PATRICIA STEWART v. NIPPON EXPRESS (HK) CO. LTD.

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REASONS FOR JUDGMENT

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Hon. Yang, C.J.:

1. These are our reasons for allowing the appeal of the defendant Nippon Express (HK) Co. Ltd. (hereafter referred to as "Nippon (HK)") and the intervening party Nippon Express France S.A. (hereafter referred to as "Nippon France") from an order made by Wong, J. dismissing the application of Nippon (HK) and Nippon France seeking the substitution/addition of Nippon France as a defendant.

2. The respondent (the plaintiff in the action) is an artist and the owner of six oil paintings. Her mother Mrs. Eva Stewart was her agent at all material times.

3. Nippon (HK) is a carrier operating in Hong Kong. Nippon France is a carrier operating in France.

4. By her Statement of Claim, dated 20th May 1991, the respondent pleads that in breach of an agreement made between herself and an art gallery, called the Axes Gallery in Paris, the latter without the prior notice and/or consent of herself or her agent unilaterally shipped the paintings from Paris to Hong Kong through Nippon (HK) who acted as a carrier of the paintings through its Paris office. It is further pleaded that her agent notified Nippon (HK) through its officer, a Mr. Eddie Yuen, on the 18th January 1991 that Axes Gallery was acting in breach of contract, and that she also informed Nippon (HK) that the consignee (i.e. the respondent) would not pay any freight charges. Pursuant to this information Nippon (HK) telexed its Paris office on the 25th January notifying them that the consignee would refuse to pay the freight charges. The next thing that occurred was that the paintings arrived in Hong Kong on the 27th January 1991 by air.

5. The paintings have been in the physical possession of Nippon (HK) ever since. The respondent claims that the paintings are wrongfully detained, and by reason of the matters pleaded, Nippon (HK) cannot exercise a right of lien over the paintings. The respondent further pleads that Nippon (HK) has committed an act of detinue.

6. By an affirmation dated the 16th September 1991 and exhibited in the court below, the General Manager of Nippon (HK) affirmed that his company acted as an agent for Nippon France in handling the discharge of the paintings carried by Nippon France from France to Hong Kong. It was therefore Nippon France which was the carrier and should be the defendant. He further affirmed that both companies would accept business of air carriage from any customer who approached them without reserving any general right to refuse to accept goods from customers.

7. In the court below counsel for Nippon (HK) argued that the crux of the whole question was whether a lien could be exercised. He urged that if Nippon France was not permitted to be joined, Nippon (HK) would be forced to take out separate proceedings of interpleader. For the plaintiff it was submitted that this was the simplest case of detinue as the Nippon (HK)'s possession of her paintings was not in dispute.

8. Having heard counsel, the learned judge held on 19th September 1991 that this is a simple case of detinue and the matters which Nippon (HK) and Nippon France sought to raise should be raised in the defence and be adjudicated at the trial. He also held that the paintings were in the possession of Nippon (HK) and the respondent was the prima facie owner. He accordingly refused the application to substitute Nippon France for Nippon (HK) as the defendant or to add the former's name to the proceedings.

9. On the 30th October 1991, the Statement of Claim was amended by deleting much of what appeared in the Statement of Claim of the 20th May 1991 (supra). The amended Statement of Claim confines itself to saying that the paintings were in the wrongful possession of Nippon (HK), who refused to return them despite repeated demands. It was a simple claim of detinue.

10. There are two general grounds of appeal. First, it is contended that the learned judge wrongly exercised his discretion under Ord. 15, r. 6(2) (b) of the Rules of the Supreme Court. Second, it is contended: (a) that Nippon France is in constructive possession of the paintings and Nippon (HK) is its agent, (b) that the issue of Nippon France's lien over the paintings is an issue to be determined in the action, (c) that Nippon (HK) has possession of the paintings as agent for Nippon France, and (d) Nippon France should be joined as a party so that all matters in dispute may be determined.

11. By this appeal, it is urged that an order be made to add or substitute Nippon France as a defendant to the action.

12. In our judgment, the central issue which calls for an answer is whether or not a lien was exercisable.

13. Ord. 15, r. 6(2) (b) (ii) is designed to govern precisely the kind of situation now under consideration. It provides that at any stage of the proceedings the court may make an order adding as a party "any person between whom and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which in the opinion of the Court it would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter".

14. Clearly the question of lien hinges on the resolution of the dispute as to which of the Nippon carrier companies was carrier of the paintings, and this should be determined in the one and same action.

15. We accordingly allowed the appeal by adding Nippon France as a defendant. Having heard counsel on the question of costs, we ordered that Nippon (HK) and Nippon France should have costs here and below. We also ordered that respective defences by Nippon (HK) and Nippon France be filed within 14 days from 27th November 1991.