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June 27 2018
Survey reports are an essential part of any claims handling process and an important factor in court proceedings.
The Code on Civil Procedure provides for numerous clauses of admissible means of evidence. However, party assertions are not listed among these means of evidence.
A recent Federal Supreme Court decision(1) hints at the possibility that survey reports, at least if prepared by one party alone, could be considered as mere party assertions, thus rendering them useless in court. The decision suggests that there is still much to be said on this issue.
A seller commissioned a forwarding agent to organise an international transport of 35 one-way pallets of chocolate. The transport was then commissioned and sub-commissioned to several carriers. The consignee refused to accept the goods on the grounds that they were damaged, poorly preserved and had partially disappeared. The cargo was therefore completely unusable.
Subsequently, the liability insurer of one of the carriers paid the insured, subrogated into the claims and sued against one of the sub-carriers.
The Canton of Aargau Commercial Court dismissed the action and the Federal Supreme Court dismissed the appeal filed against that decision.
The Convention on the Contract for the International Carriage of Goods by Road (CMR) applied to the matter at hand.
Before the Commercial Court, the plaintiff had asserted the existence of a total loss, which the defendant disputed. If a conclusive statement of facts is disputed, a burden of substantiation that goes beyond the mere burden of assertion takes hold. The plaintiff did not live up to this burden of substantiation, because in his final reply statement he had merely stated that the goods were "according to the survey report no longer marketable and no longer edible".
In the eyes of the Federal Supreme Court, the mere reference to a survey report is insufficient for a state of the art substantiation.
The court held that this fact alone was reason enough to dismiss the action.
The Federal Supreme Court's decision contains a fundamentally important aspect that is especially applicable to transport damage cases. In order to grasp its full meaning, the Commercial Court's decision(2) must also be taken into consideration.
The Commercial Court had described the independent survey report as a mere party assertion, without specifying why it so classified the report in this case. According to the Code on Civil Procedure, mere party assertions are not an admissible means of evidence. The general significance of survey reports would be severely diminished if this opinion of the Commercial Court were to be followed.
However, the Commercial Court's decision indicated that the defendant had argued that he had neither been given the opportunity to inspect the goods nor agreed to the surveyor's appraisal. Whether the court would have come to a different conclusion if it had been a contradictory survey must therefore remain open. Due to these circumstances, the question remains as to what legal and procedural effect a survey report would have if both parties had been involved – in one form or another – in the report's preparation.
Unfortunately, the Federal Supreme Court neither corrected nor overruled the Commercial Court's finding that a survey report is a mere party assertion.
A private expert opinion that is not commissioned by a court is clearly not an expert opinion within the meaning of Article 168(1)(d) of the Code on Civil Procedure. It is also undisputed that Article 168 contains a numerus clausus of admissible means of evidence and party assertions do not figure among this catalogue of admissible means of evidence.
While documents are mentioned in the catalogue, scholars disagree over whether a private expert opinion (such as a survey report) can be introduced into a procedure as a document within the meaning of Article 168(1)(d).
Although the Federal Supreme Court has so far rejected this and taken the view that private expert opinions cannot qualify as 'documents', the court has also stated that party assertions supported by survey reports are generally regarded as particularly substantiated. Further, even if they were qualified as mere party assertions, private expert opinions remain subject to the principle of free assessment of evidence, which would also give a court a certain possibility to consider private expert opinions in their decision making.
Given the crucial importance of survey reports in practice, Swiss courts will hopefully consider the significance of these indispensable elements of any claims handling process, since the classification as a 'mere party assertion' does not do justice to reality.
There would be steadier grounds for giving survey reports the status that they deserve if parties were adequately involved in their preparation (ie, if they were at least invited to the survey) or, even better, if they were drafted as joint surveys. If both parties agree to a survey report by a specific expert and if certain conditions are met, such agreement could even be viewed as an arbitral expert opinion within the meaning of Article 189 of the Code on Civil Procedure. The result of such an arbitral expert opinion would then be binding on the court. Whether it was the parties' intention to draw up an arbitral opinion must be determined on a case-by-case basis.
Certain legal frameworks (eg, the CMR) even contain special rules for joint assessments (see Article 30(2) of the CMR). Further, a court should consider when assessing the evidence if one party refuses to cooperate without good reason in establishing the extent of the damages. If a party is invited to examine the damage but refuses to participate, this should be taken into account.
The key takeaways from the case may be summarised as follows:
For further information on this topic please contact Stephan Erbe at ThomannFischer by telephone (+41 61 226 24 24) or email (firstname.lastname@example.org). The ThomannFischer website can be accessed at www.thomannfischer.ch.
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