Fukuyo Industries Corporation and Others v. The Owners of the Ship or Vessel "Griesheim" (West Germany Flag) Now Renamed "Vivacity" Panamanian Flag)

Case No.CACV 70/1983

Court

Court of Appeal

Date—

Judge—

Case Document

100%Judiciary

CACV000070/1983

IN THE COURT OF APPEAL	1983, No. 70
	(Civil)

BETWEEN

	FUKUYO INDUSTRIES CORPORATION, OKURA AND CO. G.M.B.H., FEINSTAHL AG, SCHWEIZ KOKOMOTIV-UND MASCHINENFABRIK, HUETTENPRODUKTE A.G. PESTALOZZI, GARL STUERM, UNION UMSCHLAGS A.G., METALLWERKE A.G., and all other persons interested in the cargo now or lately laden on the ship or vessel "GRIESHEIM" (West Germany Flag) now renamed "VIVACITY" (Panamanian Flag)	Plaintiffs (Respondents)
	AND
	THE OWNERS OF THE SHIP OR VESSEL "GRIESHEIM" (West Germany Flag) now renamed "VIVACITY" (Panamanian Flag)	1st Defendants (Appellants)

	and

	M.S. GRIESHEIM UNTERWESER REEDEREI BETEILIGUNGS SCHIFFAHRT GESELLSCHAFT M.B.H. AND CO. K.G.	2nd Defendant

	and

	NAKAMURA STEAMSHIP CO. LTD.	3rd Defendant

______________

Coram: Sir Alan Huggins, V.-P., McMullin, V.-P. and Barker J.A.

__________

JUDGMENT

__________

Sir Alan Huggins, V.-P.:

1. The respondent Cargo-owners brought an action in the High Court against the appellant Ship-owners for damages arising out of rust damage to a consignment of steel plates. The Ship-owners sought a stay of that action on the ground that the relevant Bills of Lading contained a clause requiring adjudication of disputes in the District Court of Tokyo. The judge refused a stay and the Ship-owners now appeal.

2. The vessel in which the goods were shipped was the Griesheim, which has since been sold and renamed Vivacity. She was at the material time chartered to Trans Global Bulkers Ltd. by a charter-party in the form approved by the New York Produce Exchange and sub-chartered to the Nakamura Steamship Co. Ltd. She was then further sub-chartered to the Fukuyo Industries Corporation under a Baltime charter-party. Proceedings against her (an action in rem) were commenced in Hong Kong by virtue of her presence in Hong Kong waters, and she was arrested.

3. The cargo was consigned from Japanese ports to Europe and was discharged in Antwerp for final delivery in Switzerland, where it was surveyed. There were loading condition surveys of vessel and cargo in Japan. The cargo was surveyed on arrival in Basle and the vessel was again surveyed in Immingham. The carriage was performed under Bills of Lading executed on forms headed "Nakamura Steamship Co.Ltd.". The printed text included the words:

"In witness whereof, the undersigned, on behalf of Nakamura Steamship Co. Ltd. the Master and the Owner of the Vessel, has signed the number of Bill(s) of Lading stated above, all of this tenor and date, one of which being accomplished the others to stand void. "

The signatures were those of Mr. H. Matsuoka, who described himself as "Chief, Business Dept. II" of the Nakamura Steamship Co. Ltd. On the reverse of the bills were printed the detailed conditions, of which those material to this appeal were

