TNT Global v. Denfleet Int.'l (CofA)

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TNT Global SpA v Denfleet International Ltd
English Court of Appeal: Waller, Tuckey and Toulson LJJ: [2007] EWCA Civ 405: 2 May 2007
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Michael Nolan (instructed by Halliwells LLP) for the Appellant, TNT
Jo Cunningham (instructed by Hill Dickinson LLP) for the Respondent, Denfleet

In reversing the decision of HHJ Kershaw QC (Queen’s Bench Division, Manchester Mercantile Court), the Court of Appeal unanimously held that the bare fact of the lorry driver admitting he fell asleep at the wheel (and, by reasonable inference, was aware that he had begun to feel sleepy) was insufficient to justify a finding of ‘wilful misconduct’. What was required to prove ‘wilful misconduct’ was proof that the driver had deliberately driven beyond the permitted time limits at law (Jones v Martin Bencher [1986] 1 Lloyd’s Rep 54) or something that had demonstrated to the driver that he could not beat his sleepiness, such as hitting the side of the road or realising that he had previously nodded off during the journey.

DMC Category Rating: Confirmed

By Jim Leighton, BSc (Hons), LLB, LLM (Maritime Law), Claims Consultant and International Contributor to DMC’s CaseNotes

TNT agreed to carry the goods of Denfleet from Naples to Elstree in the UK. TNT subcontracted the Rome-Milan leg of the journey to a third party. The driver of the third party subcontractor’s lorry, Mr Caselli, was a professional driver. At about 8.50am on 1 August 2002 the lorry driven by Mr Caselli was involved in an accident near Milan. According to the police report, the carriageway at the point of the accident had three lanes and a hard shoulder; the weather was calm, visibility was good and the traffic was heavy. The lorry hit the rear of a semi-trailer, which was being driven at 85 km/hr in the slow lane of the motorway, and then veered off the carriageway, knocked down a barrier and burst into flames. Denfleet’s goods, a cargo of pharmaceuticals, were destroyed in the fire. According to a police report, Mr Caselli said he was driving along the motorway in the direction of Milan, using the slow lane, when: "As a result of falling asleep at the wheel, I hit a heavy vehicle that was in front of me, despite an attempt in extremis to veer to the right, shortly after I ended up on the slope, where my heavy vehicle caught fire."

The case revolved around the application of the Convention on the Contract for the International Carriage of Goods by Road ("the CMR"). Following the accident, Denfleet failed to issue a claim form within the 1-year time limitation period of the CMR, Article 32. However, the 1-year time limitation period of Article 32 is extended to three years "in a case of wilful misconduct". As a result, if Denfleet were to recover any damages, it had to prove ‘wilful misconduct’ by TNT, its servants, agents or subcontractors. The agreed value of the cargo was £300,000 and this sum would be fully recoverable (in accordance with the CMR, Article 29) if ‘wilful misconduct’ were proven by Denfleet.

There was no evidence that the lorry driver had driven erratically or beyond the permitted time limits laid down by drivers’ hours regulations. It was the lack of evidence in this case that brought about the difficulties that arose for decision. The judge at first instance held that the driver’s (inferred) knowledge that he was sleepy and his deliberate decision to continue to drive when he knew he was sleepy constituted ‘wilful misconduct’. TNT appealed, arguing that the judge at first instance had failed to make a distinction between negligence misjudgement, which was justified by the facts, and wilful misconduct, which was not.

Opinions were given by Waller and Toulson LJJ with whom Tuckey LJ agreed.

Waller LJ first reviewed the many authorities that sought to define wilful misconduct: National Semiconductors (UK) Ltd v UPS Ltd [1996] 2 Lloyd’s Rep 212, 214, per Longmore J (as he then was),1 Forder v Great Western Railway Co [1905] 2 KB 532, 535-6, per Lord Alverstone CJ (adopting and adding to the definition by Johnson J in Graham v Belfast and Northern Counties Railway Co [1901] 2 IE 13),2 and Lacey’s Footwear v Bowler International [1997] 2 Lloyd’s Rep 369, 374, per Beldam LJ.3

Waller LJ noted that the parties and judge at first instance had properly identified the burden and standard of proof – the burden being on the claimant, Denfleet, and the standard being that of the balance of probabilities (with good evidence being required to take account of the seriousness of an allegation of wilful misconduct).

