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08 August 2012
On June 29 2012 the Brussels Court of Appeal ruled on the meaning of 'loss' under the Warsaw Convention. Although the ruling was on the basis of Article 18 of the original 1929 convention, it is valid for subsequent versions, including the Montreal Convention 1999.
The case involved a shipment from Belgium to Italy undertaken by a Belgian contractual carrier under the special instruction to 'hold for pick-up', meaning that the goods could be delivered only on the sender's written confirmation, to be provided to the carrier's agent in Italy.
Once the shipment arrived in Italy, the carrier's agent complied with the special instructions of the air waybill and held the goods for pick-up. The goods were delivered to the receiver upon the sender's written confirmation to do so.
Subsequently, it appeared that the written confirmation received by the carrier's agent had been falsified, that the goods in question had been handed over to an unauthorised receiver and were lost. The Rome Court of Appeal ruled that the issuance of the falsified confirmation constituted fraud.
Pursuant to Article 18, a carrier is liable for damage sustained in the event of destruction or loss of registered baggage or cargo if the occurrence which caused the loss took place during the carriage by air.
In its decision of December 6 2007 the Brussels Commercial Court ruled that the Warsaw Convention governs the matter and ordered the carrier to pay up to the limits for which Article 22 provides. The carrier's agent in Italy was ordered to hold the carrier harmless. Surprisingly, the court did not refer to Article 18.
Without referring to Article 25, pursuant to which the limited liability does not apply if there is evidence of a special fault, the court found that neither the carrier nor its agent in Italy had intended to cause damage or committed a special fault by remitting the goods to an unauthorised receiver. However, the court ruled that carrier and agent had failed to prove that all measures had been taken to avoid the remittance of the goods to the unauthorised receiver. The court stated that the special instructions 'hold for pick-up' imply an obligation to pay special attention to the delivery of the goods.
The sender appealed the decision with a view to obtaining judgment to order the carrier to pay the full amount of the alleged damage.
The Court of Appeal ruled that as the sender was not the owner of the goods in dispute and had shown no evidence of having suffered any loss or damage, the claim should be declared to be without merit. Neither the carrier nor its agent was ordered to pay anything.
The court ruled that loss occurs for the purpose of Article 18 if the goods are lost or handed over to a person who is not authorised to receive them. The Court of Appeal referred to the ruling of the Court of Cassation of April 10 2008 (for further details please see "Court of Cassation rules on meaning of 'loss' under Warsaw Convention") and added that the event that gives rise to the liability must also lead to the loss of the goods. In this case, as the goods had not been delivered to the authorised receiver, and had not been found, the court ruled that there was 'loss' of the goods according to the definition in Article 18.
In a similar case, a French court recently found(1) that a carrier had committed a special fault by delivering goods to a receiver that was not authorised to receive them. As the carrier verified neither the existence of the receiver at the address cited on the air waybill, nor the identity of the receiver to whom the goods were eventually delivered, it had failed to comply with its obligation to deliver the goods. The court ruled that the carrier's fault had resulted in the loss of the goods and ordered it to pay the total amount of the alleged damage.
The Brussels Court of Appeal decision follows established opinion and precedent in Belgium, according to which loss may occur not only when goods are destroyed or lost, but also when they are handed over to an unauthorised receiver. However, as the damage could not be evidenced, the carrier and its Italian agent were not ordered to pay. The French court's decision was severe and identified the carrier's negligence in verifying the receiver's address and the receiver's identity as special faults within the meaning of Article 25.
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