Li Lian International Ltd and Others v. Herport Hong Kong Ltd and Another

HCAJ 160/2015

[2019] HKCFI 826

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO 160 OF 2015

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J U D G M E N T

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Introduction

1.This is the application of the Third Party (“NYK”) by summons (“Summons”)

(1)   to discharge the Order dated 11 September 2017 (“Order”) by Master S Lo giving leave to the 1^st Defendant (“Herport”) to issue a Third Party Notice (“3P Notice”) against NYK and serve it on NYK out of the jurisdiction in Tokyo, Japan;

(2)   to set aside service of the 3P Notice on NYK;

(3)   for a declaration that the court has no jurisdiction over NYK and/or should not exercise any jurisdiction that it may have over NYK;

(4)   for a stay of the Third Party Proceedings against NYK.

2.As set out in the Summons and further refined in Mr Alder’s skeleton argument, the application is based on 3 grounds:

(1)   an exclusive jurisdiction clause in the bill of lading dated 5 June 2013 issued by NYK to Herport as shipper (“NYK B/L”); (“Ground 1”)

(2)   lis alibi pendens on account of the existence of limitation proceedings in Japan; (“Ground 2”) and

(3)   material non‑disclosure by Herport when it applied ex parte to Master S Lo for the Order (“Ground 3”).

Background

3.The present proceedings arose out of the same unfortunate incident which prompted HCAJ 114/2014[1] involving the total loss of a container vessel “MOL Comfort” (“Vessel”) in the Indian Ocean in June 2013.  The Vessel fractured amidship, split into two halves, drifted for days and eventually sank together with all the cargo laden on her (“Casualty”).

4.All the Plaintiffs in this case, as in HCAJ 114/2014, are cargo interests or insurers.  The 1^st to 4^th Plaintiffs claim against Herport for loss of their cargo shipped under 2 bills of lading dated 5 June 2013 issued by Herport (“Herport B/Ls”).  Herport was not the actual carrier of the cargo — it is a non‑vessel operating common carrier (“NVOCC”) and had sub‑contracted the carriage of the cargo to NYK, as evidenced by the NYK B/L.  In the 3P Notice and Third Party Statement of Claim, Herport claims against NYK for an indemnity of the 1^st to 4^th Plaintiffs’ claims and/or contribution in respect of Herport’s liability to them.

5.Both the Herport B/Ls and the NYK B/L were issued in Hong Kong for the cargo to be shipped from Hong Kong to Le Havre, France.  The Herport B/Ls expressly provide for Hong Kong laws to be the governing law and for Hong Kong Courts to have exclusive jurisdiction.  On the other hand, importantly for the present purpose, the NYK B/L expressly provides for Japanese laws to be the governing law and for the Tokyo District Court to have exclusive jurisdiction.  Having said that, it is accepted by Mr Chain and Mr Alder that what is commonly known as the Hague‑Visby Rules (“HVR”) apply to the NYK B/L and, in any event, both Hong Kong and Japan are HVR territories and the HVR would apply to legal proceedings in either jurisdiction.

6.Presently, there are 2 on‑going legal proceedings in Tokyo in relation to the Casualty:

(1)   a limitation action commenced by Mitsui OSK Lines Ltd (“Mitsui”) before the Tokyo District Court (“Limitation Action”); and

(2)   an action commenced by inter alia Mitsui and Ural Container Carriers SA (“Ural”) against Mitsubishi Heavy Industries Ltd (“MHI”) before another division of the Tokyo District Court (“MHI Action”).

7.At the material time, Ural was the owner of the Vessel, Mitsui was the time charterer, NYK was a slot charterer while MHI was the one who built the Vessel.

8.A brief description of the Limitation Action and the MHI Action, as well as their progress, was set out in AIG Europe Ltd v Fast‑Link Express Ltd [2017] 3 HKLRD 112 at [14]‑[21] and shall not be repeated here.  At the risk of stating the obvious, the description was valid as at the date of the judgment ie 10 January 2017 and was based on the evidence filed in that action.

9.In the present case, a fairly detailed description of the Limitation Action and the MHI Action can be found in paragraphs 17 to 37 of the 1^st Affirmation of Lee Ming Tak dated 29 March 2016 filed on behalf of the 1^st and 2^nd Defendants in support of their application to stay the present proceedings against them.

