MV MSC Susanna: - Owners and Underwriters, MV Msc Susanna and Another v Transnet SOC Ltd and Others

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Citation: 2022 (2) SA 85 (SCA)

MV MSC Susanna:
Owners and Underwriters, MV Msc Susanna and Another v Transnet SOC Ltd and Others
2022 (2) SA 85 (SCA)

2022 (2) SA p85

Citation	2022 (2) SA 85 (SCA)
Case No	1039/20; [2021] ZASCA 135
Court	Supreme Court of Appeal
Judge	Navsa JA, Wallis JA, Schippers JA, Mbatha JA and Gorven JA
Heard	September 1, 2021
Judgment	September 1, 2021
Counsel	SR Mullins SC (with PJ Wallis SC) for the appellants.; CJ Pammenter SC (with D Cooke) for the respondents.

Flynote : Sleutelwoorde

Shipping — General maritime law — Ship — Owner — Limitation of liability — Collision in local port between merchant ship and foreign warship — Application of tonnage limitation in s 261(1) of Merchant Shipping Act 57 of 1951 — Whether limitation may be invoked by owner of merchant ship against foreign defence ministry as owner of warship — Merchant Shipping Act 57 of 1951, s 3(6) and s 261(1)(b).

Headnote : Kopnota

It is an ancient principle of maritime law that shipowners have the right to limit their liability for damages arising from the operation of the ship to the value of the ship. In South Africa this limitation is embodied in ch V part 4 s 261(1)(b) of the Merchant Shipping Act 57 of 1951: 'Collisions, Accidents at Sea, and Limitation of Liability — (w)hen owner [of harm-causing vessel] not liable for whole damage'. The present case dealt with the interpretation of s 261(1)(b) in the light of s 3(6) of the Act, which states that the Act 'shall not apply to ships belonging to the defence forces of the Republic or of any other country'.

The facts were that, during a severe storm in October 2017, MSC Susanna broke its moorings in the port of Durban and collided with the frigate Floreal of the French Navy (represented by the second respondent — the Ministère des Armées), as well as with port infrastructure belonging to Transnet (the first respondent in the guise of the National Ports Authority of South Africa (the NPA)). The NPA sued the appellants — the owners and underwriters, and the demise charterer of Susanna — for damages of R23 million. The appellants applied for a declaration of non-liability in relation to the damages to Floreal, for which the Ministère had lodged a counterclaim for €10 million.

2022 (2) SA p86

In November 2019 the appellants, invoking s 261(1)(b), instituted a limitation action against the NPA in the Durban High Court, seeking to join the Ministère to the action. The Ministère resisted, arguing that the limitation in s 261(1)(b) did not apply to warships like Floreal by virtue of s 3(6) of the Act.

The appellants on the other hand argued the limitation did apply against the Ministère, as the party making the claim against them, as opposed to Floreal itself. They submitted that s 261(1)(b) conferred a wide right that could not be restricted in the way the Ministère wanted, that is, by inserting after the words 'any property of any kind' in s 261(1)(b) the words 'save a naval vessel owned by the defence force of any nation'. The Durban High Court refused to join the Ministère.

In an appeal to the Supreme Court of Appeal the parties agreed that the issue was 'whether the owners and demise charterers of a merchant ship may, in circumstances where a merchant ship causes damage to a ship belonging to a defence force as contemplated in s 3(6) . . . seek a limitation of liability in terms of s 261 . . . in respect of the claim of that defence force'. It was common cause that if the answer favoured the appellants, the High Court should have ordered the joinder of the Ministère.

Held

The terms of s 261(1)(b) were clear and comprehensive: the right to limit was given to the owner of the ship in respect of all loss or damage to any property or rights of any kind, without qualification, and would include the loss or damage embodied in the Ministère's claim. The focus, therefore, had to be on the effect of s 3(6), which excluded the bulk of the provisions of the Act from application to both South African and foreign vessels forming part of their country's defence forces. But ch V part 4 (where s 261 was located) differed from the rest of these provisions since it was focused on the legal liability of owners and its limitation. This was important because s 3(6) did not say that the Act did not apply to owners of ships. It would, moreover, be linguistically inapt to exclude the invocation of limitation by the owners of Susanna. (See [7] – [8], [10] – [12], [14].)

The Ministère's argument that the Act was not concerned with warships (naval vessels) had to fail: Susanna was a merchant ship that was engaged in merchant shipping at the time of the incident giving rise to the claims against the appellants; the appellants were invoking a provision they were plainly entitled to invoke; and allowing them to limit their liability was clearly incidental to merchant shipping. (See [17.)

