THE BOTTOM LINE
- Operational Control Trumps Ownership: A Dutch court has ruled that the company with operational control and contractual maintenance duties over private infrastructure (in this case, a rail line) is legally liable for its defects, even if they don’t own the land it’s built on.
- Strict Liability for Infrastructure Failure: Managers of private infrastructure face strict liability for damages caused by poor maintenance. This liability extends to the business interruption losses of third parties who are indirectly affected.
- Risk in Shared Logistics Hubs: The decision is a stark reminder that a failure in your privately managed infrastructure can create direct financial liability for disruptions to neighboring businesses, highlighting a key supply chain risk.
THE DETAILS
This dispute arose after a freight train derailed on a private rail siding used exclusively by P&O Ferries at its Rotterdam terminal. The accident blocked the main railway line, cutting off rail access to the adjacent terminal of European Bulk Services (EBS) for over a week. EBS sued P&O for nearly €70,000 in business interruption losses. The court’s decision hinged on one key question: who was legally responsible for the defective track? P&O argued it wasn’t liable because the Municipality of Rotterdam owned the land. The court, however, looked past formal ownership to the operational reality. Because P&O had exclusive use of the track, controlled access through its own gate, and had signed an agreement to take over all maintenance obligations, it was deemed the legal ‘manager’ of the infrastructure.
The cause of the derailment was central to the case. EBS presented a technical report, conducted just one day after the incident, which found the track in a severe state of disrepair. Evidence showed wooden sleepers were rotten and that bolts were so loose they could be removed by hand. P&O countered that the derailment could have been caused by the train operator using wagons that were too long for the track’s tight curve. The court dismissed this defense as speculative, giving far more weight to the direct evidence of neglect. Critically, P&O admitted it had performed no significant maintenance or inspections on the track in the four years since contractually assuming responsibility for it. This admission sealed the conclusion that the track was defective and that this defect caused the accident.
The judgment confirms a critical principle for operators in dense industrial and logistics areas. The court found that even if the train operator shared some of the blame, P&O would still be fully liable to the injured third party, EBS, under the Dutch rules of joint and several liability. As the ‘manager’, P&O was responsible for ensuring the track was safe for its intended use and could have set rules for the types of wagons permitted. While the court has now issued an interim judgment establishing P&O’s liability, it has asked EBS to provide a more detailed substantiation of its financial damages before making a final award. The case will now proceed to determine the final compensation amount.
SOURCE
Source: Rechtbank Rotterdam
