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Transport

Gross negligence and limitation of liability regarding transportation of medicine

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Legal news
calendar 11 December 2019
globus Denmark

In a case before the Maritime and Commercial High Court two on different carriages of medicine, the medicine was exposed to rising temperatures which made it unfit for sale. Both claims were caused by errors in the cooling systems, but since the circumstances were different, the court found that the loss was caused with gross negligence in only one of the events. In the other case, the carrier was able to rely on CMR limits.

A supplier of medicine had instructed a road hauler to carry out two refrigerated carriages of medicine. The cooling compartments in the carrying trucks had alarm systems installed which were to notify the carrier’s office if the temperature changed.

During the first carriage, an IT-error occurred causing the cooling and alarm systems to stop so that they did not react to the rising temperature. The second consignment was damaged because of an error in the cooler which made it blow hot air into the cargo hold. In both events, the medicine was exposed to higher temperature than allowed for a prolonged period which made them unfit for sale.

In both events, the supplier claimed that the carrier had acted with gross negligence. In the event concerning the IT-error, this was because the driver had not checked the cargo temperature during his daily rest period when the temperature rose. Furthermore, the supplier considered it an act of gross negligence that they had not been contacted immediately when the error was identified. In the other event, the responsible manager ignored several alarms because he knew the truck was parked by a ramp and, therefore, assumed the truck was being unloaded.

The carrier denied liability for the loss and contested that it was proven that the medicine was fit for sale before it was delivered to the drivers. Furthermore, it denied gross negligence in both events.

The Maritime and Commercial High Court: Liability for the loss, but only gross negligence in one of the events

The court found that the damage on the medicine happened while this was in the carrier’s custody and accordingly the carrier was liable for the damage.

In the first event, the court found that the damage was caused by an IT-error and not by the driver’s lack of supervision with the temperature. According to the contract, the driver was not obliged to supervise the temperature since the carrier did this through the alarm system. Furthermore, the court found that the cargo was already damaged when the error was eventually identified, and so it did not make any difference that the supplier was not contacted immediately. Therefore, the carrier was able to limit their liability pursuant to the CMR act, s. 31, subs. 2, cf. s. 29, subs. 2.

In the other event, the court ruled that the responsible manager had set aside fundamental responsibilities by ignoring the alarms and, thereby, acted with gross negligence. Therefore, the carrier could not rely on limitation of liability, cf. the CMR act, s. 37.

IUNO’s opinion

This decision shows how the CMR act, s. 37 is applied. The court assess each case separately and weighs up the actions and omissions on a case by case basis. Breach of contract or instructions can mean that a damage is considered caused with gross negligence, but it is also decisive that this breach has caused or contributed to the loss. In other words, a causal connection between the breach of contract and the caused damage is needed. Furthermore, it cannot be agreed by contract what is to be considered gross negligence.

A supplier of medicine had instructed a road hauler to carry out two refrigerated carriages of medicine. The cooling compartments in the carrying trucks had alarm systems installed which were to notify the carrier’s office if the temperature changed.

During the first carriage, an IT-error occurred causing the cooling and alarm systems to stop so that they did not react to the rising temperature. The second consignment was damaged because of an error in the cooler which made it blow hot air into the cargo hold. In both events, the medicine was exposed to higher temperature than allowed for a prolonged period which made them unfit for sale.

In both events, the supplier claimed that the carrier had acted with gross negligence. In the event concerning the IT-error, this was because the driver had not checked the cargo temperature during his daily rest period when the temperature rose. Furthermore, the supplier considered it an act of gross negligence that they had not been contacted immediately when the error was identified. In the other event, the responsible manager ignored several alarms because he knew the truck was parked by a ramp and, therefore, assumed the truck was being unloaded.

The carrier denied liability for the loss and contested that it was proven that the medicine was fit for sale before it was delivered to the drivers. Furthermore, it denied gross negligence in both events.

The Maritime and Commercial High Court: Liability for the loss, but only gross negligence in one of the events

The court found that the damage on the medicine happened while this was in the carrier’s custody and accordingly the carrier was liable for the damage.

In the first event, the court found that the damage was caused by an IT-error and not by the driver’s lack of supervision with the temperature. According to the contract, the driver was not obliged to supervise the temperature since the carrier did this through the alarm system. Furthermore, the court found that the cargo was already damaged when the error was eventually identified, and so it did not make any difference that the supplier was not contacted immediately. Therefore, the carrier was able to limit their liability pursuant to the CMR act, s. 31, subs. 2, cf. s. 29, subs. 2.

In the other event, the court ruled that the responsible manager had set aside fundamental responsibilities by ignoring the alarms and, thereby, acted with gross negligence. Therefore, the carrier could not rely on limitation of liability, cf. the CMR act, s. 37.

IUNO’s opinion

This decision shows how the CMR act, s. 37 is applied. The court assess each case separately and weighs up the actions and omissions on a case by case basis. Breach of contract or instructions can mean that a damage is considered caused with gross negligence, but it is also decisive that this breach has caused or contributed to the loss. In other words, a causal connection between the breach of contract and the caused damage is needed. Furthermore, it cannot be agreed by contract what is to be considered gross negligence.

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Poulsen

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Aage

Krogh

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Lars

Rosenberg Overby

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