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New Guinea Cocoa (Export) Co Pty Ltd v Vedbaek, Owner of MV 'Aya Trigon' [1980] PNGLR 205 (29 August 1980)

Papua New Guinea Law Reports - 1980

[1980] PNGLR 205 - New Guinea Cocoa (Export) Co Pty Ltd v Basis Vedbaek, Owner of MV "Aya Trigon" 

[1980] PNGLR 205

N251

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

NEW GUINEA COCOA (EXPORT) CO. PTY. LTD.

V

BASIS VEDBAEK, THE OWNER OF THE M. V. “AYA TRIGON”

Waigani

Bredmeyer AJ

25-26 June 1980

29 August 1980

SHIPPING AND NAVIGATION - Admiralty jurisdiction - Law and practice - Jurisdiction of National Court - Claim for necessaries supplied to foreign ship - Law applicable - Colonial Courts of Admiralty Act 1890 no longer in force in Papua New Guinea - No action in rem for necessaries - Common law of contract applicable to supply of goods and services.

SHIPPING AND NAVIGATION - Law and practice - Goods and services supplied to foreign vessel - Cause of action in contract - Implied authority for port charges, cargo expenses and sundry expenses reasonably incurred - Specific authority required for purchases of major items.

SHIPPING AND NAVIGATION - Law and practice - Arrest of foreign vessel - National Court - Power to order - Semble by way of interlocutory relief - Constitution s. 155 (4).

In an action in rem brought against the M.V. “Aya Trigon” a foreign vessel in respect of necessaries supplied to the vessel (which included claims for port charges, cargo expenses, bulk fuel and sundry expenses), it was argued that the statement of claim did not disclose a cause of action known to the law of Papua New Guinea.

Held

(1)      The cause of action in rem for necessaries supplied to a foreign vessel was abolished in Papua New Guinea by virtue of the repeal of the Colonial Courts of Admiralty Act 1890 (Imp.), by the Papua New Guinea Independence Act 1975, on Independence.

Milan Capek v. The yacht “Freja” (No. 2) [1980] P.N.G.L.R. 161 per Miles J. at p. 168; and

Milan Capek v. The yacht “Freja” [1980] P.N.G.L.R. 57 per Kapi J. not followed.

(2)      The Admiralty Courts Acts 1840 and 1861 are no longer applicable in Papua New Guinea for the same reason.

(3)      The cause of action for necessaries supplied to a foreign ship, being now a statutory one in England under the Supreme Court of Judicature Act 1925 (U.K.), forms no part of the common law of England adopted into Papua New Guinea under Sch. 2.2 of the Constitution.

(4)      The common law of contract and quasi-contract is applicable and appropriate to the circumstances of Papua New Guinea, and is adequate to enable recovery of payment for goods and services supplied to a foreign vessel.

(5)      Semble the National Court of Justice has power under s. 155(4) of the Constitution to order the arrest of a ship by way of interlocutory relief at the outset of an action.

Mauga Logging Company Pty. Ltd. v. South Pacific Oil Palm Development Pty. Ltd. (No. 1) [1977] P.N.G.L.R. 80; and

Nippon Yusen Kaisha v. Karageorgis & Anor [1975] 3 All E.R. 282 referred to.

(6)      When a shipping agent agrees to act for a foreign vessel, it is implied that the agent will incur expenses on behalf of the ship for port charges, cargo expenses, and sundry expenses including requests by the master of a normal and usual kind in the shipping business, but an agent normally requires specific authority from the client for the purchase of major items such as bulk fuel.

(7)      In the circumstances there was no contract between the defendant as owner of the M.V. “Aya Trigon” and the plaintiff and judgment should be entered for the defendant.

Action

This was an action in the National Court in which the plaintiff sued in respect of “necessaries” supplied to a foreign vessel. At the beginning of the trial it was argued that the statement of claim did not disclose a cause of action known to Papua New Guinea.

Counsel

M. White, for the plaintiff.

I. Molloy, for the defendant.

Cur. adv. vult.

