HIGH COURT, ACCRA
DATE: 18 DECEMBER 1967
BEFORE: AMISSAH J.A.
CASES REFERRED TO
(1) C.I.L.E.V. v. Chiavelli [1967] GLR 652.
(2) Royal Exchange Assurance Corporation v. Sjoforsakrings Aktiebolaget Vega [1902] 2 K.B 384; 71 L.J.K.B. 739; 87 L.T 356; 18 T.L.R 714; 50 W.R 694; 7 Com. Cas. 205; 9 Asp. M.L.C 329, C.A.
(3) Vita Food Products, Inc. v. Unus Shipping Co. [1939] A.C. 277; [1939] 1 All E.R. 513; 108
L.J.P.C. 40; 160 L.T. 579; 55 T.L.R. 402; 83 S.J. 295; 44 Comm. Cas. 123, P.C.
(4) Fehmarn (Cargo Lately on Board) (Owners) v. Fehmarn (Owners); The Fehmarn [1958] 1 W.L.R. 159; sub nom. The Fehmarn [1958] 1 All E.R. 333; [1957] 2 Lloyd’s Rep. 551; 102 S.J. 123, C.A.
NATURE OF PROCEEDINGS
RULING on objection raised by the defendants as to the competency of the courts of Ghana to determine a dispute, the parties having expressly agreed that all disputes arising from a bill of lading should be adjudicated by the courts in England. The facts are sufficiently set out in the ruling of Amissah J.A sitting as an additional judge of the High Court.
COUNSEL
S. H. Annancy for the plaintiff.
Mensah for the defendants.
Lamptey (for Djabanor) for the co-defendants.
JUDGMENT OF AMISSAH J.A.
Counsel on behalf of the defendants has challenged the competence of this court to deal with this case. In sum his submission is that the action arises under or is connected with bills of lading in which the parties have expressly agreed that the contract shall be governed by English law and that all disputes shall be adjudicated upon by the court of England. As the parties have themselves chosen their own forum which is not in Ghana, a Ghanaian court has no jurisdiction to try the case.
In the case of C.I.L.E.V. v. Chiavelli [1967] GLR 652 (ruling delivered on 27 November 1967) where there was a similar agreement that disputes must be submitted to an Italian court, this court held that the parties must be kept to their original bargain to sue and be sued in Italy. The question is, why should not that result automatically follow in the present case? It will be remembered that there I stated that the courts in this country have jurisdiction to entertain actions relating to contracts, wherever made, in all cases where the parties are effectively before the court, as where personal
[p.746] of [1967] GLR 744
or substituted service of the writ has been effected on the defendants here, or leave has been given to serve the writ or notice of it out of the jurisdiction, or where the parties have voluntarily submitted to the jurisdiction. Nevertheless jurisdiction in that case was declined for one basic reason, namely, that in the circumstances of that particular case it did not seem to the court that justice would be done if the dispute were tried here. The agreement was made by Italians in Italy, the language used was Italian. Fresh and sometimes quite contradictory facts were being presented to the court from time to time as the preliminary proceedings progressed. Therefore, on the whole, the court thought it just that the dispute in question should be disposed of by the chosen forum in Italy.
