Carriage of Good by Road - © Nicole Kornet 2018. All rights reserved. This text has been produced

© Nicole Kornet 2018. All rights reserved. This text has been produced for educational purposes for the courseInternational Commercial Law. Reproducing and distributing this material without the written permission of the

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An Introduction to Contracts for the Carriage of Goods by Road: The CMR Convention

Dr. Nicole KornetFaculty of Law, Maastricht University

1. INTRODUCTION 1

2. THE SCOPE OF APPLICATION OF THE CMR 1

3. THE CONSIGNMENT NOTE 7

4. RIGHT OF DISPOSAL AND IDENTITY OF THE CARRIER 8

5. THE CARRIER’S RESPONSIBILITY 17

6. DEFENCES UNDER THE CMR 18

7. LIABILITY UNDER THE CMR 23

7 LIMITATION OF LIABILITY 23

7 BREAKING THROUGH THE LIMITATION OF LIABILITY 23

1. Introduction

The CMR Convention – Convention relative au Contrat de transport international de Marchandises parlaw Route (CMR) – governs contracts for the international carriage of goods by road. It was signed inGeneva in 1956 and entered into force on 2 July 1961. The CMR currently has 55 contracting partiesincluding Ireland and the United Kingdom in the West to Tajikistan, Iran, Russia and Mongolia in theEast, and Morocco and Tunisia to the South. 1 The Convention aims to provide a uniform set of rulesthat standardize the conditions governing contracts for the international carriage of goods by road, inparticular relating to the documents used for such carriage and the carrier’s liability. The CMR tries tocreate a balance between the rights and obligations of the carrier and the sender of the goods.

2. The Scope of Application of the CMR

The CMR applies to contracts for the international carriage of goods by road that fall within the scopeprovisions of Articles 1 and 2. For the CMR to be applicable, the carriage must meet the requirementsof Articles 1 and 2 CMR. Article 1 provides:

(1) This Convention shall apply to every contract for the carriage of goods by road in vehicles for reward, when the place of taking over of the goods and the place designated for delivery, as specified in the contract, are situated in two different countries, of which at least one is a contracting country, irrespective of the place of residence and the nationality of the parties.

1 For current status information see: treaties.un/doc/Publication/MTDSG/Volume%20I/Chapter%20XI/XI-B-11.en.pdf

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From this provision, it is possible to identify at least five requirements for a contract of carriage to fallwithin the scope of the CMR. Firstly, there must be a contract for the carriage of goods by road.Secondly, the carriage must take place in vehicles, which is further defined in paragraph 2 as “motorvehicles, articulated vehicles, trailers and semi-trailers as defined in article 4 of the Convention onRoad Traffic date 19 September 1949”. Thirdly, the carriage must be for reward. In other words, thecarrier must receive payment for the carriage; gratuitous carriage of goods does not fall under thescope of the convention. Fourthly, there must be an international dimension, which is establishedwhen the contract specifies that the place for taking over the goods and the place designated fordelivery are situated in two different countries. This requirement is fulfilled even if the carriage endsbefore the goods leave the country where they were taken over by the carrier. In Buchanan v BabcoForwarding, 2 the carriage related to a cargo of whisky to be transported from London to Paris. Thewhisky was stolen from the docks in Dover, and consequently, the goods never crossed a border.Nevertheless, the CMR was applicable in this case because the contract stated that the place for takingover the goods was London and the place designated for delivery was Paris. There was an internationaldimension to the carriage. Fifthly, there needs to be a connecting factor to a contracting state, whichis established by either the place of taking over the goods or the place designated for delivery being acontracting state. Paragraph 3 explains that the convention also applies if the carriage is carried outby States or governmental institutions or organizations. Paragraph 4 contains a number of exceptions.The CMR does not apply to carriage performed under the terms of any international postalconvention; funeral consignments or furniture removal.

In contrast to the Hague Visby Rules, which require the contract of carriage of goods by sea to begoverned by a bill of lading, it is not necessary under the CMR for the contract to be contained in aparticular type of document. 3 Article 4 provides that even in the absence of a consignment note, theCMR remains applicable:

The contract of carriage shall be confirmed by the making out of a consignment note. The absence,irregularity or loss of the consignment note shall not affect the existence or the validity of thecontract of carriage which shall remain subject to the provisions of this Convention.

The scope provision also does not require the parties’ express agreement for the CMR to beapplicable. 4

Article 2 of the CMR extends the scope of the convention to situations where the vehicle carrying thegoods is carried over part of the journey by sea, rail, inland waterways or air. In other words, the CMRapplies to “piggy back”, “kangaroo” or roll-on/roll-off (RoRo) situations, where the vehicle containingthe goods is transported on or in another mode of transport, such as a ship, airplane or railway-wagon.In such a situation, the CMR remains applicable to the whole contract of carriage provided the goodsremain on the vehicle (as defined in Article 1(2)). If the goods are unloaded from the vehicle andloaded onto the other mode of transport, the carriage of goods by road is ended and the CMR ceases

2 [1978] AC 141.3 Compare with Hague-Visby Rules which limit the scope of application to bills of lading.4 Although see e. Italian law: the Italian Supreme Court holds that the CMR is only applicable if the parties haveexpressly agreed in the contract that the carriage is covered by the convention. Berlingieri, p. 17.

