A multimodal carrier, Geodis Denmark A/S (Geodis), managed the multimodal transport of goods for Lego System A/S (Lego) from Yanti in China to Kladno in the Czech Republic. The goods were transported under a framework agreement between the two parties, and transportation was performed by three different modes of transport: ship, rail, and truck. In the Czech Republic on 18 July 2018, it was discovered that some of the goods had been damaged by water while in Geodis's care and custody during the multimodal transport. Consequently, Tryg Forsikring A/S (Tryg) the cargo insurer for Lego, initiated proceedings against Geodis for DKK 469,351.90.

The parties agreed that Geodis was liable for the damaged goods under the framework agreement. However, the parties disagreed on the extent of Geodis’s liability, particularly the application of the 'network rule' in NSAB 2000, s 23, and whether Tryg could instead invoke the package limitation of liability in art 4.5.a of the Hague-Visby Rules.

Clause 12.1 of the framework agreement referred to NSAB 2000, s 15(1) of which states that the freight forwarder is liable as carrier according to ss 16-23 for damage to the goods, occurring from the moment when the goods have been taken over for transport until the moment the goods have been delivered. In cl 12.1 of the framework agreement, the parties had modified NSAB 2000, s 23, in such a manner that liability was generally limited to SDR 8.33 per kg of the gross weight of the damaged goods. However, this general limitation did not apply to transport by sea or air, entailing that if it was proven that the damage occurred while the goods were being carried by sea or air, the freight forwarder was liable in accordance 'with the law applicable to such mode of transport and the commonly used and generally accepted conditions of carriage to the extent that these deviate from what is laid down in section 5, part 2 of part 15-22 of the NSAB'.

Tryg argued that the Hague-Visby Rules must be considered 'commonly used and generally accepted conditions of carriage'. Tryg claimed that the damage had occurred during the transport by sea, which meant that the Hague-Visby Rules applied, in terms of which liability was limited to SDR 666.67 per package or unit or SDR 2 per kg of gross weight of the goods lost or damaged, whichever was the higher: see art 4.5.a. Consequently, Geodis's liability could not be limited. The damaged part of the consignment comprised 259 cartons, and the limitation amount calculated under the Hague-Visby Rules (SDR 666.67 x 259 cartons) thus exceeded Tryg's claim of DKK 469,351.90.

Geodis argued that Tryg had not proven that the damage had occurred during transport by sea. Consequently, pursuant to NSAB 2000, s 23, Tryg could not invoke the package limitation of liability in the Hague-Visby Rules. In support of the non-application of the Hague-Visby Rules, Geodis argued that:

• China had not ratified the Hague-Visby Rules, and thus the relevant sea waybill was not issued in a Contracting State within the meaning of art 10.a;
• the voyage did not begin in a port situated in a Contracting State within the meaning of art 10.b; and
• the application of the Hague-Visby rules had not been agreed between Geodis and Cosco Shipping Line, its maritime subcontractor: see art 10.c.

The Hague-Visby Rules only cover damage incurred after the consignment has been loaded on board the ship: see art 1.e of the Hague-Visby Rules. As it appears from Tryg's survey report that the damage was not due to seawater, there was no basis for assuming that the damage occurred during the sea voyage. If the Court concluded that the network provision in NSAB 2000, s 23, applied, and that Tryg could invoke the Hague-Visby Rules, it was disputed that Tryg had documented that the damage occurred within the carrier's custody period in accordance with art 1.e of the Rules, and Geodis was therefore not liable.

Held: Judgment for Geodis on the limitation issue. Geodis must pay compensation to Tryg of EUR 14,577.18, corresponding to compensation of SDR 8.33 x 1,433.62 kg (the weight of the damaged cargo) converted to EUR.

The application of the 'network rule' in the framework agreement and NSAB 2000, s 23, in this case required Tryg to prove that the cargo damage occurred during the transport by sea. The Court found that Tryg had not met this burden of proof. According to the nature of the damage and the information about the course of the transport, including the weather, etc, the Court did not find a reason to hold that the damage occurred during the transport by sea. In this regard, the Court took the view that the water damage was not caused by salt water. For that reason, Tryg could not invoke the limitation of liability in the Hague-Visby Rules over the clause in the framework agreement.