This appeal involved a dispute between two parties in a freight forwarding arrangement which involved land carriage of goods by lorry from Porto to Alphen aan den Rijn in the Netherlands and by ship from Lomé, Togo, to Leixões, Portugal, on various dates between September 2002 and July 2003, in terms of which the freight forwarder was responsible for handling the cargo, dealing with the necessary formalities, issuing the relevant documents, liquidating expenditure involved in the movement of goods, ordering and paying insurance and customs clearance, and paying duties and customs charges. The cargo owner sought compensation for lost cargo on the Togo voyage.

The freight forwarder invoked limitation of action, pursuant to art 16 of Decree Law No 255/99 of 7 July (which covers freight forwarding), forfeiture of the cargo owner's right of action based on art 3.6 of the Convention for the Unification of Certain Rules relating to Bills of Lading, signed in Brussels on 25 August 1924 (the Hague Rules) (Decree Law No 37748 of 1 February 1950) and limitation of liability arising from art 4.5 of the Hague Rules, which would result in the value of any compensation awarded not exceeding EUR 498.79.

The lower court and appellate court held in favour of the cargo owner, awarding different amounts as compensation on differing grounds. The freight forwarder appealed in cassation to the Supreme Court of Justice.

Held: Appeal in cassation granted and judgment under appeal set aside.

It is clear that the parties have entered into a contract whereby the appellant, licensed as a forwarding agent, has undertaken to provide the respondent with 'logistical services relating to the movement of goods or goods, including the conclusion, on its own behalf and for the other party, of transport contracts' (José A Engrácia Antunes, Commercial Contract Law, Coimbra, 2009, 731); that is, to provide it with services of freight forwarding activity - art 1 of Decree Law No 255/99.​ It is certain that, if the legal regime governing freight forwarding activity is applicable, the right to compensation is prescribed under the terms of art 16 of Decree Law No 255/99 - the service was concluded in May 2003 and in the following 10 months, no action was taken by the respondent to interrupt the limitation period, as required by art 323(1) of the Civil Code.

But it is also certain that the damage relied on by the respondent cargo owner in support of its claim for damages is based on partial non-compliance or, more accurately, on the faulty performance of the transport service directly by the actual carrier rather than by the appellant. According to the provisions of art 15(1) of Decree Law No 255/99, the appellant is responsible for 'the obligations undertaken by third parties with whom they have contracted, without prejudice to a right of recourse'. The rules of the contract of carriage by sea must therefore apply (see, for example, the judgments of the Supreme Court of Justice of 6 May 2003, case No 03B4302, or 18 December 2008, case No 08B3832, both available at www.dgsi.pt, or António Menezes Cordeiro, Introduction to Transport Law, ROA, Vol I, January 2008, at http://www.oa.pt).

Between the expiry of a year's action for damages 'from the delivery of the goods or from the date on which they should be delivered', as set out in art 3.6 of the Hague Rules, and the 'two-year period from the date on which the injured party became aware of his right' provided for in art 27(2) of Decree Law No 352/86 of 21 October (regulating the contract of carriage of goods by sea), the judgment under appeal chose the second; and counting from 30 June 2003 decided that the respondent's claim for compensation was timely.

However, the Brussels Convention, which was published in the Government Gazette of 2 June 1932 (Letter of Accession of 5 December 1931) and whose articles 1-8 were introduced into national law by Decree Law No 37748, 1 February 1950 prevails over Decree Law No 352/86, as is expressly stated in the relevant art 2 and the judgment under appeal. The time limit set by the Brussels Convention had already elapsed when the respondent challenged and objected, exercising its right to compensation. As expressly stated in the judgment of the Supreme Court of 18 September 2007, www.dgsi.pt, proc No 07A2649: 'It is beyond question that Portugal acceded in 1932 to the Brussels Convention of 25 August 1924 on the carriage of goods by sea under bills of lading, and since the entry into force of DL 37.748 of February 1, 1950, the provisions of arts. 1 to 8 are now applicable to all bills of lading issued in Portuguese territory, whatever the nationality of the contractors, the legal relationship set out in the dispute must first be governed by the rules contained in the said Convention, and only then, in the alternative, by national law (…). According to art. 3(6) of the aforementioned Convention, legal proceedings must be brought within one year of the delivery of the goods, under penalty of forfeiture of the right of action.' The judgment of 14 April 2011, www.dgsi.pt, case no 283/09.0YFLSB.S1 has also ruled in a similar vein.