29 August 1980

BREDMEYER AJ: This action is brought in the admiralty jurisdiction of this Court. It is an action in rem brought against the M.V. “Aya Trigon” in respect of “necessaries” supplied to the vessel when it berthed in Port Moresby in October 1978 and later anchored in the inner harbour for a month. The “Aya Trigon” is a foreign vessel. The plaintiff conducts business inter alia as shipping agents in Rabaul but not in Port Moresby. It arranged for a Port Moresby firm of shipping agents, J. C. Waller & Co. Pty. Ltd. (hereinafter “J. C. Waller”), to attend to the ship in Port Moresby. That firm arranged for the berth of the vessel and its entry into the port. It paid the berthage and pilotage charges and other charges. It paid the stevedores’ charges for unloading the cargo. It also purchased fifty-seven tons of bulk fuel costing K8,381.45 for the vessel and various other provisions. Altogether the money spent by J. C. Waller on providing goods and services to the vessel together with its charges for its own services came to K12,618.27. J. C. Waller collected K7,797.94 from consignees of cargo discharged in Port Moresby, which had been shipped freight collect, leaving a balance of K4,820.33 owing to it. The plaintiff has paid this sum to J. C. Waller and has brought this action to recover the same against the ship. As is the practice in this jurisdiction, the vessel was arrested, the money was paid into court as bail to secure its release and the vessel was released.

As stated above the plaintiff’s action is brought in the admiralty jurisdiction of this Court; it is an action in rem which explains why the vessel was arrested before any judgment issued; and the statement of claim says that the action is for “necessaries supplied to the vessel”. At the outset of the trial Mr. Molloy, counsel for the defendant, contended that the statement of claim did not disclose a cause of action known to the law of Papua New Guinea. I consider that this submission is correct—that the cause of action in rem for necessaries supplied to a vessel was abolished by statute on Independence. I wish to explain how that came about and I later consider what other law should be applied to determine this dispute.

The High Court of Admiralty in England was given jurisdiction to hear claims for necessaries supplied to foreign ships by s. 6 of the Admiralty Court Act 1840 (3 & 4 Vic. c. 65) which reads as follows:

“s6.    The court, in certain cases, may adjudicate on claims for services and necessaries, etc., although not on the high seas. The High Court of Admiralty shall have jurisdiction to decide all claims and demands whatsoever in the nature of salvage for services rendered to or damage received by any ship or sea-going vessel, or in the nature of towage, or for necessaries supplied to any foreign ship or sea-going vessel, and to enforce the payment thereof, whether such ship or vessel may have been within the body of a country, or upon the high seas, at the time when the services were rendered or damage received, or necessaries furnished, in respect of which the claim is made.”

This jurisdiction was extended to certain English ships by s. 5 of the Admiralty Court Act 1861 (24 & 25 Vic. c. 10) which reads as follows:

“s5.    As to claims for necessaries supplied to ships. The High Court of Admiralty shall have jurisdiction over any claims for necessaries supplied to any ship elsewhere than in the port to which the ship belongs, unless it is shown to the satisfaction of the Court that at the time of the institution of the cause any owner or part owner is domiciled in England or Wales: Provided always, that if in any such cause the plaintiff do not recover twenty pounds, he shall not be entitled to any costs, charges, or expenses incurred by him therein, unless the judge shall certify that the cause was a fit one to be tried in the said Court.”

The High Court of Admiralty had power to hear actions in rem (against a thing) or in personam (against a person). The court’s rules provided that an action in rem was commenced by the court issuing a warrant for the arrest of the ship (and/or cargo and freight). Bail or other security could be given to secure the release of the ship. If the plaintiff succeeded in proving his claim the ship could be sold by the marshall to meet the claim. There was nothing to stop a plaintiff who had supplied goods or services to a vessel to sue the master who had requested them, or his principal, say the owner, in personam in the admiralty jurisdiction, see s. 35 of the Admiralty Court Act 1861 (Imp.), nor to stop the plaintiff suing the shipowner under the law of contract in the common law courts, (see s. 23 of the Admiralty Court Act 1840 (Imp.)). But the great advantage of the action in rem available to a plaintiff in the High Court of Admiralty was that it enabled the ship to be arrested at the outset so that if the plaintiff succeeded in proving his case, the ship could be sold to meet the judgment debt. Contrast this with the action in personam: the plaintiff may have difficulty in serving the writ of summons on the owner, and if he succeeds in proving his case, he then may be unable to enforce his judgment because the defendant’s assets are outside of the country. The action in rem was brought against the ship, and, as stated, was commenced by the arrest of the ship and if the claim was proved the ship would be sold and the claim paid out of proceeds of sale. The action was against the res itself, the res was never known as the defendant or regarded as a party to the action, and although owners or persons interested could appear and defend the writ their presence or absence was not of much importance[cccxxvi]¹. But since the case of The Dictator[cccxxvii]² in 1892 which was followed in The Gemma[cccxxviii]³ and The Dupleix[cccxxix]⁴, an owner who appears to an action in rem, can be held personally liable, that is, beyond the value of the res or his bail undertaking in lieu thereof, and a writ of fieri facias will lie against any of his property within the jurisdiction, be it other ships or goods, to recover the judgment debt. If the owner enters an appearance, the action in rem proceeds just as an action in personam. If an owner of the res does not enter an appearance, however, he cannot lose more than its value in a successful action in rem: The Banco[cccxxx]⁵.

