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King Trader Ltd v Bintan Mining SI Ltd [2021] SBCA 1; SICOA-CAC 24 of 2019 (1 February 2021)

IN THE SOLOMON ISLANDS COURT OF APPEAL


Case name:
King Trader Ltd v Bintan Mining SI Ltd


Citation:


Decision date:
1 February 2021


Nature of Jurisdiction
Appeal from Judgment of the High Court of Solomon Islands (Keniapisia J)


Court File Number(s):
24 of 2019


Parties:
Trader Limited, MV Solomon Trader v Bintan Mining SI Limited, Bintan Mining Corporation


Hearing date(s):
Paper Hearing October 2020 Sitting


Place of delivery:



Judge(s):
Goldsbrough P
Lunabek JA
Gavara-Nanu JA


Representation:
Radclyffe A for the Appellant
Ivanisevic J and Togamae K W and Teddy P for the Respondent


Catchwords:
Pre actions disclosure


Words and phrases:


Legislation cited:
Solomon Islands Civil Procedure Rule 2007 17.74, 17.75, 11.23, 11.26


Cases cited:
Lilo v Kennedy [2014] SBCA 7


ExTempore/Reserved:
Reserved


Allowed/Dismissed:
Dismissed


Pages:
1-20

JUDGMENT OF THE COURT

  1. The First and Second Appellants are King Trader Limited (1st appellant) and MV Solomon Trader (2nd appellants) respectively. Unless a reference is made in this judgment which applies to only one of them, they will be referred to collectively as the appellants.
  2. Bintan Mining SI Limited and Bintan Mining Corporation are the respondents and the same naming convention as set out above will apply equally to them.
  3. Substantive proceedings in this matter have not started but an urgent interlocutory application seeking relief prior to commencement of proceedings was filed on 28 March 2019. That urgent interlocutory application sought several orders which were:-
    1. Restrain the Defendants, agents and servants not to interfere with the claimants’ agents to board and examine the Ship (herein known as Solomon Trader) which was grounded at Rennell Island, Solomon Islands.
    2. Allowed the claimant’s servants, agents and employees’ access to the Vessel to examine and inspect it, inclusiveness of the cargo and the bunker without any hindrance from the defendants’ servants, agents and employees for the purpose of this admiralty claim.
    3. The Crews, Captains and employees of the Defendants who was on board the Ship’s movements during on-going bad weather when the Ship and was grounded at Rennell Island to be made available for statement to be collected from each of them by the claimants, agents, servants or agents.
    4. Full Disclosure of all the following documents and informations from the Vessel Solomon Trader and the owner of the Vessel King Trader Limited herein refer to as the 1st and 2nd Defendants.
    5. The Captains, Crews, agents, Servants and Employees of the Defendants not to leave Solomon Islands Jurisdiction and their passports of the four officers to be surrendered to court until further orders of the court pending investigations and interview instigated by the claimants.
    6. Penal Notice is attached to Orders 1, 2, 3, 4 and 5 to compel the defendants, agents, servants and employees to provide full disclosure to the informations by either by way of interview or warrant.
    7. Interests and Costs pursuant to the Rules 17.74 and 17.75 of the Solomon Islands Courts (Civil Procedure) Rules 2007; and
    8. Any other orders the Court deems fit in the circumstances of this case.
    9. Costs of Ex parte Application be in the cause, otherwise cost of any inter-parte hearing be borne by the respondents jointly and severally.
  4. The need for relief prior to the filing of a substantive case arose from a serious maritime incident involving the MV Solomon Trader running aground and spilling quantities of heavy fuel oil. The learned trial judge described the incident as the “biggest disaster to have occurred to the environment in recent years in this country, a disaster so huge that it warranted the intervention of foreign countries.....”. As a result of this, the judge concluded that it would not be unreasonable to expect litigation to follow.
  5. Various hearings of the application for relief took place and orders were made from time to time dealing with matters not the subject of the appeal. This appeal concerns only relief number four in the application concerning discovery of documents.
  6. At 4 the respondents sought discovery of “the following documents” from The MV Solomon Trader and King Trader Ltd as the owner that vessel. The documents were not, in that urgent interlocutory application, particularised. They were subsequently particularised in an application filed 1 April 2019 returnable on 16 April 2019. The documents are :-
