Ningbo Maritime Court of the People¡¯s Republic of China
Plaintiff : Yiwanda Shoes Co., Ltd.
Domicile : No.16 Niusanjiao Road, Lucheng District, Wenzhou, Zhejiang, China
Legal Representative : Kan Shengqi, Chairman of the Board
Agents ad litem : Dong Tianxing and Chen Jianping
Lawyers of Highchance Law Firm, Zhejiang, China
Defendant : CMA CGM S.A., France
Domicile : 04, Quai D¡¯Arenc-13002 Marseille, France
Legal Representative : Philippe Blanchet, General Counsel of Legal Department
Defendant : CMA CGM (China) Shipping Co., Ltd.
Domicile : Floor 39, Bund Center, No.222 East Yan¡¯an Road, Shanghai, China
Legal Representative : Farid T. Salem
Defendant : CMA CGM (China) Shipping Co., Ltd. Ningbo Branch
Domicile : Floor 24, Portman Mansion, No.48 North Caihong Road, Jiangdong District, Ningbo, Zhejiang, China
Representative : Chen Jingjuan, General Manager
Agents ad litem of : Wang Hongyu/Wang Canming,
the above three Lawyers of Wang Jing & Co. Law Firm Shanghai Office
For the case of dispute over compensation for cargo loss arising from the contract of carriage of goods by sea with the Defendant CMA CGM S.A., France (hereinafter referred to as ¡°CMA CGM¡±) and the Defendant CMA CGM (China) Shipping Co., Ltd. Ningbo Branch (hereinafter referred to as ¡°CMA CGM Ningbo¡±), the Plaintiff Yiwanda Shoes Co., Ltd. (hereinafter referred to as ¡°Yiwanda¡±) filed a lawsuit before this court on 13 March 2009. After this court accepted the case on the same date, a collegial bench was formed in accordance with the laws. On 17 March 2009, the Plaintiff applied to add CMA CGM (China) Shipping Co., Ltd. (hereinafter referred to as ¡°CMA CGM China¡±) as a co-defendant, and this court approved the application. A public court hearing was held on 12 May 2009 by this court for trying this case. The agent ad litem of the Plaintiff, Dong Tianxing, and the agent ad litem of the three Defendants, Wang Canming, attended the court hearing. Now the hearing of this case has been completed.
The Plaintiff Yiwanda alleged that: in October 2008, the Plaintiff transported 903 cartons of polyurethane men¡¯s shoes from the port of Ningbo to the port of Cotonou, Benin through Wenzhou Howin International Transportation Co., Ltd. (hereinafter referred to as ¡°Howin¡±), and the Defendant CMA CGM was entrusted to undertake the transportation. On 4 October 2008, the above shoes were shipped at the port of Ningbo through the Defendant CMA CGM Ningbo. The bill of lading number was NBLG005945 and the container number was ECMU1222463. On 16 December 2008, the Defendant CMA CGM informed the Plaintiff through the Defendant CMA CGM China in written form that water flooded into the hold during the sea transportation, and the cargo of the Plaintiff suffered a ¡°total loss¡±. The Defendant CMA CGM China notified the Plaintiff to provide the original bills of lading for cargo disposal, and the Plaintiff delivered the three original bills of lading to the Defendant in January 2009. The value of the cargo delivered by the Plaintiff to the Defendant for transportation was USD75,852, and the ocean freight for USD3,220 had been paid. The Plaintiff phoned and sent letters to the Defendant several times for the above-mentioned cargo loss, which, however, were all left aside by the Defendant. The Defendant CMA CGM caused cargo ¡°total loss¡± during cargo transportation, and thus infringed upon the property ownership of the Plaintiff, which had constituted a tort. Therefore, the Defendant CMA CGM should compensate the Plaintiff for the economic loss therefrom. The Defendant CMA CGM Ningbo, as the issuer of the bill of lading, should assume joint and several liabilities. Hence, the Plaintiff requested this court to order that: firstly, the Defendant CMA CGM should compensate USD75,852 for the cargo loss and USD3,220 for the ocean freight, equivalent to RMB590,947 in total; secondly, the Defendants CMA CGM China and CMA CGM Ningbo should assume joint and several liabilities; and thirdly, the court fee should be assumed by the three Defendants. In the court hearing, the Plaintiff altered the claims, requesting the three Defendants to assume joint and several liabilities on the ground of breach of contract, and confirmed the first claim to be paid in US dollars.
