The Hong Kong High Court issued a Judgment on 11/8/2009 holding a shipping company could rely on two letters of indemnity to seek compensation of US$253,655.50 from a forwarder and a trading company in a case of cargo release without production of original bills of lading. [HCA 208/2008]
This was the trial of the shipping company’s claim against the forwarder and the trading company for the sum of US$253,655.50 as its loss in relation to the release of 2 containers of goods (“the Cargoes”) in Hong Kong. The Cargoes were released to the forwarder without the production of the original bills of lading, but against 2 letters of indemnity signed by the forwarder in favour of the shipping company. The forwarder then subsequently passed the Cargoes to the trading company for further handling and disposal. On the face the letters of indemnity, each of it was signed and stamped with the forwarder’s company chop.
The shipping company’s causes of action against the forwarder and the trading company were premised on the letters of indemnity, and alternatively conversion. The forwarder’s pleaded defence was that it issued the letters of indemnity as an agent for and on behalf of the trading company, and that the shipping company and its Hong Kong agent were aware of the same. Thus, the forwarder was not liable under the letters of indemnity. The forwarder also denied that there was any conversion of the Cargoes. The trading company’s pleaded case was however that the forwarder was not its agent in signing and issuing the letters of indemnity. It also denied any conversion of the Cargoes.
The forwarder and the trading company were previously separately legally represented. Some time before the trial, their respective solicitors had ceased to act for them. The trading company attended the trial through its representative, one Ms Lung. The forwarder however did not attend the trial by any representative.
The shipping company had called Mr Yung as its witness to give evidence at trial. Mr Yung was the sales manager of the shipping company’s Hong Kong agent and was familiar with the subject matter transaction. The trading company had called Ms Lung to give evidence at trial. She was the manageress of the trading company and had handled the release of the Cargoes at the material time.
The parties
The shipping company was a shipping line established in Taiwan. The forwarder was apparently a forwarding agent in Hong Kong. The trading company was incorporated on 11/5/2007, and its “boss” was one Mr Zhang.
Prior to the trading company’s incorporation, Mr Zhang had entered into an oral agreement with Ms Siu of the forwarder to engage the forwarder to handle the cargoes imported to Hong Kong by Mr Zhang and to be delivered at his instruction. Under the above oral agreement (“the Oral Agreement”), the forwarder would provide the following services:
The forwarder would deal with and handle all relevant procedures, including customs clearance procedures, required to enable the forwarder to take delivery of those cargoes.
The forwarder would deal with and handle all documents necessary for and relevant to taking delivery of the cargoes and the related clearance matters.
Mr Zhang would reimburse the forwarder of any fees, charges and expenses incurred in discharging its services.
Mr Zhang would also further pay a handling charge of HK$200 for the forwarder’s services in respect of each delivery of imported cargoes in Hong Kong.
Before the incorporation of the trading company, in relation to the cargoes imported to Hong Kong to be dealt with by Mr Zhang’s business, he would use the forwarder’s name as the consignee under the relevant bills of lading. After the incorporation of the trading company, it would use its own name as the consignee for cargoes to be imported and dealt with by its business. However, for those cargoes that were traded by Mr Zhang before the trading company’s incorporation, the trading company would for convenience continue to use the forwarder as the consignee in those bills of lading, and would continue to engage the forwarder to take delivery of those cargoes for it.
The transactions involving the Cargoes and their release
The Cargoes were 2 containers of copper scrap bars and metal scrap shipped on board the vessel “YM Hiroshima” from Haifa, Israel to Hong Kong on 28/5/2007. The undisputed value of the Cargoes was US$253,655.50. The seller of the Cargoes was Jack Engle in the United States, and the buyer was System Solding. System Solding apparently had further sub-sold the Cargoes. Mr Zhang was the in between trader whereby the Cargoes were sold to an ultimate purchaser in the Mainland, and the Cargoes were to be shipped to the port of Sanshui in the Mainland after they had arrived in Hong Kong. As the Cargoes were traded just before the trading company’s incorporation, the forwarder was initially engaged pursuant to the Oral Agreement to take delivery of the Cargoes when they arrived in Hong Kong, and the forwarder was thus named as the consignee under the relevant 2 bills of lading (“the B/Ls”) relating to the Cargoes. The Cargoes arrived in the Hong Kong port in the end of June 2007. In around the middle of July 2007, under a mistaken belief by Mr Yung that the original B/Ls had been surrendered to the shipping company, he notified a Ms So of the forwarder (as the named consignee) of the arrival of the Cargoes, and asked her to complete the necessary documentary procedures for their collection. Ms So then contacted Ms Lung, notifying her about the arrival of the Cargoes, and asked Ms Lung to go to the shipping company’s Hong Kong agent to complete the documentary procedures to facilitate the collection of the Cargoes. Ms Lung went accordingly. She brought with her the company chops of both the forwarder and trading company.
