The Owner of the Ship "Oriental Falcon" v. The Owner of the Ship " Tai Sang" Ex "Tyler" and Others

HCAJ000066/1974

IN THE SUPREME COURT OF HONG KONG

ADMIRALTY JURISDICTION

ACTION NO. 66 OF 1974

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Coram: Leonard J. in Court.

Date of Judgment: 31st January, 1975.

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JUDGMENT

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1. This is an application brought by way of motion by the first defendant under R.S.C. Order 18 rule 19 and the inherent jurisdiction of the court for an order that the endorsement on the writ and all subsequent proceedings including the arrest of the ship "Tai Sang" ex "Tyler" be struck out or otherwise stayed on the ground that they are frivolous, vexatious and abusive of the process of the court.

2. It is supported by the affidavit of Mr. Raphael Cheuk - yuen CHAN, a partner in Messrs. C. P. Lin & Co. , the solicitors for the applicants, filed on the 23rd December 1974 which exhibits various papers in O. J. Action No. 2435/72 ( subsequently MA. J. Action No. 51/72 which I will call "the first action" ) including affidavits and accompanying exhibits to those affidavits and details the progress of that action, in itself a sorry tale of delay. It also exhibits correspondence between the solicitors for the parties. Four affidavits sworn by Mr. J. C. C. Ferguson of Johnson, Stokes & Master, solicitors for the respondent are to be found on the court file and were brought to my attention. Two of these were in support of the application leading to the arrest of the ship "Tai Sang" ex "Tyler" and two in opposition to the application before me. To all of these affidavits various papers are exhibited to which was made before me. When the application came before me no appearance had been entered on behalf of the applicants but there was on the court file a statement of claim ( apparently irregularly filed during the vacation ) which the parties agreed should be before me as if it were exhibited to one of Mr. Ferguson' s affidavits. I agreed to hear the application, notwithstanding the failure of the applicants to enter in appearance, on counsel' s undertaking given on behalf of the applicants' solicitors to cause an appearance to be entered immediately.

3. Having regard to the multiplicity of exhibits to the various affidavits filed and the fact that some of these exhibits were affidavits which in turn exhibited further documents I had considerable difficulty in finding the papers to which I was referred in the course of the hearing. This difficulty might have been avoided had the solicitors for the parties taken the trouble to place an agreed bundle of documents before me or even to paginate the exhibits to the various affidavits. They did mot do so. This to my mind indicated a lack of consideration varying on the discourteous. It is, in my opinion, the duty of solicitors to ensure that where a complex set of documents are to be placed before the court they should for ease of reference at least be paginated.

4. The differences between the parties spring from the fact that on or about the 12th of July 1972 the vessel "Oriental Falcon" ( owned by Universal Marine Corporation a company with limited liability incorporated in Monrovia under the laws of Liberia ), on board which were a number of packed containers, ran aground on Pratas Reef in the South China Sea during a typhoon. Between the 12th July 1972 and the 14th July 1972, owing to the typhoon, the crew were "evacuated" from the vessel and the vessel may possibly have thereby became a derelict. I say "possibly" because there was no evidence as to whether the crew had left her "sine spe recuperandi" or "sine animo revertandi". What is common case is that the vessel was left unoccupied on the rocks of Pratas Reef in the typhoon and was there found by the "Tai Sang" ex "Tyler" and, it is alleged by Mr. Ferguson, on information supplied to him by Alfred N. Y. Sung ( which information may itself well have been hearsay ), by the "Lee Wai and the "Lee Hing". It is the case for the plaintiffs in the present proceedings that these three vessels "By their respective servants and agents acting in concert together with other persons unknown damaged and/or conspired to damage the 'Oriental Falcon'" her "apparel tackle equipments and/or other goods on board her" breaking open the containers and removing the cargoes contained in them and doing considerable damage to the vessel striping it of its cargo, fittings and electrical fixtures and cutting large holes in its sides through to the holds.

5. At allrelevant times the Tai Sang Navigation Co. S. A. a company of limited liability incorporated in Panama was the beneficial owners of all shares in the "Tai Sang" ex "Tyler". Its agent in Hong Kong was a Mr. LEUNG Tai trading as "Tai Song Shipping & Transportation Co.". The agents in Hong Kong for the "Oriental Falcon" were the Island Navigation Corporation Ltd.

6. The only evidence before me has been by was of affidavit and in describing the sequence of events which occurred I am not in a position decide any facts which are in issue and insofar as I appear to do so this is for the purposes of brevity. The sequence of events insofar as I have been able to deduce then from the papers before me was as follows ; By the 14th of July 1972 the ship "Oriental Falcon" had been left without crew or officers on board on the rocks at Pratas Reef. between that date and the 26th of July she was found by the 'Tai Sang" ex "Tyler" and the contents of certain containers were removed from her and placed aboard the "Tai Sang" ex "Tyler". On the 26th, 27th, 28th and 29th of July 1972 she was boarded by a Mr. Richie, ( a ship surveyor instructed by Universal Marine Corporation S. A ) with the assistance of an armed party from the Taiwanese Garrison on Pratas Island. It was claimed in an affidavit sworn by a Mr. John Alan MacDonald on the 9th of November 1972 that when Mr. Richie went on board there were about 50 to 60 people engaged in looting cargo and "that in the circumstances he welt that it would be impracticable and might indeed endanger his life if he attempted to expel the looters from the vessel". Correspondence between the parties or their agents commenced on the 3rd of August 1972 when the Island Navigation Ltd. wrote to the Tai Sang Shipping & Transportation Co. in the following terms :

