England and Wales Court of Appeal (Civil Division) Decisions

Quantum Corporation Inc. & Ors v Plane Trucking Ltd. & Anor [2002] EWCA Civ 350 (27th March, 2002)

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL ( DIVISION) ON APPEAL
FROM THE QUEEN’S BENCH DIVISION
COMMERCIAL COURT (TOMLINSON J.)

		Royal Courts of Justice Strand, London, WC2A 2LL
		27 March 2002

Lord Justice Mance:

Introduction

1. This appeal raises a point of principle regarding the applicability of the CMR Convention (“CMR”), scheduled to the Carriage of Goods by Road Act 1965, in circumstances where a contract embraces more than one type of carriage. Tomlinson J concluded that the correct approach was to characterise the contract as a whole, and that, unless the contract as a whole could be said to be for carriage by road internationally, any road carriage which it embraced fell outside the terms of the Convention. He gave permission to appeal, because of the general importance of the point.
2. The dispute arises between the four claimants/appellants and the second defendants, Air France. The four claimants are Quantum Corporation Inc., a Californian corporation, Quantum Peripheral Products (Ireland) Ltd. of Eire (“Quantum Ireland”), Expeditors (S) Pte Ltd. of Singapore (“Expeditors Singapore”) and Expeditors Sea Sky (Dublin) Ltd. of Eire (“Expeditors Ireland”). The last two companies were freight forwarders. The claim relates to the loss in transit between Singapore and Dublin of a consignment of 11,520 hard disks. Expeditors Singapore on 21^st September 1998 issued its own house air waybill no. 4710119916 naming Quantum Asia Pacific Pte Ltd. as consignor and Quantum Ireland as consignee. For the purposes of the actual carriage, it consolidated the consignment with another (apparently also consisting of computer parts originating with one or other Quantum company), and, as agent for Air France, also issued a master air waybill no. 057-52326621 on 21^st September 1998 naming itself as consignor and Expeditors Ireland as consignee.
3. Air France had no direct flight from Singapore to Dublin. The master air waybill thus recorded that the goods were to be carried in two stages. The first was to be from Singapore to Charles de Gaulle airport, Roissy, Paris by Air France, and the second (from there) to Dublin by Air France. Two corresponding entries appeared in a further box, each under a heading “Flight/Date”, namely “AF6753/22” and “AF9408/22”. It is common ground that these identify, firstly, an Air France flight from Singapore to Charles de Gaulle in France, and secondly a trucking service used by Air France to carry goods from Charles de Gaulle to Dublin airport, followed in each case by the date of intended carriage thereby (22^nd, that is of September 1998). The present consignment was one of a large number of similar consignments involving the same parties which had been carried in the same way, daily or almost so, during 1998. Its carriage by road on a roll-on, roll-off basis from Charles de Gaulle to Dublin was sub-contracted by Air France to the first defendant, Plane Trucking, now insolvent. The consignment of hard disks (alleged to have been worth some US $1.5 million) was lost in North Wales by a pretended “hi-jack” in which the truck driver and one of Plane Trucking’s supervisors were involved as conspirators - each pleaded guilty and each has been sentenced to three years and nine months imprisonment.
4. The application before Tomlinson J was for judgment under Part 24 for damages to be assessed against both defendants. Although Air France’s pleadings had raised issues as to which claimant had any claim, counsel’s skeleton before the judge acknowledged that “Air France’s liability to the Claimant [sic] is not in issue”. The (limited) judgment that the judge gave was in favour of the claimants/appellants generally, and it has not been suggested before us that this was wrong. Counsel’s skeleton before the judge went on to identify as fundamental issues (a) whether the CMR Convention applied to the trucking leg from Charles de Gaulle to Dublin and (b) if so, whether the circumstances of the theft were such as to amount to wilful default within the meaning of CMR (cf article 29). We are only concerned with the former issue. If the second arises, it has been agreed to refer it back to the Commercial Court for resolution.
5. Under article 17 of CMR, a carrier is liable for total or partial loss occurring between the time he takes over the goods and the time of delivery, the only relevant exception for present purposes being if the loss was caused “through circumstances which the carrier could not avoid and the consequences of which he was unable to prevent”. Article 23(3) limits compensation to 8.33 units of account per kilogram of gross weight short. But, if the damage was caused by wilful default - by the international road carrier or by its servants or agents or any other persons of whose services it makes use for the performance of the carriage – article 29 prevents the carrier from limiting its liability.
6. Air France’s case, which the judge accepted, is that carriage by air subject to the Warsaw Convention ended at Charles de Gaulle, and that its liability thereafter fell to be measured by reference to its own terms and conditions, to which reference was made on the air waybill. Those conditions limited any liability on Air France’s part to 17 Special Drawing Rights per kilogramme of cargo lost – a more generous limit than the basic CMR limit. However, in respect of carriage not subject to the Warsaw Convention in any of its variants, they contained less favourable provisions regarding the standard and onus of proof of liability and, more importantly, no provision paralleling article 29 of CMR or disentitling Air France from relying on the limit of 17 Drawing Rights in the event of wilful default.
7. More specifically, Air France’s conditions provided as follows:

ARTICLE 1 –DEFINITIONS

“1.3 Applicable Convention: means whichever of the following instruments is applicable to the contract of carriage; [there followed a list consisting of the Warsaw Convention and four of its variants]” ….

ARTICLE 2 – APPLICABILITY

2.1 General:

These Conditions shall apply to all carriage of cargo, including all services incidental thereto, performed by or on behalf of Carrier; provided however that if such carriage is “international carriage” as defined in the applicable Convention (see Article 1: Definitions, under “Applicable Convention”) such carriage shall be subject to the provisions of the applicable Convention and to these Conditions to the extent that these Conditions are not inconsistent with the provisions of the Convention.”

“ARTICLE 11 – CARRIER’S LIABILITY

11.1 Carrier is liable to the shipper, consignee or any other person for damage sustained in the event of destruction or loss of, or damage to, or delay in the carriage of cargo only if the occurrence which caused the damage so sustained took place during the carriage by air. For the purposes of this Article carriage by air shall comprise the period during which the cargo is in the charge of the carrier, or in the charge or its agent.

11.2 Except as may be otherwise provided in any applicable Convention, Carrier is not liable to the shipper, consignee or any other person for any damage, delay or loss of whatsoever nature arising out of or in connection with the carriage of cargo or other services performed by the Carrier, unless such damage, delay or loss is proved to have been caused by the negligence or wilful default of Carrier and there has been no contributory negligence on the part of the shipper, consignee or other claimant ….

….

11.7 Unless the carrier has made a special declaration of value for carriage and has paid the supplementary sum applicable, liability of Carrier shall not exceed the applicable Convention limit or, if no Convention applies, 17 Special Drawing Rights, per kilogramme of cargo destroyed, lost, damaged or delayed. …”

8. Articles 11.1, 11.2 and 11.7 are thus relied upon by Air France in this case to limit their liability to 17 Special Drawing Rights per kilogramme. The practical effect is to restrict it in this case to £116,057.56, for which sum the judge gave judgment against Air France.
9. S.1 of the 1965 Act provides that the provisions of CMR “shall have the force of law so far as they relate to the rights and liabilities of persons concerned in the carriage of goods by road under a contract to which the Convention applies”. Chapter I of the Convention, consisting of articles 1 and 2, is entitled “Scope of Application”. It provides as follows:

“Article 1

1. This Convention shall apply to every contract for the carriage of goods by road in vehicles for reward, when the place of taking over of the goods and the place designated for delivery, as specified in the contract, are situated in two different countries, of which at least one is a Contracting country, irrespective of the place of residence and the nationality of the parties.

