P L D 1965 (W (PLP)

SARDAR MUHAMMAD IQBAL, J.‑

The appellants, Messrs Khabbaz Brothers, instituted a suit for the recovery of Rs. 44,935‑10‑0, which is equivalent to pounds 3,370‑2‑9, against the respondents Messrs Dalmia Cement Limited, Karachi, alleging that the latter were liable to pay this amount to them as demurrage on account of the delay caused by them in loading the ships which the appellants had chartered. The suit was dismissed by the Single Judge in Chambers on the 20th of April 1961. The appellants have come up in Letters Patent Appeal.

2. The case of the plaintiff‑appellants is that the defendant respondents are the manufacturers of cement. The appellants entered into a contract with them on the 7th of December 1956, to purchase 14,000 long tons of cement. The price settled was Sh. 138.6d. per ton of 2.240 lbs. net f.o.b. and stowed Karachi. The period of contract was the month of December 1956, to March 1957, with fifteen days' margin on either side. Payment' was to be made by a confirmed irrevocable letter of credit which was to be made available for negotiation against presentation, inter alia, of full set of bill of lading. The bills of lading were to be delivered to the respondents immediately after each shipment free of freight. As to the shipment, it was agreed by the respondents that they would load a quantity of 800 tons per weather working day, SHEX (Sundays an holidays excepted), and pay demurrage at the rate of pounds 200 per day and claim Despatch, if any, at half the demurrage rate. It was agreed that the second party would give to the first party a clear ten days of notice of readiness of the steamer to load at Karachi. The plaintiffs‑appellants chartered steamer ships "San Padro" and "Maria Vittoria" for lifting the cement which they had agreed to purchase from the defendants. S. S. San Padro had two voyages, whereas S. S. Maria Vittoria had only one. S. S. San Padro for the first time reached Karachi on the 10th of January 1957. The respondents had already been informed of its date of arrival by a letter dated the 31st of December 1956, (Exh. P. 7/58). The respondents, however, commenced loading on the 15th of January 1957, and completed it on the 19th of January 1957. The total quantity of cement loaded in the ship was 3,450 tons. The respondents took 7 days, twelve hours and thirty minutes in loading the consignment. They in fact, should have taken four days, seven hours and thirty minutes, commencing from the 10th of January 1957. The appellants, therefore, claimed demurrage in the amount of Pounds 641/13/6 for a period of three days and five hours. The next steamer ship Maria Vittoria arrived at the port of Karachi on the 17th of January 1957. The respondents started loading the ship on the 25th of January 1157 and completed the loading of 2,351 tons on the 29th of January 1957. According to the appellants, by computing the period from the 17th of January 1957, the time spent in loading the ship was nine days, twelve hours and thirty minutes, whereas it should have been completed in two days, twenty‑two hours and fifteen minutes, The appellants, therefore, claimed Pounds 1,318/15 as demurrage for six days, fourteen hours and fifteen minutes.

3. S. S. San Padro arrived at Karachi for the second time on the 10th of February 1957. The respondents, however, started loading it on the 15th of February 1957 and completed it on the 22nd of February 1957. The total tonnage was 3,

194. According to the appellants, the respondents took seven days, one hour and ten minutes more than the stipulated time and they, therefore; claimed demurrage in the amount of Pounds 1,409/14/3 on account of the delay.

4. The defendants‑respondents traversed the allegations made by the plaintiffs‑appellants and denied their liability to pay any demurrage to the appellants. They specifically alleged that the appellants had failed to give them a clear ten day notice of readiness of the steamers to load at Karachi. The ease put forth by them as to the arrival of different ships was that on intimation received by them that S. S. San Padro was to arrive at Karachi on the 10th of January 1957, they had despatched cement in 82 wagons to the East Wharf in order to commence loading on the steamer being brought alongside the berth. S. S. San Padro arrived at the anchorage on the 10th of January 1957, but they had no liability to load it unless it had been brought alongside the berth and that the loading at the outer anchorage was not permitted by law. The ship was berthed at 22 15 hours on the 15th of January 1957, and the respondents commenced loading immediately at that time and completed the same in four days and fifteen minutes on the 19th of January 1957, and thereby saved seven hours and fifteen minutes. In terms of the agreement between the parties they claimed Pounds 30/4/2 as despatch money at the rate of 100 pounds per day. As far as S. S. Maria Vittoria is concerned, the respondents alleged that it was berthed on the 25th of January 1957 at 1700 hours, and notwithstanding the fact that they had not been given a notice of readiness they commenced the loading at 19.00 hours on the same day and completed it on the 29th of January 1957 at 15‑30 hours. The respondents claimed to have completed the loading seven hours and forty‑five minutes earlier than the stipulated time and, therefore, claimed Pounds 32/5/10 as despatch money. About the second voyage of S. S. San Padro the respondents alleged that it was berthed at No. 4 East Wharf on the 14th of February 1957 at 22.00 hours. Although no notice of ten days was given, the respondents commenced loading on the 15th of February 1957, at 15.00 hours and completed the loading of 3,194 Tons on the 22nd of February 1957 at 15.00 hours. According to them, they saved thirteen hours and fifteen minutes in the loading of the ship, and therefore, made a claim of Pounds 57/12/9 as despatch money.

