It is in the nature of liability regimes, which carve out an area of the business world and subject it to regulation, that difficulties will arise in adjusting business practice to accommodate the new requirements. The CMR1 Convention is no exception and adds to the inevitable discomfort by the uncertainties that arise in relation to its application and in determining exactly what its requirements are. Two recent decisions of the Commercial Court are of interest in highlighting aspects of these problems and for the several issues of interpretation that they raise.

The first is A.B. Bofors—U.V.A., C.A.V. Ltd., and George Kuikka Ltd. v. A.B. Skandia Transport and Others.2

Swedish forwarders, in combination with English sub-contractors, organized the carriage by road of a grinding machine from Sweden to England. In the course of carriage and while the machine was being transferred from one sub-contractor to another, it was dropped and damaged. The plaintiffs, who were the Swedish manufacturers, the named consignee and the ultimate receiver, began proceedings in England against those involved in the carriage, but the Swedish forwarders applied for a stay of proceedings on the grounds that an arbitration clause in the conditions of the carriage contract provided for arbitration in Sweden. The stay having been refused by the master, the defendants appealed to Bingham, J., in the Commercial Court.

A major concern of the plaintiffs was that the arbitration clause contained a time bar and that if the suit was stayed they might not be in time to bring the arbitration proceedings in Sweden. Could they impugn the arbitration clause? There were two lines of attack. Firstly, that the arbitration clause should be restrictively interpreted so as not to apply to claims brought outside Sweden, and secondly, that it was invalid under CMR, which was accepted as being applicable to the contract.

The clause in question was part of the “Nordic Conditions” incorporated into the waybill. These are generally used by Scandinavian forwarders in their operations and are designed to cover all forms of transport and forwarding activity throughout Scandinavia. The relevant clause was headed: “Only applicable in Sweden and Finland” and stated: