Arnold Van Steenderen, Van Steenderen Mainport Lawyers, Rotterdam

1. Ref: Ceva Freight LLC et al vs. China Airlines, Court of North Holland, Judgment of 4 December 2019. 

The facts

2.1.  Ceva is a (part of) a globally operating logistic service provider, active among others at Schiphol Airport ( Amsterdam).

2.2.  China Airlines is an internationally operating airline.

2.3.  At Schiphol, Menzies performs the role of ground handler Menzies business is consisting of unloading consignments from vehicles, taking temporary custody of consignments from its warehouse and ultimately handing them over to consignees under contracts of carriage entered into by the air carriers in respect of those consignments. However, it also acts as a supplier of consignments under the so-called ‘Milkrun project’ to a number of logistics service providers, including Ceva, which operate at Amsterdam Airport Schiphol. This does not take place under the transport contract, but under a separate direct agreement between Menzies and the relevant logistics provider. The airline is not a party to this agreement.

2.4.  Under an air transport agreement with Ceva, China Airlines has received a shipment consisting of 527 packages with a total weight of 8,133 kg. The shipment included Western Digital branded hard disk drives.

2.5.  For transport, China Airlines issued a Master Air Waybill (hereinafter MAWB) No. 297-6232-1836. The MAWB shows that China Airlines will transport the shipment from Hong Kong to Amsterdam via Taipei and Frankfurt.

2.6.  At the final leg of this carriage the 527 packages were transported from Frankfurt to Schiphol by road in a sealed truck to the premises of Menzies.

2.7.  Menzies signed off the road carrier’s ‘Cargo manifest’ on 25 September 2016, listing the 527 packages. Menzies also signed the CMR International Consignment Note drawn up by the road haulier for the 527 packages. On this CMR waybill the note was made that 35 packages were damaged. Furthermore, on 27 September 2016 at 4.46 p.m. Menzies registered the 527 packages in its own “Cargo manifest”.

2.8.  On 27 September 2016 at 9.53 p.m. Menzies then drew up a “Milkrun Manifest” for the transport of 527 packages weighing 8,133 kg by road carrier Bos Logistics Schiphol B.V. The document was signed by “Handler” [A.]. The document was received and with pen the remark “523¢. (4¢ defect)” was made.

2.9.  Menzies released the goods on 27 September 2016 at 9.57 p.m. and printed out an outbound receipt for 527 packages. At the bottom of the receipt the word MILKRUN is printed. Menzies also reported the 527 packages to customs on behalf of Ceva. Above the entry it says “SHIPMENT IS CUSTOMS CLEARED IN FULL 527 PCS”.

2.10. Ceva found that 4 of the 527 packages, consisting of 2240 Western Digital branded hard disk drives with a gross weight of 1,588 kg, were missing. The invoice value of these hard disks is USD 176 789,60.

2.11. On 16 October 2016 Ceva reported a ‘Shortage/Loss’ to China Airlines in a preliminary notice of claim.

2.12. Ceva settled the case with cargo interested Western Digital Technologies for an amount of USD 71,550.

The dispute

3.1.  Ceva claims that China Airlines should be ordered to pay SDR 30 172, converted into Euros, together with interest at the statutory rate, extra-judicial costs and legal costs, including post-clearance costs.

3.2.  Ceva bases its claim – in summary – on the fact that, of the 527 packages received under the air transport agreement with China Airlines, only 523 were delivered by China Airlines. This represents a loss of 4 packages. Ceva contends that it has suffered loss as a result and China Airlines under Article 18(1) and (3) of the Montreal Convention (Convention for the Unification of Certain Rules for International Carriage by Air, Montreal 28 May 1999, hereinafter referred to as ‘the Convention’) is liable for such damage because it did not deliver the goods in the same condition in which it received them and the loss of the packages occurred while the shipment was in the custody of China Airlines.

China Airlines’ liability is limited to 19 Special Drawing Rights (hereinafter: SDR) per gross kilogram of weight on the basis of article 21 paragraph 3 of the Convention. The amount for which China Airlines is liable is therefore 30,172 SDRs, according to Ceva.

3.3.  China Airlines puts forward a defense. It disputes – in summary – that China Airlines is liable under Article 18 of the Convention, since Ceva has not demonstrated that there was a loss of 4 hard disk packages and that this loss occurred during the period of air transport.

In addition, it disputes that Ceva has complied with the duty to protest under art. 31 Convention. Finally, it contests the quantum of the damage.

3.4.  The parties’ claims will be discussed in more detail below in so far as they are relevant.

The assessment

4.1.  By virtue of article 18 paragraph 1 of the Convention, the carrier is liable for damage sustained in case of destruction, loss or damage to goods, on the sole ground that the event which caused the damage took place in the course of the carriage by air. By virtue of article 18 paragraph 3 of the Convention, the carriage by air includes the period during which the cargo is in the charge of the carrier. Ceva must therefore prove that the loss of the 4 packages is the result of an event which occurred during the period in which the consignment was in the custody of China Airlines.

4.2.  In this case the court concurs with China Airlines, that this has not been proved. Indeed, the documents signed and drawn up by Menzies from the arrival of the sealed lorry (of which it has not been claimed or shown that the seal of the lorry had been broken) until the Menzies removal order of 27 September 2016 at 9.57 p.m. show that the consignment of 527 packages was received and handed over to Ceva. There is no mention of missing packages anywhere in these documents. The 527 packages were registered in Menzies’ own ‘Cargo manifest’ and Menzies reported 527 packages to customs on behalf of Ceva. Subsequently, on 27 September 2016 at 9.57 p.m. Menzies released the goods and printed a removal order for 527 packages.

That on the “Manifesto Milkrun” with pen “523¢. (4¢ defect)” is written, doesn’t make it any different. What can be disputed about this remark by Ceva is that this document refers to the delivery service to logistics service providers (the so-called Milkrun) organised by Menzies and is only important in the mutual relationship between Ceva, Menzies and road haulier Bos Logistics B.V., and therefore plays no role in the relationship between China Airlines and Ceva.

Also the pictures and screenshots of security images submitted by Ceva do not lead to a different judgement, since it is in no way possible to deduce which consignment this concerns. The statements made by S. el Hadouchi and T. Man also do not make it sufficiently clear when and how the absence of four packages was discovered by Ceva.

4.3.  It follows from the above that Ceva’s claims must be rejected. The remaining defenses of China Airlines therefore no longer need to be discussed.

4.4.  Ceva will be ordered to pay the costs of the proceedings as the unsuccessful party. The costs on the part of China Airlines are estimated at: etcetera.

The decision

The court:

5.1.  rejects the claims,

5.2.  orders Ceva to pay the costs of the proceedings, which China Airlines has so far estimated at €3,382,

5.3.  orders Ceva to pay the costs incurred following this judgment.

5.4.  declares this judgment immediately enforceable as regards the award of costs.