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that the sea, rail, inland waterways or air carriage must already have commenced and must not yethave ended when the loss, damage or delay occurred. This then becomes an issue of determiningwhen for instance the carriage by the other means of transport commences and ends. The CMR hasbeen drafted in line with other conventions. Therefore, the question when carriage by the other modeof transport commences or ceases needs to be determined under the rules applicable to that othermode of transport. In the case of sea carriage governed by the Hague Visby Rules, Article 1(e)determines that the carriage of goods by sea covers the period from the time when the goods areloaded on to the time they are discharged from the ship. In Thermo Engineers, 6 the contract relatedto the carriage of a heat exchanger from Aylesbury to Copenhagen. During the loading of the trailercarrying the heat exchanger onto the roll-on-roll-off ship, the heat exchanger struck the deckhead ofthe vessel, causing damage. The court held that the sea carriage had already started since the trailerhad passed the outboard ramp and crossed the line of the stern of the ship. Consequently, the carriageby road had ceased and the sea leg had begun. This demarcation is not so simple for every case. In aFrench case (1991), 7 a trailer with clothes was being carried from Casablanca to Marseille. The trailerwas stolen on the quay in Marseille while under the supervision of the stevedore. Although theft of atrailer on land is not related to sea carriage, the court nevertheless held that this was governed by seacarriage because the trailer was still with the stevedore and therefore the sea carriage had not yetended. In essence, the road carriage ends or recommences when the other carrier receives orrelinquishes control over the goods. Courts in different jurisdictions may thus interpret thisrequirement quite differently.

Thirdly, the loss, damage or delay must have occurred by some event that could only have occurredby reason of the carriage by the other means of transport. This is an issue of causation: whether theloss, damage or delay was caused by some event that took place during the carriage by the othermode of transport. This third requirement is capable of a broad and a narrow interpretation. Under anarrow interpretation, emphasis is placed on the words “could only have occurred in the course ofand by reason of the carriage by the other means of transport” and the nature of the event that causedthe loss, damage or delay. Following this narrow interpretation, the exception could only be invokedif the event that causes the loss, damage or delay is typical or characteristic of the other mode oftransport, for instance damage by seawater is only capable as a result of carriage by sea. A broadinterpretation of this third requirement focuses on causation to determine whether there was anevent that occurred during the carriage by the other means of transport which caused the loss,damage or delay. Under this broad interpretation, what is important is that the event occurred as aresult of the vehicle being carried by the other means of transport. This requires a case-by-caseassessment.

For example, in Thermo Engineers, it was argued that the heat exchanger could also have beendamaged in the same way, i. due to a collision, during the road carriage since it could have stuck outover the trailer during the road carriage and collided with a bridge or viaduct. The court in that caseemphasized that what is relevant is not that the nature of the event causing the loss, damage or delaycould only have occurred during the carriage by the other means of transport, but whether the eventon its own could have occurred during the carriage by the other means of transport. In this case, the

6 Thermo Engineers v Ferrymasters [1981] 1 All ER 1142.7 Cour d'appel d'Aix en Provence, 30 May 1991.

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damage occurred during loading due to a collision with the bulkhead, and collision with a bulkheadwas in this case only possible during sea carriage.

In the Dutch case St Clair, 8 the Dutch Supreme Court had to consider this condition in relation to aconsignment of textile that was carried by road from Meerssen to Tunisia. For the leg from Marseilleto Tunisia, the vehicle containing the textile was carried on the vessel the St Clair. A fire broke out andit was not possible to put it out. The ferry and everything on board, including the vehicle carrying thetextile was lost. The Supreme Court had to consider whether this was an event which could only haveoccurred by reason of the carriage by the other means of transport. The discussion focused onwhether the event causing the loss had to be something typical for the mode transport (narrowinterpretation) or whether it relates to an event that took place during the other means of transport(broad interpretation). After all, fire is not an event that is characteristic or typical of sea carriage, butsomething that can occur during other modes of transport as well. The Supreme Court looked to thepurpose of the provision which was to avoid that the liability of the road carrier towards the senderwould extend beyond the liability of the carrier by the other means of transport towards the roadcarrier – i. the avoidance of a liability gap – so that the road carrier would avoid the situation ofbeing liable to the sender without having the possibility of full recourse against the carrier when hedid not play a part in the loss, damage or delay. In light of the underlying purpose, the Supreme Courtadopted a broad interpretation focusing on whether the loss in the concrete case was caused duringand as a consequence of an event that took place on the other means of transport. In this case, theloss resulted from a fire that destroyed the vessel on which the vehicle with textile was being carried.

If these conditions have been met, the liability of the road carrier shall be determined in the mannerin which the liability of the carrier by the other means of transport would have been determined if acontract for the carriage of the goods alone had been made by the sender with the carrier by the othermeans of transport in accordance with the conditions prescribed by law for the carriage of goods bythat means of transport. This requires the court to establish a hypothetical contract between thesender of the goods and the carrier by the other means of transport in accordance with the conditionsthat would be applicable as mandatory law to that contract of carriage. For example, where the othermeans of transport is sea carriage, it would be necessary to imagine a hypothetical contract of carriagebetween the sender of the goods and the sea carrier in accordance with the Hague Visby Rules.