Do the circumstances in this case justify the court in taking the same course? The defendants in this case are a Ghanaian company. In fact they are the national shipping line of Ghana. The dispute before the court arises out of an alleged improper detention of goods in Ghana by the defendants; goods which are said to be collecting vast rents for the Government of Ghana for every day that they continue to be detained. To ask the parties to seek their remedy now in England is in effect to tell the plaintiff to forgo his rights because by the time that action is disposed of, the rent due on the goods may be far in excess of their value. After several adjournments and the calling of some evidence, the defendants have remembered for the first time that by a provision in their own common form printed bill of lading, the jurisdiction of this court is ousted, the English courts being the sole authorities to sit on disputes connected with their bills. The circumstances seem to me to be quite different from the earlier case.Mr. Mensah for the defendants has urged upon me a passage from the judgment of Collins M.R. in Royal Exchange Assurance Corporation v. Sjoforsakrings Aktiebolaget Vega [1902] 2 K.B 384 at p. 394, C.A. as demonstrating that where the parties to a contract have elected that their disputes shall be submitted to a particular tribunal then no other tribunal has jurisdiction to adjudicate upon such a dispute. That passage is as follows:
“I think it is clear that in this case the parties did not intend to contract with reference to the Swedish law. They adopted a form of policy which is English, and it is expressly therein provided that, in case of any dispute under the policy, the Vega Company agree to be bound in all things by the jurisdiction and decision of the English Law Courts. I think, applying the
[p.747] of [1967] GLR 744
principle laid down in Hamlyn v. Talisker Distillery [1894] A.C 202), that having regard to the terms of the contract and the circumstances, the inference is clear that the parties intended that their rights under the contract should be governed by English law.”
The parties had provided that they would be bound by the jurisdiction and decision of the English courts, but nowhere in the judgments read in that appeal was it said that this meant that only an English court had jurisdiction to adjudicate upon matters arising out of the contract. What the court was interested in, in that case, and this is borne out by the concluding words of the passage quoted above, was to find out what the proper law of the contract was. What law governed the interpretation of the contract, not what forum the case has to be prosecuted in. And the form of words chosen by the parties, that they were bound by the jurisdiction and decision of the English courts was taken to mean no more than what Cozens-Hardy L.J. said at p. 396, “that the parties intended that their rights under the contract should be governed by English law as administered by an English Court.”
It seems to me that there was an element of confusion in learned counsel’s submission on this point. No doubt there is authority that where the parties themselves have selected the law which should govern their contract, effect should be given to this: see Vita Food Products, Inc. v. Unus Shipping Co. [1939] A.C 277, P.C. But that only means that the law of the particular country chosen should apply, whichever country the action is brought in. It certainly does not mean that the choice of the proper law of the contract determines the country in which an action may be brought. There is authority also that where the parties have contracted that disputes are to be referred to a foreign tribunal then prima facie the court in which an action is brought in breach of such agreement will stay the proceedings so brought. But such a provision does not oust the jurisdiction of our courts. Whether or not effect is given to the provision depends on the particular circumstances of each case. Thus in The Fehmarn [1958] 1 W.L.R. 159, C.A. the plaintiffs, an English company and the holders of a bill of lading which acknowledged the shipment at a Russian port, in apparent good order and condition, of a cargo of turpentine by a Russian organisation for carriage to London, began an action in England against the owners of the German vessel in which the turpentine was carried for damages arising out of a dispute under the bill of lading, it being alleged that, on delivery in London, the turpentine was discovered to be contaminated. It
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was a term in the bill of lading that “All claims and disputes arising under and in connection with this bill of lading shall be judged in the U.S.S.R.” In spite of this the English courts held that they had jurisdiction to determine the dispute. Lord Denning in the English Court of Appeal said this of the provision at pp. 161-162: “Then the next question is whether the action ought to be stayed because of the provision in the bill of lading that all disputes are to be judged by the Russian courts. I do not regard this provision as equal to anarbitration clause, but I do say that the English courts are in charge of their own proceedings: and one of the rules they apply is that a stipulation that all disputes should be judged by the tribunals of a particular country is not absolutely binding. It is a matter to which the courts of this country will pay much regard and to which they will normally give effect, but it is subject to the overriding principle that no one by his private stipulation can oust these courts of their jurisdiction in a matter that properly belongs to them.”
I think the principal enunciated is equally applicable to this country. I would therefore ask myself whether the dispute is one which should be dealt with here or should be left for the disposal of the English courts in accordance with the terms of the bill of lading. The circumstances, which I have already recounted, make it necessary that this court should not decline to entertain this action. There is no reason why this court cannot proceed with it and apply the English law the parties have agreed upon, which in this case cannot be very different from the law of Ghana on the point. I therefore overrule the objection.
DECISION
Objection overruled.
L. F. A.