2. For the purposes of this Convention, “vehicles” means motor vehicles, articulated vehicles, trailers and semi-trailers as defined in article 4 of the Convention on Road Traffic dated 19^th September 1949.

3. This Convention shall apply also where carriage coming within its scope is carried out by States or by governmental institutions or organisations.

4. This Convention shall not apply:

(a) to carriage performed under the terms of any international postal convention;

(b) to funeral consignments;

(c) to furniture removal.

5. The Contracting Parties agree not to vary any of the provisions of this Convention by special agreements between two or more of them, except to make it inapplicable to their frontier traffic or to authorise the use in transport operations entirely confined to their territory of consignment notes representing a title to the goods.

Article 2

1. Where the vehicle containing the goods is carried over part of the journey by sea, rail, inland waterways or air, and, except where the provisions of article 14 are applicable, the goods are not unloaded from the vehicle, this Convention shall nevertheless apply to the whole of the carriage. Provided that to the extent that it is proved that any loss, damage or delay in delivery of the goods which occurs during the carriage by the other means of transport was not caused by an act or omission of the carrier by road, but by some event which could only have occurred in the course of and by reason of the carriage by that other means of transport, the liability of the carrier by road shall be determined not by this Convention but in the manner in which the liability of the carrier by the other means of transport would have been determined if a contract for the carriage of the goods alone had been made by the sender with the carrier by the other means of transport in accordance with the conditions prescribed by law for the carriage of goods by that means of transport. If, however, there are no such prescribed conditions, the liability of the carrier by road shall be determined by this Convention.

2. If the carrier by road is also himself the carrier by the other means of transport, his liability shall also be determined in accordance with the provisions of paragraph 1 of this article, but as if, in his capacities as carrier by road and as carrier by the other means of transport, he were two separate persons.”

10. The basic issue that we have to address is, therefore, what constitutes a “contract for the carriage of goods by road in vehicles for reward” within the meaning of article 1(1). In addressing it, it is necessary to bear in mind the geographical pre-condition to the application of CMR which article 1(1) also introduces, namely that “the place of taking over of the goods and the place designated for delivery, as specified in the contract, are situated in two different countries”, of which at least one is a Contracting country. The appellants’ case is simply and solely that, although there was only one contract, by it Air France contracted, firstly, for the carriage of goods by air to Charles de Gaulle and thence, secondly, for their carriage by truck to Dublin.
11. The judge addressed the Part 24 application on the basis that, although carriage by road from Paris to Dublin was Air France’s intended mode of performance, “Air France was not contractually obliged to carry the goods in that manner, and might if they had so wished have carried the goods on that leg by air”. We can, it seems to me, proceed on the same assumption. The evidence given on the subject by Air France’s solicitor, Mr Rosen, was as follows:

“It is correct that the contract of carriage recorded that it was Air France’s intention to truck the goods between Paris and Dublin, having flown them from Singapore to Paris; and that such intention was notified to the Claimants or their agents. Both the “house” air waybill No. 4710119916 issued by Expeditors International (page 1 of “AJP 1”) and the air waybill No. 057-52326621 issued by Air France (page 3 of “AJP 1”) refer to flights AF6753/22 and AF9408/22. I am told by Mr. Humphries that the former is the number of the relevant flight from Singapore to Paris CDG, and the latter is the number of the relevant trucking service operated by Air France between Paris CDG and Manchester airport. However, although it was Air France’s intention to truck the goods from Paris CDG to Dublin, Air France contends that it was not contractually obliged to do so. Air France was contractually permitted to fly the goods on that leg if it had chosen to do so; see, for example, clause 6.3 of the Air France Conditions (page 53 of “AJP 5”).”

Clause 6.3 of Air France’s conditions provides:

“6.3.2 Carrier may without notice substitute alternate carriers or other means of carriage”.

12. Mr Rosen was thus accepting what seems to me the clear reality, that the contract recorded in the air waybill was for two legs, the first to be performed by air, the second a trucking leg – unless of course Air France elected to substitute some other means of transport in either case under clause 6.3.2. I add that condition 11.1 itself acknowledges the possibility that Air France might have goods in its possession for purposes other than carriage by air – otherwise there would have been no need for the expanded definition of what “carriage by air” should be taken to comprise for the purposes of that article. Here, the air waybill, by its description of the two contractual stages of transport, and by the identification of the second by its number as the trucking stage, expressly provided for the second stage to be by road. Before us, Mr McLaren said that Air France acknowledged that it was the intention or contemplation to carry by road from Paris to Dublin, and that it did not require the exercise of any option under clause 6.3.2 to do so, but submitted that the contract was for carriage by air to Paris and for carriage in any way that Air France liked from Paris to Dublin. There seems to me no basis for that submission. The position, as I have said, is that there was a contract providing for transport in two stages, one by air, the other by road. That the contract was reflected in an air waybill (a matter referred to in the respondents’ notice) does not affect this conclusion, when the air waybill itself records the two different stages.
13. For completeness, I add two points. First, the evidence shows that Quantum Ireland and Air France had in early 1998 communicated regarding, and on 13^th May 1998 met with Expeditors Ireland at this last company’s Dublin premises to discuss, the trucking leg and Quantum Ireland’s dissatisfaction with Plane Trucking. There is an issue whether Air France actually agreed to use other truckers, but, however that may be, this evidence confirms Mr Rosen’s statement that, unless some other option was chosen, the present contractual arrangement contemplated and provided for carriage by road. It does not support the unreal suggestion that Air France was during 1998 repeatedly contracting to carry by air from Paris to Dublin, but was on each occasion electing under clause 6.3.2 to change the means of carriage or Mr McLaren’s submission that the mode of carriage over this leg was simply open. Secondly, CMR governed Air France’s contract with Plane Trucking (although Air France also required Plane Trucking to accept increased liability, basically up to the Warsaw Convention limits which Air France undertook towards those using its services: cf condition 11.1 of Air France’s conditions above).