When Ms Lung arrived at the office of the shipping company’s Hong Kong agent, she was asked to sign, amongst others, the letters of indemnity (which were standard documents prepared by the shipping company) to facilitate the release of the Cargoes. She did so, first with the company chop of the trading company, because she understood that the Cargoes were the trading company’s. However, she was then told by the shipping company’s Hong Kong agent that, as the consignee under the B/Ls was in the name of the forwarder, the Cargoes could only be released to the forwarder and the letters of indemnity had to be signed by the forwarder. Ms Lung then called Ms So and asked whether she could also sign for the forwarder with the forwarder’s company chop. Ms So confirmed that Ms Lung could do so. Ms Lung thereafter crossed out the trading company’s company chop mark and her signature on the 2 letters of indemnity, and initialled on the amendments. She then further stamped the forwarder’s company chop on the letters of indemnity and signed.
After the completion of the documentary procedures, on around 16/7/2007, the Cargoes were first collected by the forwarder’s staff at the container terminal, and later delivered to the trading company by the forwarder’s staff. The trading company took control of the Cargoes, and as the shipper, eventually arranged them to be shipped to the port in Sanshui in the Mainland in early August 2007.
Later, Jack Engle informed the shipping company that it had not received payment for the Cargoes and threatened to sue the shipping company for the Cargoes’ full value plus other fees and expenses. Mr Yung then contacted Ms Siu of the forwarder to investigate the matter and to enquire the whereabouts of the Cargoes. Ms Siu orally informed Mr Yung that the forwarder only collected the Cargoes on behalf of the trading company and had passed them to the trading company. In February 2008, the shipping company brought the legal action against the forwarder and trading company under the letters of indemnity and for conversion. On 8/7/2008, the shipping company and its Hong Kong agent entered into a settlement agreement with Jack Engle, agreeing on a without admission of liability basis to pay Jack Engle US$253,655.50 (i.e., the full value of the Cargoes) as full and final settlement of all of Jack Engle’s claim as shipper for damages, compensation and costs it might have against the shipping company and its Hong Kong agent arising out of or connected with the delivery of the Cargoes.
Whether the letters of indemnity were issued by the forwarder as an agent for and on behalf of the trading company
The 2 letters of indemnity were made on the face of them in favour of the shipping company and were identical in their terms. The relevant terms are as follows:
“We hereby request you [i.e., the shipping company] to deliver such good to [the forwarder] without presentation of the original Bill of Lading. In consideration of your complying with our above request we hereby agree as follows:
To indemnify [the shipping company] and hold [the shipping company] harmless in respect of any liability loss or damage of whatsoever nature, which [the shipping company] may sustain by reason of delivering the Cargoes to [the forwarder] in accordance with our request.
To pay [the shipping company] on demand the amount of any loss or damage which the Master and/ or Agents of the Vessel or any other of [the shipping company’s] servant or agent may incur as a result of delivering the Cargoes as aforesaid.
In the event of any proceedings being commenced against [the shipping company] or any of [the shipping company’s] servants or agents in connection with the delivery of the Cargoes as aforesaid, in provide [the shipping company] or them from time to time on demand with sufficient funds to defend the same.…”
Given the background of the Oral Agreement, the fact that it was the trading company which had imported the Cargoes to Hong Kong as the trader, the way in which the letters of indemnity were signed by Ms Lung albeit using the company chop of the forwarder, the Judge was satisfied that it was proved on the balance of probabilities that the letters of indemnity were signed by the forwarder as an agent of the trading company. This was so because it was more likely than not that the forwarder was only (and would have only agreed to) signing the letters of indemnity for and on behalf of the trading company. The Judge’s reasons were as follows.
First, the Cargoes in fact belonged to the trading company. In the premises, the Judge could not see any good reasons why the forwarder would have agreed to sign the letters of indemnity on its own, thereby assuming potentially significant liability, simply to enable the Cargoes to be released. This was particularly so as the forwarder was only to be paid a small sum (as per the Oral Agreement) for its service to take delivery of the Cargoes.
Secondly, Ms Lung in fact signed the letters of indemnity initially with the trading company’s company chop, as the Cargoes belonged to it. It was only because the consignee on the B/Ls was (for historic reasons and convenience) in the name of the forwarder that the letters of indemnity had to be amended to appear to be signed by the forwarder to enable the Cargoes to be released. Thus, the trading company intended to sign the letters of indemnity on its own in the first place.
The Judge therefore found as a matter of fact that the letters of indemnity were signed by the forwarder for and on behalf of the trading company. The Judge found that the shipping company and its Hong Kong agent were not aware of the fact that the forwarder signed the letters of indemnity as an agent for and on behalf of the trading company. In other words, insofar as the shipping company and its Hong Kong agent were concerned, the forwarder signed the letters of indemnity for an undisclosed principal.