5. On the pleadings of the parties, the issues were framed. The material questions to be decided were whether the appellants had given the ten‑day notice of readiness to the respondents and that the "lay days" for the purposes of determining the demurrage were to commence from the time the ships arrived at the outer anchorage of Karachi Port or from the time the ships were actually berthed within the harbour. The claim of the respondents that they were entitled to certain amount on account of the "despatch" was not pressed by them, because they had not raised it by way of a set‑off or a counter‑claim. The learned Judge in Chambers, in his well‑considered judgment, has, however, held that the question of notice in the case was immaterial and that the lay days in the case of the parties commenced from the date the ships were berthed and not when they arrived at the outer anchorage.

6. Learned counsel for the parties have argued the case at length. Mr. Noor Muhammad on behalf of the appellants made a statement at the bar that the ten‑day notice of readiness was not given in the case of the second voyage of S. S. San Padro. He, therefore, made no claim to demurrage in respect thereof. As to whether the requisite notice of ten days was given in other cases we will be dealing with it presently.

7. The scope of the present dispute has been narrowed down to a considerable extent. The only serious question which needs determination in the case is as to when the lay days could commence in respect of each ship for the purposes of determining the liability to pay demurrage. If the lay days are to commence from the date the ship was actually berthed, Mr. Noor Muhammad , learned counsel for the appellants, conceded that the appellants would have no case to put forth. In support of his contention that the respondents were liable to load the ships from the time they arrived at the outer anchorage, he relied on the terms of the charter‑party. The appellants, as stated earlier, had chartered S. S. San Padro and S. S. Maria Vittoria. They had entered into charter‑party with the ship‑owners. The respondents were not party to the charter‑party. An attempt, however, was made to argue that by the fact that the respondents had agreed to pay the demurrage, they had impliedly agreed to abide by the terms of the charter‑party in this behalf. The relevant clause of the Charter‑party of the S. S. San Padro dated the 12th of December 1956 (Exh. P. 6) is "that the said vessel shall proceed to Karachi (Pakistan) or so near thereto as she may safely get and lie always afloat, and there load a full and complete cargo 3,400 metric Tons . . . " Again, in paragraph 6 of the charter‑party it is stated, "Time lost in waiting for berth to count as loading time." The terms of the charter‑party of S. S. Maria Vittoria dated the 15th of January 1957 (Exh. P. 13) are, "That the said vessel shall proceed to Karachi or so near thereto as she may safely get and lie always afloat and there load" and that "time lost in waiting for berth to count as loading time." According to these terms, there can be no manner of doubt that as between the appellants and the ship‑owners, the lay days were to commence from the time the ships arrived at Karachi, and the fact that they were not able to obtain berth will not affect this position. It is an express term of the charter‑party that the time spent in waiting for berth was to count as loading time. Even if this term had not been there, the appellants could not escape their liability towards the ship‑owners. What was agreed upon was that the vessel would "proceed to Karachi or so near thereto as she may safely get and lie afloat." Under the circumstances, as soon as it arrived at Karachi, the lay days commenced against the charterer and the vessels became the arrived ships. Having reached the outer anchorage, the ships would be legally considered to have arrived at the port of loading. It was held in Leonis S. S. Co. v. Rank ((1908)K B 499) that the rule was that where the charter‑party named a port simply, without further pecularity or qualification, the ship was an arrived ship when she came within the commercial area of the port. In this case a ship was chartered to load at Bahia Blanca. When she arrived, the port was crowded with vessels, and she could not get to a berth, so she anchored in the river within the port. There she remained for about five weeks before a berth was available. It was held that she was an arrived ship when she anchored in the river. It has thus been elucidated that when the place named is a port or other wide district the lay days begin when the ship is ready and at the freighter's disposal within the named placed though she may not be in a position to take in a cargo, and although she may not be at the Wharf, dock or other part of the place to which the charter may have properly required her to go. If these terms of the charter‑party are applicable to determine the demurrage between the appellants and the respondents, we can have no doubt that the lay days would commence from the respective dates of the ship's arrival at the outer anchorage and the total period in loading had to be computed from that date.