8 Supreme Court, the Netherlands, 14 June 1996, S&S 1996, 86.

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court held that the construction of the hypothetical contract does not depend on the actualcircumstances agreed between the sea carrier and the road carrier. 12

The consequence of this exception is that the road carrier’s liability is no longer determined inaccordance with the CMR, but instead he may rely on the defences and limitations of liability of thelaw applicable to the other mode of transport. This is reasonable since the damage or loss was notcaused by the road carrier, but occurred during the responsibility of the carrier of the other mode oftransport. Nevertheless, the road carrier will be held liable under the CMR without the ability toexercise adequate recourse against the other carrier. If the sender would have concluded thecontracts separately, he would have been confronted by this other set of rules anyway. The sendercan anticipate that the goods will need to be transported for some part of the journey using anothermode of transport in order to, for instance, cross water. Therefore, application of the other liabilityregime is not entirely unexpected.

Where the Convention is applicable, Article 41 determines that it may not be derogated from, neitherin favour of the sender nor in favour of the carrier.

3. The Consignment Note

Carriage of goods by road is generally covered by a consignment note. Like to bill of lading, theconsignment note functions as a receipt of the goods received by the road carrier and evidence of thecontract of carriage and its terms. Article 9 provides that “The consignment note shall be prima facieevidence of the making of the contract of carriage, the conditions of the contract and the receipt ofthe goods by the carrier”. Unlike the bill of lading, the consignment note is not a document of title.

In accordance with Article 5, there will be three originalcopies of the consignment note which are signed by thesender of the goods and the carrier. The first copy ishanded to the sender, the second accompanies the goodsand the third is retained by the carrier. Where multiplevehicles are used or different kinds of goods are beingcarried, separate consignment notes may be made out foreach vehicle used or for each kind of good.

Article 6 determines what should be included in theconsignment note, in particular it should identify thesender and the carrier, the place of taking over the goodsand the place designated for their delivery, the name andaddress of the consignee, the description of the goodsand the method of packing, the number of packages andweight of the goods, the charges and any instructionsfrom the sender. When the carrier takes over the goods,

12 Hof van Antwerpen, 22 December 1997, (1998) ETL 399-418.

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he must check the accuracy of the statements in the consignment note as to the number of packagesand their marks and numbers, and the apparent condition of the goods and their packaging. Article9(2) provides

If the consignment note contains no specific reservations by the carrier, it shall be presumed,unless the contrary is proved, that the goods and their packaging appeared to be in good conditionwhen the carrier took them over and that the number of packages, their marks and numberscorresponded with the statements in the consignment note.

4. Right of Disposal and Identity of the Carrier

The sender is the party who has concluded the contract for the carriage of goods with the carrier. Theconsignor is the person from whom the goods are taken over and the consignee is the person who isto take delivery of the goods. The sender could therefore also be the consignee or the consignor.

Article 12 regulates the right of disposal over the goods. The sender of the goods has the right todispose of the goods, for instance by asking the carrier to stop the goods in transit, to change the placewhere the goods are to be delivered, or the person to whom the goods are to be delivered, unless atthe time the consignment note is drawn up, the sender makes an entry to the effect that the consigneeis to have that right. The sender’s right of disposal ceases to exist once the second copy of theconsignment note – the copy accompanying the goods – has been handed to the consignee, or oncethe consignee exercises his right under Article 13(1) once the goods have arrived at the placedesignated for delivery to require the delivery of the goods and the second copy of the consignmentnote.

In the carriage of goods by road, frequently, more than one carrier may be involved. It thereforebecomes important to identify which carrier is responsible for the goods and can therefore be heldliable for any loss, damage or delay. The starting point is that the carrier is the party who has enteredinto the contract of carriage to undertake the carriage of goods from the place they are taken overuntil the place designated for delivery. A party may still be held to be the carrier even if itsubcontracted the performance of the entire carriage to another carrier. 13 This means that althoughthe carrier may be merely a carrier on paper, he remains responsible for the goods as the carrier.

The carrier may sub-contract the carriage or engage other carriers as successive carriers in theperformance of the carriage. Where the carrier sub-contracts the carriage, he enters into a separatecontract of carriage with the sub-carrier. The sub-carrier will issue its own consignment note to thecarrier. The sender of the goods will have no right to action under the sub-contract, should the goodsbe lost, damaged or delayed since there is no contractual relationship between the sender and thesub-contractor. For the purposes of the sub-contract, the sender is the primary carrier who has sub-

13 Ulster-Swift Ltd and Pigs Marketing Board v Taunton Meat Haulage Ltd and Fransen Transport N., (C.)[1977] 1 Lloyd’s Rep 346

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The Complicated Case of Successive Carriage

The successive carrier system in the CMR is based on the idea and practice that carriers carry goods forindividual legs of a larger journey and pass goods and the respective CMR consignment note from onecarrier to the next. It is clear from Professor Loewe’s Commentary based on notes and recollections of thenegotiations of the Convention, that the provisions on successive carriage were not intended to be appliedto simple sub-contracting. He writes: “Where a person concludes a contract of carriage as a carrier butdoes not himself perform any part of the carriage, the provisions of article 34 et seq. cannot be applied”. 14It is interesting to note that the successive carrier concept in the CMR is modelled on the concept ofsuccessive carrier in the CIM concerning rail carriage. 15 The earlier versions of CIM was based on the systemof track and line monopoly of the railways in each country, making cross-border rail transport impossiblewithout successive carriage. This is, however, not comparable with transport by road, 16 which suggests thatthese provisions may be out-dated.

