N10334

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS 158 OF 2023

BETWEEN:
PETER CHARLES YAMA
Plaintiffs

AND:
SWIRE SHIPPING PTE LTD
Defendant

Waigani: Kangwia J.
2023:  14th & 19th June

CIVIL JURISDICTION – Refusal of consignees claim for release of containers – No release of Bill of Lading by Shipper – undisclosed claim of debt by Shipper – all charges and fees paid – actual ownership established - interest of Justice demands removal of veil on Bill of Lading.

Cases Cited:

Telikom v ICCC (2007) N3143
Yer, Secretary, Department of Finance v Yama (2009) SC996
Coconut Products Limited v Markham Farming Company Ltd (2018) SC1717

Counsel:

K. Makeu, for the Plaintiff
L. Evore, for the Defendant

19th June, 2023 

1.     KANGWIA J: The Plaintiff by originating summons sought the following orders:

1.	A declaration that the Plaintiff is a consignee and beneficiary to a Straight Bill of Lading held by the Defendant for a consignment of goods transported from Manila in the Philippines to the Port of Madang in Papua New Guinea on 24 April 2023 and 26 May 2023.
2.	A declaration that the Plaintiff being the consignee had duly settled all charges under the said Bill of Lading and is thus entitled to receive his consignment of good as per invoice no PG1INV2301634.
3.	An order that the Defendant shall immediately release to the Plaintiff all his consignment of Goods as settled for by way of payment made on 26 May 2023.
4.	The Defendants pay the Plaintiffs costs of this proceeding. And 
5.	Such further and other orders as this Honourable Court may deem fit.

2.      Pending determination of the substantive issues the Plaintiff by notice of motion moved for orders pursuant to Order 12 Rule 1 of the National Court Rules and s 155 (4) of the Constitution for the Defendant to release the two containers under the Defendant’s custody to the Smuggler’s Inn in Madang town, costs and other orders the Court deems appropriate or in the interest of justice.  He relies on his own affidavits filed on 6 June 2023 and 7 June 2023 respectively. He has given an undertaking as to damages in support of the application.

3.      The Defendant while conceding that the Plaintiff is the consignee and who had paid them for transporting the containers to Madang from Manila denies liability and asserts that they can only release the containers upon production of the Original Bill of Lading. It relies on the affidavit of Meike Ziegler who deposes as a Senior Legal Counsel for the Defendant.

4.     From information before the Court a Shipper named as Y.M.T.C. Trading sent goods in two 40-foot containers from the Port of Loading in Manila to the Plaintiff as consignee in Madang. The Defendant as carriers transported them from Manila to point of delivery in Madang. The Plaintiff paid the Defendant K47,3852.12 as invoiced for transporting the goods.  

5.      The Plaintiff further paid for all costs including customs duties and was given clearance to retrieve the containers. When he went to retrieve them, the Defendants refused to deliver based on an email communication by the Shipper to the Defendant not to release the goods as they were still in custody of the Original Bill of Lading owing to alleged unsettled fees and charges. Without the Original Bill of Lading the Defendant refused to release the containers because it is a requirement by established law that a Bill of Lading confers title. Being aggrieved by the refusal the Plaintiff sued the subject of this proceeding. 

6.      In submissions Mr Makeu for the Plaintiff submits that the Plaintiff is entitled to the containers under the custody of the Defendant after having met all the obligations imposed on him and settled all that he was invoiced. At the time of hearing there was no disclosure as to monies owing or invoices outstanding that was yet to be paid by the Plaintiff. That if no payment is alleged then there is none that is payable. 

7.      If there had been issues in Manila the containers would not have been released for travel to Madang in the first place. Because there were no issues in Manila the containers were transported to Madang. When it was allowed to be transported to Madang from Manila it was deemed that everything was settled. By refusing to release the containers the Plaintiff is being forced to incur storage and related fees for reasons unknown to him. 

8.      While relying on the case of Telikom v ICCC (2007) N3143 it is submitted that the Plaintiff has satisfied the requirements for urgent ex-parte applications that the balance of convenience favours the release of the containers. 

9.      If the containers were left to lie where they are it will incur storage and related fees at K140. per day and K200. per day for the next 83 days. To avoid that the container be released to the Plaintiff’s premises at Smugglers Inn pending resolution of the substantive issues of ownership. 
 
10.      On behalf of the Defendant Mr Evore while relying on the affidavit of Meike Zeigler opposes the notice of motion and submits that the Notice of Motion is an abuse of process and in breach of Order 4 Rule 49 (5) (f) of the National Court Rules when the Plaintiff is seeking a substantive relief by way of notice of motion. That was because Order 4 Rule 49 (9) provides for interlocutory matters only. He relied on the case of Yer, Secretary, Department of Finance v Yama (2009) SC996 and other case as supporting the rules referred to. 

