P L D 1962 Supreme Court 90 (PLP)

S. A. RAHMAN, J.

These are two certificated appeals arising out of a suit brought by the respondents for compensation for short delivery of goods transported from Karachi to Chittagong by the appellants in their vessel, "SS. Euthalia". It would be convenient to refer to the respondents and the appellants hereinafter as the plaintiffs and the defendants, respectively. The consignment in question consisted of 475 drums of coconut oil, 304 drums of cotton-seed oil and 2,800 bags of rape-seed. It was alleged in the plaint that 10 drums of coconut oil, 17 drums of cotton-seed oil and 91 bags of rape seed were delivered short by the defendants who had themselves landed the goods from their ship at their private jetty in Chittagong, with the help of a lighter. Rs. 18,455-4-0 were claimed as the price of the goods not delivered, Rs. 1,845-8-0 as loss of profit at 10% of the cost price and Rs. 49-4-0 by way of incidental costs of notices, correspondence, etc., making a total claims of Rs. 20,

350. The trial Judge found that the appellants had offered delivery of the ten drums of coconut oil and 17 drums of cotton-seed oil to the plaintiffs but the latter did not accept them on the plea that they were found to be empty or half-empty. This condition of the drums was, in the learned Judge's opinion, due to leakage therefrom as they were not in good condition when shipped and it was held that the defendants as carriers were not liable for the loss. In respect of 91 bags of rape-seed, however, the conclusion was reached that the defendants were liable to make good the loss, both as ship-owners and as bailees. The suit was, therefore, decreed in part, for a sum of Rs. 5,420, being the cost of 91 bags of rape seed, with proportionate costs. The decretal amount was to carry interest at 6 per cent per annum till realisation. Both parties filed cross-appeals in the High Court at Dacca. The appeal of the plaintiffs was allowed and their claim decreed in full. The defendants' appeal was dismissed. In view of the valuation of the subject-matter involved, however, certificates for appeal to this Court were granted by the High Court to the defendants. The goods were booked from Karachi, on the 17th November 1951, per the Bills of Lading Nos. 17 and 18, bearing the same date. The ship arrived at the Port of Chittagong on the 3rd of December 1951. Due to heavy draught, the ship could not come to the harbour and the defendants, therefore, arranged to transport the goods by a lighter to their godown, with the assistance of the Port authorities. A series of letters were inter changed between the parties and by the 28th of December 1951, delivery took place of 465 drums of coconut oil, 287 drums of cotton-seed oil and 2,649 bags of rape-seed. On that date, the plaintiffs' representative complained of the short delivery at the defendants' office and formal notices were sent to them calling upon them either to deliver the goods in question or to treat the notices as notices for claim, on the 31st December 1951. This was followed by a reminder, dated the 5th February 1952. The defendants by letter, dated the 16th February 1952, asked the plaintiffs to send a representative to take delivery of the remain ing drums of oil from their godown at Messrs A. K. Khan's Jetty in Chittagong. The plaintiffs' case was that their representative duly presented himself at the Jetty but the drums he was offered, did not bear their special marks and were empty or half-empty. They, therefore, declined to take their delivery. The defendants, on the contrary, pleaded that the respondents had deliberately avoided to take delivery as the prices of the goods in question had mean. while fallen. Their contention was that the contents of the drums in question were intact together with the marks of the plaintiffs. It is, however, significant that at no stage did the defendants controvert the allegation of the plaintiffs made in their letter that during their representative's visit to Messrs A. K. Khan's Jetty, the drums that were shown to him did not corres pond to the description of their goods and were empty or half empty. They merely insisted in further letters to the plaintiffs that the goods were lying there for them to take delivery of. On the 25th March 1952, a further instalment of 60 bags of rape-seed was made over to the plaintiffs. The High Court observed in the course of their judgment that, according to the pleas raised by the defendants in their written statement, the drums were not empty or half-empty and that their seals as well as their contents were intact. The evidence led by them in the shape of the testimony of one witness was also to the same effect. They, therefore, dissented from the view of the trial Judge who had held that possibly some sort of leakage in the drums was responsible for their empty or half empty conditions. In this context, the learned trial Judge had placed reliance on an endorsement in the Bills of Lading Indicat ing that the drums had dim marks and were broken and repaired. There was a similar remark about the bags of rape seed that they were torn. At the same time, somewhat inconsistently, the Bills of Lading recited that the goods were shipped in apparently good order and condition. In the circum stances, the trial Court's view was criticised on the ground that the case made out for the defendants was inconsistent with their own pleadings and evidence. Mr. Guba, on behalf of the defendants, has suggested that the High Court had misconstrued the written statement of his clients in this behalf. We find, however, that there is no substance In this objection. The defendants had taken up the definite position in Para. 8 of their written statement that the plaintiffs' representative had falsely alleged that i,e had visited the godown of the defendants and bad found the drums to he empty or half-empty. They asserted that the contents and the seals of the drums were intact. It is true that In Para. 9 of the written statement it was also averred that even if there was any shortage of contents, that was due to