Articles 34 and 36 clearly suggest that all carriers carry successively under the same contract. Thisunderstanding is further supported by the provisions on the division of liability which identify the share inliability according to the share in the freight payment. The provisions on jurisdiction also support this,requiring that in case of claims between successive carriers where liability is to be divided between thesuccessive carriers, it is necessary that all successive carriers can be made party to the same proceedings.In contrast, in the case of sub-contracting, there is no share in the freight payable by the cargo owner. Eachcontract is made between individual parties for an agreed freight for the transportation. First between thecargo owner/sender and the primary/contractual carrier and subsequently between the primary carrierand a sub-contracting carrier, and possibly between the sub-contracting carrier and the sub-sub-contracting carrier. In such cases, the general rules of the CMR, including the general jurisdiction rules,apply to each individual contractual relationship.

Nevertheless, there is important litigation in England and the Netherlands which expands the concept ofsuccessive carrier and which requires consideration due to the far-reaching consequences for the actual,performing carrier.

One of the issues that has arisen is what involvement of carriers is necessary in order to be considered asuccessive carrier. For instance, can a contracting carrier be regarded as a successive carrier, even thoughhe has not performed any of the carriage himself? This issue was addressed by the English Court of Appealin Ulster-Swift Ltd and Another v Taunton Meat Haulage Ltd. and Another. 17 In that case, Ulster Swift hadcontracted Taunton to carry a consignment of 300 pork carcasses from Northern Ireland to Basel,Switzerland. The goods were loaded onto a refrigerated vehicle at the claimant’s premises. Thetransportation took five days. When the goods arrived at their destination, the goods were inspected andfound to be bad and were destroyed by the Swiss authorities. Ulster-Swift claimed damages from TauntonMeat Haulage. Taunton Meat Haulage had not carried the goods, but had sub-contracted the wholecarriage to Fransen Transport N. Fransen had issued the consignment note. The consignment noteidentified the goods’ owner as the consignor and Fransen as the carrier. Taunton claimed a declarationthat they were entitled to be indemnified by Fransen against any liability for which they might be judged

14 Loewe (1976), 311 at 297, para 276.15 Uniform Rules Concerning the Contract of International Carriage of Goods by Rail, being Appendix B to theConvention concerning International Carriage by Rail.16 Lamont-Black (2017), p. 15.17 [1977] W WLR 625; [1977] 1 Lloyd’s Rep. 346

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liable to Ulster Swift for any deterioration of the meat. Fransen relied on Article 32 CMR claiming that theTaunton’s claim was time-barred. Taunton in turn argued that this was a ‘claim between carriers’ for whichreason Article 39(4) would apply which provides for an extended period of limitation in relation to claimsbetween carriers. Fransen however argued that they were not successive carriers, in which case Article 39would not apply. Rather, they argued, since Taunton had sub-contracted the whole carriage, Fransen hadnot carried in succession to anyone and therefore they were not successive carriers. The Court of Appealrelies on the reasoning of Donaldson J in first instance:

“This scheme reflects the common, indeed the almost universal, situation where the owners of goods getin touch with a carrier and make the contract for the whole of the carriage with those carriers. It is thenleft to that carrier to sub-contract the successive stages of the carriage, and all those people are withoutdoubt, and nobody would dispute it, successive carriers. The only oddity here is that the primary carrier,the man who contracted with the owners of the goods, did not in fact undertake any stage of the carriagehimself. Looking at article 1, paragraph 1, I think that the CMR Convention must have contemplated thatfor this purpose the company, or individual, with whom the owner of the goods contracts, is the firstcarrier, whether or not he himself takes possession of the goods, and that all subsequent carriers are thesuccessive carriers within the meaning of these provisions.”

Consequently, the time bar of Article 39(4) and not the general time bar of Article 32 would apply to dealwith a claim for indemnity between carriers for compensation due to the consignor for the loss of his cargo.

The viewpoint that the contractual carrier is not required to perform any of the carriage himself, is notuniversally accepted, but has been supported by for instance the Austrian, German, Swiss and Dutchcourts. 18 Supporters of this approach, nevertheless argue that there must be a continuous chain of carrierswho all accept the goods and the consignment note; a new consignment note “will not do”. 19 This issuewas not addressed in Ulster Swift, and therefore it is questionable whether a true successive carriagerelationship in the spirit of the CMR exists where the primary contractor makes his contract with thesender, and a later carrier to whom he sub-contracts issues a consignment note for the wholetransportation, naming himself, rather than the primary contractor as carrier.

