Case of dispute over contract of carriage of goods by sea between COSCO Logistics (Guangzhou) Company Limited and CMA CGM (China) Shipping Co., Ltd. Shunde Branch

2016-05-17 16:05:51 BJT
Guangzhou Maritime Court of the People¡¯s Republic of China

¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡¡Civil Judgment (2010)GHFCZ No.10

Plaintiff : COSCO Logistics (Guangzhou) Company Limited
Address : 30th -32nd Floor, East Tower, Fortune Plaza, 116 East Tiyu Road,
Tianhe District, Guangzhou, China
Legal Rep. : Ma Jianhua, Employee of Company
Agent ad litem : Shen Hongwei, Lawyer from Geenen Foreign Legal Service
Center
Agent ad litem : Ren Lina, Paralegal from Geenen Foreign Legal Service Center

Defendant : CMA CGM (China) Shipping Co., Ltd. Shunde Branch
Address : Room 501-504, Hongjian Building, Ronggui Ave, No.2 South
Fengxiang Road, Shunde District, Foshan, China
Person in Charge : Zhu Liqing, General Manager of Shunde Branch
Agent ad litem : Zhao Shuzhou, Lawyer from Wang Jing & Co. Law Firm
Agent ad litem : Yang Bo, Lawyer from Wang Jing & Co. Law Firm

With respect to the case of dispute over contract of carriage of goods by sea lodged by the Plaintiff, COSCO Logistics (Guangzhou) Company Limited (hereinafter referred to as ¡°COSCO¡±) against the Defendant CMA CGM (China) Shipping Co., Ltd. Shunde Branch (hereinafter referred to as ¡°CMA Shunde¡±) on 7 December 2009, this Court accepted the case and then formed a collegiate bench accordingly to hear it. On 25 January 2010, the Plaintiff submitted an application to this Court requesting to join CMA CGM S.A (hereinafter referred to as ¡°CMA CGM¡±) to this lawsuit as a co-defendant. This Court ruled to dismiss the Plaintiff¡¯s application on 17 June. This Court convened both parties to exchange evidences on 28 July and 8 September and held a public court hearing. Shen Hongwei, the agent ad litem of the Plaintiff, Yang Bo, the agent ad litem of the Defendant attended the court hearings. Now the trial of this case has been concluded.

It was alleged by the Plaintiff, COSCO that on 5 December 2008, the Plaintiff accepted the entrustment of Shanwei Good Harvest Aquatic Products Co., Ltd (hereinafter referred to as ¡°SGHAP¡±) to carry the cargo laden in a 40¡¯ container from Yantian of Shenzhen to Miami of America. On the same day, the Plaintiff, in its own name, booked the cargo space from the Defendant who issued the booking confirmation to the Plaintiff after accepting the entrustment. On 12 December, both parties confirmed via email the information on the bill of lading: B/L No. was UH2130925, Container No. was TRLU1810852, cargo name was frozen tilapias, the shipper stated on the B/L was SGHAP, and the consignee was COSCO LOGISTICS (AMERICAS). INC (hereinafter referred to as ¡°COSCO (Americas)¡±). Both parties agreed that the cargo shall be released in accordance with their telex release instruction; thus, no original B/L was issued after the cargo was loaded. On 18 December, the Plaintiff paid the freight in amount of RMB 27,844.05 to Shunde Branch of Sinotrans Guangdong Co., Ltd. (hereinafter referred to as ¡°Sinotrans Shunde¡±) as per the Defendant¡¯s requirements. On 19 December, the Plaintiff and SGHAP executed the Telex Release Application (Letter of Guarantee) pursuant to the form provided by the Defendant and sent it to the Defendant by email, informing the Defendant to deliver the subject cargo to COSCO (Americas) at the destination port. On 25 December, the Defendant confirmed the content of the telex release application via email. In accordance with the information provided by the Defendant, the subject cargo arrived at the destination port on 9 January 2009, but the consignee COSCO (Americas) didn¡¯t receive the cargo arrival notice. Afterwards, it was understood that the subject cargo has been delivered to another party at the destination port. Therefore, SGHAP lodged a lawsuit against the Plaintiff and China Ocean Shipping Agency in June 2009, for requesting the aforesaid two parties to compensate the loss of subject cargo in amount of RMB601,360. On 23 December, the Plaintiff in this case compensated RMB481.000 (80% of the cargo value) to SGHAP through the mediation held by this Court. Subsequently, SGHAP issued a Letter of Subrogation to assign the right of claim for the subject cargo to the Plaintiff to facilitate Plaintiff to seek recourse from the party who is ultimately response for the loss. In summary, the Plaintiff requested the Court to order the Defendant to compensate the cargo loss in amount of RMB 601,360, freight payment RMB 27,844.05 and the interest thereon (the interest should be calculated from the date the Plaintiff actually paid the compensation to SGHAP to the date of payment of compensation to the Plaintiff at the overdue repayment interest rate as published by the People¡¯s Bank of China) and to order the Defendant to bear the court fee for this case.

