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HIGH COURT OF FIJI ISLANDS
NATIONAL TRADING CORPORATION LTD
v
STUART HUGGET &
CARPENTERS FIJI LIMITED MBF
[HIGH COURT, 1999 (Pathik J) 19 February]
Appellate Jurisdiction
Admiralty- demise charter party- implied warranty by charterer that vessel seaworthy.
A group of anti nuclear protestors including a well-known Suva architect and a prominent Senator chartered a vessel to sail to the
Tuamotu Archipelago to protest against French nuclear testing at Mururoa. Unfortunately the vessel broke down and the party never
reached their destination instead drifting at sea for some days before finally being rescued. The owners of the vessel refused to
pay for essential repairs. On appeal the High Court HELD: that it was an implied term of the charter party that the vessel was seaworthy
which it plainly was not and that accordingly the cost of the repairs was properly the responsibility of the owner.
Cases cited:
p>
Cohn v. Davidson & Anr ( [1877] UKLawRpKQB 25; 2 QBD 455
Dixon v. Sadler (1841) 5 1) 5 M & W p>
Jessie Hedley (Pauper) v. Pinkney & Sons Steamship Co. Ltd.
;ټ < < ـ (1894) 2C 222
Kopitoff v. n & Ors Steel et.al t.al v Thev The State Line Steamship Company (1877) 3Cas.72 “Inemberember 1995, the “the M.V. Kaunitoni” (the vessel) sailed from Fiji bound for Muroroa. Her passengers consisted
of a group of anti-nuclear prote both local and international. Unfortufortunatel &the “M.V. Kaunitoni” did not reach her destination. Her engine broke down on route. The protestors
were stranded on the drifting vessel in the middle of the Pacific Ocean. Follow dramatic rescue, she was twas towed to the Cook Islands
for engine repairs. Their works were care carried out by the plaintiff at the defendant’s request. The plaintiff claims against him for the balance
of the costs of the said repamounting to $11,805.99. Mr. Hugget allt alleges that the 3rd party, (Natco), is liable to indemnify him against the plaintiff’s claim. Natco owns the “M.V. Kaunitoni”. At the time of the breakdown, theel was the subject of a chaa charter party Agreement
(the agreement) between Natco and Mr. Hugget, Adi Tabakaucoro and Ms Costello, (erers). The charterers had had hired the vessel
specifically for the protest voyage. The charter party agreement contains the terms and conditions of hire”. 1. &##160; &##160;
2. ҈ < ;ɘʔ TH> the ;the learneearned trial Magistwas -#160; (a) ;ong in hold holding thng that the damage done tone to the the vessel arose out of fair wear and tear; (b) ; inholdiat that the the the 1st Respondent was not entitled to anto any indy indemnity under $40,000.00 in terms of the
charter party; (c);ټ&#wrong in hoin holding that Appellapellant want was lias liable to indemnify the 1st Respondent when the Appellant had
nothing toith the causation giving rise to claim by the Carptrac nor was the appellant party to the cthe contract for repairs.
