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ΠΑΓΚΥΠΡΙΟΣ ΔΙΚΗΓΟΡΙΚΟΣ ΣΥΛΛΟΓΟΣ
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(1975) 1 CLR 108
1975 May 17
[HADJIANASTASSIOU, J.]
ARCHANGELOS DOMAIN LIMITED,
Plaintiffs,
v.
ADRIATICA SOCIETA PER AZIONE DI NAVIGATIONE
THROUGH THEIR CYPRUS AGENTS MESSRS. A. L.
MANTOVANI & SONS LTD.,
Defendants.
(Admiralty Action No. 41/71).
Contract-Carriage and delivery of goods by sea-Against delivery of bill of lading or upon obtaining value thereof-Failure of ship-owners to obtain said bill or payment upon delivery of cargo to consignees-Breach of contract-Compensation payable-Section 73(1) of the Contract Law, Cap. 149.
Damages-Breach of contract-Remoteness of damages-Interest on damages-Whether remote.
By a contract of afreightment concluded between the parties to this Action and in consideration of a prepaid freight, the defendants undertook to carry in their ship and deliver to consignees at Marseilles, France against the delivery of the relevant Bill of Lading and/or the obtaining of the value thereof a quantity of oranges belonging to the plaintiffs the value of which was C£4,945. Defendants did carry and deliver the said goods to the consignees but they failed to obtain the value thereof or to demand and take possession of the relevant bill of lading. As a result of such failure of the defendants the plaintiffs were unable to recover the value of their said goods. Hence this action whereby plaintiffs claimed the aforesaid amount of C£4,945 as damages for breach of contract and also damages at the rate of 8½ per centum per annum on the said amount of C£4,945, as interest from the date of the delivery of the goods consigned and shipped to the date of judgment.
The defendants filed no defence to the action and upon hearing evidence from one of the Directors of the plaintiff Company the Court held:-
1. I am satisfied that the contract has been broken by the defendants, and that the plaintiffs are entitled to receive from them compensation for their loss or damage caused to them amounting to C£4,945 (see s. 73(1) of the Contract Law, Cap. 149).
2. Regarding, however, the claim for interest at 8½ per centum per annum on the amount claimed I do not think that such a loss was within the contemplation of the parties when they made the contract and such compensation is, in my view, of remote and indirect loss.
3. There will be judgment for plaintiffs for the sum of C£4,945 with legal interest from to-day.
Judgment as above.
Cases referred to:
Archangelos Domain Ltd. v. Van Nievelt etc. (1974) 1 C.L.R. 137.
Admiralty Action.
Admiralty action for the amount of C£4,945 as damages for breach of contract for carriage and delivery of goods by sea.
L. Demetriades, for the plaintiffs.
No appearance for the defendants.
Cur. adv. vult.
The facts sufficiently appear in the judgment delivered by:
HADJIANASTASSIOU, J.: In. this action, the plaintiffs Archangelos Domain Ltd., of Nicosia, a company registered in Cyprus under the Companies Law, Cap. 113, carrying on business in Cyprus and abroad, claimed against the defendants, the Adriatica Societa Per Azione Di Navigatione, through their Cyprus agents A. L. Mantovani & Sons Ltd., the amount of £4,945 as damages for breach of contract entered between them through the afore-mentioned agents on or about the end of May, 1971, relating to a shipment of goods of 4,945 cartons of Valencia oranges, on prepaid freight of £568.830 mils paid to the agents of the defendants and legal interest as from the date of judgment to the date of payment.
On October 20, 1971, counsel appearing on behalf of the defendants, who are ship-owners and the owners of the ship Brennero on which the goods were loaded, entered a conditional appearance in this action. The defendants have their principal place of business in Venice and are carrying on business in many parts of the world including Marseilles. On January 24, 1972, the defendants applied for an order that the proceedings be set aside and all further proceedings be stayed under the inherent jurisdiction of the Court on the ground that the plaintiffs and the defendants have by their agreement embodied in the bill of lading dated 21st May, 1971, for the carriage of goods, agreed to refer and submit all disputes arising under and in connection with the carriage of the said goods, to the competent courts of Venice, and, furthermore, renounce expressly the competence of any other Court. This application was based on the Cyprus Admiralty Jurisdiction Order 1893, Rules 203, 207 and 208, as well as on the inherent jurisdiction of this Court. The application was supported 20 by an affidavit sworn by a certain Sakis Markou, the person in charge of the charge and freight department of the agents of the defendants. This affidavit, so far as relevant, reads:-
"4. At the time material to this action the plaintiff shipped at Famagusta a cargo of oranges, to wit 4945 cartons of Valencia type oranges for carriage to Marseilles, France.