Deliberation

10.Clause 3 of the NYK B/L provides as follows:

“ 3. (Governing Law and Jurisdiction) (a) The contract evidenced by or contained in this Bill of Lading shall be governed and construed by Japanese law except as may be provided for herein, and (b) notwithstanding anything else contained in this Bill of Lading or in any other contract, any and all actions against the Carrier in respect of the Goods or arising out of the Carriage shall be brought before the Tokyo District Court in Japan to the exclusion of the jurisdiction of any other courts whilst any such actions against the Merchant may be brought before the said Court or any other competent court at the Carrier’s option ...” (emphasis added)

11.On the face of it, Clause 3(b) is a jurisdictional agreement, it is in favour of the Tokyo District Court and is exclusive in nature.

12.It has been said that the practice of the Court is to give exclusive jurisdiction clauses, as between the parties to them, a “generous” interpretation: Donohue v Armco Inc [2001] UKHL 64 at [14].  Giving Clause 3(b) a generous interpretation, and given that Herport’s claim against NYK, as pleaded in the Third Party Statement of Claim, is based on the NYK B/L, it seems reasonably clear to this court that the claim does fall within the description of “any and all actions against the Carrier in respect of the Goods or arising out of the Carriage”.  It naturally follows that Herport is contractually bound by Clause 3(b) to bring its claim against NYK for an indemnity, contribution or otherwise in the Tokyo District Court.

13.The legal principles are not seriously in dispute. 

14.In Donohue v Armco Inc [2001] UKHL 64 at [24] and [25], Lord Bingham set out the principles in these terms:

“[24] If contracting parties agree to give a particular court exclusive jurisdiction to rule on claims between those parties, and a claim falling within the scope of the agreement is made in proceedings in a forum other than that which the parties have agreed, the English court will ordinarily exercise its discretion (whether by granting a stay of proceedings in England, or by restraining the prosecution of proceedings in the non‑contractual forum abroad, or by such other procedural order as is appropriate in the circumstances) to secure compliance with the contractual bargain, unless the party suing in the non‑contractual forum (the burden being on him) can show strong reasons for suing in that forum.[2] I use the word “ordinarily” to recognise that where an exercise of discretion is called for there can be no absolute or inflexible rule governing that exercise, and also that a party may lose his claim to equitable relief by dilatoriness or other unconscionable conduct. But the general rule is clear: where parties have bound themselves by an exclusive jurisdiction clause effect should ordinarily be given to that obligation in the absence of strong reasons for departing from it. Whether a party can show strong reasons, sufficient to displace the other party’s prima facie entitlement to enforce the contractual bargain, will depend on all the facts and circumstances of the particular case. In the course of his judgment in The Eleftheria [1970] P 94, 99‑100, Brandon J helpfully listed some of the matters which might properly be regarded by the court when exercising its discretion, and his judgment has been repeatedly cited and applied. Brandon J did not intend his list to be comprehensive, but mentioned a number of matters, including the law governing the contract, which may in some cases be material…

[25] Where the dispute is between two contracting parties, A and B, and A sues B in a non-contractual forum, and A’s claims fall within the scope of the exclusive jurisdiction clause in their contract, and the interests of other parties are not involved, effect will in all probability be given to the clause.” (emphasis added)

15.In paragraphs 13 to 16 of his skeleton submissions, Mr Chain, for Herport, put forward, with respect, a convoluted line of arguments based on (i) his interpretation of Clause 2 (Clause Paramount) and Clause 3 of the NYK B/L and the interaction between the two and (ii) S‑Net Freight (HK) Limited v Namsung Shipping Limited unrep, HCCL 13 of 2010, 3 August 2011, Reyes J.  At paragraph 16, the ultimate conclusion Mr Chain arrived at from that line of arguments is that Clause 3(b) is not a valid exclusive jurisdiction clause in favour of the Tokyo District Court.  Hence, the burden falls on NYK to show, as in any stay application based on forum non conveniens, that there is a more appropriate forum than Hong Kong to determine Herport’s claim against it.

16.Instead of trying to summarise that line of arguments, this court shall set out Mr Chain's submissions verbatim for ease of reference, if not comprehension.

