Shipping & Transport - Germany

On November 3 2005 the Federal Supreme Court ruled on whether cargo handling at a seaport terminal constitutes a separate leg of a voyage within the meaning of Section 452(a) of the Commercial Code and is therefore subject to a different legal regime than carriage by sea. The court ruled that the discharge of the vessel and storage of the goods in the port area form part of the sea carriage leg of the voyage with respect to liability, unless special circumstances deem otherwise. This means that the sea carriage leg does not end, as one would perhaps expect, when the cargo is discharged.

In a separate case the Federal Supreme Court dismissed the dissenting view of the Hamburg Higher District Court that the transfer of goods from a sea-going vessel onto a road vehicle is a leg of the voyage in its own right within the framework of a multi-modal transport journey, provided that the transaction can be attributed a certain significance and regarded as carriage in its own right.(1) Based on the district court's ruling, all contracts of carriage by sea which not only are waterborne but also include cargo handling at the terminal would be regarded as multi-modal transport. Consequently, maritime law would apply pursuant to Section 452(a) of the Commercial Code only if it could be proven that any damage occurred during the sea leg. In practice, this would pose difficulties; often, the contents of a container are checked only when it is earmarked for leaving the terminal, in which case it is difficult to ascertain whether the goods were damaged onboard the vessel or at the terminal.

In a November 3 2005 ruling the Federal Supreme Court confirmed that, traditionally, the handling of goods in port was regarded as an annex to the carriage of the goods by sea. The court reasoned that, under a contract of carriage by sea, the carrier owes the delivery of the goods pursuant to Section 606 of the Commercial Code. To this effect, the carrier must relinquish possession of the goods in agreement with the authorized receiver and put it in a position to take custody of the goods - something that is rarely achieved at the discharge stage.

Terminal handling contracts are traditionally concluded between shipowners and terminal managing entities. However, it could be argued that terminal handling does not form part of the sea leg of the voyage if instructions were given to the terminal by the shipper delivering the goods for shipment by road, rail or otherwise. It has not yet been decided by the courts whether establishing who gave the relevant instruction is a valid method to determine whether the terminal handling operations are subject to maritime law or a different legal regime. The courts have also yet to clarify what constitutes a 'special circumstance' which would make the terminal handling process a separate individual transaction, distinguished from carriage by sea.

For further information on this topic please contact Esther Mallach at Dabelstein & Passehl by telephone (+49 40 31 77 970) or by fax (+49 40 31 77 97 77) or by email (e.mallach@da-pa.com).

Endnotes

(1) OLG Hamburg, TransportR 2004, 402 and following.