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[2007] ZASCA 12
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Mediterranean Shipping Company (Pty) Ltd. v Tebe Trading (Pty) Ltd. [MSC Spain] (204/06) [2007] ZASCA 12; [2007] SCA 12 (RSA); 2008 (6) SA 595 (SCA) ; [2007] 2 All SA 489 (SCA) (20 March 2007)
Links to summary
THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
Reportable
Case no: 204/06
NAME OF SHIP: mv â
MSC SPAIN
â
In the
matter between:
MEDITERRANEAN
SHIPPING COMPANY (PTY) LIMITED
......................
APPELLANT
and
TEBE
TRADING (PTY) LIMITED
......................
RESPONDENT
________________________________________________________________
CORAM: SCOTT, FARLAM, CLOETE, LEWIS
et
CACHALIA
JJA
DATE OF HEARING: 16 February 2007
DATE OF DELIVERY: 20 March 2007
Summary
: Delict â
agent of carrier and shipping line has no legal duty to inform
shipper (or consignee) of proposed deviation so as to
afford shipper
the opportunity of removing perishable cargo from ship if bill of
lading permits such deviation.
Neutral citation:
This
judgment may be referred to as
MSC
Spain
[2007] SCA 12 RSA
________________________________________________________________
JUDGMENT
________________________________________________________________
SCOTT JA/â¦..
SCOTT JA:
[1] This is an appeal, with special leave, from the judgment of the
full court of the Pietermaritzburg High Court exercising its
admiralty jurisdiction which upheld an appeal from a decision of
Combrinck J, who had absolved the defendant, now the appellant,
from
the instance. The judgment of the full court is reported at
2006 (4)
SA 495
(N). The case concerns two containers of litchis shipped on
board the vessel,
MSC Spain
, at Durban for carriage, one, to
Jebel Ali, Dubai, the other, to Damman, Saudi Arabia, pursuant to the
terms of two bills of lading.
The shipper was the respondent, a
company which carries on business at Durban as an exporter
inter
alia
of perishable fresh fruit to the Middle East. I shall refer
to it as Tebe. The bills of lading were issued by the appellant as
agent
for the carrier, being the owner of the vessel. On arrival at
the ports of discharge the litchis were found to have deteriorated
in
consequence of a delay in the completion of the voyage. Tebe sued the
appellant both in contract and delict. The claim in contract
was
misconceived; the appellant acted at all times as an agent. The claim
in delict was founded upon the alleged negligent failure
of the
appellant to advise Tebe of a delay in the commencement of the voyage
and a change in the proposed route of the vessel to
the ports of
discharge.
[2] The appellant is a South African company. Its business is that of
shipsâ agent in South Africa for the Geneva registered company,
Mediterranean Shipping Company SA (hereinafter referred to as âMSC
Genevaâ). The latter operates a large and well-known fleet.
It owns
some of the vessels in the fleet; others it operates in pursuance of
time charters. The relationship between the appellant
and MSC Geneva
is governed by a written agency agreement, a copy of which was
admitted in evidence. The appellantâs duties as agent
include
typically the acceptance of bookings and the marketing of its
principalâs services. It is also authorised âto issue,
sign and
stampâ bills of lading on behalf of its principal âand/or the
Masterâ.
[3] The
MSC Spain
was on time charter. Rider clause 66 of the
charter party reads:
â
The Master, Charterers and/or
their agents are hereby authorized by Owners to sign on Mastersâ
and/or Ownersâ behalf Bills of
Lading as presented without
prejudice to this Charter Party . . . . â
It was in terms of this clause that the appellant acted directly as
the ownerâs (ie the carrierâs) agent in issuing the bills
of
lading.
[4] At the commencement of the trial, the judge, as requested by the
parties, ordered that certain issues be decided first and that
the
remaining issues stand over for later determination. Those to be
decided, shortly stated, were the following:
(1) Did Tebe have
locus standi
to sue, whether in contract or
delict, for damages arising out of the loss of the consignment of
litchis?
(2) Did the appellant contract with Tebe as principal or as agent
and, if as principal, what were the terms of the contract?