Analysis

14. Two questions present themselves when considering article 1. The first is to what extent the application of the Convention depends upon a carrier having obliged itself contractually to carry by road (and by no other means). This depends upon the force, in context, of the word “for” in the reference in article 1 of the Convention to a “contract for the carriage of goods by road”. The second is to what extent (if at all) a contract can be both for the carriage of goods by road, within article 1, and for some other means of carriage, to which CMR does not apply.
15. Taking the first question, attention can for a moment be confined to a simple contract for carriage from A to B, without any unloading from the trailer. There is a range of possibilities, each of which may actually lead to goods being carried by road internationally: Thus: (a) the carrier may have promised unconditionally to carry by road and on the trailer, (b) the carrier may have promised this, but reserved either a general or a limited option to elect for some other means of carriage for all or part of the way, (c) the carrier may have left the means of transport open, either entirely or as between a number of possibilities at least one of them being carriage by road, or (d) the carrier may have undertaken to carry by some other means, but reserved either a general or a limited option to carry by road.
16. In case (a), the contract is on any view “for” carriage by road within article 1. If one were to confine the application of article 1 to case (a), that would, probably, mean that there was a reasonably clear-cut distinction between cases where the Convention would and cases where it would not apply. However, I would not for my part regard that as at all a satisfactory or likely interpretation of article 1. Many, if not most, carriage contracts contain options as to alternative modes of performance, whether general or related to specific emergencies. In case (b), the contract was also “for” such carriage, unless and until the carrier elected otherwise under such an option, which it never did. The mere inclusion of an (uninvoked) option in such a contract cannot sensibly be decisive to the application of CMR. In case (c), the contract never promised, but it permitted and the carrier elected for carriage by road. There seems on the face of it good reason to treat such a contract as being a contract “for” - in the sense of “providing for” or “permitting” - the carriage of goods by road which actually occurred under its terms.
17. A further point is that, if the carrier had elected to carry internationally by air, there would have been no doubt about the application of the otherwise applicable Convention on air carriage. Although the trigger to the application of CMR is the contract for carriage by road, it seems to me desirable to interpret that phrase in a manner which dove-tails the application of the two regimes as far as possible.
18. Finally, there is case (d). This is the case in which the prospect of carriage by road was the most remote, as far as those interested in the goods and contracting for the carriage were concerned. A possible divergence of view about its treatment emerges in the continental authority to which I shall come. I start however with the initial impression that it would be difficult to draw any very clear or satisfactory distinction between case (d) and the previous cases. If they are all within CMR, there seems to me much to be said for treating case (d) as also within CMR. Carriage by road contrary to the terms of a contract would raise different considerations.
19. Air France emphasises that CMR, in contrast with for example the Warsaw Convention, focuses on “the contract for the carriage of goods by road”, and not on the carriage. So it does, although it is worth noting that the Warsaw Convention also contemplates an agreement: see in particular article 1(2) (whereby “the expression international carriage means any carriage in which, according to the agreement between the parties, ….”) and article 5(2) (whereby the absence, etc. of an air waybill “does not affect the existence or validity of the contract of carriage which shall …. be none the less governed by the rules of this Convention”); and see generally Fellowes (or Herd) v. Clyde Helicopters Ltd. [1997] AC 534 and Western Digital Corp. v. British Airways plc [2000] 2 Ll.R. 142, esp. paragraph 42 (“Whilst it is clear that in certain respects the Convention scheme provides general rules rather than merely statutory contractual terms, it is also clear that the draughtsmen had very much in mind as a premise to its application the existence of a relevant contract of carriage”).
20. The truism that CMR focuses on the contractual position does not answer the question: on what aspect of the contractual position and as at what date does it focus? Air France’s case appears to stand for this, that the application of CMR depends upon examining the contract terms at the first moment when the contract is entered into, and that the actual operation of the contract terms is irrelevant. In my judgment, there is attraction in an alternative approach, according to which the application of CMR depends upon the occurrence of international carriage of goods by road pursuant to contract. The (somewhat stilted) reference in article 1(1) to “the contract for the carriage of goods by road”, which must derive by literal translation from the original French version of the Convention, appears to me quite capable of being so read.
21. In this connection, I note that the rights and liabilities which the Convention regulates are those arising out of actual carriage by road under a contract to which the Convention applies (cf. not merely article 1 of CMR and section 1 of the 1965 Act, but all the detailed provisions of CMR). It is not surprising, in this light, that the Convention in a number of places even switches emphasis to carriage or “traffic” as the object of its application: see e.g. articles 2, 31(1) and 32 and the Protocol of Signature at its end. (Indeed, the language of article 2 positively suggests that the application of CMR to roll-on, roll-off carriage on an agreed sea, rail, inland waterway or air leg does not depend upon whether such roll-on, roll-off carriage was agreed from the outset, but upon whether it actually occurred under the contract.) Secondly, I note that article 4 provides that “the contract of carriage shall be confirmed by the making out of a consignment note”, that article 6 provides for a consignment note to contain a number of particulars which would commonly only be known once such actual carriage begins and that article 9 provides that “the consignment note shall be prima facie evidence of the making of the contract of carriage, [and] the conditions of the contract …..” (although by article 4 it is also provided that the absence or irregularity of the consignment note shall not affect the existence or validity of the contract of carriage). Far from focusing on any initial or previous contractual arrangement or any optional methods of carriage which it may have contained, these provisions contemplate that whether there is a contract for carriage and on what conditions can be determined by reference to a document which will necessarily reflect the reality that the contract has now become, by agreement or election, one for carriage by road. I see no difficulty therefore in concluding that the determination whether there exists a contract for the carriage of goods by road within article 1 should take into account the actual operation of the contract under its terms. Nor does this conclusion in my view involve any inadmissible circularity as suggested in the article, Combined Transport and the CMR Convention [1968] JBL 311, by P. F. Fitzpatrick (now Prof. Fitzpatrick of Birkbeck University) to which the judge referred. All it does is to adopt an appropriately larger perspective when making the relevant assessment.
22. The judge was right to state (paragraph 21 of his judgment) that “the purpose of the Convention was to standardise conditions under which international carriage by road is undertaken”. If express confirmation of this obvious object is necessary, it is also found in the preamble to the international convention. But standardisation would be incomplete and potentially capricious, if the application of CMR depended upon whether the carrier could be said to have contracted unconditionally and at the very outset to carry by road.
23. As I read paragraphs 18, 24 and 25 of his judgment, the judge did attach some significance to his conclusion that Air France was not contractually obliged to carry by road. It is not clear to me into which of cases (b), (c) and (d) he would have regarded Air France’s right to truck the goods over the Paris-Dublin leg as falling. In my view, and on the basis of the air waybill and Mr Rosen’s evidence, it fell within case (b). The judge’s own attention was, I think, focused on a different question, namely: once it was established that Air France had no absolute obligation to carry by road from Paris to Dublin, could the contract as a whole be characterised as one for carriage by road?
24. The judge considered that article 1 required any contract for carriage to be characterised as a whole. On this basis, the instant contract could not in his view properly be described as a contract for carriage of goods by road. It was in his view pre-dominantly for carriage by air. Underpinning his conclusion was, he said, the circumstance that the place of taking over could only be Singapore. But he added that, even if Air France could (implausibly, in his view) be treated as obliged to carry by road from Paris to Dublin, the contract would at most be a contract for carriage by both air and road, not a contract within article 1; and, even if that problem could be overcome, the only place of taking over could be Singapore, which would be “both absurd and contrary to the Warsaw Convention”.
25. It was in the judge’s view irrelevant to consider what might be the position under a reverse situation (for example, an initial trucking leg followed by air carriage). Even if, in such a case, the contract overall could be characterised as being for carriage by road (with the consequence, in the judge’s view, that CMR might apply to the road leg, although, by necessary inference from article 2, not to the air leg), that was not this case.