    1. Anchor Position log
    2. Arrival Condition Report
    3. Authority to Issue Bill of Lading
    4. AWT Weather Forecasts
    5. Ballast log
    6. Ballast Water Reporting Form
    7. Barograph (Air Pressure record)
    8. Bridge Note Book
    9. Bridget Memo Noted – Record of Various occurrences recorded I rough
    10. Cargo Hold inspection report – Following inspection at Sea, by crew
    11. Cargo Loading Computer – CPU from the Cargo Control room
    12. Certificate of Compass Adjustment
    13. Check List: Bridge Gear Checklist
    14. Check List: Bridge Gear
    15. Check List: Handing/Taking over watch at Sea
    16. Check List Handing/Taking over watch at Anchor
    17. Checklist: Heavy Weather
    18. Checklist Navigation in heavy weather
    19. Checklist: Vessel not under command
    20. Checklist: Watch-Keeping at Anchor – Duties of O.O.W
    21. Checklist: Preparations for departure checklist
    22. Chief Officer’s hand written work notebook
    23. Chief Engineer’s and Second Engineer’s (original signed version if available) Standing instructions/orders for the engine room
    24. Class NK Survey and/or Audit Status, History and Particulars information service
    25. Clearance of vessel to a foreign port – last port clearance from chine
    26. Correction Table of Draft Fore and Aft
    27. Course Recorder Trace
    28. Crane Wire Running Hours
    29. Crew List – Departure China
    30. Crew List – Arrival Kanggava bay, Rennell Island
    31. Crew Familiarization checklist record (signed version if available)
    32. Daily Noon Reports – Jingjiang, China to Kanggava Bay
    33. Damage Control Booklet – NKK Approved
    34. Damage Control Plan – NKK Approved
    35. Deck Log book (and Supporting pages describe entries to be made and style/format of weather records.
    36. Draught Survey Report – Departure China
    37. VDR Vessel’s Data Recorder
    38. Draught Survey Report – Arrival Rennell Island
    39. Drug and Alcohol Policy
    40. Drug and Alcohol records of last 12 months on board tests
    41. ECDIS Track history/past position record (or screen photo/video of the same if not possible to export for play back
    42. Echo Sound Trace from arrival and anchoring to grounding
    43. Emails – Printed emails messages from vessel to others regarding incident i.e. owners, Flag State, Class, Port Authorities etc.
    44. Email Computer – CPU for email communications
    45. Engine oil consumption details for NCR/MCR, ballast and laden
    46. Engine Log Book (and supporting pages that describe entries to be made
    47. Engine records of work done (Chief and Second Engineer daily work log)
    48. Engine Telegraph Printer Record
    49. Emergency Towing Procedures
    50. Emergency Towing Booklet
    51. Extern Weather Routing Information
    52. Fire Control & Lifesaving Plan – NK Class endorsed
    53. F.O & D.O Tank Condition Departure Jingjiang, China
    54. F.O & D.O Tank Condition Arrival Kanggava Bay, Rennell Island
    55. F.O Delivery notes and sample test report for past 12 months
    56. GMDSS Radio log book
    57. GPS Log book
    58. Hand Written Notes – rough note used to complete cargo and deck log various
    59. Hold Chemical Status – ROB/Consumption
    60. ISM/Company Standing Instruction for keeping a bridge watch at Sea and at Anchor.
    61. ISM/Company standing instruction for keeping an engine room watch at sea and at Anchor
    62. ISM/Company descriptions for all crews.
    63. INMARSAT C – Weather records, from departure Jingjiang until disembark the vessel at grounding
    64. INMARSAT C – Communication record (printed message) between vessels and others
    65. Letter of Protest – Past Three Months
    66. List of Ventilator – Inspection checklist Master/Chief Officer
    67. List of Ventilator – Schematic Plans
    68. Loading/Unloading Sequences Summary Form
    69. Lube Oil Delivery Notes and Sample Test report for past 12 months
    70. Master’s (Original signed version if available) standing orders for navigating and anchor watches
    71. Master’s (Original signed version if available) night order book from departure Jingjiang china to Grounding
    72. Mate’s Receipt
    73. Mineral Ore Export Permit
    74. MF/HF DSC Recd.Msg.File
    75. Navtex Msg.File
    76. Noon To Noon Report file
    77. Notice of Readiness – Last Port of Jingjiang and Rennell Island
    78. Outward Foreign Manifest
    79. Passage Plans from Departure Jingjiang China to Arrival Kanggava Bay, Rennell Islands and for outboard voyage to discharge port
    80. Pilot Card File
    81. Planned Maintenance Records and Job List for Engine Room Machinery in the 6 months prior to (and including) grounding
