Explanations of the Russian Supreme Court regarding transportation by motor vehicles and freight forwarding activities

Pepeliaev Group advises that the Plenum of the Russian Supreme Court (the “Supreme Court”) has provided explanations on a number of matters which arise in the practice of the application of legislation concerning contracts for transportation by motor vehicles of cargo, passengers, and luggage, and freight forwarding contracts[1].

The Resolution contains a number of key explanations with respect to matters arising in the application of current legislation. Below we examine these explanations in more detail.

A CONTRACT FOR THE TRANSPORTATION OF PASSENGERS AND LUGGAGE

• Charging for issuing a ticket. A carrier may not charge a client any additional fee for the issuance of a travel ticket. Such fee may only be charged by an agent if such agent’s services are used to execute a contract for transportation.
• Liability of a carrier:

o A carrier is liable for the actions of third parties it engages to carry out transportation, as for its own actions.

o A carrier is liable for the loss of luggage when a vehicle is parked at a parking lot when en route.

o A carrier is liable for the loss or shortage of or damage to luggage if the carrier has assumed responsibility to pack the luggage or if at the moment when the luggage was accepted, the defects of the packaging were obvious or were known to the carrier. The burden of proof that luggage has been lost or damaged owing to improper packaging lies with the carrier. The same approach applies to the liability of a carrier/freight forwarder for the loss or shortage of, or damage to, the cargo.

o Losses incurred by a passenger owing to a delay in the shipment of luggage are to be reimbursed in full in addition to the amount of penalties payable by a carrier.

o A carrier is held liable for the harm inflicted on the passenger’s belongings owing to an unsatisfactory condition of the compartment of a vehicle used for transportation.

· Liability of taxi aggregators. A person to whom a client turns seeking to enter into a contract is liable for the harm inflicted on a passenger during transportation if: such person has entered into a contract for transportation on its own behalf; or the circumstances under which the contract was entered into could have led a good-faith individual consumer to believe that such contract was being made with a taxi aggregator and the actual carrier is an employee of the aggregator or is a third person engaged to perform the obligations of transportation.

CARGO TRANSPORTATION CONTRACT

• Criteria for classification as a cargo transportation contract. One of the main criteria for classification as a cargo transportation contract is the obligation of a carrier to ‘deliver the cargo unharmed’. If this criterion is missing from the contract the provisions of the Russian Civil Code and the Charter[2] with respect to cargo transportation do not apply to such contract.
• Liability of a shipper. The amounts paid by a carrier to third parties in connection with the lack of data, or with inaccurate or insufficient data, contained in the documents intended for unhindered shipment of the cargo should be reimbursed by a shipper to a carrier.
• Liability of a carrier/freight forwarder.

o A freight forwarder that has accepted cargo from a client without any reservations made in the transportation documents with respect to improper packaging is liable for the risks related to the possible loss of or damage to the cargo arising in relation to such circumstance.

o A penalty (fine[3]) payable by a carrier for a delay in the delivery of a cargo is recovered in the form of a fine, on top of the amount of the losses caused by such delay in the delivery of the cargo.

THE CORRELATION BETWEEN THE OBLIGATIONS OF A CARRIER AND A FREIGHT FORWARDER

• A freight forwarder is liable for the damage caused to a cargo or the loss of a cargo if a freight forwarder is the actual carrier, or if a freight forwarder has in any way expressed its intention to guarantee delivery of the cargo unharmed (including if the provisions of the contract do not entitle the client to choose specific carriers or if the price for the services of the freight forwarder is set as a fixed amount with no specification of the transportation costs and is comparable to the market prices for the transportation of the corresponding types of cargo).
• A lawsuit to recover actual harm in a case of a loss or shortage of or of damage to the cargo may be brought by a client against a carrier as well as against a freight forwarder if the latter, under the contract made with the client, is obliged to ensure transportation of the cargo unharmed. In this case a carrier and a freight forwarder are jointly and severally liable to a client.
• A freight forwarder that has entered into a contract on its own behalf is entitled to demand that a carrier compensates the actual harm caused by damage to or the loss of cargo regardless of whether a freight forwarder compensated the client for the harm caused by a damaged or lost cargo.

CLAIMS AND LAWSUITS UNDER DISPUTES RELATED TO THE TRANSPORTATION OF PASSENGERS AND LUGGAGE, CARGO AS WELL AS FREIGHT FORWARDING SERVICES

• Procedure for calculating the statute of limitations. The statute of limitations under a lawsuit against an actual carrier initiated by a freight forwarder which is not a shipper but which is liable for the transportation of cargo unharmed does not depend on the moment when the freight forwarder compensated a client for the losses; such statute of limitations runs similarly to cases when a freight forwarder is at the same time a shipper (starting from the day of the incident which caused the claim or the lawsuit to be initiated).

What to think about and what to do

A number of provisions contained in the Resolution are aimed at imposing stricter liability on carriers, legal entities and individual entrepreneurs providing transportation services as well as taxi aggregators involved in the business of the transportation of passengers and luggage. It is advisable for those involved in this business to familiarise themselves with these new explanations and take them into account as they work with consumers (passengers) as well as counterparties.

Help from your adviser

Pepeliaev Group’s experts are ready to provide comprehensive legal support on matters concerning the interpretation and practical application of the explanations of the Supreme Court contained in the Resolution.