CMA CGM S.A. v. INTEXPORT STAINLESS STEEL COMPANY LTD

HCAJ 37/2023

[2025] HKCFI 4470

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO. 37 OF 2023

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JUDGMENT

1.  This is the assessment of the Plaintiff’s damages arising out of an incident (“Incident”), interlocutory judgment having been entered against the Defendant herein.

2.  The Defendant was absent today. Notice of the appointment for assessment having been duly served on the Defendant, I proceeded with this hearing in the absence of the Defendant.

3.  The Plaintiff was the charterer of the vessel ”CMA CGM ALKAZAR (“Vessel”) and carrier under a contract of carriage (“Contract of Carriage”) as evidenced by a bill of lading under which a container (“Container”) containing the Defendant’s cargo comprising 3 cold rolled stainless steel coils (“Cargo”) was to be carried from Shantou, PRC China to Gebze, Turkey.  The Defendant was the owner and shipper of the Cargo under the Contract of Carriage.

4.  The Incident took place on 6 April 2023 when the Container was being loaded on board the Vessel at Malta Freeport Terminal and the Cargo inside the Container broke loose, damaged the Container, fell through a tear that the Cargo had made in the floor of the Container and fell on to the Vessel (and other containers loaded thereon) which suffered a full penetration of ballast tank top centre no.5 extending approximately 5 metres by 5 metres (or 25 square metres) with a total of 4 longitudinal beams supporting the top of the tanks having also buckled apart from a 16mm doubler extending over the same area.

5.  As the Vessel could not be repaired in Malta without undue delay (the earliest available repair slot being 5 May 2023), temporary repairs were carried out in Malta (with the entire cargo on board the Vessel having to be discharged ashore) before the Vessel could proceed to Piraeus, Greece for permanent repairs which completed on 22 April 2023.

6.  The Incident was well documented and evidenced by contemporaneous documents and reports adduced and relied on by the Plaintiff which has given full details of its damages in the Amended Statement of Damages filed herein comprising the following items:

(a)  Temporary repair at Malta at €35,275;

(b)  Additional costs incurred at Malta at €169,336.27;

(c)  Permanent repair costs at Piraeus at US$171,205.07;

(d)  Loss of use of the Vessel at US$563,585.78; and

(e)  Bunker consumption at US$120,436.

7.  Having carefully examined the relevant documents evidencing the repairs at Malta and Piraeus and the invoices issued in respect of such repairs, I am satisfied that it was a reasonable decision to arrange for permanent repairs to be conducted at Piraeus instead of Malta to avoid undue delay, for which purpose it was necessary to have temporary repairs conducted at Malta.  I am also satisfied that the 2 sets of repair costs were in fact incurred as claimed.  Absent anything casting doubt on the reasonableness of such repair costs, I allow the same in full.     

8.  As to the additional costs incurred at Malta, they are charges and expenses incidental to the temporary repairs at Malta and are particularized in paragraph 24 of the Amended Statement of Damages comprising no less than 24 items, including costs of surveyor attendance, berth and crane charges for discharging containers on board the Vessel and transhipment costs. 

9.  Such additional costs all are supported by documentary evidence save as to 3 items, namely, (i) Repair for TCLU3067747 at €763; (ii) Repairs CMAU3181463 (estimate) at €603; and (iii) Survey re cross stuff APZU3382703 & TCKU1012465 at €680.  Each of these items is referrable to a corresponding item of additional costs bearing the same reference number set out in paragraph 24 of the Amended Statement of Damages and such reference numbers were for identification of those containers damaged (along with the Vessel) by the Cargo during the Incident and which the Plaintiff was obliged to repair as well. 

10.  The only difficulty is with “Repairs CMAU3181463 (estimate) at €603”.  I understand from Mr. Toms, Solicitor Advocate for the Plaintiff that it is only an estimation because the Plaintiff is unable to produce documentary evidence pertaining specifically to the repair costs of this particular container which belonged to the Plaintiff (while the other damaged containers belonged to other shippers) and can only give an estimation. In the circumstances, Mr. Toms did not pursue the claim for this item. 

11.  Subject to the above, I am satisfied that the additional costs were incurred by the Plaintiff as charges and expenses incidental to the temporary repairs and therefore allow the same at €168,733.27 (€169,336.27 less €603), there being no evidence that the amounts were unreasonable.

12.  As regards the Plaintiff’s loss of use of the Vessel, it covers the period from 0620 hours on 6 April 2023 until completion of permanent repairs at 1600 hours on 22 April 2023, totalling 16.402778 days.  The Plaintiff’s loss is made up of (i) the charterhire payable under the Charter at US$35,500 per day (US$35,500 x 16.402778 = US$582,298.61) less 3.5% address commission (US$20,380.45); and (ii) the monthly lump sums payable under the Charter in respect of lashing material, CVR and fuel testing totalling US$3,050 (US$3,050 x 16.402778 = US$1,667.62).  The Plaintiff’s claim hereunder totalling US$563,585.78 (US$582,298.61 - US$35,500 + US$1,667.62) is well supported by documentary evidence.  I allow the same in full.

13.  As to the Plaintiff’s claim in respect of consumption of bunkers during the temporary repairs in Malta, the voyage to Piraeus and during the permanent repairs at Piraeus totalling US$120,436.00, the same is equally supported by documentary evidence including the Masters’ weekly bunker survey reports and invoices for bunker prices, namely:

VLSFO   113.100 tonnes @US$534/tonne = US$60,395.40

ULSFO   22.600 tonnes @US$631/tonne = US$14,260.60

LSMGO  60.00 tonnes @US$763/tonne   = US$45,780.00

14.  I allow the same in full.

Summary

15.  In summary, I allow the Plaintiff’s claims as follows:-

Item	Description	Amounts awarded
(1)	Temporary repairs	€35,275
(2)	Permanent repairs	US$171,205.07
(3)	Additional costs at Malta	€168,733.27
(4)	Loss of use of the Vessel	US$563,585.78
(5)	Bunker consumption	US$120,436
Total:		US$855,226.85 and €204,008.27

16.  Mr. Toms asked for interest on the same at commercial rate but eventually conceded that the actual dates of payment of the costs and expenses under items (1) to (3) are not shown among the documents adduced before me.  He would nonetheless ask for interest on items (4) and (5) to run at least from 22 April 2023 when the permanent repairs were completed. 

17.  I agree that the Plaintiff should be compensated by way of interest on the money loss in terms of the charterhire and lump sums payable under the Charter as aforesaid when the Vessel was rendered unavailable for its use during the repairs and in terms of the costs of the bunker consumed in the course of such repairs and that such interest should be calculated at commercial rate and at least run from 22 April 2023.  As to the damages under items (1) to (3), however, absent evidence at to the actual dates of payment, I can only allow interest at judgment rate to run from today until payment.

Conclusion

18.  The Plaintiffs are therefore entitled to damages in the respective sums of US$855,226.85 and€204,008.27 with interest on (i) US$684,021.78 (US$563,585.78 + US$120,436) at 1% above HSBC Best Lending Rate from 22 April 2023 until today and thereafter at judgment rate until payment; and (ii) US$171,205.07 and €204,008.27 respectively at judgment rate from today until payment. 

19.  Costs should follow the event.  The Defendant do pay the Plaintiff’s costs of assessment, including any costs reserved, to be taxed if not agreed.