Ngei Cheong Hong International Ltd v. Topocean Consolidation Service Ltd and Others

HCCL 24/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO. 24 OF 2003

(Formerly HCA No.3862 of 2001)

-------------------------

BETWEEN

----------------------

Before : Hon Stone J in Court

Dates of Hearing : 18, 19, 20 and 22 July 2005

Date of Judgment : 3 August 2005

-------------------------

J U D G M E N T

-------------------------

The action

1.This is an action by the plaintiff, a Hong Kong company, against the 1^st defendant, another Hong Kong company, for damages in the sum of US$91,175.08 arising from the alleged breach of the obligations of the 1^st defendant under a contract of carriage, evidenced by two bills of lading issued by the 1^st defendant, of five containers containing luggage and bags which the plaintiff shipped from Xiamen, PRC to New York for the purpose of onsale to a New York buyer.

2.In terms of the broad shape of this case, two points may usefully be highlighted at the outset : first, that whilst three other defendants have been named in the writ, none of these defendants have been served out of the jurisdiction, and accordingly have taken no part in this case; and second, that the counterclaim of the 1^st defendant appearing on the face of the pleadings (at paragraph 15 of the Re-Amended Defence and Counterclaim) is no longer ‘live’; on 29 November 2002 Master Wee, sitting in Chambers, entered summary judgment on the counterclaim in the sum of HK$371,996.00 against the plaintiff in favour of the 1^st defendant.

3.It is unusual for the position to arise whereby the claim and counterclaim are adjudicated within a 3-year span by different levels of court – the record indicates that this case was transferred to the Commercial List on 11 April 2003.  Be that as it may; for present purposes I note that the position adopted by the 1^st defendant at the earlier hearing of this counterclaim is relevant in terms of a submission which now has been ventilated at this trial of the head action.

The factual background

4.As to the objectively ascertainable facts, with one significant exception there is little dispute as to the sequence of primary events, albeit there is a strong difference of view as to the legal consequences arising from the factual matrix in this case.

5.The plaintiff, Ngei Cheong Hong International Limited (‘Ngei Chong’) is an Hong Kong exporter.  The evidence is that since 1988 it has been manufacturing and selling, amongst other things, jute bags and luggage made of PVC material.  These goods are manufactured at the plaintiff’s factory in Fujian Province, which manufacturing it carries on, inter alia, under the name of Chinese Prosperous Development Limited.

6.In June 2000 the plaintiff entered into sales confirmations for the sale of such goods to an American buyer, Alta USA Inc. (‘Alta’), whose business address was in Flushing, New York.  The buyer’s purchasing manager was a Miss Jenny Zhu, who wished to buy these goods from the plaintiff for the purpose of onsale to her customers in America.

7.The actual details of these sales confirmations do not greatly matter, although they have been fully set out in the witness statement of Madam Kwok Kam Wai, who describes herself as the ‘general manageress and an ex-director’ of Ngei Hong; Madam Kwok is also the wife of the owner of Ngei Cheong, Mr Lam Chong, who also gave evidence during this trial.

8.In the event, in order to ship the goods thus ordered by Alta, and to arrange for their shipment from Xiamen to New York, the plaintiff needed to engage the services of a freight forwarder.

9.Given that the 1^st defendant, Top Ocean Consolidation Service Limited (‘Top Ocean’) maintained an office in Xiamen, and in light of the fact that since March 2000 the plaintiff had been using the services of Top Ocean for the shipment of its goods to the USA, it was Top Ocean which again was chosen for this particular job.

10.The 1^st defendant is in fact part of an international ‘Top Ocean Group’, with offices not only in Hong Kong, but also in New York and Los Angeles.  Technically Top Ocean is that which is referred to in the trade as an ‘NVOCC’, that is, a ‘non-vessel-operating common carrier’.

11.The goods the subject of this case were loaded by the plaintiff in five containers which were loaded in Xiamen on board the vessel “Mare Africum” for the voyage from China to New York.

