JAWWAD S. KHAWAJA, J.---These four appeals, as of right, have been heard together and are being disposed of by means of this common judgment since all four appeals arise from the same.
Judgment of a learned appeal Bench of the Sindh High Court dated 30-3-2004. The facts necessary for the adjudication of these appeals are relatively straightforward. In order to understand fully the controversy before us, it is necessary to give a brief factual narration leading up to the filing of these appeals.
2. Sadruddin (plaintiff) sole proprietor of Messrs Sadruddin and Co. Filed two suits in the admiralty jurisdiction of the Sindh High Court. In Suit No,27 of 1999, the plaintiff made a claim of Rs,4,650,322 against four defendants namely, C.V. "Lemon Bay" (defendant No,1), Messrs Yangming Marine Transport Corp., the shipping company (defendant No,2.), Messrs Inshipping (Pvt.) Ltd. The shipping agent (defendant No,3) and Messrs Akil Industries (defendant No,4) the consignee of six shipments of potatoes consigned by the plaintiff. According to the plaintiff the defendants Nos.1 to 3 were liable to satisfy the claim made in the plaint because even though the consignments were delivered to defendant No,4, the defendants Nos.1 to 3, and in particular the shipping company had not obtained the bank guarantees necessary for the release of the consignments. In Suit No,31 of 1999, the plaintiff made ,a claim of Rs,1,316,635 against four defendants namely, C.V. "Sinar Padang"
(defendant No,1), Messrs Samudera Shipping Line Ltd. (defendant No,2) the shipping company, Messrs Megatrans Pak (Pvt.) Ltd. (defendant No,3) the shipping agent and Messrs Akil Industries (defendant No,4) the consignee of two shipments -of potatoes consigned by the plaintiff.
According to the plaintiff, as in the other suit, the defendants Nos.1 to 3 were liable to satisfy the claim made in the plaint because even though the consignment was delivered to defendant No,4, the defendants Nos.1 to 3 and in particular the shipping company had not obtained the bank guarantees necessary for the release of the consignments.
3. Both the suits were decreed by the learned trial Bench in the High Court but not to the extent of the entire amount claimed by the plaintiff. The learned trial Bench decreed Suit No,27 of 1999 for a sum of Rs,17,47,845 while Suit No,31 of 1999 was decreed for a sum of Rs,467,107 with mark up @ Rs,12% per annum from the date of institution of these suits. The defendants Nos.1 to 3 filed appeals to challenge the decrees passed by the learned trial Bench. The plaintiff did not challenge the decrees of the learned trial. Bench. The learned appeal Bench heard both the appeals together, on the consideration that common questions of fact and law arose in both appeals. The appellate Bench vide judgment and decree dated 30-3-2004 modified the decree of the learned trial Bench by reducing the amount of the decree to Rs,7,40,955.60 in Suit No,27 of 1999 and to Rs,2,02,480 in Suit No,31 of 1999. Both parties were dissatisfied with the appellate decree. It is for this reason defendants Nos.1 to 3 in the two suits have filed Civil Appeals Nos. 1444 and 1445 of 2004. It is their case that they are not liable for any amount. Civil Appeals Nos.1446 and 1447 of 2004 have been filed by the plaintiff Sadruddin who seeks the setting aside of the appellate judgment and the restoration of the decree of the learned trial Bench.
4. We have heard learned counsel for both sides at length yesterday and today. It is not necessary to elaborate their arguments in detail because the controversy between the parties is narrowed down to the reasons which prevailed with the appellate Bench for reducing the amounts decreed by the learned trial Bench. It will suffice for the present, therefore, to set out the facts relevant for the purpose of determining if the appellate Bench was justified in reducing the amounts decreed by the learned trial Bench. It is not in dispute that six consignments of potatoes were shipped by the plaintiff to the consignee/defendant No,4 through two vessels namely Lamon Bay and La Boheme.
These consignments are subject matter of Suit No,27 of 1999. In the other suit (Suit No,31 of 1999) two consignments were sent by the plaintiff on two vessels namely, Sonar Padang and Swat. The reason which persuaded the learned appellate Bench to modify the decree of the learned trial Bench was that in the first case (Suit No,27 of 1999) the vessel La "IT) Boheme had not been impleaded as a defendant and nor was it averred in the plaint that the vessel La Boheme was a sister ship of Lamon Bay, in terms of the Admiralty Jurisdiction of High Courts Ordinance (1980) (the Admiralty Ordinance). Likewise in the other appeal arising from Suit No,31 of 1999, the appellate Bench observed that the plaintiff had not impleaded the vessel Swat as a defendant and nor had any averment been made in the plaint that such vessel was a sister ship of the vessel Sinar Padang.
