Enichem Anic S.p.A. v Ampelos Shipping Company Ltd (Delfini)
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE PURCHAS,LORD JUSTICE MUSTILL,LORD JUSTICE WOOLF |
| Judgment Date | 28 July 1989 |
| Judgment citation (vLex) | [1989] EWCA Civ J0728-16 |
| Docket Number | 89/1152 |
| Court | Court of Appeal (Civil Division) |
| Date | 28 July 1989 |
[1989] EWCA Civ J0728-16
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
PHILLIPS J.
Royal Courts of Justice
Lord Justice Purchas
Lord Justice Mustill
and
Lord Justice Woolf
89/1152
MR. K. ROKISON Q.C. and MR. RICHARD WOOD (instructed by Messrs Clyde & Co.) appeared on behalf of the Appellants (Plaintiffs).
MR. STEWART BOYD Q.C. and MR. H. EDER (instructed by Messrs Holman Fenwick & Willan) appeared on behalf of the Defendants).
Forensic position
The court has before it an appeal, by leave of Phillips J., from an order made by him on 24th March 1988 by which he set aside an order of Staughton J. (as he then was) dated 10th July 1987 and the service of the concurrent writ pursuant thereto. Upon the ex parte application of four named plaintiffs Staughton J. gave leave to them to issue and serve under the provisions of R.S.C. Order 11, rule l(l)(d)(iii) a concurrent writ in Liberia upon the defendants, Ampelos Shipping Co. Ltd. ("the owners"). The fourth plaintiff, Vanol International Ltd. ("Vanol"), is a U.K.—based company who managed the business with which this appeal is concerned on behalf of Vanol International B.V. They acted at all times as agents of the latter. The first three plaintiffs are associated Italian companies. The second and third plaintiffs are different titles enjoyed by the same Italian company. The defendants are an overseas company operating both in Liberia and Greece. The vessel concerned flew the Panamanian flag and was named The Delfini.
By summons dated 29th November 1987 the owners applied for orders setting aside the writ and to discharge the leave to serve out of the jurisdiction granted by Staughton J. and for other relief. This application was heard by Phillips J. who made the order from which this appeal is brought by the first three plaintiffs, namely Enichem Anic SpA, Enichemica SpA/Enichem SpA ("Enichem Anic" "Enichemica").
The claim is presented in the plaintiffs' respective names on behalf of insurers (Lloyds Underwriters Claims and Recoveries) under rights of subrogation. We have not been concerned with other claims by way of arbitration initiated in a similar way on behalf of underwriters.
The claim arises out of an alleged short delivery of a cargo of condensate (oil) shipped in the "Delfini" from Bejaia, Algeria to Gela in Italy. The shortfall was not minimal, namely some 275 metric tonnes on a stipulated cargo of 24,540 metric tonnes. The consignment was one of two shipments to be made under a contract between Vanol and Entreprise Nationale Sonatrach Algeria ("Sonatrach"), providing for the supply by Sonatrach of 100,000 metric tonnes of condensate in two instalments.
In order to come within R.S.C. Order, 11, rule l(l)(d)(iii) the plaintiffs sought to establish a contractual relationship as endorsees of a bill of lading under section 1 of the Bills of Lading Act 1855 ("the 1855 Act"). Although other issues, e.g. forum conveniens and lack of frankness in the plaintiff's affidavit on the ex parte application, were raised before the judge, on this appeal we have been solely concerned with the application of the 1855 Act. The case presented by Mr. Hirst on behalf of the plaintiffs before the judge rested upon the contention that at the time that the bill of lading was transferred to Enichemica, which was after the discharge of the cargo, it nevertheless remained a valid transferable document of title. Mr. Hirst submitted that as a result of the short delivery, the bill of lading contract had not been discharged by complete performance. He also contended that under a wide interpretation of section 1 of the 1855 Act the endorsement of the bill of lading by Vanol to Enichemica and Enichem Anic would permit the latter to sue the owners under the bill of lading contract in respect of the short delivery.
