Playa Larga (Owners of cargo lately laden on board) v I Congreso del Partido (Owners); Marble Islands (Owners of cargo lately laden on board) v I Congreso del Partido (Owners); I Congreso del Partido
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE WALLER |
| Judgment Date | 01 October 1979 |
| Judgment citation (vLex) | [1979] EWCA Civ J1001-1 |
| Docket Number | 1975 Folio 544 |
| Court | Court of Appeal (Civil Division) |
| Date | 01 October 1979 |
[1979] EWCA Civ J1001-1
The Master of the Rolls
(Lord Denning)
and
Lord Justice Waller
In The Supreme Court of Judicature
Court of Appeal
On Appeal from The High Court of Justice
Queen' Bench Division
(Mr. Justice Robert Goff)
Admiralty Actions in rem against the ship or vessel "I Congreso Del Partido"
MR. R. ALEXANDER, Q.C., MR. B. RIX, PROFESSOR HIGGEN and MISS. E. BIRCH (instructed by Messrs. Bischoff & Co.) appeared on behalf of the Plaintiffs (Appellants).
MR. T. BINGHAM, Q.C., MR. B. DAVENPORT and MR. T. SALAMON (instructed by Messrs. Coward Chance & Co.) appeared on behalf of the Defendants (Respondents).
1. THE ORGANISATION OF CUBA
The Republic of Cuba is organised on lines with which we are becoming familiar in these courts. The commerce of the country is not in private hands. It is entrusted by the government to state trading enterprises. The sugar trade is in the hands of an enterprise called Empresa Exportadora de Azucar (CUBAZUCAR). The shipping is in the hands of another called Empresa Navigacion Mambisa (MAMBISA). These state enterprises are very like the Polish state organisation ROLIMPEX which was considered by us in Garmikov v. Rolimpex (1973) 1 Queen's Bench 176, and by the House of Lords in (1978) 3 Weekly Law Reports 274. The state owns the sugar, but CUBAZUCAR buys and sells it. The state owns the ships, but MAMBISA has possession and control of them. Each of these state trading organisations must comply with the overall directions of the government: but on day-today matters each makes its own decisions about its commercial activities. Neither of them is a department of the Government of Cuba. But each is subject to the control of the government and must do as it says.
Similarly with Chile. It has a state trading enterprise which holds the majority of shares in a company called Industria Azucarera Nacional S. A. (LANSA).
2. THE CONTRACTS
In 1973, when the two countries were on very friendly terms, CUBAZUCAR of Cuba made a contract with IANSA of Chile. Under it CUBAZUCAR was to sell nearly 130,000 tons of sugar to IANSA by eight shipments of 10,000 to 20,000 tons each. It was an ordinary commercial contract. The price was U. S. $176.53per metric ton, cost and freight free out to a Chilean port. The purchasers IANSA were to open an irrevocable and confirmed letter of credit payable in Cuba. On shipping the sugar, CUBAZUCAR would take the bills of lading to the National Lank of Cuba and get payment against the shipping documents.
We are concerned here with two of the shipments of sugar. The one of 10,476 tons by a vessel called the "Playa Larga". She flew the Cuban flag. She was owned by the Republic of Cuba, but chartered to MAMBISA, who sub-chartered her by a voyage charter to CUBAZUCAR. The second of 10,890.379 tons by a vessel called "Warble Islands". She flew the Somali flag and was owned by a Liechtenstein corporation. She was under demise charter to MAMBISA, who had sub-chartered her on a voyage charter to CUBAZUCAR.
3. THE COUP D'ETAT
On the 11th September, 1973 there was a coup d'état in Chile. President Allende was killed. His government was overthrown and was replaced by a new government formed by President Pinochet. It was of a very different complexion. Prom extreme left to extreme right. The Cuban government say that there was violence specially directed at them. Their embassy was attacked. Their vessel, the "Playa Larga", was shelled. Their ambassador had to leave for his own safety. They regarded it as a major international incident. It was debated by the Security Council in the United Nations on the 17th and 13th September, 1973. The Cuban government broke off diplomatic relations with Chile. It froze all Chilean assets. It ordered its vessel to leave. On the 27th September, 1973 the Cuban government passed a law forbidding all dealings with Chile. It was "a deliberate act of International Policy" and was expressed to take effect fromthe 11th September, 1973.
