The “caroline Maersk” Sister Vessel To Mv “christian Maersk” V. Nokoy Investment Limited (2002)

LAWGLOBAL HUB Lead Judgment Report

E. O. AYOOLA JSC

This is an appeal from the decision of the Court of Appeal (Oguntade, Guladima and Sanusi, JJ.C.A) delivered on 10th April, 2000 affirming the decision of the Federal High Court whereby judgment was entered for the plaintiff, Nokoy Investment Ltd. Its claim against the three defendants was as follows:

“1. Certificates/Invoice value of the 1202 boxes of frozen shrimp USD$ 71,516.50

2. Further, or in the alternative, the plaintiff claims at the rate of £100.00 (One hundred pounds sterling) lawful money of the United Kingdom” for each of the 1202 packages of shrimp………£120,200.00
3. Further, or in the alternative, the plaintiff relies on Bill of lading No. LOSE 09233 to claim the value of the net weight of 24,040 kgs, as against the gross weight of 27,040 kgs, at the rate of US$20.00 (Twenty U. S. Dollars) per kilo……US$480,800.00
4. Damages for delayed delivery, spoilage, deterioration of cargo, non acceptance of the aforesaid boxes by the consignee and the Spanish Exterior Trade Inspection Center as well as opportunity and embarrassment caused to the plaintiff by the defendant…… US$50,000.00.
5. Interest at the rate of 20% per annum until judgment and thereafter at the rate of 4%”

The respondent (referred to in this judgment as “the plaintiff’) a registered Nigerian company carrying on business of exporting of sea foods, entered into an agreement with the Maersk Nigeria Ltd., the 3rd defendant, to ship 1,202 cartons of frozen Atlantic gold shrimps valued at US$71,516.50 in a vessel called Christian Maersk, owned by the 2nd defendant from Lagos Port to Aigeciras Port in Spain. The consignee of the shrimps was Tako Fish Corporation, Panama. The shrimps were of good consumable quality when they were shipped from Lagos. They were sealed in a container under acceptable temperature of 180c/200c. The goods were carried under a bill of lading issued in Lagos. The Spanish Health Authority issued two reports on the condition of the shrimps. In the first, issued on 14th February, 1994, it was stated that the shrimps were “not suitable in the first inspection due to abnormal odor, unsatisfactory appearance and high volatile vitrogen.” In the second, issued on 4th March, 1994, it was stated: “Not suitable (second inspection) due to abnormal odor, unsatisfactory appearance and melanoies.”

It was common ground that the shrimps became bad. What was in dispute was when the shrimps deteriorated. The plaintiff claimed that it was during the period of carriage by sea, while the defendants asserted that the shrimps deteriorated after their arrival in Spain and because by the nature of the shrimps they should have been collected within 2 days but were not collected more than 30 days after arrival. The trial Chief Judge, Belgore, CJ, preferred the plaintiff’s version and found that the defendants have failed to discharge the burden on them of proving that the cargo had arrived in good condition. After thus disposing of the main issue of fact essential to the liability of the carrier, the learned Chief Judge turned to questions of law which were essentially on the question of quantum of compensation, which he resolved in favour of the plaintiff. In the result, he entered judgment against the defendants for the rest of the claim after rejecting the 3rd and 4th heads of claim. He dismissed the defendants’ counter-claim for the cost of repatriation of the cargo back to Nigeria and return of the container to the defendants.

The defendants appealed to the Court of Appeal which dismissed their appeal and confirmed the decision of the Federal High Court. This appeal is from the decision of the Court of Appeal.

The broad issues which arise from this appeal concern the quantum of damages awarded; the nature of the liability of the carrier; and, the circumstances in which the 3rd defendant, an agent of the carriers, could be liable for the acts or omission of the ship. In regard to the first question the defendant put their case in several ways which I summarise thus:

(i) Whereas, the Federal High Court had awarded £120,200 as an alternative to an award of US$71,516.50 made in favour of the plaintiff, the court below awarded the former in addition to the latter which was the invoice value of the cargo. This was wrong because the plaintiff was not entitled to a further award in the absence of a cross-appeal by the plaintiff. Furthermore, the award of both sums, being double compensation, was erroneous.

(ii) The Carriage of Goods by Sea Act (Cap 44: LFN 1990) contains the law and the Hague Rules applicable to the contract of carriage between the parties, whereas the Federal High Court and the court below had erroneously applied the version of’ the Hague Rules not adopted by the Act.

(iii) On the footing that the applicable law was the Carriage of Goods by Sea Act the liability of the carrier was limited to N200 per package in accordance with the provisions of Article IV Rule 5 of the Hague Rules as adopted by that Act in the absence of evidence that the parties had contracted out of its provisions pursuant to paragraph 3 of Rule 5.

(iv) The limitation of damages to £100 per package provided for in the Carriage of Goods by Sea Act should not have been interpreted as meaning gold value of £100 sterling but as meaning, simpliciter, what it says, £100 flow equivalent to N200.

In regard to the broad question of the liability of the defendants, the three contentions pressed upon this court by counsel for the defendants were: first, that the liability of the carrier was not strict and the plaintiff must, but did not, establish negligence against the carrier, that is to say, against the 2nd defendant; secondly, that the trial court misconceived the evidence led in support of the defendants’ case; and, thirdly, that the 3rd defendant being the agent of the 1st and 2nd defendants should not have been held liable as there was neither evidence nor finding that the damage occurred in Nigeria, whereas by virtue of section 16 (3) of the Admiralty Jurisdiction Act the liability of an agent of the ship was limited to an act or omission done or failed to be done in Nigeria.

It is expedient to dispose of the question of liability first. The nature of the liability of the carrier determines, to some extent, apart from the general burden of proof on the plaintiff, the particular burden of proof on the carrier. It is clear from the judgment of Belgore, CJ, that he did not attempt to categorise the nature of the liability of the carrier. He was content to apply principles when he said:

“The case of Ogugua v. Armels Transport Ltd cited by the plaintiff reinstated (sic: restated?) the principle that the Plaintiff needs not specifically plead negligence once it has proved that the defendant failed to deliver the quality or quantity of the cargoes he undertook to deliver or did not deliver them at all. It is for the defendant to satisfy the court the reason for what he delivered or what was not delivered and in this case the defendant has failed to do so.”