A limitation on limitation? The Julian [Discussion of MS “Bonanza” Schiffahrtgesellschaft Mbh & Co, KG v Durban Coal Terminal Company (Pty) Ltd t.a Bulk Connexions (A50/2017) 2018 ZAKZDHC 6 (29 March 2018)]

• Citation: (2022) 33 Stell LR 671
• DOI: https://doi.org/10.47348/SLR/2022/i4a7
• Published date: 28 March 2023
• Pages: 671-689
• Author: Wallis, M.
• Date: 28 March 2023

671

https://doi.org /10.47348/ SLR/2 022/i4 a6

A LIMITATION ON LIMITATION? THE

JULIAN [DISCUSSION OF MS “BONANZA”

SCHIFFAHRTGESELLSCHAFT MBH & CO, KG

v DURBAN COAL TERMINAL COMPANY (PTY)

LTD T.A BULK CONNEXIONS (A50/2017) 2018

ZAKZDHC 6 (29 MARCH 2018)]

Malcolm Wallis

Retired Judge of the Supreme Court of Appeal

Honorary Professor of Law

School of Law, University of KwaZulu-Natal*

Abstract

The article explores the topic of limitation of liability for maritime claims

in terms of section 261 of the Merchant Shipping Act 57 of 1951 in the light

of the decision in The Julian (MS “Bonanza” Schiffahrtgesellschaft mbH &

Co, KG v Durban Coal Terminal Company (Pty) Ltd t.a Bulk Connexions

(A50/2017) 2018 ZAKZDHC 6 (29 March 2018)) and the subsequent decision

of the Supreme Court of Appeal in The MSC Susanna (MV “MSC Susanna”:

The Owners and Underwriters of the MV MSC Susanna v Transnet SOC Ltd

2022 2 SA 85 (SCA)). In particular, it addresses the conclusion in The Julian

that the entitlement of a shipowner to limit its liability under section 261 is

restricted to claims that have been instituted in South Africa and submits that

this is incorrect and inconsistent with the decision in The MSC Susanna.

Keyword s: Limitation of liability for maritime claims; section 261(1) of the

Merchant Shipping Act 57 of 1951; entitlement to limit applies to all claims

wherever pursued

1 Introduction

Three cases in a century on the limitation of liability for maritime claims is

not a ood of litigation.1 But in 2017 two major incidents occurred in Durban

* Since the prep aration of this art icle, I have received helpful com ments from Steve Mulli ns SC and Paul

Wallis SC I must als o express my grat itude to Tony Norton f rom ENS who made all t he papers in the ca se

involving the Julian avail able to me Any faults in t he article are my res ponsibility

1 South Afric an Railways & Harbo urs v Smith’s Coasters (Pty) Ltd 1931 AD 113; Atlantic Harvesters of

Namibia (Pty) Lt d v Unterweser Re ederei GmbH of Bre men 1986 4 SA 865 (C); Nagos Shipping Ltd

v Owners, Car go lately laden on board the MV Nag os 1996 2 SA 261 (D) (“The Nago s”) Much of the

procedura l manoeuvr ing in relation to t he Tigr was concer ned with whet her South Afr ican or United

Kingdom (“UK ”) law relating to lim itation would apply to the cl aim See Bouygue s Offshore SA v Owner s

of the MT Tigr 1998 4 SA 740 (C) 734I-744F and Bouyg ues Offshore SA v C aspian Shipping C o (Nos 1, 3, 4

and 5) [1998] 2 Ll oyds Rep 461 (CA) para 14 No twit hsta nding that th is mean t that th e limit atio n fund wo uld

be signific antly larger, the owner of the t ug sought limitation i n the UK on the basis that li mitation was

virtu ally unbreak able in that juri sdiction, while t he claimant want ed to proceed in So uth Africa on t he basis

that it believed t hat it had reasonable p rospects of break ing limitat ion under the South Af rican legislat ion

