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Will the Supreme Court overturn the House of Lords' decision in Buchanan v Babco?

11 November 2022

James Buchanan & Co Ltd v Babco Forwarding & Shipping (UK) Ltd [1978] AC 141 ("Buchanan") is the most famous CMR Convention case.  It was decided by the House of Lords in 1978, but is set to be reviewed by the Supreme Court on 28 February 2023.

The CMR regulates the international carriage of goods by road between contracting countries.  Amongst other things, it sets out who is liable (and for what) when cargo is lost, stolen, damaged or delayed. 

Buchanan decided that when cigarettes or alcohol are stolen, the excise duty is recoverable from the carrier under Article 23(4) of the CMR.  This is a significant decision because the value of excise duty is far greater than the value of such goods.  

Buchanan has faced criticism by leading English commentators, the English Court of Appeal in Sandeman Coprimar SA v Transitos Intergrales SL [2003] EWCA Civ 113 and in certain foreign courts.

DWF is acting on behalf of the carrier in the case of JTI Polska v Mark-Trans-Sped, which concerns the theft of a consignment of cigarettes that were being delivered from Poland to England. The goods were worth £72,512.15 and the excise duty was £449,557. The carrier accepted at first instance that it must lose because Buchanan, which was decided by a higher court, is a binding precedent.  However, we successfully applied for permission to appeal directly to the Supreme Court (the House of Lords' successor as the UK's highest Court), arguing that Buchanan was wrongly decided. 

If Buchanan is overturned, it will have significant implications for carriers and insurers.

DWF's team comprises Darren Kenny, Ben Griffin and Stephanie Sandford-Smith.  Counsel are John Kimbell KC and Maya Chilaeva of Quadrant Chambers. 

Contact Darren Kenny, Ben Griffin and Stephanie Sandford-Smith for more information. 

Further Reading