Mitsui & Co Ltd v. Gold Star Line Ltd
Read the full judgment text of CACV 43/1974 on BabelCite. This Court of Appeal judgment.
1. The Plaintiffs (the consignees) sued the ship-owners and the charterers for damages under two bills of lading. The bills of lading were signed by the charterers, who sought to take a preliminary point that the claim against them was misconceived. As a result a consent order was made that
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IN THE SUPREME COURT OF HONG KONG (APPELLATE JURISDICTION) CIVIL APPEAL NO. 43 OF 1974 (On appeal from A.J. 130/73) -----------------
----------------- Coram: Huggins, McMullin & Pickering, JJ. Date of Judgment: 30th December 1974. ----------------- JUDGMENT ----------------- Huggins, J.: 1. The Plaintiffs (the consignees) sued the ship-owners and the charterers for damages under two bills of lading. The bills of lading were signed by the charterers, who sought to take a preliminary point that the claim against them was misconceived. As a result a consent order was made that
That was an unfortunate order for two reasons. First, it made an assumption which prima facie was contrary to the true fact, namely that the charterers purported to sign as principals and not as agents for the ship-owners. Secondly, it has enabled Mr. Ching on behalf of the Plaintiffs to contend that the point raised in paras. 7, 8, 9 and 10 of the Defence of the second Defendants was more limited than the order itself appeared to suggest. Those paragraphs read:
(The reference to "Clause 18" should have read "Clause 17"). It was contended by Mr. Ching that the words of para. 10 precluded the second Defendants from relying, upon the trial of the preliminary issue, on any argument that they acted as agents otherwise than "in the premises" and in particular from relying upon the argument that the form of signature itself showed that they were acting as agents and intended to incur no liability as a contracting party. Mr. Mills-Owens, for the second Defendants, accepted in the court below that the only issue before the judge was
and the judge proceeded to consider this narrow issue. It was common ground that if Clause 17 was valid the bills of lading took effect "only as a contract with the owner . . . . as principal made through the agency of [the second Defendants] who act as agents only and shall be under no liability whatsoever in respect there on". The Plaintiffs' submission was that Clause 17 could not stand along with Clauses 2 and 3, the material parts of which are:
The country of shipment was South Africa and it was not proved that the Hague Rules as there enacted were otherwise than identical with the Rules as enacted in Hong Kong. The learned judge held in favour of the second Defendants and dismissed the action. The Plaintiffs now appeal. Although the notice of appeal asked that the decision of the trial judge be reversed, it is conceded that even if the appeal were to succeed we ought not to enter judgment in the action for the Plaintiffs. 2. The essense of Mr. Ching's argument before us has been that the second Defendants are "carriers" within the definition in Article 1 para. 2 of the Carriage by Sea under Bills of Lading Rules, which reads:
He goes on to rely on Article 3 para. 8 which reads in part:
Thus, the argument runs, Clause 17 is null and void and of no effect because it relieves the second Defendants from such liability. 3. I must emphasise that although, for the ourpose of deciding the preliminary issue, it was necessary to assume that the second Defendants were a contracting party, it has never been conceded generally that they were a contracting party. I say it was necessary to make this assumption for the purpose of the preliminary issue because, unless they were a contracting party, they could not be bound by Clause 17 an way and it would have mattered not whether that clause was null and void or what it meant. The difficulty is that once one makes the assumption that the second Defendants are a contracting party it follows that they must be caught by the definition of "carrier", for as a contracting party they "[entered] into a contract of carriage with a shipper". It was argued that even an agent who signs a contract of carriage for and on behalf of his principal "enters into a contract of carriage" for the purpose of the definition. That I am quite unable to accept: he merely assents to a contract entered into between his principal and the other party. It makes no difference whether the actual principal is disclosed or not: Lester v. Balfour Williamson Merchant Shippers Limited 1953 2 Q.B. 168. 4. The rest of Mr. Ching's argument is that Clause 2, the "Clause Paramount", refers to the Hague Rules "as enacted in Hong Kong" and he submits that one must look solely at the Carriage of Goods by Sea under Bills of Lading Rules, which contain no limitation to bills of lading relating to the carriage of goods "from any port in the Colony". Mr. Mills-Owens, on the other hand, submits that the Hague Rules as enacted in Hong Kong do include such a limitation, because that limitation is to be found in s.2 of the Carriage of Goods by Sea Ordinance, which provides:
At first sight that appears to be a satisfactory answer, but Mr. Ching points out that such an interpretation would make nonsense of Clause 2: the clause would first provide that "the Hague Rules . . . . as enacted shall apply to this contract" but the Rules as enacted could not apply because as applied in Hong Kong they do not have effect in relation to and in connection with the carriage of goods from a port outside the Colony, the only sort of carriage contemplated by the bills of lading. Therefore, he says, the words "the Rules as enacted in Hong Kong" in Clause 2 must have been intended to mean the Hague Rules as enacted in the Carriage by Sea under Bills of Lading Rules and not the Hague Rules as enacted in those Rules but as applied to Hong Kong by s.2 of the Ordinance. 5. I confess that if the words "as enacted in Hong Kong" had to being interpreted in vacuo I would have preferred Mr. Mills-Owens's approach: I do not see why the Hague Rules should not be enacted partly in rules or partly in the principal Ordinance. However, I am forced to the conclusion that that interpretation makes nonsense of the clause. Where does that lead us? If the Carriage by Sea under Bills of Lading Rules apply to these contracts, Article 3 para. 8(1) applies to them. On the assumption that we have been forced to make, Clause 17, it is said, purports to relieve the second Defendants from liability for loss or damage in a manner proscribed by that sub-paragraph. Mr. Mills-Owens says that that is not so. His case is that Clause 17 was not one "relieving the carrier" but one providing that bills of lading issued by the second Defendants, who did not own the vessel and had not chartered her by demise, should take effect as though the second Defendants were not a party at all: if they were never a party they never incurred any liability from which they could be relieved. In other words they are by the bills of lading deemed not to have been a party. As I understand it, the argument in reply to that is that however the result has been achieved the second Defendants, who we are having to assume were in fact a party to the contract and who would, but for Clause 17, be liable, are relieved from that liability. 6. Although the point is not without difficulty it seems to me that a time charterer who signs a bill of lading containing a demise clause manifests an intention not to assume any personal liability and therefore incurs no liability against which he could be relieved. It is significant that the text books to which we have been referred nowhere suggest that any conflict is likely to arise between such a clause and the Hague Rules. It follows that in my view the learned judge came to the right conclusion and I would dismiss this appeal. 30th December 1974. |