Adv. Omer Wagner, Adv. Gill Nadel
In the course of business relations between an importer/ exporter and their customs agent, there is an ongoing financial negotiation which generally is not based on a written contract. Many times, these situations end up in court, which has to decide, in retrospect, what was agreed between the two sides and what should and shouldn’t have been billed. Recently a case on the matter was brought to the Haifa Magistrate Court.
Facts of the case and claims of the parties:
Mega Careline Company manufactures sanitary pads for adults, and among its activities is exporting and importing merchandise, for which it used the services of a forwarder and customs clearance services. Between Mega Careline and its customs agent arose a dispute which ended up in court.
The customs’ agent filed a lawsuit against Mega Careline and claimed that it owed him an approximate sum of 288,000 NIS for customs clearance services.
He further claimed that although there was no written contract between them, they did verbally agree that he would give Mega Careline a credit at the sum of 100,000 NIS. Without his consent, the agreed sum climbed higher and higher, and as a result he was forced to invoke the right of lien and detain two of the company’s container’s in the U.S. This consequently led to more expenses and eventually the containers were left behind.
In opposition Mega Careline filed a counter action and claimed that it was he who owed the company money, at a sum of 393,000 NIS which accumulated as follows - 193,000 NIS for the lost containers in the U.S, since, according to Mega Careline, the right of lien was used without justification, 100,000 NIS due to erroneous calculations, and 100,000 NIS for damaging its reputable name.
With regard to the erroneous calculations, Mega Careline claimed that when a customs’ agent charges his client for services given by a third party (shipping companies, etc.), he needs to show his client receipts, and in this case not all of the receipts were shown. Mega Careline Also claimed that the customs agent charged it for the containers demurrage, even though it had already paid and. In other cases Mega Careline claimed it paid for the demurrage of the container because the customs agent was negligent in his work, and also it paid in cases where it was not at all clear how the charges were calculated (there was no consistency in the amounts charged, concerning land transportation to the airport and the way back).
The verdict:
The court criticized both sides for not bothering to sign a written contract, therefore forcing the court to intervene and give its own interpretation to the agreement between them. The court noted that the customs agent based his claims regarding the customs clearance services debt, on his accounting books, and did not take the time to present different quotes on each deal , and noted that this went against him (during the trial).
In addition, the court ruled that the customs agent did not charge Mega Careline the exact amounts he was charged by various third parties, and that often the sums he charged were higher or not even charged in the first place from a third party.
Regarding this matter the customs agent claimed that he is not obliged to charge his client with the same amounts. This claim was rejected, and noted that only with a written contract such a claim can be proved, which was not the case here.
The court criticized the customs agent on using his right of lien concerning the containers in the U.S, and ruled that it had been proved that Mega Careline’s name was originally written on the bill of lading as the shipper and consignee, and only when the ships were already at sea with the containers, did the customs agent put his own name on (the bill of lading) instead of Mega Careline, and refused to allow the release of the containers. The court ruled that it had not been proven that Mega Careline agreed to let the customs agent exercise the right of lien as a result of the company’s debt; therefore the court ruled that the customs agent’s actions were not lawful.
Consequently, the customs agents’ action against Mega Careline was denied.
As for Mega Careline’s counter action, it was ruled that thanks to the expert opinion Mega Careline presented (to court) together with references, it successfully proved that the sums she was charged were unlawful. The customs agent however, did not present any expert opinion to contradict this, and this stood against him.
In the end, the court accepted most of Mega Careline’s claims against the customs agent and fined the customs agent with 292,000 NIS (the claim for reputation damages was rejected), in addition to a sum of 30,000 Nis for expenses and attorney fees.
(C.F. (civil file) Haifa Magistrate 1975/08 5375/07, judge Daniel Fish, verdict given on the 10th of January 2011, names of representatives were not mentioned)
Comments:
As mentioned in the verdict, it is highly recommended that both sides sign a written contract, so to save time at court.
Also, when arriving at court, (the plaintiffs) should not save on bringing expert witnesses, because as we can see from this verdict not bringing an expert witness, did not serve the customs agent well and led the court to accept the lawsuit against him.
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