Those involved in the air freight industry will be familiar with shock watches. According to the manufacturers of these devices, shock watches are designed to protect products from impact and tilting. They may also provide evidence to support a damage claim by the cargo owner/shipper. In practice, however, their use may be of more limited value. Following a recent judgment handed down by the Seoul Central District Court, if the only proof of damage is the activation of a shock watch, this alone may not be sufficient to guarantee a successful claim against the carrier.
The case in question involved the carriage by air from San Francisco to Incheon, South Korea, of five crates of medical equipment. Upon arrival into Incheon, and during segregation of the cargo, a shock watch stacked on one crate was found discoloured and a shock watch which had been stacked on a second crate was found to be missing. A survey report procured by the Claimants concluded that the cause of the damage was due to a ‘hidden impact’ during the carrier’s custody. Photographs of the consignment in question showed no obvious signs of physical damage to the outer packaging of the crates, yet upon testing, the machinery within was found damaged and no longer functioning. A claim was brought against the carrier by the subrogated Insurers for the House Air Waybill consignees seeking to recover their outlay for the damaged consignment.
Based on carriage USA to South Korea, the carrier’s liability was governed by the provisions of the Montreal Convention 1999 (the Montreal Convention). Article 18(1) of the Montreal Convention provides that “the carrier is liable for damage sustained in the event of...damage to, cargo upon condition only that the event which caused the damage so sustained took place during the carriage by air”. In its defence, the carrier argued defective packaging (available under Article 18 (a) and (b)) since the cargo was found to have no shock absorbers or support. The carrier also argued that the mere fact that one shock watch was missing and one had been activated was not sufficient evidence that the damage had been caused during carriage by air. There was also no proof that the alleged missing shock watch was actually attached to the cargo on uplift at San Francisco. Informal tests carried out on the shock watches by the carrier (the results of which were presented to the Court) indicated that the shock watch used in respect of the consignment in question was also overly sensitive.
In the written decision, the Judge accepted that the claim should be adjudicated in accordance with the provisions of the Montreal Convention. He also held:
- That the burden of proof was on the Claimant to establish that the cargo in question had sustained damage during the course of carriage by air and that the Claimants had not discharged that burden of proof.
- The shock watch used was not appropriate for the weight/volume of the subject cargo.
- No prior notice had been given to the carrier that shock watches had been attached to the cargo (or that the cargo was sensitive to shock or tilting), and nor had any additional charge been paid for handling the cargo on the basis it was sensitive to impact.
In short, the Judge concluded that the mere fact that the shock watch had discoloured was not sufficient evidence of an external impact causing damage to the cargo during the carriage by air.
The Judge’s analysis is positive news for carriers defending similar claims, as it underlines the fact that the simple activation of a shock watch may not, on its own, be sufficient to mount a successful case against the carrier. Although, for commercial reasons, most claims of this nature will never reach the courts (particularly if the Montreal Convention applies, as liability limits are unbreakable), carriers may be more willing to consider mounting a defence to such claims, particularly if the claim value warrants it and the carrier/its Insurers have the appetite to defend.