"1.	(Definitions) The following words both on the face and back of this Bill of Lading having the meanings hereby assigned.
(a)	"Carrier" means the Nakamura Steamship Co. Ltd. including the servants, agents and the Master and the vessel and or her owners.
(b)	"Merchant" includes the shipper, consignor, consignee, owner or receiver of the Goods and also the holder of this Bill of lading.
(c)	"Goods" means the cargo described on the face hereof and if the cargo is packed into container(s) loaded on pallet(s) or unitized into similar article(s) of transport supplied or furnished by or on behalf of the Merchant, include such article(s) of transport as well.
2.	(Clause Paramount) (1) This Bill of Lading shall have effect subject to the provisions of the International Carriage of Goods by Sea Act 1957 of Japan, 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 August 25, 1924 compulsorily applies to this Bill of Lading, in which case it shall have effect subject to the provisions of such legislation. The said Act or legislation (hereinafter called the Hague Rules Legislation) shall be deemed to be incorporated herein. (2) If any provision of this Bill of Lading is held to be repugnant to any extent to the Hague Rules Legislation, such provision shall be null and void to that extent but no further.
3.	(Governing Law and Jurisdiction) The contract evidenced by or contained in this Bill of Lading shall be governed and construed by Japanese law except as may be otherwise provided for herein, and any action against the carrier thereunder shall be brought before the Tokyo District Court in Japan.
4.	(Limitation Statutes, Demise Clause) (1) ........ (2) If the Vessel is not owned by, or chartered by demise to the Carrier (as the case may be notwithstanding anything that appears to the contrary), this Bill of lading shall have effect only as a contract with the owner or demise charterer, as principal, as the case may be, made through the agency of the Carrier, who acts as agent only and shall be under no liability whatsoever in respect thereof. "

4. The judge declined to grant a stay on the ground that the ship-owners were not party to the Bills of Lading. In so doing he based his decision on only one of the three points which were taken before him. The same three points have been argued before us and it is desirable that we should state our conclusions on each of them.

5. The first two points relate to the issue whether the Ship-owners, who seek the stay, are in truth party to the Bills of lading and, therefore, entitled to rely on Clause 3. It is common ground that, whether or not the Ship-owners are party to the Bills of Lading, the Bills of Lading must be construed in accordance with the Japanese law. The litigants therefore placed before the judge evidence by experts in Japanese law, and his decision was based upon their opinions. It has been argued before us that, although his findings on the Japanese law must be given great weight, he did not assess the evidence as a matter of the credibility of the witnesses themselves, so that we are in as good a position as he was to decide which evidence was worthy of acceptance: Benmax v Austin Motor Company Limited 1955 1 All E.R. 326.

6. It has been most persuasively argued by Mr. Ribeiro that, although the judge in the end adopted the view of the majority of the experts, their view was based upon a fundamental error, namely that since Japan adopted the substance of the Hague Rules by enacting the Carriage of Goods by Sea Act 1957 (which I will abbreviate to C.O.G.S.A.) only one legal person can be the carrier under any bill of lading for the international carriage of goods by sea and that, where the vessel is being traded by a charterer, that one legal person must be the charterer. It is common ground that under Hong Kong law the Ship-owners would be party to the Bills of Lading with which we are concerned. Perhaps because that would be so, the Plaintiffs originally asserted in their writ a claim for damages for breach of contract against the Ship-owners, but it is not suggested that anything in the nature of an estoppel arises by reason of that assertion.

7. The starting point for Mr. Ribeiro's argument is that the or ordinary meaning of the Bills of Lading is that the charterers have signed on behalf of themselves and of the Ship-owners and that it is for the Cargo-owners to displace that plain meaning. He then submits that if and in so far as the Plaintiffs' experts say that the words of the Bills of Lading do not mean what they appear to mean the evidence is unsatisfactory both because it is inconsistent and because it can be shown to be ill-founded. Moreover, he contends that the view which commended itself to the judge would lead to commercial chaos - a result which, he says, would follow to an even greater extent from the Ship-owners' argument on the second point. Here he says merely that bills of lading are documents which are intended to have international effect and which, therefore, ought to be construed according to their apparent tenor and not by applying a rule of construction peculiar to one State. I am not sure that he went so far as to contend that such a peculiar rule should not be applied if it were clearly established: at least he submitted that there was strong ground for hesitation before concluding that such a rule had been established.

8. Since the Cargo-owners concede that the burden lies on them to show that the Japanese law would produce a result different from that which would be reached under English law, it is convenient to review their evidence first. All their opinions were set out in the unsatisfactory language and form thought appropriate for telex messages. For ease of reading I shall make minor changes to the language and reproduce them in both upper and lower case.

