Case of dispute over contract of carriage of goods by sea filed by Zuoyou Furniture (Shenzhen) Co, Ltd against Schenker International (H.K.) Ltd and Schenker China Ltd etc.

Updated：2015-04-16 Views：2831 
Guangzhou Maritime Court of P. R. China

Civil Judgment      

 

(2008) Guang Hai Fa Chu Zi No.414



Plaintiff: Zuoyou Furniture (Shenzhen) Co., Ltd

Domicile: No.5 Luogang Road, Luogang Industrial District, Buji, Shenzhen 

Legal representative: Huang Jinlan, board director 

Agent ad litem: Liu Ning, lawyer of Guangdong Pin Ran Law Firm

Agent ad litem: Wu Ming, lawyer of Guangdong New Orient Law Firm



1st Defendant: Schenker International (H.K.) Ltd.

Domicile: 38/F, China Resources Building, No.26 Harbor Road, Wanchai, Hongkong

Legal representative: Andrew Blaise Jilling, board director



2nd Defendant: Schenker China Ltd.

Domicile: No.266, Yiwei Road, Pudong New Area, Shanghai City

Legal representative: Karl-Heinz Emberger, board director



3rd Defendant: Schenker (H.K.) Ltd.

Domicile: 35/F, Skyline Tower, 39 Wang Kwong Road, Kowloon Bay, Hongkong

Legal representative: Andrew Blaise Jiling, board director



4th Defendant: Schenkerocean Limited

Domicile: 35/F, Skyline Tower, 39 Wang Kwong Road, Kowloon Bay, Hongkong

Legal representative: Peter Rahan Sprogis, board director



Agents ad litem of the four defendants: Huang Hui, Zhang Jing, lawyers of Huang & Huang Co. Law Firm



With respect to the case arising from dispute over contract of carriage of goods by sea between the plaintiff Zuoyou Furniture (Shenzhen) Co, Ltd and the defendants Schenker International (H.K.) Ltd (hereinafter referred to as ?°Schenker International?±) and Schenker China Ltd (hereinafter referred to as ?°Schenker China?±), the plaintiff filed a litigation before this court on 19th August 2008. After accepting entertaining thereof, this court legitimately constituted the collegial panel to try this case. During the trial process, the plaintiff applied to add Schenker (H.K.) Ltd. (hereinafter referred to as ?°Schenker (H.K.)?±) and Schenkerocean Limited (hereinafter referred to as ?°Schenkerocean?±) as the co-defendants on 2nd April 2009 and 19th May 2009 respectively, and was hereby granted by this court. This court summoned the parties concerned for evidence exchange and open trial of this case on 19th May 2009 and 8th July 2009 respectively. The agent ad litem of the plaintiff, Liu Ning and the agents ad litem of the four defendants, Huang Hui and Zhang Jing participated in the court hearing. This case has now been concluded.

 