On some between the 3rd August 1972 a discussion took place between a Mr. CHAU Chang on behalf of the Tai Sang Shipping & Transportation Co. and a Mr. Alfred Sung on behalf of the Island Navigation Corporation Ltd. concerning the matter. It is not clear from the papers what took place at this discussion. On the 13th August 1972 some of the cargo from the "Oriental Falcon" was discharged by the "Tai Sang" ex "Tyler" in Hong Kong and stored in the Far East Godown. There it was inspected on the 15th of August 1972 by a Mr. Alfred Sung any by Paulsen & Eayes - Davy Ltd. , Marine Surveyors and Consultants. It was claimed by the plaintiffs that on the occasion of this inspection all the cargo was not at the Far East Godown; some was stored in Kowloon at the offices of the Tai Sang Shipping & Transportation Co. On the 31st August 1972 Messrs. C. P. Lin & Co. solicitors wrote to Messrs. Lsland Navigation Corporation Ltd. in the following terms :

on the 13th September 1972 a conference was held at the officer of offices Johnson, Stokes & Master solicitors for Island Navigation Corporation Ltd. between Mr. Farguson of Messrs. Johnson, Stokes & Master and Mr. Raphael Chan of Messrs. C. P. Lin & Co. for Tai Sang Navigation Co. S. A. I had before me notes compiled by Mr. Raphael Chan as to what took place at this conference. The tenor of these notes indicates that at that time the goods detailed in the last mentioned letter were regarded by the parties having been salvaged from the "Oriental Falcon" by the Tai Sang Navigation Co. S. A., that Mr. Ferguson desired the release of the goods to Island Navigation Corporation Ltd. but that Mr. Raphael Chan would only agree to their release on condition that the ship owner would pay his clients the full amount of expenses incurred in the salvage, claimed at $306, 120. Various suggestions appear to have been made at this meeting as to the conditions for the release of the good; in question into which it is unnecessary for me to go save to remark that it would appear that the actions of those on board the "Tai Sang" ex "Tyler" were regarded as salvage rather than as pilferage throughout the meeting and that the meeting ended with a request that the " salvor " should reconsider a certain proposal for settlement and should respond to "their offers on or before the 18th of September 1972 (Monday )". On the 22nd of September 1972 the writ in the first action was issued. This writ claimed the return of the goods which I have mentioned above and damages for their detention or alternatively damages for the conversion of the goods and an injunction restraining the defendants from selling or parting with possession or otherwise dealing with the said goods to the prejudice or detriment of the plaintiffs. On the 6th of October 1972 the writ was amended as to its parties. On the 19th of October 1972 Messrs. C. P. Lin & Co. informed Messrs. Johnson, Stokes & Master that Tai Sang Shipping & Transportation Co. and Tai Sang Navigation Co. S. A. were associated concerns. In this letter they referred to the conference of the 13th September 1972, claimed that there was no dispute that their clients were salvors "of the property now the subject matter of the allegation that our clients have wrougfully detained and converted the same." and suggested that their actions as salvers entitled them to a maritime lien over the goods. On the 9th November 1972 the visit of Mr. Richie to the "Oriental Falcon" on the 26th, 27th, 28th, and 29th July 1972 was sworn to by Mr. MacDonald and his affidavit was filed on the some day. On the 10th November 1972 there was an application in Chambers when it was ordered that the first action be transferred to the Admiralty Jurisdiction of the court and that all further proceedings be stayed until further order; that Messes. Paulson & Bayes - Davy Ltd. be appointed to survey and value the goods the subject matter of these proceedings, then stored in the first defendant' s godown and that the report of such survey and valuation be filed with the court and be submitted to all parties and that the costs and expenses with regard thereto shall be paid out of the proceeds of sale of certain of the goods. On the 31st January 1973 the Tai Sang Navigation Co. S. A. Were added as defendants in the action and leave to serve notice of the writ out of the jurisdiction was granted. It entered an appearance in that action on the 1st February 1973.On the 18th December 1972 Messrs. Johnson, Sokes & Master for the first time indicated to the solicitors for the defendants on unequivocal terms that their clients regarded them not as salvors but "as nothing more than pilferous". On the 8th of February 1973 there was an order for sale of some of the goods the subject matter of those proceedings and by consent and ex parte injunction which had been granted on the 22nd of September 1972 ( i. e. the date of the issue of the writ ) was withdrawn. On the 14th November 1973 ( over a year and a month from the issue of the writ ) the statement of claim in the first action was filed and served. No explanation was given to me for this delay. The statement of claim claimed that at all material times the plaintiffs the Universal Marine Corporation were the bailees and persons entitled to possession of the goods set out therein; that all of the goods and their containers were on board the "Oriental Falcon" on or about the 12th of July 1972 when the vessel ran aground; that while the crew of the vessel were evacuated for temporary safety from typhoon and in the absence of the crew, but while the vessel and the said goods remained in the actual or constructive possession of the plaintiff company or its servants or agents, by servants or agents of the second and/or third defendants and put on board the vessel "Tyler" owned by and/or in the possession and/or control of the second and/or third defendants company; that all of the said goods were subsequently carried on board the said vessel to Hong Kong and were kept on custody of the defendants in Hong Kong; that the defendants neglected and refused to deliver any of the goods to the plaintiff company but wrongfully detained the same and/or caused the same to be detained by their servants or agents. The plaintiff company claimed damages for detention of the goods; damages for conversion of the goods; a declaration that the proceeds of sale lodged in court belonged to the plaintiff company absolutely and interest. The defence of the second and third defendants was not filed until the 8th March 1974 ( a delay of almost four months ) and was to the effect that the goods had been the subject of the salvage by the vessel "Tyler" and that that ship and transported the goods to Hong Kong and that the defendants were entitled to a lien on the goods for the costs of salvage. The defendants counterclaimed for salvage charges and for payment out to them of the proceeds of the sale paid into court. On the 12th July 1974 that is to say exactly 2 years after the "Oriental Falcon" ran aground the writ in this action ( which I will hereinafter call "the second action" ) was issued. It was not immediately served presumably because the "Tai Sang" ex "Tyler" was not then in Hong Kong. The writ is in ram against the ship "Tai Sang" ex "Tyler" the ship "Lee Wai" ( British Flag ) and the ship "Lee Hing" (British Flag) and is addressed to the owners and all other interested in the ships "Tai Sang" ex "Tyler", "Lee Hing" and " Lee Wai". By the endorse - ment of claim the plaintiffs as the owners of the "Oriental Falcon" and of three hundred containers on board and as baileos of cargo carried thereon claimod in respect of damage done to the said ship, containers and cargo by reason of the trespass and/or conspiracy to trespass and/or negligence of the first, second and third defendants their servants or agents on or about the 27th July 1972. On the 6th December 1974 having apparently done nothing in connection with the first action since they had been served with the defence and counterclaim of the 8th of March 1974 Messrs. Johason, Stokes &Master wrote to Messrs. C. P. Lin Co. the defence and counterclaim of the second and third defendants in the in the proceedings. The letter is silent as to what date they received it. They requested security for costs in the action under Order 23 rule l as against the Tai Sang Navigation Co. S. A. The last sentence of which the parties appear to have been guilty and of the fact that the plaintiffs had not, oven then, filed a reply and defence to the counterclaim in that it reads :

