TNT Global SPA & Anor v Denfleet International Ltd & Anor

This is an appeal from the decision of His Honour Judge Kershaw QC dated 5^th July 2006. The appellants were, through a sub-contractor, carrying the respondents cargo of pharmaceuticals on a lorry. That lorry crashed on the Autostrada del Sole near Milan and the cargo was lost by fire. The crash occurred because the driver fell asleep at the wheel. The appeal raises the important question whether the judge was entitled to hold, in the absence of any evidence other than that the driver had fallen asleep at the wheel, that the driver was guilty of wilful misconduct.

It is unnecessary to distinguish between the two claimant (respondent) companies or between the two defendant (appellant) companies. The claimants I will simply call “Denfleet” and the defendants “TNT”. TNT agreed to carry the goods of Denfleet from Naples to Elstree and subcontracted the Rome-Milan leg of the journey to a company called Transflora SRL. Mr Vito Caselli was the driver of the lorry. He was a professional driver aged 46. He used the Autostrada del Sol which runs, via Florence, where, in the normal course of events, goods would have been taken off and put onto his trailer to get to Milan. At about 8.50 on the morning of 1^st August 2002 the lorry was involved in an accident near Lodi, about twenty miles south of Milan. According to the police report the north-bound carriageway at that point has three lanes and a hard shoulder; the weather was calm, visibility was good and the traffic was heavy. The lorry hit the right rear corner of a semi-trailer, which was being driven at 85 km/hr in the slow lane of the motorway and then veered off the carriageway to the right, knocked down a barrier and burst into flames. The claimants’ goods, a cargo of pharmaceuticals, were destroyed in the fire. Neither driver was injured. According to a police report Mr Caselli said he was driving along the motorway in the direction of Bologna to Milan, using the slow lane, when:

“As a result of falling asleep at the wheel I hit a heavy vehicle that was in front of me, despite an attempt in extremis to veer to the right, shortly after I ended up on the slope, where my heavy vehicle caught fire.”

It is not in issue, I believe, that what the driver there describes is a falling asleep at the wheel, a waking up just prior to hitting the vehicle in front, resulting in an attempt to veer to the right. However, the attempt to veer to the right failed to prevent the lorry driven by Mr Caselli from hitting the lorry in front, that lorry in front travelling at 85 km/hr.

It seems that both sides contemplated the possibility of joining Transflora SRL in the action but that entity was not sued by Denfleet and not joined as a party by TNT. Neither party called Mr Caselli to give evidence at the trial and the only evidence from him was the brief statement set out above.

The vehicle’s tachograph was destroyed in the fire and thus it was not available to provide evidence as to the length of time which Mr Caselli had been driving on that morning. Furthermore it seems that there were no records available from TNT or Transflora relating to the time at which Mr Caselli had left Rome. Prior to the trial Denfleet sought to obtain disclosure of certain categories of documents. The outcome was that, despite TNT at one stage suggesting that an internal investigation into the accident had been commenced, and remained ongoing, no reports or correspondence relating to the investigation were ever disclosed and no proper answer was ever provided as to what had become of them. It is right to say that so far as the allegation of wilful misconduct is concerned it was not made until two and a half years after the incident. In the result, records maintained at the depot, which would have shown the departure time of the lorry, had been routinely destroyed. Thus it was that there was no evidence as to how long the driver had been driving, when he last took a rest, or when he left Rome or Florence, and the only evidence was his statement that he had fallen asleep at the wheel.

The value of the claimants’ goods was agreed at £300,000. However, under the Convention on the Contract for the International Carriage of Goods by Road (the CMR), Denfleet would be entitled only to compensation calculated by reference to the weight of the goods and to the value of SDRs (about £1,000), unless the damage was caused by wilful misconduct (Article 29). Furthermore, the claim in this case was not started by the issue of a claim form within one year of the accident. Only the first defendant had extended time and it was not party to the contract of carriage. The second defendant, which was party to the contract, had not given an extension. Under Article 32 of the CMR, the period of limitation is ordinarily one year, but “nevertheless, in a case of wilful misconduct or such default as in accordance with the law of the court or tribunal seized of the case is considered as equivalent to wilful misconduct, the period of limitation shall be three years.”

Thus, unless Denfleet could establish loss due to “wilful misconduct”, their claim would be limited to £1,000 and would in any event be time barred.