The plaintiff alleged that: Since April 2007, the plaintiff has concluded a serial of furniture purchase contract with Reid Furniture Ltd. from Britain by email (hereinafter referred to as ?°Reid Company?±), agreeing that the plaintiff would supply Reid Company with furniture such as sofas through different batches. After conclusion of the contract, Reid Company appointed Schenkerocean as the carrier for the goods under the foregoing contract. Ever since June 2007, Schenker China Ltd has advised the plaintiff to make booking with Schenker (H.K.) Ltd Dongguan Office who would make booking with the actual carrier Evergreen Line thereafter. After obtaining shipping space from Evergreen Line, Schenker (H.K.) Ltd Dongguan Office issued the plaintiff an S/O and notified him to arrange shipment. After the shipment is completed, the plaintiff paid Guangzhou Branch of Schenker China Ltd for relevant local operating fees and B/L fees. As the agent of Schenkerocean, Schenker International (H.K.) Ltd has issued the plaintiff three sets of original B/L No.CNCAN1050704825, No.CNCAN1050705063, and No.CNCAN1050705064. As the agent of Schenkerocean, Schenker (H.K.) Ltd. has issued the plaintiff three sets of original B/L No.CNCAN1050704473, No.CNCAN1050704475, and No.CNCAN10507044608. After the goods arrived at the port of destination, the buyer Reid Company did not effect payment against documents as agreed. On 11th March 2008, Schenker International (H.K.) Ltd advised the plaintiff by email that the goods had been delivered to the buyer Reid Company. Under the circumstance when the original Bs/L were not collected, Schenkerocean illegitimately released the goods to Reid Company, caused the plaintiff to loose the property in the goods therein the Bs/L while the Bs/L were still under his possession and resulted in a cargo value loss of USD243,522, an export tax refund loss of USD26,809.42, an interest loss of CNY115,961.8 and an exchange rate loss of CNY183,961.37. The plaintiff held that Schenkerocean, who released the goods at the port of destination without presentation of original B/L, caused failure of the plaintiff to obtain the cargo payment and suffering from loss of export tax refund, interest loss and exchange rate, shall bear the indemnity liabilities for the above losses; and the other three defendants are at fault and shall be severally and jointly liable. The plaintiff requested the court to adjudge the four defendants to indemnify the plaintiff for cargo value loss of USD243,522, an export tax refund loss of USD26,809.42, an interest loss of CNY115,961.8 and an exchange rate loss of CNY183,961.37 and bear the litigation fee of this case. 



The plaintiff submitted the following evidential materials within the time limit for burden of proof: 1. B/L; 2. Packing List; 3. Commercial Invoice; 4. Truck Operation Sheet; 5. Declaration Form; 6. Voucher for Inland Freight and Wharfage; 7. Transportation Invoice; 8. Bill for Local charges; 9. S/O and Evergreen Line??s Booking Notice; 10. Purchase Order of Reid Company; 11.On-line Cargo Inquiry and Tracking Record; 12. E-mail correspondences between the plaintiff and Schenker International (H.K.) Ltd.



The defendant Schenker International (H.K.) Ltd defended that: 1. Schenker International (H.K.) Ltd merely accepted the appointment of the carrier Schenkerocean and acted as the agent of Schenkerocean to sign and issue three sets of original B/L No. CNCAN1050704825, CNCAN1050705063 and CNCAN1050705064 for and on his behalf, is faultless in the carrier Schenkerocean??s release of goods without presentation of original B/L and shall not bear any indemnity liabilities for the disputes over release of goods without presentation of original B/L in the subject case in accordance with law. 2. The plaintiff has already received part of the payments from Reid Company, actually approved the carrier Schenkerocean delivering the subject goods to the consignee. The uncollected partial cargo payments were due to the quality defects of the goods, which has no direct cause and effect relation with the alleged release of goods without presentation of original B/L. 3. The claim amount alleged by the plaintiff is unreasonable. Firstly, the plaintiff has already received payment for cargo value in the amount of USD128,526.29 from Reid Company, which should be deducted from the cargo value loss claimed by the plaintiff. Secondly, the relevant evidence submitted by the plaintiff for proving the local freight as well as the operating and handling fee could not corroborate that such fees actually incurred from the subject goods, or that the plaintiff has actually paid for such fees. Even if it was so that such fees incurred from the subject goods and had been actually paid, such fees had been included in the actual value of the goods loaded on board, which would be a repeated claim with that of the cargo value claim. Thirdly, the law in our country stipulates that the amount of indemnity to be paid by the carrier to the holder of original B/L for release of goods without presentation of original B/L shall be calculated according to the value of goods loaded on board plus freight and insurance, and the loss for export tax refund and exchange rate claimed by the plaintiff goes beyond the statutory indemnity scope. As a result, the defendant required to reject the litigation requests filed by the plaintiff against Schenker International (H.K.) Ltd.