“ 13. Clauses 2 and 3 of the NYK B/L provide as follows:-

‘2. (Clause Paramount) (1) This Bill shall have effect subject to the provisions of the International Carriage of Goods by Sea Act, 1957 of Japan, as amended on June, 1992 (hereinafter called the “Act”), unless it is adjudged that any other legislation of a nature similar to the International Convention for the Unification of Certain Rules relating to Bills of Lading signed at Brussels on 25 August, 1924, or the amendments by the Protocol signed at Brussels on 23 February, 1968, or the amendments by the Protocol signed at Brussels on 21 December, 1979, including without limitation, the Carriage of Goods by Sea Act, 1936, of the United States (hereinafter called “US COGSA”) (such similar legislation and US COGSA shall hereinafter be called “Hague Rules Legislation”), compulsorily applies to this Bill, in which case it shall have effect subject to the provisions of such Hague Rules Legislation…

3. (Governing Law and Jurisdiction) (a) The contract evidenced by or contained in this Bill of Lading shall be governed and construed by Japanese law except as may be provided for herein, and (b) notwithstanding anything else contained in this Bill of Lading or in any other contract, any and all actions against the Carrier in respect of the Goods or arising out of the Carriage shall be brought before the Tokyo District Court in Japan to the exclusion of the jurisdiction of any other courts whilst any such actions against the Merchant may be brought before the said Court or any other competent court at the Carrier’s option..’ (emphasis added)

14. In the case of S‑Net Freight (HK) Limited v Namsung Shipping Limited (Unreported, HCCL 13/2010, 3 August 2011), Reyes J had to interpret a very similarly worded choice of law clause and EJC. In that case:-

(a) The bill of lading was issued in Hong Kong, for a shipment of cargo from Hong Kong to Vietnam (at §§1‑2).

(b) There was a similarly worded clause paramount, and a choice of law clause and EJC as follows (at §8):-

‘3. GOVERNING LAW AND JURISDICTION. The contract evidenced by or contained in this Bill of Lading shall be governed by the law of the Republic of Korea as may be otherwise provided for herein, and any action against the Carrier thereunder shall be brought before the Seoul District Court in the Republic of Korea.’

(c) The learned Judge noted that the Carriage of Goods by Sea Ordinance (Cap 462) (“COGSO”), by s 3(2), compulsorily applies to all cases of carriage of goods by sea in ships where the port of shipment is Hong Kong. Therefore, by the terms of the clause paramount, COGSO was applicable to the bill of lading (at§10).

(d) The learned Judge further noted that the words “as may be otherwise provided for herein” in the choice of law clause, when read together with the clause paramount and the applicability of COGSO, created an ambiguity as to the applicable law (at §11).

(e) As the form of the bill of lading was the standard terms of the carrier, the rule of contra proferentem applied for any ambiguity to be construed against the carrier. Therefore, Hong Kong law was considered the applicable law (at §12).

(f) The use of the word “thereunder” in the EJC could be taken to mean, “under the law of Korea”. A possible interpretation of the EJC was that only claims under Korean law would be subject to the exclusive jurisdiction of the Korean Court — as the learned Judge noted, “at the very least” there was ambiguity in the wording and again applying contra proferentem the ambiguity must be construed against the carrier (at §§13‑16).

15. It is submitted that the S‑Net Freight case can be applied analogously to the present case:-

(a) The wording of the clause paramount in both cases is almost identical. Applying the analysis of Reyes J, COGSO and Hong Kong law is clearly the applicable law of the NYK B/L.

(b) As for the EJC, it is submitted that there is at least some ambiguity as to whether the EJC in the NYK B/L can be construed and interpreted to mean, “only claims under Japanese law would be subject to the exclusive jurisdiction of the Japanese Court”:-

(i) Herport accepts that the word “thereunder” which appears in S‑Net Freight does not appear in the NYK B/L.

(ii) However, the choice of law clause and EJC in the NYK B/L form one continuous sentence, connected by the word “and”, as follows:-

‘The contract…shall be governed and construed by Japanese law…and…any and all actions against the Carrier in respect of the Goods or arising out of the Carriage…shall be brought before the Tokyo District Court in Japan…’

(iii) Reading the sentence as a whole and in context, the words “any and all actions” can arguably be construed as “any and all actions under Japanese law”.

(iv) It should be noted that there are no clarifying words to the effect, “any and all actions under any applicable law”.

(v) Whilst this ambiguity within the wording of the EJC in the present case is not as strong as in the S‑Net Freight case (which Reyes J held to be at the very least ambiguous), that does not mean there is no ambiguity in the present case sufficient for the contra proferentem rule to apply.

(c) It is further submitted that there is at least some ambiguity as to whether the EJC in the NYK B/L can be construed and interpreted to mean, “only claims commenced, initiated, or originated by Herport would be subject to the exclusive jurisdiction of the Japanese Court”:-

(i) The words “any and all actions against the Carrier…shall be brought before the Tokyo District Court…whilst any such actions against the Merchant may be brought before the said Court or any other competent court at the Carrier’s option”, can be interpreted and construed to mean direct claims between Carrie [sic] and Merchant, but not inclusive of indemnity proceedings.

