Court upholds claim for damage to perishable cargo

Court upholds claim for damage to perishable cargo

Wealmoor Ltd -v- K.L.M. Cia Real Holandesa De Aviacion & another [2025] EWHC 1706 (Comm)

In this case, the Court has found that an airline company was liable for damage sustained by a perishable cargo during its carriage by air. While the claim amount was modest, the dispute merited the Court’s attention because it was asked to deal with a novel point arising in respect of the interpretation of article 18(1) of the Montreal Convention 1999, which addresses damage to cargo.

For those dealing with marine cargo claims, the decision is interesting because a number of the issues that arose in this air carriage case are similar to the type of issues that can arise in cargo damage claims subject to the Hague or Hague-Visby Rules, for example whether damage was sustained pre-shipment, appropriate care and handling of perishable cargo during carriage and whether the inherent vice or defective packing exceptions to liability apply.

The background facts

The parties

The claimant specialises in importing subtropical fresh fruits, vegetables and other items and receives numerous shipments, including air shipments, at its UK packhouse on a daily basis. 

The claimant claimed damages against the defendants (KLM) in respect of damage to a consignment of 500 boxes of fresh green asparagus carried under an air waybill (AWB) dated 9 January 2021 for a flight from Lima, Peru to London Heathrow. 

The claimant was the consignee under the AWB and the defendants were the contractual carriers of the cargo.

The asparagus was provided by an established Peruvian asparagus producer, Floridablanca, with whom the claimant had worked since 2018. On the evidence, the claimant received about four shipments of asparagus per week from Floridablanca.

Care of the cargo prior to shipment

Asparagus is prone to respiration, which can cause irreversible deterioration. Temperature is key to controlling the respiration, the higher the temperature the greater the rate of respiration. Post-harvest cooling is imperative and carriage at 2-8 C is required (lower temperatures are recommended but, in practice, are not achievable).

The claimant had very specific requirements set out in its Procurement Specifications that Floridablanca had to work to with regard to the quality, maturity and handling of the asparagus. Floridablanca also had its own fixed procedures for dealing with the cargo from harvesting to being placed on a truck to travel to the airport. 

The cargo was transported by truck to Lima airport on 8 January 2021 and was kept at a controlled temperature of 3-6 C. The “cool chain” was started in the packhouse and maintained throughout the journey to the airport. The cargo arrived at Lima airport early morning on 9 January, after a journey of 5 to 6 hours. 

KLM’s ground handling agents accepted the cargo and took the temperature of each pallet, which ranged from 4.7C to 6.5 C. Before the cargo was delivered to KLM’s agent in Lima, each of the pallets in which it was contained were wrapped in a mesh known as malla raschel for pest control purposes. 

It was common ground and subsequently agreed by the parties’ experts in their Joint Memorandum, that the cargo was in good condition when delivered to a warehouse controlled by KLM. The cargo was within KLM’s control from that point onwards and on 10 January 2021 at 10:52-11:26 local time was loaded onto a flight from Lima.

The contract of carriage

The claimant’s agent had booked the carriage of the cargo on a flight with KLM via Amsterdam and the cargo was to be carried on KLM’s “Specialised Fresh +2+8” or “Temperature Controlled” service (Fresh 2) for perishable goods that are stored and transported at temperatures between +2 C and +8 C. This was recorded on the AWB in the Accounting Information Box as follows:

"SPECIALIZED FRESH+2+8 VEGETABLES=FRESH 2"

The AWB also recorded over the central part where weight is recorded: 

"FREIGHT PREPAID PERISHABLE ... TOP ... URGENT ... KEEP ... ON ... REFRIGERATION"

It was common ground that the description of “Fresh 2” was set out on KLM’s website as follows, without further explanation:

"Temperature Controlled

Specialized Fresh+2+8: for temperature sensitive perishables, such as flowers, fresh fish, vegetables and fruits.
During warehouse-and ramp handling, shipments can be exposed to ambient temperatures.

• Temperatures of between +2°C and +8°C
• Warehouse storage, road- and air transportation at temperatures between +2°C and +8°C"

KLM’s General Conditions of Carriage applied to the contract recorded in the AWB and provided in clause 6.3 for “Schedules, Routings and Cancellations.” Pursuant to this provision, KLM could deviate from the route agreed in the AWB, was not bound to times shown in its timetable and only had to undertake the carriage with reasonable despatch.

The flight

Notwithstanding what was provided in the AWB, the flight was routed via Quito and Miami and the cargo spent considerable time in the cargo hold on the ground in conditions above the necessary 2C-8C as well as during ascent and descent between various stops.

