LONG FORD GARMENT LTD v. JAS FORWARDING (HONG KONG) LTD

cacv 324/2004

in the high court of the

hong kong special administrative region

court of appeal

civil appeal no. 324 of 2004

(on appeal from DCCJ NO. 4503 of 2002)

(Action transferred from HCA NO. 1184 OF 1997)

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J U D G M E N T

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Hon Rogers VP:

1.  This is an appeal from a judgment of HH Judge Chan given on 11 June 2004.  The matter before the judge was a claim in respect of loss of goods which had been sent to Venezuela.  The judge dismissed the plaintiff’s claim on the basis that the defendant was not the proper defendant in respect of the plaintiff’s contractual or tortious claims.  At the conclusion of the hearing of this appeal judgment was reserved which we now give. 

Background

2.  The plaintiff is a garment manufacturer and had a quantity of 210 cartons of children’s clothing to be shipped to a buyer in Venezuela.  The plaintiff had been approached by Silvereed International Ltd (“Silvereed”) on behalf of the buyer.  The plaintiff had not previously dealt with buyers in Venezuela and Mr George Bohbot of Silvereed gave Mr Foo, the director of the plaintiff, the business card of one Dr Pierre-Etienne Delalonde and asked the plaintiff to contact him to arrange the shipment.  Mr Delalonde’s card, which has been exhibited in this case, shows that he was the “France Route Manager” of the defendant.  The card bears the logo “jas” and describes the defendant as having a worldwide network with a number of countries being listed. 

3.  The bill of lading, No. 015044180, issued in respect of the shipment of the goods, bears the “jas” logo with the word “ocean” against it.  It named the plaintiff as the shipper and jas (caracas), venezuela as the consignee with the notifying party being the ultimate purchaser, namely koshito.  The port of lading is given as Hong Kong and the port of discharge as La Guaira and the place of delivery by the on-carrier as Porlamar.  Underneath the words “freight collect” in the body of the bill of lading is the statement “route: fm hkg to porlamar with transhipment in la guaira”.  The face of the bill of lading contains the chop with the authorised signature of JAS Ocean (H.K.) Limited in two places.  The first is the receipt clause, which commences “received and accepted by the Carrier, in apparent good order and conditions…”.  The other chop is by the words “place and date of issue” and under the words “for and on behalf of the carrier”.

4.  The reverse of the bill of lading is headed “condition” and in the usual way contains the conditions which are apparently applicable to the contract of carriage.  The first point which should be noted is that clause 1 defines the Company as meaning the defendant.  The remainder of the conditions are in what would appear to be standard form and deal with the liability or disclaimer of liability of the Company.  Each one of the 21 conditions contains at least one, and in most cases more than the single, reference to the Company.  Reference at this stage may be made to clause 11 which reads as follows:

“(11)    Charges, Freight and Premiums

(a)      The Company’s charges will be calculated in accordance with its tariff rate in effect at the time of the receipt of the goods by the Company.  Such charges shall be in addition to the freight and other charges payable to the Carriers and to any sums payable to any insurers all of which shall be payable by the Customer and shall be based on the actual charges of such Carriers or insurers, save that the Company may retain all brokerages, commissions, discounts profits and other sums received by the Company from the Carriers, insurers and others in connection with the goods.  The Company is authorised to incur personal liability to all such carriers and insurers and to be paid any freight charges, damages or other sums of whatsoever nature due to such Carriers or insurers and, if the Company shall incur any such liability or shall make any such payment, the customer shall indemnify the Company in respect thereof.”

5.  It should be noted that the plaintiff’s chop and authorised signature appears on the reverse of the bill of lading, that is on top of some of the conditions.

6.  There is no dispute that JAS Ocean (H.K.) Limited issued an invoice dated 4 September 1995 in respect of certain incidental costs connected with the loading of the goods onto the ship.  They also issued a receipt on 20 September 1995 for the invoiced amount namely $3,652.  From this it may be deduced that the plaintiff paid the amount claimed to JAS Ocean (H.K.) Ltd.

7.  On 11 October 1995 Silvereed sent the defendant, attention Pierre, (presumably Mr Delalonde) a fax saying that the terms of the shipment should be “Freight to be prepaid” instead of “collect”.