Whether the forwarder and/or trading company were liable to the shipping company under the letters of indemnity
The law of agency in the situation of undisclosed principal is clear: both the agent and the principal are liable to the other contracting party. As commented by the learned authors of Bowstead & Reynolds on Agency (18th ed) at para 9-012:
Undisclosed principal. Where the principal is undisclosed at the time of contracting, the contract is made with the agent, and he is personally liable and entitled on it. The principal also may intervene to sue, and may be sued, but the latter only subject the general rule that nothing must prejudice the right of the third party to sue the agent if he so wishes. This therefore case where both agent and principal are liable and entitled.
As the Judge had already found that the letters of indemnity were signed without the forwarder disclosing the trading company as its principal, they were therefore both liable under the letters of indemnity. The Judge therefore found that the forwarderand trading company were jointly and severally liable to the shipping company under clauses 1 and 2 of the letters of indemnity for their loss and damage in relation to the release of the Cargoes.
Whether there was conversion of the Cargoes by the forwarder and/or trading company
Conversion is an act of deliberate dealing with a chattel in a manner inconsistent with another’s right whereby that other is deprived of the use and possession of it. The principal ways in which a conversion may take place can be set out as follows:
When property is wrongfully taken or received by someone not entitled to do so;
When it is wrongfully parted with;
When it is lost by a bailee in breach of his duty to the bailor;
When it is wrongfully sold, even without delivery, so as to pass good title to the buyer;
When it is wrongfully retained;
When it is wrongfully misused or destroyed; and
When the defendant, without physically interfering with it, wrongfully denied access to it to the claimant. See: Clerk & Lindsell on Torts (19th ed), paras17-07 – 17-08.
“Wrongfully” for these purposes means without the actual permission of the owner. When the owner intends to transfer dominion to the defendant or otherwise to sanction the defendant’s action, there is no conversion, and this remains so even though the defendant or some party is guilty of fraud. Thus, it has been said that obtaining deception is not conversion, where the victim’s proper course is an action in deceit: Clerk & Lindsell on Torts (19th ed), para 17-08.
Applying the above principles, the Judge was not satisfied it was proved that the Cargoes had been converted by either the forwarder or the trading company. The Cargoes were in fact released to the forwarder with the shipping company’s consent, albeit subject to the letters of indemnity. The shipping company thus intended to transfer the possession of the Cargoes to the forwarder for its dealing. There was therefore no question of the forwarder obtaining the Cargoes without the permission of the shipping company. In the circumstances, the Judge was also not satisfied that it was shown that the forwarder had deliberately dealt with the Cargoes with an act inconsistent with the shipping company’s right over them:
There was no evidence to show that the forwarder knew or ought to have known that the purchase price of the Cargoes had not been paid.
Further, the forwarder obtained the possession of the Cargoes with the permission of the shipping company, and the shipping company consented to the forwarder’s unrestricted dealing with the Cargoes as the consignee.
There was thus no conversion of the Cargoes by the forwarder.
The same applied to the trading company. It had obtained possession of the Cargoes from the forwarder knowing that they were released with the permission and consent of the shipping company. There was no restriction on the release that the forwarder could not part possession of the Cargoes to another party. In fact, the reverse was more likely to be correct, since the Cargoes were released to the forwarder as the consignee and it must be intended in the release that the forwarder could deal with them freely. As such, in the Judge’s view, the trading company must be seen to have obtained possession of the Cargoes also with the consent and permission of the shipping company. Further, there was similarly no suggestion that the trading company knew that the purchase price of the Cargoes had not been paid. In the circumstances, it was not proved that the trading company had obtained the Cargoes without the permission of the shipping company or that it had deliberately dealt with the Cargoes in a manner inconsistent with the shipping company’s rights. There was also no conversion of the Cargoes by the trading company.
Quantum
The undisputed value of the Cargoes was US$253,655.50. The shipping company and its Hong Kong agent settled with Jack Engle in relation to the latter’s claim in relation to the misdelivery of the Cargoes. The settlement sum was US$253,655.50. The settlement was evidenced by a written Receipt and Release/Settlement Agreement dated 8/7/2008. In the Judge’s view, it was reasonable for the shipping company and its Hong Kong agent to settle the claim by Jack Engle in the said settlement sum. This was so because the shipping company and its Hong Kong agent, in delivering the Cargoes without the production of the original B/Ls albeit subject to the letter of indemnity, did not appear to have a good defence to Jack Engle’s claim as shipper. The settlement sum therefore represented the shipping company and its Hong Kong agent’s loss and damage in releasing the Cargoes against the letters of indemnity.
The forwarder and trading company were held jointly and severally liable to indemnify the shipping company the sum of US$253,655.50 plus interest and costs.
Please feel free to contact us if you have any questions or you would like to have a copy of the Judgment.