the defec tive condition of the drums and bags, for which the defendants could not be made liable. But having taken up the definite stand that the contents and seals of the drums were intact, this alternative plea must be held to be obviously untrue and indeed was belied by the statement of their own witness who asserted that the drums existed after the landing, in their original Integrity. The High Court preferred the plaintiffs' evidence on this point and with good reason. If the defendants' story had been true, one would have expected them to give a notice to the plaintiffs controverting their allegations in specific terms and calling upon them to accept delivery on pain of the goods being put to sale for recovery of the godown charges that the defen dants were incurring. They should have even offered the goods for inspection in the trial Court as soon as they were summoned to answer the claim. Their inaction In this respect is extremely significant. Further, the statement on oath of the plaintiffs' witness that the prices of the commodities in question had risen by 10% over the invoice prices thereof was not challenged in cross-examination or rebutted by any evidence on behalf of the defendants and their bare allegation that prices had fallen in the meantime was rightly discredited. This was then a case of short delivery of whole units of goods and the question of loss of contents of any packages owing to the alleged negligence of the harrier or of the consignor would not arise. One of the clauses in the Bills of Lading provided that the company would not be accountable in any case, beyond the amount of Rs. 250 for any one package and relatively for any portion thereof, unless a declaration of the value of such goods bad been made prior to shipment, and a special written shipping order or advice note granted for the same and unless the Bill of Lading had been signed for such goods and the value declared therein. It is common ground between the parties that no such declaration had been made in the instant case. The price per bag of rape-seed was below Rs. 250 but the claimed price of each oil drum exceeded this amount. The High Court found that this clause was repugnant to Rule 5 of Art. IV of the Schedule to the Carriage of Goods By Sea Act, 1925, read with Rule 8 of Art. III of that Schedule. It was held in consequence that the plaintiffs could claim damages for the undelivered oil drums in the maximum amount of 100 per package. The claim made in respect of each drum of oil fell below this maximum. This finding has been assailed before us on behalf of the appellants as erroneous. Rule 5 of Art. IV of the Schedule to the Act is in the following terms :- "Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with goods in an amount exceeding 100 per package or unit, or the equivalent of that sum in other currency, unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading." This declaration, if embodied in the bill of lading shall be prima facie evidence but shall not be binding or conclusive on the carrier. By agreement between the carrier, master or agent of the carrier and the shipper another maximun amount than that mentioned in this paragraph may be fixed, provided that such maximum shall not be less than the figure above named. Neither the carrier nor the ship shall be responsible in any event for loss or damage to or in connection with goods if the nature or value thereof has been knowingly misstated by the shipper in the bill of lading." Rule 8 of Art. III of the Schedule may also be usefully reproduced in extenso. It reads as follows :- "Any clause, covenant or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connection with goods arising from negligence, fault or failure in the duties and obligations provided in this Article or lessening such liability other wise than as provided in these Rules, shall be null and void and of no effect. A benefit of insurance or similar clause shall be deemed to be a clause relieving the carrier from liability." The argument has been advanced on behalf of the defendants that in the third paragraph of Rule 5 of Art. IV the words "mentioned in this paragraph" cannot refer to the first paragraph of that rule and in so far as no maximum is actually specified in the third paragraph, the bar raised by it cannot be held to apply to the case. The first paragraph, it is contended, only fixes a maximum amount claimable per package and does not limit the discretion of the parties to fix a lower maximum in that respect. Paragraph 3 of Rule 5 of Art. IV does not appear to be happily worded, but the meaning appears to us to be plain.' The words "this paragraph", occurring therein must be understood as referring to the first paragraph of the Rule. The matter is placed beyond all doubt by the last words of the third paragraph, namely, "provided that such maximum shall not be less than the' figure above named". Surely, the "figure above named" can only be found in the first paragraph. In the face of this fact, learned counsel was driven to argue that these last words in the paragraph were redundant. It is, however, a cardinal principle of construction of statutes that redundancy must not be attributed to the Legislature unnecessarily. In our view, the rule read as a whole is intelligible and lays down that the maximum limit of a claim to be fixed by agreement between the carrier and the shipper, may exceed the figure of 100 mentioned therein, but cannot be lower than this figure. Clause (8) of Art. III of the Schedule would then come into play and would invalidate Cl. 9 of the Bills of Lading which fixed the maximum at a figure below a . 