8. A question arises whether these terms are applicable against the respondents. They could be applied only on an express or implied contract or if it could be shown that there was a custom or usage applicable to the parties to that effect. No reliance was placed on any custom or usage. There is no express contract in this behalf. In fact, the contract of sale and purchase between the parties was arrived at on the 7th of December 1956, whereas the charter party in the case of S. S. San Padro was executed on the 15th of December 1956 and in the case of S. S. Maria Vittoria on the 15th of January 1957. There was, moreover, no indication given in the contract that the respondent would be governed by any such terms which might be subsequently incorporated in the charter‑party between the appellants and the ship‑owners. The learned Single Judge, dealing with this aspect of the case, observed, "There is nothing in the contract, and I cannot find any principle upon which the terms with regard to the counting of lay days which is contained in the charter‑party agreement between the plaintiffs and the ship‑owners should be imported into the contract by which the parties to this suit are governed," Learned counsel for the appellants, however, referred to clause (d) of the contract wherein it is stated that the charter party bill of lading was to be acceptable to the appellants and also to the terms of the contract wherein it is stated that the respondents would be liable to pay demurrage at the rate of 200 pounds and would be entitled to despatch at half the demurrage rate; and argued that the fact that the charter‑party bill of lading was acceptable and the respondents were also liable to pay the demurrage, would show that the demurrage was to be understood in terms of the charter‑party. According to him, it was for the respondents to have paid the demurrage and the appellants were liable only to pay the freight. We must confess that from these clauses we have not been able to infer that the respondents had, in any way, agreed to be bound by the clause of demurrage or other terms of the charter‑party. We are clear in our mind that if it is desired to make anyone other than persons who are parties to the charter‑party liable for demurrage a agreed on in the charter‑party, there must be a clear stipulation to that effect binding such a person. In the case of a consignee it can be done in the bill of lading by a stipulation in the form "freight and all other conditions as per charter." If the appellants had intended to bind the respondents by all or any of the conditions of the charter‑party, they could have incorporated the same in the contract .by ‑saying that they would be so bound. The clause in the charter‑patty that the days spent in waiting will be lay days is doubtless a special term as held in Roland Linie Schifahrt v. Spillers Ltd. (3 WLR 620), and the appellants in order to make C the respondents bound by any such term should have taken particular care to have it incorporated in the contract. The fact is that until then the appellant had not entered into any charter party. There could, therefore, be no intention of the parties to be bound by something which had not come into being till then. The condition that the days spent in waiting should be lay days, is, however, such that the appellants could be conscious of such a term even independent of the charter‑party and could have got it incorporated, if so intended, in the contract dated the 7th of December 1956. The fact that it was not so included, shows that the parties had not agreed to any such thing. There is thus no express provision binding the respondents by the terms of the charter‑party as to the time of arrival of the ships.

9. The next question which arises is whether any such term can be inferred in the circumstances of the present case. On behalf of the appellants it was argued that the terms "despatch" and "demurrage" are conspicuous of charter‑party and since the contract provided for both it clearly implied that the parties had agreed to the terms of the charter‑party. The argument patently is fallacious. There can be no bar to the persons agreeing to such conditions even in independent contracts. The facts and circumstances of this case, however, point out that the conditions as to "demurrage" and "despatch" in the contract had no relationship with similar clauses in the charter‑party. If the respondents had, in fact, been bound by these terms in the charter party, then there would have been no difference in respect of other particulars pertaining to these items contained in the charter‑party and the contract dated the 7th of December 1956. Under the contract, the respondents were liable to load 800 metric tons per day, whereas in the first charter about S. S. San Padro (Exh. P. 6) it was agreed between the appellants and the ship‑owners that the cargo was to be loaded at the average of 700 metric tons. In the second charter (Exh. P. 13) about S. S. Maria Vittoria it was agreed that the average rate of loading was to be 600 metric tons per day. Again, the amount of demurrage to be paid under the contract was 200 pounds a day, whereas in the charter‑party of S. S. San Padro it was 250 pounds and in that of S. S. Maria Vittoria it was 300 pounds. The terms as to the expected time of arrival (E T A) are also different in the contract and the charter party. Under the charter it is five days, whereas in the former it is ten days. It would thus be clear that the terms of the contract and those of the charter party are different. We are, therefore, of the opinion that the terms of the charter party are neither expressly nor impliedly binding on the respondents. The rights and obligations of the parties will, therefore, have to be determined with reference to the terms of the contract itself.