23/F, Excel Centre, 483A Castle Peak Road, Lai Chi Kok, Kowloon, Hong Kong 香港九龍荔枝角青山道483A卓匯中心23樓 Tel: 2299 5566 Fax: 2866 7096 E-mail: gm@smicsl.com Website: www.sun-mobility.com A MEMBER OF THE HONG KONG CONFEDERATION OF INSURANCE BROKERS 香港保險顧問聯會會員
The robust freight industry in 2009 did not sustain well to the last quarter of 2010 as worldwide governments were not in unison in their fiscal policies. The worldwide government interference in 2011, such as the U.S. QEII, is likely to impact the worldwide movement of freight even more.
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The Hong Kong High Court issued a Judgment on 25/8/2017 to determine whether the Hong Kong Court or the Yangon Court was the natural and appropriate forum in an in rem legal proceedings in relation to a cargo damage claim of USD143,852.02. [HCAJ 101/2015]
The United States District Court (Southern District of New York) issued an order on 29 November 2021 to deny a shipping company’s motion to rely on the Singapore jurisdiction clause in its bill of lading. [1:19-cv-5731-GHW-RWL]
The High Court of Hong Kong issued a Decision on 23 May 2018 allowing a shipowner to be represented by 2 different firms of solicitors (one appointed by its hull underwriters and the other appointed by its P&I Club). [HCAJ84/2017] [2018HKCFI1136]
The Hong Kong High Court issued a Judgment on 11/12/2013 holding that a Hong Kong plaintiff needed to put up a security for costs in a court case concerning a yacht sinking incident. [HCCL 5/2013]
The Hong Kong Court of Appeal issued a Judgment on 20 February 2019 dismissing Changhong Group’s appeal against the High Court’s Decision of 15 November 2018 (reported in Chans advice/215) because Changhong Group had not obtained leave to appeal from the Hong Kong High Court. [CACV576/2018] [2019HKCA246]
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The Hong Kong High Court issued a Judgment on 5/8/2015 holding that a shipment of formula milk powder without the legally required export licence should not be forfeited. [HCMA171/2015]
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The Hong Kong High Court issued a Judgment on 9/2/2010 holding a carrier entitled to rely on its bill of lading clause to lien the cargoes for the damages, costs, expenses, charges resulting from the shipper’s overloading the cargoes in the containers. [HCA 1579/2008]
The Hong Kong High Court issued a decision on 11/9/2013 concerning a shipowner’s application to extend the validity of a writ of summons against a Taiwan hull and machinery insurer. [HCAJ 95/2012]
The High Court of Hong Kong issued a Judgment on 4/5/2012 explaining some legal principles as to when shipowners should fear the arrest of their ships. [HCAJ 141/2010]
The English High Court issued a Judgment on 26/2/2010 holding that a shipping company could follow the shipper’s instructions to change the consignee and the destination in its bill of lading and that the original consignee became having no title to sue. (2010 WL 606031)
In our Chans advice/169 last month, we mentioned the English Court’s Judgment dated 14/10/2014 holding CSAV’s bill of lading’s English jurisdiction clause to be an exclusive jurisdiction clause. In this issue, let’s look at that English High Court Judgment [2013 Folio No 1248, 2014 EWHC 3632 Comm, 2014 WL 5113447] issued by Justice Cooke in detail.
Remember our last issue Chans advice/129 that the forwarder was held liable for its refusing to release the goods to the named consignee without original straight Bill of Lading? On 12/8/2011, the Hong Kong Court of Appeal issued a Judgment dismissing the forwarder’s application for leave to appeal. [HCMP 683/2011]
The Hong Kong High Court issued a Decision on 13 May 2021 to deal with an interpleader action concerning the stakeholding of US$700,000 in relation to a dispute over some management fees between two transport operators. [HCMP510/2020] [2021 HKCFI 1373]
The Shanghai Maritime Court issued a Judgment on 24/12/2009 to deal with the question whether a shipping company could charge the container demurrage based on the tariff published on its website.
The Hong Kong Court of Appeal issued a Judgment on 4 October 2019 upholding the High Court’s Decision dated 9 April 2018 (reported in our Chans advice/208). [CACV593/2018][2019HKCA1101]
The Court of Appeal of Hong Kong issued a judgment on 28 March 2019 dealing with a matter concerning the sale pendente lite of an oil tanker Brightoil Glory. [CAMP49/2019][2019HKCA395]
We have received some enquiries from our forwarder clients about the FCR e.g. what is FCR? How many types of FCR are there? What are the uses of FCR? We would like to discuss these in this issue.
