A/S D/S Svendborg v Wansa (trading as Melborne Enterprises)
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE STAUGHTON,LORD JUSTICE WAITE,LORD JUSTICE ALDOUS |
| Judgment Date | 16 April 1997 |
| Judgment citation (vLex) | [1997] EWCA Civ J0416-9 |
| Docket Number | QBCMI 96/1470/B |
| Court | Court of Appeal (Civil Division) |
| Date | 16 April 1997 |
[1997] EWCA Civ J0416-9
Lord Justice Staughton
Lord Justice Waite
Lord Justice Aldous
QBCMI 96/1470/B
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN'S BENCH DIVISION
(Mr Justice Clarke)
Royal Courts of Justice
Strand
London WC2
MR VERNON FLYNN (Instructed by Ince & Co, London EC3R SEN) appeared on behalf of the Appellant
MR GRAHAM DUNNING (Instructed by Stephenson Harwood, London EC4M 85H) appeared on behalf of the Respondent
Wednesday 16th April, 1997
These proceedings are brought by two shipowning concerns against Mr Mohamed Kamel Wansa. In the first action the Plaintiffs are Maersk Line, which is the trading name of two Danish companies, and the Defendant is Mr Wansa trading as Melborne Enterprises. That I will call the Melborne action. In the second, called the Estonian action, the Plaintiffs are Estonian Shipping Co Ltd and the Defendant is Mr Wansa trading as D & M Impex. Mr Wansa is now the Appellant in both appeals, and the shipowners are the Respondents.
On 12th January 1996 Clarke J. made prior restraint orders against Mr Wansa in respect of his assets worldwide up to a total of $671,581 in the Melborne action and $1,271,723 in the Estonian action. He also granted injunctions ordering Mr Wansa not to continue proceedings which he had commenced against both shipowners in Sierra Leone. There was a third action with which the judge was also concerned, but that does not feature before us.
Mr Wansa was in England on 12th January 1996, and was personally served with the writs and the orders of Clarke J. in all three actions. An application was made in February on his behalf to Clarke J. for an order that the English proceedings be set aside or stayed and the injunctions and prior restraint orders also set aside. The application was refused in both cases; and Mr Wansa appeals to this court against those orders.
The primary facts: (i) The Melborne case
In February 1992 a container loaded with bales of textiles was loaded on the ESTHER SCHULTE at Banjul in the Gambia for carriage to Freetown in Sierra Leone. Maersk Line were the contractual carriers; their bill of lading contained this clause:
Wherever the Carriage of Goods by Sea Act 1936 (COGSA) of the United States of America applies…this contract is to be governed by United States law and the United States Federal Court Southern District of New York is to have exclusive jurisdiction to hear all disputes hereunder. In all other cases, this Bill of Lading is subject to English law and jurisdiction.
Mr Wansa claims to have bought the goods from the shippers, and that there was a shortage of 82 bales of textiles when the container was opened at Freetown. The shortage is disputed. On 11th May 1993 Mr Wansa issued a writ against Maersk Line and others claiming damages in the sum of $111,529.95, together with interest at 36 per cent per annum.
(ii) The Estonian case
In March and April 1993 cement in bags was shipped at Tallin for carriage to Freetown on board the PARILA and the PALDISKI, both vessels owned by Estonian Shipping Co Ltd. The bills of lading each contained this clause:
3. Jurisdiction
Any dispute arising under this Bill of Lading shall be decided in the country where the carrier has his principal place of business, and the law of such country shall apply except as provided elsewhere herein.
Claims for shortage and damage were presented on behalf of the government of Sierra Leone to Sun Alliance, insurers of the cargo for the voyage. Those claims were settled for £8161.02 in one case and $2587.46 in the other. Subrogation forms were executed by the Crown Agents on behalf of the government of Sierra Leone, which presumably were designed to transfer the government's rights against the carrier (if any) to the insurers; and Sun Alliance presented claims under the bills of lading to the shipowners.
Then what appeared to be a different version of the same claim was made by Mr Wansa. He issued a writ against Estonian Shipping Co Ltd in Sierra Leone. The claim was for 24,714 bags lost or damaged on the PARILA (two fifths of the cargo) and 23941 bags (nearly the same proportion) on the PALDISKI. The claim was based on an alleged market value of $7.10 per bag, as opposed to the figure of $4.10 per bag for which the cargo was insured, and amounted to $348,479.44. It is disputed.