"You wills appreciate that this is a matter of some urgency, and we should therefore be please to hear from you in reply to this letter within the next three days."

On the 10th December 1974 Messrs. O. P. Lin & Co. replied to this letter disclaiming liability on behalf of the third defendant to provide security for costs and asking in their turn for security from the plaintiffs company incorporated in Liberia. On the 18th December 1974 the writ in the second action was served and the vessel "Tai Sang" ex "Tyler" was arrested. On the 23rd December 1974 the notice of motion the subject hereof was issued and served. It was fixed for hearing on the 30th of December 1974. On the 27th December 1974 a statement of claim in the second action was filed notwithstanding the fact that no appearance had been entered to the writ. On the same day with the consent of the defendant a reply and defence to the counter- claim in the first action was filed. This reply and defence to the counterclaim joins issue on the defnence, denies that any abandonment of the "Oriental Falcon" had taken place and denies that the vessel "Tyler" had salvaged any goods. The reply and defence goes on to rend :

"4. In further reply to the allegation in the Defence and counterclaim that the 2nd and 3rd Defendants were salvors of the said goods, the Plaintiffs will rely on the following matters as evidence of fact that the said Defendants were mere pilferers, looters hand not salvors, as alleged or at all:

5. If the 2nd and 3rd Defendants were salvors of the said goods which is emphatically denied, by reason of matters aforesaid and further by reason of matters pleaded in the Statement of Claim in the said A. J. Action 66 of 1972, the Defendants are not entitled to set off any sum or at all for alleged salvage against the Plaintiff's claim in this Action."

There was then in this reply and defence to the counterclaim a clear indication that matters in dispute in the first and second actions were closely linked.

7. The first action was and is an action for detinue and conversion of goods actually in Hong Kong and the immediate relief sought in it was an injunction to prevent the defendants from disposing of these goods and damages for detinue and conversion. It was common case that those goods came from the "Oriental Falcon " on board the "Tai Sang" ex "Tyler" owned by the Tai Sang Navigation Co. S. A. The primary purpose of the first action was undoubtedly to prevent the Tai Sang Navigation Co. S. A or the Tai Sang Shipping. Transportation Co. as its agent from disposing of there goods, it being the argument of the plaintiffs that they were not entitled so to do whether or not they had salved them As to the damages sought however, an important question for decision must necessarily be whether or not the goods were salved. It is clear from the endorsement of claim in the second action and from the statement of claim (which is before me as if it were an exhibit to one of Mr. Ferguson's affidavits) that the cause of action in the second action arises from the behaviour of the owners of the "Tai Sang" ex "Tyler" in relation to the "Oriental Falcon". If the goods the subject matter of the first action were removed by the agents of the owners of that vessel acting as salvors then trespass or conspiracy to trespass by those agents on the "Oriental Falcon" wold obviously be most difficult to make out. There would, of course, remain if the plaintiff failed to establish trespass or conspiracy to trespass, the question as to where or not as salvers of the cargo they acted negligently in relation to the vessel as is claimed in the endorsement of claim. Be that as it may, it is the case for the applicant here that both actions arise from the same transaction, that is, the entry of the applicants their servants or agents on the "Oriental Falcon" and the removal of the conisents of the containers from that vessel. Counsel for the applicants has emphasized that the entry and removal were originally admitted to be for salvage and suggested that it is manifest that the vessel was a derelict. This, however, is in issue and it is not a question which I could conceivably decide on the affidavits before me.

8. In the statement of claim in the second action the plaintiffs claim as owners of "Oriental Falcon" against the owner of the "Tai Sang" ex "Tyler" of Panama ( the applicants ) the owner of the vessel "Lee Wai" of Hong Kong and the owner of the vessel "Lee Hing" of Hong Kong. The statement of claim recites the grounding of the "Oriental Falcon" on or about the 12th July 1972 "with cargo contained n 225 containers", the evacuation of the vessel and goes on to claim that :

"On or about the 27th day of July or during a number of days around that time the 1st, dad and 3rd Defendants with their respective vessels 'Tyler' 'Lee Wai ', and 'Lee Hing' moored to other all lying at a short distance north east of 'Oriental Falcon' by their respective servants and agents acting in concert together with other persons unknown damaged and/or conspired to damage the 'Oriental Falcon' and her apparel, tackle and equipments and/or the said 225 containers and/or other goods on board the 'Oriental Falcon', thus causing loss and damage to the Plaintiff."