5. The said cargo was duly shipped, carried and discharged in accordance with the terms and conditions embodied in the relevant carriage of goods bill of lading dated the 21st May, 1971.
6. The plaintiff's claim for £4,945.-is for damages for alleged breach of contract for delivering to the consignees of the cargo the said consignment of goods without first obtaining from the said consignees the said bill of lading.
7. I am advised and I verily believe that the plaintiff's claim is directly connected with the said bill of lading whose terms and conditions are there- fore applicable to the said claim.
8. The Said bill of lading by its clause 26 states:
'Any claim for average, short delivery, deterioration, loss of goods loaded, must be presented in writing to the agents of the company at the port of destination within 8 days from the date of discharge...Failing a friendly agreement legal action must be instituted before the competent authorities of Venice.The shipper as well as the Receiver or any other interested party renounce expressly the competency of any other judicial authority. For all that is not incorporated in the present conditions of transport, are deemed to be valid the articles of the maritime laws in force in the Italian Republic'.
Specimen of the said Bill of Lading is attached marked 'A', and translation of Clause is attached marked 'B'.
9. If the Action is allowed to proceed in Cyprus it is probable that the law applicable will be the maritime laws in force in the Republic of Italy a fact which will entail, inter alia, considerable expense in proving the said law, being foreign law.
10. I am advised and I verily believe that for the abovementioned reasons this claim should not be tried here, that this is a proper case for the Court to exercise its inherent jurisdiction and set aside these proceedings and that all further proceedings in this action be stayed."
On April 29, 1972, counsel on behalf of the plaintiffs filed an opposition with regard to the application of the defendants, claiming (1) that the contract of afreightment was duly entered into between the parties in Cyprus, and thereafter the relevant bill of lading was issued again in Cyprus by the captain of the ship; (2) that the instructions and the contract of afreightment had come into existence and were duly completed prior to the date of the issue of the bill of lading, the terms of which do not constitute the complete contract between the parties to the action; (3) that the applicants (defendants) had, in breach of their duty ex contracto and in law and also in breach of their duty as bailees on reward, caused the goods, subject matter of the contract of afreightment to be delivered by them to the consignee (Societe Marseillaise de Groupage, of 3, Quai De La Joliette, Marseilles, France) without first obtaining the value of the goods in question as per the relevant invoice attached to the said bill of lading, but have instead accepted that the consignee give to them a bankers guarantee for the payment by them of the said value which they failed or neglected to enforce and receive, and which has till today remained unpaid to the loss and detriment of the respondents.
On May 31, 1972, counsel appearing on behalf of the defendants stated, quite fairly in my view, that there was no question of setting aside these proceedings, and argued only the point whether the proceedings should be stayed until the determination in another Court.
After hearing a long argument on behalf of counsel for the plaintiffs, counsel agreed to adjourn the further hearing in order to consider this point further, with a view to reaching a settlement, and on July 11, 1972, counsel appearing on behalf of the defendants sought leave from this Court to withdraw the application to stay the proceedings, because as it was stated, both counsel reached an agreement to that effect, and having dismissed the application, parties agreed to deliver both the petition and the defence to the action. I think counsel was rightly 1advised to withdraw the application for the reasons I have given in Archangelos Domain Ltd. v. Van Nievelt etc. (1974) 1 C.L.R. 137, regarding the correct principles to be applied by a Cyprus Court in deciding whether to stay an action.
Before delivering the pleadings, the plaintiffs gave notice on May 23, 1973, to the Registrar of this Court informing him that they had changed their advocate and appointed a new advocate, and on May 24, 1973, the new advocate, after discussing the case with counsel for the other side, agreed to a certain course with a view to expediting matters. On November 12, the plain- tiffs were ordered to file and deliver their petition within one month from that date and the defendants to file and deliver their defence within one, month after the delivery to them of the petition. In fact, the petition was filed on December 18, 1974, and in paragraphs 2, 3, 4, 5 and 6, they alleged that:-
"2. In May 1971 a contract' of afreightment was concluded between the Plaintiffs and the Defendants whereby the defendants undertook, in consideration of prepaid freight of 100 mils per carton, plus charges, to carry in their ship 'Brennero' from Famagusta to Marseilles 4945 cartons containing Valencia oranges belonging to the Plaintiffs, the value of which was C£4945.-, and deliver same to the consignees, Messrs. Societe Marseillaise De Groupage, of 3, Quai De La Joliette, Marseilles, France against the delivery of the relevant Bill of Lading and/or the obtaining of the value thereof, as per invoice attached to the said Bill of Lading.