However, given the first instance judge’s finding, Waller LJ was unable to accept that "mere knowledge on the part of a driver that he was sleepy and a decision to continue to drive would constitute wilful misconduct." He continued: "As regards misconduct per se, I find it difficult to think that if all that had happened was that a driver had felt sleepy and admitted such when he walked into his depot, that his employer would have been entitled to dismiss him for misconduct, let alone wilful misconduct." This would have been different "if, of course, [the driver] confessed to driving contrary to the regulations as to time and rest periods, and admitted that he appreciated that fact, the situation would be entirely different." Also "if a driver crashed his lorry after falling asleep, and it could be shown that he had been made aware that he could not defeat his feeling of sleepiness because he had already hit the side of the road or driven in a way that indicated that he had nodded off, that would be different again." However, this was not established on the facts in the present case.

Waller LJ indicated that "if there had been some evidence to support the view that the driver might have been driving beyond the permitted time limits, or some evidence of erratic driving, then if the carriers chose not to call the driver who is alive and well or even put a statement in from him, it would have been open to the court to draw adverse inferences. But in this case [Denfleet does] not assert any such factors. Furthermore the driver was not, it seems, even prosecuted by the Italian authorities."

Toulson LJ noted that driver fault or misconduct may or may not involve matters of degree. In the case of driver tiredness, at one end the driver may feel some transient (minor) degree of tiredness, believing it not to be sufficient to affect his ability to drive properly, and at the other, the driver may be fully aware that his ability to drive is significantly impaired. The former may involve negligent misjudgement, but not wilful misconduct.

According to Toulson LJ "the key question to my mind is whether the lorry driver must have known that his ability to drive was significantly impaired, or, to put it more fully, whether he knew that he ought to stop because there was a risk of his failing to drive with proper care on account of tiredness." As a result, Toulson LJ concluded "that the bare fact of the driver’s admission that he fell asleep is insufficient to justify that conclusion."

The decision in the present case very much represents the difficulties that arose due to the lack of evidence regarding the amount of time the driver had been at the wheel and the limited amount of information available in the police report. Ordinarily such difficulties are less likely to arise for a diligently pursued claim, as business records and contemporary witness statements are easier to obtain at an earlier stage. It also highlights that a negligence misjudgement alone will be insufficient to meet the stringency of the ‘wilful misconduct’ test. Note that a failure to provide evidence from a driver who is fit to testify following an accident may entitle the court to make ‘adverse inferences’ if this is justified by the surrounding circumstances.

1. "for wilful misconduct to be proved there must be either (1) an intention to do something which the actor knows to be wrong or (2) a reckless act in the sense that the actor is aware that loss may result from his act and yet does not care whether loss will result or not or, to use Mr Justice Barry’s words in Horobin’s case, "he took a risk which he knew he ought not to take" [1952] 2 Lloyd’s Rep. at p.460".
2. "Wilful misconduct . . . means misconduct to which the will is party as contradistinguished from accident, and is far beyond any negligence, even gross or culpable negligence, and involves that a person wilfully misconducts himself, who knows and appreciates that it is wrong conduct in his part in the existing circumstances to do, or to fail or to omit to do (as the case may be), a particular thing, and yet intentionally does or fails or omits to do it, or persists in the act, failure or omission, regardless of the consequences." Lord Alverstone suggested the addition of "or acts with reckless carelessness, not caring what the results of his carelessness may be."
3. "Further a person could be said to act with reckless carelessness towards goods in his care if, aware of the risk that they may be lost or damaged, he nevertheless deliberately goes ahead and takes the risk, when it is unreasonable in all the circumstances for him to do so."

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