Accuser: A, an Insurance Company, Changzhou Branch
Defendant: B, an International Freight Company
The Parties’ Allegation in First Instance
The accuser alleged: in July, 1999, B accepted C company’s commission to deliver a batch of cargo to foreign countries and issued Clean B/L, which was insured against all marine risks by A , but after arriving at the destination, the cargo was found to be polluted. In accordance with insurance policy, A compensated the consignee for the cargo loss & inspection expenditure, got the letter of subrogation and requested B to compensate, but was refused. Under this circumstances, A demanded the court to decree B to pay $ 29,453.68 for the damage &interest as well as to undertake the legal fare.
The defendant pleaded: in the case, the carrier was W company, while B was just a B/L issuing agent, so A had no authority to claim rights upon B. On September 1oth, 1999, the cargo involved had been delivered to the consignee, but it was not inspected until November 15th, which spreaded for more than two moths and B disavowed the inspection report. So B appealed the court to overrule A’s request.
The parties submitted B/L, insurance policy, invoice, packing list, inspection report and other evidences.
The Court of First Instance Ascertaining the Facts
In July 9th, 1999, C covered the insurance for a batch of export cargo against all marine risks with A, who accepted the insurance and issued an insurance policy of $77, 770. On July 13th, 1999, B issured a B/L for the cargo with the title of W company, in which it noted that AS AGENT FOR THE “W (Company)” CONSOLIDATORS INC. The cargo arrived at the overseas destination on Augest, 8th, 1999, and was delievered to the consignee on September 10th, when he found the cargo to be polluted, the consignee immediately contacted W company and appealed an inspection on November 10th. The inspection company issured an inspection report on March 8th, 2000 and concluded that the total loss amount was $ 25,373.30, which was based on the invoice value. A asked B to pay 110% of the above sum and relevant accident investigation fees, coming to $ 29, 453.68.
First Instance Court Judicial Form
Dismissed the accuser’s claim upon the defendant.
The Parties’ Allegation in Second Instance
A appealed: only having office inside China, B had no management right according to law. Therefore, B had no right to sign O. B/L of international containers, which was not registered in the administrative department for transportation of State Council and couldn’t be used to engage in O.B/L operation of international containers. During the first instance, the court couldn’t find out the carrier in the case and B should be reponsible for the cargo damage. The appellant hoped that the second instance court could rescind the original judgement and approved the appeal.
The appellee B alleged, because the cargo had actually delievered to the carrier involved, its damage had nothing to do with the appellee’s signing right and regisration of B/L. The appellee had clearly expressed that it was just a B/L issuing agent and the appellant had received the B/L without any protest.So the appellee hoped that the court could dismiss this appeal and affirmed the original judgement.
Second Instance Court Judicial Form
Dismissed the appeal and affirmed the original judgement.
Judge Comment
This case is a dissension upon subrogation of cargo transportation contracts in Shanghai.
Cargos insurance accident happened, after compensating in accordance with insurance contract and obtaining a letter of subrogation, the assurer could applies a subrogation against the party responsible. In this case, the accuser acquested the right of subrogation from the carrier according to the contract of maritime cargos transportation. However, in the B/L to sue, it had clearly written that the carrier was W company, while B was only its B/L issuing agent. So B shouldn’t undertake the carrier’s obligations. The transport contract had actually been implemented, for the consignee had received the cargo in the destination. Therefore should claim the compensation of cargo damage against the carrier, i.e. W company. Because A had no evidence to prove that B was the carrier, it was groundless in law to ask B to compensate as well as to undertake the carrier’s obligations. Besides, A said that B had no right to sign O. B/L ,for just only having an office inside China, the B/L involved did not registered in the relevant administrative department and other excuses, all of which have no necessary causal connection with the cargo damage, so the basis of requesting B to undertake the obligation is insufficient.