(ii) The plain and ordinary meaning of the word “brought” in particular suggests the commencement, initiation, or origination of legal proceedings.

(iii) The present case is strictly not an action commenced by Herport or “brought” against NYK by Herport. It is a case brought by the Plaintiffs against Herport, for which Herport seeks an indemnity against NYK by way of third party action — an extension of already proceedings already commenced.

(iv) Notably, in the specific context of the Hague Visby Rules and bills of lading, it should be noted that a clear conceptual distinction is drawn and different treatment is applied between claims for loss and damage (for which the limitation period is 1 year) and claims for indemnity (for which the limitation period may be greater than 1 year, subject to domestic legislation): see Article III (6) and III (6 bis) of the Hague Visby Rules.

(v) It should be noted that there are no clarifying words to the effect, “any and all actions against the Carrier (including claims for indemnity)”.

(d) If there is any ambiguity in either of the 2 respects as set out above, as the NYK B/L is in the standard terms of NYK, such ambiguity must be construed contra proferentem against NYK as the party who drafted and now seeks to rely on and benefit from the EJC.

(e) It is submitted that the contra proferentem rule is of particular application to the present case, as Herport and NYK appear to have adopted NYK’s standard terms without significant negotiation or discussion on the choice of law clause or EJC. There is no evidence of context or factual matrix in this regard put forward by either party.

16. In light of the analysis above, it is submitted that on a proper interpretation of Clause 3 of the NYK B/L, there is no valid EJC in favour of Japanese Courts. The burden is therefore on NYK to show on the FNC factors that there is a more appropriate forum than Hong Kong.” (emphasis added)

17.To the credit of Mr Chain, he did not press ahead with those arguments during his oral submissions at the hearing — the line of arguments and the conclusion purportedly derived from it are wholly devoid of merits.

18.First, in this court’s view, there is no ambiguity as to whether Clause 3(b) can be construed to mean “only claims under Japanese law would be subject to the exclusive jurisdiction of the Japanese Court”.[3]  Mr Chain is putting words into Clause 3(b) which are not there, and, importantly, which contradict its express terms which apply to “any and all actions against the Carrier in respect of the Goods or arising out of the Carriage”.

19.Second, there is no ambiguity as to whether Clause 3(b) can be construed to mean “only claims commenced, initiated, or originated by Herport” would be subject to the exclusive jurisdiction of the Tokyo District Court.[4]  But in any event, it is difficult to see how this so‑called ambiguity assists Herport — the Third Party claim against NYK is indeed a claim “commenced, initiated, or originated by Herport” and the submission at paragraph 15(c)(iii) that “The present case is strictly not an action commenced by Herport or ‘brought’ against NYK by Herport” is clearly wrong.  As provided in RHC O 16 r 1(3), a third party is a party to the action with the same rights in respect of his defence against any claim made against him in the third party notice and otherwise “as if he had been duly sued in the ordinary way by the defendant by whom the notice is issued” (emphasis added).

20.Third, the submission at paragraph 15(c)(i) that the words “any and all actions against the Carrier … shall be brought before the Tokyo District Court … whilst any such actions against the Merchant may be brought before the said Court or any other competent court at the Carrier’s option” can be interpreted to mean direct claims between Carrier ie NYK and Merchant ie Herport, but does not include indemnity proceedings, is also clearly wrong.  The phrase “any and all actions against the Carrier” means just that — it is difficult to see how the ambit of that phrase can or should be cut down to exclude a claim for indemnity.

21.To conclude, Clause 3(b) is a valid exclusive jurisdiction clause in favour of the Tokyo District Court and there is no burden on NYK to show that there is a clearly more appropriate forum than Hong Kong to determine Herport’s claim against it.

22.Rather, the burden is on Herport to show “strong reasons” why it should be allowed to act in breach of Clause 3(b) by pursuing its claim against NYK in Hong Kong instead of the agreed forum viz Tokyo District Court.  In this court’s view, Herport has failed to discharge that burden for the following reasons.

23.At paragraph 17 of Mr Chain’s skeleton submissions, the gist of Herport’s case is summarized as thus: “The strongest FNC factor in favour of Herport’s third party claim against NYK continuing in Hong Kong is the juridical advantages that Herport would enjoy if the third party claim continues in Hong Kong, and the juridical prejudice that Herport would suffer if its third party claim is stayed”.  The same point is repeated in paragraph 29 of Mr Chain’s skeleton submissions.