The Plaintiff submitted the following evidences within the time limit for adducing evidence: 1. the booking note issued by the Plaintiff to the Defendant which proves the Plaintiff issued the booking note to the Defendant in December 2008 and the Plaintiff booked cargo space from the actual carrier, CMA CGM via the Defendant; 2. the booking confirmation issued by the Defendant to the Plaintiff which proves the Defendant issued the booking confirmation to the Plaintiff on the same day after receiving the Plaintiff¡¯s entrustment; 3. the B/L confirmation issued by the Defendant to the Plaintiff which proves the relationship of carriage and the details of carriage of the subject cargo; 4. the Telex Release Application issued by the Defendant to the Plaintiff which proves the Defendant forwarded to the telex release confirmation to the Plaintiff on 25 December, it was stated in the email that the consignee was COSCO (Americas); 6.the notarial document which proves Notary Public Office of Guangzhou has notarized the Evidence No. 4 and Evidence No. 5; 7. the customs declaration form for export which proves the value of subject cargo; 8. ICBC¡¯s advice of rejection which proves SGHAP failed to collect the cargo price via bank and the value of subject cargo; 9. the freight invoice which proves the Plaintiff has paid the freight of the subject cargo in amount of RMB 27,844.05; 10. the Letter of Subrogation issued by SGHAP which proves SGHAP assigned all the rights in the subject cargo to the Plaintiff; 11. the sales contract and the notarial certificate, the packing list and the notarial certificate, the commercial invoice and the notarial certificate with respect to the subject cargo provided by SGHAP which prove the value of subject cargo.

After the hearing, the Plaintiff supplemented the following evidences: 12. statement on failing to receive the cargo which proves COSCO (Americas) failed to receive the subject cargo; 13. container tracking record and the notarial certificate showing the empty container numbered as TRLU1810852 arrived at Rotterdam container yard on 2 September 2009 which prove the cargo has been picked up; 14. the Civil Mediation Award which proves with regard to the lawsuit lodged by SGHAP against the Plaintiff, both parties have reached a settlement through the mediation held by the Court; 16. the Plaintiff¡¯s illustration about the payment of freight which proves Sinotrans Shunde received the freight payment on behalf of the Defendant; 17. the invoice numbered as 01724153 provided by Sinotrans Shunde and the relevant remittance advices which prove the Plaintiff has paid the freight and Sinotrans Shunde received the freight on behalf of the Defendant.