Particulars of damage to the No.1, 2, 3, 4 and 5 holds, to the containers therein ("with contents removed by the Defendants") to the engine room including machinery therein follow. It is alleged that brass and copper fittings including electrical equipment cables turbo generators spares and tools were stripped that the vessel was systematically looted. It is alternately alleged that if the defendants were salvors ( which is denied ) they acted negligently in the operation of salvage whereby total loss of the vessel was occasioned. Counsel for the plaintiff (who drafted the statement of claim) was at pains to point out before me that insofar as damage to cargo or goods on board the vessel was alleged or claimed the cargo or goods concerned were not inclusive of or intended to be inclusive of those he subject matter of the claim in the first action. If this was his intention, and of course I must accept his personal assurance as to this, the statement of claim is in places info unfortunately worded - I must, I consider, nevertheless interpret its claim as being exclusive of the cargo the subject matter of the first action because of the assurance I have had from counsel.

9. An affidavit filed by Mr. Ferguson of the solicitors for the plaintiff filed on the 18the December 1974 in the second action based on information supplied by a Mr. Alfred N. Y. Sang (which itself may well be hearsay) seeks to support for the purpose of the arrest of the "Tai Sang" ex "Tyler" the facts alleged in the statement of claim and includes a statement that the plaintiffs' claim is for approximately HK$5,100,000 with interest and costs.

10. A further affidavit sworn by Mr. Ferguson in reply to that sworn by Mr. Raphael Chan filed on the 23rd December was filed herein on the 28th December 1974. In the course of this affidavit Mr. Ferguson avers that it was for purposes of negotiation only that the plaintiff would consider treating the first defendant as salvors" and that "It was never implied indicated or admitted either by the plaintiff or their solicitors that the first defendants were salvors". Presumably Mr. Ferguson intends to indicate either that the Island Navigation Corporation Ltd. had no authority so to imply indicate or admit in choir letter of the 3rd August 1972 or that this letter does not do so. I re ret that he did not condescend to an explanation of this averment which on the face of it appears inaccurate. Be that as it may, I must for the purpose of the application before me proceed on the basis that that it is in issue whether the applicants were s lvors and also whether the plaintiffs have ever implied indicated or admitted that they were.

11. On the basis of the papers, counsel for the applicants would have me hold that these proceedings should be struck out on the ground that they are vexatious arguing that as soon as she papers show that the plaintiff seeks to maintain two actions arising from the same subject matter the second of these actions is prima facie vexatious. He brought me first to the case of Poulett v. Hill ⁽¹⁾ a case in which as writ specially endorsed for the sum of $1,106.18s. 3d. being two years' interest on a mortgage less certain sums was used as the basis for an application under Order 14. The plaintiff in that case had previously launched an action by a generally endorsed writ in which he as mortgagee claimed payment of $34,612 due on his mortgage plus interest and accounts, foreclosure n default of payment, the appoint of a receiver and an injunction against cutting timber. In the earlier action a receiver had been appointed and an order for sale had been made, the pleadings were closed but notice of trial had not been made, the pleadings were closed but notice of trial had not been given when the application under Order 14 in the later action was filed. It was held that the later action was vexatious on the basis that it was unnecessary, in that the plaintiff could obtain in the first action everything to which he was entitled and which he sought to recover in the second action; this notwithstanding that an application for summary judgment was not open to him in the first action. Counsel went on to cite Williams v. Hunt ⁽²⁾. In that case the defendant had mortgaged to the plaintiff certain premises for the sum of £400 with provision for repayment quarterly. In an action ...(illegible) in May 1904 in the Chancery Division the plaintiff claimed an account of all sums due by the defendant under the mortgage dead, payment of the amount found due, and in default, sale or foreclosure. The defendant alleged that nine of the instalments covenanted to be paid had been paid to the authorized agent of the plaintiff and that the only question to be tried was whether the person who received them had done so as agent for the plaintiff and that he was roady and willing to pay the amount actually due so soon as the question of agency should have been determined. Notice of trial was given and proceedings in the King's Bench were then started on a specially endorsed writ issued by the plaintiff; an application was made under Order 14. The Master granted a stay and an appeal to a single judge resulted in the removal of the stay and leave to defend on payment in of the sum of $167 3s. 9d. (an amount due to the plaintiff in any event whether or not the question of agency was resolved in favour of the plaintiff or the defendant). Counsel for the applicants referred me in particular to the following passage from the judgment of Collins M. R. at page 514 :

"Where two separate remedies are possible, and a start is made by putting in force one of those remedies by a writ which would entitle the plaintiff to the relief he subsequently desires, he cannot by deliberately leaving that out of his claim reserve his right to ask for it in another proceeding ... it is an abuse of the process of the court to divide the remedy where there is a complete remedy in the court in which the suit was first started."

That , argued counsel for the applicants, was precisely what the plaintiffs were seeking to do in the present case. The matter of which they complained had its origin in the removal of the goods in question from the "Oriental Falcon". At the same time as he claimed in respect of those goods the plaintiff could have and should have claimed in respect of the damage to the vessel. He had elected to commence his first proceedings in personam. In those proceedings he could have obtained relief, it was argued, equally in respect of the damage to the vessel if such existed. It is, however, to be noted that the judgment in Williams v. Hunt(2) continues :

"In this case personal payment was not asked for in the writ in the Chancery Action, and that appears to have been because the plaintiff desired to put in operation the remedy under 0. 14 and have recourse to two separate proceedings in the first of which she might have got all the relief to which she is entitled."

