Finagra (UK) Ltd v OT Africa Line Ltd [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | Rix J. |
| Judgment Date | 24 June 1998 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 24 June 1998 |
Queen's Bench Division (Commercial Court).
Rix J.
Lawrence Akka (instructed by Turner & Co) for the plaintiff.
Christopher Butcher (instructed by Jackson Parton) for the defendant.
The following cases were referred to in the judgment:
Adamastos Shipping Co Ltd v Anglo-Saxon Petroleum Co Ltd (“The Saxon Star”)ELR [1957] 2 QB 233; [1959] AC 133 (HL)
Aron (J) & Co Inc v The Askin (1959) 267 F 2d 276.
Bunge SA v Deutsche Conti-Handelsgesellschaft (mbH) (No. 2)UNK [1980] 1 Ll Rep 352.
Chellaram (P S) & Co Ltd v China Ocean Shipping Co (“The Zhi Jiang Kou”)UNK [1991] 1 Ll Rep 493.
Compania Portorafti Commerciale SA v Ultramar Panama Inc (“The Captain Gregos”)UNK [1989] 2 Ll Rep 63; [1990] 1 Ll Rep 310 (CA).
Goulandris Brothers Ltd v B Goldman & Sons LtdELR [1958] 1 QB 74.
Hamilton & Co v Mackie & Sons (1889) 5 TLR 677.
Hispanica de Petroleos SA v Vencedora Oceanica Navegacion SA (“The Kapetan Markos NL”)UNK [1986] 1 Ll Rep 211.
Holland Colombo Trading Society Ltd v AlawdeenUNK [1954] 2 Ll Rep 45.
Idaho (D/S A/S) v Peninsular and Oriental Steam Navigation Co (“The Strathnewton”)UNK [1983] 1 Ll Rep 219.
Interbulk Ltd v Ponte dei Sospiri Shipping Co (“The Standard Ardour”)UNK [1988] 2 Ll Rep 159.
Ion, TheUNK [1971] 1 Ll Rep 541.
Mauritius Oil Refineries Ltd v Stolt-Nielsen Nederlands BV (“The Stolt Sydness”) [1997] CLC 417.
Metalfer Corp v Pan Ocean Shipping Co Ltd [1997] CLC 1574.
Navigazione Alta Italia SpA v Concordia Maritime Chartering AB (“The Stena Pacifica”)UNK [1990] 2 Ll Rep 234.
Noranda Inc v Barton (Time Charter) Ltd (“The Marinor”) [1996] CLC 337.
Sabah Flour and Feedmills Sdn Bhd v Comfez LtdUNK [1988] 2 Ll Rep 18.
Thomas (T W) & Co Ltd v Portsea Steamship Co LtdELR [1912] AC 1.
Varnish (W R) & Co Ltd v The Kheti (Owners)UNK (1949) 82 Ll L Rep 525.
Shipping — Time bar — Bill of lading contained nine-month time bar “subject to any provision of this clause to the contrary”— Bill incorporated Hague Rules “save as otherwise provided in this bill of lading”— Whether special nine-month time bar took precedence over one-year Hague Rules limit — Hague Rules, art. III, r. 6, 8.
This was an application for the court to determine as a point of law under O. 14A whether certain cargo claims were time barred.
The plaintiff, Finagra, sued on bills of lading relating to the carriage by the defendant carrier of cocoa beans by sea from Lagos to Rotterdam and onwards to Amsterdam by road. The bills of lading contained a “carrier's responsibility” clause covering “port to port” and “combined” transport. The transport was “combined transport” because the bills indicated that the place of delivery was Amsterdam. In the case of combined transport the bills of lading provided that “save as otherwise provided in this bill of lading” the Hague Rules (and where compulsorily applicable by any national law the Hague-Visby Rules) would apply where the stage of carriage where loss or damage occurred was not known. Where the stage of carriage where loss or damage occurred was known, the liability of the carrier would be determined by the relevant international convention: in the case of carriage by sea, the Hague (or Hague-Visby) Rules. The clause also contained a time bar subclause providing for suit to be brought within nine months “subject to any provisions of this clause to the contrary”. Finagra took proceedings against the defendant for alleged damage to the shipments more than nine months after delivery but within the one-year limitation period contained in art. III, r. 6 of the Hague Rules. The question under O. 14A was whether the nine-month time bar applied.
