo Clauses (A) and a temperature-variation exclusion wording. The carrier says the reefer was functioning and blames terminal power. The insured's pre-shipment survey showed the cargo at -20°C and cartons in good order. A weather report shows no ambient extreme.
1. Identify the proximate cause and assess whether the loss is recoverable under ICC(A), addressing the temperature-variation exclusion and any inherent-vice argument. Show your reasoning step by step.
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Step 1: identify the event. The cargo was sound at -20°C before shipment. The only abnormal event is the 14-hour terminal power failure and the consequent 36-hour rise to -6°C. That is a fortuitous external event, not the ordinary gradual warming of frozen cargo.
Step 2: apply ICC(A). ICC(A) is an all-risks cover subject to exclusions. A sudden refrigeration failure is the kind of accidental event ICC(A) is designed to respond to, provided the cargo was not already defective and the loss was not inevitable.
Step 3: temperature exclusion. If the added wording excludes 'temperature variation', read it as aimed at ordinary transit fluctuations. A 36-hour rise caused by power loss is not ordinary variation. The insurer may still argue the exclusion is unqualified; then the exact wording and any held-covered extension matter. The surveyor should report the factual trigger, not decide the legal scope alone.
Step 4: inherent vice. The pre-shipment survey, core temperature records and carton condition rebut inherent vice. Frozen shrimp will spoil if abused, but that does not make the abuse an inherent vice. The loss is proximately caused by the temperature excursion.
Conclusion: likely recoverable under ICC(A), subject to the exact temperature wording, policy deductible and proof that the reefer was not already faulty at loading. If the policy were ICC(C), the result would likely differ because ICC(C) does not cover this type of accidental deterioration unless it flows from a named peril.
2. What survey evidence and documents should you obtain, and how would you test the carrier's and terminal's responsibility? Explain how you would record findings.
Read the worked answer
Obtain the original bill of lading, certificate, invoice, packing list, pre-shipment survey and temperature download; the reefer's service and calibration records; the terminal power log and incident report; the carrier's stowage and reefer-monitoring records; and the destination survey with core temperatures, photographs, samples and weight. Also obtain the rejection letter and mitigation costs.
Test carrier and terminal responsibility by establishing who supplied the reefer, who was responsible for monitoring it, and whether the power failure was foreseeable or caused by poor maintenance. Compare the data logger with the reefer's own alarm log. Check whether the set point changed or doors were opened. Interview the terminal electrician and obtain the outage duration. Record chain of custody for samples and the download. Keep factual findings separate from liability opinion. If Hague-Visby obligations apply, note that the carrier may rely on exceptions but must show due diligence; the terminal's liability depends on contract and bailee negligence. Document loss quantum by carton count and temperature profile, not just invoice value.