The case is then not authority, of itself, for the contention that where the plaintiff seeks in subsequent proceedings relief which was not and would never be available to him in earlier proceedings (e. g. the security given by an action in rem ) he cannot commence that in rem because he had already commenced an action in personam in respect of a claim linked with that for which relief is sought in the subsequent proceedings. In the Marinero ⁽³⁾ the "Crossington Court" a vessel in the ownership of the plaintiffs collided with the "Marinero" in Argentine Waters. The plaintiffs arrested, in Holland, the Arriero, a hip in the same ownership as the "Marinero". The defendants sought the release of the "Arriero" from the Dutch Courts and gave security conditional on the Dutch Courts exercising jurisdiction. The "Arriero" was released. Later the plaintiffs arrested the "Marinero" in Liverpool and commenced an action in rem in England. It was held that, as the plaintiffs had perfectly good security in Holland, the proceedings in England were vexatious notwithstanding the fact that it was the "Marinero" - the ship which was subject to the maritime lien - that was arrested in England. The ratio decidendi of this case is I consider to be found at page 72 of the report :

"In the present case, as in the Christiansborg, the effect of what was done in Holland (i. e. the taking of security on the release of the 'Arriero' ) was to purchase the further immunity of the 'Marinero' from arrest in respect of this collision".

This case again is in sharp contrast to that before me in that there has been no "purchase of immunity " in the case before me and the plaintiffs have no security by virtue of the first action. Counsel also referred me to the case of Peter T. H. CHUA v. CHOW Ching-san ⁽⁴⁾, a case in which the plaintiff brought proceedings by a generally endorsed writ for dissolution of partnership and for accounts and inquiries. On the same day he brought proceedings by a specially endorsed writ, claimed accounts in respect of the same partnership under Order 2 rule 19 of the Code of Civil Procedure and took out a summons for judgment. The second action was held vexatious, and so it clearly was, for "it emerged quite clearly during argument that the plaintiff's chief reason .... was..... to strengthen plaintiff's position in the first action." (per Roynolds J. at 321). This case is however noteworthy for a quotation from Nchenry v. Lewis⁽⁵⁾ where Jessel M. R. says at page 400:

"In this country, where the two actions are by the same man in courts governed by the same procedure, and where the judgments are followed by the same remedies it is prima facie vexatious to bring two actions where one will do."

The qualification I have underlined is of importance. Counsel for the applicants sought to take the matter one step further by reference to Slough Estates Ltd. v. Slough Borough Council end Another ^(6). In that case there were concurrent proceedings before distinct tribunals. In October 1945 a planning permission had been granted to the plaintiffs to use their property for industrial purposes conditonal on subsequent approval by the local planning authority for further particulars of development. This permission was not relied upon by the plaintiffs after 1952. The plaintiffs subsequently wished to develop the land by the erection of factories and warehouses while the Borough Council wished it to be left for carparks. The Minister directed a local inquiry which was held in January 1966. In one instance however the plaintiffs applied for approval of particulars of factory development relying on the orignal planning permission. On the rejection of this application the plaintiffs appealed to the Minister in order to obtained a decision as to whether the original planning permission remained effective. By an originating summons the plaintiffs applied to court for a declaration that the original planning permission did remain effective. After argument on the question as to whether the court should direct a stay of proceedings in accordance with the proviso to Section 41 of the Supreme Court of Judicature (Consolidation ) Act, 1925, the plaintiffs withdrew their appeal to the Minister who accepted withdrewal and decided the application for planning permission no it was before him. It was held that the duplication of the proceedings was vexatious. In the course of this judgment Ungeed-Thomas, J. quoted with approval a passage from the dissenting judgment of Lord Esher M. R. in the Christiansborg ⁽⁷⁾ at page 148 as follows :

"Where both actions are in England in the same tribunals - because if they are in tribunal's where the proceedings are not identical or the remedies are not equally effective the law would apply which is applicable to foreign countries - prima facie it is vexatious, and therefore it would lie on the party who brings the second action to show that it was not so. But where the cases are in foreign countries, prima facie not being vexatious, the man who says it is, must prove clearly to the court that it is, and that the person suing him in a court with ample jurisdiction would have in every respect the same chance in a foreign court which he has here, and equal facility to enforce the remedy."

He goes on to say :

"So if in this case the proceedings are identical and the remedies equally effective, prima facie the duplication is vexatious. It was not disputed that the remedies provided by the Minister's and the court's decisions are substantially equally effective. The proceedings are different, but it was not suggested that any differences are matters of substance or relevance. No advantage was claimed for the one procedure over the other, except that it was hoped by the plaintiffs that this court might be more expeditious than the Minister, a hope which in the event was hardly put to the test, and to the extent to which it was put to the test was belied."

On this authority counsel for the applicants relied to suggest that these proceedings were prima facie vexatious and that that the plaintiff should have at least to be put to his election as to which of the proceedings he wished to continue. This is to ignore a distinction of substance between the two sets of proceedings in question before me for in the first of them the plaintiff could have no security for his claim in the second, those in rem, he was able to effect the arrest of the ship as security.

