1998 PLP 360 (CLC)

In this suit for recovery of US $ 74320.00 equivalent to Pak Rupees 23,78,240 brought by the plaintiff shipping company against the defendants shipping organization and its agents defendant No. l has moved this application for rejection of the plaint under the provisions of Order VII, rule 11, C. P. C.

2. The grounds urged in support of the application are firstly that the defendant No. l is a company incorporated under the laws of USA and does not reside nor has any office of its own in Pakistan; secondly that defendant No.2 a Pakistani company incorporated under the Companies Ordinance as ship agent of defendant No. l in terms of sections 55 and 78 of the Customs Act, defendant No.2 has no participation and lastly that the .cause of action as stated in the plaint is not disclosed to have arisen within the territorial jurisdiction of Pakistan. In any event the cause of action as averred in the plaint does not fall within any of the clauses (a) to (r) of subsection (2) of section 3 of the Admiralty Jurisdiction of the High Courts Ordinance, 1980 (hereinafter to be referred as the Ordinance).

3. A counter‑affidavit has been filed to controvert the grounds urged in the C.M.A. with the averments that in fact both the defendants are the same company and defendant No.2 is subsidiary company of defendant No.

1. It is said that after the termination of agency agreement with M/s. Forbes and Forbes of Karachi, defendant No.l commenced its business at Karachi through defendant No.2 as its branch office for the purpose of handling various operations of its vessels or feeder vessels carrying Pakistani cargo from Karachi for trans‑shipment to various designated ports including America, European Ports of Middle Eastern countries and vice versa. It is said that defendant No.2 has been issuing the Bill of Lading to cargo owners at Karachi describing themselves as "American President Lines Limited for APL Agencies (Pvt.) Limited by authroised representative of Carrier or Master", therefore defendant No.l will be deemed to be carrying on business at Karachi though defendant No.2. Besides this defendant is exercising all powers and authorities as representative of defendant No.l at Karachi and has been dealing with all agencies including Port Authorities, Customs Department, Income Tax Department, State Bank of Pakistan and exercising control and custody over the properties belonging to defendant No. l lying in the port premises. Additionally the said defendant is storing heavy equipments used in handling containers belonging to and owned by defendant No.

1. It is urged by the plaintiff that in order to avoid arrest of the vessels defendants do not bring their vessels in Karachi waters and their containers are brought to Karachi in the feeder vessels generally time chartered. Jurisdiction of this Court is however not ousted merely because the proceedings is not commenced with the arrest of their vessel, plaintiff continued.

4. It may be pertinent to observe that both the defendants have not yet filed any parawise written statement. While defendant No. l has filed an application for extension of time till the decision of aforesaid C.M.A. defendant No.2 has not cared to appear and contest the suit. It may further be pointed out that as per averments in the plaint, defendant No. l entered into and executed a connecting carrier agreement together with a schedule of freight charges with the plaintiff at Hong Kong dated 10th December, 1986. According to the agreement defendant No. l delivered to the plaintiff a number of containers for onward transmission in accordance with the terms of through Bill of Lading and Carriage of Goods by Sea Act from East Africa to United Arab Emirates and vice versa. In terms of the agreement a portion as per tariff from the freight charges collected by defendant No. l was to be remitted to the plaintiffs or their Bankers from time to time. Accordingly plaintiff handled movements of defendants' containers carried and discharged the same at the designated sea ports in due course of their business and after discharge of the containers returned the same to the said defendant in terms of the said agreement. In consideration of the services rendered to the defendant No. l from time to time the plaintiffs maintained an open, mutual and current account of amounts of invoices for portion of freight earned by them under the agreement and the defendant No. l remitted various amounts from time to time but lastly failed and negelected to remit the balance amount due despite the service of a legal notice hence this suit for recovery and from the grant of a MAREVA Injunction restraining the defendants from removing the containers bearing defendants' marks and numbers from the jurisdiction of this Court during the pendency of suit.

5. Alongwith the plaint, an application under Rule 731 of the Sindh Chief Court Rules (Original Side) was moved for an order restraining the defendants removing the assets of defendant No. l located at M. I. yard, KPT from the jurisdiction of this Court whereupon an interim injunction order was passed by a learned Judge. Later, on application by defendant No. l it was allowed to remove the containers upon depositing Rs.25,00,000 in cash with the.Nazir of this Court which was subsequently substituted upon furnishing Bank guarantee in the above sum.

6. According to the plaintiffs' cause of action arose when the connecting carrier agreement was executed between the parties and on various dates when the defendants made payment or part payment to them on 28‑12‑1989, 30‑1‑1990 and 12‑4‑1991 and continues till date.

7. In support of the C.M.A., Mr. I.H. Zaidi, learned counsel for the defendants vehemently contended that admittedly agreement between defendant No. l and plaintiff for handling the movements of defendants' containers at the designated sea ports, was entered into at Hong Kong, that there is no averment that any of the defendants' containers were landed and discharged the goods at Karachi or that the cause of action accrued to the plaintiffs at Karachi within the jurisdiction of this Court. Learned counsel referred to the agreement Annexure "A" to the plaint which is accompanied by Exh."A", Annexure "B" to the plaint disclosing the designated ports of loading and ports of discharge and the rates of freight to be charged. A glance at this exhibit reflects the ports of Dubai, Fujirah, Mogadishu, Mombasa and Dar‑es‑Salaam as ports of loading and discharge which fall outside the jurisdiction of this Court. Submission of the learned counsel is founded upon the premise that neither the agreement between the parties was entered at Karachi nor were any of the containers landed or discharged at Karachi and obviously on the face of record services rendered by the plaintiff were at the ports far beyond the territorial waters of this country. There was, thus, no cause of action for filing this suit in this Court.

8. Having held above that the plaintiff has no cause of action to sue 'defendant No. l within the territorial jurisdiction of this Court, the question whether the said defendant carries on business in Pakistan through its general agent defendant No.2 looses its significance. I am, therefore, not inclined to enter into a factual analysis of this ground and to record a finding whether defendant No.2 is the general agent of defendant No. l and whether defendant No. l can be said to carry on its business through the agency of defendant No. 2 in Pakistan. Indeed it is absolutely unnecessary to dilate upon this aspect of the case for the reason that I have already held that the plaintiff has no cause of action against the defendant No.l in Pakistan on the averments made in the plaint and on the strength of the agreement Annexure "A" to the plaint. Needless, however, to mention the agreement between the plaintiff and the defendant No.1 has no reference to defendant No.2 and plaintiff has not placed any document on record to indicate that defendant No.2 is liable to the plaintiff for the remittance of its portion in the freight charges earned by defendant No. l for handling the movement of its container.

9. For the aforesaid reasons, plaint is liable to rejection for want of a cause of action against the defendant No. l and if that be so plaintiff has no cause of action against the defendant No. 2 independent of defendant No.

1. The plaint as against this defendant is, therefore, also rejected.

10. With the rejection of the plaint, C.M.A. No. 1964 of 1993 for extension of time to file a written statement is rendered infructuous and accordingly disposed of. A. A./G‑41/K Plaint rejected.