A sale agreement for 35 paper rolls was concluded between a seller in Italy and a buyer in Greece. The buyer then contracted with a freight forwarder to arrange the transportation of the goods from Italy to Greece. The freight forwarder contracted on behalf of the buyer with a Turkish carrier for sea carriage of the goods from La Spezia in Italy to Piraeus in Greece. The carrier provided two of its own empty containers to the seller's facilities for stuffing. The stuffed containers were delivered at the port for loading. The containers were loaded separately on vessels M and H under bills of lading which named the seller as the shipper and the freight forwarder as the recipient. The first container was unloaded from M in Piraeus on 1 June 2016 and the second container was unloaded from H in Piraeus on 16 June 2016. Both containers remained in the freight forwarder's facilities for 14 days prior to being delivered to the buyer's premises.

Both containers were insured against all risks. During carriage from the freight forwarder to the buyer, a strong odour was noticed. The insurer surveyed both containers and detected saturation by a foreign substance, despite the containers being sealed. Because traces of naphthalene were found on the samples of the paper rolls, the buyer claimed the full value of the goods due to a total loss. The insurer estimated the damage, after deducting the recycling value of the paper, at EUR 33,046.53, and was subrogated into the rights of the buyer after paying its insured.

The insurer then sued the carrier in the One Member Court of First Instance of Piraeus. The Court gave a default judgment in favour of the insurer in the carrier's absence. The carrier appealed Decision 1645/2020 of the One Member Court of First Instance of Piraeus to the One Member Court of Appeal of Piraeus.

Held: The Court of Appeal reconsidered the case and decided it on the merits. The plaintiff's claim was time-barred and therefore dismissed. The appeal was upheld and Decision 1645/2020 was annulled.

The Court found that the plaintiff insurer had standing to sue, as it was subrogated into the rights of the buyer.

The defendant carrier argued in its second ground of appeal that the Greek courts lacked jurisdiction in accordance with cl 5 of the bills of lading, which provided for the exclusive jurisdiction of the courts of Smyrna/İzmir in Türkiye. The Court held that this clause was invalid because the bills of lading were not signed by all the parties. Furthermore, the terms of the bills of lading were not applicable, because according to the facts the damage occurred during the land stage of the transport, which was not covered by the bills of lading. Therefore, this ground of appeal failed. The Court had jurisdiction to hear the case and Greek law will apply: 1) as the law with which the maritime transportation is most closely connected; and 2) for non-contractual (ie tortious) liability, as the law of the country in which the damage occurred (the lex loci delicti commissi).

The Court of Appeal reviewed the legal action in the light of arts 1.b, 1.e, 2, 3.1, 3.1b, 3.1.c, 3.2, 3.6, 4, 4.1, 4.5.b, 5, 7, 10, and 10.b of the Hague-Visby Rules and concluded the following.

Greece ratified the Hague-Visby Rules with the amending Protocols of 1968 and 1979 in Law 2107/1992 and the Rules are applicable in Greece since 23 June 1993. From arts 1.b, 2, 3.1, 5, and 10.b of the Hague-Visby Rules, it follows that they are applicable: a) to maritime transport in which the ports of loading and unloading are located in different States, when they are covered by a bill of lading or other similar document constituting a document of title for the carriage of goods by sea; and b) to maritime transport between Greek ports whether or not a bill of lading has been issued (Supreme Court Decision 343/2019 (CMI1384); Supreme Court Decision 376/2008 (CMI2414)).

Articles 3.1 and 4.1 establish the statutory objective liability of the carrier, in the sense that in the case of loss or damage to the cargo, the carrier has the burden of proving that it is not at fault. The classification of fault is similar to that of civil law in contractual liability ie the carrier is liable for fraudulent intent, gross negligence and ordinary negligence. Ordinary negligence means the failure of the average prudent carrier to exercise due care. The liability of the carrier concerns, in principle, loss of or damage to property, although this is not expressly mentioned in art 4 of the Hague-Visby Rules.

