## Facts

- James Knott owned the British steamship *Portuguese Prince*, which carried mixed cargoes between South America and the United States.
- Botany Worsted Mills and Winter & Smillie shipped separate lots of wool from Buenos Aires to New York in December 1894.
- The wool was stowed between decks near the bow, forward of a temporary wooden bulkhead that was not watertight.
- At Pernambuco in February 1895, the vessel loaded about 200 tons of wet sugar, which predictably drained liquid, and stowed it aft of the bulkhead in the same between-decks space.
- While the vessel initially trimmed stern-down, drainage ran aft and exited through scuppers; after later cargo discharge, the vessel trimmed head-down, causing drainage to run forward through the non-tight bulkhead and damage the wool.
- Bills of lading broadly purported to exempt the carrier from liability for negligence and for damage arising from stowage or contact with other goods, and provided that the contract would be governed by the law of the ship’s flag (British law).
- The Harter Act was in force when the bills of lading were issued.

## Issues

1. Whether damage caused by sugar drainage reaching wool due to cargo arrangement was a “fault or error in navigation or management of the vessel” (potentially exonerated under § 3 of the Harter Act) or negligence in “loading [or] stowage” (non-exculpable under § 1).
2. Whether § 1 of the Harter Act applies to a foreign-flag vessel carrying cargo from a foreign port to a port of the United States.
3. Whether bill-of-lading clauses exempting negligence and selecting the law of the flag can displace the Harter Act on an inbound voyage to the United States.

## Decision

- The Supreme Court affirmed the judgment for the cargo owners.
- The Court held the loss resulted from negligent loading or stowage, not from navigation or vessel management within § 3.
- The Court held § 1 applies to “any vessel” carrying merchandise from a foreign port to a U.S. port, including foreign vessels.
- The Court held contractual exculpations for negligent loading or stowage and a law-of-the-flag clause are ineffective where the Harter Act applies.

## Legal Principles

- Under Harter Act § 1, a carrier may not contractually relieve itself from liability for loss or damage arising from negligence, fault, or failure in proper loading, stowage, custody, care, or delivery of cargo.
- Harter Act § 3’s protection for “faults or errors in navigation or in the management of the vessel” does not extend to negligent cargo-stowage arrangements that fail to protect cargo from foreseeable drainage or contact risks.
- The Harter Act applies to inbound foreign commerce: a foreign-flag vessel transporting cargo from a foreign port to a U.S. port is within the statute’s geographic scope.
- Choice-of-law and broad exculpatory bill-of-lading provisions cannot negate the Harter Act’s mandatory rules when the statute by its terms governs the carriage.

## Conclusion

Knott was liable because the cargo damage was caused by negligent stowage—placing wet sugar behind a non-tight bulkhead without adequate drainage protection—an area where the Harter Act forbids contractual immunity, and the Act applied despite the vessel’s foreign flag and the bill of lading’s foreign-law and negligence-exemption clauses.


Knott v. Botany Worsted Mills, 179 U.S. 69 (1900)