Plus Ultra Compañía Anónima de Seguros (the plaintiff), an insurance company acting under an assignment of rights, claimed for damage to a cargo carried from China to Bilbao, Spain. The lawsuit was filed against Schenker SA (the defendant), a freight forwarder that undertook the carriage.

The defendant appeared in the process and alleged the claim was elapsed (caducada). The first instance Court admitted the claim and ordered the defendant to pay compensation in full. This Court stated that claim was not elapsed (caducada) because the Law on Carriage of Goods by Sea of 22 December 1949 (LCGS 1949), that introduced the Hague Rules into the Spanish legal system with some modifications, did not apply to this claim. This was because art 24 of the LCGS 1949 provides that this law only applies to carriage between States that have ratified the Hague Rules, and China had not ratified the Hague Rules. Hence, the Code of Commerce (CCom) was applicable and, according to its provisions, the time limitation (precripción) was timely interrupted through a request for conciliation filed by the plaintiff. On appeal, the decision was reversed. The Court of Appeal held that the Hague Rules applied to this claim because the cargo was carried from Bilbao to a port in China for a temporary exhibition in Beijing, and then from China back to Bilbao. As the defendant undertook to perform both carriage segments under the same contract, Bilbao was the point of origin and destination, making the Hague Rules applicable according to art 24 of the LCGS 1949. Therefore, the claim was elapsed (caducada) as the lawsuit was not filed within the one-year period established in art 3.6 of the Hague Rules. The plaintiff recurred this decision in cassation before the Tribunal Supremo/Supreme Court (SC), alleging an infraction of arts 22 and 24 LCGS 1949 and art 3.6 of the Hague Rules.

Held: The SC reversed the decision. The SC stated that to determine the scope of application of the Hague Rules, which in art 3.6 contains the same provision of art 22 of the LCGS 1949, the Court must observe art 10 of the Hague Rules, as amended by the Protocol of 1968, introduced into the national legal system when Spain ratified the Protocol of 21 December 1979 (the Hague-Visby Rules and SDR Protocol). The Court of Appeal overlooked the first prerequisite stated in the first para of art 10 of the Hague-Visby Rules, which indicates that these Rules ‘shall apply to every bill of lading relating to the carriage of goods between ports in two different States’. The port of origin must be determined, not by the content of the first contract signed by the defendant in its capacity of freight forwarder, and by which it undertook the carriage by different means of transport, but by the contract of carriage of goods by sea that started at the Chinese port and ended in Bilbao. The latter is the contract evidenced in the bill of lading. According to art 1.b of the Rules, ‘contract of carriage’ refers only to contracts covered by a bill of lading or any similar document. As China is not a State party to the Rules and no choice of law clause providing the application of the Rules had been alleged, none of the conditions of art 10 are met, making the Hague-Visby Rules inapplicable. Therefore, the CCom governed the claim. The freight forwarder is liable as a carrier because it assumed and performed such obligations, either by a third party, or personally in one segment. Regarding the time limitation, the CCom establishes a time-bar period (prescripción) that can be interrupted by a request for conciliation. As it was timely interrupted, the defendant was ordered to pay compensation in full.