    82. Planned Maintenance Records and job for engine room machinery in the 6 months prior to (and including) Grounding
    83. Photographs and videos made by the crews during the time at anchor and of incident
    84. Pre-loading Hold (s) Hatches Inspections Report
    85. Pre-Stowage Plan Quarter Master’s Daily Report
    86. Radio Traffic Abstract
    87. Ships Particulars
    88. Deck Sounding Book
    89. Sounding Record – hand written
    90. Speed Distance Table – For the Voyage between Jingjiang to Rennell Island
    91. Statement of facts – last port Jingjiang
    92. Statement of facts for grounding made by Master and other Crews
    93. Statistical Supplement
    94. Stowage plan – Final for last three loadings
    95. Tank Table interpretation
    96. Test Condition for Loading Computer
    97. Tide Tables for China and Rennell Islands
    98. Voyage Data Records Backup and playback software for time of incident
    99. Voyage Memo – List of Previous ports
    100. Voyage Plan – Jingjiang to Kanggava Bay, Rennell Island
    101. Weather Facsimile Reports – Jingjiang until Disembarking the vessel on grounding
    102. Working Chart BA and Local
    103. SIMSA interview reports
    104. Interview reports obtain by other SI Authorities and/or bodies.
  7. The application was heard and the judgment from that hearing appears in a judgment dated 18 April 2019 which appears in the appeal book. In summary that judgment dealt with the more pressing matter of releasing the master and crew of the vessel and securing the documents into safe custody whilst allowing from the crew to leave the Solomon Islands. The applications not then determined by that hearing were adjourned to a date to be fixed.
  8. A further order was made on 7 May 2019. That order primarily dealt with the parties and resulted in the present parties to this appeal being confirmed and identified that the outstanding matter from the original application was the application for disclosure. In particular, in order 5 of the order of 7 May 2019, the court said: - “Outstanding issue for submissions and determination by the court is application for disclosure prior to filing a claim.
  9. Following a hearing on 7th May 2019 a written ruling was published on 6 June 2019 indicating that the application for disclosure was granted. It is against that judgment that this appeal is brought on fourteen grounds. Those grounds are set out in the notice of appeal filed 22nd August 2019 following the grant of leave. The grounds of appeal are:-
    1. His Lordship erred in making the subject order in the absence of a sworn statement setting out the reasons why the documents (or any particular of the documents) should be disclosed, as required by rule 11.24;
    2. His Lordship erred in making the subject order without making a finding that the documents requested to be disclosed were (or any particular of them was) relevant to an issue likely to arise in the proceedings as required by rule 11.26 (c), or alternatively, His Lordship erred in so finding;
    3. His Lordship erred in making the subject order without making a finding that disclosure of the requested documents (or any particular of them) is necessary to decide the proceedings fairly or to save costs as required by rule 11.26 (d), or alternatively, His Lordship erred in so finding;
    4. His Lordship erred in having reference to the possibility of litigation arising out of the subject casualty other than proceedings to which the Appellants and person in possession and control of the documents were likely to be party;
    5. His Lordship erred in finding that the subject documents are needed to inform the Respondents on their intention to sue the Appellants;
    6. His Lordship erred in finding that the documents the subject of the order could not be obtained by the Respondents by other means;
    7. His Lordship erred in finding that the application was not a mere fishing expedition.
    8. His Lordship erred in finding that there was a clear basis for a claim;
    9. His Lordship erred in making the subject order without making any finding that the subject case is exceptional, or alternatively, His Lordship erred in so finding;
    10. His Lordship erred in making findings concerning the nature and effect of the casualty involving the defendant ship giving rise to the application, without any, or any sufficient, evidentiary basis;
    11. His Lordship erred in his findings concerning the nature and effect of the said casualty.
    12. His Lordship erred in finding Bintan Mining SI Limited chartered the defendant ship;