The three Defendants failed to submit defence in written form within the prescribed defence period but orally argued during the court hearing that: firstly, the total loss of the cargo alleged by the Plaintiff was factually groundless, as the cargo was in good condition upon and after discharge. Secondly, there was no evidence to prove the amount of the freight and the fact that the Defendant had collected the freight. Thirdly, CMA CGM China and CMA CGM Ningbo should not assume joint and several liabilities for the cargo loss.
To support the claims, the Plaintiff Yiwanda provided this court with the following evidence:
Evidence 1, the Enterprise Business License to prove the Plaintiff¡¯s proper capacity;
Evidence 2, the confirmation of bill of lading, to prove the fact of transportation entrustment;
Evidence 3, the copy of the original bills of lading, to prove the fact that the Defendant actually undertook the transportation;
Evidence 4, the letter of CMA CGM China dated 16 December 2008, to prove that the Defendant admitted the fact of cargo loss;
Evidence 5, the letter of the consignee dated 7 January 2009, to prove the fact that the customer failed to receive the cargo and refused to make payment;
Evidence 6, the invoice, to prove the value of the damaged cargo;
Evidence 7, the receipt, to prove the fact that the original bills of lading were held by the Plaintiff and were withdrawn by the Defendant;
Evidence 8, the confirmation of ocean freight, to prove the loss of freight;
Evidence 9, 4 freight invoices, to prove that the Plaintiff had paid the freight;
Evidence 10, the packing list, invoice, verification and writing-off sheet and customs declaration form, to prove the value of the cargo;
Evidence 11, the sales invoice, to prove the value of the damaged cargo;
Evidence 12, mails and cargo photos sent by the customer, to prove that the cargo had been disposed of;
In order to support the defence, the three Defendants provided this court with the following evidence:
1. the survey reports dated 18 December 2008 and 26 November 2008 and cargo photos, to prove that the cargo in question was in good condition;
2. 5 sets of emails, to prove that the Defendant notified the Plaintiff that the cargo was in good condition and requested the Plaintiff to take delivery of the cargo, however the Plaintiff took no action but only claimed for compensation based on the Defendant¡¯s notice of 16 December 2008.
After cross-examining the evidence during the court hearing, the three Defendants had no dissension to Evidence 1, 2, 3, 7 and 11, nor any dissension to the formal authenticity of Evidence 4, 9, 10 and 12, but viewed that: the content of Evidence 4 just referred to the temporal condition of the cargo while no actual total loss was finally confirmed, so such evidence could not constitute an admission of the fact of cargo loss by the Defendant; Evidence 5 was a hard copy of an email, the authenticity of which needed to be proved by other materials, besides, it had no direct relevance to this case; the ocean freight stated in Evidence 8 was for 2 containers, and the contents such as the bill of lading number and the port of loading was not stated in Evidence 9, so such 2 pieces of evidence lacked relevance to this case; as the invoice in Evidence 10 was prepared by the Plaintiff unilaterally, it could not prove the value of the cargo; Evidence 12 could not prove the fact claimed by the Plaintiff. The Plaintiff had no dissension to the formal authenticity of the evidence provided by the three Defendants, but viewed that: the photo taking time was uncertain; the time of surveys was around the issuance of the confirmation by the Defendant, and the survey reports did not draw a conclusion that the cargo was finally in good condition, which could not support the defence of the three Defendants; the email correspondences could not prove that the cargo was in good condition, and on the contrary they showed that the carrier had claimed on the insurance, the P&I club also alleged that the cargo was damaged at the terminal and was under destruction, and the customer failed to receive the cargo at issue and had no knowledge of the status of the cargo.
