The Bergen
| Jurisdiction | England & Wales |
| Judge | Clarke J |
| Judgment Date | 20 November 1996 |
| Court | Queen's Bench Division (Admiralty) |
| Date | 20 November 1996 |
Queen's Bench Division (Commercial Court).
Clarke J.
Jonathan Gaisman QC and David Edwards (instructed by Elborne Mitchell) for the plaintiffs.
Lionel Persey (instructed by Stephenson Harwood) for the defendants.
The following cases were referred to in the judgment:
Anna H, The [1994] CLC 1060.
Aratra Potato Co Ltd v Egyptian Navigation Co (“The El Amria”)UNK [1981] 2 Ll Rep 119.
Continental Bank v Aeakos Compania Naviera SAWLR [1994] 1 WLR 588.
Linda, TheUNK [1988] 1 Ll Rep 175.
Nordglimi, TheELR [1988] QB 183.
Tatry (Owners of the Cargo Lately Laden on Board the Ship) v Maciej Rataj (Owners of the Ship)ECAS (Case C-406/92) [1994] ECR I-5439; [1995] CLC 275.
Admiralty — Arrest jurisdiction — Plaintiff cargo owners invoked admiralty jurisdiction in rent by arrest — Bills of lading provided for disputes to be determined in Germany — Whether English court had to decline jurisdiction — Supreme Court Act 1981, s. 20(2), 21(4) — International Convention Relating to the Arrest of Seagoing Ships (1952), art. 7 — Civil Jurisdiction and Judgments Act 1982, Sch.1 (Brussels Convention), art. 17, 57.
In these actions the plaintiffs claimed as owners of a cargo of wood pulp which was shipped on the defendants' vessel Bergen at Wilmington in the USA.
The plaintiffs claimed in respect of alleged loss and damage to their cargo amounting to some £230,000 and in respect of their liability to salvors amounting to some DFI 665,880, all of which they alleged was caused by the defendants' breach of art. III, r. 1 and/or 2 of the Hague Rules.
The bills of lading were liner bills in the same form and evidenced contracts of carriage from Wilmington to Aberdeen in Scotland. They all incorporated the Hague Rules and contained the same jurisdiction clause which provided that disputes arising under the bills were to be decided in the country where the carrier had his principal place of business, and the law of such country should apply except as provided elsewhere in therein. The defendants were German shipowners whose principal place of business was in Germany. It followed that the parties to the contracts of carriage agreed that any dispute arising under the bills of landing would be decided in Germany under German law.
The defendants argued that the proceedings should be set aside for want of jurisdiction under art. 17 of the Brussels Convention. (An alternative issue, that the actions should be stayed under the court's inherent jurisdiction on the ground that the plaintiffs should be held to the express terms of the agreement contained in the bills of lading that disputes were to be determined in Germany, was adjourned.)
The plaintiffs argued that art. 17 had no application. It was common ground that under English domestic law the court had jurisdiction to hear and determine the plaintiffs' claims under s. 20(2) of the Supreme Court Act 1981 and that they were entitled to bring their actions in rem under s. 21(4) of the same Act. They therefore relied upon art. 57 of the Brussels Convention (as amended) and upon art. 7 of the International Convention for Unification of Certain Rules relating to the Arrest of Sea-going Ships 1952 (“the Arrest Convention”), arguing that their right to have their claims determined on the merits under art. 7 of the Arrest Convention in accordance with English domestic law was expressly preserved by art. 57 of the Brussels Convention.
Held, ruling that the court had and retained jurisdiction by reason of art. 7 of the Arrest Convention:
There was a conflict between the jurisdiction provisions of the Arrest Convention and the jurisdiction provisions of the Brussels Convention in that the effect of art. 17 of the Brussels Convention would be to deprive the English court of the jurisdiction conferred upon it by art. 7 of the Arrest Convention to determine the case on its merits if English domestic law gave it jurisdiction to do so. In the instant case the vessel was properly served and arrested in England. It followed that the English court had jurisdiction to determine the plaintiffs' claims on the merits in accordance with English domestic law. (But where there was an exclusive jurisdiction clause which provided for the determination of the dispute in a foreign court, the court had a discretion to stay the action, which it would exercise unless strong cause why it should not do so was shown.) The effect of art. 17 would be to deprive the court of any jurisdiction at all. It follows that there was a conflict between the jurisdiction provisions of the two conventions and the jurisdiction provisions of the Arrest Convention must prevail because art. 7 of the Arrest Convention was preserved by art. 57 of the Brussels Convention.
Clarke J: In these actions the plaintiffs claim as owners of a cargo of wood pulp which was shipped on the defendants' vessel Bergen at Wilmington in the USA on or before 27 December 1994. The cargo concerned in action 1995 Folio No. 70 was shipped under bill of lading No. 1 dated 27 December 1994, whereas that concerned in action 1995 Folio No. 71 was shipped under bills of lading No. 2, 3 and 4 of the same date. All the bills of lading are liner bills in the same form and evidence contracts of carriage from Wilmington to Aberdeen in Scotland. They all incorporate the Hague Rules and contain the same jurisdiction clause which is in these terms:
“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 in herein.”
The defendants are German shipowners whose principal place of business is in Germany. It follows that the parties to the contracts of carriage agreed that any dispute arising under the bills of landing would be decided in Germany under German law.
It is common ground that the plaintiffs' claims in these actions give rise to disputes which arise under the bills of landing within the meaning of cl. 3. The vessel sailed from Wilmington on or about 27 December 1994. The plaintiffs' case is pleaded as follows in para. 9–12 of the consolidated statement of claim:
“9. In the early morning of 5 January 1995, when the vessel was approximately 700 miles east of Nova Scotia, the crew observed smoke issuing from the hatch covers of the vessel's no. 2 hold and inferred that the cargo contained in the hold was on fire. Measures were taken to extinguish the fire by the introduction of carbon dioxide into the hold and the vessel continued on her voyage.
10. The vessel arrived off Falmouth on 9 January 1995 and general average was declared. The vessel was attended by HM Coastguard, the Marine Pollution Control Unit and the Cornwall County Fire Service, the last instructing that the vessel's hatches be sealed with foam.
11. On 15 January 1995, the defendants engaged salvors, under the terms of the LOF, to extinguish the fire and to escort and/or tow the vessel to Aberdeen.
12. Between 28 January and 3 February 1995, the cargo was discharged and re-stowed and certain of the cargo found to be damaged removed. The vessel thereafter proceeded to Aberdeen where the remainder of the cargo was discharged between 7 and 9 February 1995. The plaintiffs were obliged to provide and/or procure a general average bond and a general average guarantee in order to obtain delivery of the cargo.”
The plaintiffs claim in respect of alleged loss and damage to their cargo amounting to some £230,000 and in respect of their liability to the salvors amounting to some DF1 665,880, all of which they say was caused by the defendants' breach of art. III, r. 1 and/or 2 of the Hague Rules. In short it is a typical cargo claim.
The defendants rely upon...
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ENFORCING ENGLISH JURISDICTION CLAUSES IN BILLS OF LADING
...Rep 410 at [46], [47] and [71]. 125 Supra n 37. 126 See supra n 81. 127 Such as Austria. See supra n 85. 128 See egThe Bergen (No 1)[1997] 1 Lloyd’s Rep 380 for the effect of the Arrest Convention on a German jurisdiction agreement. See Gaskell, supra n 20, Section 20C7 in particular para 2......