26. Before us, Mr McLaren for Air France advanced the test of overall characterisation only as a secondary case. His primary submission was that CMR only applies to a contract providing for carriage by road from start for finish, with the single exception being that contained in article 2. However, this submission would mean that a contract for carriage by road from Stockholm to Naples would be subject to CMR; that a contract for carriage from Stockholm to (say) Capri would also be subject to CMR, if the goods remained on their trailer for the short sea passage from Naples to Capri; but that no part of a contract for carriage by road from Stockholm to Naples and sea from Naples to Capri would be subject to CMR. Other, similar results can readily be envisaged, e.g. in respect of contracts for carriage from Spain to a Channel port in France or across the Channel into this country or from Eire to Marseilles (by roll-on, roll-off transport) with a possible final sea leg to Corsica.. I do not think that either the drafters of CMR or participants in the international carriage of goods would regard it as sensible that rights and responsibilities for the long international trucking legs in such cases should depend upon whether a carrier by road does or does not undertake the final sea leg, or, if it does undertake it, upon whether or not it transports the goods on their trailer during it.
27. Reference was made before us to a part of the Protocol not repeated in the schedule to the 1965 Act, providing that the signatories to the Convention “undertake to negotiate conventions covering contracts for …. combined carriage”. Mr McLaren suggested that this indicated that the signatories would have excluded the application of CMR to the international road leg of a carriage contract like the present. I do not agree that there is any such inference. I agree here with Prof. Fitzpatrick that “all the parties to CMR may be and probably are saying is that they undertake a Convention which will apply to a contract for combined transport as a whole, which Convention will go beyond the extent of agreement reached in article 2 and will supersede the various Conventions or national laws applying to each part”. A Convention covering combined or multimodal transport would, in other words, have addressed the thorny issue of the appropriate overall basis and single standard of liability for such transport, with the possibility that there might have to be different standards for different combinations of modes of transport. That endeavour has never been completed, if it has even been attempted. But that has no bearing on the present issue, which is whether CMR is potentially applicable to an international road leg of a larger carriage contract, as the Warsaw Convention is to the air leg.
28. Mr McLaren opened up the possibility of a “clash of conventions” if the Warsaw Convention could apply to air carriage while CMR applied to a prior or ensuing road carriage leg. This clash related to goods in an airport in the charge of the air carrier after it had also taken them over for road carriage, or possibly while he was completing road carriage. The point seems to me too esoteric in any event to serve as any reliable guide to the scope of article 1(1) of CMR. But, however that may be, I am confident that it could and would be resolved when it arose, either by recognising the difference in capacity in which the goods were held, or, if both Conventions really could apply at the same time, by recognising that nothing in either prevents the carrier from undertaking a higher responsibility (see article 41 of CMR and article 32 of the Warsaw Convention). As will appear, it has not as yet caused any problem or reported litigation in any of the jurisdictions accepting the application of CMR to international road carriage under a combined or multimodal contract.
29. The express provisions of article 2 make CMR applicable for the whole of the carriage, where the vehicle carrying the goods is carried over part of the journey by means other than road. It is possible to argue that the force of the word “nevertheless” is to suggest that, apart from article 2, the Convention would at least have applied to the international carriage by road. On the other hand, the word may have been introduced to point a contrast with a situation where no part of the Convention would otherwise apply. In my view, article 2 is not inconsistent with a view that article 1 can apply where a contract is in part for one form and in part for another form of carriage; on the other hand, it is not conclusive either way. I do, however, note that the drafters of article 2 found no difficulty in speaking throughout of “the carrier by road”, when describing that aspect of the functions of a carrier with a dual responsibility, split between carriage by road and carriage by some other means.
30. The judge pointed, as did Prof. Fitzpatrick in his article, to article 31 of the Warsaw Convention as a potential precedent on which the parties to CMR could have drawn in order to clarify the application of CMR to combined transport. However, they could not simply have incorporated article 31 into CMR, because of article 2. It remains true that the drafters could have dealt more specifically with the international road legs of combined carriage contracts, but I do not find that a very persuasive indication as to whether or not CMR applies to such legs.
31. Where some other means of carriage occurs, in circumstances not falling within article 2, it may be that there will be an initial or final leg of road carriage which is purely domestic. Although we do not have to decide the position in relation to such a leg in this case, there would also seem to me no incongruity if it were to be concluded that an initial or final domestic leg falls outside CMR, like any other domestic carriage. An example would be any road haulage within Capri, or within England or Corsica, in the hypothetical situations taken in paragraph 25.
32. I add a further word at this point on the respondents’ notice, which maintains that the judge’s conclusions should if necessary be upheld in the light of the fact that no CMR note was ever contemplated or issued. That is true, but is no answer to the application of CMR when on a true analysis the contract, which was recorded in the air waybill, was within article 1 of CMR so far as it provided for road carriage from Paris to Dublin. Article 4 caters specifically for the application of CMR to cases (not I think uncommon, for example in relation to forwarding agents contracting as carriers) where no CMR note is ever issued to record a contract for carriage by road.
33. Thus far, therefore, I see both attraction and force in a conclusion that article 1 may be read as applying CMR to the international road carriage element of a “mixed” or “multimodal” contract providing for two different means of carriage. But this leaves aside the pre-condition to the Convention’s application, constituted by the further words of article 1: “when the place of taking over and the place designated for delivery, as specified in the contract, are situated in two different countries, of which at least one is a Contracting country….”. Looking at the terms of article 1, I would not regard this pre-condition as difficult to reconcile with a conclusion that CMR may apply to the international road carriage element of a mixed or multimodal contract. The place of taking over and the place designated for delivery, as specified in the contract, can - at least in article 1 - be read as referring to the places which the contract specifies for the taking over and delivery by the carrier in its capacity as international road carrier. The prime function of this pre-condition is, moreover, not to define what is meant by a “contract for the carriage of goods by road”. It is to delimit geographically the classes of contract for carriage by road to which CMR applies, that is those involving international carriage from or to a Contracting country. That is not to say that the pre-condition may not throw other, indirect light on the scope of application of CMR, but I think that one should be cautious about treating it as undermining or precluding what would otherwise be a possible and preferable construction.
34. It is said, however, that further provisions of the Convention buttress the conclusion that “the place of taking over of the goods and the place designated for delivery, as specified in the contract” can only refer to the first moment when the relevant carrier receives and the last moment when he parts with goods in any capacity. Particular reference is made to provisions in Chapter III of CMR (dealing with “conclusion and performance of the contract of carriage"), such as (i) article 4, requiring a contract for road carriage to be confirmed by the making out of a consignment note, (ii) article 5(1), contemplating that the “sender” and carrier shall sign or stamp this and (iii) article 8(1), providing for the carrier to check the statements in the consignment note and the apparent condition of the goods on taking them over and enter any reservations in the consignment note. These articles have of course to be read in the light of the further provision of article 4, that “the absence, irregularity or loss of the consignment note shall not affect the existence or validity of the contract of carriage, which shall remain subject to the Convention”. Further, there would be nothing to prevent a carrier, like Air France, performing a road trucking leg, from issuing a consignment note, to cover the road carriage from Paris to Dublin. This would have been largely back to back with the consignment note, which Place Trucking should have issued, and may in fact have issued, to Air France in respect of the same road carriage. Any CMR note that Air France issued should have been signed and completed under articles 5 and 6, but it does not seem to me necessary to consider precisely in what capacity or terms, since I have no doubt that workable answers can be given in one way or another. Air France would either be sender itself for the purposes of the road leg from Paris to Dublin or (as may well be) acting on behalf of the sender. Article 7(2) itself contemplates that a carrier may complete the particulars in a consignment note on behalf of a sender.
35. In the context of delivery, Air France also refers to (iv) article 13, entitling the consignee, after the arrival of the goods at the place designated for delivery, to require the carrier to deliver to him against a receipt the second copy of the consignment note and the goods and (v) articles 14, 15 and 16, dealing with circumstance in which it becomes impossible to carry out the contract before the goods reach the place designated for delivery or circumstances prevent delivery.
36. It is true that all these articles are most easily understood as addressing the simple situation, of a contract performed by road throughout (or falling within article 2). But I think that one should be cautious about treating them as necessary guides to the correct interpretation of the scope of the Convention under article 1. It is understandable that the detailed articles of Chapter III should focus on core or typical situations. But that does not necessarily mean that the Convention is to be limited to those situations.