After examination, this court holds that: the authenticity of Evidences 1 to 4, Evidence 7, Evidences 9 to 12 provided by the Plaintiff can be affirmed; in terms of Evidence 4, dispute arises between the two parties with respect to the meaning of the statement that ¡°at the time being, your cargo aforementioned is in a status of TOTAL LOSS¡±, which shall be understood as ¡°your cargo aforementioned is in a status of total loss at present¡±; Evidence 5 is a hard copy of an email, but its content can be verified by the emails between the agent at the destination port and the consignee provided by the three Defendants, therefore it can be affirmed; Evidence 6 is a part of Evidence 10, and Evidence 10 and 11 are consistent with each other, so such evidence can be affirmed; in regard to Evidence 8 and 9, although the amount of the freight and other charges of the cargo in question is unclear, the three Defendants have confirmed in the court hearing that the ocean freight and the other charges for the two containers stated in Evidence 9 were USD5,600 and RMB5,740 respectively, which are reasonable. After averaging, the ocean freight and the other charges for each container are determined to be USD2,800 and RMB2,870, which has little difference with USD3,220 claimed by the Plaintiff after adopting the current exchange rate; Evidence 13 will not be accepted as the dissension of the three Defendants is tenable. The formal authenticity of the 2 groups of evidence provided by the three Defendants can be affirmed. However, just as pointed out by the Plaintiff, the survey reports were issued before CMA CGM Ningbo withdrew the original bills of lading for claim settlement. It then can reflect that at least till the date of withdrawal of the original bills of lading i.e. 13 January 2009, CMA CGM China and CMA CGM Ningbo were still notifying the Plaintiff that the cargo needed to go through claim settlement procedure due to the cargo loss. The allegation that no one took delivery of the cargo upon notice was only mentioned in the email of 16 January 2009 from CMA CGM to the Plaintiff, and there is neither any evidence to reflect that the three Defendants had formally notified the Plaintiff of changes of their declarations of cargo total loss and withdrawal of the original bills of lading, nor any confirmation or reply received from the Plaintiff. Still less, CMA CGM sent email to the Plaintiff on 13 February 2009, claiming that the claim documents had been delivered to the P&I club and requiring the Plaintiff to communicate directly with the P&I club. To sum up, the evidence provided by the three Defendants are not sufficient to prove their allegation that after the cargo was found in good condition by inspection, the Defendants had changed its previous declaration that claim settlement was required for the cargo due to the total loss, and the Defendant had expressly notified that the Plaintiff should continue to perform the obligation of cargo delivery at the destination port.
According to the statements of the two parties and the valid evidence affirmed by this court, this court finds the facts as follows: Yiwanda sold 903 cartons of men¡¯s shoes in value of USD75,852 to Elozona Okoli, and the cargo was shipped on board MV ¡°CMA CGM ACAJU¡± of CMA CGM at the port of Ningbo by the freight forwarder Howin. CMA CGM Ningbo issued the original bill of lading of CMA CGM on 4 October 2008, in which the bill of lading number was NBLG005945, the container number ECMU1222463, the shipper Yiwanda, the consignee Mr. Elozona Okoli, the port of discharge Cotonou, Benin and the freight prepaid. Yiwanda paid Howin USD2,800 for the ocean freight and RMB2,870 for the other charges for the cargo in question.
On 21 November 2008, the cargo arrived at the port of Cotonou. On the next day, 32 containers including the cargo in question were opened for inspection at the terminal. The survey report dated 26 November 2008 viewed that the cartons of men¡¯s shoes in the container No.ECMU1222463 were apparently dry, and the real condition to be determined at stripping; the survey report dated 18 December 2008 showed that the both sides were set out at mid length, which may indicate an internal shift, or swollen cargo; the container had multiple indents and scratches, and heavy water staining below the lower door seal; contents found to be dry sound and suitable for onward shipment. During the period, CMA CGM China notified Yiwanda on 16 December 2008 that it was informed by their headquarters that water had flooded into holds No.1 and No.3 of the second leg vessel MV ¡°CMA CGM ACCRA¡± FX119W during the voyage, and the cargo was in a status of total loss currently. CMA CGM had to dispose of such cargo at the requirement of the port authorities of Cotonou, and Yiwanda was invited to attend the disposal, while the absence of Yiwanda would be regarded as their acceptance of the whole process as well as the result of the disposal. On 7 January 2009, the consignee Mr. Elozona Okoli notified Yiwanda that as the cargo was damaged by flooding water during transportation, while the nature of the cargo was that the cargo would be damage if getting in contact with salty water, he hoped that Yiwanda could contact the carrier, while he would not make payment for the cargo and asked for re-producing the shoes. On 13 January 2009, CMA CGM Ningbo withdrew the whole set of original bills of lading from Yiwanda for claim settlement.
