Himalaya clause
A bill of lading clause that extends to the carrier's servants, agents and subcontractors, such as the stevedore, the defenses and liability limits the carrier itself enjoys.
The bill of lading binds the shipper and the carrier, and the liability limits it provides benefit in principle only the carrier. A cargo claimant may therefore be tempted to get around the limit by suing, in tort, the master, crew or stevedoring company that caused the damage. The Himalaya clause closes that door by stipulating that these persons enjoy the same defenses, limits and time bars as the carrier. Its validity was accepted in English law through a contractual construct, with the carrier acting as agent for its subcontractors, and then enshrined by the Hague-Visby Rules for servants and agents. For insurers, it matters twice: it protects subcontractors insured for liability, and it narrows the recovery options of the cargo insurer subrogated to the cargo owner's rights.
The clause takes its name from the English case Adler v Dickson of 1954: a passenger injured aboard the liner Himalaya sued the master and boatswain, getting around the exemption stipulated in favor of the P&O line; the Privy Council upheld the contractual workaround in 1974 in The Eurymedon.
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