The legislative steps by which the pre-Independence Supreme Court of Papua and New Guinea acquired admiralty jurisdiction are correctly related in the judgments of Kapi J. in Milan Capek v. The Yacht “Freja”[cccxxxi]⁶ and Miles J. in the case of Milan Capek v. The Yacht “Freja” (No. 2)[cccxxxii]⁷. To reiterate briefly the Colonial Courts of Admiralty Act 1890 of United Kingdom[cccxxxiii]⁸ conferred admiralty jurisdiction upon the Central Court of British New Guinea and that jurisdiction was continued in force in the territory of Papua by ss. 6(1) and 8 of the Papua Act, 1905. The Colonial Courts of Admiralty Act 1890 (Imp.) did not apply of its own force to the Mandated Territory of New Guinea because that territory was not a British possession but the Act was a law in force in Queensland and I agree with the learned editor of the Laws of The Territory of New Guinea 1927-1945 that it was a law applicable to the circumstances of the territory and not repugnant to or inconsistent with any other law in force in the territory and hence it became an adopted law of New Guinea under s. 14 of the Laws Repeal & Adopting Ordinance 1921[cccxxxiv]⁹. Also the Judiciary Ordinance 1921 of New Guinea created a Central Court for the territory, later renamed the Supreme Court, and by s. 11 conferred on it the like “jurisdiction, power and authority” as the Supreme Court of Queensland—which included its admiralty jurisdiction, inter alia, to try claims for necessaries supplied to ships.

The Papua-New Guinea Provisional Administration Act 1945 (Aust.) combined the two territories under an Administrator and by s. 16 established the Supreme Court of the Territory of Papua New Guinea. It gave to that court the same jurisdiction as the previous Supreme Court of Papua had in relation to Papua and as the previous Supreme Court of New Guinea had in relation to New Guinea. That Act was replaced by the Papua and New Guinea Act 1949 (Aust.) which also repealed the Papua Act 1905 and the New Guinea Act 1920. Section 32 of the Papua and New Guinea Act 1949 kept in force all the laws which previously applied in the respective territories of Papua and New Guinea which included the Colonial Courts of Admiralty Act. Section 58 of the Papua and New Guinea Act 1949 created a new Supreme Court of the Territory of Papua and New Guinea and s. 62 provided that its jurisdiction practice and procedure was to be established by an Ordinance. That Ordinance was the Supreme Court Ordinance 1949 which repealed the Courts & Laws Adopting Ordinance 1888 of Papua and the Judiciary Ordinance 1921 of New Guinea and which by s. 6 gave to the new Supreme Court the same jurisdiction previously exercised by the Supreme Court of Papua New Guinea. Thus by the two provisions, s. 32 of the Papua and New Guinea Act 1949 and s. 6 of the Supreme Court Ordinance 1949, the Colonial Courts of Admiralty Act continued to apply and the Supreme Court of Papua and New Guinea continued to exercise the admiralty jurisdiction conferred by that British Act which had been exercised by the pre-war Supreme Courts of Papua and of New Guinea.

That admiralty jurisdiction continued until Independence when the Papua and New Guinea Act 1949 was repealed by the Papua New Guinea Independence Act 1975 (Aust.) and the Supreme Court Ordinance 1949 was repealed by the Statute Law Revision (Independence) Act 1975 (No. 92 of 1975). Independent Papua New Guinea is not a British possession so the Colonial Courts of Admiralty Act does not apply to Papua New Guinea of its own force.

