This case has now been reported in full in The Weekly Law Reports as British American Tobacco Switzerland v Exel Europe Ltd [2015] 3 WLR 1173, SC(E).
CARRIAGE BY LAND — International carriage of goods by road — Jurisdiction — Contracts of carriage between goods owners and English primary carrier containing exclusive English jurisdiction clause — Contracts of carriage performed by Dutch subcontractors — Consignment notes not identifying exclusive jurisdiction clause — Consignments lost in transit in mainland Europe — Goods owners bringing proceedings against primary carrier and subcontractors — Whether English court having jurisdiction over claims against subcontractors —  Carriage of Goods by Road Act 1965, Sch, arts 31.1, 34. 36 — Council Regulation (EC) No 44/2001, arts 6(1), 71(1)

British American Tobacco Switzerland SA and others v Exel Europe Ltd and others

British American Tobacco Denmark A/S and others v Exel Europe Ltd and another

[2015] UKSC 65; [2015] WLR (D) 430

SC: Lord Neuberger of Abbotsbury PSC, Lord Mance, Lord Clarke of Stone-cum-Ebony, Lord Sumption, Lord Reed JJSC: 28 October 2015

The fact that the English court had jurisdiction under article 31.1 of the Convention on the Contract for the International Carriage of Goods by Road (“CMR”), set out in the Schedule to the Carriage of Goods by Road Act 1965, to entertain an action against one of a series of carriers of the same goods did not enable successive carriers of those goods, in respect of whom the court did not otherwise have jurisdiction under article 31.1, to be joined in the same proceedings.

The Supreme Court held in allowing appeals by subcontractors against the order of the Court of Appeal (McFarlane LJ, Sir Bernard Rix, and Sir Timothy Lloyd) [2014] 1 WLR 4526; [2013] WLR (D) 417 whereby it had allowed appeals by the claimant cargo owners against the order of Cooke J [2013]1 WLR 397; [2012] WLR (D) 98 setting aside on the grounds of lack of jurisdiction their claims in two sets of proceedings: (1) in the first appeal by British American Tobacco Switzerland SA, British American Tobacco (Supply Chain WE) Ltd and BAT (UK and Export) Ltd against, inter alia, the second defendants, H Essers Security Logistics BV, and the fourth defendants, H Essers Transport Co Nederland BV, for damages for the loss of a consignment of tobacco in the course of carriage by road from Switzerland to The Netherlands; and (2) in the second appeal, by British American Tobacco Denmark A/S, British American Tobacco (Supply Chain WE) Ltd and BAT (UK and Export) Ltd against, inter alia, the second defendants, Kazemier Transport BV, (together with the second and fourth defendants in the first appeal: “the subcontractor defendants”) for damages for the loss of a consignment of tobacco in the course of carriage by road from Hungary to Denmark.

By article 31.1 of the CMR : “In legal proceedings arising out of carriage under this Convention, the plaintiff may bring an action in any court or tribunal of a contracting country designated by agreement between the parties and in addition, in the courts or tribunals of a country within whose territory (a) the defendant is ordinarily resident, or has his principal place of business, or the branch or agency through which the contract of carriage was made, or (b) the place where the goods were taken over by the carrier or the place designated for delivery is situated, and in no other courts or tribunals.”
The claimants were all members of a group of companies which had long-term contracts with the first defendant, an English registered company, for the distribution of the group’s products in Europe. The contracts recognised that the CMR applied, and provided for English law to apply to the contracts and for disputes to be submitted to the exclusive jurisdiction of the English courts. In each of two cases the carriage of a consignment of tobacco owned by one of the claimants was performed by the Dutch subcontractor defendants pursuant to subcontracts between them and the first defendant, with the relevant consignment notes not identifying the exclusive jurisdiction clause. In each case the consignment was allegedly stolen in transit. The claimants issued proceedings in the High Court against both the first defendant and the subcontractors. The first defendant, being bound by the exclusive jurisdiction clause, accepted English jurisdiction but the subcontractor defendants applied for service of the claim forms on them to be set aside on the ground that the English court did not have jurisdiction over them since they were outside the terms of article 31.1. The claimants argued, inter alia, that (1) the subcontractor defendants were within article 31.1 because article 34 of the CMR made subsequent carriers parties to the original contract of carriage and so party to the claimants’ and first defendants’ exclusive jurisdiction clause; and (2) article 31.1 was to be read with the final words of article 36 of the CMR (which, having specified the categories of carriers against whom proceedings for loss, damage or delay could be brought, provided that an action could be brought at the same time against several of them) as permitting joinder of successive carriers in the specified categories to any action against the primary carrier where the court had jurisdiction over that carrier pursuant to article 31.1.

LORD MANCE JSC (with whom LORD NEUBERGER OF ABBOTSBURY PSC and LORD REED JJSC agreed) said that since the subcontractor defendants were successive carriers within article 34 it followed that they became party to the respective contract or contracts of carriage made between the claimants and first defendant. If the matter had stopped there, that would on the face of it have meant party to those contracts whatever their terms. But article 34 qualified the position, by adding that a successive carrier became party to the contract of carriage “under the terms of the consignment note”. The subcontractor defendants, whose consignment notes did not refer to the claimants’ and first defendant’s jurisdiction clause, therefore could not be joined as a party in England on that ground. Moreover, it would be contrary to general principle to hold a successive carrier bound by a choice of court clause, or any other contractual clause not evidenced by the consignment note, of which he had no express notice. To do so would involve an unfamiliar and undesirable invasion of the general principle that contract depended on agreement. As to the argument that article 31.1 was to be read with the closing words of article 36, the purpose of those words was to make clear that the liability of the first, last carrier and performing carriers was joint and several, and not alternative. They were not to be read as conferring jurisdiction which did not otherwise exist within the terms of article 31.1. The heads of jurisdiction were to be found in article 31.1 and, as its closing words stated, “in no other courts or tribunals”.

LORD CLARKE OF STONE-CUM-EBONY and LORD SUMPTION JJSC delivered concurring judgments.

Appearances

John Passmore QC (instructed by Holman Fenwick Willan LLP) for the subcontractor defendants.
Charles Priday and Benjamin Parker (instructed by Gateley LLP) for the claimants in both proceedings; the first defendant did not appear and was not represented.

Reported by: Colin Beresford, Barrister.

© 2015. The Incorporated Council of Law Reporting for England and Wales.