International Trade Law
The issue is whether Strongbow Pty Ltd can sue Korean Airline for the damage of the goods and the value of any compensation which may result from such an action.
Did the Montreal Convetion apply?
Before 2008, The Civil Aviation (Carrier's Liability) Act 1959 (Cth) incorporated into Australian law the Convention for the Unification of Certain Rules Relating to International Carriage by Air (Warsaw Convention) Warsaw which established between member states a uniform liability framework for air carrier at a time when aviation was a new industry. The Warsaw ...view middle of the document...
Based on Schedule 1A of the 1999 Montreal Convention Article 39, there is a contract between Korean Airlines and Qantas to carry the goods on a Qantas Australian domestic flight from Melbourne to Sydney. In this case Korean Airlines is the contract carrier and Qantas is the actual carrier.
Article 40 says if an actual carrier, Qantas, perform part of carriage which is governed by this Convention, both actual and contracting carrier shall be subject to the rules of this Convention.
Who is liable for the loss?
Based on article 18 (1), the carrier is liable for damage sustained in the event of the destruction or loss of, or damage to, cargo upon condition only that the event which caused the damage so sustained took place during the carriage by air. Art. 18 (3) says carriage by air is defined to include the whole period during which the cargo is in the charge of the carrier.
The goods were damage because when they were unloaded from Qantas flight in Sydney, they were left on tarmac for about five hours and there was very heavy rain during that time.
Qantas as the actual carrier from Melbourne to Sydney has performed his obligation to deliver the goods well. They have unloaded the goods in Sydney in same condition as they received the goods in Melbourne. Therefore Korean Airline is responsible to take care of the goods. In others words, the contract between Qantas and Korean Airlines end here.
After the goods were unloaded from Qantas flight in Sydney, it become Korean Airline responsibility to handle and store the goods properly before they were loaded to Korean Airlines flight to Seoul. The goods were left on tarmac for about five hours and there was heavy rain that make the cartons were torn and wet, and the pill box inside were found to be so damage and that they were unsalable.
Thus, Korean Airlines liable for the damage of the goods.
Korean Airline's defence
To avoid liability, Korean Airline must prove that one or more of the exception listed in Article 18 applies. Article 18 (2) provides that the carrier is not liable if and to the extent that it proves that...