English authority

37. It is appropriate before reaching any conclusion to consider how the matter stands in terms of authority, domestic and other European. It is accepted that no English authority is directly in point. As the judge rightly said, no assistance is to be gained from the decision in Arctic Electronics Co. UK Ltd. v. McGregor Sea and Air Services Ltd. [1985] 2 LL.R. 510. As to the correct general approach, we were referred to Buchanan & Co. Ltd. v. Buchanan Forwarding & Shipping (U.K.) Ltd. [1978] AC 141, where statements are to be found both that “the correct approach is to construe the English text, which after all is likely to be used by many others than British businessmen, in a normal manner appropriate for the interpretation of an international convention, unconstrained by technical rules of English law, or by English legal precedent, but on broad principles of general acceptation” (p.152D, per Lord Wilberforce), but, on the other hand to further cautions by Lord Wilberforce, Visc. Dilhorne and Lord Salmon at pp.153C-F, 156F and 161H against any general assumption that English methods of interpretation are inferior to, or even different from continental methods. We were also referred to pungent comments in this court in Ulster-Swift Ltd. v. Taunton Meat Haulage Ltd. [1997] 1 WLR 625, 631, on the inutility of citation of continental authority, which (in that case) revealed that courts in six member states had produced 12 different interpretations of particular provisions on CMR.
38. It is, however, clear from the speeches of both Lord Wilberforce (p.153E-F) and Lord Salmon (p.161E-G), and as a matter of general principle, that the English court should try to harmonise interpretation of CMR, as any other international convention, with any recognisable body of foreign law that has developed. The importance of this consideration is underlined in the case of CMR, when article 31 allows a claimant considerable scope for choosing between different forums (particularly those of the defendant’s residence, the place where the contract was made, the place of taking over and the place designated for delivery). Further, we should take note in relation to CMR, as much as the Warsaw Convention, words of Lord Hope in Fellowes (or Herd), above, at p.553D-G:

“In my opinion the Convention agreed at Warsaw, as amended at the Hague, was intended to be, and is, capable of accommodating changes in the practice of airlines and aircraft operators with regard to the purposes of which aircraft are used to carry people and goods, and in the contractual arrangements in pursuance of which people and goods are carried by air for reward. For this reason I think that it is proper to read Lord Bridge's discussion in Holmes v. Bangladesh Biman Corporation [1989] AC 1112 and Greene L.J.'s judgment in Grein v. Imperial Airways Ltd.[1937] 1 KB 50 from which he quoted as having been framed with reference to the particular subject matter with which they were dealing at the time. In each of these cases the subject matter was carriage by air of the ordinary kind in pursuance of a contract between the airline and the passenger by which places of departure and destination had been agreed. It seems to me, that when regard is had to the desire to lay down a uniform international code which would achieve equity between the carrier and the user of his services, there is no necessary conflict between what they said in these cases and the wider interpretation of the phrase "carriage by air" for which the respondents contend in this case.”

Other European authority

39. Against this background, I turn to authorities from other European countries. We were referred to a number of authorities (including two in the German Supreme Court, the BGH) to which the judge’s attention was not drawn. Taking first the question to what extent the application of the Convention depends upon a carrier having obliged itself contractually to carry by road (and by no other means), the Belgian and Dutch courts have treated case (c) (described in paragraph 15 above) as falling within CMR in The Atlas Assurance Cy Ltd. v. Ocean Transport and Trading Ltd. (Antwerp Commercial Court; 23/9/75) [1976] 11 ETL 279, The Atlas Assurance Cy Ltd.v. Peninsular Oriental Steam Navigation (The “Osaka Bay”) (Antwerp Commercial Court; 4/1/77) [1977] 12 ETL 843 and International Marine Insurance Agency Ltd. v. P & O Containers Ltd. (The “Resolution Bay”) (Rotterdam Rechtbank; 28/10/99).
40. In the first Belgian case, the combined transport bill of lading covered carriage from loading in Hong Kong to Antwerp, with the port of discharge being specified as Rotterdam, and no specification of the method of carriage between Rotterdam and Antwerp. As the report recites: “The latter section of the combined transport could be done either by using another vessel calling at the port of Antwerp either by barge or lighter, or by road transport, or even by rail, the choice not being fixed and being left to the decision of the carrier”. Ocean Trading and Transport had in fact chosen to carry by road, and the court held that, since it had “instituted a road transport from Rotterdam to Antwerp, [it] is, as far as this transport is concerned, and whether [it] likes it or not, subject to the mandatory regulations applicable in the matter”. CMR was thus applied to the leg from Rotterdam to Antwerp. There is no indication that this resulted from anything other than the mandatory application of CMR in Belgium, as in the United Kingdom.
41. The second Belgian case also concerned carriage under a combined transport bill of lading from Hong Kong to Antwerp, with Rotterdam being named as the discharge port. The short report does not go further into the contractual terms, but simply records that CMR was held to apply to the leg from Rotterdam to Antwerp which was performed by road.
42. The third (Dutch) case again concerned carriage under a combined transport bill of lading from Port Chalmers, New Zealand to Antwerp as the “place of delivery” with Rotterdam being named as the “port of discharge”, with no statement in this document as to by which means of transport the leg from Rotterdam to Antwerp was to be carried out. The court held that:

“4.3 Since under the combined transport of goods P & O has opted to arrange part of the transport, i.e. from Rotterdam to Antwerp, by truck/by road whereas the contract, as contained in the CT document allows it to do so, the place where P & O and/or [its] representative …. took delivery for transport by road, i.e. Rotterdam, counts [i.e. geldt in the Dutch] as the place of receipt stated in the contract for the purpose of art. 1 para. 1 of CMR.”

The court accordingly held CMR to apply to the leg from Rotterdam to Antwerp: paragraph 4.4. Turning in the same paragraph to article 31 of CMR, according to which a plaintiff may found jurisdiction in the courts of a country within whose territory “the place where the goods were taken over by the carrier …. is situated”, the court went on:

“Since in the meaning of this [article] the ”place of receipt of the goods” must be considered to be the place where P & O and/or the third party called in [i.e. the actual haulier] took delivery of the container for transport by road, in that case the Dutch judge has international jurisdiction ….”