The successive carrier accepts the consignment note when he takes possession of it and accepts to bebound by it, its terms and what it says about the quantity and condition of the goods. The simple fact thatthe carrier has possession of the consignment note is not sufficient to amount to acceptance of a “veryspecial and sometimes onerous legal regime”, especially if the carrier has issued its own consignment noteas well. 20 The subsequent carrier must actually accept to be bound by the consignment note. Article 35requires the second or subsequent carrier to “enter his name and address on the second copy of theconsignment note”, which is the copy accompanying the goods. This enables the claimant to be able toidentify who to sue, it can also serve as evidence of acceptance of the consignment note.

In Coggins T/A PC Transport v LKW Walter International Transportorganisation AG, 21 the judge held thattaking over the goods and the consignment note could occur via an agent. Coggins had contracted to carrygoods for LKW on the basis that Coggins would sub-contract the carriage to sub-contractors. Coggins wouldthen render LKW with the consignment note to obtain payment. The sub-contractor was however found

18 See Lamont-Black (2017), cases referred to p. .10.19 ibid.; Clarke (2014), par. 50b.20 TC Brussels 11.5 (1988) 23 ETL 720, 725.21 [1999] Lloyd’s Rep 225.

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qualify this simple meaning by requiring compliance with the provision of art. 35... Suppose that a carriertakes delivery of the goods from a previous carrier together with a copy of the consignment note with aview to carrying out the next part of the carriage under the terms of the consignment note, but fails toenter his name and address, or perhaps enters his name but fails to enter his address, in the copy of theconsignment note. That cannot, in my judgment, mean that there has been no acceptance of theconsignment note within art. 34”.

It is therefore necessary that there must be actual acceptance of a consignment note. This is also importantfor practical reasons. Since the successive carrier will become responsible for the whole carriage, he needsto be made aware of this. In particular where a subsequent carrier is performing a solely domestic leg ofthe journey, it may not be aware of the application of the CMR and otherwise believe that it is protectedby his standard trading conditions. In general, continental courts also uphold that acceptance of aconsignment note is an essential formal requirement. Although the Belgian courts have conflicting viewson this. One first instance Belgian court has held that although acceptance of the consignment note isevidence of acceptance of the international contract by the successive carrier, it is not the only factor. 25However, the Belgian Supreme Court recently held that receipt of the consignment note was necessary fora carrier to be successive carrier and that knowledge of taking part in an international carriage was notsufficient. 26

Where sub-contracting carriers issue separate consignment notes, there is evidence that they are notsuccessive contractors. In Flegg Transport Ltd v Brinor International Shipping and Forwarding Ltd, 27 it washeld that successive carriers must carry under the same CMR consignment note. Where a contractedcarrier transported the goods in part himself and sub-contracted the further leg to a sub-contractor whoissued a consignment note for the leg performed by him, the sub-contractor was not considered asuccessive carrier because they did not carry the goods under the same contract. Although a carrier couldaccept the goods and the consignment note for a carrier higher up in the chain, this was only possible forthe contract covered by the consignment note and in this case, there were separate contracts/consignmentnotes. Consequently, there can be more than one CMR contract resulting from the original contract ofcarriage. That successive carriers must carry under the same contract is widely accepted in variousjurisdictions. For instance, in a Belgian case, the sub-contracted carrier issued his own consignment notefor the part of the journey performed by which meant that he was not a successive carrier, even thoughhe had received the original consignment note and presented both consignment notes to the consignee’sagent on arrival. 28

In British American Tobacco Switzerland SA and others v Exel Europe Ltd and other, 29 Lord Manceconsidered the combined effect of Coggins and Ulster-Swift. In that case, the primary carrier, Exel, sub-contracted the transportation of two consignments of tobacco products to Essers and Kazemier. Essers andKazemier collected the goods and issued consignment notes in their name as carriers and named therespective cargo interests as consignors. The parties proceeded on the understanding that all carriersinvolved were successive carriers within the meaning of Article 34. Lord Mance opined:

“12. The common ground between the parties in the present case involves necessarily their acceptance

25 Rechtbank Brussel, Belgium, 6 April 1984 (1984) 19 ETL 431.26 Hof van Cassatie, Belgium, 12 April 2013.27 [2009] EWHC 3002.28 Comm Bruxells, 11.5 (1988) 23 ETL 720.29 [2015] UKSC 65.

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that on or other of the Essers companies in the case of the first container and Kazemier in the case of thesecond was a successive carrier within article 34. In this connection, the present parties are content toproceed on the basis, said in Professor Malcolm Clarke’s work International Carriage of Goods by Road:CMR, 6th ed (2014), para 50a(i) to be ‘disputed’ but accepted by both Donaldson J and the Court of Appealin Ulster-Swift v Taunton Meat Haulage Ltd [19750 2 Lloyd’s Rep 502, 507; [1977] 1 Lloyd’s Rep 346, 358-361 and by other national courts, that, where (as here) a company contracts to carry goods, butsubcontracts the whole performance, the first company is for CMR purposes the first carrier, while thesecond becomes a successive carrier. Further, although article 4 of CMR provides that ‘The contract ofcarriage shall be confirmed by the making out of a consignment note’, it continues by saying that ‘Theabsence, irregularity or loss of the consignment note shall not affect the existence or the validity of thecontract of carriage which shall remain subject to the provisions of this Convention’.