    13. His Lordship erred in finding that the Respondents intended to sue the insurer of the defendant ship;
    14. His Lordship erred in the exercise of his discretion in making the subject order, in circumstances above.
  10. The parties to this appeal agreed that the hearing of the appeal could take place by circulation of papers, after having been given the option of a virtual hearing or a paper hearing, given that the Court of Appeal could not be convened in Honiara in 2020 owing to the global pandemic.
  11. Not all grounds of appeal were pressed by the appellants in their submissions and therefore no further discussion of those particular grounds appears within this judgment. The remaining grounds pressed can be grouped into evidentiary (grounds 1 and 2), necessary (ground 3 and 5), other sources (ground 6), a fishing expedition (ground 7), exceptional circumstances (ground 9) and the exercise of discretion (ground 14).
  12. Whilst other interlocutory relief sought within the original application is governed by Solomon Islands Courts (Civil Procedure) Rule 2007 (CPR) disclosure is dealt with under Chapter 11. In Chapter 11 it is provided inter alia that:-
  13. Somewhat irregularly this Court was obliged to resort to submissions of the respondents in the court below to find out what material had been relied upon by that court when dealing with the application for disclosure. That information would normally be found in an early recital within the judgment, such that the need to resort to other documents to ascertain the material relied upon by the trial judge to found a decision falls away. That custom, of briefly reciting the material relied upon, or read into the record, was not followed here. Perhaps it should have been.
  14. It is, nevertheless, the case, confirmed again within submissions, that the material relied upon by the respondents was the first application filed 1 April 2019, the second application filed 7 May 2019 and the sworn statements of Peter Teddy filed 28 March 2019, Humphrey Talu filed the same day and Whitlam Togamae filed 7 May 2019. The first application was the application for discovery before proceedings as foreshadowed in the application filed 28 March 2019. The second application dealt with parties to the proceedings and is not relevant to this appeal.
  15. Peter Teddy in his statement sets out some background to the grounding of the vessel Solomon Trader and exhibits the charter agreement between respondent corporation and the 1st appellant. At paragraph 13 of his statement he asserts his belief that the owners of the vessel, the 1st appellant and their insurers (then another party since removed) may seek to deny liability under the charter agreement (presumably for the damaged which followed the grounding of the vessel although that is not stated).
  16. Then, without any earlier reference to documents appearing in his statement, at paragraph 14 he says:-
  17. Humphrey Talu in his statement gives a fuller picture of the parties and their respective roles but essentially gives the same evidence as Teddy but in more detail. He refers to the documents set out in “paragraph A” numbered 1 to 103 and seeks disclosure ‘for the purpose of the [respondents] admiralty claim and investigations. There is no paragraph A within his statement or any annexure thereto. There is a paragraph A which appears in the application for discovery but that document had not been filed at the time of his statement but was filed a few days later on 1 April. In that paragraph A there are 104 documents listed but the final document is interviews which was perhaps omitted from his list because those interview records would not come from the appellants but other authorities. Suffice to say that there is an unexplained difference of one in the number of documents sought.
  18. He further states that “these documents must be made available to the [respondents] because it is required to access what happened and who is responsible for the grounding of the vessel. I verily believe that these or some of these documents are believed to be with the ship owner or may have been removed by the ship owner, these documents are relevance for the purpose of accessing what happened to the ship and who should be held responsible for the grounding of the ship and the HFO leakage”. His statement continues with paragraphs similar to Teddy denying liability and that the documents are required for ‘assessment’.
  19. Whitlam Togamae in his sworn statement, which only appears in the supplementary appeal book, had a little more to say about the documents. Beginning at paragraph 18 of his statement he says:-

