Adv. Gill Nadel, Ohad Krief
Monetary disputes between clients (importers or exporters) and the various entities that form the logistic chain of transporting goods (such as forwarders or customs agents) are common, and frequently reach the courts.
A common claim in such disputes is that the sides agreed upon a predetermined price for a certain service, but the client was later charged with additional costs beyond the agreed price.
In such cases, the court is required to examine the content of the agreement between the sides, the cause of the excess costs, and whether they may be passed on to the client, even if not included in the original agreement.
In the following article we will review a case of an importer who was charged with excess costs due to undeclared goods and exchange rate differences. The court accepted the forwarder's argument that the excess cost was lawfully charged, and rejected the claim.
Case Facts and Detailed Arguments:
An importer placed an order for forwarding goods from China to Israel, and finalized the agreed upon price with the forwarding company during the placement of the order. The client was charged with excess costs of 250 USD, which the forwarding company claimed was paid to the Chinese Customs Authority due to undeclared goods found within the crate (used clothing). In addition, the importer claimed he was charged according to a high exchange rate. He therefore filed a small claim of 2,000 ILS against the forwarding company.
The forwarding company argued the claim should be rejected due the importer's concealment of the fact that the crate contained not only the goods declared by him, but his used clothing as well. According to the forwarding company, the importer purchased and inspected the goods in China, and was well aware of the contents of the crate. He then delivered the crate to the company for forwarding, declaring its content before the forwarding company, the Chinese Customs Authority and the Israeli Customs Authority. The forwarding company argued it may not open forwarded items- only the Chinese and Israeli Customs Authorities have that authority, in accordance with local law. Moreover, the forwarding company argued it has no obligation or authority to inspect a crate's content or question the authenticity of a client's customs declaration.
The forwarding company admitted it charged the client according to a high exchange rate that was not the representative exchange rate, but claimed it is the rate it was charged by the shipping company. The forwarding company added that shipping companies usually use a higher exchange rate, dubbed the "shipping exchange rate".
The Court's Ruling:
The court rejected the importer's claim that the forwarding company opened the crate, and not the Chinese Customs Authority, due to lack of evidence. Moreover, a customs clearance document from the Chinese Customs Authority was presented to the court, containing the amount of tax charged for a discrepancy between declared goods and actual contents of the crate.
The court's impression was that the importer could not explain why he did not originally declare the added goods, and thereby notify the forwarding company of their presence. The court rejected the importer's argument that he was unaware of the contents of the goods ordered from China, since they were ordered as a 'stock order' of plastic items, without the importer knowing exactly which specific products will reach Israel. The court ruled it improbable that the importer had no knowledge as to the content of the imported goods, especially since according to his own admission, the goods included his own used clothes as well.
The court accepted the forwarding company's version of being charged by the Chinese Customs Authority an extra sum of 250 USD. The court rejected the importer's argument that the forwarding company is obligated to open every crate it transports in order to determine if its contents match the customs declaration submitted by the crate's owner.
The court determined that charging the client according to the "shipping exchange rate" is acceptable, adding that the importer could have avoided the exchange difference by purchasing USD in a bank and using them to pay the forwarding company.
In light of the above, the court rejected the importer's claim, and charged him with legal costs totaling 700 ILS, to be paid to the forwarding company.
[TA (Rishon LeZion) 24992-01-15 Platzi V. Platinum Cargo (Eliezer Cohen) Ltd., presiding judge: Dalia Oestreicher, ruling from 6.1.16]
The above review is a summary. The information presented is for informative purposes only, and does not constitute legal advice.
For more information, please contact Adv. Gill Nadel, Chair of the Import, Export and Trade Law Practice
Email: Gill.Nadel@goldfarb.com Phone: 03-6089979.