12.Two bills of lading were issued to the plaintiff by Top Ocean in Hong Kong covering the shipment of these five containers: these were bill number TCSXMN010178 (‘B/L 178’), which was referable to the shipment of three of those containers, and bill number TCSXMN010085 (‘B/L 185’), which was referable to the remaining two containers relevant to this case.

13.Each of these bills of lading, which were dated 22 October 2000, named the Consignee as ‘To Order’ and the Notify Party as ‘Alta USA Inc.’.  The port of loading was Xiamen and the place of delivery specified as New York.  The box marked ‘For Delivery of Goods’ specified that application be made to ‘Topocean Consolidation (NYC) Inc.’, with an address in South Franklin Avenue, Valley Stream, New York.

Fate of the five containers

14.That which thereafter occurred forms the subject-matter of this dispute.

15.The “Mare Africum” arrived at the terminal at Journal Square Plaza, Jersey City, New York on or about 20 November 2000.  Topocean (New York) was contacted about the arrival of the vessel, and in turn Topocean contacted the Notify Party, Alta.

16.On 24 November 2000 Alta provided copies of the shipping documents prepared by the plaintiff, and the packing lists, for the purpose of US Customs’ clearance and payment of duty upon two containers.  Alta was also responsible for the freight referable to these two containers, which sum duly was passed on by Topocean to Oceanic Bridge International Inc., the agent for the actual ocean carrier.

17.However, for reasons which are not altogether clear, save that simply there was an error on the part of Topocean, the two containers which now had cleared US Customs were released to Alta absent the tendering by Alta of the relevant bill of lading.  Alta had provided no bank guarantee in lieu of the appropriate bill, which would only have been sent to it by the plaintiff upon Alta’s payment of the price of the goods therein, and on the basis of the evidence of Miss Grace Yeh, the shipping clerk of Topocean New York who was responsible for the misdelivery, and whom at that time was relatively inexperienced, it seems that she had been labouring under the misapprehension that Alta effectively had a month’s post-delivery credit within which to produce the relevant bill of lading.  In fact, Alta never did so, because it never paid the plaintiff for these goods, and thus never was put into possession of the necessary bill.

18.In any event, the two containers as were released were referable to B/L 178, under which three containers had been shipped, the third container so shipped under this bill remaining uncollected.

19.This latter container, together with the two containers the subject of shipment under B/L 185, never were claimed by Alta, nor indeed by the plaintiff, and remained on the dockside until 22 December 2000, when they were removed from their place of storage and taken to the ‘General Order’ warehouse, whereafter the content of these three unclaimed containers was auctioned, on 28 June 2001, by the relevant US authority : the price obtained at auction for these goods was US$52,300.00, this money being used to defray the storage charges accumulated during the intervening period, together with the outstanding freight payable to the ocean carrier in respect of these three containers for the voyage from Xiamen to the United States.

20.Thus, out of the five containers so shipped by the plaintiff through the medium of Topocean, two were misdelivered absent production of the bill of lading, and the remaining three went unclaimed, with the contents ultimately being disposed of by the US authorities.  Accordingly, it is against this factual background that the plaintiff shipper pursues its present claim against the 1^st defendant.

Claim 1 : the two misdelivered containers

21.Prima facie, if a carrier delivers goods to a Notify Party absent production of the referable bill of lading, it is liable for the damage to the shipper thus ensuing.

22.Miss Chan, who appears for the 1^st defendant in this case, recognizes the force of this proposition, but says first, that in this case the carrier is not the 1^st defendant, Topocean Hong Kong, which is the only entity now pursued in this case, and second, that if this be wrong, she takes issue with the quantum of damage put forward by the plaintiff with reference to the goods within these containers.

23.I can, I think, dispose of the ‘identity’ point in short order.  It has no intrinsic merit.  It is common ground that the relevant bill was issued to the plaintiff by the 1^st defendant in Hong Kong, and negotiations for settlement of this claim took place in Hong Kong – in fact, there were two meetings between the plaintiff and Topocean executives in Hong Kong on this issue, wherein offers were made to settle this element of the case, albeit at a lower sum than was demanded by the plaintiff.