10. The contract between the parties (Exh. P. 5) is one of simple sale of the cement to the appellant. The other conditions incorporated therein are for the purpose of the delivery of the cement and payment of price thereof. Since the cement had to be exported to other countries by sea, the appellants wanted to make it sure that the respondents delivered the goods at a specified time after notice was given to them so that the same was loaded in the ships which they had to charter for the purpose, and they did not incur any liability for demurrage to the ship‑owners for the delay caused in loading when the ships were otherwise ready to take the cargo. The respondents had, under the contracts, no responsibility to charter the ships. It was for the appellants to do so. There can be no denying the fact that the nature and incidents of both the contracts are different. In the case of a charter‑party, even if there is no specific term as to the arrival of the ship or the lay days, it can be determined with reference to the well‑established principles of the law on the subject, but in the case of an ordinary contract of sale a seller may be put to a special condition to pay the demurrage. But unless the terms are clearly specified, the principles which are applicable to the charter‑party cannot be pressed into service in that case. That being the case, the terms of the contract (Exh. P. 5) dated the 7th of December 1956, have to be interpreted uninfluenced by other considerations relateable to the charter‑party. All that the respondents had undertaken under the contract was to load 800 tons of cement per weather working day. The respondents had, in no way, guaranteed that they would find a place of loading for the ships. The respondents had only to be ready to load the ships. It was not disputed that the respondents were m a position to load the ships when they were berthed. A reference to the facts mentioned above would show that the respondents proceeded with their loading operations in each case immediately after the ship was berthed. It cannot be said that the respondents were to load the ships at any place other than the berths. This, moreover, could not be inferred in the circumstances of the case. It is a matter of common knowledge that Karachi is one of the very good ports. To expect that a person would venture to undertake loading operations at the open anchorage and not at the berth, is something which is past‑belief. If any such condition is imposed on a seller, we have no doubt that he would strongly react to it. The same being contrary to ordinary human conduct, cannot be deemed to be applicable in the present case. The appellants, however, were in no doubt as to the fact that the respondents were liable to load the ship only when it was berthed. The Karachi Steam Navigation Company Limited, who were the agents of the appellants, by their letter (Exh. P. 8) dated the 3rd of January 1957, wrote to the respondents intimating them that S. S. San Padro would be arriving on the 10th of January 1957 at Karachi and that the respondents should "bring the required cargo alongside the vessel so as to commence loading immediately on her berthing at East Wharf. The berth number will be intimated to you later". Does there remain any doubt after this letter that the responsibility of the respondents to load the ships was only at the berth and at no other place ? The appellants produced Mr. F. A. Latif, Manager of the Karachi Steam Navigation Company Limited, as their witness. He stated that it depended upon the contract between the parties as to when lay time commenced. He was shown the contract (Exh. P. 5) between the parties, and he said, "I cannot point out any term from this contract from which it can be said that it was contemplated that the goods were to be loaded in the present case at the outer anchorage." In cross‑examination he stated that in his experience no ship had ever been loaded at the outer anchorage. To another question put by the Court he replied that he had not seen any contract between the seller and the purchaser where under the former had to pay demurrage although the ship had stayed away from the berth. He categorically stated that it could be done only by a special term in such a contract. We are, therefore, in no doubt that according to the contract between the parties the respondents were liable to load the ships only when it had been berthed, and that it was neither agreed nor was it present in the mind of the parties that the ship could be loaded at the outer anchorage. This was otherwise not possible for the reason that a ship, under Rule 12 of the Karachi Port Trust Manual, has to bee loaded and unloaded only at the berth.

11. In view of our finding that the respondents were not liable to pay any demurrage it has become unnecessary for us to decide the question whether the appellants had given the requisite notices of the readiness of the ship to load. We, however, find that the notices had in fact been given. As far as the first voyage of S. S. San Padro is concerned, the respondents were informed of its arrival by a cable (Exh. P. 7) dated the 31st of December 1956. They were again given intimation (Exh. P. 8) about it by the Karachi Steam Navigation Company on the 3rd of January 1957. The respondents admitted the receipt of these notices in their letter (Exh. P. 9) dated the 7th of January 1957. So far as S. S. Maria Vittoria is concerned, the respondents admitted in their letter dated the 7th of January 1957 that they had been informed that the second ship was to arrive on the 10th/12th of January 1957. They, however, stated that they could not load two ships simultaneously or with a margin of two days and that they could undertake the second shipment on the 23rd/25th of January 1957. The ship, however, arrived at Karachi on the 17th of January 1957. Under the circumstances, it cannot be said that they did not have the requisite notice. The contention raised in this behalf is without any force.

12. We are in respectful agreement with the judgment of our learned brother. We find no force in this appeal which is dismissed with costs. K.B.A. Appeal dismissed.