18. BMSI, King Trader and the ship are likely to be parties to proceedings relating to the grounding of the ship in Lavagu Bay (Kanggave Bay), Rennell Island. The documents which are sought in the application are relevant to issues which are (sic) likely to arise in those proceedings, namely:

  1. the state and seaworthiness of the ship; and
  2. the acts or omissions of the master and crew of the ship.

19. The documents which are sought will assist BMSI in determining whether:

  1. it has a claim against King Trader and/or the ship and if so, pleading and prosecuting the same;
  2. it has a defence to the claims asserted against it by others and if so, pleading and prosecuting the same; and
  1. it should join King Trader and/or the ship to any proceedings commenced against it and if so, pleading and prosecuting the same.

20. Disclosure before the proceedings have started:

  1. is necessary to decide the proceedings fairly, in that it will enable BMSI to properly plead and prosecute its claim(s) and defence(s);
  2. will save costs and delays, including to third parties such as people asserting customary ownership of the seas, reefs and land in the area of Lavagu Bay (Kanggave Bay) Rennell Island and the government;
  1. in this instance, is consistent with the overriding objectives of the Solomon Islands Courts (Civil Procedure) Rules 2007
  1. In his penultimate paragraph he seeks an order that BMSI should be joined as 3rd claimant in the proceedings. He had previously explained that BMSII stands for Bintan Mining SI Limited which is a wholly owned subsidiary of Bintan Mining Corporation. An order was made on 7 May 2019 removing an earlier party in these proceedings and replacing it with BMSI, so although Mr Togamae asked from them to be joined a 3rd claimant they were joined as 1st claimant instead.
  2. No notice to cross-examine was given in respect of any of the authors of the statements. This was the extent of the evidence presented in support of the application for discovery. That leaves the question whether there is sufficient material contained therein to successfully maintain the application for pre-action discovery. To be successful an applicant must show that the requirements set out in Rule 11.23 to 11.26 (set out above) are met. There is nothing which appears in the judgment suggesting that the trial judge considered each of the requirements in those rules, rather that he considered what this Court said in Lilo v Kennedy [2014] SBCA 7.
  3. In Lilo v Kennedy this Court considered a situation where the trial judge had pre-emptively made an order for disclosure before hearing the application. When the application was not before him, but an application to strike out the disclosure application as vexatious, he went ahead, without hearings substantive submissions, to dismiss the claim for strike out and made the substantive order without any hearing. That order was set aside. Whilst correct as to what it addresses, it is hardly a good precedent to follow as what it said about the nature and extent of pre action disclosure is limited.
  4. The trial judge appears to have summarised Lilo v Kennedy as setting out four test which need to be satisfied before the discretion to grant disclosure and that those tests are that there is no other means of obtaining the documents, would disclosure impose an unreasonable burden, are the documents well defined and is there a clear basis for a claim.
  5. Those tests must be compared with the actual tests to be applied as set out in the Rules. Each of the test that the trial judge found from his reading of Lilo may well be a part of those relevant test, but the starting point must be the test themselves, i.e. benefits of disclosure, disadvantages of disclosure, financial means of subject of the order. Then after considering those matters the court should not proceed to order discovery unless the person subject to the discovery order has had an opportunity to be heard and is likely to be a party to proceedings, the documents are relevant to an issue likely to be an issue in the proceedings and early disclosure is necessary to decide the proceedings fairly or to save costs.
  6. It is at this point that we must conclude that the learned judge erred in determining the application by failing to apply the correct test. Rather he relied upon a summary of what was required in the circumstances presented in Lilo. That may have resulted in the correct answer but, if so, that would only have been fortuitous. We therefore set aside the decision of the trial judge and continue to determine what, if any, order should be made in lieu thereof.