12. Counsel went on to consider Greenhalgh v. Mallard⁽⁸⁾. That case turned on a question of res judicata. Counsel contended that the principle behind it was that there issues or facts are so clearly part of the subject matter of the first litigation and could have been raised in that first litigation it would be an abuse of the process of the court to allow them to be raised in subsequent litigation. Counsel relied in particular on the words which I have underlined in the following passage from the judgment of Lord Justice Somervell at page 257:

".... but counsel for the defendants put his case in two ways, and I will deal with them. He relied, first, on res judicata, and then said that, if there was any doubt about that, he was entitled to succeed on the ground that it would be vexatious and an abuse of the process of the court to allow this transaction to be brought before the court again on the basis of the present statement of the claim. I think that on the authorities to which I will refer it would be accurate to say that res judicata for this purpose is not confined to the issues which the court is actually asked to decide, but that it covers issues or facts which are so clearly part of the subject matter of the litigation, and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be started in respect of them. In Green v. Weatherill (1929) 2 Ch. 221, Maugham, J. quoted some observations by Wigram, V. C. , in Henderson v. Henderson 3 Hare 114:

The plaintiffs not having brought forward the entirety of his claim in the first action as, suggested counsel for the applicants he could have done, it would be vexatious to permit him to do so now. I could not cavil at that oft-quoted passage from the judgment of Somervell L. J. and at this stage merely pause to refer to his reiterated use of the words "so clearly"; for what he is there saying is that there is an extension of the doctrine of res judicata to cover issues the re-litigation of which would be an abuse. He is not enlarging the concept of abuse but that of res judicata.

13. A second matter upon which reliance was placed by counsel for the applicants arose from the correspondence which took place as to security for costs. Notwithstanding the fact that Mr. Ferguson of Johnson, Stokes & Master has sworn in ...(illegible) 11 of his affidavit filed on the 18th of December 1974 that the plaintiffs' claim in the second action is for approximately HK$5,100,000, Mr. Bernacchi contended that it is manifest that the only reason for the second action is to force the defendant to put up security in the first action which he had failed to get in a result of correspondence. He argued that that is a clear indication that the proceedings were an abuse of the process of the court. He cited in support of this contention the Cap Bon⁽⁹⁾. The following passage from the judgment of Brandon J. is in point :

"In my view, the plaintiffs' approach to this matter is based on a misconception. In my view when an action in rem is brought the security thereby obtained is security in respect of any judgment which may be given by the court after hearing and determining the claim. The security so obtained also covers the payment of any sum which may become due under an agreement whereby the action is settled. But the security so obtained is not in my view available for the purpose of ensuring payment of the judgment of some other court or for the purpose of ensuring payment of the award of an arbitration tribunal."

At a later stage in his judgment having commented on Section 3(4) of the Administration of Justice Act, 1956 Brandon J. goes on to say :

"It is to be inferred from that that the object of the process in rem is to provide security for a plaintiff in respect of any judgment which he may obtain as a result of the hearing and determination of a claim. That is the purpose of proceeding in rem, and, subject to the point I made, that it covers also payment of a sum due under a settlement in an action, it is the sole purpose of such process. It seems to me that in the present case the plaintiffs have sought to invoke the Admiralty Jurisdiction for a wholly different purpose .... security for the payment of an award in an arbitration ... Bail in an Admiralty action in rem represents the res, and it follows in my view that the Admiralty Court has no jurisdiction to require bail as a condition of release. To maintain that bail for the collateral purpose to which I have referred."

In the Golden Trader ⁽¹⁰⁾ it was not contended that the Cap Bon⁽⁹⁾ was wrongly decided.

14. The question facing me in the light of these authorities on the second limb of the applicant's argument is, then, whether or not it is established that this action was commenced for the purpose of obtaining security in Admiralty Jurisdiction No. 51 of 1972 It is true that the plaintiffs asked for security for costs (presumably the costs of the counterclaim in the first action) as recently as the 6th December 1974 and that their request was refused. After this refusal these proceedings were served on the defendants' ship. However these proceedings were commenced by the issue of the writ the endorsement on which I am requested to strike out, on the 12th July 1974. That the writ was not served or mentioned to the applicants' solicitors until the 18th December 1974 may well have been due to the absence from Hong Kong of the "Tai Sang" ex "Tyler" between the 12th July 1974 and the 18the December 1974. Certainly there is nothing in the papers to show that she was in Hong Kong between July 1974 an December 1974; the last date upon which she was shown to have been in Hong Kong was in August 1972. There is nothing in the papers before me to suggest that these proceedings were commenced or served to obtain security for costs or indeed for any other purposes then to obtain security for the satisfaction of the claim to which reference is made in the statement of claim in these proceedings. This is sufficient to dispose of the argument of the applicants insofar as it is based on the Cap Bon⁽⁹⁾and the Golden Trader⁽¹⁰⁾.

15. Counsel has however been at pains to contend that in the light of the other authorites, in particular, he suggesta, in the light of the passage from Lord Esher's judgment in the Christiansborg ⁽⁷⁾ and the case of Slough Estates Ltd. v. Slough Borough Council⁽⁶⁾ extended he suggests by a line of cases which prevent a litigant having 'two bites at a cherry" (such as Greenhalgh v. Mallard⁽⁸⁾ that he he not go so far as to show that the purpose for which the second action was issued was improper. The fact that there have been two separate sets of proceedings "arising from the same subject matter' is, he suggests, sufficient of his purposes. Now, it is common case that the goods in respect of which the plaintiff sued in the first action were taken by the applicants from the "Oriental Falcon' when she lay on the rooks unattended by her crew in July 1972, but the removal of the goods from "Oriental Falcon" is not the fact of which the plaintiff complains in that first action. What he complains of there, is the detinue of the goods and their conversion while they were in Hong Kong,. That he has some justification (and I do not wish to ...(illegible) that this justification is adequate) for his allegation that there has been detinue and conversion in Hong Kong, is shown firstly by the fact admitted in the letter of the applicant's solicitors there was a treat to sell the goods 'salved' and secondly by the fact (appealing Arom a surveyor's report about which there may later be dispute) that some air conditioning apparatus and some metal were not available for inspection by the surveyors although admittedly brought to Hong Kong by the "Tai Sang" ex "Tyler".

