Mohorade – Isola – Serravalle – Mainero Abogados

5TH INTERNATIONAL CARGO RECOVERY
CONFERENCE
New York & Montreal, June 2016
RECOVERY OF TRANSPORT CARGO CLAIMS
IN ARGENTINA
Leonardo José Mainero
www.mohorade.com.ar leonardo.mainero@mohorade.com.ar
Mohorade – Isola – Serravalle – Mainero
Abogados

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Abogados
ARGENTINA: FEDERAL COUNTRY
CONTINENTAL CIVIL LAW SYSTEM
NEW CIVIL & COMMERCIAL CODE: AUGUST 2015
SPECIAL LEGISLATION REMAINS IN FORCE:
INSURANCE – NAVIGATION - TRANSPORT.

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I.- REGULATIONS - LEGAL BASIS OF CARRIAGE IN ARGENTINA
A) Carriage by Sea: (Under B/L).
- International Transport by sea: Brussels Convention on Bills of Lading 1924 (The Hague
Rules).
- International Transport in brown waters (Waterway Paraguay-Paraná): Argentina, Bolivia,
Brazil, Paraguay, Uruguay. Applicable law of the port of discharge.
- Domestic Transport: Argentinean Navigation Act. (Hague Rules + Brussels Convention
1910 on Collisions between Vessels + Brussels Convention 1910 on Salvage). The Argentinean
Navigation Act of 1973 incorporated the principles of the 1924 Convention as well as the
majority of those laid down by the Protocol of 1968 (The Visby Rules). However, Argentina did
not ratify such Protocol.
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B) Carriage by Air:
- International Transport: Montreal Convention of 1999 for the Unification of Certain Rules
for International Carriage by Air.
- Domestic Transport: Argentinean Aeronautical Code.
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C) Carriage by Rail & Road:
• International Transport:
The Argentine Republic adhered to some Conventions with neighbour countries, such as:
a) Commercial Terrestrial Law Treaty of Montevideo, 1940, with Paraguay and Uruguay,
b) Convention on International Terrestrial Transport of Santiago, 1991, with Brazil, Chile,
Paraguay, Uruguay and Bolivia,
. Domestic Transport: Argentinean Civil & Commercial Code.
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D) Multimodal Transport:
• International Transport: No Convention in force.
• Domestic Transport: Argentinean Multimodal Act.
E) Warehouse / Port Terminals:
• International Transport: No Convention in force.
• Domestic Transport: Argentinean Civil & Commercial Code or Argentinean Multimodal Act.
IMPORTANT: IN ARGENTINA, THE MOST CHARACTERISTIC LENDING OF A CARRIAGE
CONTRACT (BY SEA, AIR, ROAD, RAIL AND MULTIMODAL) IS TO DELIVER THE
CARGO AT DESTINATION. (Inbound traffic, jurisdiction and applicable law).
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II.- RELEVANT TIME-BARS FOR OCEAN, ROAD, RAIL AND AIR
SHIPMENTS IN ARGENTINA
1) TIME - BAR:
The time bar period is fixed by Statute. It is a mandatory matter (Public Order). It is not
possible to reduce the time bar period fixed in a Convention or an Act by a private agreement
between the parties, or stating a clause in a bill of lading. A time to suit clause is not valid in
Argentina, if the time bar period stipulated in the contract is lower than the statutory period.
A) Carriage by Sea:
Time Bar is the same for international or domestic transport: One year.
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II.- RELEVANT TIME-BARS AND TIMES TO CLAIM FOR OCEAN, ROAD,
RAIL AND AIR SHIPMENTS IN ARGENTINA
1) TIME - BAR:
B) Carriage by Air:
• International Transport: Two years.
• Domestic Transport: One year.
. Time Bar is the same for international or domestic transport: Two years. (Place of destination:
Argentina). Actions in contract.
. Claims against third parties (Not carriers): Three years, Actions in tort.
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1) TIME - BAR:
Time Bar is the same for international or domestic transport: One year.