24.Although controversy as to the identity of the carrier features on the pleadings, curiously the pleaded stance has not been consistent.  The original position was that the entity whose bill this was was not the 1^st defendant, but Topocean New York.  However, this was subject to amendment to assert that the 1^st defendant had signed for and on behalf of Topocean Los Angeles.  It appears, at least from the evidence of Mr Rankie Chan, that amendment in these terms was motivated in part by the realization, notwithstanding the pleaded case, that at the material time that Topocean New York was not licensed to issue bills of lading.

25.In any event, on behalf of the 1^st defendant Miss Chan now insists that this is Top Ocean Los Angeles bill of lading, although she accepts that the bill does not say so in terms .  The bill bears the heading of ‘TOPOCEAN Consolidation Service Inc.’ – now identified to be the Los Angeles entity within this Group, although how the plaintiff possibly could have divined this fact is not vouchsafed – whilst at the bottom of the bill, the space for the signature bears the printed legend ‘TOPOCEAN Consolidation Service Inc.’, with immediately thereunder appearing the further legend ‘As Agent for the Carrier’.  Superimposed on top of the printed document is a chop which reads ‘For and on behalf of TOPOCEAN CONSOLIDATION SERVICE LIMITED’, with therein a signature.

26.Miss Chan says that this denotes that the 1^st defendant, whose chop this is, was signing as agent for the carrier, now said to be Topocean Los Angeles, whilst Mr Kerr, who appears of the plaintiff, argues that the bill clearly has been signed by the 1^st defendant, and that in the circumstances and in case of doubt the bill should be construed contra proferentem, that the printed legend ‘As Agent for the Carrier’ should be read as referring to the printed name immediately above, and that on a straightforward interpretation the 1^st defendant clearly is the carrier.

27.I decline the invitation to hold that the 1^st defendant is wrongly impleaded, and I decline to accept the 1^st defendant’s ‘identity of carrier’ defence.

28.The position is most unsatisfactory on the face of the bill, and if necessary I uphold the contention that having signed it the 1^st defendant must be bound thereunder, given the ambivalence on the face of the bill and in the absence of cogent evidence of agency on its part.  In this regard I unhesitatingly reject the pleaded position that this is a Topocean Los Angeles bill, and that liability, if established, should enure to that entity.  On any basis Topocean Los Angeles had nothing whatever to do with this case, and on the established matrix of facts was not involved in any way.

29.I have concluded that the case as now put forward on this issue is an arid technical argument for which there is no evidential basis.  As Mr Kerr observed, if indeed the 1^st defendant was doing no more than acting qua agent it should at least be able to produce some evidence of that fact other than a bare assertion from a non-managerial employee.  I agree.  One of the striking features of this case is that no senior executive or director of Topocean was called to give evidence in this case, notwithstanding that on the evidence it was abundantly clear that there had been involvement at senior managerial level during the attempts which have been made to compromise this dispute.

30.However, there is another reason for rejecting the 1^st defendant’s claim that it was acting as agent for the Los Angeles entity, and it is an aspect of the case to which I made brief reference at the outset.

31.As earlier rehearsed, the 1^st defendant had obtained judgment on its counterclaim pursuant to a hearing before Master Wee in November 2002.  Suit on that counterclaim was based on invoices issued by the 1^st defendant to the plaintiff for, inter alia, ocean freight “by virtue of services rendered by the defendant at the plaintiff’s request”, and Mr Kerr has confirmed that the freight element of this claim was based upon shipment under bills of lading issued in like terms as the bills in the instant case. 

32.In other words, the situation which emerges is that when the 1^st defendant sues, as it now has successfully under its counterclaim, for monies owed by the plaintiff, it adopts the persona of carrier under the bills invoked in support of the claim, but when it is sued upon bills in like form, it affects the contrary position of agent for a foreign principal.  Indeed, in the argument before Master Wee the 1^st defendant had resisted the plaintiff’s attempt to set-off the counterclaim sum against its own claim for damages, and thus to obtain a stay of execution, by reference to the well-established principle that freight cannot be the subject of set-off against any claim otherwise arising in terms of carriage of goods, an argument that can only have been mounted by the 1^st defendant qua carrier.