(3) Is the appellant liable to Tebe in delict for damages by reason
of the formerâs negligent failure to inform Tebe that:
â
(a) the estimated date of departure of the
MSC
Spain
. . . from Durban to Jebel Ali
was delayed; and
(b) the route of the vessel from Durban to Jebel Ali was
changed?â
(4) Can the appellant rely on the Himalaya clause
1
in the bills of lading and if so, is it excused from all liability?
[5] The trial court found for the appellant on the issue of Tebeâs
locus standi
and granted absolution from the instance. It
decided none of the other issues referred to above. Tebeâs appeal
to the full court
was successful. The latter court held that Tebeâs
locus standi
had been established. It held further that the
appellant was liable to Tebe in delict for any damages it may have
suffered in consequence
of the appellantâs failure to inform Tebe
of the vesselâs change of route and that the appellant was not
protected from such
liability by the Himalaya clause in the bills of
lading. The only issue on which Tebe was unsuccessful was the second
issue listed
above. In this regard, it appears that Tebeâs claim
was initially prosecuted on the incorrect assumption that the
appellant and
MSC Geneva were one and the same entity and that that
entity was the carrier with whom Tebe had contracted. In view of the
provisions
of the bills of lading, to which I shall refer later, this
would have precluded any claim in delict. But, as indicated above, it
is quite clear on the evidence that the appellant was at all times
acting as agent for MSC Geneva or the owners of the vessel.
[6] It is necessary at this stage to record the events leading up to
the conclusion of the contracts of carriage, evidenced as they
were
by the bills of lading, and the circumstances in which the vessel
came to be delayed and her route to the Middle East altered.
[7] The normal route followed by MSC Genevaâs vessels from Durban
to Dubai is via the East African ports of Dar-es-Salaam and Mombasa,
then the ports of Mumbai and Karachi, and thereafter to Dubai. The
voyage takes about 21 to 25 days. Tebe had previously shipped
consignments of fruit on MSC Geneva vessels to the Middle East but
had ceased to do so in favour of other shipping lines which followed
a more direct route and completed the voyage in about 15 days.
Although litchis were packed in reefer (refrigeration) containers,
time remained of critical importance because of their perishable
nature. In about November 2001 the appellant received instructions
from MSC Geneva to secure cargo for a special voyage of the
MSC
Spain
from Durban, via the island of Reunion, to Dubai where the
vessel was due to go off hire. The voyage would take between 12 and
14
days and the estimated date of departure was 6 December 2001. On
26 November 2001 the appellantâs assistant trade manager, Mr
Roshand
Premchund, approached Mr Mahomed Jangda, who is Tebeâs
operations director, with a view to procuring cargo for the
MSC
Spain
âs voyage. Jangda considered the timing to be perfect.
Eid, which was preceded by 30 days of fasting, fell on 15 December
that year
and would be followed by 10 days of celebration. A
consignment of litchis which arrived in Dubai on about 18 or 20
December would
therefore be readily marketable. Jangda accordingly
arranged with his supplier in Malelane (who traded under the name of
Laughing
Waters) to dispatch a consignment of litchis to Durban. He
also arranged with his forwarding agents, WSS Africa, to make the
necessary
booking, which the latter did on the same day, namely 26
November 2001.
[8] The litchis arrived in Durban on 2 December 2001. They were
placed in cold storage to cool to the appropriate temperature and
then packed into two containers. The containers were moved to the
container terminal on 6 and 8 December, respectively, where they
remained until the port authorities authorised them to be moved to
the âstackâ for loading onto the ship. In the meantime and
because of congestion in the port, the expected date of departure had
been altered to 10 December 2001. Loading eventually commenced
on 11
December and was completed on 13 December at 7.30 am. The ship left
port on 13 December at 10.15 am.
[9] From the time the litchis were moved to the container terminal
Jangda was in constant communication with Premchund to ascertain
the
state of progress and when the ship would sail. By 10 December 2001
he became concerned that by the time the ship arrived in
Dubai the
celebration period would be over, and that the market would not be
able to accommodate the entire consignment of litchis.
He accordingly
decided to split the risk by arranging for one of the containers to
be carried on to Damman in Saudi Arabia.
