FEDERAL COURT OF AUSTRALIA

Tiezone Pty Ltd v Schenker Stinnes Logistics [2003] FCA 281

Carriage of goods – service ex juris

TIEZONE PTY LTD & ANOR v SCHENKER STINNES LOGISTICS & ORS

N1112 of 2002

ALLSOP J

26 MARCH 2003

SYDNEY

THE COURT ORDERS THAT:

1.    Leave be granted to the plaintiffs subject to compliance with Div 2 of O 8 in respect of the first and third defendants and Div 3 of O 8 in respect of the fourth defendant to serve the application and amended statement of claim (appropriately amended as to name) outside Australia on the first, third and fourth defendants;

2.         The question of costs be reserved.

3.         The plaintiff file an affidavit setting out any information concerning the loss in question on or before Friday 28 March 2003.

4.         The matter be stood over to a date to be fixed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

1                     This is a notice of motion brought by the plaintiffs seeking leave to serve an application and an amended statement of claim outside the jurisdiction under Order 8 of the Federal Court Rules. 

2                     I take the following from the evidence before me, from what I have been informed from the bar table and from the amended statement of claim by way of background facts.  I should add that I have received two affidavits from the plaintiffs’ solicitor, Mr O'Reilly, and I have required him to place on record in an affidavit by this coming Friday, 28 March 2003, the matters which I am presently prepared to accept from him from the bar table.

3                     The requirement to put these matters on affidavit does not reflect in the slightest way my acceptance of the reliability of what Mr O'Reilly says.  However, in the exercise of the exhorbitant jurisdiction of the court under Order 8 I think it appropriate that the court reflect clearly in evidential terms the matters which have been said to me from the bar table.

4                     The first plaintiff is an importer and seller of wine in Sydney.  Prior to 6 December 2001, it agreed to purchase wine from the second plaintiff for export to Australia. 

5                     The proceedings concern 809 cartons of wine which were allegedly damaged by being frozen some time in the voyage from France to Australia prior to collection in Sydney.  The damage after salvage is in the order of some hundreds of thousands of dollars. 

6                     The first defendant (Schenker Stinnes) is a French freight forwarder.  On 6 December 2001, it issued a house bill to the second plaintiff (as shipper/exporter) with the business name of the first plaintiff identified as consignee and notify party.

7                     The goods were identified as contained within a 120 foot reefer to be held at + 13 to + 15 degrees celsius.  The bill is prima facie evidence of a contract for carriage between the first defendant and the first plaintiff for carriage of goods delivered to the first defendant in apparent good order and condition from the Port of Le Verdon at the mouth of the Gironde, near Bordeaux in France, to the port of Sydney. 

8                     It was a term of the bill that unless marked “not negotiable” the bill was in effect negotiable by endorsement.  The bill was not so marked.  The “Merchant” was defined in the bill as meaning and including the shipper, consignee, holder of the bill, receiver and owner of the goods.  This definition is wide enough to cover both the first and second plaintiffs. 

9                     Thus there is prima facie evidence before me of a contract for carriage to which both plaintiffs were parties and of a bill on which one or both plaintiffs was and were entitled to sue. 

10                  The contract for carriage was made in France, but required the delivery of goods in good order and condition in Sydney.  There is a prima facie case before me that the goods were damaged by freezing prior to collection in Sydney.  Thus there is a prima facie case against the first defendant under O 8 r 1, pars (a) and (aa).

11                  The first defendant arranged for the carriage of the wine under a bill of lading apparently issued by the second defendant, Mediterranean Shipping Company SA (MSC).  The second defendant, MSC, is a Swiss company.  The bill (the ocean bill) has the form of a non-negotiable, or “straight” bill on which the first defendant is the shipper and an apparently related company, identified only as “Schenker (Australia) Sydney” is consignee and notify party.  The ocean bill was not transferred to either plaintiff.  It represents the first defendant's method of contractually performing its obligations under its own bill (the house bill) with the plaintiffs.  As in the house bill, the ocean bill identified Le Verdon as the port of loading and Sydney as the port of discharge and the relevant reefer to be carried at + 13 to + 15 degrees celsius.