16. It is clear from the papers that the immediate remedy which the plaintiff sought in the first action was an injunction to prevent the disposal of the cargo that had actually been brought to Hong Kong. The essential complaint there was not as to the removal of the goods from the vessel but as to proposed dealing with the goods in Hong Kong. Counsel for the plaintiff points out that it is noteworthy that the first attempted contact in Hong Kong came from the plaintiff's agents, the Island Navigation Co. Ltd. to the defendants' agents, on the 3rd August 1972 some three weeks after the grounding. [To this counsel for the applicants might well reply that it is noteworthy that in that very letter reference is made to salvage.] What is undoubted is that on the 31st August 1972 came a threat to sell the goods. Neither the maritime lien nor any possessory lien, if such was enjoyed by the defendants conferred a right to sell. The threat to sell was followed by the conference on the 13th September 1972. From the note of this conference put forward by the applicants' solicitors that meeting concluded with a request from the plaintiff to the applicants that the applicants should communicate with the plaintiffs within a fixed period. Immediately that period had elapsed the writ in the first action was issued and it was accompanied by an application for an injunction for the protection of the goods (be they salvaged or pillaged). I have little doubt but that the motive of the plaintiffs in seeking that injunction was fear that the goods might be disposed of and any security which they might enjoy by reason of the availability of the goods be lost.

17. On the 13th September 1972, if the notes of the conference kept by the solicitors for the applicants are to be regarded as correct, the applicants had acted as salvors insofar as the goods taken to Hong Kong were concerned; they had saved those goods from the wreck or the derelict or to put it as the plaintiffs would have it the "evacuated" vessel; assuming for the moment that they were salvors (a suggestion apparently not denied until Mr. MacDonald's affidavit on the 9th November 1972) they were scarcely acting as salvors should, in Hong Kong, for they had threatened to sell the goods, and, say the plaintiffs, they had detained them unlawfully by failing to put forward a supported claim for salvage charges and by refusing to release the goods on the offer of payment of a proper sum for salvage charges. The applicants suggest that the plaintiffs could, it they so wished, have sued in the first action for all the relief they now claim. They could have had all the necessary information before they when those proceedings were started in September 1972 for Mr. Richie was on the "Oriental Falcon' as early as 26th July 1972. The first action is they claim inextricably bound up with the second action as is clear from the reply and defence to counterclaim in the first action which makes express reference to the facts pleaded in these second. That may well be so but I have been shown no authority which convinces me that they were obliged to do so. The two subject matters were by no means identical. In the first action they were seeking to protect cargo; in the second they seek damages in respect of the ship itself its containers fittings and fixtures (and not according to counsel, cargo the subject matter of the first action). Again, detinue and conversion of goods in Hong Kong is by no means the same cause of action as conspiracy and the other wrongful acts complained of in the second action which took place it is alleged, not in Hong Kong but on Pratas Reef. Fourthly while they could have some assurance of recovery, if successful, when they issued their writ in the first action - the cargo was here - they could have had no security for the payment of the damages that might be found due for the injury to the ship. They might have sued in rem when they brought the first action but the papers disclose no res available for seizure - other than the cargo - and the whole purpose of proceedings in rem is to obtain security. I am far from being satisfied as to the validity of the defendants' claim that they are being attached twice in respect of the same subject matter. All I can be satisfied of at this stage is that the subject matters of the two action spring from the grounding of the "Oriental Falcon' and the entry of the applicants on her. To suggest that they, therefore, arise from the same transaction or from one subject matter is I consider misleading.

18. That is enough to dispose of this application.

19. Let us however assume that I am incorrect and that both actions can properly be said to arise from the same transaction and each to involve part of the same subject matter is this enough to enable the applicants to succeed?

20. While not admitting that the remedies sought by the plaintiffs were inconsistent or that there was any overlapping between the remedies sought in the first action and the second action counsel for the plaintiffs argued that even if the actions were identical he was entitled to maintain the second action on the basis that an action in rem presents a complementary or cumulative remedy. For this proposition he cited the Orient⁽¹¹⁾. In that case there had been a general denial pleaded in answer to a claim of damage in the Admiralty Court and a special defence that the damage complained of was the same as had already been adjudicated upon th the Court of Common Pleas and the judgment obtained and satisfied. In the hearing at the Admiralty Court it was proved that the damage was done by a consignee for sale of the vessel and not by the agent on behalf of the owners. The judge of the Admiralty Court held that the suit could not be maintained on that account but as that defence not been specifically pleaded he declined to give the defendants their costs or to go into the special defence i. e. that the damage complained of was the same as had already been adjudicated upon in the Court of Common Pleas. There was an appeal against this ruling and it was held that the general denial pleaded in answer justified the evidence produced and that the defendants were entitled to have the judgment of the court as asked on the special defence pleaded so that the appellant was entitled to his costs and the appeal was not one involving costs only. In the course of the judgment of the Privy Council delivered by Sir Joseph Napier there appears the following passage at page 702 :

"It appears on the admissions of the plaintiffs that, before this proceeding was commenced, the sum for which judgment was recovered in the action at law had been paid. If the security for damages adjudged and not paid was sufficient, or if the owners of the ship were responsible but insolvent, the plaintiff would have had a cumulative remedy by proceeding in rem in the court of admiralty; but it could only be to realise one compensation for the same cause of actions. Whether it is a remedy both in personam and in rem a person who has resorted to one of the remedies may, if he does not get thereby fully satisfied, resort to the other. Here the plaintiffs proceeded against the party ho was the primary trespasser and properly responsible. The amount of compensation for the damage which the law had reduced to certainty in the action had been paid; and having been by the law so reduced to certainty, and the amount proceeding there was an end of the matter both in law and justice."