4. THE SHIPS GET AWAY
On the morning of the 11th September, 1973 the "Playa Larga" had arrived in Chile and was lying at anchor in the port of Valparaiso. The Chileans had put on board four large cranes for unloading sugar. They belonged to a Chilean corporation, Compania de Refineria de Azucar de Vina del Mar (CRAV). She had already discharged part of the cargo, 2,569.305 metric tons: and had on board the remaining part, 7,907.206 metric tons, yet to discharge for delivery to LANSA. She was at anchor awaiting instructions to return to berth to complete discharging. After the coup d'état the Cuban government gave urgent instructions to the master. She weighed anchor and started to leave the port with sugar, cranes, and all. The Chileans did their best to stop her. She had no port clearance. They transmitted radio messages telling her to stop. They sent out a helicopter and a destroyer. They fired warning shots. But she got away.
The next day, on her way northwards, the "Playa Larga" met the other vessel, the "Marble Islands". She was at sea a day's journey from Valparaiso. She had on board a cargo of 10,890.329 metric tons of sugar. It was also destined for the Chilean importers, IANSA. But she also had had urgent orders from the Cuban government. Instead of going on to Valparaiso, she turned round and went northwards in company with the "Playa Larga". Together they sailed north for three days, covering 1,500 miles and then put into Callao, the port for Lima in Peru. The Chilean ambassador to Peru sent his naval attached to the vessels. He asked the captains to discharge the sugar at Callao. Both categorically refused. The Cuban ambassador made his weight felt. He gave instructions that under nocircumstances was the sugar to be unloaded in Callao.
Five days later the "Playa Larga" left Callao on her own. She made her way up the coast of South America, through the Panama Canal, across the Caribbean Sea till she reached Cuba. She discharged her cargo of sugar there on the 5th October, 1973, that is, 3½ weeks after leaving Valparaiso. The Cuban authorities took possession of the Sugar and supplied it to their own people in Cuba for their own use.
The "Marble Islands" had a more exciting time. She stayed at Callao a further week. Then she left on the 27th September, 1973 and went north, hoping to go through the Panama Canal on the way to Cuba. But when she got to Balboa at the Pacific end of the Canal, the Chilean importers IANSA got her arrested by the U. S. authorities in the Canal Zone - because of their claim to the sugar. The master was not the sort of man to submit to this interference. Nor was the Cuban government. He broke arrest, and sailed off to the west. He went on for days and days across the wide stretches of the Pacific. No doubt he put into some port for bunkers. Perhaps to Yokohama or Hong Kong. Then across the South China Sea until he reached a country friendly to Cuba. It was North Vietnam. He berthed at Haiphong, the port' for Hanoi. It was, on the 6th November, 1973, nearly six weeks after he had left Callao. At Haiphong he unloaded her cargo of sugar. The Cuban authorities presented it to the people of Vietnam as a gift. Meantime, whilst she was crossing the Pacific, on the 13th October, 1973, she had been purchased from her Liechtenstein owners by the Republic of Cuba.
5. THE OWNERSHIP OF THE SUGAR
The Chilean importers IANSA were very angry about all this. The sugar in both ships belonged to them. They hadpaid for it and got the shipping documents. They had opened letters of credit which had been honoured. The payment for the cargo on the "Playa Larga" had been made - and the documents received - on the 29th August, 1973, long before the coup d'état. They had also paid for the cargo in the "Marble Islands". Their correspondent bank in Paris had paid on the 14th September, 1973 in the belief that the documents for the "Marble Islands" had been presented by CUBAZUCAR on the 11th September, 1973, before the coup d'état.
Beyond all doubt IANSA had paid for both cargoes and CUBAZUCAR had received the payment.
The owners of the four large cranes, the Chilean corporation CRAV, were equally angry. They had lost their cranes beyond recall.
6. THE ART EST OF THE "IMIAS"
The Chileans then discovered that the "Imias", a vessel owned by the Cuban government (and run by MAMBISA), was passing through the Panama Canal Zone. The Chilean importers and crane owners determined to get her. They issued writs in the U. S. Canal Zone District Court against MAMBISA claiming more than $4 million. They served the "Imias" with a writ of foreign attachment and arrested her. The Cuban government claimed her release on the ground of sovereign immunity. The U. S. Department of State conceded it, whereupon the District Court allowed her to go free, see Spacil v. Crowe (1974) 489 Federal Cases, 2nd 614. A well-informed commentator suggests that "diplomatic and political considerations were deemed to be of overriding importance", see Professor Monroe Leigh, "The Case of the 'Imias'" (1974) AjIL Vol. 63 pages 280-239.
7. THE ARBETRATION
In November 1974 IANSA commenced arbitration proceedings against CUBAZUCAR before the Sugar Association in London. They were so protracted that an award was not made until the 18th April, 1978. The arbitrators then made an award in the form of a Special Case. It has not yet come before the court for Decision.
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