Schenker International (Australia) v Siemens Ltd

The appeal concerned a dispute between Schenker International (Australia) Pty Ltd (the carrier) and Siemens Ltd (the consignee) regarding damage to goods during air carriage. The primary issue was whether the carrier's liability for the damage was limited by the provisions of Chapter 3 of the *Civil Aviation (Carriers Liability) Act 1959* (Cth) and, specifically, Articles 18 and 22 of the First Schedule to that Act. The consignee argued that the damage was caused by the carrier's negligence, and that a clause in the airway bill did not effectively limit the carrier's liability in such circumstances. The matter came before the Court of Appeal of New South Wales.

The central legal questions before the Court of Appeal were: (1) whether Chapter 3 of the *Civil Aviation (Carriers Liability) Act 1959* applied to the carriage of the goods in question; and (2) if Chapter 3 did apply, whether Clause 4 of the House Airway Bill operated to limit the carrier's liability for damage caused by its negligence.

The Court of Appeal found that Chapter 3 of the Act did apply to the carriage of the goods. Crucially, the Court held that Article 18 of the First Schedule to the Act, which deals with the carrier's liability for damage to goods, imposed strict liability on the carrier for loss or damage occurring during carriage by air. The Court further determined that Clause 4 of the House Airway Bill, which sought to limit the carrier's liability, was ineffective to exclude liability for negligence, as it did not clearly and unambiguously achieve that result in light of the statutory provisions. The Court reasoned that the statutory regime under Chapter 3 provided a specific framework for carrier liability, and any attempt to limit that liability must be construed strictly and in accordance with the overarching statutory purpose.

The appeal was allowed, and the orders of the primary judge were set aside.