3. ; n
ـ &##60;&< THAT the eearnial MagistrateRe’s judgment or decision is inconsistent in that ourt that 0;engine was damaged” aner injudgmeld
that the dthe damageamage was was by reby reason of fair, wear and tear. & #160; R
The Charterers sht t air oeir own expense maintain the vessel throughout the period of hiring in aoughly efficient state
in hull, machinery and equipment (fair wear and tear only excepted) ted) in accordance with good maintenance practice and shall make
good all damage thereto other than damage resulting from fair wear and tear..... 10. harterers shall have no auno authority to bind the owners by any contract whatsoever, including contracts for the carriage
ods oformaf ser or fe repair, maintenance, provisioning or supply of thof the vese vessel, sel, .......... 11. e ownhrs sbell be underunder no liability whatsoever for any loss, damage or delay of whatsoever kind and whensoever arisinfor
ajury deatany person whomsoever, unless caused by personal want of due due diligdiligence ence on thon the part of the owners or
their manager prior to delivery in making the vessel seaworthy and fitted for the charter service. 12.   Chartererl shall inde indemnify the owners against all and any liabilities and claims of whatsoever nature and howsoever
ag in ction the l, including but not limited to any damages, fines, charges, ges, taxestaxes or o or other ther impositions salvage
or general average for which the owners may incur liability or which may be claimed against the owners or imposed upon the vessel
at any time during the period of hiring. 18. &##10;& The l shel shall bell be redelivered on the expiration of this charter in the same order and condition as when delivered
to the Charterers (fair wear and tear only excepted) at port in Sn or e expon of c of charteharter.r.” > By &#seaworthyorthy”, my Lords, I do not desire to point to any technical meaning of the term, but to express that the ship
should be in a condition to encountatever perils of the sea a ship of that kind, and laden in n in that way, may be fairly expected
to encounter in crossing the Atlantic. My Lords, if there were no authority upon the question, it appears to me that it would be
scarcely possible to arrive at any other conclusion than that this is the meaning of the contract. &#I take it myit my Lords, to be quite clear, both in Englandin Scotland, that where there is a contract to carry goods in a ship,
whether that contracttract is in the shape of a bill of lading,ny other form, there is a ds a duty on the part of the person who
furnishes or supplies that ship, or that ship’s room, “The id warrawarranty of seaworthiness into which the owner of a ship enters with the owner of her cargo, attaches at the time
when thils of the intended voyage commence, that is, when she sets sail with the cargo on board ford for her port of destination;
and this warranty is broken if she is then unfit to encounter these perils, although she may have been seaworthy whilst lying in
the port of loading, and also at the times of starting from her anchorage for and arriving at the place of loading appointed by the
charterer, and of commencing to take on board her cargo.” “The defen wets were the owners of a vessel, and chartered her for a voyage to D., from the port of Sere she was then lying
in a seaworthy condition. Pursuant tant to the terms of the charterparty, and by the orders of the plaintiff, the vessel proceeded
to a wharf situate in the port of S. and there loaded on board a cargo of cement belonging to the plaintiff. At the time when she
commenced taking in the cargo she was seaworthy; but by the time of setting sail on her voyage she had from some unknown cause become
unseaworthy. The defendants were not guilty of negligence in sending her to sea in the condition in which she then was. Soon after
starting from S. she began to leak; but the wind being fair for the voyage to D., the master resolved to keep his course for D.,
and he was not guilty of any negligence in not returning to S. The vessel did not reach D., but foundered at sea, and the plaintiff’s
cargo of cement was totally lost:- s held: > tha warranty of seaf seaworthiness implied by law upon entering into the charterparty had been broken, and that the plaintiff ntitl
recover the value of the cargo shipped by him onim on board the vessel.” “Not the ordi ordinary rule is that, at the commencement of the voyage, there is an implied warranty that the ship is seaworthy, not that the ownel usebest endeavours turs to make her so, but that she
is in facn fact seaworthy. (emphasis added) “....ve no dono doubt myself that the words of exception which are contained in the bill of ladi no degree denude the shipowner
in this case from the liabiliability so created”.
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  <160;
Appeal e High Cour Court from the Magistrates’ Court.
G.P. Lala> for ppellant
P.I. Kni. Knight for the Respt
H. Lateefateef for the Second Respo
Pat:
>
The appellantrd Parts arts app against the R ‘whole of the findings, order, judgment or decision’ herein aein against
the appellant from the judgment deld on rch 1998. The leae learned Magistrate gave judgment in favo favour of the second respondent
(the original plaintiff - R2) with costs and also ordered that the first respondent (RI) be indemnified by the appellant for the
sum claimed with costs.
round facts
&
Thes are amply set out out in the Decision or Judgment of the learned Magistrate and for easeeference, in so far as it is material
to this Appeal, they are as follows:
Grounds ofall
The followin the Groundrounds of Appeal:
u0;the learned trid trial Magistrate relied on irrelevant matters and failed to rely on the relevant mat, namhe ch partd.Issue oeal
In short tort the main main isin issue fsue for thor the Coue Courtrt’s determination is whether the learned Magistrate was
correct in ordering that the defendant be indemnified by the Third Party for cost of repairs carried out by the second respondent.
pellant’s submissbmission
Mr. Lala submitted the the appellant is not liable to indemnify the first respondent for cost of repair works carried out by the
second respondent on the vessel; that R1 did not a agent of the appellant in having the repair work carried oied out and in fact
there was no request made to the appellant to have the work done.