8.  Matters, apparently, did not go well.  There was, it would seem, difficulty in Silvereed obtaining payment from Koshito.  There is a fax dated 5 December 1995 from the defendant (not from JAS Ocean (H.K.) Limited) addressed to the corresponding office in Caracas instructing that office to send the goods back to Hong Kong.  That fax was apparently sent by Mr Delalonde as it names the sender as “Pierre”.  A similar fax from the defendant, this time dated 15 December 1995, and again apparently drafted by Mr Delalonde was sent to Mr Bohbot at Silvereed which informed him that the goods had been released by “Jas Caracas” because of the presence of lawyers on behalf of Koshito.

The judgment below

9.  When considering the bill of lading, the judge stated that the naming of the defendant as the Company in the conditions was a mistake.  By that she meant that it was a secretarial mistake.  We have been shown the evidence as to that and it is scant.  When Mr Sung, the defendant’s director who gave evidence on its behalf, was first asked about the defendant being named as the Company he said:

Maybe JAS Ocean issued this bill of lading so JAS Ocean is a role of carrier and then maybe JAS Forwarding is the forwarder role.

(Tr. p. 65 R-S)

10.  It was only in cross-examination that he said:

Well, concerning the wordings on the bill of lading, the situation is that the JAS Forwarding (Hong Kong) Ltd was set up first and then it came into the existence of JAS Ocean and JAS Forwarding (China) Limited.  So I’m sure that the secretary of the company at that time did not act according to what was told to change the JAS Forwarding (Hong Kong) Limited into JAS Ocean (Hong Kong) Ltd when it was printed for the company of JAS Ocean.

(Tr. p. 73 I-K)

11.  When reminded of his previous answer that the defendant was the freight forwarder he said:

Well, for the definition or to define the meaning of “carrier” and “forwarder” I think it's not for me to define.  It is for the court to define.

(Tr. p. 73 O-P)

12.  Having held that JAS Ocean (H.K.) Limited was the carrier the judge went on to hold that the plaintiff had sued the wrong party.  No doubt the plaintiff considered that unfortunate because, apart from the time which had lapsed from the loss of the goods, JAS Ocean (H.K.) Limited was no longer in existence.

This appeal

13.  In my view, even on the basis that there was a secretarial mistake in naming the defendant as the Company in the bill of lading, that mistake can only have been a mistake within the defendant’s organisation and was clearly not known to the plaintiff.  On that basis it was a unilateral mistake, at best, even if one accepts the rather scanty evidence to that effect and discounts Mr Sung’s analysis in his evidence in chief that the defendant may have been a contracting party even if JAS Ocean (H.K.) Limited was the carrier.  Clearly given the evidence as to the introduction of the plaintiff to the defendant, contact would have been with Mr Delalonde and as his faxes and the faxes to him, albeit after the contract came into existence, show he was acting as an employee of the defendant.  Any unilateral mistake of the nature relevant in this case and unknown to the other party can have no effect on the other party.

14.  Mr Sung’s suggestion that the defendant was merely a forwarding agent cannot stand once it is held that it was the contracting party.  That can be the only conclusion on the wording of the conditions of the bill of lading.  Clause 11(a) and 11(b) which has not been quoted draw a clear distinction between the Company and the carrier.

15.  On the basis, therefore, that the contracting party was, indeed, the defendant because that was the party that was named as the Company, I do not see that the plaintiff should have been nonsuited.  It had a contractual document naming the defendant as its opposite contracting party.  It would appear that at least 2 carriers, namely Evergreen Marine Corporation and another unnamed carrier after discharge in La Guaira, were involved in the transportation, but the plaintiff’s contract was with the party named in the conditions in the bill of lading as the Company, namely the defendant.  Those conditions made clear that the rights and obligations under the contract lay with the defendant.  The analysis of this is that the bill of lading was evidence of a single contract for multimodal transport on a place to place basis.  In such a contract the defendant as a combined transport operator remains solely responsible to the plaintiff for the safety of the cargo: see e.g. Carriage of Goods by Sea by John F. Wilson, 4^th Edition, p. 241.  In my view, therefore, the plaintiff was entitled to succeed against the defendant. 

16.  There has been no respondent’s notice and no other arguments were raised on this appeal as to why of the defendant should be absolved from liability.  I would, therefore, allow this appeal and give judgment in favour of the plaintiff for the amount claimed plus interest.  I would make an order nisi as to costs in favour of the plaintiff.  There was an application to amend the notice of appeal.  That was dealt with de bene esse.  Since the amendment of the notice of appeal has not featured as one of the grounds upon which I would allow this appeal, the costs of the amendment would be to the defendant in the usual way.

Hon Le Pichon JA:

17.  I agree.

Hon Cheung JA:

18.  I agree.