The Mouna
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE GLIDEWELL |
| Judgment Date | 07 May 1991 |
| Judgment citation (vLex) | [1991] EWCA Civ J0430-1 |
| Date | 07 May 1991 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 91/0430 |
[1991] EWCA Civ J0430-1
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMIRALTY COURT
(MR JUSTICE SHEEN)
Royal Courts of Justice
Lord Justice Glidewell
and
Mrs Justice Bracewell
91/0430
MR CHARLES SUSSEX, instructed by Messrs Young & Co., appeared for the Appellants (Defendants).
MR JONATHAN GAISMAN, instructed by Messrs Birkett Westhorp and Long (Felixstowe, Suffolk), appeared for the Respondents (Plaintiffs).
This is an appeal, with leave granted by Lord Justice Lloyd, against a decision of Mr Justice Sheen given on 22nd March 1990 refusing the defendants' application to set aside an order made on 6th October 1989 extending the validity of the writ in this action for 12 months from that date. The writ was issued on 5th October 1988 and it expired on 4th October 1989. The order of 6th October was therefore made two days outside that time limit. It was, of course, made on an ex parte application. The writ was served on the defendants' solicitors on 19th October 1989. The defendants took out their summons to set aside on 21st December 1989.
The background to the matter is as follows. The defendants are the owners of a vessel called the "Mouna" which was chartered in October 1987 to a French company to carry a cargo of wheat from La Pallice in France to Ipswich. The bill of lading is dated 17th October 1987. The plaintiffs had purchased the wheat from the French company by a contract dated 17th August 1987 and had resold it. The plaintiffs' claim was that the cargo was damaged by water during the voyage and that this damage was apparent upon discharge of the cargo at Ipswich. They contend that the damage was caused by sea water getting in through the hatch covers which they also contend were defective. Solicitors were instructed to act on behalf of the plaintiffs, the partner in the firm who was dealing with the matter being Sir Ian Collett.
The action itself was an action in rem. Obviously a writ cannot be served on the vessel itself unless it is within the jurisdiction, and so Sir Ian obtained an undertaking from the shipowners' P & I Club in the following terms by a letter dated 26th October 1987 addressed to the owners of the cargo c/o the solicitors:
"In consideration of your consenting to the release from arrest and/or refraining from taking action resulting in the arrest of the above-named ship…we hereby undertake to pay to you or your order on demand such sums as may be adjudged by the English High Court of Justice or other competent Tribunal or as may be agreed to be recoverable from the Owners of the above-named ship in respect of the said claim, interest and costs provided that the total of our liability hereunder shall not exceed the sum of eighty thousand pounds plus interest and costs.
and for the consideration aforesaid: (1) we warrant that we are informed by the Owners of the above-named ship that the said ship was not demised chartered at any material time: (2) we undertake that we will within 14 days of the receipt from you or your solicitors of a request so to do, instruct solicitors to accept on behalf of the Owners of the above-named ship service of proceedings brought by you in the English High Court of Justice and to acknowledge service thereof, without prejudice to any application which may be made to the Court for a stay of the proceedings: and (3) we warrant that we have received irrevocable authority from the Owners of the above-named ship to instruct solicitors in accordance with (2) above.
This undertaking shall be governed by and construed in accordance with English Law."
The effect of the second of those undertakings was, of course, that if or when the stage was reached that the plaintiffs' solicitors wished to serve the writ by the method to which the undertaking referred—that is to say, by service on solicitors appointed on behalf of the defendants—they had to make a request with which the P & I Club undertook to comply within 14 days. In other words there was an added 14 days within which the P & I Club had to comply with their undertaking.
Under Article 3(6) of the Hague Visby Rules which are incorporated into and form the Schedule to the Carriage of Goods by Sea Act 1971 so far as is material:
"The carrier and the ship shall in any event be discharged from all liability whatsoever in respect of the goods unless suit is brought within one year of their delivery or of the date when they should have been delivered. This period may, however, be extended if the parties so agree after the cause of action has arisen."