12                  Both the house bill and the ocean bill nominated the vessel "Biscay" (the first vessel) to carry the cargo.  Evidence from the Lloyds Register of Ships reveals that the “MSC Biscay” was owned by a company which is the third defendant, m.s. “Mare Tuscum” Schiffahrtsgesellschaft mbH & Co KG.  The application and amended statement of claim still misname this party.  The Court documentation should be corrected.

13                  The management company of the first vessel appears, from the register, to be in Bremen, Germany. 

14                  There is no evidence before me of the relationship between the second defendant (MSC) and the owner of the first vessel.  One would assume, in the ordinary course, that some form of charter arrangement subsisted between the second defendant and the third defendant whether voyage, time or other.

15                  Thus, the plaintiffs have not shown, because they do not know, the terms on which the goods were held and carried as between the second and third defendants.  There is in the possession of the plaintiffs the front page of the ocean bill, but I have not had tendered the terms of carriage of the ocean bill on the back page of the bill.  The ocean bill of itself provides prima facie grounds to conclude that the second defendant took possession of the goods.  If the chartering arrangement was a voyage or time charter I could infer that, arguably, in addition, or alternatively, the third defendant had possession of the goods by control of the ship.  If there were a bareboat charter it would be difficult to see how the third defendant had possession of the goods through control of the ship.

16                  The wine was transhipped on to the vessel “MSC Nuria” (the second vessel) at Antwerp.  The evidence discloses that the Nuria is owned by the fourth defendant (another Swiss company) and managed by the second defendant. 

17                  Again, it is not clear what precise arrangements existed between the ship owner (the fourth defendant) and the second defendant as issuer of the ocean bill (and as apparent manager of the second vessel).

18                  Nevertheless, the third and fourth defendants are the owners of the first and second vessels, and the second defendant manages the second vessel for the fourth defendant.  Without further explanation, it is open to conclude, on a prima facie basis, that the third and fourth respondents had sufficient control of the property owned by them to be in possession of the goods as bailees.

19                  The first plaintiff appears, on a prima facie basis, to have suffered loss in Australia so as to satisfy par (ad). 

20                  Some further information is known about the background to the loss.  The vessel apparently called in at Le Havre after leaving Le Verdon and prior to reaching Antwerp and transhipping the reefer.  Mr O'Reilly is in possession of information supplied by a practitioner in Australia apparently acting for the second defendant that there may well have been a temperature probe problem revealed on the first vessel prior to calling in at Le Havre and which may or may not have been fixed adequately.  The Partlow chart in the reefer does not apparently disclose, with any conclusiveness, where the problem arose.  That may say something about the Partlow chart, but nevertheless it is not clear that the damage occurred in the voyage before transshipment at Antwerp or thereafter. 

21                  Reliance is placed by Mr O'Reilly on par (h).  I do not think that part of the rule is apposite, it is not intended it seems to me to cover injury to goods while being carried to Australia merely because those goods are now in Australia.  I heard no detailed argument on this paragraph, save for an assertion that it was relied upon.  At present I am not persuaded that the paragraph is appropriate. 

22                  I prefer to base my conclusions on pars (ad) and (g). 

23                  In relation to par (g), the plaintiffs have brought suit against the stevedores as another possible party responsible.  The stevedores have appeared and have been excused from further attendance until these questions of service are dealt with.  Whilst this has been done at their request to minimise costs, until all the parties are before the court, the stevedores have not indicated that they are inappropriately joined as a party, though they no doubt will wish to deny liability.  Thus, it seems to me that par (g) is arguably attracted.

24                  The claims against the shipowners are in negligence and bailment, not contract, the ocean bill not being a bill to which the plaintiffs are or were parties.  Given the nature of the damage, the freezing of the wine in a reefer prior to collection, there is plainly an onus to be discharged by any person with sufficient possession for a bailment count.  Also, reliance can perhaps be placed on the doctrine of res ipsa loquitur in relation to negligence, although the application of that doctrine where it is not clear whether one or more, and if so, which of the defendants is or are responsible, may be open for argument.

25                  In all the circumstances, and subject to Mr O'Reilly filing a further affidavit, setting out the extent of his knowledge and conclusions as a practitioner, about the possible source of the problem, the transhipment at Antwerp and what is known about the background to the damage, and subject to the names of the parties being corrected, I propose to grant leave to the plaintiffs, subject to compliance with Division 2 of Order 8 in respect of the first and third defendants and Division 3 of Order 8 in respect of the fourth defendant, to serve the application and amended statement of claim outside Australia on the first, third and fourth defendants.