33.Accordingly, I have no difficulty in holding that, having asserted the carrier’s right to deny a set-off in terms of freight in instances of carriage under similar bills of lading, the 1^st defendant now is estopped from asserting that it is not the carrier in this case.

34.It follows from the foregoing, with the dismissal of the ‘identity of carrier’ defence, that the sole element remaining for consideration in terms of the plaintiff’s claim arising from the misdelivery of the two containers is that of quantum.

35.As to the quantum of loss, the plaintiff says that this aspect of the claim is worth US$41,952,90, which is the figure set out in the plaintiff’s sales invoices numbers E/135 and E/136.

36.Miss Chan now submits that the plaintiff has “distorted” the relevant figures for the purpose of obtaining against her client that which it was unable to recover against its buyer, Alta.  The basis of her contention is two-fold : first, she says that by reason of the pre-existing contractual arrangement between the plaintiff and Alta, whereby Alta had made a deposit/downpayment in respect of the goods within the two containers as were released, the plaintiff is not at liberty to resile from this pre-existing arrangement; and second, and within the present context clearly the more important contention, she focuses upon duplicate invoices which appear to have been in existence, and which appear to demonstrate that the value of the goods in these containers was considerably less than that stipulated on the face of the sales invoices.

37.These ‘duplicate’ invoices – which also purport to reflect the 21.7% deposit deduction which Miss Chan maintains should be attributed across the board to the invoices the subject of the present claim, as opposed to being arrogated by the plaintiff to invoices issued to Alta which are not the subject of these proceedings – purport to signify that the net amount FOB Xiamen for the goods within the two containers amounts to US$22,936.60, as compared with the total sum now claimed by the plaintiff of US$41,952.90.

38.Mr Lam Chong, the owner of the plaintiff, who was called to give evidence at the eleventh hour, denied all knowledge of these other invoices, and maintained that they fraudulently had been compiled by Alta, the plaintiff’s buyer, using the plaintiff’s letterhead.

39.I confess that I was sceptical of this explanation, not least because it fails to account for the existence of a Textile Export Licence for the like goods submitted by the plaintiff to the Chinese authorities in similarly reduced terms.  The probability is that the plaintiff was in some way privy to under-invoicing in order to assist its buyer, although in the circumstances I have not attributed great importance to these ‘parallel’ invoices, and I do not accept the contention that there has been a deliberate distortion of the figures in order to inflate the current claim.

40.Nor, when the defendant carrier has lost the plaintiff’s goods in the form of the two containers wrongfully released, do I understand why the resultant quantum of claim should be subject to the type of argument now raised by Miss Chan – whose client has nothing whatever to do with the pre-existing contractual relationship/dealings between the plaintiff and its buyer, Alta – and with regard to which specific contractual arrangements I accept the evidence of Madam Kwok.  Moreover, it is trite law that the measure of damage in instances of conversion is the market value of the goods as at the date of such conversion – a rule which exists, in part at least, precisely to avoid the type of ‘apportionment’ argument to which this court now has been subjected on behalf of the defendant.

41.In the circumstances I have little doubt that the value of the misdelivered goods indeed is represented by the invoices now prayed in aid by the plaintiff, that is, Sales Invoices numbers E/135 and E/136.  I so find.

42.It follows that in terms of the plaintiff’s first claim, arising from the admitted misdelivery of the two containers, I find in favour of the plaintiff against the 1^st defendant in the sum claimed, that is, US$41,952.90.

Claim 2: the three uncollected containers

43.It is this aspect of this case which strikes me as somewhat unusual.

