In reasons dated 7 March 2008, Justice Hugessen of the Federal Court of Canada rendered judgment in favour of the plaintiff forwarder Locher Evers International (LEI). The principal claim was for approximately $215,000 in outstanding charges arising out of more than 50 transactions over a period of three months; awards for interest and costs round out the total amount. The defendant importer had refused to pay based on set-off for a cargo damage claim, as is often the case. Gavin Magrath of Magrath O’Connor LLP acted as counsel for LEI.
A number of legal issues had to be resolved in favour of the forwarder in order to obtain this result, including:
1) establishing subject-matter jurisdiction of the Federal Court;
2) incorporating the CIFFA standard trading conditions by reference into the contract for credit and carriage, as the actual bills incorporating the conditions would not have been delivered to the importer until after the contract was formed; and
3) establishing the legal and equitable obligations on the importer to pay for freight charges, regardless of claimed set-off for cargo damage.
The Court found as a matter of fact that LEI had taken all reasonable steps to bring the STC’s to their customer’s attention, including incorporating them into the signed credit agreement, noting them on the face as well as the reverse of the bills, and also in the automatic signature of outgoing email rate quotations. Accordingly, this case stands as a reminder that when they take care to manage their legal obligations carefully Forwarders will be well protected by the law.
Locher Evers International v. Canada Garlic Distribution Inc., [2008] FCJ 388; (2008) FC 319.
