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TMI Blog1990 (3) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... the bills of lading the parties could not resile therefrom. It is not clear whether the English Carriage of Goods by Sea Act, 1924 or the Indian Carriage of Goods Act, 1925 was applied by the High Court. The Articles and the Rules referred to are to be found in the Schedule to the Indian Act, the Rules whereunder were not applicable to the facts of the case. The dispute could not have been decided partly according to municipal law and partly according to English law. The English law was not proved before the court according to law. The result is that this appeal must succeed. We accordingly allow this appeal, set aside the impugned judgments and remand the case to the trial court for disposal according to law after giving opportunity to the parties to amend their pleadings and adduce additional evidence, if they are so advised, in light of the observations made hereinabove. - 764(N) of 1975 - - - Dated:- 13-3-1990 - K.N. Saikia and P.B. Sawant, JJ. REPRESENTED BY : Mr. R.F. Nariman, Mrs. A.K. Verma and Mr. D.N. Mishra, Advocates, for the Appellants. Mr. Ramamurthi, Advocate (Not present), for the Respondents. [Judgment per : K.N. Saikia, J.]. - The first respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted, as the carrier under clause 3 of the bill of lading, only the appellant has an option either to sue or be sued in England, or in Cochin, which is a port of destination but the shipper had no option to sue at Cochin. In its written statement it was clearly stated that it had appeared under protest and without prejudice to the contention regarding jurisdiction which contention it had also pressed at the time of the argument, and, therefore, it could not be said to have submitted to the jurisdiction of Cochin court; and it never made any submission or raised any objection as to the fact of short-landing. According to counsel the High Court has held clause 3 of the bill of lading to be bad on two erroneous grounds, namely, that it offends Section 28 of the Contract Act and that it gives an unfair advantage to the carrier which advantage is not given to the consignee. Section 28, according to counsel, is not applicable and clause 3 was not bad on the ground of having given an unfair advantage to the carrier in giving him the option to sue or be sued either in England or at the port of destination and that even if it was bad, only the offending portion could be struck off, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clause 3 of the Bills of Lading which reads as follows : 3. JURISDICTION : The contract evidenced by this bill of lading shall be governed by English law and disputes determined in England or, at the option of the Carrier, at the port of destination according to English law to the exclusion of the jurisdiction of the Courts of any other country. If the above clause was binding on the first respondent, without anything more, there could be no doubt that the suit claim arising out of the contract of affreightment evidenced by the bills of lading will have to be determined in England or, at the option of the carrier, that is the appellant, at the port of destination, that is, Cochin, to the exclusion of the jurisdiction of the courts of any other country. Is the first respondent bound by this clause of the Bill of Lading? 8. Clause 29 of both the bills of lading Exhibit P1 and P2 runs as follows : FINALLY IN ACCEPTING THIS BILL OF LADING. The Shipper, Consignee, and Owner of the goods, and the Holders of this Bill of Lading, expressly accept and agree to all its stipulations, exceptions, and conditions whether written, printed, stamped or incorporated, as fully as if they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or endorsement and the right to sue passes with it. The consignee or endorsee may lose his right or liability under the Act by such further endorsement of the bill of lading as divests him of the property. Such a vesting of rights and liabilities on endorsement of a bill of lading does not in any way affect the ship-owners rights against the original shippers or owners of the goods for the freight or the shipper s rights under the bill of lading or the liability of the consignee or indorsee by reason of his being such consignee or indorsee, or of his receiving the goods in consequence of such consignment or indorsement, or any right of stoppage in transitu. 12. The Indian Bill of Lading Act, 1856 was based on the English Bills of Lading Act, 1855 (18 and 19 Vict. C. 111) (Act IX of 1856). Under Section 1 of the Indian Bills of Lading Act, 1856 also every consignee of goods named in a bill of lading and every endorsee of a bill of lading to whom the property in goods therein mentioned shall pass, upon or by reason of such consignment or endorsement, shall have transferred to and vested in him all rights of suit, and be subject to the same liabilities in respect of such goods as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by English law, or (iv) contains a term to the effect that the court shall have jurisdiction to hear and determine any action in respect of the contract." Rule 34 deals with jurisdiction clauses and it says : (1) Where a contract provides that all disputes between the parties are to be referred to the jurisdiction of the English courts, the court normally has jurisdiction to hear and determine any action in respect thereof. (2) Subject to clause (3) of this Rule, where a contract provides that all disputes between the parties are to be referred to the exclusive jurisdiction of a foreign tribunal, the English court will stay proceedings (or, as the case may be, refuse to give leave to serve the writ out of the jurisdiction) instituted in England in breach of such