That period of one year did expire on 21st October 1988, being 12 months after the goods were delivered at Ipswich. After obtaining the undertaking from the shipowners' P & I Club effectively there was no further correspondence in the matter for very nearly a year. However, on 28th September 1988 the plaintiffs' solicitors wrote to the P & I Club, saying:
"We refer to previous correspondence on this matter and in particular, the letter of undertaking provided by you and dated 26th October 1987.
We have now received our Clients' instructions to advance a claim for the Recovery of the damage sustained to this consignment of milling wheat at Ipswich on the above mentioned date.
We are issuing a Writ in Rem to preserve the time limit which expires on the 21st October 1988. We shall within the next few weeks be letting you have full particulars of the claim and supporting documentation in the hope that the claim can be resolved amicably.
In the event, however, that you wish to instruct solicitors at this stage, would you kindly advise us of their identity and whether they have instructions from you to accept service of any proceedings that may be issued."
It should be noted that the last sentence was not a direct request that solicitors should be instructed to accept service. It was an enquiry whether the P & I Club wished to instruct solicitors.
The answer came in a telex from the P & I Club on 5th October 1988 which says:
"We suggest you submit claim documents for now direct to us for consideration without prejudice."
The writ was issued the same day, but it was not served. There followed, over the next year, correspondence to which I shall return. But before I do, it is necessary to refer to the provision of the rules under which the application to renew the writ was made. In this respect the Rules of the Supreme Court have been materially altered since the relevant date, since the time limit has been drastically reduced. But the rule which was in force in 1989 was Order 6, rule 8, which provided firstly that the writ was valid in the first instance for 12 months beginning with the date of its issue. Sub-rule (2) provided:
"Where a writ has not been served on a defendant, the Court may by order extend the validity of the writ from time to time for such period, not exceeding twelve months at any one time, beginning with the day next following that on which it would otherwise expire, as may be specified in the order, if an application for extension is made to the Court before that day or such later day (if any) as the Court may allow."
As I have already said, an ex parte application to extend the validity of the writ was made and granted on 6th October 1989, supported by an affidavit sworn by Sir Ian Collett. The writ was finally served on 19th October 1989. The defendants' application made on 21st December 1989 to set aside that order and set aside the service of the writ was refused by Mr Justice Sheen on 21st December, and it is against that refusal that the defendants now appeal.
Now I return to the correspondence. I have already read the brief telex from the P & I Club of 5th October 1988, but it is perhaps helpful to re-read it since it is so short:
"We suggest you submit claim documents for now direct to us for consideration without prejudice."
Mr Gaisman, for the plaintiffs, submits that that brief phrase amounts to an unequivocal representation that the defendants would not object to the writ not being served until such time as negotiations between the parties had clearly either failed or in some other way had reached finality.
In my view, it is impossible to read so much into that one sentence. The phrase "for now" clearly meant "we suggest you do not take any further steps for the time being". I accept that the phrase "for the time being" is itself somewhat vague, but clearly it does not mean forever; nor do I think that one can read in a representation that if the time comes when the writ under the rules should be served the defendants will agree to that time limit being waived or renewed.
I am confirmed in that view of the meaning of the telex because I believe that the plaintiffs' solicitors themselves understood it in that sense at that time. The reply to the telex was a letter from the plaintiffs' solicitors of 10th October 1988. It gave some detail relating to the dispute and the plaintiffs' claim, and it concluded with this paragraph:
"We look forward to hearing from you once you have had the opportunity of considering this claim with your surveyor. In the meantime, given the proximity of the limitation period, we have issued a Writ which we shall refrain from serving for the time being."
If the plaintiffs' solicitors had thought at that stage that the defendants were agreeing that the writ need not be served until such time as negotiations had failed, it would have been simplicity itself to put some such phrase in the letter, but it is...
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