Pakistan Case Lawโ† Search
2007 CLD 1392

BULK INTERNATIONAL TRADERS INC, EGYPT vs MV. "AFAMIA" through Master

Citation2007 CLD 1392
CourtSindh High Court
Case No.A.D.M. Suit No.13, C.M.As. Nos. 739, 740, 718 and 729 of 2007
Date2007-07-27
Judge(s)Zia Pervez
ResultOrder accordingly

ORDER

ZIA PERWEZ, J.---Granted.

2. Plaintiff has moved this application under section 151, C.P.C. Read with Rule 731 of Sindh Chief Court Rules (OS) seeking enhancement of the amount of security from US $386,399.31 to an enhanced sum of US $489,299.31.

Contention of Mr. Shaiq Usmani is that the amount reflects different rate of freight paid by the plaintiff on account of extra trade for shipment of the balance quantity of the consignments of cement which was not loaded on board the vessel M V. Afamia in terms under Charter Party.

Mr. Mazhar Lari, has waived notice of this application and has advanced his arguments on the basis of documents annexed to the plaint and applications filed by the plaintiff. Opposing the application Mr. Lari pointed out that the Charter Party Agreement pertains to shipment of minimum quantity of 14700 M/tons cement from the port of Pipavav to Djibouti. The defendant No.1 vessel was available for the purpose of loading that was expected to have been completed at the agreed rate of 1500.00 M/Tons per working day i.e. Within a period of ten working days or thereabout. However, in spite of the vessel being available at the Port of shipment for over 24 days, only a quantity of 3,960.400 M/tons of cement could be loaded due to non-availability of the goods. The Charter Party did not provide for shipment from any port other than Pipavav India or Karachi Pakistan to the Port of Djibouti. Fixing Note dated- 19-7-2007 pertains to shipment. Of 8000 M/tons of cement in loose bags of 50 kgs and the port of loading is Porbandar. Porbandar is in India and located at a distance of about 400 miles from the Port of Pipavay. Porbandar is not a port of loading under the terms of Charter Party/Fixing -Note between the plaintiff and the defendants, therefore, the freight rate for transport of cargo from Port of Porbndar, which was not a designated port under the terms of Charter Party, does not give rise to any claim against the present defendants. Secondly it also confirms that the balance cargo was shipped from Porbandar and was not available for the shipment at the designated port of Pipavay.

As the claim pertains to a cargo shipped from a port not designated under Fixing Note or a Charter Party, the claim for damages based on cost of shipment of cargo from Porbandar to Djibouti has no relevance to the freight for transport of cargo under the contract for shipment from a different port viz. From Pipavav to Djibouti which cargo was even otherwise, not available at the port of Pipavav for shipment, as is apparent from the documents filed by the plaintiff himself. This application therefore has no merit and is accordingly dismissed.

3/4. By the application (C.M.A. No.718 of 2007) under rule 731 of Sindh Chief Court Rules (O.S.) the plaintiff prays for arrest of defendant No.1 Vessel M.V. Afamia with directions that the said vessel may not be allowed to sail from territorial water of Pakistan till furnishing security for amount of US $664,299.31, being the losses suffered by the plaintiff due to misappropriation and/or conversion of cargo of plaintiff due to repudiation of Voyage Charter Party. During the pendency of this application plaintiff moved a further application under Order XXXIX Rules 1 and 2 read with sections 94 and 151, C.P.C. (C.M.A. No.729 of 2007) seeking attachment of bunkers on board the vessel defendant No.1 till furnishing of security for the amount of claim of the plaintiff. Parties have filed their respective counter-affidavits and rejoinders to the applications. Plaintiff claims to have Voyage Charter of defendant No.1 vessel under fixing note dated 29-5-2007 for loading the consignment of 14700 M/Tons of cement at the Port of Karachi or Pipavav India at Charter's option for carriage to the port of Djibouti. In pursuance of the declaration of the plaintiff notice of readiness was tendered by the defendants for loading the cargo from the Port of Pipavav on 16-6- 2007. In spite of commencement of loading, the quantity loaded up to 9-7-2007 was only 3960.4 M/Tons instead of a minimum 14700 M/Tons as agreed in fixing note. The vessel left the port of Pipavav without plaintiffs agreement and without loading of the remaining cargo to the extent of 14700 M/Tons. Offer made by the plaintiff to load additional cargo at Porbandar India subject to payment of additional payment of bunker cost was also tendered to the defendants, which was refused. Defendants Nos.1 and 2 without agreement of the plaintiff issued Mate Receipt followed by freight prepaid bill of lading dated 9-7-2007.