There have, over the years, been many attempts to define wilful misconduct. In National Semiconductors (UK) Ltd v UPS Ltd [1996] 2 LL Rep 212 at 214, Longmore J, as he then was, having cited various authorities said:-

“If I summarise the principle in my own words, it would be to say that for wilful misconduct to be proved there must be either (1) an intention to do something which the actor knows to be wrong or (2) a reckless act in the sense that the actor is aware that loss may result from his act and yet does not care whether loss will result or not or, to use Mr Justice Barry’s words in Horobin’s case, “he took a risk which he knew he ought not to take” [1952] 2 Lloyd’s Rep. at p.460

In Forder v Great Western Railway Co [1905] 2 KB 532 at 535-6, Lord Alverstone CJ adopted the following definition given by Johnson J in Graham v Belfast and Northern Counties Railway Co [1901] 2 IE 13:-

“Wilful misconduct . . . means misconduct to which the will is party as contradistinguished from accident, and is far beyond any negligence, even gross or culpable negligence, and involves that a person wilfully misconducts himself, who knows and appreciates that it is wrong conduct in his part in the existing circumstances to do, or to fail or to omit to do (as the case may be), a particular thing, and yet intentionally does or fails or omits to do it, or persists in the act, failure or omission, regardless of the consequences.”

Lord Alverstone continued:-

“The addition which I would suggest is “or acts with reckless carelessness, not caring what the results of his carelessness may be.”

Beldam LJ, in Lacey’s Footwear v Bowler International [1997] 2 LL Rep 369 at 374 put it this way:-

“Further a person could be said to act with reckless carelessness towards goods in his care if, aware of the risk that they may be lost or damaged, he nevertheless deliberately goes ahead and takes the risk, when it is unreasonable in all the circumstances for him to do so.”

As regards the burden and standard of proof, there was no issue between the parties and the judge correctly directed himself by reference to a passage from Brooke LJ’s judgment in Lacey’s Footwear at p 381 where he said that the trial judge:-

“should also have directed himself that since a charge of wilful misconduct was a serious charge to make, the evidence ought to have satisfied the degree of probability appropriate to the seriousness of the charge before it was appropriate to find it proved (Hornalv Neuberger Products Ltd [1957] 1 QB 247 and Khawaja v Secretary of State for the Home Department [1984] AC per Lord Scarman at pages 113-114).”

The judge also quoted a useful passage from the judgment of Andrew Smith J in Datec Electronic Holdings Ltd v UPS Ltd [2005] 1 LR 470 at 481 where he said:-

“I should add that I was properly reminded by counsel that the principle set out in such cases and as in Re H and others (Minors) Sexual Abuse: Standard of Proof [1996] AC 563 where Lord Nichols observed that “built into the preponderance of probability standard is a generous degree of flexibility in respect of the seriousness of the allegation” (at p 596f), however Lord Nichols explained that this simply means that the inherent probability or improbability is itself to be taken into account when weighing the probabilities in deciding whether, on balance, the event occurred. Although in this case the allegation is one of theft from an employer I do not regard this possibility as so improbable that there is a particularly heavy burden upon the claimants to prove their case. I have simply concluded that there is not proper evidence to support the claimants’ allegation . . .”

The judge’s finding

“16.

In my judgment I am entitled to, and in fairness to the claimant I should, assume in the absence of evidence to the contrary that when he left Rome on 31 July or early on 1 August 2002 Sr Caselli knew: that a vehicle becomes a source of serious risk to a driver, to his vehicle and any passengers or goods which he may be carrying and to other road users and their vehicles if he goes to sleep while driving or if his ability to concentrate is impaired, whether because he is sleepy or because concentration is affected by long hours at the wheel; that the risk is greater if the vehicle is moving at motorway speeds than at manoeuvring speed; that Regulations restricting drivers’ hours exist for the purpose of reducing the risks caused by drivers whose ability to remain awake and to concentrate is impaired; and that for the purpose of enforcing the Regulations commercial vehicles are fitted with tachographs which provide a permanent record of the periods for which a vehicle is driven.

17.