Has this admiralty jurisdiction survived Independence? As stated the Colonial Courts of Admiralty Act 1890 was adopted into the territories of Papua and of New Guinea. I agree with Miles J. that the Act initially applied of its own force to British New Guinea but was then adopted in the Papua Act 1905, and it was adopted at the outset in New Guinea[cccxxxv]¹⁰. This adopted law was continued in force until Independence by virtue of s. 32 of the Papua and New Guinea Act 1949. That Australian Act was repealed by another Australian Act, the Papua New Guinea Independence Act 1975 which means, ex facie, that the laws kept in force by s. 32 of the 1949 Act were repealed by the 1975 Australian Act. However in an overlapping legislative provision, the Laws Repeal Act 1975 purports to repeal laws of the pre-war territories of Papua and New Guinea, including adopted English statutes, kept in force by the Papua and New Guinea Act 1949. It purports to repeal those laws, which would include the Colonial Courts of Admiralty Act 1890, and then Sch. 2.6 of the Constitution adopts them as part of the laws of Independent Papua New Guinea. The Laws Repeal Act 1975 was a law passed by the House of Assembly which in turn was constituted and derived its powers from the Papua and New Guinea Act 1949 as amended. Faced with these overlapping statutory provisions and giving effect to the hierarchy of legislatures, the House of Assembly being dependent on the Australian Parliament for its powers, I conclude that the Papua New Guinea Independence Act 1975 repealed the operation of the Colonial Courts of Admiralty Act in Papua New Guinea and that the Laws Repeal Act 1975 did not do so; that its purported exercise of repealing power was not effective.

I am fortified in this view by a number of considerations. First, as explained above, in addition to the Colonial Courts of Admiralty Act 1890 being adopted into the territories of Papua and of New Guinea and then being kept in force in Papua New Guinea, s. 6 of the Supreme Court Ordinance 1949 preserved the admiralty jurisdiction exercised by the pre-war Supreme Courts of Papua and of New Guinea. The Supreme Court Ordinance 1949 was repealed by the Statute Law Revision (Independence) Act 1975 which came into force immediately before the Laws Repeal Act 1975 which means that that admiralty jurisdiction was not revived under Sch. 2.6 of the Constitution. Secondly, the sections in the Constitution conferring jurisdiction on the National Court of Justice do not preserve any jurisdiction exercised by the pre-Independence Supreme Court. Neither does the National Court Act 1975 save any pre-Independence jurisdiction although it does save the pre-Independence Rules of Court. Thirdly, the Constitution framers appear to have given considerable care to stipulate which Imperial statutes should apply after Independence and the Colonial Laws of Admiralty Act 1890 is not included among them. It is not one of the Imperial Statutes adopted in Sch. 5 of the Constitution although seven of the eight Acts adopted in that Schedule relate to shipping. Neither is the 1890 Act—nor the relevant sections of the Admiralty Courts Acts of 1840 and 1861—re-enacted in the Imperial Laws Replacement Act 1975. For these reasons I have come to the opposite view to that expressed by Kapi and Miles JJ. in Milan Capek v. The Yacht “Freja”[cccxxxvi]¹¹. I consider that this Court no longer has the admiralty jurisdiction conferred on the pre-Independence Supreme Court by the Colonial Courts of Admiralty Act 1890.

I consider that s. 6 of the Admiralty Court Act 1840 and s. 5 of the Admiralty Court Act 1861 which are quoted above fall with the Colonial Courts of Admiralty Act 1890 and are no longer in force in Papua New Guinea. Those sections, so far as they concern this case, confer jurisdiction on the High Court of Admiralty to hear claims in rem for necessaries. I do not consider that they were adopted into Papua under the Courts & Laws Adopting Ordinance 1888 of British New Guinea or into New Guinea under the Laws Repeal and Adopting Ordinance 1921 of New Guinea, although the learned editor of the Laws of The Territory of Papua and the Laws of The Territory of New Guinea considered the 1840 Act (3 & 4 Vic. c. 65) was adopted, but that the 1861 Act (24 & 25 Vic. c. 10) was not[cccxxxvii]¹². I do not think that those Acts were, by themselves, applicable to the circumstances of those colonies. Those sections expressly conferred jurisdiction on the High Court of Admiralty in England; they became relevant to Papua and New Guinea only because the Colonial Courts of Admiralty Act 1890 conferred the English admiralty jurisdiction on colonial courts. The 1890 Act adopted in both Papua and New Guinea conferred English admiralty jurisdiction on the courts of those territories and the sections quoted of the 1840 and 1861 Acts defined part of that jurisdiction. I do not consider that the 1840 and 1861 Acts would have been applicable to either territory if there had been no 1890 Act. I consider that when the jurisdiction conferred by the adoption of the Colonial Courts of Admiralty Act 1890 and by s. 6 of the Supreme Court Ordinance 1949 ceased to exist in Papua New Guinea the jurisdiction to hear claims in rem for necessaries ceased to exist with it.

