Bredero Price (Malaysia) Sdn BHD v Scheepvaartonderneming LEIDSEGRACHT CV

[2000] WASC 263

BREDERO PRICE (MALAYSIA) SDN BHD -v- SCHEEPVAARTONDERNEMING LEIDSEGRACHT CV & ANOR [2000] WASC 263

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2000] WASC 263
Case No:	CIV:1605/1997	Heard:	12 OCTOBER 2000
Coram:	MASTER BREDMEYER	Delivered:	27/10/00
No of pages:	8	Judgment Part:	1 of 1
Result:	Application dismissed
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Parties:	BREDERO PRICE (MALAYSIA) SDN BHD SCHEEPVAARTONDERNEMING LEIDSEGRACHT CV SCHEEPVAARTONDERNEMING ACHTERGRACHT CV
Catchwords:	Pleading Application for leave to amend Relevance of sea-freighting contract and charterparty
Legislation:	Nil
Case References:	Astley & Ors v Austrust Ltd (1999) 161 ALR 155 Commonwealth v Verwayen (1990) 170 CLR 394 Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323 Atkinson v Fitzwalter [1987] 1 All ER 483 Hooker Corporation Ltd v The Commonwealth (1986) 65 ACTR 32

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : BREDERO PRICE (MALAYSIA) SDN BHD -v- SCHEEPVAARTONDERNEMING LEIDSEGRACHT CV & ANOR [2000] WASC 263 CORAM : MASTER BREDMEYER HEARD : 12 OCTOBER 2000 DELIVERED : 27 OCTOBER 2000 FILE NO/S : CIV 1605 of 1997 BETWEEN : BREDERO PRICE (MALAYSIA) SDN BHD

Plaintiff

AND

SCHEEPVAARTONDERNEMING LEIDSEGRACHT CV
SCHEEPVAARTONDERNEMING ACHTERGRACHT CV
Defendants

Catchwords:

Pleading - Application for leave to amend - Relevance of sea-freighting contract and charterparty

Legislation:

Nil

Result:

Application dismissed

(Page 2)

Representation:

Counsel:

Plaintiff : Mr G I Macnish
Defendants : Mr K J Martin QC

Solicitors:

Plaintiff : Cocks Macnish & Co
Defendants : Jackson McDonald

Case(s) referred to in judgment(s):

Astley & Ors v Austrust Ltd (1999) 161 ALR 155
Commonwealth v Verwayen (1990) 170 CLR 394
Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146
Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323

Case(s) also cited:

Atkinson v Fitzwalter [1987] 1 All ER 483
Hooker Corporation Ltd v The Commonwealth (1986) 65 ACTR 32

(Page 3)

1 MASTER BREDMEYER: This is an application by the defendants to amend their defence in terms of a minute of proposed amended defence of 27 June 2000 ("the minute"). The main purpose of the amendment is to introduce two documents upon which the defendants wish to mount defences and which documents are not mentioned by the plaintiff in the statement of claim. The documents are:

(1) A Sea-Freighting Contract dated 9 May 1996 between Bredero Price (Malaysia) Sdn Bhd between the plaintiff in this action, described in the contract as "the merchants", and Trans Global Projects Sdn Bhd Malaysia ("Trans Global") described as "the carrier".

(2) A charterparty dated 14 May 1996 between Trans Global as charterer and Spliethoff's of Amsterdam (which I understand is an agent for the defendants) as owner. This is a charter of the defendants' vessel the "MV Achtergracht" for a journey from Kuantan to Port Hedland and Dampier.

2 The plaintiff was the shipper of some steel pipes from Kuantan to Port Hedland and Dampier in the defendants' vessel "MV Achtergracht" in May and June 1996. The plaintiff says that those pipes were damaged on arrival at those ports. The plaintiff, the shipper of the pipes, has sued the defendant, the carrier, under two bills of lading dated 28 May 1996. Those bills of lading incorporate The Hague/Visby Rules. The two bills are in identical form, except that one cites Dampier as the port of discharge and the other Port Hedland. In each case there is a reference in the bill to another document: "Freight payable at AS PER CHARTER PARTY." (The latter four words have been typed onto the printed form.)

