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15 January 2014
On December 13 2012 the Federal Court of Justice ruled on the question of whether a freight forwarder was liable for loss of goods without limitation due to qualified fault. The court held that the freight forwarder had not necessarily acted with qualified fault by leaving a transport vehicle loaded with tobacco products over the weekend in an unguarded industrial estate in a large city.
The claimant, the underwriting agent of a transport insurance firm, brought a claim against the defendant freight forwarding company for damages caused by the theft of goods after having indemnified its policyholder for the loss.
In April 2008 the claimant's policyholder instructed the defendant to deliver tobacco products in Germany. The defendant instructed a sub-freight forwarder to perform the transport. The sub-freight forwarder carried out the transport with a vehicle and a box trailer, transporting various goods, which included the tobacco products. The sub-freight forwarder made a stopover and parked the vehicle and box trailer in an unguarded industrial estate in the city of Chemnitz over the weekend. Upon arrival at the handling warehouse, it was discovered that the box trailer had been opened during the stopover and some of the tobacco products had been stolen. The value of the stolen goods was €25,344.22.
The Osnabrueck District Court granted the claim in full due to defendant's unlimited liability. The defendant's appeal was unsuccessful, as the court of appeal confirmed the defendant's unlimited liability. The defendant appealed to the Federal Court of Justice.
The Federal Court of Justice found that the court of appeal had correctly ruled that the requirements for a claim for damages had been fulfilled. However, its judgment was incorrect with regard to the extent of compensation, as the court of appeal had ruled that the defendant was liable without limitation.
A freight forwarder must compensate damages up to an amount that is determined by the value of the goods at the place and time of acceptance of the goods for carriage. In principle, damages to be compensated by a freight forwarder are limited. According to Section 431(1) of the Commercial Code, the compensation payable for loss or damage to the entire consignment is limited to an amount of 8.33 units for each kilogram of gross weight of the consignment. If only individual packages of the consignment have been lost or damaged, the carrier's liability is limited to the amount of 8.33 units for each kilogram of gross weight of the whole consignment, if the whole consignment has lost its value. In this case, as only a part of the consignment was lost, the freight forwarder was liable to the extent of only €8.33 units of account for each kilogram of gross weight of the part of the consignment lost.
The limitation of liability is not applicable in the event of a freight forwarder's qualified fault. According to Section 435 of the code, contractual and legal provisions including a limitation of liability shall not apply in the event that the damage is caused by a freight forwarder (or a third party instructed by the freight forwarder) acting recklessly and with knowledge that such damage would probably result. In general, the claimant must prove that the requirements for a limitation of liability are not fulfilled. If there is certain probability of a qualified fault or reasons to assume such a fault, the burden of proof may shift to the opponent. The latter did not apply in this case.
The Federal Court of Justice ruled that the claimant, which had to prove the defendant's qualified fault, had not stated relevant circumstances to assume that the defendant acted with qualified fault (ie, recklessness and knowledge of risk).
The Federal Court of Justice objected to the findings of the court of appeal. The court of appeal ruled that the defendant had acted both recklessly and with the knowledge that damage would probably occur by leaving the vehicle over the weekend in an unguarded industrial estate. The defendant was aware that the tobacco products were part of the transported goods and that these products are usually at extreme risk of theft because they are easily utilised by third parties. Moreover, it would have been possible to leave the cargo at a different place.
According to the Federal Court of Justice, the assumption of qualified fault requires a "very serious infringement": the freight forwarder must ignore the security interest of the contractual party. The knowledge that damage would probably result requires an obtrusive realisation that damage will occur. The court ruled that neither the fact that the driver had parked the vehicle over the weekend in an unguarded industrial estate in a large city nor the defendant's knowledge of the tobacco products as part of the transported goods was sufficient for the assumption of qualified fault. There were no specific reasons that the defendant should have known that a theft may occur:
On this basis, the court remanded the case to the court of appeal for reappraisal.
This is another decision on a freight forwarder's qualified fault. It shows once again that the question of whether a freight forwarder has acted with qualified default can be resolved only by considering all relevant circumstances of the individual case. Moreover, the liability depends on the burden of proof on the part of the claimant (at least in the first instance).
The court's reasoning is correct, as the consequence of qualified fault is the full liability of the freight forwarder without limitation. In this case, the claimant's arguments were insufficient to warrant such unlimited liability. As the Federal Court of Justice correctly ruled, recklessness implies a more severe fault than gross negligence. Such unlimited liability is justified only if there are circumstances which lead to the conclusion that the risk of the loss of the cargo was obvious and the freight forwarder ignored this risk.
However, in the past, loss of cargo cases used to be straightforward unlimited liability cases. It is yet to be seen whether this decision is an exception to the rule or the starting point of a stricter interpretation of Section 435 of the Commercial Code.
For further information on this topic please contact Annika Trost or Marco G Remiorz at Dabelstein & Passehl by telephone (+49 40 31 77 970), fax (+49 40 31 77 97 77) or email (firstname.lastname@example.org or email@example.com). The Dabelstein & Passehl website can be accessed at www.da-pa.com.
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