Herceg Novi (Owners) v Ming Galaxy (Owners)

JurisdictionEngland & Wales
JudgeSir Christopher Staughton
Judgment Date16 July 1998
Judgment citation (vLex)[1998] EWCA Civ J0716-8
Date16 July 1998
Docket NumberCase No: QBADI 97/0857/3
CourtCourt of Appeal (Civil Division)

[1998] EWCA Civ J0716-8

IN THE SUPREME COURT OF JUDICATURE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM CLARKE, J, (QBD on 13.5.97)

Royal Courts of Justice

Strand, London, WC2A 21L

Before:

Lord Justice Stuart-Smith

Lord Justice Brooke

and

Sir Christopher Staughton

Case No: QBADI 97/0857/3

The Owners of the Ship 'Herceg Novi'
Respondent/Plaintiff
and
The Owners of the Ship 'Ming Galaxy'
Appellent/Defendant

J. Russell QC and C. Haddon-Cave (instructed by Messrs Ince & Co. for the Appellents)

N. Teare QC and L. Parsons (instructed by Messrs Holman Fenwick & Willan for the Respondents)

1

Sir Christopher Staughton
2

Sir Christopher Staughton

3

This is the judgment of the court.

4

The facts

5

On 18th August 1996 there was a collision between the HERCEG NOVI and the MING GALAXY within a traffic separation scheme in the Straits of Singapore. When this case was before Clarke J. it was originally common ground that the collision took place in Singapore waters. Then at a late stage it was submitted for HERCEG NOVI that the collision was in Indonesian waters. The judge found it unnecessary to resolve that dispute.

6

The HERCEG NOVI sank as a result of the collision. There were criminal proceedings in Singapore. The master of the MING GALAXY pleaded guilty and was fined S.$4000; the master of the HERCEG NOVI also pleaded guilty, and was fined S.$8000.

7

The owners of the HERCEG NOVI are South Cross Shipping Ltd. of Malta; the owners of the MING GALAXY are Yangming Marine Transport Corporation of Taiwan. The owners of each vessel criticise the navigation of the other. Approximate figures for their claims are, in US dollars:

The HERCEG NOVI

$10,350,000

Her cargo

4,000,000

The MING GALAXY

3.187,000

8

If those figures are substantiated, limitation of the owners' liability under the international conventions will or may arise. The limit of liability of the MING GALAXY is about $5,800,000 in this country; but it is only $2,900,000 in Singapore, where a different convention applies. So far as we know the claim of the MING GALAXY will not exceed the limit of the HERCEG NOVI under either convention. There is no suggestion that the limit will be broken under the terms of either convention on the facts of this case.

9

Naturally enough, there is a dispute as to the appropriate forum to determine those claims.

10

The Proceedings

11

On 20th August 1996, which was two days after the collision, the MING owners began Admiralty actions in rem and in personam against the HERCEG owners and their vessel in the High Court of Singapore. (To avoid confusion, we do not refer to either party as plaintiffs or defendants.) On the following day a third writ was issued in the same court by the MING owners, against the master and the third mate of the HERCEG NOVI. In a fourth action, also in the High Court of Singapore on 21st August, the MING owners sought to limit their liability against the HERCEG owners and all persons claiming to have sustained loss or damage by reason of the collision. The claim was founded on section 136 of the Merchant Shipping Act Cap. 179 of Singapore.

12

The writ in the action in rem brought by the MING owners was served, with commendable enterprise, by fixing it to the mast of the HERCEG NOVI where she had sunk, inside Singapore waters.

13

On 28th August, again with commendable dispatch, the HERCEG owners issued a writ in an Admiralty action in rem in the Queen's Bench Division against the MING GALAXY. This writ was served on a sister ship, the MING SOUTH, on 30th August at Felixstowe. On 7th November 1996 the MING owners gave notice of motion to stay the English action on the grounds that (1) England was not the appropriate forum, and (2) there were proceedings pending elsewhere, that is to say in Singapore. That application came before Clarke J. By his order made on 20th June 1997 he stayed the action pending the determination of two issues in the High Court of Singapore, as to

(1)the responsibility for the collision, and

(2)the amount of the claim of the MING owners for damages.

14

More significantly, the judge refused to grant a stay of the English action as a whole. In particular, the effect of his order was that if the MING owners wish to limit their liability in England, they will have to rely on the English statute and the higher limit which it affords. The judge gave the MING owners leave to appeal on that issue.

15

SPILIADA again

16

Clarke J. decided on the evidence that England was not the natural or appropriate forum for the trial of the action, and that Singapore was clearly and distinctly shown to be more appropriate than England. From that conclusion there has been no appeal. It followed that there ought to be a stay of the English action, unless that course would deprive the HERCEG owners of some legitimate juridical advantage so as to justify the refusal of a stay. The advantage which they rely on is, of course, the higher limit of liability prevailing here as opposed to the limit in Singapore.