3 The plaintiff has sued the defendants, the carrier, for breach of contract, namely, in the negligent handling of the cargo resulting in the damaged goods. The plaintiff has also sued the defendants in two common law actions - for breach of its duty as a bailee for reward, and for negligence.

4 Under the Sea-Freighting Contract, Trans Global, described as the carrier in that contract, undertook to ship certain pipes for the plaintiff from Kuantan, Malaysia to Port Hedland and Dampier in the vessel "MV Achtergracht" at a price of US$62.50 per revenue tonne. The Contract has a clause headed "Bills of Lading" and part of that clause reads as follows:

(Page 4)

"Bills of Lading shall be subject to and incorporate all terms, conditions and exceptions of this contract and if there is any conflict between the Bills of Lading and this contract the provisions of this contract are to govern."

The Contract also has a clause headed "Subcontractors" which reads:

"Carrier shall submit list of all proposed subcontractors for Merchant's approval, at least 10 days prior to ETA of ship at load port."

Under the heading "Specifications", these words appear:

"Carrier shall fully comply to Addendum A - Pipe Handling and Stowage Requirements."

Annexed to the Contract is Addendum A, the pipe handling and stowage requirements, which impose on the carrier, ie Trans Global, certain requirements for the safe handling and stowage of the pipes. For example:

"Properly folded gummy sacks shall be placed between the pipes at the bottom tiers in order to achieve tight stowage as well as to ensure proper nesting of the subsequently stowed pipes."

5 The defendants seek to rely on the terms of the Sea-Freighting Contract in the minute and here I summarise parts of the defendants' minute:

2(e) It was an express term of the Sea-Freighting Contract that the bills of lading shall be subject to and incorporate all the terms, conditions and exceptions of the Sea-Freighting Contract and if there is any conflict between the bills of lading and the Sea-Freighting Contract the provisions of the latter are to govern.

(f) and (g) It was an express term of the Sea-Freighting Contract that Trans Global would submit a list of proposed subcontractors to the plaintiff for approval 10 days prior to the ETA of the vessel and this was, in effect, done and so the defendants became a subcontractor of Trans Global.

(h) It was an express term of the Sea Freighting Contract that Trans Global would fully comply with Addendum A - Pipe Handling and Stowage Requirements.

(Page 5)

(i) The defendants were never informed by Trans Global of those requirements.

I also summarise pars 7.2, 11(c) and 11(d):

It was the responsibility of Trans Global as the plaintiffs' nominated carrier, and not the defendants, to attend to the stowage requirements of the cargo in accordance with Addendum A.

6 I fail to see how any of this amounts to an arguable defence. The defendants are not a party to the Sea-Freighting Contract and cannot, in my view, gain any benefit from it. If Trans Global are also liable to the plaintiff for negligence, the defendants can join it as a co-defendant. The terms of the Sea-Freighting Contract only prevail over conflicting terms of the bill of lading where the carrier issued the bill of lading. Here it did not. I cite authority for that in connection with the charterparty discussed below.

7 I now turn to the references in the minute to the second document, the charterparty of 14 May 1996. It is said that under the terms of the Sea-Freighting Contract, Trans Global, as nominated carrier, could submit a list of proposed subcontractors to the plaintiff for approval. This was done. As a result of that, the defendants entered into the voyage charterparty with Trans Global. Clause 20 of the charterparty describes the pipes and then states:

"Deck loading not allowed:

Pipes normal saddle stow with gunny sack separation."

Clause 32 of the charterparty reads:

"In case named bill of lading should not be available at discharge ports on vessel's arrival, owners agree to discharge entire cargo against single letter of indemnity in owner's P and I club standard wording duly signed by charterers and on the bill of lading named shippers. BS/L shall be subject to and incorporate all terms, conditions and exceptions of this contract if there is any conflict between bills of lading and this contract the provisions of this contract are to govern."

8 By virtue of this clause it is pleaded in the minute that the terms of the charterparty were paramount over any of the terms of the bills of lading, and that by virtue of that provision it was the responsibility of the charterer, Trans Global, to stow the pipes (by cl 20) with "normal saddle

(Page 6)

stow with gunny sack separation" and (by cl 22) for the loading, stowing, securing, lashing, dunnaging and tallying in of the cargo in Kuantan".

