Arielle Shipping Ltd v Owners of the "Lady Emma" [1993] FJHC 11; HBG0003j.1991s (11 February 1993)

IN THE HIGH COURT OF FIJI
At Suva
Civil Jurisdiction

ADMIRALTY ACTION NO. 3 OF 1991

Between:

ARIELLE SHIPPING LTD.
the owner of the vessel the "Arielle"
Plaintiff

- and -

The owners of the vessel the
"Lady Emma"
Defendant

Mr. F.G. Keil for the Plaintiff
Mr. G.P. Lala for the Defendant

JUDGMENT

In late 1990 the Fiji Group of islands was struck by a cyclone. A casualty of the cyclone was the defendant vessel the "Lady Emma" which broke free from its moorings off Plantation Island Resort and was blown ashore and eventually grounded high and dry in Momi Bay, Nadi about 200 metres from the edge of the reef on the landward side. In the words of the plaintiff's representative the position and size of the vessel "would require enormous pulling power to drag her over the reef".

The "Lady Emma" is a sizable vessel constructed of steel and measuring approximately 98 feet in length with a nett weight of 140 tons and a displacement of 200 tons.

In an effort to refloat his vessel the defendant first hired Marine Pacific a salvage operation but after 2 unsuccessful attempts on different days to tow the "Lady Emma" into deeper waters using a rope and a small tug boat, the operation was discontinued.

That unsuccessful first operation is now the subject matter of a civil claim by Marine Pacific for an amount of $5,800 against the defendant vessel presumably for work done and in which there is a counter-claim for the same amount as has been claimed in this present action.

Next the owner of the "Lady Emma" approached the captain of the vessel "Arielle", which was berthed at the Lautoka Wharf at the time taking on supplies for the nearby island resorts, and asked if he would agree to use his vessel to pull the "Lady Emma" free from where she was stranded.

The "Arielle" is a 165 foot long ex-oil rig supply vessel which had also been used to tow oil rigs. It was not however specifically designed for salvage operations and had never been used in one. Not surprisingly it also lacked the necessary gear and experienced personnel to undertake such an operation.

Captain Maesepp of the "Arielle" however had had some previous experience in salvage work and he considered that the "Lady Emma" could be towed off the reef using the pulling power of the "Arielle" and two 4 ton anchors and a '5 purchase system' of wire ropes and shackles.

He advised the defendant however that he would have to provide all the salvage equipment and divers and quoted a daily fee of $3,200 which was later reduced to $3,000 on the understanding that the fee was payable whether or not the operation to refloat the "Lady Emma" was successful.

The defendant on the other hand whilst accepting responsibility for the salvage gear (which he claims was supplied as requested) recalls however that Captain Maesepp had said "yes" when he was first asked if he could salvage the "Lady Emma" from the main Momi passage reef. There was never any mention of 2 anchors nor in particular, a 4 ton anchor, which in any event could not be obtained in Fiji.

He did not doubt the adequacy of the equipment requested and was of the opinion that with the correct use of the equipment supplied the operation should have been successful.

He would have happily paid the plaintiff vessel's fees if the "Lady Emma" was refloated. The operation however was he claimed not carried out in a workmanlike manner and he believed that the plaintiff vessel was only entitled to $3,000 being the initial deposit he paid to Captain Maesepp before the operation got under way.

A great deal of evidence was led from Captain Maesepp as to the time spent on the operation, the various equipment and different methods used to try and refloat the defendant vessel and the reason(s) why they all failed. In the final analysis however all turns on the agreement which the parties came to before the operations began.

In this latter regard Captain Maesepp stated that the service he had agreed to provide was: "a vessel and crew to try to tow the 'Lady Emma' off the reef using the equipment supplied by the defendant. It was a simple towing job". He was adamant that he was not conducting a salvage operation (for which he was ill-equipped and inexperienced) nor had he guaranteed to free the defendant vessel. Payment was to be made for each day of operation whether the vessel was refloated or not.

Captain Gulson the owner of the defendant vessel on the other hand describes their oral agreement in the following terms:

"At the end of December 1990 I visited the plaintiff at Lautoka Wharf ... and asked him if he could salvage my boat from the main Momi Passage reef. He said 'yes' and I asked if he would like to see the boat and he said: 'no I've already been' he said however: 'I don't have a few necessary things for the job, if you get these then I can do it'. I said: 'please give me the list'. He gave me a piece of paper with list - 1 anchor (not 2) 2 wire blocks (pulleys) and 1 coil of hawser 1 1/4 inch diameter to fit the blocks). I purchased the items from the shipyard and rented 2 blocks and had them delivered near the plaintiff's ship. He said: 'you'll have to pay for the crane', I said: 'okay'."

Clearly there was some misunderstanding between the parties as to precise nature of the service required and provided. On the one hand Capt. Maesepp asserts that he merely offered to provide a 'towage service' whereas Mr. Gulson required a 'salvage operation' because in his words: "Towing is when a ship is afloat. This was a salvage job whatever way you look at it."