43. The German Supreme Court (“BGH”) has also stated that CMR would apply in a like manner. In its judgment of 17^th May 1989 (I ZR 211/87), it was concerned with the forwarding of electronic components by A (to whose insurers any cause of action had passed), under an air waybill which identified Stuttgart as the departure point, Algiers as the destination and the second defendants, a member of IATA, as first air carriers. The second defendants entrusted to a German airline the carriage by air from Stuttgart to Algiers. The latter engaged sub-contractors to carry the goods by road from Stuttgart to Frankfurt, in order that they could be carried thence by air to Algiers. The goods were however destroyed by fire after an accident during the road journey.
44. Paragraphs I and II(1) of the BGH’s judgment make clear that the case proceeded both below and before the BGH on the assumption that the contract between A and the second defendants was for air freight (carriage by air). However, the BGH said that this has no bearing on its decision, and that it was also unnecessary to consider whether the actual carriage of goods by road from Stuttgart to Frankfurt was permitted to the second defendants under this air freight contract, whether upon its true interpretation or because of its incorporation of an IATA-Resolution (507 B). It said that an air carrier was liable in any event, according to whatever were the rules applicable to the carriage by road, for transit damage suffered by air freight in the course of carriage by road – whether or not in accordance with the contract (“order”). It cited as potentially relevant rules the German Commercial Code (“HGB”) para. 429 et seq., the Kraftverkehrsordnung (“KVO”) or from 15^th May 1989 GFT (Tariff for the Long-Distance Transportation of Goods, para. 29 et seq. and CMR, article 17 et seq.).
45. The BGH’s at first sight puzzling reference to liability under such rules in the event of carriage by road contrary to the provisions of a contract for carriage by air is explained in subsequent paragraphs. In the immediately following paragraph, the BGH dealt with the position on the assumption that the contract of air carriage entitled the second defendants to perform a leg from Stuttgart to Frankfurt by road instead of air. On that basis, the court said, the carriage by road constituted contractual performance (“amounts to a contractual service”), and was governed by the relevant rules, which were (this being carriage by road within Germany) those of the KVO. In the paragraph thereafter, the BGH considered the position on the opposite hypothesis, namely that the carriage by road was uncontractual, and said that in that event, the second defendants were liable for transit damage at least to the same extent. A breach of the contract for air freight could not improve the second defendants’ position. A party in breach of such a contract must at least accept the transport risk associated with the means of transport selected in breach of contract and the system of liability (here the KVO) thereby entered into. The BGH added however that it was not necessary to decide whether, and in accordance with what rules, the carrier might be further liable in the case of a breach of the air freight contract consisting of carriage of goods by road contrary to the contract.
46. It is therefore clear that, if the relevant road carriage had extended from Stuttgart to an airport outside Germany (for example Charles de Gaulle) from whence the goods were to be forwarded by air to Algiers, the BGH would have held (1) that CMR applied to the road carriage from Stuttgart to Paris, if the air carrier was under the air freight contract permitted so to perform and that (2) if the air carrier was not so permitted, then the air carrier’s minimum responsibility would have been that imposed by CMR, but that it would be open to argument (since the BGH did not need to determine the point in the case before it) that further, higher liability should flow from the breach of the air freight contract. Thus, the highest German court has adopted the view that CMR applies even in case (d) to which I have referred in paragraph 15 above.
47. In an earlier decision dated 24^th June 1987 (I ZR 127/85), the BGH was concerned with a counterclaim for loss of part of a container load of goods during carriage from the Saar to Portadown in Northern Ireland. The contract covered two consignments, one to travel by low loader, the other in a container. The container was carried by road to Rotterdam, where it was shipped without trailer to Belfast. In Belfast the plaintiff carrier terminated the carriage, because of a dispute about payment of the carriage charges. As to the nature of the contract, the BGH said (paragraph 2(aa)) that

“It cannot be assumed from the findings as stated that the container was to be carried on a roll-on, roll-off basis (cf art. 2 CMR). Neither was the container in fact carried in this manner. As the Appeal Court correctly found, the container was shipped to Belfast without a trailer. The Appeal Court denied that the parties had agreed on the applicability of the CMR for the transport from Rotterdam onwards. This is not the subject of any legal reservations, at least for the section of the route by sea.”

48. In its judgment, the BGH considered a previous line of authority relating to situations in which a carrier or forwarding agent had undertaken to carry by road from A to B, but had then “pleaded that the damage occurred prior to or after the transportation of the goods, or at another place in respect of which the carrier [could contract out of its liability]”. In that previous line of authority, the court had developed the theory of “overall consideration” (Gesamtbetrachtung - an overall consideration or examination), so as to hold the carrier liable as a carrier by road throughout. But in case I ZR 127/85 the BGH held this theory inapplicable. It said, first, that this theory had no application to cases where the subject of the transport was a priori (i.e. from the outset) the transport of goods using various means of transport (in the case before it, the carriage by truck and by ship of the container which became lost). It said secondly that

“The same applies when different regulations on liability – e.g. the CMR and the Warsaw Agreement – are specified as mandatory with regard to the means of transport used for the various sections of the route”.

49. The court then reverted to the first point:

“But even when this is not the case, the viewpoint of the overall consideration cannot be taken as authoritative where different means of transport are used to carry out the transport of the goods. According to the line of precedents …. referred to above, in the assessment of a transport as an overall transport with a single set of regulations on liability the decisive consideration is whether it can be assumed from the order, viewed from the overall [i.e. viewed overall], that the transport is a uniform long distance goods traffic transport, using motor vehicles. ….. However, this is not possible with combined (multimodal) transport, as here. Although here also the subject of the order is the transport of the goods over the entire route from the place of despatch to the place of delivery to the recipient, nevertheless this transport, in respect of which it was clear between the parties from the start [that it was] a transport to be carried out by combining by a combining a variety of means, was to be undertaken in various stages and with different means of transport”

50. In the result the BGH accepted the Stuttgart regional court of appeal’s view that CMR only applied to the carriage of the container from the Saar to Rotterdam. It held that, while CMR itself contained no provision regulating the burden of proof as to whether any loss or damage occurred when the goods were in the care of the CMR carrier or on some other occasion, as a matter of general German law the burden of proof in respect of the place of damage lay on the carrier.
51. The primary reasoning of the BGH thus concerns either case (a), or - if there was some, unmentioned and unutilised, contractual liberty to carry from the Saar to Rotterdam by means other than road - case (b), identified in paragraph 15 above. But the second reason given by the BGH (see paragraph 46 above) contemplates that CMR may have a wider, overriding application, in other cases. The later decision of the BGH dated 17^th May 1989 (I ZR 211/87) indicates that this is so, and that CMR applies in all of cases (a), (b), (c) and (d).
52. We were referred to an earlier decision of the regional court of appeal of Frankfurt am Main, dated 11^th November 1981 (VersR 1982 Vol. 28 p.697), in which the court expressed the view, in the context of a contract for air freight from Germany to France, that the exercise of a mere liberty under IATA condition 507B to carry by road (because of a shortage of aircraft hold space) without informing the consignor, did not make CMR applicable – and that the Warsaw Convention was equally inapplicable because there had been no actual air carriage. So the actual contract was governed solely by the carrier’s own conditions. Although the court said that IATA condition 507B allowed the carrier to comply with its contractual obligation by using road transport, it went on to refer to “the absence of a relevant contractual obligation”. It also reasoned that any other solution “would be unreasonable and lead to considerable legal uncertainty”, since it would enable a carrier to select whichever means of carriage provided the most favourable liability regime. However, the net result was that neither Convention applied to international carriage, and that the carrier could simply impose whatever contractual terms it wished, which I would have thought was a far more unreasonable result. The reasoning in this case appears to me unpersuasive and to have been overtaken by the BGH’s more analytical judgments, to which I have referred. Dr Ruhwedel’s work on Air Transport Law, to which we were referred, and which refers to the Frankfurt am Main decision, was published in 1987, and so makes no reference to either of the BGH’s decisions.
53. I turn to two cases, arising out of the same accident, decided by the tribunal de commerce of Bobigny in France. They are Cie General Accident Fire and Life Assurance Corp. v. Sté Saga Air Mory on 24^th September 1994 and Les Mutuelles du Mans v. Transport Assistance Services on 24^th November 1995. Various consignors entrusted DAS with the carriage of goods from Roissy in France to Nigeria. DAS engaged the services of its local representative, TAS, which in turn engaged VAS to carry the consolidated cargo from Roissy to Gatwick, for carriage by a DAS aircraft from Gatwick to Nigeria. VAS used as trucker Plane Trucking, whose vehicle caught fire on the way (evidently while still in France), destroying most of the cargo. In each case, the parties in interest asked the court to determine whether the loss was regulated by the Warsaw or CMR Convention. The contract between consignor and DAS was “made concrete” by an air waybill. This provided by condition 2.1 that the carriage performed by virtue of its conditions “is subject to the liability rules laid down by the Warsaw Convention”; and by condition 8.1 that “the carrier …. may with advance notice and taking account of the consignor’s interests, consign the goods by other means of carriage”. In each case, the court said:

