Facts
Decision
Comment


Facts

On 24 April 2020, a Danish freight forwarder (S) entered into two agreements with an air carrier (L) regarding the chartering of aircraft with a view to carrying out two flights, from Hong Kong to Stockholm, carrying:

  • hand sanitizer, which is considered to be "dangerous goods"; and
  • textiles – in particular, protective equipment against covid-19.

The first flight was scheduled to depart on 3 May 2020. The freight was agreed at 1.7 million Danish krone.

The charter stated, among other things, that the freight was to be considered to have been earned by L, regardless of whether the goods were damaged or lost or not delivered at the destination (corresponding to the International Air Transport Association's Conditions for Carriage):

Carrier shall be entitled to the payment of alle applicable charges, whether prepaid or collect, fees, duties, taxes, charges, advances and payments made or incurred or to be incurred by Carrier and any other sums payable to Carrier, will be deemed fully earned, whether or not the Cargo is lost or damaged, or fails to arrive at the destination specified in the contract of Carriage. All such charges, sums and advances will be due and payable upon receipt of the Cargo by the Carrier, except that they may be collected by Carrier at any stage of the service performed under the contract of Carriage.

It followed from the agreement that the deadline for handing over goods to L at the airport in Hong Kong was 48 hours prior to departure:

Delivery [S] will deliver cargo . . . at HKG AIRPORT. Commodity is hand sanitizer, DGR UN 1987 Latest Acceptance Time according to . . . requirements (which is currently 48 hours before departure).

The hand sanitizer was handed to L at the airport on 2 May 2020 at 21:00. L accepted part of the shipment as "ready for carriage" on 3 May 2020 at 00:06.

The non-dangerous goods – the textiles – were handed over to L at the airport on 3 May 2020 at 00:13 and 00:16 and were accepted as "ready for carriage" on 3 May 2020 at 01:08.

The flight departed on 3 May 2020 at 9:43. However, 35.1 cubic meters of textiles were not on board the plane, so it departed without being entirely full. According to the airline, this was because there had been no time to carry out the necessary actions at the airport to load the goods on board before departure at 9:43 due to the late delivery of the goods.

On this basis, the freight forwarder made a claim to L for 532,000 Danish krone in reimbursement for the part of the goods that was not on board the flight. The freight forwarder held, among other things, that:

  • it was not clear that there had been practical challenges in managing to load the plane on 3 May 2020. L had accepted the goods as delivered and not rejected them as delivered too late;
  • it was therefore L's fault that 35.1 cubic meters of cargo were not on board the plane; and
  • L was therefore not entitled to freight for these goods. S should have a proportional discount in the freight of 31.34%.

The airline rejected the claim, holding that:

  • L was entitled to full freight, regardless of why the 35.2 cubic meters of goods were not transported;
  • it was S's fault that the goods had not been loaded on board, as they had been handed in at the airport later than 48 hours before departure, as required by the agreement and the procedure at the airport; and
  • the fact that the goods had been accepted as ready for transport did not imply that the goods would thereby be loaded on board, given that they had been accepted as ready for loading too late.

Decision

The Maritime and Commercial Court came to the conclusion that there was no basis for awarding S a reimbursement of the agreed freight.(1) The Court stated, among other things, that:

The court finds. . . that the carrier – in this case [L] – obtains the right to payment for the transport when the carrier has received the goods. The question of [L's] right to receive payment for the transport must, however, be assessed in the light of whether [L] . . . is wholly or partly to blame for the fact that all the goods was not carried with the plane at departure.

It follows from the parties' agreement that the delivery deadline for goods . . . was 48 hours before departure. After the evidence, including the explanations . . . the court assumes that the parties were aware that according to local regulations in Hong Kong for the transport of dangerous goods, a rule applied that such goods had to be handed in no earlier than 24 hours before departure. The agreement on delivery 48 hours before flight departure had thus been deviated from as far as the dangerous goods were concerned . . . .

Based on the above, the court assumes that the timely delivery deadline for the non-dangerous goods was 48 hours before departure. After the evidence, the court assumes that the non-dangerous goods were received . . . on 3 May 2020 at 00:13 and 00:16, i.e. about 10 hours before the scheduled departure at 10:20. The goods were thus delivered too late as per the parties' agreement, and [S] could therefore not expect that the goods would be loaded on board the plane. As It is thus due to [S'] circumstances that part of the non-dangerous goods was not transported on the departure on 3 May 2020, the court finds that L is not obliged to reimburse any freight.

Comment

In the judgment, the Court considered whether a provision that freight must be considered earned, regardless of whether the goods are not delivered at the destination, must be understood as meaning that the carrier is entitled to freight, regardless of the reason for the non-delivery.

The Court ruled that the provision must be understood as meaning that it is a condition for freight to be earned where the transport is not carried out because of a fault of the customer. This is in accordance with a general rule that the transport customer is responsible for the carrier's loss as a result of the goods not being delivered by the customer for transport in accordance with the agreement with the carrier.

The Court further found that:

  • it was the customer's fault that the transport of the goods had not been carried out on 3 May 2020, as the customer had handed in the goods too late; and
  • the fact that the goods had not been "accepted as "ready for carriage" did not imply that the goods could be considered delivered on time to L.

For further information on this topic please contact Jesper Windahl at WSCO Advokatpartnerselskab by telephone (+45 3525 3800) or email ([email protected]). The WSCO Advokatpartnerselskab website can be accessed at www.wsco.dk.

Endnotes

(1) BS-6416/2021-SHR.