The Jurisdiction Clauses
In the Melborne case, there is an issue as to whether the clause in the bill of lading conferred exclusive jurisdiction on the English courts, and whether the commencement of an action in Sierra Leone was a breach of contract. It can be argued that the express mention of exclusive jurisdiction in the first part of the clause excludes any implication that the second part provides for exclusive jurisdiction. On the other hand it can be argued that the author wished to provide for exclusive jurisdiction throughout, and did not think it necessary to repeat the word "exclusive" in the second part. It was conceded in the court below that it was "at least strongly arguable" that the clause conferred exclusive jurisdiction on the English courts.
Mr Rokison, for Mr Wansa, urged us to decide the point, and not to be content with what is strongly arguable. I am prepared to accept the invitation, although that does not help Mr Rokison. I conclude that the clause does confer exclusive jurisdiction on the English courts. My reasons are in substance, first those which I stated in Sohio Supply Co v. Gatoil (USA) Inc (1989) 1 Ll R 588 at pp. 591-2, and in particular that I could think of no reason why businessmen should choose to go to the trouble of saying that the English Courts should have non-exclusive jurisdiction. My second reason is that the parties in the second part of the clause were plainly saying that English law was to be mandatory if the American Carriage of Goods by Sea Act did not apply; it seems to me that they must have intended English jurisdiction likewise to be mandatory in that event.
The Estonian bills of lading do not provide for English jurisdiction; in effect they say that any dispute arising under them shall be decided in the courts of Estonia. It follows that there was a breach of contract by Mr Wansa in commencing proceedings in Sierra Leone. But he contends that the shipowners are also in breach, because they have started an action in England. Against that it is argued for the shipowners that their English action is not a dispute "under the bill of lading". I do not find that argument at all plausible, in view of the wide meaning that has been given to such words, for example in arbitration cases. So I am prepared to assume that the shipowners were in breach of contract, by commencing proceedings against Mr Wansa in England. But that does not mean that we are obliged to stay the Estonian action. The English courts, like those of many other countries, do not regard themselves as bound in all circumstances to comply with a private contract which seeks to deprive them of jurisdiction: see for example The El Amria (1981) 2 Ll R 119.
The Sierra Leone proceedings: (i) The Melborne case
A full history of these proceedings is set out in the judgment of Clarke J., (1996) 2 Ll Rep 559 at pp. 570-571. What follows is an abridged version.
The writ, as I have said, was issued in Sierra Leone on 11th May 1993. On 24th June Maersk Line entered an appearance under protest, and on 5th July they issued a notice of motion seeking a stay in reliance on the English jurisdiction clause. There was an exchange of affidavits, in which Mr Wansa's shortage claim was disputed by Mr Ghirardani, an English solicitor acting for Maersk Line. He did not assert at that stage that there was a history of fraudulent cargo claims being made in Sierra Leone. Indeed he did not, as Mr Rokison pointed out on several occasions, say in terms that the claim in question was fraudulent.
On 25th April 1994 Ademosu J, directing himself in accordance with The El Amria, refused a stay. On 3rd May Maersk Line filed a notice of motion seeking leave to appeal and a stay of the action. This, it seems, was not served. On 11th May the lawyer acting for Mr Wansa searched the registry for a defence; none had been filed, and he entered judgment for the resale value of the goods damaged or short delivered, to be assessed, and interest on that amount at the rate of 36 per cent per annum.
Some further attempts by Maersk Line to obtain leave to appeal and a stay followed. Then at the beginning of June or thereabouts they changed their legal advisers in Sierra Leone. What happened next was described by Clarke J. as follows:
Once Mr Macauley came on the scene no further attempts were made to seek leave to appeal from the Judge's refusal of a stay of the action. Instead the plaintiffs filed a notice of motion dated June 4, in which they sought to set aside the judgment on the grounds, inter alia, that the defendant was not entitled to sign judgment for 36 per cent. per annum interest, and that the plaintiffs had a defence on the merits. An affidavit was sworn in support, exhibiting a draft proposed defence. Paragraph 8 of the affidavit includes the statement that the plaintiffs -
have advised themselves to apply for leave to defend the claim on the merits. The reason given for not serving a defence earlier was that a challenge to the jurisdiction was being made.
Nothing more was heard of the application for leave to appeal, and the only reasonable inference is that at that time it was decided to seek to defend the claim on the merits.
Once again Maersk Line did not...
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