No discernible reason of policy supported a different construction of s 261(1)(b). Limitation of liability existed as a matter of policy and none of the international conventions on limitation excluded its invocation in respect of claims arising from damage done to or by naval vessels. An exemption from the right to invoke limitation in respect of claims by naval vessels would also be inconsistent with international practice. (See [25].)

There were also incongruities arising from the Ministère's argument: s 261 dealt with three situations, an occurrence causing loss of life or personal injury; an occurrence causing loss or damage to property or rights; and an occurrence causing both loss of life or personal injury and loss or damage to property or rights. Had the incident giving rise to this case resulted in loss of life or injury to naval personnel on board Floreal, they and the dependants of any who were killed could have brought actions against the appellants to recover damages. Any such claims would have been subject to limitation, and nothing in s 3(6) suggested that the officers and crew of Floreal would

2022 (2) SA p87

enjoy some special exemption from the application of limitation. It would be incongruous in such circumstances for the Ministère to escape the application of limitation. (See [26].)

Appeal upheld and the Ministère joined as defendant in the action instituted by the appellants. (See [28].)

Cases cited

Southern Africa

Atlantic Harvesters of Namibia (Pty) Ltd v Unterweser Reederei GmbH of Bremen 1986 (4) SA 865 (C): referred to

Nagos Shipping Ltd v Owners, Cargo Lately Laden on Board the MV Nagos, and Another 1996 (2) SA 261 (D): referred to

South African Railways and Harbours v Smith's Coasters (Prop) Ltd 1931 AD 113: referred to.

Canada

The Queen v Nisbet Shipping Co Ltd 1953 CanLII 77 (SCC) ([1953] 1 SCR 480): referred to.

England

Boucher v Lawson 95 ER 116: referred to

Dampskibs Aktieselskabet 'Mineral' of Narvik v Owners of Steamship 'Myrtlegrove' and Others [1919] 1 Lloyd's Rep 289 (Adm Div): referred to

Nisbet Shipping Co Ltd v Reginam [1955] 3 All ER 161 (PC): discussed.

Legislation cited

The Merchant Shipping Act 57 of 1951, s 3(6) and s 261(1)(b): see Juta's Statutes of South Africa 2020/21 vol 4 at 2-584 and 1-621.

Case Information

SR Mullins SC (with PJ Wallis SC) for the appellants.

CJ Pammenter SC (with D Cooke) for the respondents.

An appeal against a decision in the Durban High Court.

Order

1.

The appeal is upheld with costs, such costs to include those consequent upon the employment of two counsel.

2.

The order of the High Court is set aside and replaced by the following order:

'The rule nisi is confirmed in the following terms:

1.

The Ministère des Armées is joined as a defendant in the action instituted by the appellants under case No A4/2019.

2.

The appellants are granted leave to amend the pleadings in the said action so as to plead their cause of action against the Ministère des Armées.

3.

The Ministère des Armées is ordered to pay the costs occasioned by its opposition to the application, such costs to include those consequent upon the employment of two counsel.'

Judgment

Wallis JA (Navsa, Schippers, Mbatha and Gorven JJA concurring):

[1] On 10 October 2017, during a substantial storm in the port of Durban, the MSC Susanna broke her moorings and, while drifting in the

2022 (2) SA p88

Wallis JA (Navsa, Schippers, Mbatha and Gorven JJA concurring)

port, collided with several vessels, including the FNS Floreal. The Floreal was a French naval vessel under the control of the second respondent, the Ministère des Armées (the Ministry) of the French Republic. The MSC Susanna also collided with cranes and other infrastructure owned by the first respondent, Transnet SOC Ltd — the National Ports Authority of South Africa (the NPA). The NPA sued the appellants, respectively the owners and underwriters on the one hand, and the demise charterer on the other, of the MSC Susanna, for damages in an amount of some R23 million arising out of this incident. The Ministry's response to the appellants' action for a declaration of non-liability in relation to the damages to the Floreal was to lodge a counterclaim for damages amounting, together with interest and costs, to nearly €10 million.

[2] Given the value of the actual and potential claims against the appellants, on 7 November 2019 they issued a writ of summons in a limitation action against the NPA, contending that their total liability for damages arising out of the events of 10 October 2017 should be limited in terms of the provisions of s 261(1)(b) of the Merchant Shipping Act 57 of 1951 (the MSA). On the same day they launched the present proceedings seeking the joinder of the Ministry to the limitation action. The application was resisted by the Ministry on the grounds that, as the owner of a foreign naval vessel, the right to limit was excluded as against it by the provisions of s...