[10] In the meantime, another of MSC Genevaâs ships, the
MSC
Camille
, while heading for Dubai on the usual route, experienced
a fire in her engine room and had to be towed to Maputo, Mozambique,
by
a sister ship, the â
MSC Daniela
â. Back in Durban, the
appellant received an urgent instruction from MSC Geneva to direct
the master of the
MSC Spain
not to proceed further but to wait
in the outer anchorage. This was followed by a further instruction,
received at 2.43 pm on 13
December, to arrange a berth for the
MSC
Spain
as she was returning to port, which she did at 8.35 am on
14 December. On the instructions of MSC Geneva the containers
destined
for Reunion were off-loaded and the vessel was directed to
proceed to Maputo to pick up cargo from the stricken
MSC Camille
.
In all, 171 containers were off-loaded out of a total of
approximately 800. The
MSC Spain
left Durban for Maputo at
4.57 am on 15 December.
[11] It was clear that the
MSC Spain
would be unable to
accommodate the entire cargo aboard the
MSC Camille
. The
MSC
Daniela
was also available to provide some assistance. As at 14
December when the
MSC Spain
was back in port the appellantâs
employees were therefore aware that she was no longer going to
Reunion, that she was calling at
Maputo to pick up cargo and would be
discharging that cargo in due course. What they did not know at that
stage was which and how
many of the ports of discharge on the normal
route the
MSC Spain
would by-pass en route to Dubai. That they
only discovered on 20 December 2001 when they received an email from
MSC Geneva setting
out the planned rotation. It then appeared that
the only port on the normal route at which the
MSC Spain
would
not call was Mumbai. In the event, the vessel ultimately arrived at
the port of Jebel Ali in Dubai on 10 January 2002. One
of the two
containers was then transshipped to another vessel which arrived at
Damman on 14 January 2002.
[12] Before considering the claim in delict, it is necessary to refer
briefly to the question of Tebeâs
locus standi.
The only
representative of Tebe to testify was Jangda. He stated on a number
of occasions in evidence that Tebe had purchased the
litchis from
Laughing Waters, but he also described Tebe as the formerâs
marketing agents for the Middle East. Although in the
present case
Tebe had actually paid Laughing Waters R35 per carton for the
litchis, he described the payment as being in pursuance
of a
commercial arrangement rather than a legal obligation. It appears
that the arrangement between the parties involved was an extremely
loose one and that the price paid to Laughing Waters was finally
determined only once the litchis had been sold on the Middle East
market by the consignees. Counsel for the appellant defended the
finding of Combrinck J that a sale to Tebe had not been proved and
contended that the evidence supported the inference of a typical sale
on consignment. Counsel for Tebe, on the other hand, submitted
that
the court
a quo
had correctly found that a valid sale had been
concluded between Laughing Waters and Tebe and that ownership had
passed to the latter.
It was contended further that in any event,
even in the absence of a sale to Tebe, the evidence gave rise to an
inference of an intention
on the part of Laughing Waters to transfer
ownership and on the part of Tebe to acquire it. (Tebe did not
deliver the bills of lading
to the consignees.) In view, however, of
the conclusion to which I have come regarding Tebeâs claim in
delict it is unnecessary
to decide the issue of
locus standi
and I shall assume, without deciding, that Tebe did indeed have the
necessary
locus standi
to pursue its claim.
[13] I turn then to the claim in delict. What is immediately apparent
is that Jangda was fully aware of the initial delay and that
the
MSC
Spain
did not sail on the estimated date of departure. What he
did not know was that in the afternoon of Thursday, 13 December 2001,
and
after the vessel had sailed, the master was instructed to return
to port, that the vessel did return on the morning of 14 December
and
left again in the early hours of the morning of 15 December en route
to Maputo. He testified that had he known that the vessel
was coming
back to port and was thereafter to follow a less direct route to
Dubai he would either have had the containers of litchis
transshipped
to another vessel taking a more direct route or he would have had the
containers removed and sold the litchis on the
local market. It was
the omission on the part of the appellant to inform him of the
vesselâs return to port on 14 December and
subsequent deviation
that formed the basis of the claim in delict.