The defendant Schenker International (H.K.) Ltd. submitted the following evidential materials within the time limit for burden of proof: 1. Letter and the attachments thereof sent by Reid Company to Schenker International (H.K.) Ltd; 2. Registration Certificate for Private Limited Company of Reid Company; 3. Payment Voucher for the subject goods; 4. List of Quality Defects of the subject goods; 5. Claim Notice and photos of defected goods sent by Reid Company. All the above evidential materials are notarized and legalized. 



The defendant Schenker China Ltd defended that: 1.The plaintiff did not provide any evidence to prove that Schenker China Ltd. was the actual forwarder of Schenker International (H.K.) Ltd in Mainland China; 2. Schenker China Ltd did not have any transportation contractual relationship with the plaintiff, nor had ever participated in the carriage and delivery of the subject goods. Therefore, the plaintiff shall not be entitled the right to request Schenker China Ltd to bear any indemnity liabilities for the alleged release of goods without presentation of original B/L in the subject case. 



The defendant Schenker China Ltd did not submit any evidence within the time limit for burden of proof.



The defendant Schenker (H.K.) Ltd defended that: 1. Schenker (H.K.) Ltd only accepted the appointment of the carrier Schenkerocean and acted as the agent of Schenkerocean to sign and issue three sets of original B/L No. CNCAN1050704473, CNCAN1050704475 and CNCAN1050704608 for and on his behalf, is faultless in the carrier Schenkerocean??s release of goods without presentation of original B/L and shall not bear any indemnity liabilities for the disputes over release of goods without presentation of original B/L in the subject case in accordance with law. 2. The goods under the three sets of original B/L signed and issued by Schenker (H.K.) Ltd were delivered to the consignee Reid Company during July 2007 and December 2007 respectively, and the plaintiff confirmed that he was aware of the delivery of the goods on 11th March 2008. The plaintiff did not lodge litigation against Schenker (H.K.) Ltd until 30th March 2009, which exceeded the statutory time limit for lodging litigation. 



The defendant Schenker (H.K.) Ltd submitted the following evidential materials within the time limit for burden of proof: 1. Certificate of Incorporation, Certificate of Incorporation on Change of Name and Business Registration Certificate of Schenker (H.K.) Ltd.; 2. Certificate of Incorporation, Certificate of Incorporation on Change of Name and Business Registration Certificate of Schenker International (H.K.) Ltd.; 3. Certificate of Incorporation, Annual Return and Business Registration Certificate of Schenkerocean Limited; and 4. Letter of Confirmation. All the above evidential materials are notarized and legalized. 



The defendant Schenkerocean rebutted that: the goods under the six sets of B/L carried by Schenkerocean were delivered to the consignee Reid Company during the period from July 2007 to December 2007, and the plaintiff confirmed that he was aware of the delivery of the goods on 11th March 2008. The plaintiff did not lodge litigation against Schenker Ocean until 19th May 2009, which exceeded the statutory time limit for lodging litigation. The defendant required to reject the litigation requests filed by the plaintiff. 



The defendant Schenkerocean did not submit any evidence within the time limit for burden of proof.



After cross-examination at the court trial and taking the evidence and cross-examination opinion submitted by all the parties concerned into consideration, the collegial panel ascertained the following facts:



Since September 2006, the plaintiff has developed long-term furniture export trade cooperation with Reid Company. The subject goods are furniture under B/L No.CNCAN1050704473, CNCAN1050704475, CNCAN10507044608, CNCAN1050704825, CNCAN1050705063 and CNCAN1050705064, whose total value is USD243,522 as recorded in the B/L. For carriage of the above goods under the six Bs/L, the plaintiff made booking with Schenker (H.K.) Ltd Dongguan Office during the period from June 2007 to October 2007. After obtaining shipping space from Evergreen Line, Schenker (H.K.) Ltd Dongguan Office issued the plaintiff an S/O, notifying him to arrange shipment. After the shipment is completed by the plaintiff, the defendant immediately issued the plaintiff an expense list covering THC, document charges and commission charges, which totals CNY48,853, were paid by the plaintiff to Sinotrans Guangdong International Forwarding Co., Ltd, Guangzhou Branch (hereinafter referred to as ?°Sinotrans Guangzhou?±). Sinotrans Guangzhou issued the plaintiff special invoice of international freight forwarding agency for the expenses incurred under the 6 sets of Bs/L. During the trail, all the involved parties confirmed that cargoes under the 6 bills of lading have been shipped to the port of destination from July to December in 2007, and the carrier, Schenkerocean Ltd, actually released the cargo to the purchaser, Reid Company, without presentation of original B/L. The plaintiff received the email on March 11, 2008 from Schenker International (H.K.) Ltd and was informed that the cargo was delivered to Reid Company at the port of destination.



