Shipping & Transport - Germany

Facts

In a case decided by the Federal Court of Justice in November 2005, a German freight forwarding company was instructed to organize the transport of a container from Tunisia to Germany at a fixed price. The container was carried from Tunisia to Genoa by sea and thereafter by truck to Germany.

When the container arrived at the destination it had suffered visible damage and its contents had been almost entirely destroyed. The plaintiff - the insurance company covering the transport - sought recourse against the freight forwarder. It argued that in such cases, where it is not possible to identify when the damage occurred - whether during the sea passage or the road carriage - a limitation of liability cannot apply. It contended that the defendant was liable for the entire claim without limitation. The insurer pointed out that the freight forwarder had the burden of proving that it did not act with gross negligence, but had provided no evidence in this respect.

Judgment

The Federal Court of Justice dismissed the claim, because the plaintiff provided no evidence that the freight forwarder acted negligently. The court outlined the necessary evidence to be provided by the parties in order to comply with the burden of proof by distinguishing between cases involving loss of and damage to cargo. In cases where it is impossible for the plaintiff to prove the necessary facts to exclude the limitation of liability, because the defendant was wholly responsible for organizing the transport and had superior knowledge of the facts and details thereof, the court established an obligation on the part of the defendant to bridge the deficit of information in cases involving loss of cargo only. The court ruled that in other cases the burden of proof does not shift to the freight forwarder because the above obligation applies in cases involving loss only, and not for negligent organization of the transport causing damage. Consequently, the plaintiff had to give a detailed description of the facts giving rise to its claim. It had to prove the damage and negligence on the part of the freight forwarder - which it could not do.

Comment

Two aspects of the decision are significant. First, the court confirmed that the secondary obligation to provide information and evidence rests with the freight forwarder in cases involving loss of cargo only. Thus, the burden of proof remains with the plaintiffs in cases involving damage to cargo.

Second, the Federal Court pointed out for the first time that the above obligation also applies to sea transport. The case law in this respect was established in the context of an air transport case in September 2000,(1) was subsequently extended to road haulage cases and now applies to all means of transport. This notwithstanding, Section 660(3) of the Commercial Code requires a 'personal default' on the part of the sea carrier to exclude the limitation.

For further information on this topic please contact Jan Tjarko Eichhorn at Dabelstein & Passehl by telephone (+49 40 31 77 970) or by fax (+49 40 31 77 97 77) or by email (j.eichhorn@da-pa.com).

Endnotes

(1) TranspR 2001, 29.