1983 PLP 1068 (CLC)

(i) The Master or agent shall cable "Clearance and Shipping Division Care Tracopak Karachi" on sailing from the loading port, the quantity of cargo loaded and ETA Karachi. The Master shall also cable "Clearance and Shipping Division Care Tracopak Karachi" seven days' notice of vessels' expected time of arrival at Karachi also forty‑eight hours and twenty‑four hours notice ETA Karachi. (j) Transhipment and shipment on deck shall not be allowed. (k) The vessel shall not load any other cargo except coke. (I) No cargo shall be loaded in the deep tanks. If loaded, unloading time shall not count. Holds shall be well ventilated during the voyage to avoid risk of fire. All damages to ship due to loading into and discharging from deep tanks shall be shipowners' liabi lity. Damages,, if any, to ship during the course of loading shall be settled directly between the shipowners and the party concerned at loading port(s). (m) The Shipowners shall be free to appoint their own agents at the port of discharge. (n)' Weight of the cargo at Karachi Port shall be determined by joint draught survey by the representatives nominated by the Buyers and the Sellers." Clause 12(c) reads as follows: ‑ "12(c). If the goods are shipped by the Sellers on chartered vessel, the Buyers shall not be bound by the terms of the Charter Party if the terms of charter party are at variance with the terms and conditions of the contract entered into by the Buyers with the Sellers." Clause 18 is the force majeure clause and it is couched in the following terms :‑

18. Force Mejeure.‑Should any of the force majeure circumstances, namely Government restriction, natural calamity, fire, acts of elements war, military opera‑ions of any nature, blockage and/or strikes arise preventing the Sellers/Buyers from performing wholly or partially carrying out any of the contractual obligations, the period stipulated for the performance of the contract, shall be extend ed for as long as such circumstance may prevail Provided that in the event of such circumstances continuing for more than three months, either party may refuse to fulfill its contractual obligations without any claim to indemnification of any losses that it may thereby sustain. The party unable to carry out its contractual obligations shall immedi ately advise the other party of the commencement and the termina tion of the circumstances preventing the performance of the contract certificate issued by tae respective Chamber of Commerce of the Sellers' or the Buyers' country shall be sufficient proof of the existence and duration of such circumstances." The record shows that a Charter Party agreement was entered into between the Owners of the Vessel and the Plaintiff as the charters on 18th September, 1978 (3 days prior to the contract dated 21st September, 1978 at Tokyo, Japan and clause 26 of the rider to the Charter Party provided follows :‑

26. Laytime at discharging port to commence 24 hours after notice of readiness has been received by the receivers agents during normal office hours, whether in berth or not. If discharging berth is not available on vessel's arrival at or off the port of discharging on account of congestion and vessel is not granted free pratique, the vessel shall be entitled to give notice of readiness on arrival there by cable or other method to the receivers agents and the notice shall be received in no time accordingly, with the effect that time count as stipulated above, as if vessel were in berth and in free pratique and also in all respects ready for discharging."

3. As observed earlier, the learned Umpire found that laytime had commenced on 18th November, 1978 and not on 28th November, 1978 when the vessel had berthed. In coming to this conclusion, the learned Umpire referred to various standard books on Marine Law and also to reported decisions and I may reproduce here para. 6 of the Award dated 29th July, 1981 :‑ "

6. The rules of law are well‑settled that Laytime begins to count when certain requirements are satisfied; viz. (1) Reaching the agreed destination; (2) Readiness of the ship to load or to discharge and (3) Giving a notice of readiness after arrival. When these require ments are satisfied, the ship is said to be an "arrived ship" and, subject to the expiry of any prescribed period after the notice of readiness, laytime begins to run‑See "Laytime" by Michael Brynmor Summerskill 1966, page