Time bar depends on how the action is based:
Actions under Multimodal Contracts: Argentinean Multimodal Act: One year.
Actions in Tort: Three years.
Contractual Actions: General time bar period for contracts in Argentina: Five years.
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2) SUSPENSE OF TIME BAR
According to Argentinean Civil & Commercial Code it is possible to suspend for six months the
time bar period if the defendant is formally put on notice of the cargo claim, determining the
amount of money claimed.
In such a case, it is possible to obtain six additional months to file a complaint before the courts.
This can be done by out of court notification: Registered letter or demanding letter received by the
carrier.
Time bar period can also be suspended if claimant starts a mediation process. Time bar is
suspended during the mediation and if it is closed without agreement there are 20 running days to
file the complaint.
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2) SUSPENSE OF TIME BAR
Exception: Carriage of goods by air: The three Rooms of the Argentinean Civil & Commercial
Federal Courts decided that the suspense of time bar through an out of court notification is not
applicable in re “Ganadera Argentina Vs Aerolineas Argentinas”, August 1991.
But mediation process is valid to suspend time bar: Argentinean Supreme Court in re “Nastasi Vs
Aerolineas Argentinas”, October 2002.
Time Extensions are not frequently used in Argentina, but they are valid (Exception: Carriage of
goods by air).
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III.- NORMAL PACKAGE LIMITS FOR THE DIFFERENT TYPES OF
CLAIMS IN ARGENTINA
A) Carriage by Sea:
Article 4 paragraph 5 of the Hague Rules: 100 pounds sterling per package or unit.
Article 9 Hague Rules: Monetary Units - Gold Value.
One "Gold" Sterling Pound = 7.322 grams.
One troy ounce = 31.10348074 grams of gold
Quotation of Troy Ounce in New York Market = USD 1,214 (May 27th, 2016).
Calculation of the limit: 7.322 x 100 x 1,214 / 31.10348074 = USD 28,578.-
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CLAIMS IN ARGENTINA
A) Carriage by Sea:
• Domestic Transport:
Section 278 of the Argentinean Navigation Act: 400 pesos Argentinean gold.
The argentinean gold is an internal and ideal currency quoted every three months by the Argentinean
Central Bank.
The quotation for April - June 2016 is 4,209.10 AR$ each Argentinean gold.
1 Argentinean Gold = 5 Pesos Argentinean Gold.
The exchange rate USD/AR$ is 1USD = AR$ 14.20 (May 27th, 2016).
Actual limitation about USD 23,713.-
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CLAIMS IN ARGENTINA
B) Carriage by Air:
Article 22 paragraph 3 of the Montreal Convention 1999, reviewed as of 30 December 2014 (Limit
update): 19 SDR per kilogramme.
SDR Valuation: 1 SDR = USD 1.405830 (May 27th, 2016 - IMF).The actual limitation is USD 26.71 per
kilogramme.
A paramount clause on the reverse side of an AWB referring only to Warsaw Convention of 1929 or
the Hague Protocol of 1955 (Not Montreal 1975 nor Montreal 1999) as applicable law, may
increase the limit according to such regimes.
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CLAIMS IN ARGENTINA
B) Carriage by Air:
• Domestic Transport:
Section 145 of the Argentinean Aeronautical Code: 2 Argentinean gold per kilogramme.
(Actually USD 592 per kilogramme).
The value of the goods is rarely declared by the shipper and inserted in the airway bills as a
special statement, so insurance companies should consider such circumstance to
quote a higher premium amount of the coverage in case of valuable cargo of light
weight (Such as cellular phones, personal electronic equipment, watches), because the
recovery against carrier by air in those examples could be almost insignificant.
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CLAIMS IN ARGENTINA
There is no limit in international nor domestic transport (Except if the carriage of the cargo is part of a
multimodal operation).
Section 24 of the Argentinean Multimodal Act:
If the damage is located in the sea leg or in the air leg, the applicable limit shall be determined by
reference to the provisions of the convention or national law for the carriage of goods by sea or air.
