Fujitsu Computers v. Bax Global
Note: this case has been listed for appeal on 26-27 April 2006
DMC Category Rating: Developed
This case note was prepared by Jim Leighton, BSc (Hons) (University of Plymouth), LLM (Maritime Law) (University of Southampton) and Claims Consultant
Bax was liable to Fujitsu pursuant to Article 18 of the Convention. Fujitsu however sought to deny Bax’s right to limit its liability under Article 22 of the Convention on two grounds. Firstly, Fujitsu claimed that the theft was either an "inside job" or that security was so lax that it amounted to wilful misconduct, pursuant to Article 25 of the Convention. Secondly, Fujitsu claimed that the HAWB failed to contain a notice in compliance with Article 8(c)1 of the Convention, whereby failure to comply disentitled Bax to limit its liability due to the effect of Article 92 of the Convention.
The trial dealt with the second preliminary issue. The question
before the Court was whether the HAWB:
If Bax could not limit its liability the claim was worth US$320,000, otherwise the limited liability claim was worth only US$20,000.
Fujitsu contended that the HAWB did not contain a notice to the
effect specified in Article 8(c).1 Fujitsu said that what was needed
was a self-contained and free standing section of the HAWB setting out the
information required. Bax contended that it was sufficient that the Article 8(c)1
information was contained somewhere within the HAWB. Bax further contended that
the information on the front and rear of the HAWB read together were sufficient
to give notice. The face of the HAWB stated:
Fujitsu further contended that, even if Bax were right about the sufficiency of the notice, the wording of the HAWB did not contain the requisite information.
Bax submitted that, taken as a whole, the face and reverse of the HAWB gave effective notice of the requirements laid down in Article 8(c).1 Bax indicated that Article 8(c)1 was not prescriptive in the form that the notice should take: it did not require a notice (i) to employ any form of words; (ii) to be headed "Notice"; (iii) to be in any particular format; (iv) to be separated from any other text; or (v) not to have any other material with it as well.
Although the judge noted that the issue was a technical one which lacked merit, if the requisite notice had not been given in the HAWB it was irrelevant that Fujitsu (as an experienced commercial party) would know what the notice should have said.
The judge stated that the issue to be decided had no reported authority and might have wider significance due to the near identical wording of Article 8(c),1 Article 3(1)(c) (prescribing the contents of a passenger ticket) and Article 4(1)(c) (prescribing the content of a baggage check).
(1) Whether the HAWB contained a notice
The judge held that the Convention required there to be a recognisable notice, that was to say a discrete form of words warning the reader of the potential applicability of the Convention and its effect (namely to govern and limit liability). The expression "a notice" was words of ordinary language, as distinct from "indication", "notification" or even "notice", and should be given the meaning that they would convey to the ordinary reader. On this basis the judge held that the ordinary reader of the HAWB would not regard it as containing on the reverse the notice promised on its face, or as containing on the face and reverse, something that he would describe as "a notice", and, when he had identified what it was, "the notice". The judge further did not accept that the HAWB was to be treated as containing a notice to the effect required because (if such be the case) it would be possible to spell out of the wording of some of the conditions of the contract notification of the relevant requirements.
The judge confirmed his view on the following grounds:
(2) If there is a notice, is it to the required effect?
The first matter requiring notification under Art.8(c) of the Convention was that, if the carriage involved an ultimate destination or stop in a country other than the country of departure, the Convention might be applicable. The face of the HAWB made it apparent that carriage was to be from one country (the Philippines) to another (the United Kingdom). The judge held that clause 2(a)4 on the reverse of the HAWB made it clear that the Convention might be applicable. The face and reverse of the HAWB also taken together indicated that, if the goods were being carried from Manila to Glasgow, then the Convention might apply.
The second matter requiring notification under Art.8(c) was that the Convention governed the liability of the carrier. As clause 2(a)4 of the HAWB Conditions stated that the carriage was subject to the rules relating to liability in the pre-Hague Protocol Warsaw Convention or Warsaw-Hague Convention, the judge held that this amounted to saying that those Conventions governed the liability of the carrier.
The third matter requiring notification under Art.8(c) was that the Convention "in most cases" (from the English text) limited the liability of the carrier. The judge decided that this required the notice to convey the way in which the Convention worked to establish a regime whereby limitation was the norm in the absence of exceptions. This construction sat easily with the phrase "en géneralité" from the French text of the Convention, which was to prevail in the case of inconsistency: Corocraft Ltd v Pan American Airways Inc  1 QB 616.
That left the question as to whether the words on the HAWB face, taken with the conditions on the reverse, stated that the Convention limited the liability of the carrier. The HAWB Conditions were consistent with that being the position, but they did not, in fact, state that to be the effect of the Convention. Nothing from the HAWB indicated that any limitation of liability was derived from the Convention rather than the HAWB Conditions imposed by the carrier – although the Conditions did make reference to the Convention rules relating to liability. Without further explanation, the effect of the reference on the face of the HAWB to limitation of liability meant the carrier imposed limitation under the contract of carriage. Nothing on the reverse said that the limits were imposed by the Convention.
The judge was aware that the analysis was itself technical and he did not feel disposed to apply interpretative generosity, considering that Bax could have used the recommended IATA form of air waybill notice3 and because the clear and directly informative notice required by the Convention was not difficult to achieve.
2. Article 9
If, with the consent of the carrier, cargo is loaded on board the aircraft without an air waybill having been made out, or if the air waybill does not include the notice required by Article 8, paragraph (c), the carrier shall not be entitled to avail himself of the provisions of Article 22, paragraph (2).
3. NOTICE CONCERNING CARRIER’S LIMITATION OF LIABILITY
IF THE CARRIAGE INVOLVES AN ULTIMATE DESTINATION OR STOP IN A COUNTRY OTHER THAN THE COUNTRY OF DEPARTURE, THE WARSAW CONVENTION MAY BE APPLICABLE AND THE CONVENTION GOVERNS AND IN MOST CASES LIMITS THE LIABILITY OF THE CARRIER IN RESPECT OF LOSS, DAMAGE OR DELAY TO CARGO TO 250 FRENCH GOLD FRANCS PER KILOGRAM, UNLESS A HIGHER VALUE IS DECLARED IN ADVANCE BY THE SHIPPER AND A SUPPLEMENTARY CHARGE PAID IF REQUIRED. THE LIABILITY LIMIT OF 250 FRENCH GOLD FRANCS PER KILOGRAM IS APPROXIMATELY USD 20.00 PER KILOGRAM ON THE BASIS OF USD 42.22 PER OUNCE OF GOLD.
1 As used in this contract "Convention" means the Convention for Unification of Certain Rules relating to International Carriage by Air, signed at Warsaw, 12th October 1929, or that Convention as amended by the Hague Protocol, 1955 whichever may be applicable to the carriage hereunder…
2a) Carriage hereunder is subject to the rules relating to liability established by the Convention, unless such carriage is not "international carriage" as defined by the Convention. (See Carrier’s tariffs and conditions of carriage for such definition).
b) To the extent not in conflict with the foregoing, carriage hereunder
and other services performed by each Carrier are subject to (i) applicable laws (including national laws implementing the Convention), government regulations, order and requirement. (ii) provisions herein set forth, and applicable tariffs, rules, conditions of carriage, regulations and timetables (but not the times of departure and arrival therein) of such carrier, which are made part hereof and which may be inspected at any of its offices and airports from which it operates regular services....
5. Article 11
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