A hard Brexit would increase liability risk for EU carriers and freight forwarders, and disputing parties would need to overcome a number of factual and legal hurdles. Before undertaking cross-border transports, carriers are well advised to make clear agreements with senders in order to clarify that customs clearance delays are expected for an unforeseeable duration and request instructions from senders in accordance with the Convention on the Contract for the International Carriage of Goods by Road.
When a sea carrier files for insolvency in the course of a sea carriage, considerable additional costs and expenses occur in the effort to deliver the cargo to the consignee. German law applies if a German freight forwarder is instructed with a multimodal carriage including a sea leg. This results in the general legal obligation for the forwarder to conduct the transport itself or with subcontractors in order to deliver the cargo to its destination for the fixed freight agreed.
The leading unions of forwarders and cargo interests have both agreed to recommend the new Freight Forwarders' Standard Terms and Conditions (ADSp 2017). The ADSp 2017 are the result of long negotiations aiming to modernise the former version of the ADSp adopted in 2003. The ADSp 2017 will clarify many aspects of daily business; however, daily practice and the courts will ultimately decide on the relevance of some of the clauses, which might be held invalid under the law.
If a forwarder is unable to pay the freight to the carrier, the carrier may decide to invoke a right of retention regarding the goods in its custody based on a contractual or statutory lien. If the carrier has no lien, there is a high risk that it will be held liable for the cargo value and financial losses. The carrier should seek legal advice before exercising a lien.
The Federal Court of Justice recently clarified the liability of a forwarder for damage that occurred before the consignment was loaded onto a truck. The decision extends the liability of a forwarder to pre-transport storage under German transport law, even if the transport begins several days later. However, this applies only when the forwarder has already been instructed with the transport.
In February 2008 the roll-on, roll-off vessel Adriyatik caught fire as it sailed from Turkey to Italy, destroying about 200 trucks. Since then, several courts in Germany have considered the liability of Turkish carriers under the Convention on Contracts for the International Carriage of Goods by Road (CMR). This update considers recent developments in the various cases, particularly with regard to the question of whether the English or French version of the CMR should apply.
The roll-on/roll-off vessel MS UND Adriyatik caught fire on the way from Turkey to Italy off the coast of Croatia. The vessel was entirely destroyed by the fire, with a total loss of the consignments on board. The criteria by which to define an event that could have occurred only in the course of and by reason of sea carriage are yet to be clearly determined in Germany.
The issues surrounding the right of retention based on a contractual or statutory lien are highly significant, since such liens may constitute the only promising way for a carrier to seek the satisfaction of claims against an insolvent freight forwarder. However, the owner's interests must be taken into account, since goods owners usually have nothing to do with the problems between the freight forwarder and the carrier.
A recent case before the Hamburg Regional Court addressed the question of whether German shipping law could be applied to cargo handling in the course of a stopover during a sea carriage, where transshipping between the two parties involved had not been consented to.
The carrier is generally liable for damage to a consignment which occurs within its custody after takeover and before delivery. If the damage arises while the consignment is still on the load floor of the lorry during unloading by the driver, the carrier’s liability depends on whether the damage occurred before or after delivery.
In two recent cases the Federal Court has developed its jurisdiction on the reduction of carrier liability for the contributory negligence of the consignor. The rulings related to judgments granting unlimited liability based on gross negligence under Article 29 of the Convention on Contracts for the International Carriage of Goods by Road.