Mr. Lalther argued that that upon a true construction of the clauses in the Charter no authority could be implied in law for R1 to
carry out repairs and to seek indemnity from the Third Party. He says that the vessel was at R1’s risk and he was solely liable
for any breakdown and its repair costs. He says that R1 could not have acted as the agent of the appellant to authorise repairs.
He submits that the Third Party should have been contacted first.
It is further arguehim him that the vessel was seaworthy and fit to undertake the voyage and that is evident from the Survey Certificate
dated 22 t 1996 issued to the appellant by the Fiji Marine Board.
Counsel submithat the lthe learned Magistrate was wrong in finding that there was a breach of warranty. He said that the vessel was
fit for the voyage which it took. He says that the warranty did not guarann unforeseeable and unknownknown risk taking into account
that the Third Party had certain repairs done to the vessel by R2 before the Charter and before the Marine Certificate was obtained.
First respondent’s submission
It is night’s subs submission that the ship owners (the appellant) by virtue of the provisions of the Demise Charter (the &;Char8221;),
coupled with the evidence and an express ress or implied warranty of `additional seal seaworthiness’ are liable to pay the
expenses incurred by the first Respondent.
S respondent’s217;s submission
Mr. H. Lateef stthat that the issue is between the appellant and the first respondent and therefore he has no submission to make.
u>Conationhe issu issuee
Aful consideration has has been given by me to alto all the submissions made by counsel forrespective parties. I have also considered
the evidence tendered in this case.
Essentially ally the ldarned Magistrate found ̵t the engine damageamage that caused the “M.V. Kaunitoni” (“the vessel”) to breakdown was damages resulting
from fair wear and tear7;i>‘that Natco aid warranty that the the vessel was seaworthy and fit for charter’. There are other findings such as that: ‘Marine Board SurveSurvey Certificate did not certify the vessel’s (engine’s) seaworthiness. It merely pertained
to certification of safety equipment’, and ‘that approved thed the course of action taken by the defendant including approval of the repairs carried out by the plaintiff’.
I do not findhing in t in the above findings including the finding that that the Third Party “approved the course of action
taken by the dent including approval of the repairs carried out by the plaintiff”. I agree with thes these findings which are
based on evidence before the Magistrate and do not consider that they ought to be disturbed in any way. The learned Magistrate was
in a better position than the appellate Court to make the findings of fact having heard and seen the witnesses and having observed
their demeanour in the witness box.
I am of the view that there is a point of law involved in this case. There was no reference to any case law on the issues in the lower
court. Bearing in mind the facts the crucial factor which will decide as to who shbe liable to pay for the rehe repairs depends entirely
on the interpretation which one gives to the clauses in the Charter executed by the appellant and the first respondent and in particular
the clauses to which reference was made by Mr. Knight and Mr. Lala and argued on; they are clauses 5,10, 11, 12 and 18 and they read
as follows in so far as they are material:
In a nutshell, it i Lal. Lala’s argument that the clauses in the Charter particularly the ones referred to hereabove completely
absolve the appellant from all liability and that the finding by the learned trate that there was “#8220;fair wear and tear”
was wrong on the evidence before her.
In view of the authorities which I shall consider hereafter and on the facts as found, Mr. Lala’s arguments do not hold any
water.
<160;
This was8216;d216;demise chartty’ and it is headed as such being one of the three categories of charterparties in s in shipping
law. The other two being ‘vocharterparties’ and ‘time charterparties’8217;.
A ship or vessel can be hired out and a contract for the hire of a ship is called a ‘charterparty’. The ship that is hired
is said to be ‘chartered’ and the his the ‘charterer’. They are leases of ships.
In a demise charterparty the charterer takes over all the responsibilities for the vessel and I emphasise that this is subject to
the Charterparty agreement. Under clause 24 it is statet “this Charterparty contains the whole agreeagreement of the parties and no variation shall be effective unless made in writing
and signed by the parties hereto”. He employs a crew and provisions, bunkers and runs the ship as his own as long as the demise charter lasts. In this case R1 had
his own crew and captain.
Seawness - implied wied warranty
The Charterparty provides in said clause 11 that the owners shall exercise due diligence to render the vessel seaw before delivery
when it states therein that they are underunder &;no liability whatsoevesoever ..... unless caused by personal want of due diligence on the part of the owners or their manager prior
to delivery in making the vessel seaworthy and fitted for tarter service”.