17

We were referred by Mr Russell QC for the MING owners to a number of passages in Spiliada Maritime Corporation v. Cansulex Ltd. (1987) AC 460 and De Dampierre v. De Dampierre (1988) AC 92. Mr Teare for the HERCEG owners told us that there was no dispute as to the appropriate principles, but only as to how they should be applied. We can, therefore, be brief in stating what we understand those principles to be. Lord Goff of Chieveley said in the Spiliada case (at p. 482):

"The key to the solution of this problem lies, in my judgment, in the underlying fundamental principle. We have to consider where the case may be tried "suitably for the interests of all the parties and for the ends of justice"."

18

The quotation comes from the speech of Lord Shaw of Dunfermline in Société du Gaz v. Société Anonyme de Navigation Les Armateurs Français (1926) SC 13 at p. 19, where in turn it was derived from Sim v. Robinow 19 R.665, 668.

19

Turning to the application of that fundamental principle, Lord Goff observed that:

"an advantage to the plaintiff will ordinarily give rise to a comparable disadvantage to the defendant; and simply to give the plaintiff his advantage at the expense of the defendant is not consistent with the objective approach inherent in Lord Kinnear's statement of principle in Sim v. Robinow,"

20

Lord Goff then mentioned typical examples of such an advantage:

"Damages awarded on a higher scale; a more complete procedure of discovery; a power to award interest; a more generous limitation period."

21

He continued:

"Now, as a general rule, I do not think that the court should be deterred from granting a stay of proceedings … simply because the plaintiff will be deprived of such an advantage, provided that the court is satisfied that substantial justice will be done in the available appropriate forum."

22

That we take to be the sub-heading of principle for cases where there is said to be a legitimate personal or juridical advantage. It was echoed in the De Dampierre case, where Lord Goff said (at p. 110):

"the court should not as a general rule, be deterred from granting a stay of proceedings simply because the plaintiff in this country will be deprived of such an advantage, provided that the court is satisfied that substantial justice will be done in the appropriate forum overseas."

23

Lord Templeman (at p. 101) said:

"The court must consider whether in all the circumstances it is just that the plaintiff should be allowed to exploit and enforce his English advantage and should only refuse a stay if it would be unjust to confine the plaintiff to his remedies elsewhere."

24

In a later passage (p. 102) Lord Templeman agreed with the approach of Lord Goff; in our opinion he was not in any way, departing from the requirement of an objective approach or the view that a stay should be refused if substantial justice will be done in the foreign court.

25

The same theme is to be found in the speech of Lord Goff in Connelly v. RTZ Corporation plc (1997) 3 WLR 373 at p. 384.

26

Limitation of Liability

27

Section 503 of the Merchant Shipping Act 1894 provided that the owners of a ship should not be liable for (i) loss of life or personal injury, or (ii) loss or damage to goods, occurring on board their ship without their actual fault or privity, beyond the sum of £15 per ton of the ship's tonnage in case (i), and £8 per ton in case (ii).

28

By the Merchant Shipping (Liability of Shipowners and Others) Act 1958 those amounts were altered: £15 became an amount equivalent to three thousand one hundred gold francs; £8 became one thousand gold francs. Other amendments were made, including an extension of the events for which limitation was available, and also of the persons who could rely on it.

29

That Act gave effect to the ratification by the United Kingdom of the Convention Relating to the Limitation of the Liability of Owners of Seagoing Ships of 1957. The Convention was ratified or acceded to by 46 states ( Griggs, Limitation of Liability for Maritime Claims (1997) LM & CLQ 645), but others abstained; and in particular the United States stayed with their previous law which allowed limitation by abandoning the ship and freight to the claimants. The regime of the 1957 Convention became (and remains) part of the law of Singapore.

30

Now there is the Convention on Limitation for Maritime Claims 1976, which is set out in Part 1 of Schedule 7 to the Merchant Shipping Act 1995. By section 185(1) of the Act it is to have the force of law in the United Kingdom. This Convention made two important changes. First, it substantially increased the figures to which liability was limited. These are expressed in Units...

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1 firm's commentaries
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    • Singapore
    • Mondaq Singapore
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    ...22 The Reecon Wolf is an important decision as it is the first time since the English Court of Appeal decision in The Herceg Novi [1998] 2 Lloyds' Rep. 454 and Singapore's subsequent accession in 2005 to the 1976 Convention on Limitation of Maritime Claims ("the 1976 Convention") that the S......
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