Under the Convention on the Contract for the International Carriage of Goods by Road (CMR) carriers shall be free to agree among themselves on provisions other than those laid down in article 37 (contribution: recovery of compensation from the other carriers who have taken part in the carriage) and article 38 (suit: division of the share of the compensation due by an insolvent carrier) but any stipulation which would directly or indirectly derogate from the provisions of the CMR shall be null and void (article 41). Article 41.1 provides that: “Any stipulations which would directly or indirectly derogate from the provisions of this Convention shall be null and void. The nullity of such a stipulation shall not involve the nullity of other provisions of the contract.”

International carriage of goods by road under CMR. The application of articles 41 and 29 CMR in the light of the contractual clause “And the parties agree that breach of one or more of the contractor’s obligations and/or failure to take one or more precautions set out in hereinbefore amounts to recklessness with knowledge that damage will probably result as envisaged in article 29 CMR” is null and void pursuant to article 41 CMR.  

When the conditions prescribed by article 29 CMR are fulfilled the carrier will be deprived of the protection of the provisions excluding or restricting the carrier’s liability. Since the Supreme Court of the Netherlands held that in accordance with the laws of the Netherlands the equivalent of wilful misconduct it comes down to subjective conscious recklessness, which is nearly equivalent to intent[1], very few cargo interests have been able to succeed in bringing forward sufficient proof to defeat the carrier’s reliance on the protective provisions of the CMR. It is generally accepted that the purpose of the reference to the lex fori in article 29 means that it is left to the national law to determine what degree of default, not being wilful misconduct can be placed on the same footing as wilful misconduct as far as the legal consequences are concerned.

In a case recently decided by the Rotterdam District Court[2] the court was seized to decide on the validity of the following clause in a Framework Agreement entered into between Kleijn Transport and “K” Line (Nederland)/Kawasaki in 2002:

A. The parties have considered the increasing threat posed by organised and incidental crime and how to best protect their interests (and the interests of cargo involved) against theft and/ or misappropriation and they have agreed on the following:

1. Taking receipt of the cargo

(…)

2. Interruption of the transport

a) It is not permitted for the cargo to be left ‘standing over’ without express consent by “K” Line;

(…)

3. Security provision to the container/ lorry/ combination

In addition the combination carrying the goods is to be equipped

a) with proper theft resistant door-locks, contact lock and ‘Kingpin lock’

(…)

4. Delivery/ Delay

(...)

5. Instructions

a) The contractor/ his subcontractor(s) / further subcontractors/drivers are to follow the above (…) in full and at all times;

(...)

B.  Consequences : 

1. The parties are of the opinion that, with and because of the current scale, frequency,  penetration and at times degree of organisation of organised and incidental crime (and bearing in mind the preponderantly high value cargo involved) the above are essential precautions in an effort to prevent theft and/or misappropriation of goods carried.

2. And the parties agree that breach of one or more of the contractor’s obligations and or failure to take one or more precautions set out herein before amounts to recklessness with knowledge that damage will probably result as envisaged in art. 29 CMR.

Obviously the parties to the Framework Agreement by incorporating this clause intended to precisely define the circumstances which would prevent the carrier Kleijn Transport from invoking the clauses excluding or restricting the carrier’s liability. The effect of article 41.1 CMR is that, with regard to matters regulated by the CMR, the terms of the contract of carriage are fixed, except for a few changes allowed by the CMR concerning, for example, contribution and suit. The carrier’s liability under the CMR may not be reduced or limited, for example, to the amount of the carrier’s liability cover.

The Rotterdam District Court held that the contractual stipulation that the carrier’s failure to (properly) take the contractually prescribed security measures will automatically, regardless of all circumstances specific to the case, amount to “recklessness knowing that damage will probably result”, and therefore such default on the part of the carrier is considered as equivalent to wilful misconduct as required by article 29 CMR, derogates from the regime laid down in the CMR. In particular from the manner in which the CMR divides the burden of proof. The provision in the Framework Agreement exchanges the acting person’s or parties’ subjective awareness of the risk of loss or damage for a contractual fiction. Thus, (i) the criterion of subjective awareness is abandoned, (ii) it is agreed in advance and without establishing the facts of the case that the chance that the risk will materialise is substantially larger than the chance that it will not, and (iii) the burden of proof on the counter part of the carrier is alleviated and the carrier is even precluded from submitting counter evidence. The court held this contravenes the uniform application of the carrier’s liability regime envisaged in the CMR.

The plaintiff was held liable and was ordered to pay the damages to the defendants in accordance with the limitation contained in article 23 CMR (8,33 SDR/kg gross weight).