9. Mr. Nishiyama recognized that the words on the front of the Bills of Lading might prima facie appear to suggest that the Nakamura Steamship Co. Ltd. was signing as agent of the Ship-owners but said that those words must be "read in the context of there being only one carrier: carrier Nakamura cannot contract as an agent for unknown ship-owners as carrier, otherwise there would be two carriers". For his view that there could only be one carrier he relied first on the passage at p.69 of Professor Seiji Tanaka's Commentary on the Law Concerning Carriage of Goods by Sea (publishod in 1964):

"Charterer mentioned in paragraph 2 means a charterer who undertakes carriage of goods. Therefore, Art. 759 of the Commercial Code of Japan shall not apply in case of carriage of goods under a sub charter, and, as against the shipper, the charterer alone is liable to perform contracts of carriage, irrespective of whether the performance of the contract of carriage under the sub-charter is within the scope of the master's duties. In this case the owner, by performing his own obligation under the charter between the owner and the charterer, performs, as a sub-contractor of the charterer, the obligations under the sub charter between the charterer and the shipper. "

Secondly he relies on a passage at pp. 214/5 of Professor Teruhisa Ishii's Maritime Commercial LAW (7th Edition):

"COGSA - has departed from the conventional concept of shipowner's B/L and adopted the position that an enterprise which undertakes to carry goods is the carrier and a B/L is a carrier's B/L. Therefore, when a charterer enters into a sub charter with a shipper, as against the shipper, the charterer alone is liable to perform as carrier, all obligations under the contract of carriage with the shipper and acquires all rights thereunder, ......, no direct legal relationship arises between the owner end the shipper. "

From these authorities Mr. Nishiyama concludes that:

"	Nakamura only can be 'carrier' under Japanese CCGSA. Although scholars refer to 'sub-charter' I see no reason why their opinions should not apply equally where B/L is contract of carriage. "

He then adds:

"CCGSA (Article 2, paragraph 2) states:

'	In this law the carrier means either an owner, a lessee or a charterer of a ship who undertakes the carriage of goods in the preceding paragraph'.

(For your information, preceding paragraph provides for carriage to or from foreign port: which we understand is the case here (ie international carriage of goods not, coastal trade). Rule for construction of documents requires owner, lessee and charterer to be read separately with effect that only one of these parties can be carrier. )"

10. Mr. Ninomaya considered it possible to say that in spite of the terms of the Bills of Lading they "were not signed on behalf of the owner and the owner [was] not the carrier". His reasoning was as follows:

If the owner is also the carrier, this indicates that the claimant shall pursue not only Nakamura but also the owner at the same time under B/Ls claim. And also it should be appeared in the B/Ls how extent the 2 carriers take responsibility for contract of carriage. Jointly and severally or half each: Taking account of such things we opine that the owner is not the carrier and/or contracting party to Nakamura B/Ls. "

11. The two foregoing opinions are conveniently summarized in the opinion of Mr. Tameyuki Hosoi when he says:

Looking at B/L clauses, in my view both clause 1(A) & the words on the face that B/L is signed on behalf of Nakamura master & owners, must be considered in light of the foregoing provisions favouring there being one 'carrier'. Clause 1(A) is vague and in my view merely indicates those parties who might be 'carrier' (ie class of possible 'carrier') although words on face are not vague, I do not believe that that can be interpreted literally since this could lead to there being two 'carriers' and as I have already indicated above, there cannot be two 'carriers' in a B/L governed by Japanese CCGSA. "

12. Mr. Ikuya Fujii started his first opinion with the bald assertion that the Bills of Lading were signed by a representative of Nakamura Steamship Co. Ltd., and not for and on behalf of the master of the vessel". That assertion is attacked as being a manifestly untrue premiss. When he was informed of Mr. Kimura's objection, he commented:

"In my view the only reasonable interpretation of the contract is that Nakamura and only Nakamura is the 'carrier.' Mr. Kimura's comments must be read together with

