This was a claim brought by FIT LLC (the claimant) against MMTP PJSC (the defendant) for damage to cargo caused during unloading. Polus Magadan JSC (the buyer) concluded a CIF sales agreement with Flender GmbH (the seller) for equipment. The seller organised the carriage. The seller contracted with a freight forwarder, Fracht FWO AG (Germany) (Fracht), to organise the cargo's transportation to the destination port, Magadan, Russia. Fracht, in turn, hired a second freight forwarder, RTL-Ural LLC (RTL), to organise the carriage from Pusan to the destination port. RTL hired a further freight forwarder, Kompaniya Transservice LLC (Transservice), to organise transportation from Vladivostok to Magadan. Transservice agreed on the carriage of goods with the claimant. The claimant, in turn, used the defendant's services for unloading the cargo in the destination port. During unloading, the cargo fell from its sling onto the berth. The cargo was considered a total loss. The buyer removed the cargo from the port and left it in its warehouse as scrap since it could not be used or sold abroad due to Russian restriction measures.

The cargo was insured by W Droege Assekuradeur GmbH (Droege). Droege paid the insured seller EUR 1,316,393.73. The rights of the seller were subrogated to Droege. Droege brought a claim against Fracht, whose liability was insured by Basler SA (Basler). Basler paid Droege EUR 174,954.21, taking into account the limitation of liability provided by the Hague-Visby Rules. As a result of subrogation, Basler brought a claim against RTL. RTL, in turn, brought a claim against Transservice. Transservice brought a claim against the claimant. The claimant sought an indemnity from the defendant. The claimant argued that the damage to the cargo was caused by the defendant’s actions and breach of the technical rules of cargo unloading. The claimant assumed that its liability to Transservice would be EUR 174,954.21 and direct tortuous liability in the amount of EUR 1,141,439.52 to Droege. Also, it claimed RUB 3,051,775 for the freight as the lost profit, USD 16,200 for the value of the cargo transportation from Pusan to Vladivostok, and RUB 163,200 for the cost of unloading in the port of Magadan.

The Court of first instance dismissed the claim. It concluded that the claimant has not yet suffered any damages from the event and, therefore, had no claim against the defendant yet. Moreover, the claimant failed to prove the set of facts needed to find the defendant liable for damages. The claimant appealed. The Court of Appeal upheld the claim partially. The Court commissioned an expert evaluation and, based on the expert opinion, found that the defendant was liable for the damage to the cargo. However, the Court of Appeal dismissed the claim for EUR 1,141,438.52. The Court of Appeal concluded that the claimant would not bear any tortuous liability to Droege since it was not the party whose actions caused the damage. Therefore, this part of the claim was dismissed.

The defendant submitted a cassation appeal. It argued against the expert opinion and said that the claim was time-barred since, for this type of claim, the Merchant Shipping Code of Russia (the MSC RF) provides for a special one-year prescription period. Moreover, it submitted that the cargo could be considered lost since the buyer took it from the port and obtained ownership of the cargo. Also, it argued that the claimant's liability was limited since it was the carrier. Therefore, it could not bear liability in the form of loss of profit.

Held: The cassation appeal is dismissed

The Court rejected the defendant's argument regarding the expert opinion. As for the prescription period, it concluded that the claims were covered by the special prescription period provided by art 408 of the MSC RF and art 25(6) of Federal Law No 261-FZ. The relevant arts apply to the claims arising out of the contract of carriage. The same prescription period is provided by art 797(3) of the Civil Code of Russia (the CC RF). The running of the period starts on the day of the event that caused the damage. However, art 25 of Federal Law No 261-FZ provides that the terminal operator is obliged to consider a pre-trial claim within 30 days. The running of the prescription period is paused for this period. The incident occurred on 19 November 2021, and the claim was submitted on 16 December 2021 within the period of one year and 30 days after the incident. Therefore, the claim was not time-barred.

The Court dismissed the defendant's submission that the cargo was not lost since title in the goods passed to the buyer. First, the Court concluded that the mere fact that the cargo was taken by the buyer does not mean that it was not totally lost without any additional circumstances. Second, the Court held that the goods were never transferred to the buyer under the sale and purchase agreement. Therefore, the seller was the party who suffered the loss and whose claim started the chain of liability, not the buyer.

The Court also rejected the defendant's argument that the claimant could not suffer damages in the form of loss of profits as this argument ran counter to art 15 of the CC RF that guarantees the compensation of all damage with a causal link to the incident. The Court also found that the claimant will bear liability through the chain of contractual liability, which is limited by the Hague-Visby Rules, as the liability of one party in the chain is limited. Moreover, the claimant is the carrier itself. Therefore, damage in the amount of EUR 174,954.21 is subject to compensation. The Court agreed with the conclusion of the Court of Appeal that the other damages caused by the loss of cargo in the amount of EUR 1,141,438.52 cannot be recovered from the claimant, and therefore, the claimant does not have the right to claim them from the defendant.

Based on the above, the Court dismissed the cassation appeal and upheld the judgment of the Court of Appeal.