The act of leaving the port without loading the complete quantity of cargo without the consent of the plaintiff amounted to misappropriation of cargo to the. Extent of 3960.4 M/Tons on board, hence the plaintiff suffered losses as mentioned below:-

1. Value of Cargo on board defendant No.1 vesselUS $ 265,718-31

2. Freight paid US $ 120,681-00

3. Additional freight for arranging-carriage of balance cargo.US $ 102,900-00

4. Consequential losses. US $ 175,000-00 Total US $ 664,299-31 Hence the plaintiffs invoked the admiralty jurisdiction of this Court and instituted the suit for recovery of the aforesaid amount along with the aforesaid applications. Mr. Shaiq Usmani, learned counsel for the plaintiff, has contended that the plaintiff instituted present suit on learning . That defendant No.1 vessel is berthed at Karachi seeking protection of Rule 731 of Sindh Chief Court Rules (O.S.) providing for institution of admiralty suit without full particulars. Mr. Usmani proceeded to argue that irrespective of the transaction, the cause of action to invoke admiralty jurisdiction of this Court accrued is founded by the presence of vessel at port of Karachi. That the freight was payable to the defendants. Owner and referring to the subsequent and changed version that the bill of lading was not actually issued, he proceeded to argue that the case of misappropriation of cargo is prima facie made out. That the fixing note provided for demurrage at the rate of US$5000 per day in case of delay and the defendants were entitled to recover the amount and were thus obliged to wait at the port of Pipavav till loading of entire cargo and that the vessel cannot leave the port unless defendants repudiates the Charter. His next contention is that at top of the cargo loaded on the vessel at Pipavav further quantity of about 11000 M/Tons of cement in bags has been loaded in four holds of the vessel at Karachi. Such loading on, top of cargo of the plaintiff amounts to conversion of cargo giving rise to action of torts. In support of his contentions he placed reliance on Sui Gas Transmission Co. v. M.V. Good Herald (1983 CLC 886), Schwarz and Co. (Grain) Ltd. v. St.

Elefterio (Owners) [1957 (1) Llyods Report 283], The Ethel Radclifee Steamship Company Ltd. v. W.R.

Barnett Ltd. [1925) 23 Llyod.s Report 279], Ethel Redcliffe Steamship Company Ltd. v. W&R Barnett Ltd. [1926) 8 Lloyds Reports 277] and trathlorne Steamship Company Ltd. v. Andrew Weir [1935 Lloyds Reports 184].

Opposing the application, Mr. Mazhar Lari, learned counsel for defendants, referred to paragraphs 11 and 12 of the counter-affidavit to C.M.A. No.718 of 2007 wherein it has been averred that no cargo was available for shipment in addition to that loaded on board which has not been denied by the plaintiff in their rejoinder. That the question of conversion of cargo does not give rise as both the consignments loaded at the port of Pipavav and at Karachi are distinctly branded and packed and will be completely distinguishable at the time of discharge of cargo, therefore, question of an action of tort does not arise. That the instructions of the plaintiff to proceed to the Port of Probandar contrary to the terms of Charter Party and fixing note, being extraneous and contradictory to the contract, resulted in repudiation of the contract by the plaintiff himself. That the defendants have performed their part of contract. The first contention of Mr. Shaiq Usmani as to the omission of specific particulars at the time of institution bringing an action in admiralty jurisdiction of this Court is duly protected under the law.