(A)	The definition of 'carrier' in clause 1(A) on the reverse side of the B/L form, to the effect that the 'carrier' means 'the Nakamura Steamship Co. Ltd. including the servants, agents and the master and the vessel and or her owners,
(B)	The demise clause (clause 4(2)), which uses the term 'carrier' as well as the term 'owners,' and
(C)	The two paragraphs immediately below the words 'Nakamura Steamship Co., Ltd. Bill of Lading,' on the face of the B/L in which the term 'carrier' appears twice.
(A)	First, the demise clause uses the term 'carrier,' which according to clause 1(A) may include the 'owners.' If the owner or owners are included in the definition of the term 'carrier' then the demise clause would mean ...' if the vessel is not owned by .... her owner ....' and that the contract is 'made through the agency of the owner, who acts as agent only and shall be under no liability whatsoever in respect thereof.' That clearly makes no sense. The demise clause only makes sense if the term 'carrier' refers only to Nakamura. However, under the Japanese law such a demise clause is invalid since, on the one hand, the carrier may not disclaim its liability in such a manner and, on the other hand, a non-contracting party, such as the shipowners in this case cannot claim the benefit of the B/L contract. By the same token, the words on the face of the Bills of Lading 'on behalf of Nakamura Steamship Co., the master and the owner of the vessel' are equally invalid to fulfil either of these purposes.
(B)	Second, nowhere in the contract does it clearly state that there are two carriers acting as principals. There are no words that 'Nakamura and the owners of the vessel jointly undertake the carriage of the goods and shall be jointly and severally liable for damage under Japanese C.O.G.S.A.' The B/L was issued by Nakamura whose name appears at the top and above the signature line at the bottom. The name of the owner of the vessel does not appear anywhere on the B/L. Therefore under the facts and under the strong presumption under the Japanese Law that the contract is with the person who issued the B/L, there is no question that Nakamura and Nakamura only is the carrier in this case.
(C)	Finally, the B/L is a contract of adhesion. . It is drafted vaguely so that the shipowner can attempt to claim B/L and C.O.G.S.A. benefits if he wants or deny that he has liability as a carrier under the B/L if he doesn't want. However a contract of adhesion is construed against the drafter. In this case the shipowner authorized the charterer under the Article 8 of the head C/P to issue B/L's and knew or had the opportunity to learn the contents of the charterer's B/L forms. Therefore the C/P must be construed against the shipowner. Accordingly, the B/L holder can choose the construction most beneficial to it, which in this case is that the carrier is the charterer and not the owner. That is, the B/L holder, not the shipowner, gets the benefit of a vaguely worded contract. "

13. The only other evidence was Mr. Hall's hearsay report of the opinion of Mr. Akira Nakada in the case of the "Fortune Venture" to the effect that

"	the Courts in Japan do not give effect to Demise Clauses in cases where Bills of Lading on Charterers' form are issued by Charterers. This means that Owners are not parties to Bill of Lading contracts made on Charterers' form and issued by Charterers. "

Mr. Hall went on to say in his affidavit that he had been told by a partner of his that in another case he had been advised

"	that the Nakamura Bill of lading would be interpreted as a Charterers' Bill by the Japanese Courts. "

By a "Charterers' Bill" I think he probably meant "a Charterers' Bill and only a Charterers' Bill", but in any event such hearsay and double hearsay opinions carry little or no weight and I ignore what Mr. Hall has said on this subject.

14. Mr. Ribeiro argues that all the other opinions are based upon the fallacy that, as there cannot be two carriers under a bill of lading for the purposes of the Japanese C.O.G.S.A., there cannot be two carriers under the bill for other purposes. This necessary step in the reasoning of the Cargo-owners' four experts is taker by them to be axiomatic. Mr. Kimura, the Ship-owners' expert, contends that it is not axiomatic and he sees no valid reason why there should not be two carriers who are party to these Bills of Lading for the purpose of ascertaining general contractual liability. He says in particular that Article 2(2), a definition provision for the interpretation of the C.O.G.S.A., merely indicates who can be a carrier and does not say that there must be one and only one carrier under every bill of lading to which the C.O.G.S.A. applies. (That the C.O.G.S.A. applies to these Bills of Lading is not, of course, in dispute). Indeed, several of the Cargo-owners' experts agree that Article 2(2) indicates who is "eligible" as a carrier and does not purport to identify the carrier. To a lawyer trained in the English tradition Mr. Kimura's objection has great attraction, but it may be that the Japanese law does not maintain the same distinction between the interpretation of statute and the interpretation of documents to which a statute may apply. The Cargo-owners' experts were advised of his objection but saw nothing in it to drive them from the opinion which they had expressed.

