Chong Sun Wood Products Pte Ltd v K & T Trading Ltd and Another

• Jurisdiction: South Africa
• Judge: Magid J
• Judgment Date: 12 October 2000
• Citation: 2001 (2) SA 651 (D)
• Docket Number: 7737/2000
• Hearing Date: 03 October 2000
• Counsel: C J Pammenter SC for the applicant. P J Olsen SC (with him I L Topping) for the first respondent. G Lopes for the second respondent.
• Court: Durban and Coast Local Division

Magid J:

On 19 September 2000 on the urgent ex parte application of the applicant I granted an order for the attachment ad confirmandam jurisdictionem of H certain logs formerly laden on board the MV Niki T. A rule nisi was issued returnable on 10 October 2000 calling upon the respondents to show cause, if any, to this Court why the attachment should not be confirmed. The applicant was given leave to sue the first respondent by edictal citation for, in the first instance, a declaratory order that it is the owner of the logs in I question and, in the alternative, an order calling upon the first respondent 'to do all things necessary to cause the said logs to be delivered to the applicant's agent at Durban' and, in the further alternative, an order that the first respondent pay damages in respect of its alleged breach of contract. Directions were also given as to the service of the order. J

Magid J

The applicant is a company with both its registered office and A principal place of business in Singapore and the first respondent is a company with its principal place of business in Mozambique. It is common cause, therefore, that both applicant and the first respondent are peregrini. The second respondent is a creditor of the first respondent, which arrested the logs in terms B of s 3(4) of the Admiralty Jurisdiction Regulation Act 105 of 1983 (the Admiralty Act) by order of this Court in the exercise of its admiralty jurisdiction. The applicant seeks no relief against the second respondent, which was cited merely because of its interest in the logs.

On 27 September 2000 the first respondent gave notice that C it intended to anticipate the return date of the rule nisi and to apply for the setting aside of the attachment. In support of that application the first respondent filed extensive affidavits, to which the applicant replied.

When the matter came before me on 29 September 2000 Mr Pammenter appeared for the applicant, Mr Olsen, with him Mr Topping, for the first respondent and Mr D Lopes for the second respondent. Mr Lopes informed me that he held in effect a watching brief for the second respondent which did not claim any costs against either of the other parties.

Mr Olsen submitted in limine that the applicant's launching papers did not disclose a cause of action and E the matter was accordingly initially argued on the basis of what was contained in those launching papers and without reference to the first respondent's opposing affidavits or to the applicant's replying affidavits. Subsequently I heard full argument on all the issues in the case. After hearing that argument I made the following order: F

'1.

That the rule nisi dated 19 September 2000 is discharged and the attachment order is accordingly uplifted.

2.

That the applicant is directed to pay the first respondent's costs, including the costs consequent upon the employment of two counsel.'

I indicated that my reasons would be filed later. These now follow. G

The point in limine

Mr Olsen's submission was in accordance with what was said by Miller J in Hart v Pinetown Drive-In Cinema (Pty) Ltd 1972 (1) SA 464 (D) at 469B - E, namely: H

'It has been said . . . that in the case of an objection in limine of the kind now under consideration, the enquiry is only whether a prima facie case has been made out in the petition. It must be borne in mind, however, that where proceedings are brought by way of application, the petition is not the equivalent of the declaration in proceedings by way of action. What might be I sufficient in a declaration to foil an exception, would not necessarily, in a petition, be sufficient to resist an objection that a case has not been adequately made out. The petition takes the place not only of the declaration but also of the essential evidence which would be led at a trial and if there are absent from the petition such facts as would be necessary for determination of the issue in the petitioner's favour, an objection that it does not support the relief claimed is sound.' J

Magid J

(See, too, Pearson v Magrep Investments (Pty) Ltd and Others 1975 (1) SA 186 (D).) A

In order to consider the validity of Mr Olsen's submission it is necessary to have regard to the allegations that were made in the founding affidavit of Kao Chiu Hsiung, a director of the applicant, which contained the evidence upon which the applicant's cause of action was based. The facts upon which the applicant relies are the following: B

'7.

During or about May 2000 the applicant and first respondent concluded an agreement for the purchase of certain consignments of various types and grades of logs. In concluding that agreement I represented the applicant and Ken Tsou represented the first respondent.

8.

In terms of that contract the first respondent was to C provide the applicant with various consignments of logs from Mozambique at quantities and rates which would be agreed. In order for the first respondent to source the logs required by the applicant and to pay for those logs the applicant advanced to the first respondent the sum of US $800 000 to procure logs on behalf of the applicant.

9.

That US $800 000 was in fact an advance payment towards the D purchase price of the logs.

. . .

13.

On or about 23 July 2000 and at Mozambique I (on behalf of the applicant) concluded a partly written and partly oral agreement with Mr Ken Tsou of the first respondent for a fourth shipment of logs. I annex hereto marked F a copy of the written portion of that agreement. E

14.

In terms of that agreement the applicant purchased an entire ship load of logs of the price and quality reflected in the written portion of the agreement annexed hereto marked F.

15.

The first respondent was to arrange for the shipment of those logs on board the Niki T to the applicant from Pemba port in Mozambique to the applicant in Durban. It was agreed that shipment would be in August 2000. F

16.

The applicant and first respondent agreed on a specific purchase price for each type and species of log and that price was a ''free on board'' price in US $.

17.

In other words, the first respondent was to deliver the logs on board the Niki T in Pemba for delivery to the applicant in Durban.

18.

The first respondent was to invoice the applicant for the G cost of the logs once the exact quantity had been quantified and, in the event that the purchase price exceeded the sum of US $124 377,68, the applicant was to make payment of the balance of that purchase price on loading.'

The amount of US $124 377,68 is the balance of the advance payment of US $800 000 which the applicant says remains in the hands of the first respondent. Paragraphs 10 - 12 of the affidavit which, H brevitatis causa, I have not quoted, refer to various annexures which are alleged to support the applicant's version of the nature and terms of the contract between the parties.

In para 23 of his affidavit the deponent submitted that the applicant 'is in fact the owner of the logs and has a claim for delivery of the I logs against payment of the balance of the purchase price to the first respondent'.

In para 24 the deponent makes the following alternative submission:

'Alternatively to the contents of para 23 hereof and if it should be held that ownership of the logs has not yet passed to the applicant, then in terms of its J

Magid J

agreement with the first respondent, the applicant A is clearly entitled to delivery of the logs against payment of the balance of the purchase price as aforesaid.'

In my view this alternative submission is not intended to be based upon the facts alleged by the deponent but rather makes allowance for the possibility that the terms of the contract relied upon by the deponent might be disputed by the first respondent. Mr B Pammenter sought to argue that the reference to a fob price was not intended to suggest that the contract was a fob contract and that the alternative submission contained in para 24 of the affidavit entitled the applicant to contend on the basis of the facts alleged that the contract was in fact a c & f contract. It is true that the freight in respect of the first consignment was paid by the first C respondent out of the applicant's...