In The "Texaco Southampton" (1983) 1 Lloyds Rep. 94 a decision of the Court of Appeal (N.S.W.) it was held inter alia:

"(1) that services rendered by a towing vessel to a distressed ship pursuant to a towage contract were not voluntary; they were not salvage services but towage services only, unless supervening events places the service outside the scope of the contract;

(4) where there existed a contract to tow making no provision for salvage and the role of the tug and crew was limited to the performance of the contract neither the crew nor the tug rendered voluntary services; "

In his judgment in the case Mr. Justice Glass tabulated the following convenient propositions which differentiate "towage" from "salvage" operations when he said at pp. 96 and 97:

"(1) Towage Services sometimes take the form of employing one vessel to expedite the voyage of another when nothing more is required than the acceleration of her progress (Mr. Gulson's view)

(2) Towage services may also be provided to a vessel in danger in the amplified sense accorded to that predicate in the Admiralty jurisdiction. Such services, however, do not qualify for description as salvage services unless additionally it appears they were rendered by volunteers; (Capt. Maesepp's view)

(4) Salvage services rendered by a volunteer give no title to a salvage reward unless the ship freight or cargo is saved; and

(5) Salvage services (which are voluntary and speculative) and towage services (which are contractual and rewarded in any event) cannot coexist during the same space of time between the same parties."

In this case I am firmly of the view that on the evidence this was a contractual towage service for which payment was agreed and due in any event.

Shorn of its maritime terminology in my view this was a straightforward case of an oral contract for work and labour entered into by the parties for a fixed daily fee. Further the contractual duty of the plaintiff was not the unusual one of a salvage contractor undertaking a continual obligation until the ship is lost or salvaged but the rather more straightforward contractual warranty that he will use reasonable skill and care in the provision of the services.

I have no hesitation in preferring the testimony of Captain Maesepp whose evidence was not only more detailed but also exhibited a greater degree of credence. He struck me as being more knowledgeable about the terms and conditions of their agreement as well as the technical requirements of the operation and he frankly admitted the limitations of his own vessel.

I also accept his evidence that at no time had he assured Mr. Gulson that he would definitely be successful in refloating the "Lady Emma".

Indeed in answer to the Court's questions Mr. Gulson himself appeared to accept that, when he said:

"There was no guarantee given but Mr. Maesepp was confident he could achieve the objective."

Needless to say Mr. Gulson was aware that there had already been an unsuccessful attempt to refloat the "Lady Emma" for which he had refused to pay and one would have expected him to have made his requirements very clear on this second attempt to refloat his vessel and, in particular, that payment would be on the basis of the well-recognised principle in salvage cases that reward would only be given for results achieved and not for attempts however laudable i.e. "no cure - no pay".

The fact that on this second occasion he was required to provide a 'deposit' and the equipment for the operation lends greater credence in my view to the plaintiff's version that he was merely providing "a towing service" for which remuneration had already been agreed before hand.

Mr. Gulson sought no guarantees and was unduly vague on the number and nature of the equipment he was required to supply. Doubtless his primary objective was the refloating of the "Lady Emma" but his previous experience would have left him in no doubt that the nature of the operation was such that there could be no certainty as to its success. He was also aware that it would cost a "ridiculous amount" to salvage the "Lady Emma".

Indeed the "Lady Emma" was eventually refloated by digging a channel from the ship to deep water using heavy earth-moving equipment and then towing the vessel into the channel using bulldozers. The total cost of the operation was $37,665 being the amount counterclaimed by the defendant.

It might well be that Mr. Gulson was struck by the seeming confidence of Capt. Maesepp coupled perhaps with some wishful thinking on his part but that does not alter their contractual obligations nor ought this Court to imply a term that payment was conditional upon the success of the operation.

The fact remains and the defendant agreed that the "Arielle" and its crew were engaged for the best part of 3 days unsuccessfully trying to refloat the "Lady Emma" and fairly early in the operation (during the operation of the plaintiff vessel's winch on the second day) Mr. Gulson began to have doubts about the operation yet he allowed it to continue.

I turn next to the counterclaim in which the defendant set out particulars of the plaintiff's alleged negligence as follows:

(1) a failure to free the Lady Emma despite the exceptionally high tide.

(2) employed incompetent servants to carry out the task; and

(3) employed inferior equipment in a negligent and incompetent manner.

Mr. Gulson in his evidence was extremely imprecise as to the nature of the negligent acts of the plaintiff vessel's captain and crew and his evidence on this aspect struck me as being largely a matter of negative conjecture. I am certainly not prepared to accept without more that the mere failure to refloat the defendant vessel inexorably leads to the conclusion that there was want of skill on part of the captain and crew of the "Arielle".

In my opinion the defendant has failed to establish its defence or counterclaim which is accordingly dismissed.

There will be judgment entered for the plaintiff in the sum of $6,000 with costs to be taxed if not agreed. For the sake of completeness I also order that the $6,000 paid into Court on account of the defendant be paid out to the plaintiff company within 21 days of the date hereof.

(D.V. Fatiaki)
JUDGE

At Suva,
11th February, 1993.

HBG0003J.91S