## Facts

- A shipper (St.), acting through an agent, arranged shipment of 17 cases of cigars through a Mannheim freight forwarder (G.).
- Only 16 cases arrived; one case was missing.
- The shipper claimed damages of 5,166 marks, representing the value of the missing case.
- The forwarder asserted that all Mannheim freight forwarders had adopted a standard liability limitation capping recovery at 60 marks and argued the shipper was bound by that cap.
- The trial court rejected the limitation and awarded the shipper full damages.
- The appellate court affirmed, characterizing the industry-wide cap as a monopolistic, unilateral imposition that was immoral and contrary to good faith.
- The forwarder appealed to the Reichsgericht.

## Issues

1. Whether a freight forwarder may enforce a standard-form limitation of liability (60 marks) against a shipper seeking the full value of lost goods.
2. Whether a liability cap adopted uniformly by all local freight forwarders is invalid when imposed under conditions leaving the shipper no realistic alternative.
3. Whether such a limitation is void as contrary to good morals or good faith under general civil-law principles governing contractual autonomy and abusive terms.

## Decision

- The Reichsgericht addressed the enforceability of the liability cap in light of good morals and good faith constraints on contract terms.
- The court treated the uniform, industry-wide limitation as subject to special scrutiny because it was imposed unilaterally and functioned in a monopoly-like setting.
- On the facts presented, the limitation was not permitted to defeat the shipper’s claim for the full value of the missing goods.

## Legal Principles

- Contractual freedom does not protect standard terms that, in context, amount to an oppressive allocation of risk imposed by market dominance.
- An industry-wide, nonnegotiable liability limitation may be invalid if it is contrary to good morals or inconsistent with good faith.
- Formal assent to a clause may be insufficient where the counterparty lacks meaningful choice and the clause substantially undermines baseline responsibility for loss of goods.

## Conclusion

The case stands for the proposition that standard-form liability caps in freight forwarding, especially when adopted collectively and imposed under monopoly-like conditions, may be denied effect as contrary to good morals and good faith, allowing recovery of full loss despite the stated limitation.


G. v. St., RGZ 103, 82 (Reichsgericht 1921)