Cargo owners have under the CMR the ability to sue a party they have contracted with to carry their cargo in the jurisdiction chosen by the parties in the contract of carriage. A recent Court of Appeal decision has clarified the jurisdictional question as to where the owner can sue the successive carrier.
In the three cases of British American Tobacco Switzerland S.A. and others v Exel Europe Ltd and H Essers Security Logistics B.V. and others, British American Tobacco Denmark A/S and Others v Exel Europe Ltd,and Kazemier Transport B.V.  EWCA Civ 1319, the Claimants, British American Tobacco Switzerland and British American Tobacco Denmark, had contracted with Exel to carry cargoes of tobacco across Europe by road.
The CMR applied to the contracts between the Claimants and Exel and provided that the agreement would be subject to English law with the jurisdiction of the English High Court.
Exel subcontracted the carriage journeys to other carriers.
In two of the carriages, consignments were stolen while in the custody of the subcontractors.
Under the contract with Exel, the Claimants brought proceedings in the English High Court against Exel and the two sets of subcontractors. Exel accepted proceedings, but both of the subcontractors challenged jurisdiction on the basis of Article 31 of the CMR, which stated that a claimant may bring an action in the jurisdiction agreed between the parties of:
- the country where the defendant is based; or
- the country where the goods were taken over by the carrier or the place designated for delivery.
At first instance in the Commercial Court, the subcontractors’ challenge on jurisdiction was upheld.
The Claimants appealed. Their appeal was based on two arguments. The first argument was that Article 31 has to be read in conjunction with Article 36, which states that a claim could only be brought against the primary carrier, the last carrier, and/or the carrier who was performing the contract at the time of loss and that “an action may be brought at the same time against several of these carriers”.
The Claimants argued that where jurisdiction had been established over one of the carriers, then the claim against the other could be brought at the same time and the same place.
The second argument was that the CMR should be read in conjunction with the European “Judgment Regulation” which included the principle that dual proceedings in more than one European jurisdiction should be avoided.
The Court of Appeal agreed with both these arguments.
With regard to the first argument, the Court of Appeal held that the CMR should be read as a whole rather than concentrating on single Articles. The Court of Appeal noted that the idea of “successive carriers” was not dealt with in the CMR until Article 34 onwards. Therefore, as Article 31 was silent on the idea of “successive carriers”, then the later Articles had to be taken into account when deciding on the jurisdictional issues surrounding suing “successive carriers”. The later Articles allowed carriers to sue multiple other carriers once they have established jurisdiction over one of the carriers; therefore, a cargo owner should have the same ability.
Looking at the second argument, the Court of Appeal held that where any conflict existed between the CMR and the “Judgment Regulation”, the “Judgment Regulation” took precedent.
Based on the above, the Court of Appeal found that the cargo owner should be able to sue multiple carriers under the CMR in any place where the cargo owner could establish jurisdiction. As the express agreement between the cargo owner and the primary carrier was that claims would be dealt with under English Law in the English High Court, then the claims against all the carriers could be heard in England.
This does seem the correct decision in clarifying the apparent conflict between Article 31 and the later Articles. All specialist conventions, including the CMR, should be read with the Judgment Regulation in mind, and there are clear benefits for cargo owners and carriers alike in keeping all claims within the same jurisdiction and having them dealt with at the same time.
This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.