15. Mr. Justice Power was not overawed by the number of experts arrayed to defend the Cargo-owners against the application for a stay and we cannot say that he was necessarily wrong in concluding that Mr. Kimura's objection could be explained away under Japanese law. Mr. Ribeiro submits that by virtue of Article 704 a time charterer is "treated as in the position of a demise charterer" and has (like a demise charterer himself) the same rights and duties as the owner, but that those rights and duties co-exist with the rights and duties of the owner. This is the crux of the matter. As I understand the law, a demise charterer does not have "the same rights and duties as the owner" but has all the rights and duties which the owner formally had other than his reversionary rights: for most purposes he stands in the shoes of the owner for the duration of the charter party. There cannot be two persons with the same, conflicting, rights and duties. Hence it is really Article 704 which makes it impossible for there to be two carriers for the purposes of the C.O.G.S.A.

16. For these reasons I see no reason to differ from Mr. Justice Power when he decided that the Ship-owners were not party to the Bills of Lading and cannot rely on Clause 3 thereof to seek a stay of the proceedings.

17. The second point upon which we are asked to give a decision concerns an argument advanced by the Plaintiffs to support their contention that the Ship-owners are not party to the Bills of Lading. It concerns the effect of non-compliance with Article 7(6) of the C.O.G.S.A. The relevant words in that article are:

"	The Bills of lading shall have the entry of the following particulars ...... and shall be signed by the carrier, master or agent of the carrier or shall have the written names with their seal affixed thereon. .............................. 6. The full name or trade name of the carrier."

That there was such a failure to comply with that provision (assuming that the Ship-owners are, as they allege, party to the Bills of Lading) is manifest: the only carrier actually named is Nakamura Steamship Co. Ltd. Its name appears at the head of the document and under the signature. The Ship-owners therefore have to rely upon the argument that, in spite of the clear language of Article 7(6), it is a sufficient compliance if they are readily identifiable as an intended party to the documents and that, as the documents were signed "on behalf of Nakamura Steamship Co. Ltd. the Master and the Owner of the Vessel", that is enough. Mr. Ribeiro submits that a stricter interpretation is unnecessary and would in some cases avoid the document to the prejudice of the shipper and persons to whom the goods were transferred. This is the second point in his argument at which Mr. Ribeiro suggests that the possibility of commercial chaos is involved. He refers to Carver on The Carriage of Goods by sea (13th ed.) at p. 365 where the comparable English law is stated and he submits that, as the Japanese statute was intended to attain the same object as the English statute, it should be interpreted in the same way. It follows, he says, that Article 7 merely entitles the shipper to demand a bill of lading in the prescribed form but does not invalidate a bill of lading which does not comply or mean that, where one person claiming to be a carrier is named and another is not named, only the named carrier is bound. He says that Article 6 and Article 7 are to be read together. Article 6 is in these terms:

The carrier, master or agent of the carrier shall, on demand of the shipper, issue to the shipper a bill of lading in one or more copies showing that the shipment of the goods has been made (hereinafter referred to as a 'shipped bill of lading'), without delay after loading the goods on the ship. Even before the goods are loaded, the carrier shall, after receipt of the goods and on demand of the shipper, issue a bill of lading in one or more copies showing that the receipt of the goods has been made (hereinafter referred to as a 'received bill of lading').

Mr. Ribeiro therefore submits that the opinion of Mr. Kimura is clearly right when he says:

Idea that carrier's name must be stated in B/L is to ensure shipper/consignee's position in identifying carrier. Therefore carrier is not allowed to refuse to identify himself on face of B/L. This provision is however not intended to introduce any further effect. In particular, the provision should not be viewed to exclude a person, whose name is not specified in B/L, from being carrier. Otherwise the provision will be utilised to justify a carrier to avoid liability by choosing to omit his name from B/L. Therefore, I consider that contract of carriage and parties thereto are not affected per se by non-compliance with Art. 7(6).

Insofar as it can be told from B/L on whose behalf B/L is issued, such' person should be a carrier. "

Mr. Ribeiro contends that the contrary view not only produces unsatisfactory consequences but is based upon demonstrably bad authority. In the first place the Plaintiffs' experts did not initially apply their minds to the abstract question raised by Mr. Ribeiro but were content to say that the omission of the Ship-owners' name from these Bills of Lading led to a presumption that only the charterer, which signed them with its own name, was a carrier: see Mr. Nishiyama at p. 390 of the record, Mr. Ninomiya at p. 393 and Mr. Hosoi at p. 396. However, they subsequently expanded upon their initial opinions and what they then said is fully and fairly indicated in Mr. Kimura's further opinion:

"I am advised to make comment on following propositions

.............................................................................................

