Under what circumstances can a carrier be relieved of liability for cargo loss due to inherent vice or perils of the sea?

• A. If loss results from inherent vice of the goods themselves or from perils of the sea as a natural hazard beyond carrier control, liability may be limited or excluded subject to contract terms.
• B. Carriers are always liable in such cases.
• C. The contract must be renegotiated.
• D. If loss results from the shipper's negligence, carrier is absolved.

Answer: (A)

The idea being tested is that certain risks can excuse a carrier from liability because they stem from the nature of the cargo or from natural maritime hazards. Inherent vice means the cargo’s own condition makes it prone to deterioration or loss regardless of how carefully it is handled. Perils of the sea cover natural hazards encountered during a voyage, like storms or heavy weather, that are outside the carrier’s control. When a loss arises from either of these sources, liability can be limited or excluded, but only to the extent allowed by the contract between the parties (the bill of lading, charter party, etc.) and applicable law. The contract can specify liability limitations or exclusions for these risks, though this does not apply if the loss results from the carrier’s negligence or improper conduct.