Panalpina Annual Report 2006

Consolidated and Annual Financial Statements 2006
106 Panalpina Annual Report 2006
Pledged assets
The value of pledged assets amounts to CHF 13,000 (prior year CHF 12,000).
Pending legal claims
In addition to the matters discussed under insurance risk, from time to time the Group is involved in legal proceedings in the
ordinary course of its business. Other than as noted below, the Group is not a party to any legal, administrative or arbitration
proceedings which could significantly harm the Group’s business, financial condition and results of operations taken as a
whole, and it does not know of any such proceedings which may currently be contemplated by governmental or third parties.
Pantainer Ltd., the Group’s NVOCC (Non-Vessel Operating Common Carrier), is facing lawsuits concerning liability claims in
an unspecified amount in connection with two incidents in which it is alleged that fires occurred, allegedly due to containers
shipped under Pantainer bills of lading, containing chemicals that were not declared as hazardous cargo. In the first case,
the container ship was seriously damaged and the extent of damage to other cargo on board the vessel is understood to
be significant. Legal proceedings in connection with this aforementioned case have been initiated against Pantainer Ltd.
The pending lawsuits in London and Rotterdam contain actions for damages in an unspecified amount and for a declaratory
judgment against Pantainer Ltd. In addition, a formal payment demand in an amount of approximately USD 130 million has
been filed against Pantainer Ltd. in Basel to interrupt the statute of limitations.
Part of this unquantified claim against Pantainer is for an indemnity in regard to cargo claims brought against other parties
involved in the carriage of the containers. The amount of these claims is limited to approximately USD 11 million, in
accordance with a limitation decree obtained by one of those parties. This is likely to reduce the overall amount of the claim
in regard to loss of or damage to cargo, but it is not yet clear how substantial the reduction may be. The limit does not apply
in relation to damage to the vessel.
In the second case, as a consequence of a fire – which was able to be extinguished shortly after it broke out – the vessel has
declared general average. The operation of the vessel was deliberately stopped for safety reasons, the fire was extinguished
and the operation of the vessel continued. Claimants may seek compensation of general average contributions and damage /
loss of cargo respectively potential damages to the vessel. Formal legal proceedings have been launched in Tokyo against
the shipper, which in turn has opened third party proceedings against Pantainer Ltd. and other companies of the Group. The
value in dispute amounts to approximately CHF 7 million.
In both cases, Pantainer Ltd. has received information from the shippers of the cargo that the chemicals were not dangerous.
Furthermore, Pantainer Ltd. has filed/prepared recovery actions against certain other parties involved.
These cases will raise complex issues as to the exact chemical composition of the cargo, its characteristics and the likely
cause of the fires. To date, the proceedings have not progressed far enough for Pantainer to reach a definitive view of
its potential liability exposure, the insurance coverage actually available or the realistic prospects of a recovery from other
parties. However, in the first case, evidence has recently emerged which indicates that the fire may have been caused by
the fault of the vessel and / or the crew. This evidence is currently being evaluated and tested.
In an initial reaction in June 2005, the insurance company has denied coverage for the first case, but accepted coverage for
the second case. To date, no specific provisions have been made.
Subsequent events
Since the balance sheet date, no events have become known for which a disclosure is required.