HIGH COURT, ACCRA
DATE: 10 FEBRUARY 1971
HAYFRON-BENJAMIN J.
CASE REFERRED TO
Fehmarn (Cargo Lately on Board) (Owners) v. Fehmarn (Owners); The Fehmarn [1958] 1 W.L.R. 159 sub nom. The Fehmarn 102 S.J. 123; [1958] 1 All E.R. 333; [1957] 2 Lloyd’s Rep. 551, C.A.
NATURE OF PROCEEDINGS
PRELIMINARY OBJECTIONS by the defendants in an action for damages against them as a result of goods which they carried having been delivered in a damaged condition. The facts are sufficiently set out in the judgment of Hayfron-Benjamin J.
COUNSEL
R Korsah for the plaintiffs.
M.A . F. Ribeiro, State Attorney for the defendants.
JUDGMENT OF HAYFRON-BENJAMIN J
The plaintiffs by their endorsement on the writ of summons claim the sum of N¢4,081.70 being damages occasioned to the plaintiffs by reason of the negligence or breach of duty or both on the part of the defendants, their servants or agents. The statement of claim shows that by a contract contained in a bill of lading dated 28 October 1968, the defendants acknowledged the shipment on board their vessel the Otchi River in apparent good order and condition, of 400 cartons of butter oil for carriage to and delivery at Tema in the like good order and condition, for an agreed freight. The bill of lading was made subject to the Carriage of Goods by Sea Act, 1924 (14 & 15 Geo. 5, c. 22), and the rules scheduled
[p.240] of [1971] 1 GLR 238
thereto. The plaintiffs claim that in breach of their duty under the said bill of lading or as carriers for reward or both the defendants failed to deliver the said butter oil in the like good order and condition as when shipped but have delivered same in a damaged state. The defendants deny the breach of duty and contend that the plaintiff was guilty of negligence by failing to pack the said butter oil in a manner consistent with the carriage of butter oil from a cool to a hot climate. The defendants denied liability to pay damages by virtue of article 4, rule 2 (m) of the Schedule to the Bills of Lading Act, 1961 (Act 42). This article provides:
“2. Neither the carrier nor the ship shall be responsible for loss or damage arising or resulting from– .…
(m) Wastage in bulk or weight or any other loss or damage arising from inherent defect, quality or vice of the goods.”
No other section of the Act was pleaded by the defendants.
At the hearing of the case counsel for the defendants raised two preliminary objections to the hearing by this court of the suit. The first is that this action is statute-barred having regard to the provisions of article III, r. 6 of the Hague Rules as contained in the Carriage of Goods by Sea Act, 1924 (supra), or Act 42. This provides inter alia that, “In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.” In the Supreme [High] Court (Civil Procedure) Rules, 1954
(L.N. 140A), Order 19, r. 16 provides that:
“The defendant or plaintiff (as the case may be) must raise by his pleading all matters which show the action or counterclaim not to be maintainable, or that the transaction is either void or voidable in point of law, and all such grounds of defence or reply, as the case may be, as if not raised would be likely to take the opposite party by surprise, or would raise issues of fact not arising out of the preceding pleadings, as, for instance, fraud, Statute of Limitations, release, payment, performance, facts showing illegality either by statute or common law, or Statute of Frauds.”
The defendants, as I have already said, did not raise the point that the action is statute-barred in their pleadings. They however applied to amend their defence and plead it. I refused leave to amend. I did so because I was satisfied from the exhibits tendered before the court that there were negotiations between the parties, and that the defendants specifically agreed to extend the time within which the action could be brought. Of course, that by itself would not necessarily have prevented the defendants from relying on the statutory provisions. However, having agreed to an extension of time and having failed to plead the statute in their statement of defence, I did not think the ends of justice would be served by allowing the defendants to amend their pleadings and plead the statutory provisions after the close of pleadings and after the statement of defence had been taken out.
[p.241] of [1971] 1 GLR 238
The second objection was to jurisdiction. By the bill of lading the parties had chosen the English courts as the forum for the settlement of disputes arising thereunder. They had also chosen English law as the law applicable. The defendants’ objection is that this agreement must be respected, and that further proceedings in this court be stayed and the parties referred to the English courts. The plaintiffs are a company registered under the laws of Ghana and carrying on business in Ghana. The defendants are a statutory corporation established by and under the laws of Ghana, and wholly financed from public funds. The vessel carrying the goods, the Otchi River is a Ghanaian ship, registered in Ghana and flying the Ghanaian flag. The goods were to be delivered at the port of Tema, a Ghanaian port. The goods were for use in Ghana. Ghana law relating to the carriage of goods by sea is not materially different from the English law chosen by the parties. In these circumstances it would seem strange that a statutory corporation owned by the State, and represented by the Attorney-General’s representative should insist on this action being litigated in England, with its attendant expenditure of scarce foreign currency. Of course there may be good and substantial grounds for this submission but these were not made apparent to the court.
The principles on which the courts would stay proceedings where the parties have by their contract chosen a foreign forum for the agitation of their disputes were considered by the English Court of Appeal in the case of The Fehmarn [1958] 1 W.L.R. 159, C.A. In that case 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 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 was a term of the bill of lading that all claims and disputes arising thereunder “shall be judged in the U.S.S.R.” The defendants moved for an order that the writ of summons be set aside for want of jurisdiction, or alternatively that the action be stayed. It was held that the English courts had jurisdiction and that the action would not be stayed. Lord Denning said at pp. 161 and 162 that:
“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 an arbitration 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 belong to them . . . It has been said [by counsel for the shipowners] that this
[p.242] of [1971] 1 GLR 238
contract is governed by Russian law and should be judged by the Russian courts, who know that law. And . . . the dispute may involve evidence from witnesses in Russia about the condition of the goods on shipment . . . I do not regard the choice of law in the contract as decisive. I prefer to look to see with what country is the dispute most closely concerned. Here the Russian element in the dispute seem to me to be comparatively small.”
Reasonableness, therefore, is usually the criterion for deciding whether or not a jurisdiction clause ought to be honoured, and what is reasonable is a question of fact for the court. As I have said the parties are a Ghanaian company and a Ghanaian corporation, the goods were delivered in Ghana. Ghanaian law and English law on the matter do not differ in any material particular. I do not think this is a proper case to stay proceedings. I therefore overrule the preliminary objections and order the case to proceed to trial. Costs to the plaintiff in any event. Case fixed for hearing on 23 February 1971.
DECISION
Preliminary objections overruled.
Trial date set down.
T. G. K.