26                  From my enquiries and from the evidence, it is plain that France and Germany are Convention countries but Switzerland is not and that is why Division 2 of Order 8 is appropriate for the first and third defendants, the first defendant being apparently resident as a corporation in France and the third defendant having its manager in Germany. 

27                  The Lloyds Register documents make clear that the manager of a 22 vessel fleet which includes the MSC Biscay, is Hansa Mare Reederei GmbH & Co. KG, with an address in Bremen.  I can take judicial notice, I think, in this industry, that the manager of a fleet of what appears to be one-ship companies, will have authority to accept service and, is the appropriate party, to serve process upon.  If there is any doubt about this, a corporate search could no doubt be taken to ascertain the corporate address of the third defendant.  The fourth defendant as I have said is a Swiss company; it is the owner of the second vessel. 

28                  Switzerland is not a Convention country.  The second defendant is also a Swiss company.  It is the second vessel’s manager.  The second defendant, through local solicitors, has indicated that it will accept service, through the local solicitor, for itself.  It does not appear to have been willing to accept service in Australia on behalf of the fourth defendant; therefore service will have to be made on the fourth defendant in Switzerland.

29                  Again the question arises as to whether or not that service should be on the second defendant in Switzerland or the fourth defendant in Switzerland.  Again I would have thought, in the ordinary conduct of maritime affairs, that service on the managing company should suffice. 

30                  Nevertheless it may be more appropriate, in consultation with the Registrar, for inquiries to be made as to the corporate addresses of the third and fourth defendants in Europe and for service to be effected both on the managers and on the ship owners.  It may be that consultations with the local solicitor for the second defendant can avoid any argument in due course that the vessels’ managers were served and not the ship owners and so invalidating, or in some fashion comprising, service.

31                  This is an ex parte application by Mr O'Reilly.  The matter has been before me a couple of times because I have wanted further clarification of some of the facts.  The application is for the exercise of what is described as the exhorbitant jurisdiction of the Court.  However, Schenker Stinnes is a worldwide freight forwarder.  It has a subsidiary in this country.  Mr O'Reilly has been corresponding with that subsidiary.  The subsidiary of course was a separate corporate entity, and as such, had nothing to do directly with the contract for carriage. 

32                  The second defendant is the corporation which manages the vessel owned by the fourth defendant and whose name attends the bill under which the vessels carried the goods.

33                  I am not aware of the precise arrangements, but I would assume that the second defendant time-charters vessels from various shipping companies, on the evidence probably one-ship companies, to run a line which it organises and commercially operates, in effect, as its line, MSC.  The second defendant has solicitors in Australia and has a presence in Australia through related corporations. 

34                  The plaintiffs have sought and have been given leave to serve ex juris.  The effectuation of that service pursuant to the rules, and pursuant to international Conventions, will be both time consuming and consuming of funds. 

35                  What I am about to say is in no way to be taken as a criticism of any of the defendants.  I simply wish it to be known that, for my part, in administering in the commercial jurisdiction under the Admiralty Act 1988 (Cth) in this kind of claim, I would expect defendants not to, where it was unnecessary, put plaintiffs to expense which can be avoided in claims where there is available to the defendants information and intelligence locally here in Australia from companies which commercially operate in Australia.

36                  That is not a principle of law.  However, if overseas companies desire to place applicants in the position of having formally to go through all relevant steps to serve ex juris under the Conventions but then ultimately rely upon local solicitors in circumstances where it can be inferred that commercial common sense and a sensible desire for expedition in the resolution of the commercial dispute would have led to a speedier and earlier resolution of questions of service, those matters, subject to hearing from the parties, would be matters which could be taken into account in ascertaining who should bear the costs of service and effectuation of service.

37                  I say no more than that.  It is not said by way of criticism of any defendant or any practitioner.  Of course, I have expressed no views whatsoever which are final (in any way).  I have not heard from any of the defendants and, as I said, I am not saying that any conduct of the defendants thusfar has been in any way legally, procedurally, or commercially inappropriate.  I will say no more at the present time. 

Associate:

Dated:              3 April 2003