The appellant, a freight forwarding company, brought an action against the respondent for the amount that the appellant would have to reimburse its client as a result of an action its client intended to bring against the appellant concerning the loss of certain goods carried between Leixões and Sydney. In addition, the appellant argued that its commercial reputation with the Portuguese emigrant community resident in Australia had been, and continued to be, seriously undermined by this incident, and for this reason the appellant had since lost significant business with Portuguese emigrants resident in that country.

In reply, the respondent denied that it had been obligated to the appellant to transport or had even transported the allegedly missing goods by sea, stating that it had merely acted at the request of the appellant, having contracted the carriage of the goods by sea with a third party carrier, acting as the appellant's agent. In the alternative, it claimed that its liability could never exceed that of the sea carrier.

The third party carrier intervened and objected that the appellant's right of action had expired pursuant to art 3.6 of the Hague Rules, arguing that delivery of the container and goods at the port of Sydney should have taken place by 7 July 1996, and that its principal intervention in the present action was requested only on 3 November 1997. The appellant's claims against the third party carrier and the respondent were dismissed. Not satisfied, the appellant appealed again. The appellate court, however, dismissed both appeals, confirming the dismissal in the lower court regarding both the carrier and the defendant (see CMI637). The appellant appealed to the Supreme Court.

Held: Appeal dismissed.

The appellant argued that the provisions of art 3.6 of the Hague Rules, which became Portuguese domestic law through DL 37748 of 1.2.50, did not apply to the third party carrier as it was only acting as a freight forwarder, not owning or chartering the ship carrying out the transport; and since, moreover, the appellant did not directly contract for such transport with the third party carrier. That is incorrect. That provision of the Hague Rules is fully applicable to the present case because the bill of lading was issued in Portugal. And it also follows, without a doubt, that the carrier was a party to the contract of carriage. However, the term 'shipowner' (armador) used in art 3.6 of the Hague Rules, and also in art 1.a thereof, is the result of a manifest lapse in the official Portuguese translation. It should read 'carrier' (transportador), which is contained in the French text, the only official text of the Convention (in this regard, see Mario Raposo, Maritime Law - A Perspective, in the ROA, 43rd, p 354 fn 15). As the aforementioned author points out, the charterer is not the shipowner, but rather the party that enters into a charterparty which then allows it to conclude the transport contract. Accordingly, liability for loss and damage which, according to the Hague Rules, shall cease 'in all cases' if action is not taken 'within one year of the delivery of the goods or the date on which they should be delivered' refers to the carrier's responsibility. There is also no doubt that the time limit in question results in forfeiture of the action, as has been uniformly emphasised by doctrine and case law, taking into account the criterion laid down in art 298(2) of the CC (cf Limiting Carrier Liability under the 1924 Brussels Convention, p 139, by Hugo Ramos Alves). In fact, the appellant has not questioned this in the proceedings, and only now, with dubious good faith, has come to do so. It was established that the goods should have been delivered to the port of Sydney on 7 July 1996 and that the intervention by the third party carrier was triggered on 3 November 1997. It is therefore correct that the right to pursue the carrier for loss and damage caused by carriage has expired, as the courts have held.