As I have stated, the action in rem for necessaries supplied to ship was created by the sections already quoted of the Admiralty Act of 1840 and 1861 of England. Those sections were replaced in England by a similar provision in the Supreme Court of Judicature Act 1925 which was in turn replaced by a section in the Administration of Justice Act 1956. The latter Act re-defined the admiralty jurisdiction of the High Court and was passed to give effect to the International Convention relating to the Arrest of Sea-going Ships signed in Brussels in 1952. The Administration of Justice Act has avoided using the term “necessaries”. The relevant section reads as follows:

“s(1)(l)          The Admiralty jurisdiction of the High Court shall be as follows, that is to say, jurisdiction to hear and determine any of the following questions or claims:

(m)     any claim in respect of goods or materials supplied to a foreign ship for her operation or maintenance.”

The cause of action has thus remained a statutory one in England which means that it forms no part of the common law of England adopted in Papua New Guinea under Sch. 2.2 of the Constitution.

Mr. White, counsel for the plaintiff, argued that as the statutory cause of action has ceased to exist and the cause of action is not part of the common law then there is a gap in the law and it is my duty to formulate an appropriate rule of law under Sch. 2.3(1) of the Constitution to fill the gap. That section reads as follows:

“If in any particular matter before a court there appears to be no rule of law that is applicable and appropriate to the circumstances of the country, it is the duty of the National Judicial system, and in particular of the Supreme Court and the National Court, to formulate an appropriate rule as part of the underlying law having regard:

(a)      in particular to the National Goals and Directive Principles and the Basic Social Obligations; and

(b)      to Division III.3 (basic rights); and

(c)      to analogies to be drawn from relevant statutes and custom; and

(d)      to the legislation of, and to relevant decisions of the courts of, any country that in the opinion of the court has a legal system similar to that of Papua New Guinea; and

(e)      to relevant decisions of courts exercising jurisdiction in or in respect of all or any part of the country at any time,

and to the circumstances of the country from time to time.”

He argued that an appropriate law for me to formulate would be the English law on necessaries as it existed in say 1890, or, if I wish to update the law, as it existed pre-Independence in 1975. I do not accept this submission. There is no relevant rule of customary law. I think the common law of contract and quasi-contract is applicable and appropriate to the circumstances of the country and is adequate to recover payment for goods and services supplied to a ship when it calls at a port in Papua New Guinea. The common law is that when a master orders goods and services he is personally liable to pay for them and, if it can be shown that he is acting on behalf of a principal, be it the shipowner or a charterer, then the principal is also liable to pay. I do not consider it unreasonable to apply the common law of contract to the circumstances of a shipping agent in Papua New Guinea supplying goods to a foreign vessel. A shipping agent is not forced by law to supply goods and services to a visiting foreign vessel. Any supplier of goods and services to a person who is not ordinarily resident in Papua New Guinea must decide whether he is going to supply the goods and services on credit and risk the possibility of not being paid, or to get payment in advance. As James Duncan, the plaintiff’s experienced shipping manager, said in his evidence —when a foreign ship requests the supply of goods and services from a shipping agent and that agent has never dealt with that vessel or shipping company before, it is prudent for the agent to get money on account in advance. In these days of modern communications, of radio telephone to the master at sea, of international telex and telephone contact with his principal overseas, and the speedy transfer of funds by telegraphic transfer and other means, it would not be difficult for a shipping agent to seek and obtain payment in advance.

It seems to me that the cause of action for necessaries in the admiralty jurisdiction of the High Court of England is really a form of action in contract with the additional procedural advantage that the vessel may be arrested at the outset to ensure that if the plaintiff succeeds in winning a court order, he will also succeed in recovering payment of the same. This point is well made in the judgment and well illustrated by the facts, of Shell Oil Company v. The Ship “Lastrigoni”[cccxxxviii]¹³. In that case Shell Oil provided bunkers to the “Lastrigoni” in various ports in different countries and its bill was not paid. Shell brought an action in rem for necessaries under s. 6 of the Admiralty Act 1840 and s. 5 of the Admiralty Court Act 1861. The ship was arrested in Melbourne. The shipowner defended the action on the basis that when the fuel was supplied to the ship it was supplied pursuant to a written contract between Shell and the charterer. Clearly then the owner of the ship was under no contractual liability to pay for the fuel. Shell claimed that the fuel was “necessaries supplied to a ship” within the meaning of ss. 5 & 6 of the Acts mentioned and that therefore the owner was liable to pay for it. Mr. Justice Menzies of the High Court of Australia held that that was not so; that although in a physical sense the fuel was supplied to the ship, in a legal sense, the fuel was not supplied for the owner but supplied at the request of and to the cost of the charterer. The charterer was the buyer of the fuel so the owner was under no liability to pay for it. The learned judge held that an action in rem in the admiralty jurisdiction cannot succeed where there is no express or implied contractual liability on the part of the owner to pay. He said that the action in rem is intended to facilitate the enforcement of liabilities and not to allow pressure to be put on a person, who is himself under no liability, to pay for the liabilities of others.