1. Omission of name of carrier renders B/L invalid.

..................................................................................

..................................................................................

I do not agree with any of above propositions for following reasons.

A. Re First Proposition

Three scholars' books are introduced to support their view but I do not agree with their interpretation of each book.

(1) Prof. T Ishii "Maritime Commerce Law" page 273. Prof. Ishii says 'It is shared by majority of scholars that omission of some items as set out in Art. 7 of COGSA does not render B/L invalid unless such omission does affect essence of B/L (or in more correct interpretation in my view, destroy essence of B/L). Insofar as B/L can identify particulars of goods, carrier and pert of delivery, such B/L is not invalid'. Mr. Ninomiya says in his telex that Prof. Ishii opines that particulars relating to identity of carrier .... are required as minimum entries to B/L. If Mr. Ninomiya uses the words 'particulars' relating to identity of carrier' with a view to specifically indicating carrier's name, I 'do not think it is a correct representation of Prof. Ishii's view.

In my interpretation, what Prof. Ishii intends to say would be that B/L should tell who is carrier and insofar as B/L enables shipper/consignee/holder to identify carrier, minimum requirement for its validity would be satisfied, even if such carrier's name is not specified. In any event, if Prof. Ishii does not go so far as to say so in his book, then I would at least say that Prof. Ishii does not give any view on this question.

Although Prof, Ishii expressly says that omission of such items' of Art. 7 of COGSA as (2) 'volume or weight of the goods carried, or the number of package or pieces and the marks of the goods carried', and (9) 'Port of Discharge' makes B/L invalid he does not express that omission of carrier's name also makes B/L invalid. Furthermore, in relation to omission of volume or weight of the goods Prof. Ishii goes on to say 'In case of insubstitutable goods omission of their volume or weight does not make B/L invalid provided volume or weight can be identified by custom or common sense of trade'. What is deducible from his comment is that a question of whether B/L is made invalid should not be viewed by way of categorical consideration of which item(s) is omitted but should be judged from a view point of whether such omission destroys the essence of B/L.

In my view, the words 'signed on behalf of ... the owners', is combination with the name of the vessel may well enable cargo interests to find the owner's identity. Art. 7 of COGSA is principally intended to empower shipper to demand issue of B/L having full description of required particulars (this is supported by Prof. S. Tanaka as will be discussed below). In case that B/L is issued in non-compliance with such requirements, such B/L should be still valid insofar as essence of B/L is satisfied. Otherwise, it would be in the majority of cases the cargo interest who suffer prejudice from invalidity of B/L.

(2) Prof. S. Komachiya 'Opinion on unification of Bills of Lading', page 344.

The gist of Prof. Komachiya's view would be same as that of Prof. Ishii. I again question Mr. Ninomiya's interpretation which reads 'These particulars should be particularised in the Bill of Lading. If they are not, the Bill of Lading is invalid', if the words 'these particulars' are intended to refer to 'name of carrier'.

Likewise in case of Prof. Ishii, although Prof. Komachiya expressly says that omission of items (1) and (2) of Art. 7 of COGSA makes B/L invalid, he does not express that omission of carrier's name also makes B/L invalid. If Prof. Komachiya had thought that omission of carrier's name made B/L invalid, he, I presume, would have said so with express words.

In my interpretation, Prof. Tanaka considers that omission of carrier's name does not render B/L invalid. Prof. Tanaka says 'If the B/L does not state carrier's name and furthermore B/L does not state that B/L was issued through agency, then a person who signed B/L should take responsibility for the B/L contract (Note: Mr. Ninomiya's telex omitted above underlined passage. ) Analysis of above passage would lead to the conclusion that if B/L does not state carrier's name but can tell that B/L was issued through agency, the principal, whose name is not specified in B/L though, shall be carrier.

Prof. Tanaka's other book 'Discussion on Maritime Commerce Law' published in 1970, would reinforce my argument.

He says at page 388 'Since Art.7 of COGSA is intended to enumerate particulars which a shipper is entitled to demand to appear in B/L, omission of some particulars does not render B/L invalid insofar as essential particulars are entered therein. Only such B/L as is deemed not to be B/L from business sense is invalid'. Omission of discharging port identity of goods and their quantum is given by Prof. Tanaka as examples where B/L would be nullified. Again he does not, express that omission of carrier's name makes B/L invalid."