24.At paragraph 24 (e) of Mr Chain’s skeleton submissions, the so‑called “juridical advantage” if the third party action is allowed to proceed against NYK in Hong Kong is said to be this: “Ultimately, what Herport will obtain is a monetary judgment which it can rely on to attempt to recoup the indemnity claimed against NYK in different jurisdictions worldwide, insofar that it remains out of pocket”.

25.At paragraph 25(a)‑(d) of Mr Chain’s skeleton submissions, the so‑called “juridical prejudice” if the third party action against NYK in Hong Kong is stayed is summarized in these terms:

“ (a) Herport has not filed any claim in the Japanese Limitation Proceedings, and the time limit to do so has expired…

(b) Further, even if Herport could somehow participate in the Japanese Limitation Proceedings, as a matter of Japanese procedural law, the Japanese Limitation Proceedings only results [sic] in distribution of the limitation fund (which is insufficient to meet the claims) or cancellation of distribution. At no stage in this process will the Tokyo District Court issue Herport an enforceable judgement on liability, which would allow Herport to attempt to enforce in foreign courts…

(c) If Herport was to commence a claim against NYK separate from the Japanese Limitation Proceedings, such action would now be time barred under Japanese law…

(d) In any event, even if Herport’s claim was not time barred, it would have been futile to commence the action, as under Japanese procedural law it would necessarily have been postponed or dismissed pending the Japanese Limitation Action.  Again, Herport would not be able to obtain a monetary judgment…”

26.Ultimately, at paragraph 26 of his skeleton submissions, what Mr Chain relied upon as juridical prejudice is that “in the circumstances of the present case, there is and was simply no way under Japanese Procedural Law [for] Herport to obtain a monetary judgment against NYK”.

27.Given that Herport has agreed in Clause 3 of the NYK B/L that Japanese law is the governing law and that the Tokyo District Court has exclusive jurisdiction, it is difficult to see how it can now rely on the alleged juridical advantage ie Herport will obtain a monetary judgment in Hong Kong under Hong Kong law or juridical prejudice ie Herport will not be able to do so in Japan under Japanese law as “strong reasons” why it should be allowed to act in breach of Clause 3.

28.Further, the reference to “juridical advantage” or “juridical prejudice”, as well as the reference to the logistical factors relevant to FNC at Section C2 of Mr Chain’s skeleton submissions, suggest that he was purporting to analyse the “strong reasons” requirement by reference to the Spiliada principles in a totally different context ie a stay of proceedings based on forum non conveniens. Legally, this is clearly the wrong approach: Noble Power Investments Ltd v Nissei Stomach Tokyo Co Ltd [2008] 5 HKLRD 631[5].

29.In Noble Power Investments Ltd v Nissei Stomach Tokyo Co Ltd at [36]‑[40], Ma J CJHC observed as follows: 

“ 36. The extent of the burden can be put in several ways but the following provides a ready guide: strong or overwhelming reasons or exceptional circumstances must be shown, such as the existence of factors not contemplated by the parties at the time the relevant agreement was made. It perhaps matters not exactly which term is preferred, but the main point to bear in mind is that strong reasons must be demonstrated to the court before it allows the parties to be freed from their contractual bargain…

37. Thus analyzed, in the situation referred to in para 33(1), the effect of a non‑exclusive jurisdiction clause in terms of a challenge to the appropriateness of a forum, is in practice the same as an exclusive jurisdiction clause. Where an exclusive jurisdiction clause exists, a party who seeks a stay brought in breach of that agreement to refer disputes to a named forum, will have to show strong cause: see The Pioneer Container [1994] 2 AC 324, at p 347E‑G; Donohue v Armco Inc and others [2002] 1 All ER 749 at pp 759e‑760c (paras 24‑25).