It was defended by the Defendant, CMA Shunde that 1.The Plaintiff is not the shipper or consignee of the subject cargo and the right of subrogation claimed by the Plaintiff is lacking in legal basis. Therefore, the Plaintiff does not enjoy the right to sue or the right to claim damages based on the B/L; 2. The Defendant is not the carrier of the cargo under the subject cargo, but is merely the agent of the carrier. Thus there is no contract of carriage of goods by sea between the Defendant and the Plaintiff or the shipper. The claim raised by the Plaintiff against the Defendant based on the subject B/L has no factual or legal basis; 3. The Defendant has reasonably fulfilled its obligations as an agent with no negligence. The scope of agency does not cover delivery of cargo at the port of destination, thus the Defendant is not obliged to bear any liability for the wrongful delivery claimed by the Plaintiff; 4. The Plaintiff has not provided any evidence to prove that the Defendant or the carrier has committed any act of wrongful delivery of the cargo. The evidence provided by the Defendant proves that CMA CGM has already finished the cargo delivery with COSCO (Americas) at the destination port in accordance with the telex release instruction, and has never committed any act of wrongful delivery of cargo. The Plaintiff instructed the terminal to deliver goods without presentation of B/L due to its own fault, which has nothing to do with the Defendant and the carrier; 5. The Mediation Award and Receipts provided by the Plaintiff can only show that it has indemnified the shipper for 80% of the invoice value of the cargo. Under such circumstance, the Plaintiff can only claim compensation within the scope of the compensation it has actually made. Therefore, the lawsuit lodged by the Plaintiff for claiming the invoice value and the freight has no factual or legal basis.

The Defendant submitted the following evidences within the time limit for adducing evidence: 1. the agency agreement which proves the defendant was the agent of CMA CGM and responsible for accepting booking and arranging the carriage of the cargo while the scope of the agency does not cover cargo delivery; 2. the arrival notice issued by CMA CGM to COSCO (Americas) which proves CMA CGM notified the consignee who was stated on the B/L in time after the subject cargo arrived at the destination port; 3. the payment notice issued by CMA CGM to COSCO (Americas) which proves after the cargo arrived at the destination port, the consignee shall pay the customs exam fee for the cargo, and CMA CGM notified COSCO (Americas) to pay the customs exam fee; 4. the invoices for the expenses arising at the destination port issued by CMA CGM to COSCO (Americas) which proves CMA CGM has received the customs exam fee paid by COSCO (Americas); 5.the cargo release record of the subject container conducted by the cargo release electronic system-LARA at the destination port, the record proves the cargo has been delivered to COSCO (Americas) after receiving the notice of telex release and the customs exam fee; 6.the arrival notice sent by COSCO (Americas) which proves COSCO (Americas) received the arrival notice from CMA CGM and informed the consignee stated on the B/L.

After the cross-examination on evidence, the Defendant had no objection to the authenticity of Evidence No.1-8, Evidence No.11 and Evidence No.13-15, but did not admit other evidences. The Plaintiff did not admit all the evidences submitted by the Defendant. With regard to the evidences which are without dispute, the collegiate panel admits the probative force. Evidence No.10 submitted by the Plaintiff was the original copy and it corroborated the aforesaid evidences which with the probative force, thus the collegiate panel also admits its probative force. Evidence No.1 submitted by the Defendant was the original copy, the Plaintiff only raised objection to it but failed to submit evidence to rebut it, thus, the collegiate panel also admits its probative force.

Through the review and ascertainment of the aforesaid evidences, and combining with the hearing and investigation, the fact findings of this case are as below:

In November 2008, SGHAP and O CEAN BREEZE SEAFOOD concluded the sales contract numbered as GHXS0812; the agreed cargo was 44,000 pounds of frozen tilapias (laden in a container), 3/5 ounce of frozen tilapias were laden in 1,760 cartons while 5/7 ounce of frozen tilapias were laden in 2,640 cartons; the price terms was CFR Miami of America and the cargo was in total amount of USD88,167. The port of loading was a port in China while the destination port was Miami of America. The payment term was Documents against Payment at sight. On 4 December, SGHAP issued the commercial invoice numbered as 08050 to OCEAN BREEZE SEAFOOD and explicitly indicated the total price of the cargo was in amount of USD 88,167. The packing list issued on the same day stated that the B/L No. was PENA4201296; the cargo was 1,760 cartons of 3/5 ounce of frozen tilapias and 2,640 cartons of 5/7 ounce of frozen tilapias. The container No. recorded on the aforesaid invoice and packing list was TRLU1810852.