However, article 34 provides that a second or succeeding carrier only becomes a successive carrier by‘becoming a party to the contract of carriage, under the terms of the consignment note, by reason of hisacceptance of the goods and the consignment note’. At this point, therefore, it might seem that theexistence of a CMR note was of importance, and Professor Loewe, in a ‘Commentary on the Convention 19May 1956 on the Contract for the International Carriage of Goods by Road (CMR)’, prepared for the UnitedNations in 1975 and expressed at para 16 to be ‘based on the preparatory work, on personal notes andrecollections of the negotiations, and on the logic and spirit of the Convention itself’, indicates at para 275that the language of article 34 was directed to ensuring that successive carriers were made aware throughthe consignment note that the carriage which they were undertaking (perhaps only for one part, andpossibly even within only one country’s territory) was international carriage subject to the provisions ofCMR. There appears in the present cases at least a real possibility that the two CMR consignment notesonly came into existence at the time when the relevant Essers company and Kazemier collected therespective consignments and signed the relevant CMR consignment notes. Whether article 34 can apply tosuch a case is a point which we can however leave open, since the parties are prepared without furtherexamination to proceed on the basis that these appeals both concern successive carriage, by the relevantEssers company or companies and by Kazemier, within the terms of article 34.”

The Dutch Supreme Court also had occasion to consider the requirements under Article 34 CMR inBeurskens v Veldhuizen. 30 In that case, the Supreme Court appears to abandon its previously narrowerapproach to Article 34 to accept the extended approach that reflects BAT v Exel. In that case, HewlettPackard instructed Trans-O-Schnell Lieferdienst GmbH, a German logistics provider, to transport computerequipment from the Netherlands to Germany by road. Trans-O-Schnell instructed the Dutch carrierBeurskens, who in turn instructed Veldhuizen, another Dutch carrier. Veldhuizen collected the goods andissued a CMR consignment note naming HP’s warehouse as consignor; no entry was made as to the carrieror successive carrier. While the vehicle was parked at Veldhuizen’s premises, some goods were stolen.Trans-O-Schnell paid the full damages for the stolen goods to Hewlett Packard and then sued hiscontracting party Beurskens in Germany. Beurskens unsuccessfully sought to rely on the package limitationand had to pay the full value to Veldhuizen. Beurskens then initiated proceedings against Veldhuizen in theNetherlands arguing that Veldhuizen as the successive carrier responsible for the loss of the goods shouldreimburse Beurskens for the compensation it had paid to Trans-O-Schnell.

The Dutch Supreme Court relied on Article 31 of the Vienna Convention on the Law of Treaties to interpretthe CMR. It suggested that the object and purpose of Chapter VI of the CMR was to enhance recoveryprospects by both cargo interests against successive carriers and carriers seeking recourse. On this basis, it

30 Supreme Court, the Netherlands, 11 September 2015, Case No. 14/03211, NJB 2015/1635, S&S 2016/1.

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the chain for any recourse claims according to Article 39, with whom the performing carrier made nocontract seems wholly inappropriate, unless the carrier was warned or put on guard, which according tothe wording of Article 34 was supposed to be achieved by the taking over of the goods and the consignmentnote, which was to include the names of the other carriers. It is therefore submitted that Chapter VI isunsuitable to be applied to matters of mere sub-contracting and broad inroads create uncertainty and maylead to undesirable consequences.

Undesirable consequences of broad interpretation

A broad interpretation, as in the recent Dutch Supreme Court decision, while allowing the alignment ofcompensation between different parties and thus full recourse, might, on the other hand, open thefloodgates to forum shopping even further: it will become even more important to open court proceedingsas quickly as possible in the most advantageous forum, to possibly join as many parties to the proceedingsor at least notify them, so that the effect of the proceedings will be upheld in recourse claims.

The Dutch extended view would mean that any carrier in the chain can then seek recourse from theperforming carrier down the line, irrespective of when and why it had paid compensation and base itsrecourse amount on any court judgments fixing the amount of compensation as long as the performingcarrier was notified of the proceedings.

To safeguard his position in this extreme, it would then become advisable for every performing carrier,ideally even before delivery of the damaged goods or notice of their loss to the consignor and to hiscontractor, to start proceedings for non-liability of for liability to the value of the package limitation only,while involving as many others in the chain of sub-contractors as possible. However, he is unlikely to knowthen all. But more so, to push every cargo claim to the court system to safeguard the position of theperforming carrier seems an immense waste of resources.”

Lamont-Black concludes: 34

“The concept of the successive carrier is outdated. The system of successive carriers is dependent on all itsprovisions working together to be appropriate and desirable: narrow and strictly interpreted. This conceptno longer fits in with the modern realities of road transport but rather undermines the value judgmentsmade in the CMR and the purpose of its strict application.

