Geofizika DD v MMB International Ltd

Geofizika DD v MMB International Ltd

MMB breached its CIP obligations by permitting a contract of carriage that allowed on-deck shipment and by procuring insurance with an under-deck warranty that did not match the carriage contract. GSC, as freight forwarder, failed to exercise reasonable skill and care by not verifying the carriage arrangements and by giving an unconditional under-deck warranty without sufficient evidence. Limitation of liability under BIFA does not apply to this breach. Geofizika is entitled to damages for the insured value of the lost vehicles, reasonable hire costs, and legal costs, less the settlement received from the carrier.

Parties
Claimant: Geofizika DD; Defendant: MMB International Limited; Third Party: Greenshields Cowie & Co Limited
Jurisdiction
England and Wales
Judgment Date
10 July 2009
Procedural Posture
Commercial Contract Dispute / Judgment After Trial
Outcome
Claim by Geofizika against MMB succeeds; MMB's claim against GSC succeeds.
Legal Topics
CIP Contracts, INCOTERMS 2000, Carriage of Goods by Sea, Freight Forwarding Liability, Insurance Obligations Under Sale Contracts, Limitation of Liability Under BIFA Terms
Commercial Law International Trade Carriage of Goods Insurance Law CIP Contracts INCOTERMS 2000 Carriage of Goods by Sea Freight Forwarding Liability +2 more

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Parties

Geofizika DD

Claimant

MMB International Limited

Defendant

Greenshields Cowie & Co Limited

Third Party

Procedural Posture

Commercial Contract Dispute / Judgment After Trial

Legal Issues

  1. 1 Whether MMB breached its obligations under a CIP contract to procure a proper contract of carriage and matching insurance
  2. 2 Whether GSC, as freight forwarder, breached its duty of reasonable skill and care in arranging carriage and insurance
  3. 3 Whether the insurance policy matched the contract of carriage and responded to the loss

Ratio Decidendi

MMB breached its CIP obligations by permitting a contract of carriage that allowed on-deck shipment and by procuring insurance with an under-deck warranty that did not match the carriage contract. GSC, as freight forwarder, failed to exercise reasonable skill and care by not verifying the carriage arrangements and by giving an unconditional under-deck warranty without sufficient evidence. Limitation of liability under BIFA does not apply to this breach. Geofizika is entitled to damages for the insured value of the lost vehicles, reasonable hire costs, and legal costs, less the settlement received from the carrier.

Court Disposition

Claim by Geofizika against MMB succeeds; MMB's claim against GSC succeeds.

Orders

  • Geofizika to recover damages for the insured value of two lost ambulances, reasonable hire costs up to 31 March 2007, and uncontroversial smaller items, less £50,000 received from Brointermed and less £9,000 for legal costs.
  • If parties cannot agree on damages, court will assess outstanding items at hand-down.