The three original bills of lading with B/L No. as CNCAN1050704825, CNCAN1050705063 and CNCAN1050705064 were stamped by the seal of Schenker International (H.K.) Ltd and the personal seal of Zhou Guoqiang. The other three original bills of lading with B/L No. as CNCAN1050704473, CNCAN1050704475 and CNCAN10507044608 were stamped by the seal of Schenker (H.K.) Ltd and the personal seal of Zhou Guoqiang. On the left top corner of the said six bills of lading, it was written in large printed letters that ?°SCHENKERocean?±, the shipper is the plaintiff, Reid Company as the consignee and the Notify Party, Shenzhen Yantian as the port of loading and Scotland GRANGEMOUTH as the port of destination. On the right bottom corner, it was written in red letters (other information was all written in black letters) that ?°Signed and issued as agents for Schenkerocean as Carrier by?±, and on the back side of the bills of lading, the ?°definition?± terms identify that the ?°carrier?± of the B/L refers to ?°the party under whose name the B/L is issued, which is Schenkerocean Ltd?±. On the left top corner of all the six Shipping Order of the involved cargoes, it was written that ?°Schenker (H.K.) Ltd -Dong Guan Office?±; on the right top corner ?°Acknowledgement of Booking only for Schenker (H.K.) Ltd?±??in the ?°document required?± column ?°Schenker Ocean B/L?±. The full name of Schenker Ltd -Dong Guan Office is Schenker (H.K.) Ltd -Dong Guan Representative Office??and with Zhou Guoqiang as its chief representative its registered No. is ?°No. Qi Wai Yue Wai Zhu Zi Di 000393?±. During the hearing, all the parties involved was unable to confirm the relationship between Zhou Guoqiang and the forth defendants. 



With respect to the loss claimed by the plaintiff, all the parties involved have no objection to the value of cargoes, worth USD 243.522, under the six bills of lading, which was also affirmed by the collegiate panel. The defendant, Schenker International (H.K.) Ltd, alleged that the purchaser, Reid Company, has paid USD128.526.29 as part of the payment for goods and submitted the payment vouchers for goods involved in the case. Despite that such payment vouchers as the Scottish Bank remittance slip submitted by the defendant, Schenker International (H.K.) Ltd, could prove that the purchaser, Reid Company, has indeed paid USD128,526,29 in different sums to the plaintiff as payment for goods, due to a long time of partnership and many times of sales and purchases of goods and incurrence of payment for goods between the plaintiff and Reid Company, such payment evidences rendered by Schenker International (H.K.) Ltd, can not be used to refer to cargoes under the six bills of lading, and therefore can not prove the amount of USD 128,526,29 was paid as payment for goods under the six bills of lading. Thus they were not affirmed by the collegiate panel. The RMB48, 853 loss of local freight and relevant handling charges claimed by the plaintiff is charges happened before loading. It was the necessary cost for the plaintiff to export goods. The cost should have been included in the actual value at the time of loading. The plaintiff has no right to double claim the charges. The plaintiff rendered no evidence to prove the USD26.809.42 loss of export rebate it claimed, and therefore was not affirmed by the collegiate panel. The plaintiff claimed a RMB183. 961. 37 loss of foreign exchange rate. Owing to the contract breach of the defendant, the plaintiff didn??t receive the payment on time, causing the plaintiff unable to exchange the payment in time and to avoid the risk of depreciated US Dollars against RMB. Therefore, the foreign exchange rate loss of the plaintiff should be indemnified by the defendant, and the plaintiff should pay the cargo value in RMB as per the exchange rate on the agreed day of payment.



