The immunity from liability under Clause 3 of paragraph 6 of Article III in the Schedule to the Carriage of Goods by Sea Act, 1925, is available only if the Bill of Lading contains an express statement that it is subject to the provisions of the Rules as applied by the Act.

Headnote:
JURISDICTION - CARRIAGE OF GOODS BY SEA ACT, 1925 - SECTION 2, 4 - BILL OF LADING - CLAUSE 26, 27 - LIMITATION ACT, 1963 - ARTICLE 10 - CONTRACT - INTERPRETATION - IMMUNITY FROM LIABILITY - EXPRESS STATEMENT IN BILL OF LADING - JURISDICTION OF COURT - SUBMISSION TO JURISDICTION - PLEA ON MERITS - WAIVER OF OBJECTION TO JURISDICTION.
Fact of the Case:

Plaintiffs filed a suit against defendants, a steamship company, for recovery of the value of palmyrah fibre delivered in a rotten condition. The defendants pleaded that the Court at Kakinada had no jurisdiction to entertain the suit in view of Clauses 26 and 27 of the conditions of the bill of lading, which provided that all claims and disputes arising under and in connection with the bill of lading shall be judged in the USSR and shall be determined according to the Merchant Shipping Code of the USSR. The defendants also contended that the suit was barred by limitation under Clause 3 of paragraph 6 of Article III in the Schedule to the Carriage of Goods by Sea Act, 1925, as it was not filed within one year of the date of delivery of goods.
Finding of the Court:

The Court held that the defendants were not entitled to the benefit of immunity contained in Clause 3 of paragraph 6 of Article III in the Schedule to the Carriage of Goods by Sea Act, 1925, since the Bills of Lading did not contain a specific provision as to the application of the rules of the Act. The Court also held that the Court at Kakinada had jurisdiction to try the suit as the defendants had submitted to the jurisdiction of the Court by pleading on the merits of the case.
Issues: 1. Whether the Court at Kakinada had jurisdiction to entertain the suit in view of Clauses 26 and 27 of the conditions of the bill of lading? 2. Whether the said clauses in that bill of lading were illegal as contended by the plaintiff? 3. Whether this Court has no jurisdiction to entertain this suit for the reasons urged in Para. 4 of the written statement? 4. Whether the defendants are discharged from all liability in respect of damage to the suit consignment for the reasons urged in para, 19 of the written statement? 5. Whether the defendant submitted to the jurisdiction of this Court and therefore are precluded from questioning the jurisdiction.
Ratio Decidendi: 1. The immunity from liability under Clause 3 of paragraph 6 of Article III in the Schedule to the Carriage of Goods by Sea Act, 1925, is available only if the Bill of Lading contains an express statement that it is subject to the provisions of the Rules as applied by the Act. 2. The mere reference to the provisions of the Carriage of Goods by Sea Act in the plaint does not make the provisions of the Act applicable to the contract, if the Bill of Lading does not contain a specific statement as to the application of the rules. 3. A defendant who pleads on the merits of the case submits to the jurisdiction of the Court and cannot be permitted to question the jurisdiction of the Court.
Final Decision: The revision petition filed by the defendants was dismissed with costs.

( 1 ) THE Far Eastern Steamship Company, also known as Fesco Lines, Vladivostok, carrying on business at Kakinada, through their agents M/s. D. S. Narayana and Company, Kakinada, the defendants in the suit O. S. No. 267 of 1972 on the file of the Court of the Subordinate Judge, Kakinada, are the petitioners. The first plaintiff in the suit are Koika Trading Company Ltd. , Osaka Japan and second and third plaintiffs are New India Assurance Company Limited, Bombay and Aspinwall and Company Limited, Cochin and Kakinada. The defendants area steamship company incorporated in U. S. S. R and carry on business as common carriers by Sea and carry for reward goods inter alia from ports of India to Japan. The defendants are the owners and/or charterers of the ship. "m. V. Kolya Mygotin", hereinafter referred to as the ship at all material times. The first plaintiffs are a Limited Company incorporated in Japan and carry on business as importers and exporters having their head office at Osaka, Japan. The plaintiffs filed the suit against the defendants for recovery of Rs. 58,866. 33 ps. being the value of 329 bales of palmyrah fibre delivered by the defendants in a rotten condition.

( 2 ) THE case of the plaintiffs briefly stated is :that in Feb. , 1971 the third plaintiff booked 370 bales of palmyrah livered the consignments in a securely and properly packed condition to M/s. D. S. Naryan and Company for carriage from Kakinada to Kobe by the Ship, that the defendants-agents issued receipts in the form of bills of lading for and on behalf of the defendants Nos. KK-14, KK-15 and KK-16 dated 27-2-1971 marked as Exts. A-1 to A-3 for the said consignments acknowledging that the said consignments were received on board the Ship in good order and condition, that the Ship arrived with the goods at Kobe on or about 9-4-1971 and delivered the consignments to the first plaintiffs and that that after survey it was found that the three consignments consisting of 359 bales of palmyrah fibre were in a damaged and rotten condition due to the negligence of the defendants, for which the defendants were liable to make good the loss.

( 3 ) THE first plaintiffs briefly sent a preliminary notice of claim to M/s. Kumagai Kaiun Kaisha Limited, Kobe on 7-5-1971. But the claim was repudiated by the Agents of the defendants by their reply dated 9-7-1971 stating their inter alia that the damages were probably caused by the stress of bad weather the ship encountered in the voyage. A copy of the Marina Protest filed at Tokyo, Japan by the Master of the Ship was also sent. Thereafter the plaintiffs submitted their claim through their agents M/s. V. L. N. C. Narichauia (P) Ltd. , Bombay to the defendants on 2-2-1972 and suggested amicable settlement of the claim and further stated that since the claim would attract limitation the claim may be settled immediately. By their cable dated 28-2-1972, the claims agents of the plaintiffs suggested expeditious settlement and extension of time for six months with effect from 1-4-1972. As no cable was received form the defendants, they sent another cable on 14-3-1972 and later on 16-3-1972 to expedite the reply failing which the plaintiffs would file a suit. The defendants then replied by their cable dated 16-3-1972 extending time by six months. Later the defendants, referred the claim to their agents M/s. D. B. Madan and co. Madras, who by their letter dated 27-5-1972 repudiated the claim. The plaintiffs thereafter filed the suit.

( 4 ) THE main defence of the defendants in the suit was that the Court at Kakinada had no jurisdiction to entertain the suits in view of Cls. 26 and 27 of the conditions of bills of lading. According to the defendants, as per the said clauses, all claims and disputes arising under and in connection with the bill of lading shall be judged in the USSR and shall be determined according to the Merchant Shipping Code of the USSR and the above said clauses in the bill of lading were perfectly valid and bindi

Click Here to Read the rest of this document

1978 Supreme(AP) 120

Andhra Pradesh High CourtJudges : CHENNAKESAVA REDDYFor Eastern Stemship Co., Kakinada - AppellantVersusokia Trading Co.Ltd. - RespondentDecided On : 03-24-78

The immunity from liability under Clause 3 of paragraph 6 of Article III in the Schedule to the Carriage of Goods by Sea Act, 1925, is available only if the Bill of Lading contains an express statement that it is subject to the provisions of the Rules as applied by the Act.

Andhra Pradesh High Court
Judges : CHENNAKESAVA REDDY
For Eastern Stemship Co., Kakinada - Appellant
Versus
okia Trading Co.Ltd. - Respondent
Decided On : 03-24-78