44.In essence, the plaintiff says that the 1^st defendant having admitted that it wrongfully had released two of the five containers, thereafter it was left completely in the dark by that defendant as to what had happened to the remaining three, other than the fact that it eventually ascertained that the uncollected cargo had been placed into ‘G.O’, and thereafter had been auctioned by the US authorities.  The plaintiff says that at no time was it informed that substantial storage charges were accruing, and that it had relied upon assurances from the defendant that the defendant would satisfactorily resolve the position in respect of all five containers, and not thereby the two which had been misdelivered.

45.Thus, the plaintiff’s case is that, in breach of its obligations as bailee for reward, the defendant had failed to inform it as to what was happening to its cargo until it was too late, and that had it been apprised of the true position the plaintiff would have been able to make arrangements to collect and dispose of the cargo, for which there clearly was an available market, as the subsequent auction of the contents demonstrated, wherein even on a ‘fire sale’ basis the goods therein had fetched US$52,300, which was slightly less than the projected sale price to Alta of US$55,054.00.

46.The 1^st defendant firmly disputed this case.  Whilst it was common ground that no documentation was ever sent to the plaintiff by the defendant concerning the storage charges which had accrued subsequent to the arrival of these containers, the defendant maintained that the plaintiff was notified of and was well aware of the position, and further asserted that whilst it did indeed attempt to settle the case in terms of the two misdelivered containers – a settlement which had foundered upon differences of view as to quantum – it neither had promised nor represented that a ‘global’ settlement would be forthcoming which would deal with all five containers, although it was accepted, I think, that this plaintiff indeed had wished to secure precisely such an overall settlement.

47.The defendant maintained that in the matter of the three ‘uncollected’ containers that the plaintiff had made a hard commercial decision to leave these three containers – uncollected and unpaid for by the buyer, Alta – and to seek to recover its loss by suit against the carrier.

48.An important factual issue within this debate, therefore, is whether, as the defendant contends, the plaintiff in fact had been told of the position, and simply had chosen to do no nothing.  The court thus is required to make a factual finding as to the plaintiff’s state of knowledge upon this specific issue.

49.The defendant asserts that subsequent to the misdelivery of the two containers, there had been a meeting on 20 December 2000 in the Topocean New York office between, among others, Mr Lam Chong of the plaintiff and Mr Dong Wang, a sales executive of Topocean New York.  Also present at this meeting was a ‘Miss Joyce’, who was identified as Joyce Chan, a former manager of the 1^st defendant who now managed/represented in New York an associate company, also owned by Mr Lam, called Marco Leather Ltd.  Indeed it was said that prior to this meeting, and also subsequent thereto, that this lady, Joyce, had been in frequent telephone contact with the Topocean New York office on the issue of the three uncollected containers, and had been attempting to resolve the situation.  On this case, therefore, the plaintiff clearly was affixed with relevant knowledge.

50.For the plaintiff, Mr Lam Chong said that Joyce Chan had no responsibility for the affairs of the 1^st defendant, that he had not had any such meeting in New York on the issue, and that, in effect, he had been kept in the dark.  His wife, Madam Kwok, also firmly disputed that Joyce Chan held any position or authority within the 1^st defendant.

51.The involvement of this lady, Joyce, is a matter of some sensitivity given allegations made in the evidence as to the nature of the relationship between Mr Lam and Joyce, and whether such went beyond that of employer/employee, although for present purposes there is no need to enter that particular debate nor to make any finding thereon.  However, at the least it appears clear that Joyce Chan remains a trusted manager in New York of an associate company owned by Mr Lam, and in the particular circumstances of this case it would, in my view, beggar belief if Joyce had not made the inquiries that the defendant asserted indeed had been made.

52.Although Mr Lam and Madam Kwok denied any involvement of Joyce Chan in this matter, I regret to say that I did not believe them.  In this regard I formed the view that in this regard they were prepared to say that which they perceived best suited their case.  In my judgment the overwhelming probability is that not only did Joyce Chan act as was alleged, but also that it is very likely that in fact there was such a meeting in New York, as the defendant maintained.  I so find.  On his own case Mr Lam was in New York at that time, and in my view it is highly probable that he took the opportunity to sort out/inquire into the issue regarding the containers of goods for which, of course, he had not been paid, with two of these containers already having been wrongfully released.