  7. We have discussed the evidence available to the trial judge and from that evidence we can identify support for the notion that the documents, or some of them, may be necessary to decide proceedings fairly or to save costs. It is the case that the trial judge came to that conclusion when he determined that the was a ‘clear basis for the claim’ arising from’ the relationship between claimants and defendants under a Charter Party Agreement’.
  8. We note that the parties to the application are likely to be parties to subsequent action, as either being sued by the respondents or joined by them in an action brought by others.
  9. The documents, in our view, cannot be obtained in any other way. The relevant authorities may have taken copies or photographs of some or all of the documents, but those authorities are under no obligation to the respondents. In any event the documents are those of the appellants their servants or agents and should be disclosed by them.
  10. It seems to this Court that the documents sought are such that would be expected to arise in the course of a charter. The parties to this application are parties to that charter. The respondents seek no more than material relevant to the proper carrying out of the charter.
  11. A vessel such as this at sea is regulated by many and various rules from various national and international bodies. Compliance with those rules and regulations will, no doubt, include the keeping of records.
  12. It is wrong to suggest, in those circumstances, that the respondent embarked upon a fishing expedition. The respondents seek only those documents relevant to the carrying out of the charter for which they paid. Those same respondents may well be pursued themselves for the damage which arose from the carrying out of that same charter. They are entitled to investigate prior to commencing proceedings, how the charter was carried out and whether the obligations on the vessel, master and crew were fulfilled.
  13. There would be no such finding based on the evidence of Teddy or Talu. It is the evidence of Togamae that satisfies the requirements in our view sufficient to persuade this Court that its discretion in making a pre actin order for disclosure is the proper order to make.
  14. Based on that evidence, that the documents sought are relevant and for a particular purpose, consideration was given as to the likely benefits and the likely disadvantages of disclosure. We are satisfied that the likely benefits outweigh the likely disadvantages, indeed there is nothing within the material suggesting the same and equally nothing to suggest that the appellants lack sufficient financial resources to comply.
  15. The appellants have had the opportunity to be heard, and as discussed earlier the appellants are likely to be parties to the proceedings. We further find that it is necessary to order pre-trial disclosure to decide the proceedings fairly or to save costs. We find the notion of ‘deciding proceedings fairly’ Rule 11.26(d), when no such proceedings have begun, difficult to apply but we find that this could be equally applicable to the making of the decision to bring proceedings and in any event can rely on the alternative ‘to save costs’ as correct usage of the material disclosed will inform the respondents of what proceedings to instigate.
  16. There is no reference in the evidence to particular items specified in the list of material sought on disclosure and their particular relevance. Given how the evidence was presented, with a substantial degree of cut and paste taking place as between statements, we suspect that the list was taken from another source and is most likely to contain the items required to be kept by the master and crew of a vessel under charter. The appellants are however, entitled to question item by item. That opportunity was available to them at trial, but they chose not to avail themselves of it. For that reason, we are satisfied that an order requiring disclosure of all the documents sought should be made. We are not prepared to adopt the approach adopted by the appellants that some of the material is clearly irrelevant (suggesting that the remaining material may be relevant) as we lack that particular expertise and the inclination to speculate.
  17. The appeal is dismissed. The order of the High Court for disclosure of the 103 documents is upheld. Should there be practical issues over disclosure the parties should approach the High Court for further directions on the mater. Costs of and incidental to this appeal are ordered to be paid by the appellants, to be agreed or taxed.

Goldsbrough P
Lunabek JA
Member
Gavara-Nanu JA
Member

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