Mr. White, counsel for the plaintiff said in support of his argument that I should declare the English law of necessaries to be part of the underlying law of this country under Sch. 2.3 of the Constitution, that this country, and every country, needs a law to allow for the speedy arrest of ships to ensure that ships do not escape from the jurisdiction before they have paid their debts incurred in the country. I agree that Papua New Guinea needs such a law. Papua New Guinea had up to Independence and may still have, a law empowering the arrest of a ship under O. 7, r. 11 of the Rules of the National Court and/or under the Admiralty Rules of 1926 which applied to Papua[cccxxxix]¹⁴. Australia and all the countries to which the Colonial Courts of Admiralty Act 1890 apply have such a law. As seen above the English power of arrest is now found in the Administration of Justice Act 1956. Many non-British countries have a law allowing for the arrest of vessels as can be seen by the fact that International Convention on the Arrest of Sea-going Ships was signed in Brussels in 1952 to ensure some uniformity in the arrest laws in different countries.

I agree that Papua New Guinea needs a law to allow for the arrest of ships but it does not follow that I should find the English law on necessaries to be part of the underlying law of Papua New Guinea. I consider that the power to arrest a ship and the substantive cause of action for goods and services supplied to a ship are logically distinct. I consider the National Court of Justice has adequate power to order the arrest of a ship by way of interlocutory relief at the outset of an action. By s. 166 of the Constitution it is a court of “unlimited jurisdiction” and by s. 155(4) it has an inherent power to make such “orders as are necessary to do justice in the circumstances of a particular case”. That power was applied by Frost C.J. in Mauga Logging Company Pty. Ltd. v. South Pacific Oil Palm Development Pty. Ltd. (No. 1)[cccxl]¹⁵ to give interlocutory relief to a plaintiff, to ensure that the defendant did not skip the country with its assets before the trial of the cause of action. Lord Denning made a new law in England and gave similar interlocutory relief in a case where previously no interlocutory injunction would have been available in Nippon Yusen Kaisha v. Karageorgis and Another[cccxli]¹⁶.

In this present case the warrant of arrest was issued under O. 7, r. 11 of the Rules of the National Court or under the Admiralty Rules 1926 of Papua both of which are continued in force by virtue of s. 14 of the National Court Act 1975. As the validity of the arrest has not been challenged before me and as I consider that s. 155(4) of the Constitution would, in any event, have justified an interlocutory order of arrest, it is not necessary for me to rule on the validity of the arrest of the vessel.

As I have found that the action in rem for necessaries in Papua New Guinea no longer exists, the plaintiff’s cause of action as pleaded fails. But as I consider that the common law of contract applies I should examine whether the plaintiff’s claim succeeds in contract. The plaintiff’s claim in contract is against the shipowner, Basis Vedbaek of Denmark. Although the owner is not named as the defendant in the writ of summons nor has it filed an appearance, the sum claimed in the writ of summons was paid into court with a denial of liability by the owner and Mr. Molloy has represented the owner at the trial before me, I therefore consider that I should amend the name of the defendant to read “Basis Vedbaek the owner of the M.V. ‘Aya Trigon’ ”.

The plaintiff’s case in contract was that there was an implied contract between the plaintiff and the defendant shipowner to provide goods and services for the vessel when it came to Port Moresby. The master ordered goods and services from the plaintiff and it was implied and understood that those goods and services were ordered on behalf of the owner. The plaintiff argued that prior to entering the port, the vessel’s charterer, Yuma Shipping of Hong Kong, had requested the plaintiff to act as its shipping agent in Papua New Guinea and the plaintiff had replied by telex that it would do so on the condition that Yuma Shipping paid K18,000 to the plaintiff in advance. This was a condition precedent of the contract; the condition was not met, the money was not paid and hence no contract was made between Yuma Shipping and the plaintiff. That abortive arrangement with Yuma Shipping was superseded by a new contract between the plaintiff and the defendant shipowner when the master ordered goods on behalf of the defendant. The defendant’s argument in reply to this was that the first and only contract made was between Yuma Shipping and the plaintiff. Yuma Shipping by telex asked the plaintiff to act as its shipping agent in Papua New Guinea. The plaintiff accepted that offer. The plaintiff did ask for K18,000 in advance but the money did not come so the plaintiff waived its request for it and performed its services on credit. The defendant argues that all the goods supplied were within the express or implied terms of the contract between the plaintiff and Yuma Shipping and that at no time did the master order goods on behalf of the defendant.