“…. thus it has been clearly agreed between the parties to the contract of carriage that:

on the one hand, the carriage would be subject, with regard to liability rules, to those of the Warsaw Convention,

on the other hand, that, in order to perform the carriage, the carrier may, at his discretion, in the interest of the consignor, consign the goods by other means of transport;

Whereas thus the fact that DAS decided to route the goods by road between Roissy CDG and Gatwick falls within the parties’ agreements and does not alter the basic nature of the carriage, that is, carriage by air, at least with regard to the application of liability rules;

That thus the provisions of the Warsaw Convention must be applied to relations between the consignor and the air carrier, DAS, on the subject of the carrier’s liability.”

54. The court went on in each case to hold that the liability of all concerned in the carriage (DAS, TAS, VAS and Plane Trucking) was therefore governed by the Warsaw Convention. A note to the second report observes that a comparison of the two contractual clauses on which the court relied

“leads one to conclude that in the case of the use of the route by road, the [Warsaw Convention] alone is applicable, by virtue of the theory of outward appearance with regard to the consignor and its clear and precise terms. The notion of proxy being excluded, the air carrier who takes on the goods under an AWB is obliged to consign them according to the agreed conditions: if he contests same, one may reproach him, at least for failure in his duty to advise (need to advise the consignor of any [the possible] consequence[s] … of changing the method), or even worse (fraud^[1]).”

55. Neither judgment makes any reference to any carrier having given notice to the consignor of the change of method of transport (despite the requirement in condition 8.1), and this note suggests that there may have been no such notice. Against this, on the other hand, the tribunal de commerce expressly referred in each case to the carriage of road between Roissy and Gatwick as having fallen “within the parties’ agreement”. Taking the tribunal’s statement literally, the decisions therefore concerned facts falling within case (d), considered in paragraph 15 above; and, on this basis, the French court’s attitude, contrary to that of the BGH, was to apply the Warsaw Convention throughout, rather than to apply the Warsaw Convention to the air leg and CMR to the road leg. However, it is clear, from both the court’s reasoning and the commentator’s note, that the French court’s decision is only applicable in the narrow sphere of case (d).

The first question - summary

56. The European authority on the first question can thus be summarised as follows. The Belgian, Dutch and German courts have all held that CMR can apply to carriage by road internationally in case (d), as well as necessarily in cases (a), (b) and (c). The French court (the tribunal de commerce of Bobigny) has reached what appears, from its reasoning, to be the opposite conclusion, although there is some room for doubt about this, bearing in mind, firstly, the absence in its judgments of any reference to “advance notice” of the changed means of carriage having been given as required by condition 8.1 and, secondly, the terms of the commentator’s note. Assuming that the tribunal’s decision does stand for an opposite conclusion to that reached in Belgium, the Netherlands and Germany, it is clear that its reasoning can only apply in case (d), and not cases (a), (b) and (c) described in paragraph 15 above. The present case falls, I have concluded, within case (b). So all such European authority as has been produced suggests that CMR should be applied to the carriage by road from Paris to Dublin, subject to the answer to the second question. This confirms the answer that I would give to the first question, without the benefit of any authority (see paragraphs 15-22 above).

The second question

57. The second question is to what extent (if at all) a contract can be both for the carriage of goods by road, within article 1, and for some other means of carriage, to which CMR does not apply. In terms of other European authority, this question can be readily answered. The Belgian, Dutch and German cases all unequivocally accept that CMR can apply to the road leg of a larger contract for carriage, involving different methods of transport. The Dutch court expressly addressed the reference in article 1(1) of CMR to the “place of taking over” or “receipt” as specified in the contract, and found no difficulty in treating this as Rotterdam, where the second road leg succeeded the initial sea leg, and the defendants assumed the capacity of road carriers. Other European courts cannot have seen any difficulty worth mentioning in adopting the same analysis. Hence, CMR’s application in the Belgian and Dutch cases to the final Rotterdam-Antwerp legs of contracts starting with long sea legs from the Far East or New Zealand. Hence, the German Supreme Court’s indication in its judgment of 17^th May 1989 (I ZR 211/87) that CMR could apply to the initial road leg of a larger contract, and its decision on 24^th June 1987 (I ZR 127/85) that it applied to the road leg from the Saar to Rotterdam under a contract covering carriage of a container (not on a roll-on, roll-off basis) from the Saar to Portadown in Northern Ireland. (I repeat that the judge left open a possibility that CMR might apply to an initial, but not a final, road leg of a larger multimodal contract, but, whatever the scope of CMR may be, I do not consider that it can or should sensibly be construed to draw any such distinction.) I can also mention briefly in this context another consistent earlier decision, by the Oberlandesgericht (regional court of appeal) of Düsseldorf on 8^th May 1969, [1970] 5 ETL 446. It had to consider the carriage of cars from Bochum to Newark in the USA, performed by road to Antwerp and thence by sea. The relevant damage occurred during the road carriage. The court said that it was unnecessary to decide (it was “by the way”) whether the vehicles were consigned on the basis of a uniform freight order (i.e. one covering the whole transport from Bochum to Newark) or whether the consignors placed several freight orders (i.e. including a distinct order for the leg from Bochum to Antwerp), and it went on to apply CMR to determine liability for damage occurring during the Bochum-Antwerp leg.
58. Finally, nothing in the decisions of the tribunal de commerce of Bobigny points to any other answer to the second question. If anything, the tribunal’s reasoning indicates that CMR can apply to a single leg of a larger contract, unless “the basic nature of the contract” is for some other method of carriage. Otherwise, the tribunal would have been able to give another and shorter answer to the suggestion before it that CMR applied to the leg from Roissy to Gatwick. In respect of a contract involving two distinct legs, one by air, the second by road within case (a) or (b), if one asks, in the tribunal’s terms, what was “the basic nature of the contract”, the answer would have to be road carriage as regards the road leg. Even if the second leg fell within case (c), its nature would be open, so that, in that case too, CMR could apply to the second leg, if it was performed by road.
59. The weight of the European authority is thus firmly in favour of a conclusion that CMR is applicable to an international road leg of a larger contract in cases (a), (b) and (c) mentioned in paragraph 15. While I see the force of the objections suggested by Prof. Fitzpatrick and accepted by the judge, my own inclination, apart from authority, would have been in the same sense. As it is, and with the benefit of such authority, I have no real hesitation about adopting the conclusion which other European countries have reached. For my part, I would also favour the German Supreme Court’s view that CMR is applicable in case (d). I reach these conclusions on the basis that the concept of a contract for the carriage of goods by road embraces a contract providing for or permitting the carriage of goods by road on one leg, when such carriage actually takes place under such contract. The place of taking over and delivery of the goods under article 1(1) are to be read as referring to the start and end of the contractually provided or permitted road leg. Detailed provisions, such as articles 4, 5(1), 6(1), 8(1) and 13-16 of CMR fall to be operated with the carrier (or its representatives) so far as necessary putting itself in the position of the consignor or consignee when taking over goods at the start of a road leg, which is not the first leg in the overall carriage, or when delivering up the goods at the end of a road leg, which is not the last leg in the overall carriage.