Subsequently, there are some email exchanges between the Plaintiff and the Defendants, between Yiwanda and North of England P&I Association, and between the agent at the destination port and the consignee. CMA CGM informed Yiwanda on 13 February 2009 that the claim documents had been delivered to the P&I club and requested Yiwanda to contact the P&I club directly. North of England P&I Association claimed on 17 February 2009 that it was surprised by the letter from CMA CGM China on 16 December 2008 and was making enquiries with the relevant persons of CMA CGM as to this email and their local correspondents as to whether the customs indeed required the disposal of cargo. On 11 March 2009, North of England P&I Association further notified that the container still remained at the port and had not been taken up to 21 March 2009, and the container would be seized and auctioned by the customs with the proceeds confiscated if the cargo was not collected, and Yiwanda was requested to take measures immediately.
This court holds that: this case is a dispute under contract of carriage of goods by sea, and the place of loading is Ningbo, so this court has jurisdiction over this case according to Article 28 of the Civil Procedure Law of the People¡¯s Republic of China. During the court hearing, both of the two parties agree that the Chinese law should apply, and according to Article 269 of the Maritime Code of the People¡¯s Republic of China, this case shall be subject to the laws of the People¡¯s Republic of China.
In the light of the claims and defences of the two parties, this court concludes and analyzes the issues under dispute as follows:
Firstly, in terms of the identification of carrier in this case, as CMA CGM Ningbo is a branch of CMA CGM China, they shall be deemed as the same legal entity; while CMA CGM China and CMA CGM are different legal entities. The bill of lading in this case shows that CMA CGM Ningbo, as the agent of CMA CGM, issued the bill of lading, and the cargo was carried by CMA CGM. During the court hearing, CMA CGM confirmed that it had entrusted CMA CGM Ningbo to issue the bill of lading and Yiwanda also claimed that CMA CGM was the carrier. According to the provision of Article 71 of the Maritime Code of the People¡¯s Republic of China that a bill of lading constitutes the evidence of the contract of carriage of goods by sea, CMA CGM shall be deemed as the carrier in this case. The acts of CMA CGM Ningbo or CMA CGM China are the acts of agency, of which the consequences shall be assumed by CMA CGM in accordance with Paragraph 2 of Article 63 of the General Principles of the Civil Law of the People's Republic of China.
Secondly, in respect of the compensation liability for the loss of cargo payment, according to Paragraph 1 of Article 46 of the Maritime Code of the People¡¯s Republic of China, the responsibilities of the carrier with regard to the cargo carried in containers covers the entire period during which the carrier is in charge of the cargo, starting from the time the carrier has taken over the cargo at the port of loading, until the goods have been delivered at the port of discharge. Yiwanda returned the original bills of lading at the request of CMA CGM Ningbo, while the cargo was still remained at the port till March 2009 and was seized and auctioned by the local customs, which constitutes the prima facie evidence of the carrier¡¯s failure to fully perform the contract of carriage of goods by sea. Even though the defence of the three Defendants turns out to be true, namely, the cargo was inspected immediately after the second leg vessel arrived at the port of Cotonou and the result showed that the cargo was in good condition and suitable for onward shipment, from the perspective of the chronological order of the facts, the two survey reports were issued on 26 November 2008 and 18 December 2008 respectively, however, CMA CGM China informed Yiwanda on 16 December 2008 that the cargo was in a status of total loss at that moment and withdrew the original bills of lading by reason of claim settlement on 13 January 2009. The inspection was prior to the notice of cargo loss and withdrawal of bills of lading, and the consignee had refused to make payment to Yiwanda for the cargo and asked for re-producing the shoes on 7 January 2009 according to the notice of cargo total loss from CMA CGM China. More than 50 days had passed since the cargo arrived at the port of Cotonou on 21 November 2008 till CMA CGM Ningbo withdrew the original bills of lading. Thereafter, under the circumstance that Yiwanda claimed for the loss, CMA CGM notified on 13 February 2009 that the claim documents had been delivered to the P&I club and requested Yiwanda to contact the P&I club directly. It is obvious that at least until that day, the three Defendants were still maintaining the previous declaration that the original bills of lading should be withdrawn for claim as a result of the cargo loss. There is no evidence to prove that CMA CGM has re-issued the bill of lading to Yiwanda or expressed clearly to Yiwanda that the notice of 16 December 2008 was incorrect, and the consignee might take delivery of the cargo by other means. As to whether the cargo was still suitable for delivery and why the Defendants first gave a notice of cargo total loss and withdrew the original bills of lading and then ran the arguments that the cargo was found by inspection in good condition during the subsequent correspondences and litigation, the three Defendants shall make reasonable explanation. Even if the cargo could be determined in good condition, the period of 60 days had expired since Yiwanda directly contacted the P&I club at the request of CMA CGM. According to Paragraph 4 of Article 50 of the Maritime Code of the People¡¯s Republic of China, Yiwanda can regard the cargo as lost. Even less the consignee has definitely refused to make payment for the cargo, the carrier shall assume the liability of compensation for the loss therefrom. To say the least, Yiwanda suffered from the consignee¡¯s refusal to take delivery of cargo and refusal to make payment for the cargo due to the mistaken notice and withdrawal of original bills of lading by CMA CGM China, according to Paragraph 2 of Article 60 of the Contract Law of the People¡¯s Republic of China, the carrier CMA CGM shall assume the liability of breach of contract for compensation for the loss suffered by Yiwanda therefrom.