Members of the collegiate panel have agreed that this case is resulted from dispute over the contract of carriage of goods by sea. During the trial, all the parties involved agreed that laws of the P. R. China are applicable. According to Article 269 of Maritime Code of the People??s Republic of China, laws of the P. R. China are applicable to settle substantive disputes in this case.



After the plaintiff concluding the export trade contract with the purchaser, Reid Company??the plaintiff contacted Schenker (H.K.) Ltd -Dong Guan Representative Office and conducted services like booking, shipment, payment, etc as required by the office. Schenker (H.K.) Ltd -Dong Guan Representative Office stated clearly on the six shipping orders given to the plaintiff that it accepted the booking on behalf of Schenker (H.K.) Ltd. Among the six bills of lading possessed by the plaintiff, the three original bills of lading with B/L No. as CNCAN1050704825, CNCAN1050705063 and CNCAN1050705064 were stamped by the seal of Schenker International (H.K.) Ltd and the personal seal of Zhou Guoqiang. The other three original bills of lading with B/L No. as CNCAN1050704473, CNCAN1050704475 and CNCAN10507044608 were stamped by the seal of Schenker (H.K.) Ltd and the personal seal of Zhou Guoqiang. However, from the contents of the Bs/L, on the right bottom corner of the bills, it was written in red letters (other information was all written in black letter) that ?°Signed and issued as agents of Schenkerocean as Carrier by?±, and on the left top corner ?°Schenkerocean?± in big printed letters. it could be considered that through what was recorded on the bills of lading Schenkerocean Ltd is shown as the carrier, authorizing Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd to issue the bills of lading, and Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd are the agents of Schenkerocean Ltd. The plaintiff had no objection while accepting the bills of lading, thus it could be regarded that the plaintiff recognized the proxy relation between Schenkerocean Ltd and Schenker (H.K.) Ltd and Schenker International (H.K.) Ltd, and was aware that Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd undertook civil legal acts under the name of Schenkerocean Ltd. It also confirmed the establishment of contract of carriage of goods relation with Schenkerocean Ltd. And Even though the plaintiff viewed Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd established the contract relation under their own names, according to Article 402 of Contract Law of the People's Republic of China, ?°Where the agent enters into a contract with a third party under the agent??s name within the scope of authorization by the principal, and if the third party is aware of the proxy relationship between the agent and the principal, the said contract shall directly bind the principal and the third party, unless truthful evidence proves that the said contract binds only the agent and the third party.?± Under the circumstances where the plaintiff hasn??t rendered any evidence to prove the involved contract of carriage of goods binds only the plaintiff, Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd, it shall be considered that parties concerned stated on the six bills of lading are the plaintiff and Schenkerocean Ltd.



The plaintiff believed that Schenker International (H.K.) Ltd didn??t register with the Administration for Industry and Commerce in China, and didn??t pay taxes in accordance with laws; Schenker (H.K.) Ltd didn??t register with the Administration for Industry and Commerce in China, didn??t pay taxes in accordance with law and didn??t acquire the NVOCC qualification from the Ministry of Communications; Schenkerocean Ltd obtained the NVOCCC qualification, yet it didn??t establish the corporate legal person in China according to law. The three defendants violated relevant regulations in the Regulations of the PRC on International Maritime Transportation put forward by the State Council and the promulgation on the implementation of the Regulations of the PRC on International Maritime Transportation put forward by the Ministry of Communications. The acts represent illegal proxy, and the three defendants should take several and joint liabilities. Nevertheless, the plaintiff has not rendered any valid evidence to prove the above facts. According to Article 14 of Supreme Peoples Court, Several Issues Concerning Application of the ??PRC, Contract Law??Interpretation (1), ?°??mandatory provisions??in paragraph 5 of Article 52 of Contract Law means mandatory provision of competence.?± Even though the three defendants didn??t establish corporate legal person in China or obtain NVOCC qualification, they violated just mandatory provision of management. It won??t necessarily cause the proxy act or the contract of carriage of goods invalid.