The owners knew what the purpose of the hiring was. The vessel broke down en route because of its unseaworthiness at the time of delivery
and the charterers could not reach their destination and the whole purpose of h was defeated.
The responsibiliti the the parties are set out in the said clauses 5 and 11: In my view they provide an express warranty that the
vessel has to be seaworthy at the time of delivor the voyage that she has to undertake.
Thus Thus the lity of e of either party will depend on whether the appellant (the owners) made the vessel seaworthy and fitted for
the charter service than this will exempt the owners from any liability but lity will accrue to the chae charterers.
The learned Magte correcorrectly found on the evidence before her that there was a warranty of seaworthiness. The House of Lords in
Steel et The State LinesLines Steamship Company (1877) 3 As.72 held,r alia,alia, that that “there was an implied engagement to supply a seaworthy ship”. The Lord Chancellor
in hisment e meaning of the the word `seaworthy’ in this context stated thus:
In regard to ‘orthworthiness’, for the principles applicable to this appeal, I would like to refer to the following passage
from the judgment of Lord Blackburn in eel #160;
It wated in Kopu>Kopitoff v Wilson; amp; Ors [1876] UKLawRpKQB 34; (1876) 1 QBD 377 he hee) th60;‘in e;in every contract for the conveconveyance of merchandise by sea there is,e is, in the absence of express provision e contrary,
an implied warranty by the shipowner that his vessel is seaworthy’. Ii>. I would say that this statement of principle in the present appeal is the one that should be applied on the facts and circumstances
of this case despite the fact that there was no question of conveyance of merchandise in this case.
Also Parke B. in ase ofse of Dixon v. SadlerJessie Hedley (Pauper)in. Pinkney & Sonsmshipany Limited (1894) A.C. (H.L.) 2222at 22at 227) defined seaworthiness of a vessel ssel thus:
To counter themargument as to seaworthiness, Mr. Lala relied upon the said Marine Survey Certificate but he eventually agreed that
this does not prove seaworthiness. In this d the Plaintiff’s second witness (PW2) (the Naval Arcl Architect) stated that this
Certificate does not check the engine of the ship, it only ensures that safety equipment such as life jackets, pumps, safety doors
etc. are present in the vessel.
Furthermore, according to [1877] UKLawRpKQB 25; (1877) 2 QBD 455, the condition of seaworthiness is broken although the ship m in a present state of fitness at the moment of sailing if g if by reason
of a latent defect or internal weakness existing at that time she will be rendered unfit in the future for the due completion of
her voyage. In this respect I refer to the headnote to Cohn (supra) which I cor is appl applicable to the facts of this case. The headnote reads:
The facts of the cas (tre (the headnote continues):
It is therefore cleam trom the evidence that the appellant had failed in its common law duty and duty under the Charter (contract)
with the charterers to provide a seaworthy vessel to encounter the perils of the e as a result whereof the vthe vessel broke down
thus frustrating the object of the Charter namely, to reach Morurua Island.
Conclusion
To sum up, the law as I have stated above is this, that there is an implied warranty of seaworthiness in a situation such as the present.
The case law to which I have made reference support this proposition. The no provision in the Charteharter excluding or limiting
the implied warranty of seaworthiness, if anything, as I have already said the said clauses 5 and 11, on my interpretation of them
on the authorities require the vessel to have been seaworthy before delivery. InThe Cargo ex Laertes (1877) 12 P 187 at 190 Busa J said:
Even if a cas‘wea6;wear and tear’ was not made out it was still incumbent on the appellant/owners to provide a seaworthy
vessel. is context I conclude with the following words from the judgment of Lord O’Hagan in&# in
In thcome, taking the wthe whole of the evidence and interpreting the relevant clauses in the Charter as the learned Magistrate did
and considering the authorities, d that the vessel was unseaworthy at the time she sailed toed to encounter the perils of the voyage
and that the damage that was caused was as a consequence of her being unfit hence there was a breach of the implied warranty of seaworthiness.
The a therefore fails ails and is dismissed with costs to be taxed if not agreed.
(Appeal dismissed).
URL: http://www.paclii.org/fj/cases/FJLawRp/1999/20.html