Overall characterisation?

60. I return to say a further word about the judge’s primary ground of decision and Mr McLaren’s secondary submission supporting it. The judge considered that article 1(1) of CMR requires that it should be possible to characterise the relevant contract overall as a contract for the carriage of goods by road internationally. If that were so, then prima facie it would appear that CMR should apply throughout to all aspects of carriage under any contract which could, overall, be classified as being for carriage by road. The short sea legs could, for example, be ignored in the examples previously taken of carriage from Stockholm to Capri or Spain to London, even though the goods did not remain on a trailer for them. That would amount to saying that the parties to CMR did achieve a true multimodal convention, whilst disclaiming having done so. Further, it would not fit with article 2. CMR would be potentially applicable to the sea legs despite the absence of any equivalent provisions to article 2(1), second sentence, and article 2(2). It would also be left unclear whether article 2 also operated as a tacit exception to the (unstated) rule that CMR only applied if the contract could be characterised overall as being for carriage by road. The judge avoided these problems, by his further conclusion (on the second question above) that CMR is incapable of applying to a contract for carriage by road unless the whole contract is for carriage by road or article 2 applies. In effect, he required, as the key to the application of CMR under article 1(1), both an overall characterisation of the whole contract and (save to the extent provided in article 2) an individual characterisation of each leg as involving carriage by road. Once one introduces both requirements under CMR, the former requirement is in reality subsumed within and overtaken by the latter.
61. An approach which took as the key to the application of CMR simply the overall characterisation of the whole contract would have the flavour of the (now substantially discarded) German doctrine of Gesamtbetrachtung (see the discussion in the BGH decision of 24^th June 1987), as well as of the tribunal de commerce of Bobigny’s reasoning based on “the basic nature of the contract”, in the context of a contract for carriage by air subject to an option to elect for some other means. But the BGH’s doctrine and the tribunal’s reasoning were used to hold that a whole contract was subject to the rules regulating the transport that was characteristic of the contract. Tomlinson J expressly declined to adopt a like approach, since, having held that the present contract was characteristically for air carriage, he held that the carriage from Charles de Gaulle to Dublin was not subject mandatorily to the Warsaw Convention; rather, it was subject to Air France’s conditions - and thus only subject to the terms of that Convention to the extent that Air France had chosen to apply them contractually.
62. Under CMR, for reasons already given, neither the German doctrine of Gesamtbetrachtung nor the decisions of the tribunal de commerce of Bobigny lend any possible support to the judge’s approach in any but case (d), which is not this case. Nor do I see attraction for the judge’s approach under CMR on any other basis. To recapitulate points that I have already covered, its logic as a separate point would appear to be that CMR should apply to the whole of any multimodal transport, regardless whether any not-road leg was conducted by roll-on, roll-off transport. Secondly, its effect would be to take agreed international carriage by road outside any Convention (Warsaw or CMR) in circumstances where the contract overall could not be characterised as primarily for road carriage. Thirdly, it would be inconsistent with the general European approach in the cases I have described, which (in the case of Germany since the BGH decisions) undertake no such process of identification and show that it is no obstacle to the application of CMR that the contract was pre-dominantly for some means of carriage other than road (cf e.g. the facts of the Belgian and Dutch cases and the BGH decision of 17^th May 1989). Fourthly, it would open up a prospect of metaphysical arguments about the essence of a multimodal contract. Why should a contract for carriage have only one characteristic? The judge’s conclusion that the present contract was pre-dominantly for carriage by air reflects the comparative distances, as well as the physical obstacles, that had to be overcome between Singapore and Dublin. But there would be other cases where comparisons of time and space, and the physical obstacles that carriage was designed to overcome, would lead to no very obvious result. How would one characterise a contract for carriage by road from Stuttgart to Paris and thence by air to Gatwick? Viewed overall, contracts can by their nature or terms have two separate aspects, and the present, despite the length of the air leg, was in my view just such a contract. The real question is thus that with which I have already dealt as the second question in paragraphs 56-58 above.

Academic writing

63. Like the judge, we were referred to considerable academic writing, particularly to what the judge rightly described as Prof. Fitzpatrick’s penetrating article, Combined Transport and the CMR Convention [1968] JBL 311, to which I have already referred, and Prof. Malcolm Clarke’s well-known standard text on International Carriage of Goods by Road: CMR (3^rd ed; 1997) as well as an article written by Prof. Clarke critical of Tomlinson J’s conclusions, Carriage by Road [2002] JBL 210. I have found these helpful in identifying the issues and considerations. They take different views on the central issues, Prof. Fitzpatrick (writing in the very early days of CMR without the benefit of any authority) took the view that the place of taking over and delivery in article 1(1) can only refer to the initial taking over and final delivery at the start and end of any contract for carriage and that the force of the word “for” in that article is less than either I or subsequent European authorities consider. Prof. Clarke in his book refers to and argues for the views taken by the Belgian and Düsseldorf courts, and in his article draws attention to the German Supreme Court decisions, which I have considered. If I say no more about these writings, it is not because I have not found them valuable, but because I have already covered the main points in this judgment.
64. I would only record that Mr McLaren did not seek to support before us Prof. Fitzpatrick’s final suggestion that the exclusion (in the part of the Protocol of Signature set out at the end of the Convention as scheduled to the 1965 Act) of the application of CMR “to traffic between” the UK and Northern Ireland and the Republic of Ireland

“would seem to imply that the exclusion is not confined to a carriage originating in either country. Hence the exclusion would cover the situation where such traffic is part of a larger contract of carriage and in such case the Convention is apparently meant not to apply pro tanto”.

If that had been right, another metaphysical question would have arisen, bearing in mind the present loss in North Wales - namely at what point, in the course of roll-on, roll-off carriage from Paris to Dublin, do goods cease to be “traffic between” France and the UK and become “traffic between” the UK and Eire, and whether there is any intermediate period over which the goods can be said to be simply traffic within the UK. Mercifully, no such question arises.

65. I would therefore conclude that the present contract was for carriage by road within article 1(1) of CMR in relation to the roll-on, roll-off leg from Charles de Gaulle, Paris to Dublin, and that Air France’s own conditions are to the extent that they would limit Air France’s liability overridden accordingly. It is thus open to the claimants to seek to show under article 29 of CMR that there was wilful misconduct or equivalent default, disentitling Air France to limit its liability for the loss which occurred during the road transit. It has been however agreed between counsel that this issue should be remitted to the Commercial Court to be dealt with there.

Lord Justice Latham:

66. I agree.

Lord Justice Aldous:

67. I also agree.
Order: Appeal allowed; the order to be in the terms of the agreed order; permission to appeal to the House of Lords refused. (Order not part of approved judgment)

Note 1   In the French, dol - “wilful misrepresentation” might perhaps be a better translation.    [Back]