Other transport modes, apart from rail carriage, do not apply a similar regime. In effect, this regimenowadays facilitates abuse of the actual carrier, who often, after a long line of sub-contracts, may carrythe goods with full exposure to liability for freight substantially lower than that charged to the customerby the primary or contracting carrier. It is therefore submitted that the concept should be abolished andreplaced by the actual carrier concept found in the air and sea conventions allowing cargo interests to suethe actual carrier and giving a short additional limitation period for recourse claims between carriers. Inthe absence of any amendment to the CMR, courts should apply a narrow interpretation of the successivecarrier concept.

While back-to-back liability and straightforward recourse is the ideal for freight forwarders and the merelycontracting but not performing carriers, the CMR was written with the interest of both cargo interests andthe actual or performing carrier in mind. To be able to conduct swift and effective business and to limit hisexposure, the (actual) carrier should be able to close his books after the time bar period had elapsed. The

34 Lamont-Black (2017), p. 20.

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wide and varying interpretation of the successive carrier regime beyond its initial remit, leads touncertainty and to increased exposure of the weakest in the chain, the actual carrier. It also as theundesirable potential to clutter the court system with preventative claims by carriers against as many other‘carriers’ and sub-contractors as can be identified and thus might lead to a significant increase of litigationand other friction costs.”

5. The Carrier’s Responsibility

The primary obligation of the carrier is to deliver the goods to the place designated for delivery ontime and in the same condition they were in when he took them over. Article 17(1) provides that thecarrier will be liable for any loss, damage or delay in delivery occurring between the time he took overthe goods and the time designated for delivery. This provision indicates that the responsibility of thecarrier does not begin with the actual carriage, but can arise earlier when he “takes over” the goods.For the purposes of liability under the CMR, the carrier must “take over” the goods for the purposesof carriage. Sometimes, carriers have possession of the goods for other purposes such as warehousingor packing prior to the commencement of carriage. These are ancillary to the carriage, and the carrier’sliability will fall under domestic law. It will depend on the particular facts of the case, when suchancillary operations ceases and performance of the contract of carriage commences for the purposesof liability under the CMR. 35 In a Dutch case, it was held that loading the goods on to the vehicleamounts to taking over the goods for carriage. 36 Similarly if the phrase “prise en charge sur camion”(taken over on lorry) is used, the carrier is regarded as taking over the goods at the moment at whichthey are loaded in the vehicle. 37 The Convention does not contain a definition of delivery, and thusthe cessation of the carrier’s responsibility under the CMR. Generally, delivery is the handing over ofpossession to another party, the consignee or his agent. 38 It is unclear whether the goods have to beunloaded for delivery to take place, or whether the carrier has delivered if he warehouses goods onarrival at the destination has delivered. The German courts have held that delivery takes place whencontrol of, or the right to exercise authority over, the goods has been transferred from the carrier tothe consignee. 39 For delivery to take place, the consignee must accept the goods; the mere arrival ofthe vehicle at the destination is not sufficient. 40

Article 20 provides that the fact that the goods are not delivered within thirty days following the expiryof the agreed time-limit, or, if there is no agreed time-limit, within sixty days from the time when thecarrier took over the goods, shall be conclusive evidence of the loss of the goods, and the personentitled to make a claim may treat them as lost. Article 19 provides that goods are delayed in delivery

35 Messent and Glass (2018), par. 6.36 Hof ‘s Gravenhage, the Netherlands, 15 June 1979 (1980) 15 ETL 871.37 Messent and Glass (2018), para. 6; Court of Appeal Paris, France, 16 May 1969 (1969) BT 190, (1969) ETL896.38 Messent and Glass (2018), para. 6.39 OLG Zweibrücken, Germany, 23 September 1966, I. 40/67 (1967) NJW 717; LG Frankfurt am Main, Germany,14 May 1965 3/30, 228/64 cited in Messent and Glass (2018), para. 6.40 See case law referred to by Messent and Glass (2018), para. 6.

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vehicle. The court rejected the argument that the damage was partly due to the act of the claimant,since the additional damage in moving the cylinder was a direct result of the road accident. 47 Inanother case, the vehicle carrying the goods was delayed at a customs car park because of defects inthe documents supplied by the sender, and was then stolen while left unattended. The loss of thegoods was held not be sufficiently related to the fault of the sender to excuse the carrier. 48

The main reasons for which the sender will be held responsible for the loss or damage will relate toacts performed by the sender, such as defective packaging of the goods, faulty handling, loading,stowage and, unloading by the consignee. However, these issues are covered by Article 17(4). Themain situations in which the carrier is likely to rely on Article 17(2) is when the claimant has beennegligent in supplying relevant information, failing to supply proper documentation, or failing to giveinstructions as to the appropriate precautions in respect of a particular risk. 49 However, this will alsodepend on the specialist knowledge of the parties. For example, a carrier should know that althoughwine can withstand a little cold weather, it is susceptible to damage if subjected to extreme cold. Sincesuch cold weather in winter is not rare in Northern Europe, the carrier need not be told about theneed for providing adequate protection. 50 In another case, the sender instructed the carrier to set thethermostat at 2 0 C for the carriage of nectarines, which then arrived damaged by frost. The carrier waswell aware of the conditions necessary for the carriage of such goods and since the sender would notknow the internal temperature of the vehicle, the carrier was not allowed to claim that the instructionsof the sender were the sole cause of the damage and had to accept a share in the responsibility. 51 TheGerman courts have held that the claimant’s instructions need to be binding on the carrier in order torelieve him of liability. 52