On 5 December, COSCO Logistics (Guangzhou) Company Limited Foshan Branch (hereinafter referred to as ¡°COSCO Foshan¡±) issued the booking note to the Defendant. This booking note was the standard form provided by CMA Shunde, the heading was ¡°The booking note of CMA Shunde¡±. The recorded booking party was COSCO Foshan, the shipper was SGHAP, the consignee was ¡°To Order¡±; the place of receipt and the port of loading was Yantian, the port of discharge and the place of delivery was Miami of America; the cargo was frozen tilapias in gross weight of 18,800 kilograms; the shipper was responsible for trucking fees and wharfage, the ocean freight was prepaid; one 40¡¯ freezer; telex release was stipulated by the B/L; it was stated that ¡°in case SWB is issued, then the off-site payment is not allowed, and money shall be paid to CMA Shunde¡±. COSCO Foshan affixed its special seal for business on the booking note. On the same day, the Defendant issued the booking confirmation and the heading was the Defendant¡¯s name (CMA Shunde); the shipper/freight forwarder was COSCO Foshan, the booking note No. was USH130925, the carrying vessel was CMA CGM NEW JERSEY and the voyage No. was PX509E.

On 12 December, the Defendant issued the draft B/L in Shunde, and the draft B/L was on the B/L form of CMA CGM, the B/L No. was UH2130925, the shipper was SGHAP, the consignee and the notify party was COSCO (Americas); the cargo was one 40¡¯ freezer, the container No. was TRLU1810852 in which 4,400 cartons of frozen tilapias were laden; the freight was prepaid at Shunde; the cargo was delivered FCL/FCL; the column of ¡°Issue on behalf of CMA CGM¡± was in blank.

On 18 December, SGHAP issued the bill of exchange to OCEAN BREEZE SEAFOOD for requesting it to pay USD 88,176 (the amount under the commercial invoice numbered as 08050) at sight to CIBC.

COSCO Foshan sent an email to the Defendant, to which the Telex Release Application was enclosed, which recorded: To CMA CGM, the date was 19 December, COSCO Foshan applied to deliver the cargo (under the B/L numbered as UH2130925 which under the voyage numbered as PX509E) to COSCO (Americas) by means of telex release at the destination port; and it stated ¡°the original B/L has been submitted by the Defendant¡­the total value of the aforesaid cargo is in amount of USD 91,056 which has been paid to us; thus, we apply to directly deliver the aforesaid cargo to COSCO (Americas)¡±, SGHAP affixed its seal on the Telex Release Application.

On 25 December, the Defendant sent email to CMA CGM USA/IMPORT and instructed: whereas the full set B/L has been received, with regard to the cargo laden in the container numbered as TRLU1810852 under the B/L numbered as UH2130925, please urgently release the cargo to the consignee-COSCO (Americas) without production of B/L. The Defendant forwarded this email to the Plaintiff.

On 4 January 2009, Shanwei Customs issued the customs declaration form for export numbered as 603120080318502092 which stated the shipper was SGHAP; the port of discharge was Miami of America; the payment term was Documents against Payment; the terms of delivery was C&F; the contract number was GHXS08050; the cargo was in gross weight of 22,220 kilograms while in net weight of 19,976 kilograms; the container number was TRLU1810852; the cargo was laden in 4,400 cartons, the value of 3/5 ounce of frozen tilapias was in amount of USD 34,320 while the value of 5/7 ounce of frozen tilapias was in amount of USD 53,856, the total value of the cargo was in amount of USD 88,176. The customs declaration form was affixed with SGHAP¡¯s special seal for customs declaration and Shanwei Customs¡¯ verification seal.

Both parties confirmed that the subject cargo was shipped to the port of discharge-Miami on 9 January.