Remember our Chans advice/171 of 31/3/2015 reporting that the Hong Kong Court of Appeal discharged the Mareva injunctions against Hin-Pro? The Hong Kong Court of Final Appeal issued a Judgment on 14/11/2016 reversing the Court of Appeal’s Judgment of 11/3/2015. [FACA No. 1 of 2016]
The Hong Kong Court of Appeal issued a Judgment on 17/7/2014 holding a Hong Kong forwarder liable to pay US$852,339 plus costs and interest (as damages for conversion) to an Indian bank in an air cargo misdelivery case. [CACV 282/2012]
The English Court of Appeal gave a Judgment on 6/7/1987 explaining how to calculate the suit time limit for the indemnity claim under the Hague Visby Rules. ([1987] 1 W.L.R. 1213)
The Hong Kong High Court issued a Judgment on 13 August 2021 holding a forwarder liable to pay nominal damages of HKD1,000 to a shipper in a cargo misdelivery claim case of USD1,299,189.87. [HCA 937/2016] [2021 HKCFI 2310]
The Hong Kong Court of Appeal on 1 December 2021 allowed a charterer’s appeal against a High Court’s Decision dated 13 April 2021 (which disallowed the charterer’s charter hire claims of US$234,955 against the shipowner because the High Court was not satisfied the claims were well founded). [CACV 294/2021] [2021 HKCA 1865]
As reported in our Chans advice/170 dated 27/2/2015, the English High Court on 14/10/2014 held CSAV’s bill of lading’s English jurisdiction clause as an exclusive jurisdiction clause. On 23/4/2015, the English Court of Appeal issued its Judgment reaching the same conclusion. [Neutral Citation No: 2015 EWCA Civ 401, Case No: A3/2014/3584]
The Hong Kong Court of Appeal issued a Judgment on 12/2/2018 to deal with the cargo owners’ seeking leave to appeal against the High Court’s Judgment reported in our Chans advice/209 last month. [CAMP 38/2017] [2018 HKCA77]
The English High Court issued a Judgment on 15/5/2015 maintaining an anti-suit injunction to restrain the Xiamen Maritime Court’s legal proceedings in breach of a London arbitration agreement. [Case No: 2015-515], [2015 WL 2238741], [2015 EWHC 1974 COMM]
In the last issue of Chans advice, we reported the case that the Hong Kong Court of Appeal rejected the mortgagee’s appeal against the High Court’s order of granting a stay until 24 April 2019 for the sale of the Vessel Brightoil Glory. On 17 May 2019, the Court of Appeal issued another judgment refusing the shipowners’ appeal in respect of their application for a further stay of the sale of the Vessel until 22 May 2019. [CAMP81/2019] [2019 HKCA 561]
The Hong Kong District Court issued a Judgment on 26 April 2022 dealing with a case concerned with transfer of business and lifting the corporate veil, and held a forwarder and its shareholder and director jointly and severally liable for a debt of HK$975,733.71. [DCCJ 2104/2019] [2022 HKDC 289]
To continue our recent series of loss prevention articles, we would like to discuss in this issue the major provisions of the PRC Maritime Code as far as the international carriage of goods by sea is concerned.
The Hong Kong High Court issued a Decision on 25 February 2019 dealing with Changhong Group’s delayed application for leave to appeal in relation to the collision case reported in our Chans advice/218 and Chans advice/215. [HCAJ3/2018, 2019HKCFI542]
The Hong Kong High Court issued a judgment on 12/4/2016 to dismiss a cargo owner’s action in respect of breaking a barge owner’s tonnage limitation. [HCAJ 178/2014]
We reported in our Chans advice/252 that the Hong Kong High Court held Hyundai Hong Kong’s ex-Deputy General Manager (Mr Ma) liable to compensate HK$387,655,303.70 to Hyundai Hong Kong in the case of his theft of his employer’s money. On 23 December 2022, the Hong Kong High Court issued a decision ordering a sum of HK$500,000 (which was deposited by Mr Ma as bail money) to be released to Hyundai Hong Kong in partial satisfaction of Mr Ma’s judgment debt. [HCA 619/2016] [2022 HKCFI 3798]
In our last issue of Chans advice/253, the Hong Kong District Court’s judgment dated 26 April 2022 mentioned a case authority of China Ocean v Mitrans Shipping. We would like to discuss this judgment dated 11 July 1995 of the Hong Kong Court of Appeal in our Chans advice this month. [1995 No. 71 Civil]
The Hong Kong High Court issued a Judgment on 22/8/2016 dealing with a case that a forwarder wanted to strike out a cargo misdelivery claim on the ground that the claim disclosed no reasonable cause of action. [HCCL 5/2015]
The English Court of Appeal issued a Judgment on 13/12/2017 dealing with a cargo damage claim of EUR2,654,238 and a charter hire claim of USD1,012,740 in connection with a NYPE charterparty. [2017 EWCA Civ 2107] [2017 WL 06343564] [Case No. A3/2016/4770]
The Hong Kong High Court issued a Judgment on 3/2/2017 holding Natural Dairy liable to pay HK$4,360,948.38 to Schenker being the outstanding freight charges. In the Judgment, the Judge also explained the principles regarding the meaning of notice of the forwarder’s standard trading conditions. [HCA 1755/2011].