In a summary, the claim of the Plaintiff Yiwanda that the Defendant CMA CGM should compensate the loss of cargo payment and freight is reasonable and shall thus be supported. However, the other charges shall be calculated in Renminbi. Its claim that CMA CGM China and CMA CGM Ningbo should assume joint and several liabilities is legally groundless which shall be rejected. The defence of the three Defendants that CMA CGM China and CMA CGM Ningbo shall not assume joint and several liabilities is reasonable and shall thus be accepted, while other defences shall not be accepted due to lack of evidence and ground. In accordance with Article 42 (1), Paragraph 1 of Article 46, Paragraph 4 of Article 50, Paragraph 1 and 2 of Article 55 and Article 269 of the Maritime Code of the People¡¯s Republic of China, Paragraph 2 of Article 63 the General Principles of the Civil Law of the People's Republic of China and Paragraph 2 of Article 60 of the Contract Law of the People¡¯s Republic of China, the Judgment is handed down as follows:
1. The Defendant CMA CGM S.A., France shall compensate the Plaintiff Yiwanda Shoes Co., Ltd. USD75,852 for the loss of cargo payment, USD2,800 for the loss of ocean freight and RMB2,870 for the loss of other charges within ten days after this Judgment comes into effect.
2. Reject the other claims of the Plaintiff Yiwanda Shoes Co., Ltd.
If the obligation of payment of money fails to be performed within the time limit specified by this Judgment, according to Article 229 of the Civil Procedure Law of the People¡¯s Republic of China, a double interest on the debt for the belated payment shall be paid.
The case acceptance fee of RMB9,710 shall be assumed by the Defendant CMA CGM S.A., France.
If dissatisfied with this Judgment, a Statement of Appeal can by submitted to this court for appeal to Zhejiang Higher People¡¯s Court by the Plaintiff Yiwanda Shoes Co., Ltd. and the Defendants CMA CGM (China) Shipping Co., Ltd. and CMA CGM (China) Shipping Co., Ltd. Ningbo Branch within 15 days upon service of the Civil Judgment, and by the Defendant CMA CGM S.A., France within 30 days upon service of this Civil Judgment, and copies of the Statement of Appeal shall be submitted in accordance with the numbers of the opposing party. [The Appellant shall prepay the appeal court fee in sum of RMB9,710 within 7 days after submitting the Statement of Appeal (the concrete amount is to be determined by Zhejiang Higher People¡¯s Court, and the overpayment will be returned later). Payment shall be remitted to the non-taxable income settlement account of Zhejiang Finance Department, the account number is 398000101040006575, the unit code is 515001 (to be filed in the Purpose Column), and the opening bank is Agricultural Bank of China Xihu Branch. Failure to make payment within the time limit shall be deemed as automatic withdrawal of the appeal.]
Presiding Judge : Wu Shengshun
People¡¯s Juror : Qian Xiaolou
People¡¯s Juror : Jiang Hui
Date: 10 June 2009
(Official Chop of Nngbo Maritime Court)
Certified True Copy
Clerk : Guo Lin¡¯ou