On 11 March, ICBC Shanwei Branch issued the advice of rejection which shows OCEAN BREEZE SEAFOOD rejected to pay USD 81,576 under the commercial invoice numbered as 08050.

On 14 October, the Plaintiff tracked the movement of the container numbered as TRLU1810852 on the official website of CMA CGM, and the result showed this container was released at Rotterdam container yard on 2 September 2009.

In addition, in accordance with the agency agreement submitted by the Defendant, on 27 June 2001, CMA CGM and CMA CGM (China) Shipping Co., Ltd. concluded the agency agreement. Both parties agreed that CMA CGM (China) Shipping Co., Ltd. is the agent of CMA CGM in Shanghai, Ningbo Port, Zhejiang Province, Xiamen, Shenzhen, Qingdao, Dalian and Tianjin/Xingang, as well as being responsible for paying (without any deduction) all the due freight and other fees for each voyage (for instance, the prepaid freight, terminal operation charges, demurrage charges and any other fees applicable to export transportation as well as import fees, demurrage charges and any other applicable fees which are to be charged ) to CMA CGM. The agency agreement came into effect on 1 July 2001 and shall remain effective; however, either party can terminate the agreement at any time upon issuing to the other party a notice 90 days in advance.

Furthermore, in accordance with the investigation, SGHAP filed a lawsuit with this Court in June 2009 and alleged that it concluded the cooperative agreement with COSCO Foshan in September 2008, and they agreed that the Plaintiff in this case shall accept to carry SGHAP¡¯s cargo or the cargo agented by SGHAP and issue B/L. On 12 December of the same year, China Ocean Shipping Agency issued B/L numbered as PENA4201296 with respect to the shipping of subject cargo. However, the subject cargo was released at the destination port by the carrier without SGHAP¡¯s instruction which caused SGHAP suffered a direct economic loss in amount of RMB 601,360. The court was requested to order the Plaintiff and China Ocean Shipping Agency to compensate the subject cargo loss in amount of RMB 601,360. Subsequently, the parties reached a settlement through the mediation held by the Court, namely, the Plaintiff compensated 80% of the cargo value to SGHAP, and SGHAP issued Letter of Subrogation to assign the right of claim for the subject cargo to the Plaintiff, and the Plaintiff can claim against the actual person who is liable for the damages. On 11 December 2009, SGHAP issued a Letter of Subrogation to assign all the rights with respect to the cargo under B/L numbered as UH2130925 to the Plaintiff, and the legal representative-Zhong Yongqiang signed and affixed SGHAP¡¯s official seal on the Letter of Subrogation. On 23 December, the Capital Planning Department of the Plaintiff issued the payment order numbered as APP091247036 for entrusting the Business Department of Guangzhou Branch of China Merchants Bank to remit RMB 481,000 to SGHAP, and attached the Civil Mediation Award numbered as (2009) GHFCZ No. 355. On the same day, China Merchants Bank affixed the verification seal on the payment slip numbered as E69005004667130, and SGHAP issued the voucher to prove the aforesaid payment has been received.

With regard to the facts in dispute, the collegiate panel ascertained as below:

1. The value of the subject cargo and the ocean freight

The Plaintiff alleged the value of the subject cargo was in amount of RMB 601,360 and the loss of freight was in amount of RMB 27,844.05. The Defendant had no objection to the value of the subject cargo, but asserted the Civil Mediation Award numbered as GHFCZ No. 355 proves that the Plaintiff had reached a settlement with SGHAP by compensating the latter the amount of RMB 481,000; thus, the Defendant asserted that the Plaintiff¡¯s current claim lacks legal basis. The collegiate panel holds that the aforesaid adopted evidences (customs declaration form for export, sales contract, commercial invoice, etc.) are sufficient to prove the total value of subject cargo was in amount of USD 88,176, the price terms was CFR, the aforesaid total value of subject cargo has contained the freight (with respect to transporting the subject cargo) paid by the Plaintiff. The value of the subject cargo was recorded in USD. The Plaintiff alleged the value of subject cargo was in amount of RMB 601,360 and the Defendant had no objection, the collegiate panel confirms the value of the subject cargo was in amount of RMB 601,360. The Plaintiff has reached settlement (namely, by compensating RMB 481,000) with SGHAP in the aforesaid case and resolved all the disputes between it and SGHAP. The collegial panel ascertains the actual loss suffered by the Plaintiff shall be in amount of RMB 481,000.