5. After hearing learned counsel for both sides, we are clear that the amounts decreed by the learned trial Bench in the two suits could not have been reduced on the basis of the aforesaid reasoning. This is so because the claim of the plaintiff was based on the contract of carriage executed on behalf of the shipping companies in each case and the modification agreed by them that the consignments would be released against bank guarantees and not on DAP basis as originally agreed. In the written statements filed in each case on behalf of defendants Nos.1, 2 and 3, it has not been denied that the bank guarantees obtained by defendant No,2 before delivering the consignments to defendant No,4 were forged. In effect this would mean that the purported guarantees were mere scraps of paper. These papers, therefore, could not be equated with bank guarantees which defendant No,2 (in each case) was obliged to obtain on behalf of the plaintiff, before releasing the consigned potatoes to the consignee. We may note at this stage that although learned counsel for the defendants made an attempt to argue that the plaintiff was himself responsible for the forged documents, this is not an open question before us because this has not been the stance adopted by the defendants in their written statements.
6. Since the defendants did not obtain the bank guarantees and released the consignments, the plaintiff did suffer a monetary loss. It, therefore, follows that the plaintiff was entitled to a decree against the defendants. At this juncture, it is important to bear in mind the provisions of section 3(2)(h) of the Admiralty Ordinance which provides that "the Admiralty jurisdiction of the High Court shall be as follows, that is to say, jurisdiction to hear and determine any of the following causes, questions or claims . . . (h) any claim arising out of any agreement relating to the carriage of goods in a ship . . ." When we examine section 4(4) of the Admiralty Ordinance along with the said statutory provision, it becomes clear that an action in personam can be founded on any agreement such as a bill of lading relating to the carriage of goods in a ship. In addition to the right to bring an action in personam, the admiralty jurisdiction of the Court can also be invoked for an action in rem for the arrest of a sister ship such as La Boheme in the case of Suit No, 27 of 1999 and the vessel Swat in the case of Suit No,31 of 1999. The learned appellate Bench in the High Court has held that the plaintiff had not asserted any claim against the sister ship and it was for this reason that the amount decreed by the learned trial Bench was reduced to the extent of the claim related to consignments which were shipped on such sister ships. The terms of the appellate decree may, at this stage, be usefully reproduced as.
"Learned counsel for the [plaintiff] was not in a position to persuade us that in absence of pleadings in terms of section 4(4), (of the Admiralty Ordinance] the claim in respect of 'LA BOHEME' can be enforced in an action in rem against 'LAMON BAY. Likewise claim in respect of 'Swat cannot be enforced in an action in rem against . 'Sinar Padang'. Therefore, the claim against the offending vessels `LA BOHEME' and 'SWAT are not enforceable against the appellant No,
1. Resultantly, the respondent consignor claims are reduced to the extent of consignments shipped on vessles 'LAMON BAY' and 'SINAR PADANG', which are as follows:-- (i)In Appeal No.8 of 2003 (a)
C55001432312-4-1999 LAMON BAY 4200 BAGS Potatoes6860.70 (b)
C55001432212-4-1999 LAMON BAY 4200 BAGS 6860.70 Total US$ 13721.40 equivalent to Pak Rs.
7,40,955.60 (ii)In Appeal No.9 of 2003 (c)
KHI/CBO.453016-4-1999 SINAR PADANG 25250 BAGS of potatoes3794.63 equivalent to Pak Rs. 2,02,480 ' Resultantly, the appeals are partly allowed with proportionate costs. The decrees are modified in the sum of Rs,7,40,955.60 (in Adm. Suit No,27 of 1999) and Rs,2,02,480 (in Adm. Suit No,31 of 1999) respectively".
7. After examining the law and considering the arguments advanced on behalf of both sides, we are agreed with learned counsel for the plaintiff that the learned appellate Bench fell in error when it reduced the amounts decreed by the learned trial Bench. Even if it is held that the sister ships had not been impleaded as defendants in the two suits and that there was no avermept in the plaint asserting a claim against the sister ships, the decree in personam could still have been passed against defendants Nos.1 to 3 even if a decree in rem was not permissible against the sister ships in view of section 4(4) of the Admiralty Ordinance. At this learned counsel for the defendants contended that the sister ships had been wrongly and unlawfully arrested in the Suits Nos.27 of 1999 and 31 of 1999 because the said ships were not parties and in the absence of pleadings to establish the relationship between the defendant No,1 (in each case) and the sister ships these ships could not be burdened with liability for the plaintiffs claim. This argument, however, does not in any manner affect the decree in personam obtained against the defendants Nos.1 to 3 (in each case). The only affect of such a shortcoming would be that the vessels impleaded as defendant No, 1 in the two suits may not be liable for losses occasioned by the plaintiff in relation to consignments which were not carried by the said vessels.
8. In view of the foregoing discussion, Civil Appeals Nos.1444 and 1445 of 2004 are dismissed while Civil Appeals Nos.1446 and 1447 of 2004 are allowed. Consequently, we set aside the judgment and decree of the learned appellate Bench dated 30-3-2004 and restore that of the learned trial Bench dated 22-9-2003.
9. Before parting with this judgment, we may note the submission of learned counsel for the defendants that loss had been caused to the shipping companies on account of the unlawful arrest of the sister ships namely, La Boheme and Swat. That, however, is not a question before us.
The shipping companies, if they have a remedy under law, may invoke the same.