100, namely, Rs. 250 per package if that clause is referable to Rule 5 of Art. IV of the Schedule to the Act. But it seems that this clause was relatable to Art. VII of the Schedule to the Act and there appears to have been some confusion in the minds of the parties and their counsel on this point. The Bills of Lading contain a definite recital that in pursuance of 0:e provision of Art. VII of the Schedule to the said Act, the carriers' liability prior to the loading on and subsequent to the discharge from the, ship, shall be governed by the "conditions and exceptions" con tained in the Bills (p. 7, Part II of Printed Record). Clause 9 thereof is included among those "exceptions and conditions". The High Court's finding that the claim made, was valid, must be sustained on the short ground that Cl. 9 of the Bills of Lading does not purport to fix a maximum limit for a claim, in variance of that envisaged by Rule 5 of Art. IV of the Schedule to the Act and no question of conflict between the two arises at all. A feeble attempt was also made to suggest that the case may be covered by Art. VI of the Act, which leaves a carrier, and a shipper free in regard to any particular goods, inter alia, "to enter into any agreement in any terms, as to the responsibility and liability of the carrier for such goods and as to the rights and immunities of the carrier in respect of such goods" notwithstand ing the provisions of the preceding Articles. It is pointed out that the second proviso to this Article which declares that it "shall not apply to ordinary commercial shipments made in the ordinary course of trade", is not enforceable in Pakistan, by virtue of the provisions of section 5 of the Act. This appears to be correct, but learned counsel for the appellants has omitted to note that there is another proviso to this Article which lays down that the Article would only be applicable if "no bill of lading has been or shall be issued and that the terms agreed shall be embodied in a receipt which shall be a non-negotiable document and shall be marked as such". These conditions are not satisfied in the present case and consequently Art. VI cannot be invoked on behalf of the appellants. Finally, reliance was placed on para. 3 of Rule 6 of Art. III of the Schedule to the Act for the contention that the claim had been made out of time. This paragraph provides that:- "In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered." The plaintiffs' suit is said to have been brought more than a year after the due date for the delivery of the goods. The High Court dealt with this point on the footing that in this case the consignment was discharged by the ship, that there was no question of any short landing, that the defendants stored the goods in their own godowns and that, therefore, the defendants were responsible for their loss as bailees rather than as carriers under Rule 6 of Art. III of the Act. The last date on which the drums of oil were delivered is the 28th of December 1951, but some of the rape-seed bags were actually handed over on the 25th March 1952. The suit was brought on the 28th of December 1952. If the date of completion of the delivery is accepted as the starting point for the limitation, the suit would be within time under the Rule quoted. The view prevailed in the High Court that after the contract of affreightment had ended, the carrier incurred a new liability as a bailee and the limitation for a suit claiming damages for non-delivery, in such a case, would be three years, under Art. 115 of the First Schedule to the Limitation Act. With respect, it seems to us that the position appears to have been misconceived by the High Court. There is no evidence on the record to show that the consignment in question had been discharged from the ship intact. It must be remembered that the defendants were themselves the carriers and they had also arranged for the discharge of the goods from the ship to their godown by means of a lighter. It was not established that the whole consignment had reached the godown of the defendants from the ship in its entirety. In the circumstances, the liability of the defendants was as carriers for the non-delivery and not merely as bail:es after the discharge of the goods from the ship. If the latter had been the case, the appellants could have pressed in aid Art. VII of the Schedule to the Act, which provides) that nothing in the rule "shall prevent a carrier or a shipper from entering into any agreement, stipulation, condition, reserva tion or exemption, as to the responsibility and liability of the carrier or the ship, for the loss or damage to or in connection with the custody and care and handling of goods prior to the loading on and subsequent to the discharge from the ship on which the goods are carried by sea". If the liability enforceable against the appellants was merely as bailees after the goods had been duly landed, then Cl. 9 of the Bills of Lading; which Is apparently designed to meet such a contingency, could not have been invalidated with reference to Rule 5 of Art. IV. read with Rule 8 of Art. III of the Schedule to the Act. These rules become applicable only if the carrier is liable for the loss as such. This distinction appears to have been lost sight of in the High Court. In the state of the evidence on the record the case was simply one of liability of the carrier as such and, there fore, Rule 6 of Art. III of the Act is attracted to the case. On the merits, the plea raised that the claim was made out of time, must be negatived. As bas been pointed out, delivery of the drums and bags of rape-seed was not completed till the 27th of March 1952 and the suit brought on the 27th December 1952 was clearly within time from that date. It has been led by this Court in Abdul Jalil Chowdhury v. The Muhammadi Steamship Company (PLD 1961 SC 340) that it is open to the shippers and carriers to extend the time for the delivery of goods by agreement, express or implied, and if there is such an extension of time the terminus a quo for the limitation shall be the new date fixed for the delivery. The relevant date would not, therefore, be in this case the 17th November 1951 on which the vessel in question arrived at the Port of Chittagong and discharged its cargo. There was an agreement inter partes, later, by which the date of delivery was postponed and from the fresh date of delivery, the cause of action arose to the plaintiffs. Their suit was, therefore, clearly within time. The appeals fail and are hereby dismissed with costs. A. H. Appeals dismissed.