In particular, Mr. Hirst accepted before the judge that, apart from the short delivery, the property in the cargo was transferred to the plaintiffs when it was discharged from the Delfini into the first plaintiffs' tanks at the port of discharge. Nor indeed was any issue raised to the contrary in the appellant's skeleton argument which was delivered to the court in accordance with the practice direction issued by the Master of the Rolls on 1st March 1989 ( [1989] 1 W.L.R. 281), dated 9th May 1989. It was, however, indicated in this skeleton argument that the plaintiffs would seek to adduce further evidence and to amend the notice of appeal so as to establish constructive transmission of the bill of lading to Enichem Anic upon its receipt by Enichemica on their behalf. This application was duly made and not opposed and the court granted leave for the admission of the evidence and the amendment of the notice of appeal. However, in the event, nothing turned upon these particular issues.
Very shortly before the date fixed for the hearing of the appeal the appellants submitted a supplementary skeleton argument. For practical purposes there was no opportunity to study the fresh submissions which were to be made by Mr. Rokison in presenting the appeal on behalf of the plaintiffs. In the event, the case argued by Mr. Rokison consisted almost exclusively of the points raised in the supplementary skeleton argument. In summary, Mr. Rokison made three submissions namely:
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(1) that the discharge of the cargo was not relevant to the question whether the property in the cargo passed upon the endorsement of the bill, or whether the delivery of the endorsed bill of lading could form a link in the passing of property from Vanol to the plaintiffs;
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(2) that it was the common intention established by the terms of the contracts and the circumstances of the transaction that the delivery of the endorsed bill effected the passing of the property in the cargo; and
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(3) in the alternative, if the property in the cargo had passed at some point before the endorsement of the bill of lading, the passing of the property was only conditional.
Mr. Rokison frankly conceded that these issues had not been argued before the judge although he submitted that they were covered by the terms of the notice of appeal. Mr. Boyd, whilst complaining about the manner in which the appellants' case had altered and relying upon it as an indication of lack of validity, nevertheless did not formally object to Mr. Rokison pursuing these arguments and helpfully accepted that he was in a position to deal with them without an adjournment. Whilst a change of front of this nature strikes at the heart of the new procedure which the court is anxious to introduce, we did not consider it was open to us as a matter of jurisdiction to refuse to accept the submissions made in these circumstances, nor if those submissions would otherwise have carried weight to have decided the merits of the appeal accordingly. That having been said, it would be regrettable if, as was suggested upon the introduction of further counsel, if done at a later stage, that the purpose of the skeleton arguments procedure should be frustrated.
Commercial history
The main contract of sale of 100,000 metric tonnes of condensate bought by Vanol B.V. from Sonatrach was confirmed by telex dated 2nd July 1985 and contained, inter alia, the following relevant terms:
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"7. /Method and place of delivery/ fob Arzew [later amended to Bejaia].
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8. /Destination/ these cargoes cannot be resold and have to be processed to your own account.
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9.…
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10. /Title and risks of loss/ to transfer from seller to buyer as oil passes the flange connecting the shore facilities pipeline or hose to the receiving vessel at load port".
Although the original agreement provided for two cargoes of 50,000 metric tonnes to be shipped in the third and fourth quarter of 1985, in the event the first shipment was only a little under half the contractual amount.
By the contract contained in telex messages of 26th July, Vanol B.V. sold to Enichemica a quantity between 20,000 and 25,000 metric tonnes of condensate c.i.f. Gela, a port in Italy. The terms of this contract contained, inter alia:—
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1 "Payment is in U.S. dollars by transfer to seller's account within 4 days of completion of discharge or 7 days after notice of readiness given by vessel whichever earlier, against commercial invoice and documents or seller's telex letter of indemnity for missing documents countersigned by a bank or issued by a bank.
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2. Buyer to open a bank guarantee in a first class bank not later than on nomination of vessel in a form acceptable to sellers.
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3. Other terms: as per Inco terms 1980 plus latest amendments for CIF deliveries.
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4. Proforma invoice: to be sent by telex addressed to Enichem Milan office…latest four days prior vessel arrival.
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5. Final commercial invoice and usual shipping documents (or letter of indemnity countersigned by seller's bank) must be to Enichem hands at least 3 working days prior due payment date.
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6. Documents essential on board: bill of lading, certificate of origin…"
On 29th July Enichemica sold the same cargo to Enichem Anic c.i.f. Gela. This contract is on a standard form used between the two companies whom, it will be remembered, are associated. It is not necessary to rehearse any of these terms.
On 30th July 1985 the owners and Vanol International entered into a voyage charterparty. The document is dated "London, 30th July 1985". and names ss. Delfini sailing under the Panamanian flag. The following terms...
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