53.I unequivocally reject the picture which was attempted to be painted by the plaintiff that it was left with no knowledge of what had become of these three containers.  Mr Lam and his wife, Madam Kwok, struck me as hard-headed and vigorous Hong Kong entrepreneurs, and in my judgment it is inconceivable that they would have permitted the situation to have developed in which they had and continued to have no knowledge of what had happened to goods which, after arrival, Alta had shown no interest in collecting.  Their anger and frustration at the wrongful release of the two containers is evident on the papers, and perhaps was not unjustified, but I am wholly unable to accept the proposition that they remained unaware of the position with regard to the remaining three uncollected containers.

54.Whilst perhaps it does not greatly matter, one corroborative footnote regarding the dispute as to the alleged meeting in New York in December 2000 took the form of an internal email dated 21 December 2000 from Mr Dong Wang of Topocean New York to Rankie Chan of Topocean Hong Kong, wherein he referred to a meeting “yesterday” with “Mr Lim (sic) (Owner of S/Ngei Chong Hong) regarding the two containers” which were wrongly released.  In this context Mr Kerr suggested that the late discovery of this email was indicative of the fact that it was not genuine, and that it had been concocted for the purposes of litigation.  I reject this suggestion.  Computer hard discs frequently yield up information hitherto unrecalled or thought lost, and there is nothing in this email placing me on notice that it has been concocted, or that it is other than genuine.

55.Accordingly, in terms of this element of the claim, whilst I accept that there is no documentation before the court indicating formal notification to the plaintiff of the arrival of the three containers or the expiry of the free storage period and/or the nature of the charges accruing, I do not accept that in the circumstances the plaintiff was ignorant of the true position.  To the contrary, on the probabilities I find that it was well aware of the situation.

56.In this connection I note that by a letter to Alta dated 21 December 2000, written on the letterhead of the plaintiff’s associate company, Chinese Prosperous Development Ltd, a demand is made that the buyer should settle all payment related to the two containers already collected by 28 December, and that “the purchase price for the three containers currently stored in the pier” should be settled by 25 December, and further that Alta was not to be allowed to deduct the down payment already made in settlement of the payment for the two containers because that downpayment was insufficient “to compensate our financial loss for the three containers which are still stored in the pier (if they are not collected by the end of year 2000)”, together with the last container which was yet to be shipped.

57.In addition, by a letter of complaint dated 4 January 2001 from Mr KC Lee of the plaintiff to Mr Felix Wu, head of Topocean in Hong Kong (who notably was not called to give evidence), specific reference is made to the fact that “the other three containers have been placed in G.O., [which] would cause total loss of our product”, and a “satisfactory settlement” was requested, which underlines the point not only as to the plaintiff’s state of knowledge but also the fact that the plaintiff wished to secure an overall settlement in terms of all five containers.

58.On the basis of the papers before the court it is also evident that the plaintiff was hotly in dispute with Alta, its buyer, over the course of dealing between them, including the underlying sales contract, and I have no intention in this case of judging or otherwise speculating upon the merits of this dispute.  What is tolerably clear, however, is that having lost the American buyer whom, having obtained the first two containers, evidently was not interested in collecting the other three, the plaintiff was unwilling, in the absence of locating a convenient alternative purchaser, to pay the accumulated storage charges referable to these three containers; had a satisfactory buyer emerged for these uncollected goods, so that a commercially satisfactory result could have been obtained, it is not suggested that there would have been any difficulty in securing the release from G.O. of these containers upon payment of the outstanding charges which by then had accrued.

59.Accordingly, I have formed the view that the plaintiff elected to let the situation remain as it was in terms of the three uncollected containers, and absent a satisfactory overall settlement with the 1^st defendant, to pursue its claim against the carrier in terms of all five containers which had been shipped.  Arguably there was some initial delay by the 1^st defendant in relaying the position with regard to the containers, but this does not justify the present attempt by the plaintiff to elevate this fact into a full-blown claim for compensation for the entire loss of these goods.