The critical question in this case is whether Sr Caselli knew, in time to stop driving, that he was sleepy. If he did, then in my judgment he was guilty of wilful misconduct in continuing to drive, and at a speed which must have exceeded 85 km/hr, instead of pulling off the carriageway either at a slip-road if there was one or onto the hard shoulder. That is the factual point which would distinguish wilful misconduct from negligence, whether or not negligence which would attract the epithet ‘gross’. I must, in the words of Andrew Smith J, take into account the inherent probability or improbability when weighing the probabilities and deciding whether, on balance, he deliberately continued to drive when he knew that he was becoming sleepy. The important feature of this case is that the inherent probability is the only thing I can take into account. There is no direct evidence except, for what little it is worth, the fact that Sr Caselli did not have much further to go. He was not called as a witness and no statement by him was in evidence under the Civil Evidence Act. There is no evidence, in either of those forms, from any other driver who saw Sr Caselli’s vehicle in the minutes or seconds before the collision. Counsel for the claimant submitted that the inherent probability is that he would have knowingly reached a stage when a driver either stops or continues but does something to keep himself awake such as opening a window, putting a radio or music player on at loud volume or drinking a cola drink.

18.

I have reached the conclusion that probably Sr Caselli did not pass directly from alertness to sleep but was aware that he was sleepy and made a conscious and deliberate decision to continue his journey. That was reckless in the sense of that word as used by Longmore J, which I have quoted.”

There are as I see it three matters to be addressed. What is the relevant state of mind that has to be established if a driver has fallen asleep at the wheel and is to be found to have been guilty of “wilful misconduct”? Second, did the judge make a finding that this was Mr Caselli’s state of mind? If so, was there evidence on which he could make that finding?

The judge was unassisted by expert evidence and had simply to make findings by reference to his own experience and the presumptions on which cases in a different context have been decided. He was of the view that a driver who fell asleep at the wheel would, prior to falling asleep, have appreciated that he was sleepy. So far as the judge was concerned it was the knowledge that he was sleepy and his deliberate decision to continue to drive when he knew he was sleepy that constituted “wilful misconduct”.

I am unable to accept that mere knowledge on the part of a driver that he was sleepy and a decision to continue to drive would constitute wilful misconduct. As regards misconduct per se, I find it difficult to think that if all that had happened was that a driver had felt sleepy and admitted such when he walked into his depot, that his employer would have been entitled to dismiss him for misconduct let alone wilful misconduct. If, of course, he confessed to driving contrary to the regulations as to time and rest periods, and admitted that he appreciated that fact, the situation would be entirely different.

I would also accept that if a driver crashed his lorry after falling asleep, and it could be shown that he had been made aware that he could not defeat his feeling of sleepiness because he had already hit the side of the road or driven in a way that indicated that he had nodded off, that would be different again.

In my view, although it is fair to say that people who fall asleep at the wheel will have had warning signs before they fall asleep and, although it is grossly negligent to ignore those warning signs, that negligence is in failing to appreciate that a driver cannot, whatever he may believe, defeat the sleepiness. The state of mind of the driver who is sleepy and continues to drive is likely to be that he believes he will beat the sleep and be safe. A professional lorry driver is in a different position from an ordinary driver particularly because limits are set by regulations. He knows that the limits are set to avoid the risk of falling asleep, and if he deliberately ignores those limits he is guilty of wilful misconduct (see Jones v Martin Bencher [1986] 1 LLs Rep 54). If something has demonstrated to the driver that the driver cannot beat the sleepiness, such as hitting the side of the road, again because he becomes aware that he cannot beat sleepiness, he would become guilty of misconduct, indeed wilful misconduct.

I now turn to the judge’s findings. He did not find that it was to be inferred that the driver had exceeded the permitted hours. On the evidence it was not open for him to do so and I do not see any suggestion, either in the written submissions before the judge from the claimants or in the respondents’ skeleton in the court of appeal, that this was an inference the judge was entitled to draw.

All the judge has found is that the driver knew he was sleepy, and he has concluded from that finding alone, that because “he continued to drive when he knew he was becoming sleepy” the driver was guilty of wilful misconduct. That, as it seems to me, is not a finding sufficient to support a conclusion that the driver was guilty of “wilful misconduct”.