105. The rules of law are also well‑settled as to when a ship is deemed to have reached its desti nation and deemed to be an "arrived ship" so that laytime may begin to count. When the agreed destination mentioned in the charter‑party or the contract, is a port named simply (as in the case of a port Charter‑party) the ship is an arrived ship when she comes within the commercial area of the port, where ships pro posing to discharge their cargoes, usually wait at the disposal of the charterers, even though the ship has not yet reached the berth, where she will actually discharge the cargo. Where however, a berth is named in the Charter party (as in a berth charter‑party) or there is an express provision therein giving the charterer an option to order the ship to a berth on arrival at the discharging port, the ship is not an "arrived ship" and laydays do rest commence, until the ship actually gets alongside the berth, as though the berth had been originally named in the Charter party or the Contract. These principles of law were laid down in the leading case of Leonts S. C. Co. Ltd. v. Bank Ltd. (1908) 1 KB 499 which have been followed in several later cases, Armement Adl of Deppe v. John Robinson & Co. Ltd. 14 Asp. M.C. P‑48, and received the approval of the House Lords in the I'Aclio's" case 1961 A C

135. The. principles was also applied by the High Court of West Pakistan in Naqi Hanna Khabbaz do Co. v. Dalmia Cement Ltd. P L D .1965 Kar. 224 at page

227. A summary of the principles will be found in Carver's Carriage by Sea Vol. lI, 12th Edition 1991. Article 1261 page 864 and Halsbury's Laws of England. Third. Edn. Vol. 35 Art. 524 ff:" According to the learned Umpire, therefore, in the instant case, as the agreed destination in the contract dated 21st September, 1978 was mention ed only as Karachi, the vessel in question became an "arrived ship" whets it entered the outer‑anchorage of Karachi on 16th November, 1978 and on the expiry of 24 hours' notice of readiness given by the plaintiff, the lay, time commenced on 18th November, 1978 and the‑defendant could not take the position that the laytime would only commence after the vessel had berthed. On the question of go‑slow‑strike on the part of the dock workers and the K. P. T. crane drivers, the learned Umpire, on the basis of evidence produced before him, found that there was go‑slow‑strike on the part of dock workers and K. P. T. crane drivers. However, he came to the con clusion that go‑slow was not covered by the word "strike" employed in clause 18 (force mateur clause) of the contract dated 21st September, 1978. Further the learned Umpire, on the basis of the evidence produced before him, reached the following conclusion :‑ "The question seems to be irresistible that go‑slow was not the only effective cause of the delay in discharging the cargo. In any case, the effect of go‑slow could have been prevented by engaging more gangs of dock‑labours. Moreover, no notice of the go‑slow was given to the plaintiff nor certificate of the Chambers of Commerce was submitted as required under clause 18 of the contract. My find ing, therefore, on this issue is, that the go‑slow did not amount to strike as contemplated in clause 18 of the contract and did not extend time for discharging the cargo. It may also be mentioned here that an issue (issue No. 4) had been framed by the learned Umpire, as to whether the defendants were bound by the terms of the Charter Party. On this issue, the finding of the learned Umpire is contained in para 13 of his Award dated 29th July, 1981, which is as follows :‑ "(13) It is not necessary to decide this issue. It is‑relevant only in so far as clause 26 of the Charter party is concerned, which provides that laytime at discharging port is to commence whether the ship is "in berth or not. As held by me under issue No. 1.‑Laytime commenced under the contract when the ship was at the outer anchorage, though not in berth and as such; clause 26 of the Charter party is not at variance with the Contract. Moreover, Buyers ‑had agreed under clause 12(c) to be bound by the Charter Party if its terms are not at variance with the contract. The con tention of Mr. Sabihuddin Ahmed relying on Naqi Hanna Khabbaz & Co's case referred to above, that T C P had no Notice of this special stipulation of clause 26 of the Charter‑Party cannot be accepted."

4. Great stress was laid by Mr. Sabihuddin Ahmad, learned counsel for the defendant that "go‑slow" by the workers is in the nature of a strike and as such covered by the word "strikes" employed by the parties in clause 18 (Force majeure clause) of the contract. There appears to be some substance in this. contention but in my view it is not necessary to decide this question in the context of the record of the present case. Even if it is assumed that "go‑slow" by the dock‑workers and the K. P. T. crane drivers amounts to "strike", the finding of the learned Umpire, on ‑the basis C of the evidence on record, is that "the effect of go‑slow could have been prevented by engaging more gangs of dock‑labourers." I see no reason or justification to interfere in this conclusion reached by the learned Umpire.