The plaintiff called three witnesses and tendered a number of documentary exhibits mainly invoices and telexes. The defendant did not call any evidence. The three witnesses called by the plaintiff were experienced shipping agents, they gave their evidence in a straightforward way, their testimony was not seriously challenged or damaged in cross-examination, the testimony of each witness was consistent with that of the others and I accept all their evidence as truthful.

As mentioned on p. 218 of these reasons, the cost of the goods and services supplied to the plaintiff to the ship totalled K12,618. That sum is made up of twenty items listed on exhibit “A” divided into three categories. I propose to divide them into four categories as follows: port charges (port dues, berthage dues, pilotage etc.), cargo expenses (stevedores’ charges for unloading the cargo), bulk fuel (which cost K8,381) and sundry expenses (food and drink, medical expenses for sick crew members, ‘phone calls and telexes, shipping agent’s fee etc.). I accept the evidence given that when a shipping agent agrees to act for a ship in Papua New Guinea it is implied that the agent will incur the following expenses on behalf of the ship: port charges, cargo expenses, and sundry expenses including requests by the master of a normal and usual kind in the shipping business—but that an agent normally requires specific authority from the client before he will purchase major items like bulk fuel.

Weighing up the oral and documentary evidence put before me I make the following findings of fact:

1.       In early October 1978 Yuma Shipping of Hong Kong (hereinafter “Yuma”), the charterer, asked the plaintiff by telex to act as its shipping agent for the vessel’s voyage to Papua New Guinea. Mr. Duncan, the plaintiff’s shipping manager, agreed to act and by a ‘phone call with Mr. Dunbaven, the manager of J. C. Waller, engaged that company to act as its sub-agent in Port Moresby.

2.       On 14th October, 1978, Yuma telexed the plaintiff advising and, in effect, instructing the plaintiff to arrange for the discharge of all cargo in Port Moresby and for the supply of fifty tons of bunkers (that is, bulk fuel). On 16th October the plaintiff telexed Yuma and advised that K18,000 would be required to be paid. The money was not paid and there was no further mention between Yuma and the plaintiff of this sum.

3.       On receipt of the plaintiff’s telephone instructions to act, J. C. Waller’s staff began making arrangements for the berth of the ship etc. before they had any direct contact with the master.

4.       The ship berthed at Port Moresby on the afternoon of 19th October, 1978, and left the berth on the afternoon of the next day to anchor in the harbour. Most of the goods and services supplied by the plaintiff were supplied during these twenty-four hours while the vessel was berthed at the main wharf.

5.       The plaintiff did not stipulate the payment of K18,000 as a condition precedent to it agreeing to act as its shipping agent. It requested payment in advance, did not get it, and by engaging J. C. Waller to act as Moresby agent and by that firm carrying out its tasks without insisting on the money in advance, waived its own request. The contract was thus for the supply of goods and services on credit.

6.       The outgoings paid by the plaintiff under the headings of port charges, cargo expenses and sundry expenses were all reasonable and normal expenses to have been incurred by a ship’s agent. It is true that some of the sundry expenses were incurred at the specific request of the master, for example, a cash advance of K300 and medical treatment for a crew member K30, but as I have said, it is implied when a firm agrees to act as shipping agent that it will agree to meet any normal and reasonable requests of the master. I accept the evidence of Mr. Dunbaven, a very experienced shipping agent, that all the sundry expenses incurred at the request of the master were normal and reasonable. The master’s requests to the plaintiff did not constitute a new contract between the master, as agent for the defendant shipowner, and the plaintiff.

