UK Supreme Court Judgment on Jurisdiction of CMR Claims against Successive Road Carriers

18th November 2015

UK Supreme Court Judgment on Jurisdiction of CMR Claims against Successive Road Carriers

Trucks

Consignors will need a jurisdiction clause in their consignment note, as well as the contract of carriage, if they want to sue a foreign successive road carrier in the English courts.

That’s one of the key messages for Consignors arising from the recent UK Supreme Court decision in the case of British American Tobacco Denmark A/S and others v Kazemier Transport BV [2015] UKSC 65. The Court has clarified the law relating to claims made by Consignors against foreign successive road carriers where carriage has been carried out under the provisions of the Convention on the Contract for the International Carriage of Goods by Road 1956 (“CMR”) .

CMR

Under Article 34 of the CMR, where carriage of goods is governed by a single contract and is carried out by successive road carriers, which have been sub-contracted by the original carrier, all of the carriers in the chain are deemed to be responsible for the performance of the whole operation. Consequently all carriers in the chain become parties to the contract of carriage, subject to the terms of the consignment note. This position arises for the successive carrier upon acceptance of the goods and the consignment note.

If something goes wrong such as cargo being lost, stolen, damaged or delayed, Article 31 of the CMR provides that the Consignor can pursue a court claim against the defendant carrier in a CMR contracting country which has been specified within the contract of carriage as being the place where disputes have to be resolved. This is often called a “jurisdiction clause”.

If there isn’t a jurisdiction clause, Article 31 enables the Consignor to sue
(a) in the court of the country where the defendant carrier is ordinarily resident; or
(b) in the court of the country where the defendant carrier has its principal place of business; or
(c) in the court of the country of the defendant’s “branch or agency” through which the contract of carriage was made; or
(d) in the court of the country where the goods were taken over by the carrier (considered to be where the contract of carriage commenced); or
(e) in the court of the country where delivery is to be completed.

CMR Claims Against Multiple Carriers

So what happens where a number of carriers are believed to be at fault and where some or all of them are resident in different countries? Article 36 of the CMR provides that a Consignor can pursue a claim against multiple carriers at the same time and in the same court. A separate set of rules (known as the “Brussels Regulation”) also provides that, where there are multiple defendants facing proceedings based upon the same set of facts, the case can and should be dealt with by a single court, even where that court is a foreign one for some of the defendants.

So far so good you would think if you’re an English Consignor with a contract for carriage containing an English jurisdiction clause and bringing English Court proceedings against an English carrier and its subcontracted Dutch successive carriers (as in the British American Tobacco case).

Well, perhaps rather surprisingly, not so for the claim against the Dutch subbies, which the Supreme Court has effectively struck out. The key points for Consignors to bear very much in mind from this Supreme Court judgement are:

1. If you want to ensure that English jurisdiction applies to claims against the carrier and all the foreign subbies, make sure that both the contract with the carrier and the consignment note refer to the fact that any disputes / claims are to be dealt with by the Courts of England and Wales. If the consignment note is silent on this then the subbie will not be bound by the jurisdiction clause contained within the original contract.

2. The subbie is not a “branch or agency” of the carrier.

How can Gotelee Solicitors help?

Best to get the documents right before the goods leave the yard.  If you need advice and assistance on the wording of jurisdiction clauses, both in contracts of carriage and consignment notes then please contact either Petra Sharp on 01473 298187 / petra.sharp@gotelee.co.uk or Howard Catherall on 01473 289 190 / howard.catherall@gotelee.co.uk.

 

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