British American Tobacco Switzerland SA & Ors v Exel Europe Ltd & Ors

[2012] EWHC 694 (Comm)

Summary

Under Article 31.1 of the CMR, a claimant must establish a jurisdictional connection in respect of each defendant sued. Article 36 identifies the carriers who may be liable, but does not create a jurisdiction to sue them all where only one carrier satisfies Article 31.1(a). Article 39.2, which expressly permits all carriers to be joined in proceedings between carriers, cannot be used to enlarge Article 31.1.

A successive carrier becomes party to the CMR contract under the terms of the consignment note. An exclusive jurisdiction clause binds that carrier only if it agreed to the clause, ordinarily through the consignment note. The CMR jurisdiction code sufficiently addresses the risk of multiple proceedings and does not require supplementation by the Brussels I Regulation.

Factual background

The claimants, companies in the British American Tobacco group, brought proceedings in England against Exel Europe Ltd and Dutch subcontracting carriers concerning losses of tobacco consignments carried by road across Europe. The contracts between BAT and Exel, and between Exel and the subcontractors, contained English jurisdiction clauses. The subcontractors were served in the Netherlands.

The subcontractors applied to set aside service, contending that the English court lacked jurisdiction under Article 31.1 of the CMR. The central issues were whether Article 34 and Article 36 permitted all successive carriers to be sued in the jurisdiction available against one carrier, whether a branch or agency of the first carrier could found jurisdiction against a subcontractor, and whether the Brussels I Regulation supplied any wider jurisdiction.

Held

  1. Applications granted. The service of the claim forms on Essers and Kazemier was set aside. Costs were to follow the event, subject to any special features raised by the parties.

  2. Article 31.1 restricts the courts in which a claim may be brought against each defendant. Article 36 permits a goods owner to sue the first carrier, the last carrier or the carrier performing the relevant part of the carriage, and permits those carriers to be sued at the same time. It says nothing about the court in which they may all be sued. The requirements of Article 31.1 therefore remain applicable to each defendant.

  3. The contrast with Article 39.2 is decisive. Article 39.2 expressly allows a carrier pursuing recovery proceedings to sue all concerned carriers in the country where any one of them is domiciled or has its principal place of business. The absence of equivalent wording in Article 31.1 prevents that provision being construed by reference to Article 39.2.

  4. Under Article 31.1(a), the relevant branch or agency is that of the defendant against whom jurisdiction is invoked. The relevant contract of carriage is the contract to which that defendant is party, namely the subcontract with the earlier carrier. The English office of Exel could not found jurisdiction against Essers or Kazemier.

  5. Under Article 34, successive carriers become parties to the statutory CMR contract under the terms of the consignment note. An exclusive jurisdiction clause binds a successive carrier only where it is included in the consignment note, or the carrier otherwise agreed to it. A carrier cannot be bound by a jurisdiction clause to which it did not consent and of which it had no notice.

  6. The CMR does not conflict with the principles underlying the Brussels I Regulation. Article 31.1(b) provides a jurisdiction in the place where the goods were taken over or designated for delivery, where all relevant carriers may be joined. A claimant choosing to sue one carrier in England under Article 31.1(a) cannot complain that other carriers cannot be joined there.

The court’s approach to earlier authorities

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Appellate history

Not stated in the judgment.

Appeal route

  1. This judgment [2012] EWHC 694 (Comm) High Court (Commercial Court)
  2. Appealed to[2013] EWCA Civ 1319Outcomeappeals allowed; english jurisdiction declared over claims against essers and kazemier
  3. Appealed to[2015] UKSC 65Outcomeappeals allowed unanimously; first-instance orders setting aside service restored

Key cases cited

7 authorities cited.

  • Hatzl & Anor v XL Insurance Company Ltd [2009] EWCA Civ 223
  • TNT Express Nederland v AXA Versicherung [2010] ECR I-4107
  • SONY COMPUTER ENTERTAINMENT LTD v RH FREIGHT SERVICES LTD AND OTHERS [2007] 2 Lloyd's Rep 463
  • FRANS MAAS LOGISTICS (U.K.) LTD. v. CDR TRUCKING B.V. [1999] 2 Lloyd's Rep 179
  • The Maciej Rataj [1994] ECR I-5439
  • ITT SCHAUB-LORENZ VERTRIEBSGESELLSCHAFT m.b.H. AND OTHERS v. BIRKART JOHANN INTERNATIONALE SPEDITION G.m.b.H. & CO. K.G. AND OTHERS [1988] 1 Lloyd's Rep 487
  • CUMMINS ENGINE CO. LTD. v. DAVIS FREIGHT FORWARDING (HULL) LTD., CHARTERWAY SHIPPING B.V., R.C.A. VAN DER GRAAF AND D. BOERS B.V. [1981] 2 Lloyd's Rep 402

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