The inherent vice of the goods referred to in Article 17(2) relates to a latent defect in the goods thatresults in damage or destruction during transportation. Examples include faulty manufacturingprocess, spontaneous combustion during ordinary carriage conditions, or moisture content causingcondensation damage. In TM Noten BV v Hardin, 53 industrial leather gloves were shipped fromCalcutta to Rotterdam. On arrival, they were found to be wet, stained, moulded and discoloured. Themoisture in the gloves condensed to form water droplets from the roof which damaged the gloves.The court held the gloves had an inherent vice. In a French case, an inherent defect was regarded as“the deterioration of the goods because of an internal cause”, 54 for example, fruit infected with adisease before it was carried suffers from an inherent defect. 55 In Germany, there is some discussionabout the relationship between Article 17(2) and Article 17(4)(d). It is generally considered that goodswhich are generally prone to damage should be covered by Article 17(4) (typical condition of cargo),

47 Comm Tournai, France, 21 November 1972 (1972) JPA 446.48 Cour de Cassation, Belgium, 12 December 1980 (1981) 16 ETL 250.49 Messent and Glass (2018), para. 6.50 Messent and Glass (2018), para. 6: Court of Appeals Nimes, France, 18 May 1988 (1988) BT 472.51 Cour de Cassation, France, 19 April 1982(1982) BT 309, (1983) 18 ETL 13. Messent and Glass (2018), para. 6.52 Koller, Art. 17 CMR, para. 32.53 [1989] 2 Lloyd’s Rep 527.54 Rouen Court of Appeal, 28 June 1990, case no. 2151/88.55 Court of Appeal Aix-en-Provence, France, 21 June 1985, case no. 83/6119.

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whereas cargo that is not usually and generally susceptible to loss should be covered by Article 17(2)(non-typical condition of cargo). 56

Unavoidable circumstances the consequences of which the carrier was unable to prevent may includetheft, robbery or hijacking, vandalism or arson, collision or weather. The Silber v Islander Truckingcase 57 suggests that the words “could not avoid” includes “even with utmost care”. It is therefore ahigh threshold for the carrier to meet. In Michael Galley Footwear v Laboni, 58 the carrier was sued forthe loss of a consignment of shoes. The driver and his assistant had parked the vehicle at an unguardedparking lot to have a meal. For them to have driven to a guarded parking lot would have meant drivingagainst the driving period regulations. They had turned on the alarm; however, thieves were able todisable the alarm and stole the consignment. The court held that the carrier could have prevented theloss if the driver and his assistant had taken in turns guarding the vehicle. The carrier could not invokeArticle 17(2) and was held liable.

The French courts use both the French concept of force majeure and the CMR’s concept ofcircumstances which the carrier could not avoid and the consequences of which he was unable toprevent. It should be noted that the concept of force majeure is stricter than Article 17(2). A forcemajeure event that could neither be anticipated upon entering into the contract nor avoided upon itsoccurrence and prevents the obligation from being performed. 59 In contrast, under Article 17(2), it isirrelevant whether the event could have been anticipated. Aggravated larceny has been held to be anevent that amounted to circumstances which the carrier could not avoid and the consequences ofwhich he was unable to prevent if carried out in such a violent manner that it could not be avoided orprevented. 60 Also held to be exempted under Article 17(2) have been a fire due to a foreign bodyrubbing against a tyre; 61 weather conditions declared to be a natural disaster; 62 a decision by customsofficials to continue with a strike as the carrier is about to cross the border; 63 a traffic accident atnight. 64

In comparison, the Dutch Supreme Court held the goods were lost as a result of armed robbery, thecarrier can only rely on the exemption from liability under Article 17(2) if he has taken all measuresthat can be expected of a reasonable carrier. 65 In that case, the gates at the address where the carrierwas to deliver the goods were closed, rendering delivery impossible. The driver then parked thevehicle at an unguarded parking lot where the goods were subsequently stolen. The driver’s failure todrive a further 50-60 km to a guarded parking lot meant that the carrier had not taken all reasonablemeasures to avoid the circumstance leading to the loss. Although it was argued by the carrier that thiswould have led to a violation of the driving times regulation, the court held that it was not established

56 Eckardt, in Gruber et al., p. 48.57 [1985] 2 Lloyd's Rep. 243.58 [1982] 2 All ER 200.59 Cour de Cassation, Plenary Assembly,France, 14 April 2006, case no. 02-11.60 Cour de Cassation, Commercial Division France, 9 April 2013, case no 11-28.61 Versailles Court of Appeal, France, 8 April 2010, case no. 09/00315.62 Paris Court of Appeal, France, 2 October 2014, case no. 12/19914.63 Orléans Court of Appeal, France, 12 November 1996, case no. 94/003206.64 Metz Court of Appeal, France, 30 October 1990, case no. 88/1313.65 Supreme Court, the Netherlands, 17 April 1998, NJ 1998, 602 (Oegema/Amev).

Carriage of Good by Road - © Nicole Kornet 2018. All rights reserved. This text has been produced - Studeersnel (2023)

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