Indeed the exigencies in the shipping trade are considered and the law provides adequate protection to prevent any just claim from being brushed aside for want of specific details. Rule 77 indeed applies to such specifics as may not be available at the time of institution of suit. However, it cannot be made a ground to suppress such specific details of basic nature, which are fully within the knowledge of the plaintiff and are suppressed with an apparent object of obtaining orders at the back of the affected party. Plaintiff has annexed copy of the fixing note a Annexure A. To the plaint, names of the despondent owners of vessel namely Prochart Sarl Beirut is specifically mentioned in the document. They have not been joined as a party to the proceedings. In fact being the Charterer of the Vessel the plaintiff would have been in a position to reply specifically to the facts pleaded. Mere fact that in their counter-affidavit the owners of the vessel, who in the absence of knowledge of specific facts denied the fact of issue of Mate Receipts or bill of lading for want of knowledge, cannot be saddled with liability for misappropriation of any cargo particularly when plaintiff himself has specifically admitted the fact that the cargc has been shipped after issuance of bill of lading by the local agents, who under the terms of fixing note were appointed by the plaintiffs themselves to discharge the formalities requisite for obtaining port clearance and leaving of the vessel from the.Port of Pipavay. Such action on the part of the local agents of the vessel appointed by the plaintiff themselves reflects an implied agreement on their part. With the vessel sailing with cargo on board against which a freight prepared bill of lading has already been issued, the question of misappropriation of cargo is hardly made out.

The second contention of Mr. Shaiq Usmani that the loading of additional cement in bags already available in holds of the vessel has not been specifically pleaded. Mere statement to the fact that the additional cargo of cements is being loaded at the port of Karachi over cargo on board does not constitute any act of conversion of cargo as two shipments are under separate shipping marks, the cement shipped at Pipavav is contained in yellow bags duly marked with. Haathi Brand, as distinct from the additional cargo shipped at Karachi showing the marks of Thatta Cement. For the foregoing reasons it is prima facie clear that the vessel remained at the port of Pipavav for about 24 days where instead of loading about 1500 M/tons of cargo per day, the cargo loaded was only 3960.4 M/Tons in 24 days or thereabout resulting in an average load of less than 200 M/Tons per day; that the cargo was not available for loading at Pipavav; that by calling upon the defendants to load the cargo at Porbandar, which is at a distance of about 400 miles from the designated port, the breach or act of repudiation of contract can only be attributed to the plaintiffs. Defendants can claim their right to take appropriate action against the plaintiffs, as may be available to them, according to law. Mr. Mazhar Lari has also made a categorical statement before this Court that the vessel is proceeding to the Port of Djibouti and defendants have its additional cargo from Karachi to minimize the loss.

That a proposal made for loading of cargo from the Port of Porbandar dated 12-7-2007, one day after the arrival of the vessel at Port of Karachi on 11-7-2007, does not create any obligation as against the defendants to avoid from the designated route rather the vessel is taking cargo on board to minimize the losses and keep the claim of the defendants, as may be raised subsequently against the plaintiffs, at a lower side. Under the circumstances, in view of the principles laid down in case of Jaffer Brothers (Pvt.) Ltd. v. M.V. Eurobulker II (2002 CLD 926); V.N. Lakhani and Co. v. M.V.

Lakatoi Express (PLD 1994 SC 894), D.H.L. International v. N.T.C. Ltd. (1982 CLC 1360), MEC Shipbreakers Ltd. v. Peason Investment (PLD 1982 Karachi 701) and Abdullah v. Muhammad Moizuddin (PLD 1955 Sindh 330), the applications have no merit. For the foregoing reasons it is prima facie apparent that the plaintiff has not approached this Court by way of present suit with clean hands. The breach of contract giving rise to the alleged claim, in the circumstances, cannot be attributed to the defendants. The contracting party known to the plaintiff namely Prochart Sari Beirut deliberately has not been joined as a party to the proceeding. Furthermore, the shipper is Gujarat Sidhee Cement Limited belonging to India and the plaintiffs being not the shippers, the question of handing over the bill of lading to them does not arise. The case-law cited by Mr. Shaiq Usmani are distinguishable from the present case as the cargo is distinguishable and mere fact of such bags in the same hold would not amount to conversion of cargo. In view of the above, the application having no merit are accordingly dismissed. However, in view of the statement made by Mr. Mazhar Lan that the local agents of the defendant No.1 are prepared to execute undertaking before the Nazir of this Court in the sum of US $400,000 to the effect that cargo loaded from the Port of Pipavav as well as Karachi and designated for the Port of Djibouti will be discharged by defendant No.1 at the said port of Djibouti, the same may be filed by the local agents of the vessel at Karachi before the Nazir of this Court.

The earlier order of arrest of the vessel is accordingly withdrawn.

For educational and research use only โ€” not legal advice. Verify against the official report before relying on it. See our Disclaimer.
DisclaimerยทPrivacyยทTermsยทSearch