 

The plaintiff filed the lawsuit over the loss caused by the carrier of cargo involved releasing the cargo to the consignee without presentation of original B/L. According to Article 71 of the Maritime Code of the People??s Republic of China, a bill of lading is document based on which the carrier undertakes to deliver the goods against surrendering the same, and the carrier has the obligation to release goods based on the original B/L. In this case, Schenkerocean Ltd is the party liable for the act of releasing goods based on no original B/L. In according with paragraph 2 of Article 63 of General Principles of the Civil Law of the People's Republic of China, ?°An agent shall perform civil juristic acts in the principal??s name within the scope of the power of agency. The principal shall bear civil liability for the agent??s acts of agency.?± The liability for releasing goods based on no original B/L shall be born by the carrier itself rather than its agent. Since Schenker International (H.K.) Ltd and Schenker (H.K.) Ltd are only agents of the carrier, Schenkerocean Ltd, and not concerned parties in the contract of carriage relation, they shall not be liable for Schenkerocean Ltd??s act of releasing goods based on no original B/L. Given the current evidences, Schenker China Ltd has no connection with the carriage of the goods involved and didn??t participate in any part of the carriage of the goods. Thus it also shall not be liable for Schenkerocean Ltd??s act of releasing goods without the original B/L.



Cargoes under the six bills of lading involved in the case arrived at the port of destination during July to December in 2007, and were actually delivered to Reid Company by the carrier, Schenkerocean Ltd. On March 11, 2008 the plaintiff acknowledged that the carrier had already released the goods without obtaining the original B/L before, and on May 19, 2009 applied to add Schenkerocean Ltd as co-defendant of this case. According to Article 14 of Supreme Court, Regulation on Several Issues about Applicable Law for Trailing Cases of Delivery of Goods Based On No Original B/L, ?°holder of the original B/L filing lawsuit against the carrier for delivery of goods based on no original B/L could be judged by Article 257 of Maritime Code of the P. R. China. The limitation of action is one year, calculated from the supposed day of delivery of goods by the carrier.?± The plaintiff was unable to render any valid evidence to prove that the limitation period shall be suspended or discontinued, and its lawsuit against Schenkerocean Ltd has surpassed one year of limitation of action. Therefore, it shall lose the right to win the lawsuit.



In conclusion, According to the provisions of paragraph 2 of Article 63 of the General Principles of the Civil Law of P. R. China and the provisions of Article 257 of the Maritime Code of the P. R. China, the judgment is hereby rendered as follows: 



To reject the litigation requests filed by the plaintiff Zuoyou Furniture (Shenzhen) Co, Ltd.



The court fee of this case is RMB 24,456, all of which shall be borne by the plaintiff. 



In case of any dissatisfaction, the plaintiff, Zuoyou Furniture (Shenzhen) Co, Ltd, and the defendant, Schenker China Ltd may, within 15 days after the written judgment is served, and the defendants, Schenker International (H.K.) Ltd, Schenker (H.K.) Ltd and Schenkerocean Ltd may, within 30 days after the written judgment is served, submit respectively the appeal petition with the copies of it according to the number of persons in the other party to this court and file an appeal with Guangdong Provincial High Court of People??s Republic of China.



Presiding judge: Cheng Sheng Xiang

Judge: Zhang Ke Xiong

Assistant Judge: Gu En Zhen



(Official Chop of Guangzhou Maritime Court affixed)

10th August 2009

Certified as true to the original 



                   Clerk: Yang Qian





The translation is provided by Huang & Huang CO.