Nucron Pharmaceuticals Ltd. v. The New India Assurance Co. Ltd.

HCCL000308A/1998

HCCL308/98

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO.308 OF 1998

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Coram : The Hon Mr Justice Stone in Chambers

Date of Hearing : 4 November 1999

Date of Delivery of Judgment : 4 November 1999

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J U D G M E N T

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1. There is before this Court an application for summary judgment by the Plaintiff herein pursuant to its summons dated 1st April 1999. This is the second recent interlocutory skirmish between these parties, the Defendant earlier having sought to stay these proceedings on the basis of forum non conveniens in favour of the High Court of Bombay, an application refused by this Court pursuant to its judgment delivered on 7th October 1999.

2. As this latter judgment related, in this action the Plaintiff claims against the Defendant under a cargo insurance policy of which it is the assignee. The insurance related to a cargo of chemicals of which the Plaintiff was the buyer from one Indotech Limited ("Indotech") pursuant to a Sale Contract dated 5th June 1997. On 29th July 1997, Indotech took out the policy which was later assigned to the Plaintiff and under which, in consideration for premiums paid, the Defendant agreed to insure the cargo against specified risks or loss or damage during carriage of the same from Shanghai to Mumbai, India.

3. This cargo of some 60 drums of chemical (which I understand to be Carbamazepine BP88) was stuffed into a container at Shanghai and was devanned and restuffed upon transshipment in Hong Kong. However, when the container arrived at Mumbai on 24th August 1997, these 60 drums were missing, although curiously the container seal apparently had remained intact. Accordingly, having paid Indotech the sum of US$57,750, the Plaintiff now claims to be indemnified by the Defendant under the insurance policy. But the Defendant has refused so to indemnify, hence the bringing of this claim.

4. The Defence filed by the Defendant amounts to little more than a bare denial and the putting of the Plaintiff to proof. In the affidavits filed in support of the Defendant's opposition, a number of diverse matters are raised, albeit in his submission Mr Sundaramoothy for the Defendant elected to run one fundamental line of argument, namely, that in the circumstances there was a triable issue as to whether the goods had indeed been lost as alleged, although at the same time he pointedly did not allege fraud on the part of the Plaintiff in making its claim under this policy and in prosecuting this action in terms of the affidavits sworn in support thereof, so that on occasions he trod a somewhat tenuous line.

5. In his address Mr Sundaramoothy concentrated upon what he submitted were inconsistencies in the collateral documentation which had been obtained by his client as to the circumstances of this loss - in particular he placed reliance upon correspondence from the carrier, P & O, to the Plaintiff during the period of late in August 1997 to early November 1997 which consisted of formal reminders to collect uncleared cargo at the dockside, and one computer-generated letter from Total Transport Systems Pvt. Ltd., the carrier's shoreside delivery agent, which referred to an unclaimed 60 drums of the chemical in question, for which the Delivery Order had not been collected and for which there had been no cargo clearance.

6. Mr Sundaramoothy is, of course, entirely correct to draw the attention of the Court to what appear to be contradictions in the Plaintiff's case, although upon analysis I do not think there are of any great significance.

7. Mr Laracy for the Plaintiff placed reliance not only upon the sworn evidence as to the fact of the loss of this cargo of 60 drums of chemical, but also upon certain important contemporary documents. In particular, he stressed the importance of the tally record of the stevedores who actually destuffed the relevant container, only specifically to note the missing 60 drums - see the record of M.Dinshaw & Co. Pvt. Ltd. dated 1st September 1997, with the annotation as to the shortage thereof (at page 10 of the exhibit to Mr Medhekar's affidavit of 5th August 1999), together with the letter from Total Transport Systems Pvt. Ltd. dated 9th January 1998 certifying their lack of success in locating the 60 drums within the container (at page 9 of the same exhibit), and Total's further letter of 15th October 1999 (at page 22 of the exhibit to Mr Medhekar's second affidavit) again confirming the devanning of the relevant container on 1st September 1997 and the fact that the cargo was not found during the unstuffing by Messrs Dinshaw & Co. Conversely, said Mr Laracy, the Total letter of 21st September 1997 was not only computer-generated, but was posted at a time when Nucron, his client, clearly had been made aware of the non-arrival of this 60 drums, whilst the 'reminders' generated by the carrier, P & O, were obviously misguided and, he said, had little weight given that P & O's letter to Indotech, the seller of the chemicals to Nucron (at page 32 of the exhibits to the third affidavit of Mr Medhekar) stated, inter alia, that :-

"Apparently 60 drums of carbamazepine has not landed from the container No.PONU 0407132. Since no delivery order was taken against the aforesaid 60 drums, cargo arrival reminders were sent on a routine basis as according to the terms of contract the merchant is still liable to pay for charges."

8. Looked at in totality, in my view the evidence put up by the Plaintiff is strong and highly persuasive, and notwithstanding Mr Sundaramoothy's valiant efforts on behalf of his client, the material relied upon by the Defendant contains little of substance and is no more than an attempt to make bricks without straw. In effect, Mr Sundaramoothy pointed to what are perceived ambiguities in collateral third party documentation, notwithstanding the best evidence in the form of the Dinshaw tally and the subsequent signed confirmatory letters from Total Transport Systems as to the true position, and then used such 'ambiguities' as a forensic lever to get to discovery and trial on the basis that something, Micawber like, might turn up.

9. I do not think that I should countenance this approach. This Court generally regards Order 14 applications through an indisputably narrow prism, and I have of course reminded myself of the well-known principles relating to summary judgment applications. However, in my view the Defendant in this case has failed to satisfy me on this evidence that there is a fairly arguable point to be made on its behalf, or that it has demonstrated a reasonable probability of establishing a real or bona fide defence such that the matter should be permitted to go to trial.

10. In this connection, I confess that I did wonder whether, possibly as an alternative course, I should have ordered conditional leave to defend, but on reflection I have concluded that this would be to fudge the issue, and that on these papers and notwithstanding, as I have said, the forensic ingenuity of Mr Sundaramoothy, that the Plaintiff is entitled to judgment.

11. Mr Sundaramoothy raised no point about the value of the claim - this cargo was insured under this cargo policy No.922602/21 402528 in the amount of US$63,525, which Mr Laracy told me is the usual formula of the CIF value plus 10%, albeit the claim is presently limited to the Indotech invoice value of the goods, namely US$57,750.

12. In the circumstances I give judgment to the Plaintiff for damages for the Defendant's breach of the policy in failing to indemnity thereunder in the sum of US$57,750.00. Subject to anything the parties may say, I intend to order interest on the said sum at the rate of 8% from 1st February 1998 to 4th November 1999 inclusive, and thereafter upon the principal sum at the judgment rate from time to time prevailing until payment.

13. The Plaintiff is to have the costs of this action, including the costs of and occasioned by this application, to be taxed if not agreed.

14. I thank the parties for their assistance.

Representation:

Mr Laracy of M/s Sinclair Roche & Temperley, for the Plaintiff

Mr Sundaramoothy of M/s Miller Peart, for the Defendant