5. The only other point which arises for consideration in these pro ceedings, and on which both the learned counsel argued at length, is the point of time when the laytime commenced in this case. As observed Earlier, according to the learned Umpire, the vessel in question became an "arrived ship" when it entered the outer‑anchorage of Karachi Port on 16th November, 1978 and on the expiry of 24 hours' notice of readiness given by the plaintiff, the laytime commenced on 18th, November, 1978. The learned Umpire, in a! very concise and precise manner with references to standard works and decided cases, referred to the established rules relating to commencement of laytime. Discussion on this aspect is to be found in para 6 ‑4f the Award dated 29th July, 1981, which has been reproduced earlier in this judgment. The Principles enunciated in para 6 of the Award are principles regarding commencement of laytime while interpreting Charter‑parties. Reference may be made here to certain observations, with which I respectfully agree, in a Division Bench Judgment (Wahiduddin Ahmad and Sardar Muhammad Iqbal, JJ.), of the erstwhile High Court of West Pakistan, Karachi Bench in the case of Naqi Hanna Khabbaa v. Dalmia Cement Limited (P L D 965 Kar. 224). Its para. 7 at pages 227‑228 of the report it is observed as follows :‑ "(7) The scope of the present dispute has been narrowed down to a con siderable 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 charater‑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 San Padro dated the 12th 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 a float and them cad 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 Victoria dated the 15th of January, 1957 (Exh. P. 13) are, "That 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 laydays 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. Bank (1908) 1 K B 499) that the rule was that where the charter‑party named a port simply, without further peculiarity 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 place 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 charterer 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 lo14 ing had to be computed from that date,"

6. If the contract between the parties were a charter‑party I would have agreed with the learned Umpire that laytime commenced in the instant case on the expiry of 24 hours' notice of readiness given by the plaintiff after arrival of the vessel at the outer‑anchorage. However, the contract between the parties is a contract. of sale and purchase of goods and not charter‑party and principles of interpretation of charter parties cannot b pressed into service for interpreting a contract of sale and purchase of good unless such a provision is contained in the contract. This contract was executed between the parties on 21st September, 1978 and clause 12(c) o this contract provides that if the goods were shipped on a chartered vessel, the defendants shall not be bound by the terms of the charter‑party, if it terms were at variance with the terms of the contract between the parties. Now the record shows that a charter party was signed at Tokyo (Japan between the owners of the vessel and the plaintiffs on 18th September, 1978 i. e. three .days earlier to the contract between the parties. Although the defendants are not a party to the charter‑party but subject to the condition contained in clause 12(c) of the contract dated 21st September, 1978 the plaintiffs are impliedly bound by the terms of the Charter Party. In view of the clause 12(c) of the contract what is to be seem is whether the res pective clauses about laytime in the contract and in the Charter Party are at variance with each other Clause 26 of the Charter Party (reproduced earlier in this judgment) specifically provides that on the vessel arriving at the discharging port, it will be entitled to give notice of readiness whether in berth or not. It is further clarified that in case the discharging berth is not available and a notice of readiness is given, it will be deemed as if the vessel were in berth, Clause 11 of the contract dated 21st September, 1978 does not contain any such provision. There is accordingly variance bet ween the two clauses. If the Charter Party were signed on 18th September, 1978 containing clause 26, and if three days later in the contract dated 21st September, 1978, terms similar or identical to that obtained in clause 26 of the Charter Party are excluded it would mean that the parties did not agree to clause 26 of Charter Party to be a part of the Contract. It would consequently follow that the parties had agreed that notice of readiness could only be given when the vessel was berthed‑ and it was not a term of the contract that notice of readiness could be validly given by the plaintiffs as soon as the vessel entered the Karachi Port area although it was not berthed.

7. Mr. Mustafa Lakhani, learned counsel for the plaintiff had agreed that in case laytime commenced after the vessel was berthed, the plaintiff would not be entitled to any amount from the defendant. I am of the view that in the instant case laytime commenced after the vessel was berthed and the learned Umpire erred in law in reaching the other conclusion.

8. As a result, C.M.A. 3261/81 is accepted and the Award dated 21st September, 1978 is set aside. There will be no order as to costs. K. M. A. Petition accepted.