In our Chans advice/244, we reported the Hong Kong High Court case [HCA937/2016] [2021 HKCFI 2310] that the forwarder was held liable to pay nominal damages of HKD1,000 to the shipper in the cargo misdelivery claim of USD1,299,189.87. On 20 October 2021, the Hong Kong High Court issued a Decision on Costs holding the shipper liable to pay the costs of the forwarder. [2021 HKCFI 3021]
The Hong Kong High Court issued a Decision on 20/12/2017 dealing with a dispute of US$948,802.05 (as the price of bunkers supplied to a vessel) between a vessel charterer and a bunker supplier. [HCA2265/2016]
More and more junior staff of the banks insist all the Bills of Lading to be signed and issued with the above remark “As agent for the Carrier”. This is of course right if the concerned Carrier does not have its own office in the place of issuing the Bill of Lading and therefore instruct its agent there to issue the Carrier’s Bill of Lading.
The Hong Kong High Court issued a Decision on 30 September 2021 holding a shipowner’s Defences as an abuse of process in a case of unpaid crew wages. [HCAJ 76/2020] [2021 HKCFI 2961] [HCAJ 91/2020]
The Hong Kong High Court issued a Decision As To Costs on 5 December 2024 ordering a shipowner (which lost in an anti-suit injunction court case) to pay the winning party’s (a cargo owner) costs on an indemnity basis. HCCT 66/2024 [2024 HKCFI 3511]
On 12/4/2017, the Hong Kong High Court dismissed an application made by a cargo owner for stay of proceedings commenced by two forwarders in relation to an uncollected cargo case. [HCA 1927/2016]
The Hong Kong District Court issued a Decision on 30 April 2021 dealing with a personal injury case in relation to a container terminal. [DCPI 110/2020] [2021 HKDC 463]
The 12th annual SMIC seminar on uncollected cargoes pulled some 300 participants to attend with much curiosity for 3 hours in the YMCA Assembly Hall. The accumulated questionmarks and enigmas about the subject matter lurking in the trade were unleashed among the audiences.
Remember Chans advice/142 dated 31/10/2012 that the High Court of Hong Kong held the forwarder liable for cargo misdelivery without production of original bills of lading? The High Court of Hong Kong issued another Judgment on 4/12/2012 dealing with the interest and costs. [HCCL 20/2011 & HCCL 21/2011]
The Hong Kong High Court issued a judgment on 21/4/2016 and disallowed a cargo owner’s application for summary judgment against a forwarder in connection with a cargo (a diamond) missing claim of US$900,000. [HCCL 10/2015]
More than 10 years ago, we broke new grounds unheard of before among insurance brokers by introducing genuine claim support (by truly employing a team of professional transport claim handlers) independent of that from the insurers. Since then, the knowledge advantage of the insurer over that of the transport operator insured has been evened. Those who buy transport liability insurance are truly better protected with professionals standing at their side who really know the freight industry and are conversant in transport insurance and claims handling.
The Hong Kong High Court issued a Judgment on 29/4/2013 relating to a discovery order ancillary to and in support of a Mareva injunction. [HCA 2124/2011]
The Hong Kong High Court issued a Decision on 21 July 2023 in relation to a case that an aircraft (worth at least USD 80 million) and its cargoes were destroyed by a fire caused by the goods of chlorine dioxide disinfection tablets. [HCA 837/2022] [2023 HKCFI 1896]
We recently have received a lot of uncollected cargo claim cases from our forwarder clients, which have kept our 6 claim handlers very busy. We would like to take this opportunity to talk about this troublesome problem of uncollected cargoes. Actually, the forwarders have been facing this real headache in at least these two decades.
The Hong Kong High Court issued a Judgment on 3/8/2011 holding that a Korean shipping company could not rely on its Bill of Lading’s Korean jurisdiction clause to stay a Hong Kong legal action. [HCCL 13/2010]
The Hong Kong High Court issued a ruling on 2/12/2016 dealing with a shipowner’s interrogatory application in relation to an uncollected cargo case. [HCAJ 118/2015]
In Chans advice/191 and Chans advice/206, we reported a case relating to a shipping company’s claim against its former deputy general manager (Mr Ma) over the alleged theft of the company’s money. The Hong Kong High Court on 16 December 2020 sentenced Mr Ma to 15 years’ imprisonment. [HCCC 20/2018] [2021 HKCFI 195]
In Chans advice/215, we reported the High Court of Hong Kong refused Changhong Group’s application to stay the Hong Kong action. The Court of Appeal also subsequently dismissed Changhong Group’s appeal. On 13 July 2020, the Court of Final Appeal finally dismissed Changhong Group’s application for leave to appeal. [FAMV No. 34 of 2020] [2020 HKCFA 24]
The Hong Kong Court of Appeal issued a Judgment [CACV144/2017] [2018HKCA299] on 29/6/2018 upholding the High Court’s Judgment dated 2/6/2017 (which was reported in our Chans advice/201).