[14] Wrongfulness and fault are both requirements for liability under
the modern Aquilian action. Negligent conduct which is not
also
wrongful is therefore not actionable. The inquiry into the existence
of the one, save in the case of
dolus
,
2
is discrete from the inquiry into the existence of the other.
However, the issue of wrongfulness will more often than not be
uncontentious.
This is because the culpable conduct complained of
will be
prima facie
wrongful. Typically, this is the case
where the negligent conduct takes the form of a positive act which
causes physical harm. But
conduct which takes the form of an omission
or which results in pure economic loss is not
prima facie
wrongful.
3
In such cases it becomes necessary to determine whether there is a
legal duty owed by the defendant to the plaintiff to act without
negligence
4
or, as the inquiry has more recently been formulated, whether, if the
defendant was negligent, it would be reasonable to impose liability
on him for such negligence.
5
This, in turn, is a matter for judicial judgment involving criteria
of reasonableness, the legal convictions of the community, policy
and
where appropriate, constitutional norms.
6
Precedent may also play a role.
7
Where, as in the present case, it is contended that there existed a
delictual legal duty in what was essentially a contractual setting,
relevant circumstances will include such factors as the extent to
which the plaintiff was or could have been protected against the
risk
of harm by contractual provisions, whether the duty alleged could
have arisen in the absence of a contract and generally, depending
on
the circumstances, the mere existence of the contract. In
Trustees,
Two Oceans Aquarium Trust v Kantey and Templer (Pty) Ltd,
8
for example, the court was not prepared to recognise the existence of
a legal duty in circumstances where the plaintiffs could have
protected themselves against pure economic loss by contractual means.
Similarly, in
Lillicrap, Wassenaar and Partners v Pilkington
Brothers (SA) (Pty) Ltd
9
the court, while recognising the possibility of a
concursus
actionum
, declined to accept the existence of a delictual legal
duty in circumstances where the plaintiff would previously have had a
claim
in contract but had subsequently assigned its rights and
obligations under the contract to a third party.
[15] To return to the present case, the court
a quo
found that
the appellant owed âa duty of careâ to Tebe and that its failure
âto actâ was therefore wrongful. In coming to
this conclusion
Levinsohn J, who delivered the judgment of the court, noted that the
appellant had procured Tebeâs business on
the understanding that
the voyage would be of short duration, that the appellant was aware
of the limited shelf life of the consignment,
that the appellant had
been found to have been privy on 14 December 2001 to information that
was of vital importance to Tebe and
that there existed a relationship
of âagent and customerâ between the appellant and Tebe. In these
circumstances, the learned
judge observed that it would have taken
only one telephone call to inform Tebe of the situation and expressed
the view that had this
been done â[Tebe] in all probability would
have elected to take the containers off the vessel and sell the fruit
on the local marketâ.
10
However, no regard appears to have been had to the terms of the
contract of carriage to which Tebe was a party, nor to the
relationship
between the appellant and its principals.
[16] As previously mentioned, Tebeâs forwarding agents, WSS Africa,
made the necessary booking with the appellant. It is common
cause
that the bills of lading were on the appellantâs standard form. Mr
Christopher Pienaar, an employee of WSS Africa, testified
that he
inserted the necessary particulars and then submitted the bills to
the appellant for the latter to issue. He said that before
doing so
he sent them to Jangda to check. Jangda was presumably familiar with
the appellantâs standard bills of lading as he had
previously
shipped goods with the same shipping line. The terms and conditions
governing Tebeâs contracts with the carrier were
set forth on the
reverse side of the bills. Clauses 4 and 7 are of particular
relevance. In terms of clause 4 the carrier is afforded
the right to
deviate from the advertised or ordinary route. More particularly, the
clause provides that the vessel may call at ports
other than those
âin or out of the advertised geographical, usual or ordinary routeâ
and âomit calling at any port or ports
whether scheduled or notâ.
11
In terms of clause 7, the carrier is afforded the right to change
sailing and arrival dates without notice.
12
Also of relevance is the introductory clause on the reverse side of
the bills of lading. The penultimate sentence of that clause
reads
âMSC [Geneva] shall act as agent of the owner or demise charterer
in arranging the transport covered by this Bill of Ladingâ.