3. On or about the 21st May, 1971, the said oranges were duly loaded on the said ship, the Plaintiffs duly paid to the Defendants (through the Defendants' agents) the total freight of C£.569.385 mils and the Defendants (through their agents) duly issued the relevant clean Bill of Lading dated 21st May, 1971 marked 'Freight prepaid', and 'Free out'.
4. The defendants did carry and deliver the said goods to Messrs. Societe Marseillaise de Groupage in Marseilles but failed in breach of their contract and/or duty under the law, to obtain the value of the said goods as aforesaid, or to demand and or take possession of the relevant Bill of Lading, the original of which was sent by the Plaintiffs to Marseilles through their Cyprus Bankers Messrs Banque Populaire de Chypre together with the relevant invoice for the payment of the value thereof.
5. By reason of the said breach of the defendants the Plaintiffs were unable to recover the value of their said goods and they suffered loss and damage and were put to expense.
6. Inspite of the Plaintiffs' repeated demands the Defendants failed to indemnify the Plaintiffs or in any other way satisfy their claims."
As there was no defence filed on behalf of the defendants, on March 3, 1975, counsel on behalf of the defendants was ordered to file the defence within one month and reply if any within a period of two weeks. Unfortunately, again as no defence was filed, counsel on behalf of the plaintiffs applied on April 4, 1975, to the Registrar of this Court to set down this action for hearing.
On May 16, Mr. Paris Potoudis, one of the Directors of the plaintiff company, gave evidence and said that a contract of afreightment was concluded between the parties and when the loading of the 4,945 cartons containing Valencia oranges to the value of £4,945 was loaded on the ship Brennero, a bill of lading dated May 21, 1971, was issued by the defendants (exhibit 2).
It was provided in the said contract that in consideration of a prepaid freight, the defendants agreed to deliver the oranges in question to the consignees, Messrs. Societe Marseillaise De Groupage of 3, Quai De La Joliette, Marseilles, France, against the delivery of the relevant bill of lading and/or the obtaining of the value thereof as per exhibit 2. The defendants did carry and deliver the said goods to the aforesaid consignees in Marseilles, but at the same time they failed in breach of their contract, or duty under the law to obtain the value of the said goods or to demand and/or take pos session of the relevant bill of lading, the original of which was finally sent to Marseilles through the Popular Bank of Cyprus and their correspondents, the Bank, Nationale De Paris in Marseilles. As a result of this breach or negligence of the defendants, the witness went on to add that the plaintiffs were unable to recover the value of their said goods and they suffered the loss and damage referred to in the petition, an amount which is still unpaid and outstanding.
It would be observed that during the long negotiations and in the affidavits filed on behalf of the defendants, he plaintiffs' claim for the amount of £4,945 for damages or the breach of contract was never challenged by the defendant and their main concern was, as I said earlier, to stay the proceeding this Court. Once, therefore, he defendants have failed or neglected to pay the said amount there is a clear breach of section 73(1) of the contract law, cap.49, which provides that "when a contract has been broken, the party who suffers by such reach is entitled to receive from the party who has broken contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of thing from such breach r which the parties knew, when they made the contract, to be likely to result from the breach of it. Such compensation is not to be given of any remote and indirect loss or damage sustained by the reason of the breach."
From the evidence before me, I am satisfied that the contract has been broken by the defendants, and that the plaintiffs are entitled to receive from them compensation for their loss or damage caused to them amounting to £4,945. Regarding, however, the amount of damages claimed in paragraph 6(2) of the petition, damages at the rate of 8½ per centum per annum on the amount claimed under claim (1) as interest paid and/or lost as from the date of the delivery of the goods consigned and shipped to the consignees, I do not think that such a loss, when the parties, made the contract, was within the contemplation of the parties, and because in my view, such compensation is of remote and indirect loss.
The Order of this Court, is, therefore, judgment in favour of the plaintiffs for the sum of £4,945 with legal interest from today against the defendants with £181.900 mils, an amount of costs taxed by the Registrar.
Judgment and order
for costs as above.