Following the Hong Kong Court of Appeal’s Judgment dated 11/3/2015 discharging the Mareva Injunctions and the receivership orders (mentioned in our monthly newsletter of Chans advice/171 two months ago), the Hong Kong High Court issued a Judgment on 12/5/2015 to determine the question of who should pay the remuneration to the receivers. [HCMP 1449/2014]
The Hong Kong High Court issued a Decision on 19 March 2018 dealing with some legal principles in relation to granting relief against unless orders in a ship collision case. [HCAJ 84/2017] [2018 HKCFI 609]
The Hong Kong High Court issued a Judgment on 11 January 2019 dealing with a dispute of US$335,858.31 between a bunker supplier and a ship agent. [HCA119/2015] [2019HKCFI57]
The English Court of Appeal issued a Judgment on 31/7/2009 holding a charterparty clause (concerning late redelivery) as a penalty clause and thereby unenforceable. [2009] EWCA Civ 855;[2009] All ER (D) 35 (Aug)
The 10th annual SMIC seminar on Forwarders’ Standard Trading Conditions wrapped a decade of unabated effort hammering for the freight industry’s attention to loss prevention by proper freight documents. The topic had attracted over 300 participants to attentively listening for 3 hours in the YMCA Assembly Hall. We thank them all for the patience.
This continues the Q&A in our off-line real seminar on Uncollected and Undelivered Cargo on 28 May 2024. Participants were keen to know more about seaway bills, how war plays in insurance? How modes of transport differ mis-delivery claims handling? What is insurers’ attitude towards transloading claims? And finally, why mis-delivery and uncollected cargo claims deserve special attention. SMIC deals with similar questions daily. Each case varies in its cause, and therefore healing recipe differs. But if you are conversant with fundamentals. They could be simple.
What is the difference between a straight bill of lading and an order bill of lading? This can be illustrated in the Wuhan Maritime Court’s Judgment dated 17 September 2019 concerning a cargo misdelivery claim of US$89,838.
The English High Court issued a Judgment on 31/7/2015 dismissing a cargo owner’s conversion claim US $565,891.58 against a shipowner in an uncollected cargo case. [(2015) EWHC 2288 (Comm), (2015) 2 C.L.C. 415]
The Hong Kong High Court issued a Judgment on 22/11/2013 concerning an unless order in relation to a freight forwarder’s claims for outstanding freight charges of HK$4,427,336. [HCA 1755/2011]
The Hong Kong High Court issued a Judgment on 18/11/2016 dismissing a shipping company’s application for summary judgment against its former deputy general manager (Mr Ma) for restitution of the sum of HK$387,655,303.70 on the ground of money had and received and/or unjust enrichment. [HCA 619/2016]
The Hong Kong District Court issued a Judgment on 8/2/2011 holding a Hong Kong forwarder liable for its refusing to release the cargoes to a consignee without production of the original straight Bill of Lading. [DCCJ 3467/2009]
The Hong Kong Court of Appeal issued a Judgment on 9/7/2015 in relation to the High Court Judgment dated 21/7/2014 (reported in our Chans advice/167 dated 28/11/2014). [HCMP 2315/2014]
Against the post-Covid tide, we ran an off-line real seminar on Uncollected and Undelivered Cargo on 28 May 2024. Attendance could not be compared with any webinars but the number of enthusiastic questions in the Q&A session reflected the demand for transport liability issue solutions. For the sake of recapitulations and sharing the Q&A among the Chan Advice readership, we like to report the Q&A in two issues. We welcome any other questions you may have on the following.
The Hong Kong High Court issued a Judgment on 2/6/2017 dealing with the liability apportionment among 3 vessels in 2 almost simultaneous collisions that happened near Hong Kong on 14/5/2011. [HCAJ158/2012 and HCAJ49/2013 and HCAJ48/2011]
The High Court of Hong Kong issued a Judgment on 21/7/2014, in which some legal principles relating to the in rem jurisdiction of the Court to arrest vessels were explained. [HCAJ 241/2009]
While the MOL Comfort incident was a disaster widely talked about among forwarders, all who suffered loss without exception will try whatever means to recover their losses down the line wherever the legal regimes permit.