18. I find that opinion most persuasive and had the Cargo-owners not succeeded on their first argument I think we would have been forced to allow the appeal on this point.

19. Finally I turn to the application of the principles stated in The Eleftheria 1970 P. 94 in case it should be held hereafter that the appellant Ship-owners are entitled to rely upon Clause 3 of the Bills of Lading. The correctness and applicability of those principles are not in question. As the trial judge did not purport to exercise his discretion, we must approach the matter without the benefit of his opinion.

20. It would be for the Plaintiffs to show good cause why, they should not be bound by their agreement to litigate in Japan, an issue which must be decided after taking account of all the circumstances of the case. The only ground for litigating in Hong Kong is that the vessel was arrested here: no advantage can result to either party from a trial in our courts in preference to a trial elsewhere. However, the Cargo-owners' principal contention is that the Ship-owners, in trying to stay the present proceedings, are really seeking to avoid a trial at all. The basis of that contention is that there seems to be little doubt that if the cause is tried in Japan in accordance with Clause 3 the Cargo-owners will be met by a plea of limitation. The Ship-owners submit that if the claim is time-barred the blame falls squarely upon the Cargo-owners themselves, for they could have taken out a protective writ. There was some argument whether that course was open, but I am prepared to assume that it was. The Cargo-owners' answer is that they acted reasonably in not adopting such a course. This answer is based on their understanding on three points. First they say that, following expert advice on Japanese law given to their solicitors in a previous case, they took the view that they had no cause of, action in contract, because they were not party to the Bills of Lading. As to that Mr. Ribeiro contends that it was not reasonable to act on advice given in relation to bills of lading which, although in similar form, may not have been identical. The solicitors thought they were identical and I think they cannot be criticised adversely for not having sought confirmation of the previous advice, particularly as their experience showed that it was sometimes difficult to obtain legal opinions from Japan. Secondly, the Cargo-ownere advised that, as they were not party to the Bills of Lading, the Japanese courts did not have jurisdiction. Moreover, they indicated to the Ship-owners that they intended to sue elsewhere than in Japan and the Ship-owners never questioned their right to sue elsewhere and gave no hint that they would rely upon Clause 2. On this point Mr. Lyell distinguishes The Nedlloyd Schie 1983 H.K.L.R. 17, where the defendants had made it clear from the outset that they would rely upon the jurisdiction clause. I think Mr. Lyell is right and again I accept the argument on behalf of the Cargo-owners. When one comes to the third point, whether the Cargo-owners can establish that Japan is not a convenient jurisdiction, the matter becomes less clear. Mr. Lyell submits that the Ship-owners cannot seriously have desired a trial in Japan, because when they executed a time charter in favour of Trans Global they stipulated for arbitration in London under English law. The answer to that is that when contracting a bill of lading the carrier is often obliged to give way to the wishes of the cargo interests as to the jurisdiction for the settlement of disputes, and here the cargo underwriters are resident in Japan, as are the shippers and the charterers and sub-charterers. It is then argued by Mr. Ribeiro that whilst no prospective witnesses are resident in Hong Kong there will be witnesses resident in Japan who will speak to the condition of the ship and cargo at the time of loading. He says that the fact that (on the assumption that Clause 3 applies) the dispute would be decided by Japanese law makes it desirable to have the case tried in Japan and he contends that the greater expense of litigation in Japan would be offset by the fact that the court would require no expert evidence of that law. On the other side it is suggested that much of the documentary evidence would be in English and would require translation into Japanese if the trial were in Japan, a factor which Mr. Ribeiro submits is of less significance than the Cargo-owners seek to put upon it. Then it is suggested that more witnesses would be likely to speak English than would be likely to speak Japanese.

21. I decline to express any view on the suggestion that the Japanese court would not adjudicate promptly, but, taking all the other matters into consideration, I think the Cargo-owners have discharged the onus of showing that the court's discretion should be exercised in favour of not granting a stay.

McMullin, V.-P.:

22. I agree and I do not wish to add anything further.

Barker, J.A.:

23. I agree and there is nothing I can usefully add.

24th August 1984