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Roy Bowles win ‘RHA carriage conditions' appeal
Page 63
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• Roy Bowles Transport have successfully appealed against a ruling last year that negligence by a carrier was excluded from Clause 3 (4) of the Road Haulage Association 1967 conditions of carriage.
The Court of Appeal ruling was on the RHA indemnity clause providing that a trader should keep the carrier indemnified against all claims or demands whatsoever in excess of £10 on any consignment. The Court found that this was wide enough to require a trader to indemnify the carrier against a claim of £998 for the loss of three gold watches arising out of the negligence of the carrier's own servant. Roy Bowles were given judgment for £998 less £10.
The previous judgment affected both goods-in-transit insurance policies and the 1967 conditions of carriage. It curtailed a haulier's ability to claim from a third party, such as a forwarding agent, any amount in excess of the limits set by the conditions if he had been successfully sued for loss of goods through negligence.
It had been accepted that since the introduction of the 1967 conditions that hauliers could claim back from traders any excess amount over the limit set by the conditions for which they had been successfully sued.
As a result of the judgment last year, the 1967 conditions were clarified by an amendment in Clause 3 (4) bringing in the word "negligence".
The appeal, Gillespie Bros and Co v Roy Bowles Transport and Rennie Hogg Ltd (third party) was heard by Lord Denning, Master of the Rolls, Lord Justice Buckley and Lord Justice Orr.
Lord Denning said that two contracts underlay the transaction, the first being between the owners (Gillespie) and the forwarding agents (Hogg). That had the result that the owners did not sue the forwarding agents but the carriers in tort. The second contract was between the forwarding agent and the carriers made subject to the conditions of the RHA. It included a limit of liability to any one consignment save that nothing limited the liability below £10.
The carriers based their charges and insurers calculated their premiums on the footing that the limitation was valid and effective between all concerned. The law should support the course of trade and uphold the limitation. But it had not done so.
The indemnity relied on by the carriers was designed to enable them, when sued by the goods owner, to come down on the trader — the forwarding agents. The words of Clause 3 (4) were clearly wide enough to cover the present case.
The indemnity clause was reasonable. It was fair to put the responsibility above £10 on the forwarding agents and the appeal should be allowed.
Lord Justice Buckley and Lord Justice Orr concurred and said Clause 3 (4) constituted an agreement in express terms to indemnify the carrier against all claims and demands without exception and therefore including those arising from the negligence of the carrier or his servants.