agreement, unless the plaintiff proves that it is just and proper to allow them to continue. (3) Where the case falls within the scope of the 1968 Convention, unless the defendant submits to the jurisdiction, the court has no jurisdiction to determine a dispute. (a) if one or more of the parties is domiciled in a Contracting State and the parties have agreed in accordance with Article 17 of the 1968 Conventio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh seas, or her foreign owners or their agents in a foreign country, are not deprived of rights by our statutory enactment expressed in general terms unless it provides that the foreign ship entering an Indian port or territorial waters and thus coming within the territorial jurisdiction is to be covered. If the Parliament legislates in terms which extend to foreign ships or foreigners beyond the territorial limits of its jurisdiction, the Indian court is of course bound to give effect to such enactment. However, no such provision has been referred to in the impugned judgments. Without anything more Indian statutes are ineffective against foreign property and foreigners outside the jurisdiction. 19. The Privy Council in Sirdar Gurdyal Singh v. Rajah of Faridkote (1894) AC 670 (684) decided that no territorial legislation can give jurisdiction in a personal action which any foreign court should recognise against absent foreigners owing no allegiance or obedience to the power which so legislates. Lord Selborne said : In a personal action to which none of these causes of jurisdiction apply, a decree pronounced in absentem by a foreign court, to the jurisdiction of which the defen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e principal grounds for selecting a particular national jurisdiction in which to bring an action are that the subject of the action, if a thing, is situate, if a contract, was made, or was to be performed, if a delict, was committed, within the territory : hence the forum situs, or rei sitae, contractus, delicti, the two latter of which are classed together as the forum speciale obligationis. Or that the jurisdiction is that in which all the claims relating to a certain thing or group of things ought to be adjudicated on together, the forum concursus, or that to which the defendant is personally subject, the forum rei. 23. In the instant case the appellant submits that as defendant it appeared before the Indian court to protest its jurisdiction and put forth its defences subject to that protest. The appellant, it has been stated in para 2 of the judgment under appeal, dated 30-4-1973, had not filed any objection to the findings as to damages. Did it then amount to submitting to the jurisdiction of the Indian court in which the shipper or the first respondent had no right to sue? 24. In Williams Glyn s Bank PLC v. Astro Dinamico Compania Naviera S.A. Anr.,The Weekly Law Rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said at page 850 : I cannot see how anyone can fairly say that a man has voluntarily submitted to the jurisdiction of a court, when he has all the time been vigorously protesting that it has no jurisdiction. If he does nothing and lets judgment go against him in default of appearance, he clearly does not submit to the jurisdiction. What difference in principle does it make, if he does not merely do nothing, but actually goes to the court and protests that it has no jurisdiction? I can see no distinction at all. 25. The judgment of the court of appeal which held that the application for a stay involved assumption that the court had jurisdiction to entertain the action and therefore the question of jurisdiction must be decided first, was set aside in appeal, and the appeal therefrom was dismissed by the House of Lords. 26. In the instant case the question is of initial jurisdiction on the basis of clause 3 of the bills of lading. We have to ask the question whether the shipper could or could not have the right to sue at Cochin under the bills of lading. If he could not have done so, the appellant s appearance to protest about jurisdiction would not cure that defect of jurisd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rule 2 : When the intention of the parties to a contract with regard to the law governing the contract is not expressed in words, their intention is to be inferred from the terms and nature of the contract, and from the general circumstances of the case, and such inferred intention determines the proper law of the contract. There can, therefore, be no doubt that the instant contract of affreightment evidenced by the bills of lading will be governed by English law. As the law has been chosen, the proper law will be the domestic law of England and the proper law must be the law at the time when the contract is made throughout the life of the contract and there cannot be a floating proper law. It has been recognised since Gienar v. Meyer (1796) 2 Hy B1 608, that at the time of making the contract the parties may expressly select the law by which it is to be governed and they may declare their common intention by a simple statement that the contract shall be governed by the law of a particular country. This has been settled by a long line of decisions, as Rex v. International Trustee for the Protection of Bondholders AG (1937) A.C. 500 (529); Vita Food Products Inc. v. Unus Shi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bill of lading is evidence of the terms of the contract which can also be ascertained from the charterparty where one exists. Dr. Justice T. Kochu Thommen in his book of Bills of Lading in International Law and Practice at page 25 writes : As between the shipowner and the shipper, the bill of lading is not conclusive evidence of the terms of the contract and parties to the contract are entitled to prove that the stipulations