Shipping & Transport - Germany

Facts
Decision
Comment

Facts

In a recent case a German marine insurer sued a carrier, Deutsche Post AG, for compensation for loss of cargo. The cargo, a package containing gold coins worth approximately €11,750, was lost during transportation. The applicable general terms and conditions of the carrier stipulated that packages with money, precious metals or other valuables worth more than Dm1,000 (approximately €510) would not be carried by the carrier as standard packages. Where packages failed to meet the specification stipulated in the general terms and conditions, the carrier would be free to:

• refuse to accept the package;
  
  
• return an initially accepted package to the forwarder; or
  
  
• charge a higher freight.

In June 1999 the forwarder and the carrier discussed this restrictive stipulation and the carrier subsequently agreed that the forwarder may send packages with gold coins worth up to Dm10,000 (approximately €5,110) as standard packages. In August 1999 the forwarder handed over to the carrier a standard package with gold coins worth approximately €11,750 in order to forward and deliver the package to one of its customers. Under unknown circumstances the package was lost during transportation. The carrier refused to compensate the forwarder for the loss.

Decision

The Federal Supreme Court held that, despite a careless causation of the damage by the carrier, its liability was excluded because of contributory negligence if the forwarder knew that the carrier did not want to carry particular goods but defied this declared intention without informing the carrier.

The court found that the parties effectively entered into a contract of carriage by implied conduct. According to the court, an interpretation of the general terms and conditions of the carrier shows that the carrier intends to enter into a contract of carriage unless it expressly refuses to accept or to forward a particular package. Further, the court argued that in principle the carrier faced unlimited liability for the loss as the damage was caused by an act or omission by the carrier or one of its vicarious agents respectively, wilfully or recklessly with the knowledge that damage would probably occur. In this respect the court was in line with previous decisions, assuming that the carrier had acted wilfully or recklessly because of poor management of the transportation as the carrier was neither able to clarify the circumstances of the loss of the cargo nor explain measures taken to avoid losses.

However, here the court found that the obligation of the carrier to pay damages for the loss was excluded because the conduct of the forwarder contributed to the loss in such a manner that it outweighed the liability of the carrier. The forwarder knew from the previous correspondence with the carrier that it was unwilling to carry gold coins worth more than Dm10,000 but nevertheless surrendered a package for transportation worth more than twice this amount. In addition, the forwarder failed to inform the carrier of the value of the cargo and thus that a higher quantum of damage could be incurred.

Comment

Through this decision the Federal Supreme Court both continued and advanced its previous case law. The court once more confirmed its case law that a carrier faces unlimited liability because of careless causation of damage if (i) the circumstances of a loss of cargo are totally unclear, and (ii) the carrier is unable or unwilling to explain its company organization (ie, the organization of transportation, and in particular the safety precautions taken to avoid losses of cargo).

More importantly, the court advanced its previous case law that the liability of a carrier, even for careless causation of loss of cargo, may be restricted or, as in this case, excluded because of contributory negligence of the forwarder. According to the court, contributory negligence is decided particularly where the forwarder does not inform the carrier about the (high) value of the cargo, such that the carrier is not aware that it should be taking particular precaution in order to avoid serious damage. In this case the forwarder was aware that the carrier was unwilling to transport packages with a value higher than Dm10,000 as standard packages but would have transported with particular care had it known the actual value. Thus, the court decided that the contributory negligence of the forwarder outweighed the liability of the carrier.

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