(2022) 33 Stell LR 671

© Juta and Company (Pty) Ltd

https://doi.org /10.47348/ SLR/2 022/i4 a6

harbour within six months of one another, each giving rise to a claim by

shipowners and charterers to limit their liability in terms of section 261 of

the Merchant Shipping Act 57 of 1951 (“MSA”). The rst was in April 2017,

when the Julian was berthing at the Durban Coal Terminal, overshot its berth

and allided2 with shore facilities. The second, in October 2017, took place

during a substantial storm in Durban harbour, when the MSC Susanna broke

her moorings and collided with a French naval vessel, the Floreal.

In subsequent litigation3 the respective owners and charterers of both the

Julian and the MSC Susanna invoked limitation.4 At rst instance, both matters

came before the same judge and both were unsuccessful. In The Julian5 leave

to appeal was refused by the rst instance judge, but granted by the Supreme

Court of Appeal. The judge granted leave to appeal in The MSC Susanna6

and it has already voyaged to the Supreme Court of Appeal.7 The issue in

that case was whether the shipowner could invoke limitation in relation to

the French government’s claims for damages arising from the damage to the

Floreal. An afrmative answer meant that the appeal was upheld. In the matter

involving the Julian the appeal was withdrawn two months after leave was

granted, the parties having reached an overall settlement. That is unfortunate,

as it means that a judgment on an important point concerning the scope of

the right to invoke limitation has not had the benet of consideration by a

higher court and, as it stands, could be regarded as binding on a single judge

in another case, unless held to be clearly wrong. Given its central holding and

its apparent inconsistency with the Supreme Court of Appeal decision in The

MSC Susanna, it is appropriate to consider whether it was correctly decided.

2 The facts

The incident giving rise to the claims against the owner of the Julian

occurred near the entrance to Durban harbour, while the vessel was proceeding

to its berth. It was at the time under compulsory pilotage by a pilot employed

by the National Ports Authority (“NPA”) and under tow by two tugs owned

and operated by the NPA. According to reports, it overshot its intended berth

because it was travelling at too high a speed and allided with the quayside

and a bulk loading appliance operated by the rst respondent, Durban Coal

2 When a vessel come s into contact wit h another vessel or f loating instal lation that is a collis ion Where it

comes into cont act with a land-ba sed installat ion that is an allision

3 Paul Wallis SC, my son, wa s junior counsel in b oth cases for the par ty seeking lim itation, but we had no

discussions c oncerning them be cause of the possibilit y that they might come before m e in the Supreme

Court of Appe al, as occurre d with the consent of al l parties in the ca se involving the MSC S usanna

4 To avoid repetition from h ere on I will refer only to ow ners, but what is said a pplies equally to ch arterers

by virtue of t he extended def inition of an own er in s 263 of the Mercha nt Shipping Act 57 of 1951

(“MSA”)

5 MS “Bonanza” Schiffa hrtgesellschaft mbH & Co, KG v Durb an Coal Terminal Company (Pt y) Ltd t.a

Bulk Connexions (A50/2017) 2018 ZAKZDHC 6 (29 March 2018) SAFLII <http://www saflii org/za/

cases/ZA KZDHC/2018/6 html> (accessed 2 5-10-2022) (“The Julian”)

6 MV “MSC Susann a” v National Ports Author ity of South Af rica, a division o f Transnet (SOC) Ltd (A4/ 19)

2020 ZAKZ PHC 51 (10 September 2020) SAFLII <ht tp://www safl ii org/cg i-bin/dis ppl? file =za/ca ses/

ZAKZPHC/2020/51 html&query=MSC%20Susan na> (accessed 25-10-2022)

7 MV MSC Susan na: The Owners a nd Underwr iters of the MV MSC S usanna v Transnet S OC Ltd (The MSC

Susanna) 2022 2 SA 85 (SCA) (“The MSC Susan na”)

672 STEL L LR 2022 4

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