in the bill of lading are at variance with the agreed terms of the contract, as expressed or evidenced in other documents. In practice, however, the terms of the bill of lading govern the contractual relations between the shipowner and the shipper, and the booking note generally states that the carrier s regular forms of bill of lading shall be used and all the terms thereof shall form part of the contract. The bill of lading assumes the character of conclusive evidence once it has passed into the hands of a consignee or indorsee and evidence may not be given which varies or contradicts it. The position is, however, different when the ship is under charter and stipulations in the charerparty are expressly and clearly incorporated in the bill of lading. In s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he terms and conditions of the contract which are hereby mutually agreed upon as follows . Clause 7 contained a general exemption in respect of the goods carried from liability for all damage capable of being covered by insurance and from liability above a certain value per package unless a special declaration was made. The same clause also provided that these contracts have been governed by English Law. While determining what was the proper law of the contract the Privy Council held that the expressed words of the bill of lading must receive effect with the result that the contract was governed by English Law. It was said : It is now well settled that by English Law (and the law of Nova Scotia is the same) the proper law of the contract is the law which the parties intended to apply. That intention is objectively ascertained, and, if not expressed, will be presumed from the terms of the contract and the relevant surrounding circumstances. In that case the goods were shipped in Newfoundland under bills of lading which did not contain the statement required by Section 3 of the Carriage of Goods by Sea Act, 1932 which incorporated the Hague rules subject to certain modifications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This is in conformity with Private International law applicable to the case. 39. The Indian Carriage of Goods by Sea Act, 1925 (Act XXVI of 1925) is an Act to amend the law with respect to carriage of goods by sea. It was passed after accepting the recommendations of the International Conference on Maritime Law held at Brussels in October, 1922 and accepting the rules contained in the Draft Convention held at Brussels meeting in October, 1923 amending the rules to give the rules the force of law with a view to establish the responsibilities, liabilities, rights and amenities attaching to carriers on the bills of lading. But the Rules of the Act are not applicable to this case. 40. The High Court rejected the contention of the appellant that it could not be made personally liable for claim on the grounds that the bills of lading were issued in the printed forms of the appellant company bearing its name at the top and that beyond what appeared at the bottom over the signature and seal, there was nothing at all to indicate that the appellant company was issuing the bills of lading for and on behalf of any owners of the vessel. However, the conditions printed on the reverse of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between the charterer and the owner of the ship. If the charter is by way of demise the problem would be simple inasmuch as the bill of lading will be purely between the shipper and the charterer. In cases of a `voyage charter or a `time charter one has to find out the actual terms of the charter to ascertain whether they operated as charter by demise or made the charterer only as an agent of the shipowner and if so to what extent so as to ascertain the extent of privity established between the shipper and the shipowner as stipulated in the bill of lading. 44. Charterparties by way of demise, says Halsbury, at para 403, are of two kinds : (1) charter without master or crew, or bareboat charter", where the hull is the subject matter of the charterparty, and (2) charter with master and crew, under which the ship passes to the charterer in a state fit for the purposes of mercantile adventure. In both cases the charterer becomes for the time being the owner of the ship; the master and crew are, or become to all intents and purposes, his employees, and through them the possession of the ship is in him. The owner, on the other hand, has divested himself of all control either over ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, of which the most important is the position of the shipper and of the holder. Where there is a bill of lading relating to the goods, the terms of the contract on which the goods are carried are prima facie to be ascertained form the bill of lading. However, if a shipper chose to receive a bill of lading in a certain form without protest he should ordinarily be bound by it. Thus, it cannot be said that the bill of lading is not conclusive evidence of its terms and the person executing it is not necessarily bound by all its stipulations, unless he repudiates them on the ground that, as he did not know, and could not reasonably be expected to know, of their existence, his assent to them is not to be inferred from his acceptance of the bill of lading without objection. Where there is a charterparty, the bill of lading is prima facie, as between the shipowner and an indorsee, the contract on which the goods are carried. This is so when the indorsee is ignorant of the terms of the charterparty, and may be so even if he knows of them. As between the shipowner and the charterer the bill of lading may in some cases have the effect of modifying the contract as contained in the charterp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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