The Plaintiff held that it has paid the freight in amount of RMB 27,844.05 to Sinotrans Shunde as per the Defendant¡¯s requirements, and Evidence No. 9 and Evidence No.17 have been submitted. The two evidences stated that on 16 December 2008, Sinotrans Shunde issued forwarder¡¯s freight invoice numbered as 01724153 to COSCO Foshan, the invoice amount was RMB 27,844.05, B/L No. was USH130925, the sailing date was 18 December 2008, the port of loading was Yantian, the destination port was Miami of America, the container No. was TRLU1810852. On 18 December, COSCO Foshan effected the payment stated in the invoices (No.01724153, 01724155, 01724088) to Sinotrans Shunde via Foshan Branch of Bank of China. The Defendant raised no objection to the authenticity of the invoice, but it rebutted that although the container No. recorded on the aforesaid invoice was consistent with the container No. in this case, the B/L No.USH130925 recorded on the aforesaid invoice was different from the B/L No.UH2130925 in this case. Moreover, the invoice was issued by Sinotrans Shunde and shall be irrelevant to this case. The collegiate panel holds that the B/L No. recorded on the aforesaid invoice was consistent with the booking note No. for the subject shipment. Furthermore, the sailing date, the port of loading, the destination port and the container No. were consistent with the subject cargo. Therefore, the Defendant¡¯s allegation that the invoice was irrelevant to this case is not correct. Moreover, the Defendant, as the party for accepting booking and arranging shipping of cargo, should has known the relevant facts with respect to freight collection, but the Defendant failed to provide the facts to the Court; thus, the collegiate panel admits the Plaintiff¡¯s representation that they had paid the freight in amount of RMB 27,844.05 to Sinotrans Shunde.

2. Whether the Defendant has delivered the cargo to COSCO (Americas)

The Plaintiff asserted that the consignee on the B/L failed to receive the cargo at the destination port, and presented as proof a statement issued by COSCO (Americas) on August 5, 2010, which reads¡°In respect of the cargo (its shipper is SGHAP, the carrier is CMA, the container number is TRLU1810852, and the number of B/L is UH2130925), we as the consignee received a notice of arrival from CMA in January 2009, but were told the cargo had been taken when we were preparing to go through the procedures of taking delivery. Up to now, we haven¡¯t received the cargo from CMA and haven¡¯t paid any port fees to CMA.¡± The Defendant asserted the Plaintiff¡¯s evidence is not valid, stating the Plaintiff failed to evidence that the Defendant or the actual carrier mis-delivered the cargo, and provided Evidence NO. 205 to prove the carrier had performed its duties. Evidence NO. 2-4 provided by the Defendant says CMA CGM sent a notice of arrival to COSCO (Americas) on December 30, 2008, notifying ¡°CMA CGM NEW JERSEY PX510W is estimated to arrive on January 9, 2009¡± and requiring the consignee to go through the procedures of customs declaration for the cargo under the B/L UH2130925. On January 8, 2009, CMA CGM sent a debit note requiring the consignee to pay customs inspection fee of USD 160.00. On the same day, CMA US issued an invoice numbered NAIM1263913 on which the payer is COSCO (Americas) and the amount is USD 160.00, a B/L numbered UH2130925 and an application for shipment numbered USH130925. All the three documents haven¡¯t been stamped or confirmed by the consignee. The cargo release record in Evidence NO. 5 shows CMA CGM released the cargo on January 12, 2009, but didn¡¯t include the consignee¡¯s stamp or confirmation. The Plaintiff did not confirm the above evidence produced by the Defendant.