The only limitation is that the loss or damage must arise in connection with the loading, handling, stowage, carriage, custody, care, or discharge of the goods (art 2). According to art 1.e of the Hague-Visby Rules, carriage of goods by sea covers only the period of the maritime shipment, beginning with the loading of the goods and ending with their discharge. Thus the Rules do not cover the carrier's liability for stages of carriage beyond those two points, in respect of which the carrier may validly agree to a reduction or exemption from liability for loss or damage occurring during those stages (art 7). The burden of proving the existence of exculpatory facts lies with the defendant carrier, on the basis of the principle of strict liability in law.

Furthermore, the Hague-Visby Rules are applicable in Greece to pure (unimodal) international maritime transport under a bill of lading. In the case of combined international carriage, however, which is carried out by more than one mode of transport, but under a single contract (usually with a single bill of lading) covering the entire transport from receipt of the goods through to delivery of the goods to the consignee, the carrier's liability is not regulated uniformly. It is determined on the basis of the legal regime governing each part of the transport in which the damage occurred. Thus, if the damage occurred during the maritime stage of the transport, the Hague-Visby Rules will apply, whereas if it occurred during the land stage, the provisions of the CMR will apply. More specifically, if the damage occurred during an inland stage of the road transport, national law provisions will apply instead of the CMR.

The initial freight forwarder of the entire transport is liable, together with the carrier, for any delay, loss, or damage occurring at any point of the route and at the time of receipt, whether due to the actions or omissions of the contractual carrier or an actual carrier (Supreme Court in Plenary Session Decision 33/1998). Therefore, a party whose goods are damaged while being carried by road within the Greek territory may have contractual claims against its contractual counterpart, the freight forwarder. It may also have extra-contractual (tortious) claims arising from the culpable and unlawful conduct of the carrier, due to non-fulfilment of services due under the transport contract in a manner consistent with good faith.

Under national substantive and procedural law, the plaintiff's contractual claim, based on arts 1, 3.1.b, 3.1.c, 3.2, and 4.5.b of the Hague-Visby Rules, has a legal basis. However, there is no cumulative action in tort. On the facts of this case, the alleged unlawful and culpable conduct of the defendant carrier was not independent of its obligations under the maritime transport contract, The damage to the cargo occurred as a result of the defendant's breach of its contractual obligations.

It follows from arts 4.1 and 4.5.b of the Rules, that the sea carrier, in the event of loss or damage to the goods, is obligated to restore the value of the goods at the place and time of discharge. The value to be restored is the value ascertained by reference to the price of the goods on the commodity exchange; if there is no such price, the current market price is to be taken into account and, if there is no such price, the usual price for goods of the same kind and quantity is to be taken into account. In other words, the above provision establishes the measure for calculating compensation for the loss or damage caused by the loss or damage to the cargo. The compensation for loss or damage is due in domestic currency, regardless of whether the port of destination is abroad, or whether the insurer paid out in a foreign currency.

Article 3.6 of the Hague-Visby Rules contains a short-term annual limitation period, which begins from the delivery of the goods or from the date on which they should have been delivered. The Rules do not further specify anything regarding the interruption or suspension of the limitation period. The national law provisions establish a six-month limitation period after the insurer was subrogated into the insured's rights. This provision does not contradict the Rules, since it does not introduce a regulation different from it, but supplements it in a matter which is not regulated by it, and is thus in conformity with art 28.1 of the Constitution.

The insurer compensated the insured buyer on 28 July 2017. On the same day, the insured assigned its claim against the defendant to the plaintiff. But this subrogation did not take place before the time prescribed under art 3.6, given that the goods were delivered on 16 and 30 June 2016. Thus the contractual claim against the defendant carrier is time-barred, due to the lapse of one year from the delivery of the goods, and no claim accrues in this case in tort, which would allow the relevant action to be brought within three years.