(1) The carrier is liable for any damage resulting from the loss of or physical damage to the goods occurring between the time the goods are taken over and their delivery.
(2) The carrier will be released from liability pursuant to subsection (1) insofar as the loss of or physical damage to the goods was due to circumstances which could not have been avoided by a prudent carrier exercising due care. If the goods were carried by a ship that was not in seaworthy or cargoworthy condition, and if the facts of the case indicate a likelihood that the goods were lost or physically damaged due to the ship’s lack of seaworthiness or cargoworthiness, then the carrier will be released from liability pursuant to subsection (1) only if the carrier can prove that the lack of seaworthiness or cargoworthiness could not have been discovered prior to commencement of the journey by a prudent carrier exercising due care.
(3) If the damaged party contributed to the occurrence of the damage, due to their fault or neglect, then the obligation to pay compensation and the amount of the compensation payable will depend on the circumstances, and specifically on the extent to which the damages were caused primarily by one or the other party.