Butler v Banimar Shipping Co SA

• Jurisdiction: South Africa
• Judge: Howie AJ
• Judgment Date: 28 July 1978
• Citation: 1978 (4) SA 753 (SE)
• Court: South Eastern Cape Local Division

Howie AJ:

This is an application for confirmation of a provisional order of attachment ad fundandam jurisdictionem.

F On 18 November 1977 four bills of lading were issued and signed at Rotterdam in the Netherlands evidencing a contract of carriage by sea of 15 600 bags of milkpowder from Rotterdam to Luanda in Angola. The vessel employed was the Araxos, owned at all material times by the respondent. G In terms of clause 17 of the bills the contract was between the respondent and "the merchant". In clause I "the merchant" was defined as including, inter alia, both the consignee and the owner of the goods. The consignee was the Netherlands Embassy in Luanda, which endorsed the bills, and it appears prima facie from the papers, and is not in dispute for present purposes, that the owner of the goods was the Netherlands Government, In H the circumstances the contract was, practically speaking, between that Government and the respondent.

The Araxos did not proceed to Luanda as she was bound to do under the contract but, in alleged breach of the contract, deviated to Piraeus in Greece where the goods were off-loaded. In consequence, they were never delivered to Luanda.

In March 1978 the time-charterers of the vessel caused the goods to be placed under a "conservatory arrest".

In an attempt to obtain possession of the goods application was made

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to a Greek court at Piraeus by agents of the Netherlands Government for the lifting of such arrest. This step apparently failed because the agents concerned were not regarded in Greek law as having the legal capacity required to institute the application proceedings.

A To overcome this problem the Netherlands Government, on 30 March 1978, ceded its rights under the bills "especially the right to take delivery of the cargo" to a corporation registered in Greece, Miller Ltd EPE ("Miller"). Miller accepted this cession on 3 May 1978.

Pending Miller's application for the lifting of the arrest it was learnt B that the Araxos was in South African waters. Attorneys in the Netherlands acting for the underwriters of the cargo thereupon instructed John Edward Hare, a Cape Town attorney, to take legal proceedings for the attachment of the vessel so as to secure their client's claim for indemnification for the respondent's alleged breach of contract. Hare advised the Dutch C attorneys that such claim would have to be ceded to a South African resident before the desired attachment could take place. Consequently, the Dutch attorneys arranged that the Netherlands Government effected a second cession of its rights under the bills. This cession was effected to Centraal Missie Commissariaat ("CMC"), a Dutch corporation, on 12 May 1978 D and on the same day CMC ceded the rights transferred to it to Hare.

At some time prior to 13 May 1978 the Araxos entered Port Elizabeth harbour and has lain there ever since.

On the last-mentioned date Hare instituted attachment proceedings in the Cape Provincial Division on the strength of CMC's cession to him. Those E proceedings were subsequently withdrawn.

On 2 June Miller ceded the rights transferred to it by the Netherlands Government to Hare and on the same day Hare, armed with both CMC's and Miller's cessions, sought and obtained from the Cape Provincial Division a F provisional attachment order on the Araxos. That order was discharged on 16 June 1978.

On the latter date Hare made effective a written cession signed by him on 8 June 1978 wherein he transferred to the applicant the rights which he had acquired via CMC and Miller from the Netherlands Government. On the basis of Hare's cession the applicant, also on 16 June 1978 and G preparatory to his suing the respondent for damages for breach of its contract with the Netherlands Government, sought and obtained the following order in this Court made by SOLOMON AJ:

"1.

That a rule nisi do issue calling upon the respondent to show cause, if any, to this Court on I August 1978 at 10 am why an order should H not be granted authorising and directing the Deputy Sheriff of this Court to attach respondent's vessel Araxos at present berthed in Port Elizabeth harbour ad fundandum jurisdictionem in an action to be instituted by applicant against respondent.

2.

That this rule nisi operate as an interim order pending the return date.

3.

That leave be and is hereby granted to the applicant to sue the respondent by edictal citation for the relief set out in the notice of motion.

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4.

That service of process be effected on respondent at its registered address.

5.

That notice of intention to defend such action (if any) be filed by respondent within 21 days of service of the summons upon it.

6.

A That the costs of this application be costs in the cause.

7.

That, upon respondent furnishing security for applicant's claims set out in the notice of motion to the satisfaction of the Registrar of this Court, the aforesaid vessel be released from attachment.

8.

B That the originals of the documents comprising annexure 'C' be filed of record in this Court before noon on 20 June 1978."

Para 8 came to be inserted because much of the original documentation relied on by Hare is still filed of record in the Cape Provincial Division and the applicant was accordingly compelled to use photostatic copies of such documentation. This position still obtained when, on 11 July 1978, C the matter came before me and the respondent anticipated the return day of SOLOMON AJ's order and sought its discharge. However, it was accepted by Mr Hoberman, for the respondent, that all the documentation on record was in admissible form and production of the originals of any of the documents became unnecessary.

D After hearing argument I reserved judgment and on 18 July 1978 made the following order:

"1.

That the rule nisi contained in para 1 of the order of 16 June 1978 be and is hereby confirmed.

2.

That by reason of such confirmation paras 3, 4, 5, 6 and 7 of the said order remain of force.

3.

E That compliance with the terms of para 8 of the said order having been rendered unnecessary, that paragraph is set aside.

4.

That the costs occasioned by the respondent's opposition to confirmation of the rule be paid by the respondent.

5.

That the applicant's costs, on an unopposed basis, of the application F for confirmation of the rule be costs in the cause of the main action".

When the aforegoing order was made it was intimated that my reasons would be handed down later. Those reasons now follow.

That the applicant, an attorney practising in Port Elizabeth, is an incola G of this Court's area of jurisdiction is common cause. It was also accepted by counsel on both sides that the Netherlands Government's cession to Miller, although pre-dating its cession to CMC, merely transferred to Miller the right to take delivery of the goods and that, insofar as the Government had the right to sue the respondent for damages for breach of the contract of carriage, that right was transferred solely by the cession H to CMC. Accordingly no question arose as to the validity or invalidity of partial cessions either in our law or any other law.

On the strength of the cession from the Netherlands Government to CMC, the cession from CMC to Hare and the cession from Hare to the applicant, the latter maintains that he has acquired such right to sue for damages as the Netherlands Government had against the respondent arising out of the latter's failure to ship the goods to Luanda. Therefore, being an incola, the applicant contends that his acquired cause of action entitles him to attach the respondent's ship to found jurisdiction in the

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damages action which he proposes to institute against the respondent.

Mr Hoberman's first ground for opposing the confirmation of the rule...