Held, ruling that Finagra's actions were not time barred:
The incorporation of the Hague Rules meant that they were taken to be set out in extenso in the bill. The nine-month time bar clause was expressly set out in the bill. The first proviso, “save as otherwise provided in this bill of lading”, indicated that the incorporation of the Hague Rules (or other conventions) was not to be paramount. But the second proviso which introduced the special time bar clause itself, “subject to any provision of this clause to the contrary”, was decisive. The provision in the clause to the contrary was art. III, r. 6 of the Hague Rules (and its equivalent in the other conventions). It followed that art. III, r. 6 and its equivalents retained priority. Thus the first proviso was to be read as meaning “save as provided in this bill of lading otherwise than in the incorporated conventions”. The nine-month time limit applied outside the scope of the Hague Rules and other conventions, i.e. where loss or damage occurred in circumstances not covered by the conventions. That construction gave effect to both provisos and both time bar clauses and avoided the problem of applying a period of limitation to a case of loss or damage known to occur within a particular stage of the carriage shorter than would apply to it under the relevant convention. If the two provisos were in conflict, the second relating to the time bar clause should prevail, even if that meant the nine-month period became entirely nugatory. If the operation of the two provisos rendered the matter ambiguous or unclear, the longer period should prevail. (Holland Colombo Trading Society Ltd v AlawdeenUNK[1954] 2 Ll Rep 45applied;Sabah Flour and Feedmills Sdn Bhd v Comfez LtdUNK[1988] 2 Ll Rep 18considered.)
Rix J: This case raises again the question whether a special time bar provision does or does not take precedence over the one-year limitation regime of the Hague Rules. The special provision allowed only nine months.
The plaintiffs, Finagra (UK) Ltd, have brought four actions against the defendants, OT Africa Line Ltd (“the line”), arising out of alleged damage to a number of shipments of cocoa beans which the line carried by sea from Lagos to Rotterdam and onwards from Rotterdam to Amsterdam by road. In all four cases suit has been commenced against the line more than nine months after delivery, but before the year was up. That raises a point of construction on the bills of lading, which the parties have asked the court to decide under O. 14A.
The cargoes were carried under bills of lading, which contained a complex “Carrier's Responsibility” clause, cl. 5. I shall have to set out large sections of that clause, below. However, its essential, but by no means only, peculiarity was that, in the circumstances which obtain in this case, the relevant incorporation of the Hague Rules was preceded by the words “save as is otherwise Provided in this Bill of Lading”, whereas the nine-month time bar was preceded by the words “Subject to any provision of this clause 5 to the contrary”. In between lay the incorporation of the Hague Rules, with its one-year time bar contained in art. III, r. 6 (“In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered”) and its paramountcy provision in art. III, r. 8 (“Any clause, covenant or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with goods arising from the negligence, fault or failure in the duties and obligations provided in this Article or lessening such liability otherwise than as provided in these rules, shall be null and void and of no effect”). Thus the conflict between the incorporated one-year time bar and the express nine-month time bar arises in an especially aggravated form. Is the nine-month time bar a matter “otherwise Provided in this Bill of Lading” and thus intended to take precedence over the general incorporation of the Hague Rules? Or is the incorporation of the Hague Rules and thus of their one-year time bar a “provision of this clause 5 to the contrary” and thus intended to take precedence over the nine-month time bar?
With that brief introduction, I can turn straightaway to cl. 5.
Clause 5 distinguishes between “Port to Port Shipment” and “Combined Transport”. I have mentioned that the cargoes in question were carried from Lagos to Rotterdam by sea and onwards to Amsterdam by road. The bills of lading covered the whole of that journey, for they stated that they were issued at Lagos, with a “Place of Discharge” at Rotterdam and a “Place of Delivery” at Amsterdam, and “Carriage” is defined in the bills as “the whole of the operations and services undertaken by the Carrier in respect of the Goods”. Under the terms and definitions of the bills it is common ground that these were all cases of “Combined Transport” rather than “Port to Port Shipment”. This is because combined transport is defined as “when the Place of Receipt and/or the Place of Delivery are indicated on the face hereof”: and the place of delivery box on the face of the bills did state Amsterdam, even though the place of receipt box was left empty. port to port shipment is defined as everything else, viz. “where the Carriage called for by this Bill of Lading is not Combined Transport”. Thus combined transport and port to port shipment are mutually exclusive. Those definitions are contained in cl. 1 of the bills.
Clause 5 is divided into three parts. Part (A) deals with port to port shipment, pt. (B) deals with combined transport, and pt. (C) deals with “General (applicable to both Port to Port Shipment and Combined Transport)”. Effectively no submissions were addressed to me regarding pt. (C), and therefore I will not set it out. I shall set out pt. (A) and (B) in full, however, emphasising, for the convenience of readers, the phrases or clauses to which counsel drew attention.
“5. CARRIER'S RESPONSIBILITY
(A) Port to Port Shipment
Where the Carriage called for by this Bill of Lading is a Port to Port Shipment then:
(1) the liability (if any) of the...
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