The collegiate panel holds that the above evidential documents are not admitted because the Plaintiff and the Defendant failed to produce the originals and they refused to confirm the opposing party¡¯s evidence. In this case, the Plaintiff asserts that the consignee didn¡¯t receive the cargo involved in the case and has provided the container tracking record to this Court to evidence the subject container has been circulated as an empty container. Since the subject cargo was intended to be delivered in a full container, this tracking history could prove the cargo has been released. As the party responsible for arranging the transport, the Defendant should know more about the cargo status in the destination port than the Plaintiff. Therefore, the Defendant shall bear the burden of proof in respect of the delivery to the consignee at the destination port. Since the Defendant alleged the cargo had been delivered to COSCO (Americas), yet failed to produce proof, the Defendant shall be responsible for the failure of producing proof. Therefore, the Defendant¡¯s allegation lacks factual basis and is not admitted.

Both parties expressly choose to apply the law of People¡¯s Republic of China during the trial.

The members of the collegiate panel unanimously hold that: this is a case of dispute over contract of carriage of goods by sea, and according to Article 1 of the Maritime Procedure Law of the People's Republic of China and Article 11 of the Provisions of The Supreme People¡¯s Court for the Scope of Cases Handled by Maritime Courts, this case shall be under the jurisdiction of Maritime Court. According to Article 28 of Civil Procedure Law of the People¡¯s Republic of China, a lawsuit arising from a dispute over a transport contract shall be under the jurisdiction of the people's court of the place of dispatch or the place where the Defendant has its domicile, and in this case, the place of dispatch and the place where the Defendant has its domicile are both under the jurisdiction of this Court. Therefore, this Court shall have jurisdiction to hear this case. Since both parties expressly choose to apply the law of People¡¯s Republic of China during the trial, and according to Paragraph 1, Article 4 of the Provisions of The Supreme People¡¯s Court for Trial of a Case of Dispute over Civil or Commercial Contracts involving Foreign Interests, this case shall be governed by laws of P.R.C.

The Plaintiff claims that since SGHAP and the Defendant are parties to the contract of carriage of goods by sea, and SGHAP transferred the right of claims to the Plaintiff subsequent to the compensation made by the Plaintiff to SGHAP, the Plaintiff shall thus enjoy the right to claim against the Defendant. The Defendant argued that the Plaintiff¡¯s claim in respect of the transfer of the right of claims is not tenable, because the Plaintiff is not the shipper, the Defendant is not the carrier, and no contract of carriage of cargo by sea between the Plaintiff and the Defendant existed. According to Article 71 of Maritime Code of the People's Republic of China, A bill of lading is a document which serves as an evidence of the contract of carriage of goods by sea and the taking over or loading of the goods by the carrier, and based on which the carrier undertakes to deliver the goods against surrendering the same. A provision in the document stating that the goods are to be delivered to the order of a named person, or to order, or to bearer, constitutes such an undertaking. In this case, the Plaintiff as the booking party sent a booking note to the Defendant, and the Defendant in its own name sent a booking confirmation to the Plaintiff confirming the contract of carriage of cargo by sea. Therefore, both parties completed a valid offer and an undertaking, and the following draft B/L further specified both parties¡¯ rights and obligations. During the performance of the contract, the Defendant required the Plaintiff to send an application for telex release, and this application showed that the addressee is CMA CGM, so the actual carrier is CMA CGM. During proceedings, the Agency Agreement presented by the Defendant expressly showed that it is the agent of the actual carrier CMA CGM. According to Paragraph 2 of Article 403 of Contract Law of the People¡¯s Republic of China, Where the agent failed to perform its obligation toward the third person due to any reason attributable to the principal, the agent shall disclose the principal to the third person, allowing the third person to select in alternative either the principal or the agent as the other contract party against whom to make a claim, provided that the third person may not subsequently change its selection of the contract party. The Plaintiff in this case may choose the Defendant as the other contract party against whom the Plaintiff claims its rights under the contract of carriage of cargo by sea. In conclusion, the Plaintiff entrusted the Defendant with the carriage of the cargo and has paid the relevant fees, and the Defendant accepted the Plaintiff¡¯s entrusting, so a contract of carriage of cargo by sea between the Plaintiff and the Defendant is established. The contract which is based on both parties¡¯ true will is legitimate and valid and shall have binding force on both parties.