60.Over and above the contention, with which I agree, that the plaintiff had made a hard-nosed commercial decision as to the three uncollected containers, Miss Chan also submitted that under the provisions of the relevant bill of lading the responsibility of the carrier clearly had terminated on the particular facts of this case, with the notification to Alta, the Notify Party, of the arrival of the goods so shipped.

61.In this connection Miss Chan drew the attention of the court to Clause 22 of the bill of lading, entitled ‘Loading and Discharge’, which provided that if the Merchant or his Assign was not ready to take delivery of the goods upon discharge, the Carrier was at liberty to discharge into warehouses “all at the risk and expense of the Merchant, such discharge to constitute a true fulfillment of the contract”; and further to Clause 21, entitled ‘Notification and Delivery’, which provided that the Carrier was entitled to call on the Merchant to take delivery, and that if such was not taken the Carrier was to be entitled to store the goods “at the sole risk of the Merchant”, whereupon “the liability of the Carrier in respect of the Goods … shall wholly cease and the cost of such storage shall be paid by the Carrier on demand”, and that “such storage shall constitute due delivery under this Bill of Lading”.

62.In addition, as Miss Chan pointed out, Clause 10 of the bill of lading clarified that the defences and limits of liability in the bill should apply to any action against the Carrier in contract or in tort, whilst the limits of the Carrier’s responsibility was laid down in Clause 4 : “The Carrier shall be liable for loss and damage to the Goods occurring between the time of receipt and the time of delivery”.

63.I accept these submissions also, although I observe in passing that Miss Chan’s specific reliance upon the terms and conditions of the bill of lading flies in the face of her earlier submission that her client was not the contractual carrier in this case.  Be that as it may.  In my view, on the present facts as I have found them, it is not open to the plaintiff to argue that these goods had remained undelivered, and that the carrier’s liability remained extant and, in effect, open-ended.

64.The evidence is that notification of the arrival of these containers was given to Alta, the buyer and Notify Party under the bill of lading, and I accept the evidence of Grace Yeh, the shipping clerk of Topocean New York, that during a telephone conversation that she had had with Joyce Chan shortly after 3 December 2000, she had told Joyce Chan that if there were no customs clearance that the other three containers would have to be auctioned, and that in turn Joyce Chan had said that she would try to find another buyer.

65.It follows from the foregoing, therefore, that I reject the 1^st defendant’s arguments in so far as they seek to attach liability to the 1^st defendant for these three containers.  Notwithstanding the curious (and largely unexplained) absence of documentation from the defendant directly appraising the plaintiff of the position, and thus arguably constituting a technical breach of the bailee’s duty, I can discern no causative relevance within such omission.  I have found that the plaintiff knew of the situation, through inquiries of its own and those made on its behalf by Joyce Chan, and further that as a matter of contract the goods had been ‘delivered’ under the terms of the bill of lading.  In these circumstances I am quite unable to see how or why the 1^st defendant should be visited with the consequence of a decision by the plaintiff simply to leave the containers where they were in the absence of locating another buyer for these uncollected goods.

66.Accordingly, the plaintiff’s second claim in terms of the three undelivered containers is dismissed.

Order

67.Judgment is to be entered for the plaintiff against the 1^st defendant in the sum of US$41,952.90.

68.There is to be an order nisi that interest on the said sum is to run from 1 December 2000 to the date of judgment herein, that is, 1 August 2005, at the rate of 2% over US dollar prime rate from time to time prevailing, and thereafter upon such principal sum at the judgment rate from time to time prevailing until payment.

69.I further make an order nisi that the costs of this action are to be to the plaintiff, to be taxed if not agreed.

70.There is to be liberty to apply to vary the orders nisi as to interest and/or costs within 14 days of the date of judgment herein, save that the time for any such application is not to run during the vacation.

Mr John Kerr, instructed by Messrs Wong Yuen Chi & Co., for the plaintiff

Miss Terry Chan, instructed by Messrs KM Lai & Li, for the 1^st defendant