Remember Chans advice/142 and Chans advice/145 that the High Court of Hong Kong held the forwarder liable for cargo misdelivery without production of original bills of lading? The Court of Appeal of Hong Kong issued a Judgment on 31/1/2013 dismissing the forwarder’s applications for an extension of time to appeal. [HCMP 2366/2012 & HCMP 2367/2012]
We refer to our Chans advice/251 last month reporting the Hong Kong High Court’s decision to sentence Mr Ma (Hyundai Hong Kong’s former deputy general manager) to 15 years’ imprisonment. The High Court issued another Judgment on 27 April 2022 holding Mr Ma liable to compensate HK$387,655,303.70 to Hyundai Hong Kong. [HCA 619/2016] [2022 HKCFI 1153]
The Hong Kong District Court issued a Decision on 8 May 2020 upholding a summary judgment ordering one forwarder to pay outstanding airfreight charges of HK$440,000 to another forwarder. [DCCJ1202/2018] [2020HKDC307]
The Hong Kong District Court issued a Judgment on 8/4/2014 holding that the one year’s suit time limit under the Hague Visby Rules does not apply to the carrier’s claims against the shipper. [DCCJ 4438/2013]
The Hong Kong High Court issued a judgment on 30/4/2015 dealing with the legal principles in respect of the order of priorities in distributing the sale proceeds of an arrested ship. [HCAJ 129/2013]
The High Court of Hong Kong issued a Judgment on 26/8/2011 to determine which ship to blame in a collision case that occurred at Shanghai. [HCAJ 200/2007]
The Hong Kong High Court issued a Judgment on 24/11/2015 dealing with a mandatory injunction and specific performance in respect of a letter of indemnity in connection with a delivery of cargo without production of the original bills of lading. [HCCL 12/2015]
The English Court of Appeal issued a Judgment on 20/1/2011 holding two clauses in the standard trading conditions of the British International Freight Association valid. One of them was about all sums due to the forwarder to be paid without reduction or deferment on account of any claim, counterclaim or set-off. The other was about the 9-month suit time limit. [2011] All ER (D) 128 (Jan); [2011] EWCA Civ 18
The amendment to the International Convention for the Safety of Life at Sea (SOLAS) 1974 Chapter VI, Regulation 2 in respect of the verified gross mass of a container carrying cargo (laden container) is for entry into force globally on 1 July 2016.
We have received a lot of cargo claims from our forwarder clients in the recent months. In this issue, we would like to discuss in general how the forwarders should handle the cargo claims.
Following the issue of Chans advice last month, we would like to report the latest decision issued by the court over this theft case. On 17 January 2023, the Hong Kong High Court dismissed Mr Ma’s application to withdraw HK$1.5 million out of his frozen assets for paying the legal costs for his appeal against conviction in theft. [HCA 619/2016] [2023 HKCFI 197]
In Chans advice/215, we reported that the Hong Kong High Court refused Changhong Group’s application to stay the Hong Kong proceedings; and in Chans advice/234, we reported that the Court of Final Appeal dismissed Changhong Group’s application for leave to appeal. On 7 April 2022, the Hong Kong High Court issued a Decision dealing with Changhong Group’s action to re-litigate its stay application. [HCAJ 3/2018] [2022 HKCFI 920]
The Hong Kong Court of Appeal’s Judgment dated 11/4/2008 explained some legal principles relating to whether indemnity claims are allowed by in rem legal actions against vessels. [CACV 257/2007]
The Hong Kong High Court issued a decision on 31 May 2022 ordering a South Korean shipowner to provide a Hong Kong shipowner with security for costs in the amount of HK$600,000 in relation to a ship collision case that happened in Hong Kong during the super typhoon Hato in August 2017. [HCAJ 80-85/2019] [2022 HKCFI 1631]
In this issue, we would like to continue with the case (CSAV v Hin-Pro) mentioned in our monthly newsletter of Chans advice/169 two months ago. The Hong Kong Court of Appeal issued its Judgment on 11/3/2015 discharging the Mareva Injunctions and the receivership orders granted by DHCJ Saunders against Hin-Pro and Soar. [CACV 243/2014]
The Hong Kong High Court issued a Judgment on 27/5/2011 in relation to an air shipment that a forwarder issued two sets of its House Air Waybills to two different parties for one lot of cargoes. [HCCL 117/1994]
SMIC has finally jumped on the bandwagon of the cyber media rush by its presence on the Facebook. We would have done this for a long time had it not been for the daily chores and that we were then not too convinced of its value in the commercial world. Thereafter, it becomes obvious that more and more firms are capitalizing on this new media; and unlike the old economies where information flow was imperfect, consumers of the new economies tend to prefer looking up for information by themselves from the web, or augmenting information they are given.
The Montreal Convention is an international treaty agreed by 140 states in respect of governing carriers’ liability for injury or death of passengers, damage to or loss of baggage and cargo and losses caused by delays. Hong Kong has adopted it through the Carriage by Air Ordinance (Cap 500).
The Hong Kong High Court issued a Judgment on 7/6/2011 explaining the concept of the package limitation of the United States Carriage of Goods by Sea Act. [HCAJ 181/2008]
The Hong Kong High Court issued a Decision on 4 March 2020 dismissing a shipowner’s application for a stay of proceedings in favour of arbitration in a case of cargo misdelivery without presentation of original bill of lading. [HCAJ 5/2019] [2020 HKCFI 375]
