A Danish fish feed manufacturer sold 48 pallets of fish feed to a Norwegian buyer for DKK 402,624 on local delivery (DAP) terms. The manufacturer booked the transport of the cargo from Denmark to Fin-nangerøya in Norway to a Danish contract carrier who loaded the pallets into a trailer and subcontracted the execution of the transport to a Danish carrier. Upon picking up the loaded trailer on January 19, 2021, the carrier received the consignment note for the transport, which indicated that the shipment included 48 pallets of fish feed weighing 29,300 kilos.
On January 18, 2021, during transport near Østersund in Sweden, the car and trailer overturned on its side due to slippery roads. The carrier immediately requests help, which arrives within 30 to 45 minutes. The rescue company recovered the pallets from the trailer using a crane, and 34 big bags were brought by the rescuers from the scene of the accident and deposited by the rescuers in an open-air warehouse where they were exposed to snowdrifts.
By email dated January 19, the carrier’s motor vehicle liability insurer informed the carrier that a traffic accident had occurred and that the goods had been recovered and asked the carrier to take charge of the goods:
Hello again, I have just been informed that the goods will be stored at the owner’s expense in a warehouse. The address is Furulid 105, Østersund, Sweden. The goods are stored at the owner’s cost and risk and according to information there is a charge of 100 Sec per day for storage. However, I am not sure of the amount, as this is third hand information. As previously stated, I must encourage the owner of the goods to collect the goods as soon as possible and to calculate/document/limit any damage.
By subsequent letter dated January 19, 2021, the carrier further notified the carrier of the following:
As far as I know, a car was sent to pick up the goods. Can you confirm it? It is important that the property owner activates their property insurance as soon as possible so that they can help document and limit the damage, as it is the property owner’s duty to do so.
The information in question was not passed on to the manufacturer by the carrier, and it was not until February 9, 2021 that the carrier informed the manufacturer where the goods were and how they could be transported home. When the pallets were returned to the manufacturer on February 19, 2021, it was found that the 34 big bags had been destroyed following exposure to snow and humidity. The manufacturer’s insurer filed a lawsuit against the carrier and the carrier. The carrier also filed an exemption claim against the carrier.
The court concluded that the carrier was liable for damage to the bags during storage at the rescue service:
It appears from the inspection reports of February 19, 2021 that the damage suffered by 9 big bags could in part be attributed to the traffic accident. Furthermore, the court finds that the damage caused to the remaining 25 big bags can be attributed to the failure to limit the damage related to the storage and handling of the goods in the period following the accident, until the goods be returned to [Manufacturer]who [the carrier] should also be considered responsible.
The court then ruled that the carrier was not responsible for the damage to the 25 big bags, as they had been damaged during storage by the emergency services, i.e. after the carrier’s liability was deemed to have ceased:
With regard to the remaining 25 big bags, the court assumes that [the haulier] after the traffic accident, contacted his insurance company, which then organized the rescue of the goods, which were first placed in a nearby parking lot and then moved to a warehouse consisting of an open building [the haulier] contacted [the carrier] and declared that the transport could not be carried out and indicated where the goods were stored. [The haulier] call for [the carrier] to recover the goods as soon as possible. [The carrier] however replied in this regard that additional information from his insurance company was awaited before taking action on the goods. The damage to the remaining 25 big bags occurred in the period following the traffic accident and after [the haulier] had informed [the carrier] on where the goods were left, and after [the haulier] asked for further information on the continuation of the course. After requesting instructions, as well as the handing over of the goods to a third party, who, on the basis of the present, has been carefully chosen, [the haulier] is acquitted of the request for exemption submitted by [the carrier] concerning the remaining 25 big bags.
It appears from the judgment, in accordance with the Convention relating to the contract for the international carriage of goods by road (the CMR Convention) that a carrier, when an impediment has occurred to the performance of the carriage, may cause the its carrier for a purpose by requesting instructions from the other party, pending receipt of these instructions and, if these are not given within a reasonable time, dismantling the goods at the risk and peril of the other party.
Arrangements can be made by handing over the goods to a third party, and, if carefully selected, the carrier will not be liable for any errors or omissions by such third party. It is clear from the judgment that this is a condition for the carrier to end its CMR liability by carefully following the procedure described, so that the contracting party has the possibility of safeguarding his interests in the situation that has arisen. Since the carrier had not provided any information on the whereabouts of the goods and had not asked for instructions, the carrier’s CMR liability had not ceased. On the other hand, the carrier had fulfilled the conditions of the CMR and was therefore not liable for damage occurring during storage.
For more information on this subject, please contact Jesper Windahl to WSCO Advokatpartnerselskab by telephone (+45 3525 3800) or by e-mail ([email protected]). The WSCO Advokatpartnerselskab website can be accessed at www.wsco.dk.