Article 8 IATA Standard Ground Handling Agreement

1 Article 8 IATA Standard Ground Handling AgreementSome Relief for Carriers?Prof. Dr. Wolf M ller-Rostin, BonnArticle 8 Liability and as stated in Sub-Art. the Carrier shall not make any claims againstthe Handling Company and shall indemnify it against any legal liability for claims or suits, including costs and expenses thereto, in respect of: .. 2 Sub-Art. (a)..(b)..(c)..(d)damage to or loss of property owned or operated by, or on behalf ofthe Carrier and any consequential loss or damage;arising from an act or omission of the Handling Company in the performance of this Agreementunless done with intent to cause damage, .. or loss orrecklessly and with knowledge that damage, .. or loss would probably does Sub-Art.

2 Mean?No liability for damages to aircraft and no liability for consequential damages aslong as either type of damages is caused by negligenceor in other wordsHandling Company liable for direct and consequential damages (indirect damages) in case of intent or recklessness4Re-Inclusion of Liability for Negligence (Sub-Art. , para1)Notwithstanding Sub-Art. (d), the Handling Company shall indemnify theCarrier against any physical loss of or damage to the Carrier s Aircraft caused by the Handling Company s negligent acts or omissions PROVIDED ALWAYS THAT theHandling Company s liability shall be limited to any such loss of or damage to theCarrier s Aircraft in an amount not exceeding the level of deductible under the Carrier s Hull All Risk Policy which shall not, in any event, exceed USD 1,500,000 except that loss or damage in respect of any incident below USD 3000 shall not beindemnified.

3 5 Sub-Art. , para2 For the avoidance of doubt, save as expressly stated, this Sub-Art. does not affect or prejudice the generality of the provisions of Sub-Art. including the principle that the Carrier shall not make any claim against the Handling Company and shall indemnify it against any liability in respect of any and all consequential loss or damage howsoever arising. 6 IATA SGHA as general terms and conditions of businessSGHA held by earlier decision (OLG Frankfurt, ZLW 2000, 412) to be general terms and conditions of businessAs such their reasonableness and their validity used to be regulated by the Unfair Contract Terms Act, now incorporated into Civil CodeFocus of provisions is to protect the injured party which has transacted on the other party s general terms of business.

4 7 Plaintiff s 8 is not clear and not transparent, in particular:Sub-Art allows claims for consequential damages in case of recklessness and intenthowever, the clause in Sub-Art.. the Carrier shall indemnify the Handling Company against any liability in respect of any and all consequential loss or damagehowsoever arising takes away what has been granted in Sub-Art. and are invalid as they exclude liability for violation of core duties 8 Defendant s Arguments1. SGHA not general terms of business, but trade practice, practice commonly observed by persons conversant in a particular trade, as such not to be measured by Unfair Contract Terms Act2. IATA SGHA has been drafted by the airlines IATA representing interest of the airlines why would an airline reject its own conditions?

5 3. Art. 8 is a clear and transparent allocation of risk9 Court s Decision (I)(not res iudicatayet)SGHA nota trade practiceArt. 8 is clear and transparent: Sub-Art. limits handler s liability for direct and indirect damages to recklessness or intent Sub-Art. extends the liability to negligence, but only for direct damages Sub-Art. , para2 affirms limitation of liability for consequential damages10 Court s Decision (II)However, Sub-Art. invalid as it puts the contractual partner of HandlingCompany at an unreasonable disadvantage: Exclusion of liability for violation of a core duty of the contract is not valid, unless specifically agreed between parties Exclusion by printed Standard forms is not permissible decided by BGH (NJW 2005, 422) in respect of direct and indirect damages, in respect of indirect damages at least when damages are foreseeable and typical11