The proposition that the plaintiff would have a cumulative remedy by proceeding in rem in the court of admiralty appears to me to be obiter. I was referred to no later authority or textbook ...(illegible) the case was cited as authority for that proposition but, if obiter it is obiter coming from the best possible source; so that even if it did not appeal to me as sensible I would be loath to differ from it so as to strike out proceedings in rem brought by a litigant not already satisfied by proceedings in personam which he had taken for the same cause of complaint. I say this because it has been reiterated again and again in the authorities that a proceeding in rem is brought for the purpose of obtaining security and that is its only essential purpose. I have already quoted from the Cap Bon⁽⁹⁾ to this effect. In the Soya Hargareta ⁽¹²⁾ it was alleged that certain cargo abroad the "Soya Lovisa" a vessel in the same ownership as the "Soya Margareta" had become contaminated abroad the "Soya Lovisa". On the discharge of this cargo in Venice an action in personam was commenced against the defendants there. Later the plaintiffs claimed arbitration in London and both sides appointed arbitrators. In the same month as that in which the arbitrators had been appointed the plaintiffs issued a writ in rem against the "Soya Margareta" and arrested it while it was in England. The defendants gave notice of motion to set aside the writ in the English action or for an order that all further proceedings be stayed on the ground that it would be oppressive and vexatious to allow the plaintiffs to proceed with three separate actions in respect to the same claim. The following passage occurs in the judgment of Hewson J. and I find its reasoning compe ling:

"Mr. Mocatta has not been slow to urge upon me that this action in this court is also a vexatious one in that the plaintiffs have instituted no less than three separate actions in respect of their claim."

[I pause to remark that three actions were in respect of the same identical claim and the same cause of action, the contamination of the cargo, rather than in respect of different claims or over- lapping claims and different causes of action]

Leaving aside for the moment the effect of the obiter from the Orient ⁽¹¹⁾ as to the remedy in rem being cumulative I must confess to some initial at attraction (because the plaintiffs' first elected to go by an action in personam) to the argument advanced by Mr. Bernacchi that once two actions in the same jurisdiction are shown to arise from the same subject matter or out of the same transaction the second is prima facie vexatious and that therefore in this respect the position of the plaintiffs may be slightly less favourable than it was in the Soya Margareta ⁽¹²⁾ .That case is authority for the importance of preserving to a litigant the right to sue in rem particularly were as in this case unlike the case of the Soya Margareta ⁽¹²⁾ no undertaking or other security has been forthcoming form the defendants. My initial attraction to the argument that the second action is prima facie vexatious is dissipated by the qualification in the passage from the judgment of Lord Esher in the Christiansborg ⁽⁷⁾ to the effect that where both actions are in tribunals :

In our case the remedies are not equally effective because no security is given by the action in personam and it is therefore for the applicants to show vexation not for the plaintiffs to show that it is absent. The Atlantic Star ⁽¹³⁾ was a case of a collision in Belgian waters between a Dutch vessel an the Belgian barge. Proceedings were commenced in Antwerp but in June 1971 when the "Atlantic Star" was due at Liverpool proceedings in rem were commenced in England against her. Her owners to avoid arrest accepted the service of the writ entered a conditional appearance arranged security in respect of the claim and in July 1971 is ued a notice of motion to say the action. Essentially the question was which was the most appropriate forum and the considertion applicable were therefore to a considerable extent dependent upon the balance of convenience. The case emphasises however that such words as "vexation" and "oppression" are to be "widely interpreted in relation to the circumstances and in the light of the fact that the court's discretion is general. Essentially of the fact that the court's discretion is general. Essentially that general discretion must be exercised so that it will not cause injustice." I cannot see what injustice will be caused if the two actions involved here are allowed to proceed and particularly if, as the plaintiffs have clearly indicated there will be, there is an application made for consolidation. To sum up I am not satisfied that they "arise from the same transaction" this is using that expression at its widest. If they are to by regarded as arising from the same transaction and even if as a consequence I should regard the proceedings as vexatious until the contrary is shown which again I do not accept. I consider that the nature of the proceedings which the plaintiffs are now bringing, the desirability of the plaintiffs having some security for due payment of damages for the conspiracy and the negligence alleged should the same be proved and the nature of the remedy in rem are factors sufficient to rebut any presumption of vexatiousness and that justice would not be done by putting the plaintiff to any election as to which of the two proceedings he should pursue. In these circumstances I dismiss this application with costs.

Representation:

Mr. William Waung (Johnson, Stokes & Master) for plaintiff.

Mr. Bernacchi, Q.C. and Mr. M. Asome (C.P. Lin &.( for 1st defendant.

2nd and 3rd defendants absent.

(1) (1893) 1 Ch. 277.

(2) (1905) 1 K. B. 512.

(3) (1955) P. 68.

(4) (1956) H.K.L.R. 317.

(5) 22 Ch. D. 397.

(6) (1967) 2 All E.R. 270.

(7) (1885) 10 P.D. 141.

(8) (1947) 2 All E.R. 255.

(9) (1967) 1 Looyd's List Law Reports 543.

(10) (1974) 3 W.L.R. 16.

(11) (1869) 3 P.C. Appeals 696.

(12) (1961) 1W.L.R. 709.

(13) (1974) A. C. 436.