38. This approach is to be contrasted with the approach of the courts in applications for stay based on forum non conveniens. Where an application is made to stay proceedings on this basis, the test is to enquire whether there exists another available forum which is clearly or distinctly more appropriate than the forum in which the proceedings are sought to be stayed and in which the case may be tried more suitably for the interests of all the parties and for the ends of justice: see Spiliada at p 476C‑D…

39. The search for connecting factors (for example, the location of relevant witnesses, the residence of the parties, etc) or the lack of connecting factors was exactly the approach adopted by the learned Recorder in the present case. It is fair to say that he regarded the correct approach as being one of weighing up the various factors to arrive at a view on the appropriate forum…

40. With respect, this was not the correct approach when there existed a non‑exclusive jurisdiction clause, and proceedings were instituted in the very forum to which the parties had agreed to submit. In such a situation, as earlier emphasized, strong reasons have to be demonstrated as to why that agreement should not be enforced. It is not a matter simply of weighing up the connecting factors as though the court were faced with a stay application based on forum non conveniens. The cases make good this point: see for example British Aerospace at p 376(1)‑(2); Marubeni at para 64; BAS at para 185. Generally, the existence or non‑existence of connecting factors will be quite irrelevant, certainly much less powerful, unless it can somehow be shown that these may constitute strong reasons as to why the non‑exclusive jurisdiction clause should not be enforced. As the authorities make clear, one is really talking about factors that were not in the reasonable contemplation of the parties at the time the agreement was made…” (emphasis added)

30.As shown by [36] and [40] quoted above, “strong reasons” must be factors that were not in the reasonable contemplation of the parties at the time the agreement was made.  In the present case, Herport has not even begun to explain why the so‑called “juridical advantage” and “juridical prejudice” were something outside the reasonable contemplation of the parties at the time the contract.  As pointed out by Mr Alder in his skeleton argument, the fact that Herport is currently faced with legal proceedings in Hong Kong but will have to proceed against NYK, if so advised, in Tokyo is an entirely foreseeable situation of its own making.  Herport had insisted on Hong Kong jurisdiction in the Herport B/Ls but placed the carriage of the subject cargo with NYK, well knowing that the latter had a Japan exclusive jurisdiction clause in its own B/Ls.  There is no evidence that Herport was unable to find a carrier operating services from Hong Kong to France which would accept Hong Kong jurisdiction.  Alternatively, Herport could have provided in the Herport B/Ls that were it to wholly delegate the carriage of the cargo from Hong Kong to France to a sub‑contractor, proceedings must be brought in the same jurisdiction as provided for in the sub‑contractor’s B/Ls.

31.To conclude, this court is of the firm view that Herport has failed to discharge the burden of showing “strong reasons” why it should be allowed to act in breach of Clause 3(b) by pursuing its claim against NYK in Hong Kong.

32.Hence, on Ground 1 alone, NYK’s application must succeed.  

33.In these circumstances, it is neither necessary nor useful to dwell on the other grounds put forward by Mr Alder in support of the application.  Suffice it for this court to record its finding that there has been material non‑disclosure on the part of Herport as follows:

(1)   First, it is well‑established that the duty of full and frank disclosure applies not just to disclosure of facts but to absolutely anything which the court should consider: Commercial Injunctions (6^th ed) para 9‑001.

(2)   Second, in particular, the duty extends potentially to matters of law: Memory Corp Plc v Sidhu (No 2) [2000] 1 WLR 1443, 1460; East Asia Satellite Television (Holdings) Ltd v New Cotai LLC [2011] 3 HKLRD 734 at [82].

(3)   Third, this court agrees with Mr Alder’s submissions that Herport should have drawn specific attention of the Master to the heavy onus on itself in seeking leave to issue and serve the 3P Notice out of the jurisdiction in circumstances where there was an exclusive jurisdiction clause in favour of the Tokyo District Court which NYK would most probably and did invoke ie the onus on Herport to show “strong reasons” for suing in Hong Kong in breach of the clause.

(4)   Fourth, this court also agrees with Mr Alder’s submissions that the reference, in the affidavit of Leung Wai Lim dated 31 July 2017 at paragraph 28, to Hong Kong being the forum conveniens for Herport’s action against NYK was both irrelevant and confusing to the Master, in light of Ma CJHC’s observations in Noble Power Investments Ltd v Nissei Stomach Tokyo Co Ltd at [38] to [40] quoted above.  

Disposition and costs order nisi

34.The Third Party’s application is hereby allowed and there shall be an order in terms of paragraphs 1 and 2 of the Summons.  Paragraphs 3 and 4 of the Summons are therefore unnecessary.

35.There shall also be an order nisi that costs of and occasioned by the Summons be to the Third Party, to be taxed if not agreed, and paid by the 1^st Defendant forthwith, certificate for counsel.

Mr Christopher Chain, instructed by Howse Williams Bowers, for the 1^st Defendant

Mr Edward Alder, instructed by Reed Smith Richards Butler, for the Third Party