7.       The bulk fuel was supplied pursuant to Yuma’s telex to arrange for the supply of fifty tons of bunkers. The actual amount of fuel supplied was about fifty-seven tons but I do not regard this quantity to be so excessive as to amount to a new contract between the master, on behalf of the shipowner, and the plaintiff. In the process of supplying the fifty tons requested by Yuma, by telex presumably, the master or some crew member on his behalf requested a further seven tons. I would reasonably infer from this that the extra fuel was requested on behalf of Yuma. In the face of the telex request from Yuma it would not be reasonable for me to infer that in requesting fifty-seven tons the master was purporting to purchase the seven tons, or the fifty-seven tons, on behalf of the shipowner.

8.       Neither the plaintiff nor J. C. Waller had any contact with the owner either before or after the goods and services were supplied. At no stage did the master represent in his dealings with J. C. Waller that he was ordering goods on behalf of the defendant shipowner. At no time did J. C. Waller’s manager believe that his company was acting on behalf of the shipowner. The manager’s instructions to supply goods and services to the ship came from the plaintiff in Rabaul and he knew that the plaintiff was acting on behalf of Yuma. On 21st October the master telexed the defendant in Denmark from J. C. Waller’s office as follows: “Please contact local agent to look after ship’s interest. Vessel at anchor. Unable to contact you.” This appears to have been an attempt by the master, made after nearly all of the expenses had been incurred, to get the owner to pay J. C. Waller, due to non-funding by Yuma; but it failed. There was no response.

9.       On 21st November, 1978, the plaintiff telexed Yuma advising that the plaintiff was no longer acting for Yuma in Papua New Guinea, thus terminating the agreement. I am satisfied that there was no implied contract between the master, acting on behalf of the defendant, and the plaintiff. The plaintiff had had no past dealings with Yuma and apparently knew nothing of its financial standing. The plaintiff could have insisted on payment in advance; it did not do so. It incurred expenses and charges of over K12,618 on behalf of Yuma on credit. It was able to recover about K7,797 from freight. The plaintiff must look to Yuma for payment of the balance.

Counsel for the plaintiff argued there was a presumption of law that when necessaries are supplied to a vessel that the shipowner is liable to pay for them and relied on “The Perla”[cccxlii]¹⁷. That is a very old and slender authority and I can find no reference to it in recent cases or text books. Assuming it is part of the common law of England pre-16th September, 1975, I do not consider it appropriate or relevant to the circumstances of Papua New Guinea. That is because many vessels that call at Papua New Guinea’s ports are on charter so that when the master orders goods he may be acting on behalf of the owner or the charterer. It is reasonable to expect a prudent supplier, if he is going to supply the goods on credit, to find out which it is. However if I be wrong on this and that presumption is part of the adopted common law of this country, I consider that there is ample evidence of the existence of a contract between the plaintiff and Yuma to rebut it.

Judgment will be entered for the defendant with costs to be agreed upon on, or failing agreement, to be taxed. I direct the Registrar to repay the money paid into court to the defendant’s solicitors. I certify that the case was an appropriate one for the engagement of overseas counsel.

Judgment for the defendant.

Solicitors for the plaintiff: Gadens.

Solicitor for the defendant: Craig Kirke & Wright.

[cccxxvi] McGuffie and Ors., British Shipping Laws, vol. 1, par. 8.

[cccxxvii] [1892] P. 304.

[cccxxviii] [1899] P. 285.

[cccxxix] [1911] P. 8.

[cccxxx] [1971] 1 All E.R. 524 at p. 531, per Lord Denning.

[cccxxxi] [1980] P.N.G.L.R. 57.

[cccxxxii] [1980] P.N.G.L.R. 161.

[cccxxxiii] Conveniently reprinted in Laws of the Territory of Papua 1888-1945 (Annotated), vol. 1, pp. 857-869.

[cccxxxiv] Laws of the Territory of New Guinea 1921-1945 (Annotated), vol. 5, pp. 67-68.

[cccxxxv] Milan Capek v. The Yacht “Freja” (No. 2) [1980] P.N.G.L.R. 161 at p. 168.

[cccxxxvi] [1980] P.N.G.L.R. 57.

[cccxxxvii] Laws of the Territory of Papua 1888-1945 (Annotated), vol. 5, p. 91 and Laws of the Territory of New Guinea 1921-1945 (Annotated), vol. 5, p. 68.

[cccxxxviii] (1974) 48 A.L.J.R. 295.

[cccxxxix] These rules are published in Laws of the Territory of Papua 1888-1945 (Annotated), vol. 1, pp. 870-881.

[cccxl] [1977] P.N.G.L.R. 80.

[cccxli] [1975] 3 All E.R. 282.

[cccxlii] (1858) S.W. 353; 166 E.R. 1164.