This was a claim brought by LLC Trest RosSEM (the claimant) against LLC Bedford Group SPb (the defendant) for loss of cargo during its transportation from Novorossiysk, Russia, to Alexandria, Egypt, and delay in delivery.

The claimant and the defendant entered into a freight forwarding agreement to organise the transportation of metal building materials from Novorossiysk, Russia, to the construction site of a nuclear power plant in El Dabaa, Egypt. The shipper was the claimant and its associated company, JSC NIKIMT-ATOMSTROY. The consignee was the offices of the claimant and its associated company in Egypt. The transportation was multimodal, road-sea-road. The freight forwarder was obligated to deliver the cargo within 10 days after loading it on the ship. The claimant was required to pay 50 per cent of the freight within 7 days after loading the cargo onto the ship. The other 50 per cent was to be paid after the delivery of the cargo to the construction site. The defendant insured the cargo, indicating the claimant and its associated company as beneficiaries. Under the booking note, 1,859.4 mt of cargo was loaded onto the Pizhma on 28 April 2022. The cargo was only delivered to the construction site only on 27 June 2022. Furthermore, the claimant found that only part of the cargo was delivered. Therefore, it brought claims for cargo loss and delay in delivery.

In turn, the defendant submitted a counterclaim for demurrage caused by the claimant's failure to issue customs documents needed for the cargo's processing upon its discharge from the ship, as well as payment of the remaining 50 per cent of the freight.

The Court of first instance dismissed the claim for compensation for loss of cargo and partially satisfied the claim for damages caused by delay. The counterclaim was satisfied in full, except for the interest upon the due sum.

The Court found that the claimant failed to prove that the cargo was lost during transportation. The cargo loss was only discovered on the construction site after some time had passed after the carriage was completed. The report on the lost cargo was drafted by the claimant's employee on site without the involvement of the defendant's representatives. The bill of lading could not serve as proper proof of the amount of cargo loaded onboard the ship since it indicated that 'the quality, quantity and weight of the cargo are unknown to the carrier'. Moreover, it was mentioned in the bill of lading that part of the metal materials had traces of rust, damaged fastenings, and other damaged elements.

The claimant submitted an appeal.

Held: The appeal is dismissed. The judgment of the Court of first instance is upheld.

Both arts 6(3) and 6(4) of the Federal Law on Freight Forwarding Activity and art 170(1) of the Merchant Shipping Code of Russia (the MSC RF) stipulate that the liability of the carrier or freight forwarder for damage to or loss of cargo is limited to 666.67 SDRs per item, or 2 SDRs per kg, whichever is the higher amount. These provisions are based on the Hague-Visby Rules. The defendant's liability is limited accordingly.

According to arts 117 and 142 of the MSC RF, the existence and the content of a contract of carriage are proved by a bill of lading issued by the carrier. The same is stipulated in art 3.4 of the Hague Rules, according to which a bill of lading is prima facie evidence that the carrier received the cargo.

A bill of lading has three main functions. It proves the conclusion of a contract of carriage of goods by sea, proves the receipt of the goods by the carrier, and gives its holder the right to dispose of the goods after they are loaded onto the ship.

In this case, the bill of lading contained a clause stating that the quality, quantity, and weight of the cargo are unknown to the carrier. It follows that the defendant did not check the weight of the cargo before its loading. Further, the contract between the claimant and the defendant did not contain any obligation on the part of the defendant to weigh the cargo. The claimant’s argument that the bill of lading was nevertheless sufficient proof that the cargo was accepted by the carrier as described therein was rejected by the Court.

The Court found that the claim for damages caused by the delay in delivery in the form of the penalty stipulated in the contract was justified. At the same time, it held that the delay was partially caused by the claimant's fault in failing to provide the necessary documents to proceed with the road part of the carriage in Egypt. Given that the delay was caused by the fault of both the claimant and the defendant, the Court of first instance had found it appropriate to decrease the amount of penalty by 50 per cent. The Court of Appeal agreed.

Furthermore, the claimant's failure to issue the necessary documents caused the defendant losses in the form of payment for storing the cargo in a warehouse and demurrage fees. The claimant was found liable for these losses. Finally, as the cargo was delivered to the claimant, the claimant was found liable for the remaining 50 per cent of payment under the freight forwarding contract.

[Judgment confirmed on cassation appeal: see the Judgment of the Commercial Court of the Volga-Vyatka District in Case No A43-3510/2023 dated 15/10/2024.]