In all other cases, (Damage not located or located in terminals or during carriage by rail or road) the limit is
400 pesos Argentinean gold = USD 23,713 per package or unit.
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III.- NORMAL PACKAGE LIMITS FOR THE DIFFERENT TYPES
OF CLAIMS IN ARGENTINA
In principle, there is no limit. Except if:
1) The depot services are part of a multimodal carriage of the cargo (So multimodal limit applies).
2) The damage or loss of the cargo occurred during loading or discharging operations from a vessel to a
port operator and therefore a "simple" Himalaya Clause is invoked (So carriage by sea limit applies).
F) Containers:
The limit of liability applies according to the number of packages or units enumerated on the front of the
bill of lading (In re “La Confianza Vs Salvador”, September 1989, 3 Rooms of Civil & Commercial Federal
Court).
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IV.- THE USUAL TIME FOR CASES TO BE PENDING IN ARGENTINEAN
COURTS BEFORE THEY EITHER SETTLE OR GO TO TRIAL
1) Out of Court Claim: 3 months. (Recovery Agents).
a) Copies of Supporting Documents.
2) Mediation Process: 3 months. (Only Lawyers).
a) Power of attorney.
b) Secret, easy.
c) Hearings.
d) Copies of Supporting Documents.
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2) Mediation Process: 3 months.
e) Mandatory before starting a legal action in court.
f) Costs about USD 500 (Excluding fees of the recovery lawyer).
g) Mediator has not power to issue a decision.
The strategy in 1) and 2) is to claim anyone that may have a contractual or tort link. No
problem with respect to costs and fees of surveyors nor opponent lawyers.
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3) Judicial Complaint: 5 years. (First Instance Judgement = 4 years + 1 year Appeal Court).
a) Solvency of defendant must be considered before starting the action.
b) Power of attorney (With Apostille).
c) Original documents (or to point out who has the original documents).
d) All the evidence must be offered at the beginning of the case.
e) Very formal: Official Translations; Deposition of witnesses through rogatory letters.
f) Justice tax/court fees: 3% of the amount of the claim plus interests to be paid at the beginning of the
case (There is no cap). If the judgment is in favour of the claimant, in general it is possible to obtain
from defendant the reimbursement of the amount paid as justice tax/court fees.
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3) Judicial Complaint: 5 years.
g) Civil & Commercial Federal Courts in Buenos Aires (11 First Instance Judges and 3 Chambers of the Appeal
Court, each administered by three judges: Double instance for the analysis of the proofs and the laws applied).
h) Some cases can reach the Supreme Court (Interpretation of Federal Rules), only concerning law matters
(Never facts or proofs).
The strategy is to be very careful to claim. Problem with respect to costs and fees of court expert witnesses
and opponent lawyers: If the court's final decision is against the claimant and the complaint is rejected, costs
and fees are generally paid by plaintiff.
4) Arbitration: Unusual in Argentina for transport matters.
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V.- THE NORMAL FEE ARRANGEMENTS THAT FIRMS WILL AGREE TO
FOR CARGO CASES IN ARGENTINA
a) Plaintiff lawyers: Contingency fees basis: No win no fee agreement. The usual percentage
is 20% of the recovery amount, plus disbursements. Our Legal Firm works according to the
different stages of the cases: Out of court recovery 10%. In Mediation 15%. In Court 20% of
the amount obtained from carrier.
However, to start a judicial action, a reasonable minimum fixed amount is usually agreed with
the client as advance, depending on the importance of the case, its complexity and the work
to be done to write a complaint and offer all the evidence.
b) Lawyers hired only to obtain evidences in Court or to arrest a vessel: An hourly rate or a
fixed amount for the whole work is often agreed.