9 I consider it arguable that the defendants are Trans Global's subcontractors, but that of itself does not produce a contractual relationship between the plaintiff and the defendants via the Sea-freighting Contract and the charterparty. On the same argument, if a principal engages a builder and the builder engages a subcontractor, the principal cannot sue the subcontractor. The plaintiff is not a party to the charterparty and cannot sue on it. It does not seek to do so. Nor can the defendants rely on any term in the charterparty as a defence to the plaintiff's suit. The defendants entered into a contract directly with the plaintiff, namely the bills of lading. The bills say, as I have mentioned, that the freight is payable "as per charterparty" (ie USD 54.75 per metric ton) but do not incorporate any other terms of the charterparty. The express inclusion of one term means the exclusion of the others.

10 Clause 32 of the charterparty has no effect in this case. If the parties to the charterparty and the bills of lading were the same, it would apply. But as they are not the same, it does not. The charterer could have issued the bills of lading. Clause 21 of the charterparty contemplates that; it refers to "charterparty bills of lading". The charterer did not do so. If it had done so, then by cl 32 the terms of the charterparty would prevail over any conflicting terms in the bills. I quote from Payne and Ivamy's, "Carriage of Goods by Sea" 11th ed at 63:

"Where the charterer is also the shipper, the rights of ship owner and charterer as such will be governed by the charter party alone. The bill of lading cannot vary or add to the terms of the charter party unless it contains an express provision to that effect.

But where the charterer puts the ship up as a general ship, the contract of carriage will in each case be evidenced by the bill of lading given to each shipper, irrespective of the terms of the charter party, except where there is an express agreement to the contrary."

I also quote from Tetley, "Marine Cargo Claims" 3rd ed at 36:

"A bill of lading in the hands of a person not a party to the charterparty is the document regulating the relations between the holder and the carrier. When the holder of the bill of lading is also the charterer, then the charter party is really the contract

(Page 7)

of transportation and the bill of lading is only receipt and the [Hague/Visby] Rules do not apply."

11 In this case, because the charterer and the holder of the bills of lading are different, the terms of the charterparty do not prevail over the bills of lading and thus the defendants cannot rely on possible breaches of cl 20 and cl 22 of the charterparty relating to correct stowage by Trans Global. Those terms are not relevant to the plaintiff's contract with the defendant, namely, the bills of lading. Those terms could be relied on if Trans Global sued the defendants for the damaged pipes.

12 I consider that no use can be made of the Sea-Freighting Contract or the charterparty by the defendants in a defence to the plaintiff's breach of contract claim. No use can be made in any other context of the charterparty. However, I consider the defendants can make some use of the Sea-Freighting Contract in their plea of contributory negligence to the plaintiff's claims against the defendant for breach of duty as bailee and for negligence. Contributory negligence can be a complete or partial defence to those claims, whereas since Astley & Ors v Austrust Ltd (1999) 161 ALR 155, contributory negligence cannot be a defence to a contract claim. In relation to bailment and common law negligence it could be pleaded that the plaintiff was guilty of contributory negligence. The plaintiff knew of the proper way to stow the pipes safely, it entered into the Sea-Freighting Contract with Trans Global imposing obligations on Trans Global to stow the pipes in detailed and safe ways. The plaintiff took no steps to ensure compliance with those provisions and hence contributed to its own loss.

13 I will not give leave to the defendants to amend their defence in the form of the minute. It needs to be amended to give effect to these reasons. The plaintiff objects to par 16.1 and par 16.2 of the minute in which the defendant relies on par 23 of each bill of lading which requires the plaintiff to notify particulars of damage within 30 days of that damage occurring. It has pleaded that this was not done and the plaintiff says that this amendment should not be allowed because the amendment is late and relies on Commonwealth v Verwayen (1990) 170 CLR 394 at 456, 464 and 482 and Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323 at 324 and 338 - 339. In the light of the later and higher authority of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 at 154 it would not be just to refuse these amendments on the ground of lateness. No promise was made that this time-limit point would not be taken. Hence no estoppel is raised. This is not a case which has been

(Page 8)

entered for trial or, of course, listed for trial. I consider it most unjust to refuse these amendments.

14 The application for leave to amend the defence in terms of the minute will be dismissed. I will give leave to the defendants to produce a further minute of the pleading within a stipulated time. I will hear the parties on costs.