According to Paragraph 1 of Article 46, the responsibilities of the carrier with regard to the goods carried in containers covers the entire period during which the carrier is in charge of the goods, starting from the time the carrier has taken over the goods at the port of loading, until the goods have been delivered at the port of discharge. Unless as otherwise agreed, it¡¯s the carrier¡¯s obligation to deliver the cargo to the consignee under the contract of carriage of cargo by sea. The Defendant failed to prove that it delivered the cargo to the consignee as agreed, and the Plaintiff compensated for the loss of the cargo. According to Article 107 of the Contract Law of People¡¯s Republic of China, Types of Liabilities for Breach, if a party fails to perform its obligations under a contract, or rendered non-compliant performance, it shall bear the liabilities for breach of contract by specific performance, cure of non-conforming performance or payment of damages, etc. Based on the ascertained facts, the Plaintiff¡¯s actual loss amounts to RMB 481,000.00, and the Plaintiff¡¯s claim that the loss of cargo shall be compensated shall be supported. The Plaintiff¡¯s claim that the loss of cargo shall be subject to the interest counting from December 23, 2009 when the Plaintiff actually made compensation to SGHAP shall be supported. But the Plaintiff¡¯s claim that the interest rate shall be subject to the interest rate for late payment prescribed by People¡¯s Bank of China lacks sufficient facts and thus can¡¯t be supported. The interest rate shall be subject to the current benchmark interest rate of RMB loan published by People¡¯s Bank of China. The settlement amount of RMB481,000 effected by the Plaintiff represents a package deal for the claim for the full value of the cargo amounting to RMB 601,360.00 and the freight the Plaintiff paid. Therefore, the Plaintiff¡¯s claim that the Defendant shall reimburse additionally the freight payment of RMB 27,844.05 and the relevant interest lack basis and thus is not supported.

In conclusion, according to Article 107 and Paragraph 2 of Article 403 of the Contract Law of the People¡¯s Republic of China as well as Paragraph 1 of Article 46 of the Maritime Code of the People¡¯s Republic of China, this Judgment is hereby rendered as follows:

1. the Defendant CMA Shunde shall compensate Cosco Logistics (Guangzhou) Company Limited the amount of RMB 481,000.00 plus interest (subject to the current benchmark interest rate of RMB loan published by People¡¯s Bank of China and counted on the basis of a period from December 23, 2009 to the date of payment ascertain in this judgment);
2. other claims by Cosco Logistics (Guangzhou) Company Limited are dismissed.


The payment obligation shall be fulfilled within ten (10) days from the date when this judgment becomes effective, failing which the interest on the debt for late fulfillment shall be paid twice as much as the original amount according to Article 229 of the Civil Procedure Law of People¡¯s Republic of China.

The court cost of this case is RMB 10,535.00, of which the Plaintiff shall pay RMB 2,109.00 and the Defendant shall pay RMB 8,426.

Any party who is dissatisfied with this judgment has the right to submit to this court the statement of appeal, and the copies of thereof in accordance with the number of the other parties, within 15 days of the service of this judgment, for appealing before the Guangdong Higher People¡¯s Court.¡¡


Presiding judge : Deng Yufeng
Judge : Song Ruiqiu
Acting judge : Chang Weiping
Clerk : Zhu Mingfang

August 20, 2012
(Guangzhou Maritime Court)
Certified as true to the original



The translation is provided by Wang Jing & CO.






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