Legal
Back to just one clause this month, Clause 12 which refers to customer instructions to take actions on their behalf. As a forwarder, the author remembers using clause 12(B) when asked to send goods by airfreight, charges collect, and there was a dispute at destination regarding the terms of sale. Using the BIFA STC, my customer had indemni fi ed me against such circumstances. Know your 2021 BIFA Standard Trading Conditions Clause 12
Clause 12(A) Except under special arrangements previously made in writing by an officer of the Company so authorised, or made pursuant to or under the terms of a printed document signed by the Company, any instruction relating to the delivery or release of goods in specified circumstances (such as, but not limited to, against payment or against surrender of a particular document) are accepted by the Company, where the Company has to engage third parties to effect compliance with the instructions, only as agents for the Customer. Clause 12(B) Despite the acceptance by the Company of instructions from the Customer to collect freight, duties, charges, dues, or other expenses from the Consignee, or any other Person, on receipt of evidence of proper demand by the Company, and, in the absence of evidence of payment (for whatever reason) by such Consignee, or other Person, the Customer shall remain responsible for such freight, duties, charges, dues, or other expenses. Clause 12(C) The Company shall not be under any liability in respect of such arrangements as are referred to under sub-clause (A) and (B) hereof save where such arrangements are made in writing, and in any event, the Company’s liability in respect of the performance or arranging the performance of such instructions shall not exceed the limits set out in Clause 26(A) (ii) of these conditions. Comment on Clause 12(A) The intention of this clause is to divert claims to those third parties that have to be engaged to carry out
such instructions. Liability for non- compliance with such instructions will depend on the extent that such instructions were passed to such third parties by the BIFA Member. Liability cannot always be excluded or limited under this clause when the BIFA Member acts as a carrier (whether or not sub-contractors are used) in a contract for international road carriage because Art 21 of the CMR Convention overrides this clause in respect of cash on delivery collections. Also, the BIFA Member cannot claim an agency role and the involvement of third parties when the goods are released by the BIFA Member’s own agent at destination without production of an original bill of lading issued by the BIFA Member as carrier. Comment on Clause 12(B) This clause is regarded as something of a mirror image of Clause 12(A) but instead of referring to the liability of the Company and limiting that liability, Clause 12(B) refers to the Customer’s responsibility to pay uncollectable charges in full. When in accordance with the Customer’s instructions, services are performed by the BIFA Member or charges are paid out by the BIFA Member, the BIFA Member is entitled instructions require the BIFA Member to look for payment from another party. In those circumstances, the BIFA Member may find itself unable to collect the charges from another party. The Customer may equally be unable to recover the charges and Clause 12(B) is intended to make the Customer, and not the BIFA Member, the innocent party who has to be paid or reimbursed. Sometimes the Customer’s
illustrated by the case EW Taylor (Forwarding) Ltd v Bell, Lloyd’s Rep [1968] 2 63, which prompted the insertion of such a clause in all the BIFA and IFF STC since 1970. The 1968 case referred only to freight charges and Clause 12(B) of the BIFA 2021 STC refers to all charges and expenses. Clause 12(B) holds the Customer responsible for uncollectable charges, etc, when the BIFA Member provides evidence of a demand for It is important for a BIFA Member to establish its true customer. For goods routed by the consignee, either by a direct dealing or through an overseas agent, the BIFA Member’s true customer would normally be the consignee who stipulated the routing through the services of the BIFA Member and not the sender. For routed consignments, application of Clause 12(B) against the Customer may be deemed unreasonable in respect of charges that are the responsibility of the BIFA Member’s true customer. Comment on Clause 12(C) This clause states that any liability on the part of the BIFA Member in payment, unless evidence of payment is provided by the Customer. respect of such arrangements under Clause 12(A) and 12(B), unless they are made in writing, and any liability on the part of the BIFA Member shall be limited to that under Clause 26(A) (ii) of the BIFA 2021 STC. The limitation of liability under Clause 26(A) (ii) is the value of the goods of the whole consignment or 2 SDR per kilo of the gross weight of the whole consignment, or a cap of 75,000 SDR, whichever is the least, unless the actual financial loss is less than any of those amounts.
“ The intention of Clause 12(A) is to divert claims to those third parties that have to be engaged to carry out such instructions
to bear the financial loss. Such circumstances are
22 | May 2023
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