Records of the temperature in the pallet in which the cargo was wrapped, together with related data, led the experts to conclude that the cargo was likely damaged by the time of its arrival at Amsterdam on 12 January as a result of respiration during transport. The cargo was trucked from Amsterdam to London, arriving at Heathrow early morning on 13 January.

By the time the cargo was collected by the claimant’s agents, the temperature recorder showed a temperature of approximately 28.8 C and logged temperatures of no less than 11 C from the arrival of the cargo at Amsterdam.

The damage

Upon inspection, the cargo displayed discolouration, rotting and dehydration, with a strong rotting odour throughout. It was found not to meet the required quality specification. The pulp temperature of the cargo was recorded as being between 18.5 and 34.5 C, well in excess of what is acceptable for asparagus.

The claimant sold some of the cargo as distressed cargo and the remainder had to be destroyed.

The claim

The claim was brought under article 18(1) of the Montreal Convention 1999 (the Convention), as incorporated into UK law by statutory instrument. In relevant part:

"Article 18—Damage to Cargo

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.

2. However, the carrier is not liable if and to the extent it proves that the destruction, or loss of, or damage to, the cargo resulted from one or more of the following:

(a) inherent defect, quality or vice of that cargo;

(b) defective packing of that cargo performed by a person other than the carrier or its servants or agents;…"

Liability under article 18(1) is strict provided the event which caused the damage to cargo took place during the carriage by air, unless one of the exceptions applies.

The defence

KLM disputed liability on the basis that there was no “material event” during the carriage by air. Further or alternatively, it relied on the inherent vice and/or defective packing exceptions to liability under article 18(1).

The Commercial Court decision

“Event”

On the authorities, the Court found that “event” in article 18(1) did not equate with “accident,” having a wider meaning. An event was something that caused damage to be sustained by the cargo during its carriage by air and was something additional and external to that damage. Furthermore, an “event” did not have to be fortuitous. It may include deliberate actions by the carrier e.g. turning off the refrigeration.

In this case, on the evidence, KLM had not complied with its “Fresh 2” terms of carriage in that no temperature control was applied to maintain the agreed temperature range following loading, during descent and while on the ground at intermediate stops en route for the ultimate destination.

Those periods when the refrigeration was turned off, and the leaving of the cargo in conditions of high ambient temperatures during carriage, notwithstanding that they were clearly regarded as standard by KLM’s claims handler in the evidence she gave to the Court, supported the conclusion that there were “events” in the carriage of the asparagus that were capable of falling within article 18(1).

The Court concluded that the turning off of the refrigeration in the cargo hold during aircraft descent and the allowing of the temperature of the cargo hold to increase (above the contracted range), including by the opening (and leaving open) of the cargo door while on the ground at Quito, and leaving the cargo in ambient temperatures over 10°C for more than seven hours other than during “warehouse-and ramp handling” were each an “event” within article 18(1).  Additionally, the placing of the cargo located it near the cargo door which may have exacerbated the exposure to higher temperatures.

Article 18(2) exceptions

The Court dismissed the defence of “inherent vice.” Whether there was an inherent defect, quality or vice of the cargo in issue had to be assessed by reference to the nature of the service contracted for – see the House of Lords decision in The Albacora [1966] 2 Lloyd’s Rep. 53.

In this case, KLM had not complied with the terms of the contract of carriage into which they entered with regard to the refrigeration and care of the cargo. The carriage of the asparagus at the stipulated temperature range of 2-8 C was standard commercial practice and there was no evidence that the use of that range (if properly observed) gave rise to damage. 

While KLM’s expert had sought to argue that the mesh wrapping had caused the damage, the Court found on the evidence that the use of malla raschel was common practice in the consignment of asparagus from Peru and had been used by the claimant without complaint since 2010. Its use was because of US requirements with regard to quarantine from insects coming from Peru. The carrier had also not raised any concerns with it on receipt. Therefore, the “defective packing” exception did not apply.

In conclusion, KLM was liable for the claimant’s loss.

Comment

Among other things, the case shows the importance of having very specific and express procedures in place for handling perishable cargo pre-shipment, during carriage and post-delivery. All steps taken to care for the cargo should be carefully documented.

The dispute also highlights the importance of carefully considering your expert evidence. The Court did comment that one of the experts in this case seemed more inclined to argue the position he had first taken on behalf of the party instructing him rather than giving the Court an objective expert view based on a proper consideration of the evidence.