Their Lordships have taken a strict approach to the interpretation of the CMR Convention and overturned the Court of Appeal’s decision on jurisdiction in respect of successive carriage under CMR Article 31. The decision was unanimous given the clear language of the CMR provisions, albeit that some of their Lordships had needed persuasion to move from the commercially logical view adopted by the Court of Appeal.

These were two appeals brought before the Supreme Court by Dutch subcontractors.  Briefly, the first case, British American Tobacco Denmark A/S & Ors –v- Kazemier Transport BV [2015] UKSC 65, concerned carriage between Switzerland and The Netherlands, with the container of tobacco allegedly hijacked in Belgium. The second case, British American Tobacco Switzerland SA –v- H Essers Security Logistics BV & Anr [2015] UKSC 65, involved carriage between Hungary and Denmark with the tobacco stolen in Denmark. In the two cases, the consignors had brought proceedings in England against both the English first/contracting carrier and the Dutch subcontractor (as last and/or performing CMR carrier). No doubt cargo interests believed English jurisdiction to be an advantage since the English courts allow the recovery of duty in full under Article 23(4) CMR (even though the claim in respect of the value of the goods may be capped by the weight limit under Article 23.3). The Supreme Court also appreciated that it might be beneficial to bring all carriers within one set of proceedings for evidential reasons particularly if there was a suggestion of wilful misconduct. 

There was no dispute for these purposes that the Dutch subcontractor was a successive carrier within Article 34 CMR. The question before the Supreme Court was whether the English court has jurisdiction against the Dutch successive carrier on the basis that it has jurisdiction against the English first carrier.

In other words, is it possible to read Articles 31 and 36 together ‘so that, once a claimant has established jurisdiction against one defendant under Article 31.1(a), it can then bring into that jurisdiction any other successive carrier potentially liable under Article 36’?

Article 31(1) CMR allows a claimant to bring proceedings in the court of a contracting country ‘designated by agreement between the parties’, and:

  1. where the defendant carrier ‘is ordinarily resident, or has his principal place of business, or the branch or agency through which the contract of carriage was made’, or
  2. ‘where the goods were taken over by the carrier or the place designated for delivery is situated,

and in no other courts or tribunals.'

Article 36 CMR, under the successive carriage provisions, provides that legal proceedings may be brought against the first carrier, the last carrier or the performing carrier and that ‘an action may be brought at the same time against several of these carriers’.

In short, the Court of Appeal had viewed the latter part of Article 36 as providing additional bases for finding jurisdiction. That approach was firmly rejected by the Supreme Court. Lord Mance, giving the leading judgment, considered that the CMR Convention must be read as a whole (not as ‘a series of sequential provisions, each unconscious of what was to follow’). He concluded that Article 31 clearly applies to disputes between cargo interests and successive carriers, and not simply to issues between cargo interests and the original CMR carrier. In other words, Article 31 provides a complete code regarding jurisdiction for claims by cargo interests, whether those claims lie against a first/contracting carrier and/or a successive carrier. That was a view echoed by the four other judges: in the judgment given by Lord Sumption (with whom Lord Neuberger, Lord Clarke and Lord Reed all agreed), he held that Article 36 is not concerned with jurisdiction: ‘It certainly does not confer jurisdiction if it does not otherwise exist’. In other words, it provided no jurisdictional extension to Article 31(1). As Lord Clarke further noted, ‘the language of the CMR points clearly in the other direction’.

In the present scenario, the consignors also relied on the fact that their contract with the first CMR carrier was expressly subject to English law and jurisdiction. (Interestingly, but of no direct legal relevance, the contract between that first carrier and the subcontractor was similarly subject to English law and jurisdiction.) However, while it was accepted that the Dutch subcontractor became a party to the contract as between the consignor and the first carrier, the Supreme Court was swayed by the fact that, under Article 34, a successive carrier becomes party to the contract specifically under the terms of the consignment note. It was considered to be a step too far to hold that a successive carrier would be bound by an express choice of jurisdiction clause where that clause was not evidenced by the consignment note and where the successive carrier had no notice.

Other, but rather less convincing, arguments were run by cargo interests to support their argument that the English court has jurisdiction over these Dutch subcontractors. A significant argument focused on Article 6(1) of the Brussels Regulation ((EC) No 44/2001), pursuant to which a ‘person domiciled in a member state may also be sued: … where he is one of a number of defendants, in the courts for the place where any one of them is domiciled, provided the claims are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings’. This did not assist cargo interests. The Supreme Court rejected their argument, with Lord Mance viewing the CMR Convention as ‘deliberate and comprehensive’, again a complete code, and one which ‘represents a balanced jurisdictional regime’ adopted across a number of states, not exclusively EU member states.

Comment:

It remains the case that cargo interests may pursue a claim against the first, last or actual CMR carrier in whichever country that carrier is located. The decision of the Supreme Court simply prevents other carriers being added as defendants if that country is not also where the goods were taken over or where they were to be delivered. So cargo interests may still pursue a CMR claim in England and take advantage of the possibility of a full duty recovery if the carrier they are pursuing is English (or if that carrier has agreed to English jurisdiction). The Supreme Court’s decision will only be of commercial importance if the English carrier is penniless and without insurance cover.

Note also that a successive carrier is not bound by provisions agreed between cargo interests and the contracting (first) carrier if those provisions are not set out in the CMR note (unless perhaps the successive carrier has been given separate express notice of those provisions). So if cargo interests require a particular routing or special security arrangements, they would be best advised to record those requirements in the CMR note to ensure that any claim based on failure to adhere to the requirements may be pursued not only against the contracting (first) carrier but also against the last and actual carriers.