Overview of Article 694 of the Civil Code of Georgia

In carriage of goods, it is often crucial for the parties not only to deliver the cargo safely and on time, but also to determine what happens in the event of damage. Article 694 of the Civil Code of Georgia provides the sender with an additional mechanism to protect their interests — the institution of declaring a special interest.

What Does Special Interest Mean?

According to the law, the sender may state in the consignment note that they have a special, heightened interest in a specific shipment. This declaration is not made free of charge, but against payment of an agreed surcharge — meaning an extra fee paid to the carrier to compensate for the increased risk.

This mechanism is relevant in three specific cases:

  • In case of loss of cargo;
  • In case of damage to cargo;
  • In case of exceeding the delivery time limit.

Why Is This Important in Practice?

In transport law, compensation for damages is usually limited to the value of the cargo or statutory limits (pursuant to Articles 692 and 693, preceding Article 694). However, the sender often has an economic interest that exceeds the nominal value of the cargo — for example, a lost business opportunity, the risk of breach of contract terms, or other indirect losses.

This precise issue is addressed by Paragraph 2 of Article 694: if the sender has declared a special interest in advance and paid the corresponding surcharge, they may claim additional damages — and this claim is independent of the compensation already provided under Articles 692 and 693. Importantly, the amount of compensation is limited to the amount specifically stated when declaring the interest.

Practical Advice

When entering into a contract with a carrier, if the cargo has special, higher-than-usual value or importance to the sender, it is advisable to:

  1. Reflect this circumstance in writing and explicitly in the consignment note;
  2. Clearly define the amount of surcharge that the sender pays for declaring this interest;
  3. Specifically state the monetary amount expressed in the interest, as this exact amount will serve as the basis for claiming additional compensation in the future.

Such foresight significantly simplifies the evidentiary process in the event of a dispute and ensures real, rather than merely formal, protection of the sender's interests.

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