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2016 Supreme(Bom) 56
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
S.C. GUPTE, J.
Murmansk Shipping Company - Petitioner
Vs.
Adani Power Rajasthan Ltd. & Ors. – Respondents
ADMIRALTY SUIT NO.43 OF 2012
Decided on : 8-1-2016
Advocate Appeared:
Mr. Atul Rajadhyaksha, Senior Advocate, a/w. Mr. Zarir Bharucha, Mr. Shivam Singh, Mr. Archit Dhir and Mr. Rahul Rajpurohit, i/b. Bimal Rjasekhar, for the Plaintiff.
Mr. Nevroz Seervai, Senior Advocate, a/w. Mr. Rahul Narichania, Senior Advocate, Mr. Amitava Mazumdar, Mr. Shiv Kumar Iyer, Mr. Siddharth Ranka, Ms. Ramya Dharmaraj and Mr. Anil Vishnoi, i/b. Bose and Mitra and Co., for the Defendants.
Important Point – Institution of a prior legal proceeding in HIgh Court against concerned vessel or its owner cannot be said to be a precondition for maintainability of a suit for constitution of a limitation fund for claims against vessel which are subject to limitation.
Headnote:(A) Merchant Shipping Act, 1958 – Section 352A – Constitution of limitation fund in connection with operation of vessel for claims falling under Section 352A – There is indeed nothing in Section 352C(1) to require plaintiff to show that either any third party has actually alleged that plaintiff has incurred liability in respect of claims arising out of a marine occurrence or has actually instituted a liability action against plaintiff in respect of any such claim---All that Section requires is that plaintiff must have allegedly incurred a liability in respect of claims arising out of the occurrence. This may be the plaintiff's own case. Even as regards the second requirement, namely, institution of legal proceedings, there is nothing in Section 352C to imply that such proceeding ought to be instituted against plaintiff---It may well be proceeding instituted by plaintiff himself---There is nothing to show that proceedings must be for enforcement of a claim or a liability action---It may well be proceedings for avoiding enforcement of a claim or an action for limiting liability towards such claim.
(B) Merchant Shipping Act, 1958 – Section 352A – Constitution of limitation fund in connection with operation of vessel for claims falling under Section 352A – Institution of a prior legal proceeding in this Court against concerned vessel or its owner cannot be said to be a precondition for maintainability of a suit for constitution of a limitation fund for claims against vessel which are subject to limitation.
(C) Civil Procedure Code, 1908 – Section 11 read with Rule 1(4) of Order 23 – Rule of res judicata applies to a case where suit or issue has already been heard and finally decided by a Court, whereas case of abandonment or withdrawal of suit or claim without permission of Court, where there is no adjudication involved, is covered by Rule 1(4) of Order 23 – If suit or any part of claim is abandoned or withdrawn without permission of Court referred to in sub-rule (3), no second suit lies under Sub-rule (4) of Rule 1.
(D) Statute Law – Concept of legislation by reference – Where legislature refers to a statute by a mere reference or citation, which makes any modification, repeal or reenactment of that statute to have effect on referring statute – Unlike in case of legislation by incorporation, where incorporated statute becomes an integral part of incorporating statute and remains frozen as of date of incorporation, in former case the referred statute applies in its amended form for time being in force as and when its application is invoked.
(E) Statute Law – Delegation of legislative power – Application of a future amendment to referred or cited law as a governing rule of conduct per se does not amount to excessive delegation of legislative power – Referring or citing statute may consist of sufficient guidance for delegate – This may be in form of a clear enunciation of legislative policy in parent statute for carrying out its purpose – Quantum of fund is, by its very nature, an international standard and there is nothing excessive about adopting that standard even for future periods so long as India accedes to the same – By its very nature, it is a matter to be left to executive government – Such delegation does not change basic legislative will expressed by Parliament in Amending Act 68 of 2002, but rather reflects and accords with that will.
Result – Suit decreed.
This admiralty suit is filed by a shipowner seeking constitution of a limitation fund in connection with the operation of the vessel for claims falling under Section 352A of the Merchant Shipping Act, 1958 (“MS Act”).
2. The Plaintiff is a company incorporated under the laws of Russia, and was at all material times and still is the owner of the vessel M.V. YURIY ARSHENEVSHKY (“the vessel”), which flies Russian flag and is registered at the port of Murmansk in Russia. The suit was originally filed against two defendants. Defendant No.1, an Indian company registered under the Companies Act, 1956, was a consignee of cargo on board the vessel, whose cargo was lost during the voyage, and who has lodged a formal claim for loss of cargo. Defendant No.2 is described as “all persons claiming or entitled to claim damages by reason of or arising out of loss/damage to cargo carried on board” the vessel from Tianjin and Shanghai in China to Mundra and Mumbai in India in August-November 2011.
3. The vessel, which was chartered under an amended NYPE charterparty dated 14 April 2011 and subsequently sub-chartered, was ordered to load project cargo at the Chinese Ports of Tianjin and Shanghai for carriage to Mundra and Mumbai in India. On 22 July 2011, the vessel arrived at Tianjin for loading. It was birthed on 24 July 2011 and commenced loading. The loading was completed on 27 July 2011, but the vessel did not sail immediately as it needed lashing of cargo. After accomplishing the requisite lashing, the vessel departed for Shanghai, with 2388 MT of project cargo loaded at Tianjin. It arrived in Shanghai on 20 July 2011 and loaded further 6322 MT of cargo there. The cargo was loaded in holds and also as deck cargo. During the loading, the deck officers, who checked the condition of the cargo, made adverse comments about its condition and packaging. This led to the clausing of the shipping orders in respect of the cargo to the effect that the vessel was not to be responsible for any loss caused by carriage of the deck cargo (identifying such cargo specifically). After loading the cargo, the lashing of the deck cargo took some time. In the meantime, the Master of the vessel received a communication from the sub-charterer's agents engaged for weather routing of the voyage from China to India that typhoon “Muifa” was developing en route. The Master was advised not to set sail for sometime till the vessel was expected to be out of the gale radius. A decision was made thereupon by the Master to move the vessel to Chejndo island in South Korea and remain in the shelter of the island until the typhoon passed. This was with the agreement of the owners and sub-charterers.
After obtaining further updates on weather conditions, the vessel departed from Shanghai, heading towards Chijndo island on 5 August 2011. Whilst the voyage was underway, on 6 August 2011, the weather reports showed that the typhoon had changed to a more northernly direction and would miss Shanghai and the track adjacent to the Chinese coast. After additional lashing of the cargo, modifying the vessel's movement and making course/speed adjustments to ensure clearance from the typhoon, the vessel kept sailing. It, however, experienced heavy rolling and pitching, sometimes even upto 50 degrees. In the process, despite best efforts to reduce the rolling and pitching, the deck cargo stowed on hatches 1, 2, 3 and 4 and one stack of cargo at hatch 5 was lost. The vessel thereafter altered its course. It was thereupon advised by the sub-charterer to go to Xiamen in China, where the vessel was birthed and the cargo in the holds was relashed.
The defects noticed in the vessel from the damage caused by shifting of cargo during the typhoon were rectified. Thereafter the Port State Control Officers inspected the vessel and certified that all deficiencies had been rectified. Before the vessel could set sail post such certification, she was arrested by two cargo interests for cargo meant to b