This
provision was presumably inserted so as to enable MSC Geneva to
obtain the benefit of the Himalaya clause. But whatever the
reason,
the effect was that for the purpose of the contract of carriage MSC
Geneva acted as the agent of the owner in âarranging
the
transportâ. That would include determining the route to be followed
and the ports of call.
[17] Tebeâs claim is for the loss it suffered as a result of the
delay brought about by the deviation from the initially proposed
route. The appellant was not in any way responsible for that
deviation. It was furthermore at all times merely acting as agent,
either
for the carrier or MSC Geneva. By reason of the clauses in the
bills of lading previously mentioned, Tebe would have had no claim
in
contract or delict against the party responsible for the deviation,
whether that party was the carrier or MSC Geneva. Unable to
recover
from the principal, Tebe seeks in effect to circumvent the
consequences of the contract by holding the principalâs agent
personally liable in delict for failing to afford Tebe the
opportunity of removing its containers from the vessel on a ground
not
amounting to a breach of contract on the part of the principal.
But agents are contractually bound to protect the interests of their
principals. The legal duty that Tebe contends was owed to it by the
appellant would therefore be in conflict with the contractual
obligation which the latter had to its principal. Even if it were to
be accepted that the appellant was negligent, there can be no
good
reason in my view, given the contractual setting, for the existence
of a legal duty on the appellant to take such steps as may
have been
reasonable to prevent the harm. It follows that in my judgment the
failure on the part of the appellant to advise Tebe
of the deviation
so as to afford it the opportunity of removing its containers from
the vessel was not wrongful and the claim in
delict must fail.
[18] For the sake of completeness I propose to deal briefly with the
issue of negligence. The finding of the court
a quo
that the
appellant had been negligent was founded on what the court held to be
an overwhelming probability that the appellant knew
on 14 December
when the
MSC Spain
returned to port that the vessel would be
re-routed to the various ports at which the
MSC Camille
had
been scheduled to call. Accordingly, so the court held, it was
overwhelmingly probable that the appellantâs employees knew
that
the
MSC Spain
âs transit time was going to be significantly
longer than originally contemplated.
13
In my view, the evidence does not support this finding. On 14
December the appellantâs employees knew that the
MSC Spain
was to discharge the 171 containers (out of a total of some 800)
destined for Reunion and that the vessel was to pick up cargo at
Maputo. But they did not know at which ports that cargo was to be
discharged, in other words, at which of the ports on the normal
route
the vessel would call. As I have previously said, they only learned
this on 20 December 2001 when they received an email from
MSC Geneva
setting out the planned rotation. Mr Neville Naidoo, the trade
manager of the appellant at the time and who testified
on behalf of
Tebe, conceded in evidence that if the
MSC Spain
was to
replace the
MSC Camille
(and call at all the ports of
discharge) the transit time would be the normal 25 days.
14
But he emphasized that the
MSC Spain
already had cargo on
board and would not have been able to accommodate all the cargo taken
off the
MSC Camille
. When asked in cross-examination why he
did not inform Jangda (who, and whose business, was known to him) of
the change in the route
he explained that based on the information
then available he did not anticipate a delay of any significance.
There was nothing to
suggest that this belief was unreasonable or
that any other employee of the appellant was better informed than he
on 14 December
2001. In my view, therefore, Tebe failed to establish
negligence on the part of the appellant.
[19] It follows that the appeal must succeed. In the circumstances it
is unnecessary to consider the question relating to the Himalaya
clause. The failure to do so must not, however, be construed as an
endorsement of the views expressed by the court
a quo
.
[20] In view of this courtâs finding on the issue of delictual
liability the appellant is entitled to an order dismissing the claim
with costs, as opposed to the order of absolution from the instance
granted by the trial court.
[21] The following order is made:
1. The appeal is upheld with costs, such costs to include the costs
of two counsel.