11.     The other contention is that the Plaintiff is not entitled to the goods by law without providing the original Bill of Lading which recognises title to goods. He cites numerous overseas cases as supporting the proposition and asks the Court to adopt the Common law principles pursuant to Schedule 2.2 of the Constitution and in line with the case of Coconut Products Limited v Markham Farming Company Ltd (2018) SC1717. 

12.     He further refers to the case of Delta Kikori Ltd v ANDQ Trading Ltd (2017) N6707 and submits that a Bill of Lading is a document which entitles the holder to goods transported by sea. Therefore, the proceeding has no basis in law since the Plaintiff has no right to the goods without a Bill of Lading.

13.      The further propositions are that the status quo should be maintained as the Plaintiff has not done anything to take delivery of the goods and trying to obtain possession without being entitled under law. The other suggestion is that to minimise costs the Plaintiff should do all things necessary to take delivery of the goods or progress the substantive hearing as soon as possible. The potential prejudice the Defendant stands to suffer is greater if the relief sought in the notice of motion is granted. These considerations lie in favour of a refusal of the Plaintiff’s notice of motion.

The two contentions have not been challenged at all by the Plaintiff. 

14.     Without delving into the rights and wrongs of the objections, the legal technicalities and the Common Law relating to Bills of Lading, from the totality of the facts before me it suffices to state here that the present case revolves around the issue of who is the actual owner of the two containers held by the Defendant at its premises. 

15.     Therefore, it would do grave injustice to both parties to accept the arguments by Mr Evore and dismiss the application. The proper thing to do under the given circumstances is to dispense with the requirements and consider the main issue from the facts before me.  

16.     To answer the question in issue, the undisputed facts of this proceeding need to be revisited. According to the undisputed facts common sense and not common law dictates that the Plaintiff is the prima facie owner of the two containers now under the custody of the Defendant. 

17.     He has demonstrated actual ownership of the two containers in the absence of a Bill of Lading. The Plaintiff is named as the consignee in the shipping documents of the Defendant. He followed it up and made payments to the Defendant. The Defendant accepted from the Plaintiff the payments for services rendered in transporting the containers from Manila to Madang without reservations. By analogy the Defendant by its conduct admits the Plaintiff as the actual owner of the containers. 

18.     The Plaintiff paid customs and associated fees and obtained clearance for the release of the two containers. There is nothing to show that another person has a competing claim of ownership over the two containers.

19.     On the converse, the Defendant is stubbornly protecting the interest of the shipper who is not a party to this proceeding under the auspices of a lack of Original Bill of Lading which is said to be withheld by the Shipper. The only reason advanced by the Defendant to not release the two containers is that it will suffer prejudice in its reputation and being sued by the Shippers.

20.     From that line of argument by the Defendant, my view is that it is at best unreasonable for the Defendant to say it can only release the goods on production of the Bill of Lading in the face of glaring evidence that the Plaintiff is the actual owner of the goods. The question that follows is, how and under what circumstances did the Shipper allow the two containers to leave Manila in the first place if any payment was outstanding.
 
21.     At the date of hearing, despite the insistence of the Court, no invoices have been shown or disclosure made by the Shipper to the Defendant and demonstrate that the Plaintiff has outstanding dues. It is apparent that the Defendant relied only on an email message from the Shipper not to release the goods. Apart from the email message there is nothing that supports the proposition that the Plaintiff is properly denied the Bill of Lading. The email message without supporting documents displays a very sub-standard business practice by the Shipper. In turn the Shipper in my view has made the Defendant a scapegoat out of its own incompetencies and failures to the detriment of the Plaintiff and the Defendant. 
 
22.    The proper remedy for the Shipper is to sue the Plaintiff if it is still owed anything. It cannot continue to hold the Plaintiff and the Defendant to ransom on an unverified claim of outstanding claims which it could have easily demanded when the containers were at its disposal in Manila. 

23.    This type of behaviour by a company demands intervention of the Court and in its inherent jurisdiction remove the veil of the Bill of Lading in the interest of justice. By doing so it will relieve the Plaintiff from incurring storage fees and associated costs. It nonetheless will also operate in favour of the Defendant to avert the fear of being sued. In light of the foregoing, the orders sought in the Notice of motion shall be granted.

Formal Orders

1.	The Defendant shall release the Plaintiffs consignment of good contained in two 40 foot containers described as BHCU4962958 and TLLU7734018 held at Madang Wharf by the Defendants under Bill of Lading Number PH00001400 be released to the custody of the Plaintiff and be kept at the Plaintiffs premises at Smugglers Inn in Madang town pending determination of the substantive proceeding.

2.	Each party shall bear their own costs.

________________________________________________________________
Makeu Legal Services: Lawyers for the Plaintiff
Ashurst PNG Lawyers: Lawyers for the Defendant