Would it have been open to the judge to go further than he did? If there had been some evidence to support the view that the driver might have been driving beyond the permitted time limits, or some evidence of erratic driving, then if the carriers chose not to call the driver who is alive and well or even put a statement in from him, it would have been open to the court to draw adverse inferences. But in this case the respondents do not assert any such factors. Furthermore the driver was not, it seems, even prosecuted by the Italian authorities. In my view the judge went as far as it was legitimate on the evidence for him to go but, as I have indicated, for my part his finding of fact as to the state of mind of the driver does not go far enough to support a conclusion of wilful misconduct.

I would accordingly allow the appeal.

I agree that the appeal should be allowed for the reasons given in both judgments.

I agree that the appeal should be allowed. I will set out my reasons shortly in my own words because the case raises an important question, as Waller LJ has said, and because we are differing from Judge Kershaw QC’s clearly reasoned judgment.

To establish wilful misconduct within the meaning of the CMR, it is not enough to show that the carrier was at fault in failing to take proper care of the goods and that the carrier’s conduct was the product of a conscious decision. It has to be shown that the actor knew that his conduct was wrong or was recklessly indifferent whether it was right or wrong; and, as part of that requirement, he must have appreciated that his conduct created or might create additional risk to the goods. The authorities have been referred to by Waller LJ.

The difficulty facing the judge was the paucity of evidence, to which Waller LJ has referred. It seems surprising that there was no evidence about how long the driver had been driving, but that was the state of affairs. The judge had the driver’s bare admission that he had fallen asleep at the wheel.

The judge was entitled to conclude as a matter of common sense that the driver was unlikely to have passed from alertness to sleep without any warning sign. For a professional driver transporting a heavy load on a motorway to fall asleep at the wheel raises at least a strong inference of serious misjudgement of his fitness to drive. But was the bare fact that he fell asleep sufficient to justify a finding of wilful misconduct? The judge stated succinctly his reasons for giving the answer “yes” in para 18 of his judgment (set out by Waller LJ in para 13 above).

Mr Nolan submitted on behalf of the carrier that the judge ought to have asked himself the question whether there had been a time before the crash when the driver appreciated that he was becoming sufficiently sleepy that he was in danger of falling asleep, and that it was therefore wrong for him to keep on driving. He submitted that the evidence was insufficient to justify giving a “yes” answer to that question.

Ms Cunningham submitted on behalf of the owner of the goods that the judge was entitled to infer, and implicitly found, that the driver knew that he was tired and thus had become a source of serious risk to himself, his cargo and other road users. She submitted that the distinction which the carrier sought to draw between being tired and being so tired as to be in danger of crashing did not arise in the context of responsible driving. Once a driver is tired, his ability to drive is impaired and he becomes a source of risk to himself and others. Any professional lorry driver must be well aware of this. Accordingly, the fact that he fell asleep at the wheel was enough to raise an inference of wilful misconduct in the absence of any evidence to suggest that, unusually, the driver was unaware of feeling tired before he actually fell asleep.

Fault or misconduct in the case of a motorist may or may not involve matters of degree. If a traffic light is red, it does not require any element of judgement on the part of the driver to know whether he should stop. But driver impairment may be a matter of degree. A driver’s ability may be reduced for many reasons. Tiredness is one of them. A motorist may feel some degree of tiredness, possibly transient, but not believe that it is sufficient to impair his ability to drive with proper care. If so, that may involve negligent misjudgement, but not wilful misconduct. On the other hand, a motorist may be aware that his ability to drive is significantly impaired.

If a motorist drives beyond the permitted number of hours (as in Jones v Martin Bencher [1986] 1 Lloyd’s Rep 54), that in itself involves a deliberate breach of safety regulations. But there was no evidence of that in this case. In this case, the key question to my mind is whether the lorry driver must have known that his ability to drive was significantly impaired, or, to put it more fully, whether he knew that he ought to stop because there was a risk of his failing to drive with proper care on account of tiredness.

My conclusion is that the bare fact of the driver’s admission that he fell asleep is insufficient to justify that conclusion. It is one thing to find that the driver was unlikely to have fallen asleep without some prior warning sign, and that he must have been aware as a general proposition that tiredness can lead to accidents. It is another matter to find that the warning sign must have been such as to make him realise that he was not properly fit to drive, and that his failure to stop was the result of a deliberate or reckless disregard of his unfitness to drive, rather than a misjudgement of his fitness to drive.