2. The order of the court
a quo
is set aside and the following
is substituted in its place:
â
(a) The appeal is dismissed with costs;
The order of the trial court is altered to read:
â
The action is dismissed with costsâ.â
__________
D G SCOTT
JUDGE OF APPEAL
CONCUR:
FARLAM JA
CLOETE JA
LEWIS JA
CACHALIA JA
1
The
clause, which derives its name from the ship in
Adler
v Dickson
[1955] 1 QB 158
(CA),
provides that âno servant or agent of the carrier, including any
independent sub-contractor employed by the carrier in
any
circumstances whatsoever [shall] be under any liability whatsoever
to the merchant [which by definition includes the shipper,
the
consignee and the holder of the bill of lading] for any loss or
damage or delay of whatsoever kind arising or resulting directly
or
indirectly from any act, neglect or default on his part while acting
in the course and scope of or in connection with his employment
. .
. â.
2
Minister
of Finance and others v Gore NO
2007(1)
SA 111(SCA) para 86.
3
Sea
Harvest Corporation (Pty) Ltd v Duncan Dock Cold Storage (Pty) Ltd
2000 (1) SA 827
(SCA) para 19;
Telematrix
(Pty) Ltd t/a Matrix Vehicle Tracking v Advertising Standards
Authority
SA
2006 (1) SA 461
(SCA)
para 13.
4
Indac
Electronics (Pty) Ltd v Volkskas Bank Ltd
[1991] ZASCA 190
;
1992
(1) SA 783
(A) at 797F;
Minister of
Safety and Security v Van Duivenboden
2002
(6) SA 431
(SCA) para 12;
Local
Transitional Council of Delmas v Boshoff
2005
(5) SA 514
(SCA) para 14.
5
See
Trustees, Two Oceans Aquarium Trust v
Kantey and Templer (Pty) Ltd
2006 (3)
SA 138
(SCA) para 11 where the formulation of Anton Fagan
âRethinking wrongfulness in the law of delictâ (2005) 122
SALJ
90 at 109 is cited with approval. See
also
Hirschowitz Flionis v Bartlett
[2006] ZASCA 23
;
2006 (3) SA 575
(SCA) para 27.
6
See
eg
Minister van Polisie v Ewels
1975 (3) SA 590
(A) at 597A-B;
Minister
of Law and Order v Kadir
[1994] ZASCA 138
;
1995 (1) SA
303
(A) at 318E-G;
Minister of Safety
and Security v Van Duivenboden
(n4)
para 22.
7
Telematrix
(Pty) Ltd t/a Matrix Vehicle Tracking v Advertising Standards
Authority SA
(n3) para 15.
8
Note
5.
9
1985
(1) SA 475
(A).
10
2006
(4) SA 495
(N) at 509D-H.
11
Clause
4 of the bills of lading reads as follows: âTHE SCOPE OF VOYAGE.
The voyage herein
undertaken shall include usual or customary or advertised ports of
call whether named in this contract or not, also ports in or
out of
the advertised geographical, usual or ordinary route or order, even
though in proceeding thereto the vessels may sail beyond
the port of
discharge or in a direction contrary thereto, or depart from the
direct or customary route or in a direction contrary
thereto. The
vessel may call at any port for the purpose of the current voyage or
of a subsequent voyage. The vessel may omit calling
at any port or
ports whether scheduled or not, and may call at the same port more
than once, either with or without the goods on
board, and before and
after proceeding towards the port of discharge, adjust compasses,
dry-dock, go on ways or to repair yards,
shift berths; undergo
degassing, wiping or similar measures, take fuel or stores, land
stowaways, remain in port, sail without
pilots, tow and be towed,
and save or attempt to save life or property, and all of the
foregoing are included in the contract voyage.
The vessel shall
never be called upon to proceed to a place where she cannot safely
get and be always afloat.â
12
Clause
7 reads: âDEPARTURE AND ARRIVAL DATES in the Carrierâs liner
position lists, sailing lists and other advertisements are
given
without any warranty, and no claims shall be acceptable for any
change in the dates nor even in the case of the vesselâs
non-departure for whatever cause. Carrier shall have the right to
change sailing and arrival dates without notice.â
13
2006
(4) SA 495
at 508B-C.
14
See
the passage in Naidooâs evidence quoted at 507G.