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V.- THE NORMAL FEE ARRANGEMENTS THAT FIRMS WILL AGREE TO
FOR CARGO CASES IN ARGENTINA
c) Carrier's lawyers frequently act on a hourly rate fee basis, to be paid by the client. Standard
amount: USD 200 per hour.
d) Argentinean cargo recovery lawyers: Not solicitors - not barristers - not specialists in
particular subjects: "Multimodal lawyers": We handle the case from its origin until the
termination of the matter. (The market is small compared with other countries).
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VI.- UNUSUAL POSITIVE ASPECTS OF CARGO LAW THAT A CARGO
UNDERWRITER OR CARGO OWNER SHOULD BE AWARE OF IN DECIDING
WHETHER OR NOT TO PURSUE A CASE IN ARGENTINA
A) In General (For all means of carriage):
1) Higher limits of liability of carriers (Even no limit in many cases). Limit of liability is a defense
that must be invoked by carrier in his answer to the complaint. Limitation only refers to the
principal amount (Interests, costs and fees are not included). Moreover, gross negligence breaks
limitation in domestic air claims. (However consequential damages -loss of market, loss of future
business, loss of reputation- are not allowed under a standard carriage contract: It is only
possible to claim the sound market value of the goods).
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2) The principle of subrogation of the insurance company is easy and it is not necessary to attach the
insurance policy nor special wordings of subrogation forms (The origin of subrogation is simply the
payment: A standard subrogation receipt and release is enough – Insurer is in the same position of the
assured with regard time bar period and other legal matters).
3) Actual (Performing) Carrier and Contractual Carrier are jointly and severally liable with respect to cargo
owner.
4) Jurisdiction Clauses stated on B/L are not valid, when the place of delivery of the cargo is Argentina or
the event occurred in Argentinean waters (Collision, Salvage, General Average). Jurisdiction agreements
after the incidents are valid. (Cargo salvage contribution can be reduced if the case is considered in
Argentina instead other jurisdictions).
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5) Letters of claim issued by insurers, adjusters or lawyers are useful to suspend time bar period against carriers for six
months , even if the insurer has not paid the compensation to the assured. (Exception: Carriage by air).
6) Measure of damage to the goods: Sound market value upon arrival (Without V.A.T.). Direct method. Indirect method.
Consignee's additional claim against carrier is possible for the difference between the market value of the merchandises and
the amount compensated by the insurance company according to the insurable value of the cargo. In Argentina the sound
market value of the goods is almost ever higher than its insurable value.
7) First instance judgment is enforceable against carriers even pending the appeal proceedings.
8) Interest rate in Argentinean Pesos is about 25% per year. In United States Dollars interests are about 6 % per year.
Interests are to be paid from the date of the notice of claim or from the moment in which the debtor was in default.
9) There is no mandatory disclosure of documents (No pretrial discovery): Plaintiff can present only the documents he
prefers.
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B) In Particular:
10) Free in and out clauses are not valid to exonerate carriers by sea for damage or shortage of goods
during loading / discharging operations. (Only valid to say who pay the operation).
11) Preliminary court surveys are useful for salvage, general average, collision or other important cases
(Fall of containers carried on deck due to bad weather during sea passage: ¿Vessel seaworthy and / or
cargoworthy? ¿Due diligence? ¿Other options of the Master to avoid the storm? ¿What happened to other
vessels in the same position?). Carriers are obliged by the Judge to present documents (Example:
Registration of temperatures, ventilation, humidity in order to consider the fulfilment of shipper's
instructions). Useful to ascertain facts and obtain evidence (¿Where a H/H container was stolen?).
Complex cases (Explosion of dangerous cargoes / damages to Terminals or Vessels).
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B) In Particular:
12) Arrest of vessels are possible in two or three working days, holding a maritime lien in force on the vessel
(According to Brussels Convention of 1926 about Maritime Liens or the law of the vessel's flag about liens and
causes of extinguishment), the supporting documents translated, the amount of the justice tax in possession of the
lawyer to be paid at the beginning of the judicial presentation and the counter-guarantee / security at hand to be
presented in court as soon as the Judge rules in favour of claimant.
13) Cargo contribution in general average sometimes can be recoverable. Rule D of York-Antwerp Rules prevails
over the error in navigation defense.
14) Robbery is not considered an “Act of God” in carriage by road (Argentinean cargo insurance companies
request special conditions to cover the risk of robbery in favour of the owner of the goods: Armed surveillance or
alarm / anti theft satellite control system).
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VII.- UNUSUAL NEGATIVE ASPECTS OF CARGO LAW THAT A CARGO
1) Joint inspection of the damaged goods (No unilateral private surveys allowed).
2) Ordinary losses of weight or volume for liquid or dry bulk cargoes are accepted.
3) Power of attorney, justice tax/court fees and original documents are required.
4) Deposition of witnesses addressed outside Argentina: Rogatory Letters.
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5) Translations by certified experts (Free office translations are not valid, except agreed with the
opponent party).
6) Courts are not proactive. Precedents may change. Proceedings are very formal, mainly written.
7) Defendants carriers can raise an exception requesting the Judge a warranty to be presented by
plaintiff, if he has neither permanent address nor assets in Argentina, to assume the payment of the
legal costs, in case claimant looses the lawsuit (About 20% of the amount of the legal action).
Exception: Country which is a party or adhered to the Civil Procedure Convention, celebrated in
The Hague, in March 1954 or the Protocol for Cooperation and Jurisdictional Assistance in Civil,
Commercial, Labour and Administrative Matters between the State Parties of Mercosur.
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8) Expert witnesses fees in Court (Fixed by the Judge in the range of 3 to 8% of the claimed amount plus
interests: Even if plaintiff wins the case, he shall pay 50% of the expert's fees if defendant has no
solvency).
9) Fees of carrier's lawyers, if the case is rejected in Court (Fixed by the Judge in the range of 10 to 20% of
the amount of the claim plus interests in First Instance; 1/3 of such percentage in the Appeal
proceedings).
However, trial costs such as court fees, translator fees, disbursements of rogatory letters (Even
preliminary court survey costs) are generally recovered by the loosing party, if the final judgment is in
favour of the claimant and the court imposes such costs to defendant.
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B) In Particular:
10) It is necessary to present security for damages in case of arrest of vessels (About 30% of the claimed
amount plus interests). But there is no wrongful arrest cases because the order of arrest was issued by a
Judge.
11) Containers operated in conditions "House to House" or "FCL/FCL": Argentinean courts decided it is
necessary to prove the complete loading of the cargo into the container at origin (Testimony through
rogatory letters).
12) Container Liberty Clause: A clause stated on the reverse side of the bill of lading that allows the carrier
to transport containers on deck or under deck is a valid stipulation under Argentinean law (Argentinean
Supreme Court in re “La Buenos Aires Vs Gladiator”, August 1998).
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B) In Particular:
13) Usually Multimodal Transport Operators and Logistic Companies are considered as intermediaries,
agents or forwarders, unless they issue bills of lading: In such a case, they are carriers. But if there is a
special contract of services between the cargo owner and the MTO, the terms of such agreement must be
deeply analysed to consider the liability of MTO.
14) Carrier by road exemption of liability clause (Waive of rights of recourses against road carrier), usually
inserted in Argentinean cargo insurance policies. Besides, it is possible carrier by road or forwarders take
a property insurance coverage as co-assured and on behalf of the owner of the goods. So there is no
subrogation nor recovery in those cases, unless gross negligence can be proved.
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VIII.- ROTTERDAM RULES
Argentina did not sign nor ratify nor adhere to Rotterdam Rules. The applicable legal system for carriage
of goods in Argentina is very different compared with the RR. So, the application of RR in Argentina
seems to be unlikely nowadays.
IX- QUESTIONS - DOUBTS - MISCELLANY
Thanks!
Leonardo José Mainero (Partner)
MOHORADE, ISOLA, SERRAVALLE & MAINERO ADVOCATES.
Abogados

Mohorade – Isola – Serravalle – Mainero Abogados

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