The Owners of the Mv Angara & Anor V. Chrismatel Shipping Company Limited (2001)

LawGlobal-Hub Lead Judgment Report

PIUS OLAYIWOLA ADEREMI, J.C.A.

 In the court below (Federal High Court) presided over by Okeke J. the plaintiff (hereinafter referred to as respondent/cross-appellant) claimed against the defendants (hereinafter referred to as appellant) jointly and severally the sum $258, 850.58 being expenses incurred by the defendants on the account of the plaintiff as agents of the 1st and 3rd defendants in respect of Harbour Dues, Ship Dues, Stevedoring Charges as reflected in N.P.A. provisional bills as at 19th of November, 1998.

The background facts of this case are as follows; the second defendant vessel sailed into the Nigerian territorial waters with a consignment of cement. It was berthed at Apapa Port. The plaintiff/respondent-cross-appellant acted as agent for the vessel as well as 1st and 3rd defendants. The cross-appellant performed all the necessary appurtenant to the duties of an agent by procuring the ship entry notice, getting the vessel registered with the Nigerian Ports Authority and providing for the security of the vessel and, the members of the crew while in Nigeria. The 2nd defendant/appellant finally finished the discharge of the goods laden on board in February 1999.

The Nigerian Ports Authority called for the settlement of the provisional and final bills sent to the appellant. The cross-appellant sequel to the refusal to pay, brought an application ex-parte for the arrest and detention of the ship. The attempt to arrest the second appellant was foiled, but the appellants provided security of US $500,000 to the respondent/cross-appellant.

The appellants, by their application dated 12th March, 1999 moved the court below for an order striking out their names (1st and 2nd defendants/appellants) as parties and dismiss the claim on the grounds that;
(i) Neither MV Angara nor her owners are proper parties hereto.
(ii) The owners of the vessel MV Angara are not liable in personam for the claims therein.
(iii) No claim in rem can be validly constituted against the vessel MV Angara.

In a considered ruling delivered on 18th October, 1999, the learned trial Judge sustained the grounds upon which the motion was predicated and went on to say that, in law, he was bound to grant the application but concluded that he would have to defer the order to be made for reason of the fact that the 3rd defendant (S.M. Shipping Limited) who had not been served as at then might be served in future. Being dissatisfied with the said ruling, the appellants sought and obtained leave to appeal against the said ruling. The notice of appeal carries just one ground. And distilled from the ground is one issue for determination which is in the following terms;
“Whether having upheld the grounds argued for striking out the appellants, and the incompetence of action against them, the court can defer the proper order indefinitely and on the basis of a speculative and uncertain event?”

The cross-appellant as respondent to the appeal, formulated four questions for determination and they are as follows:
1. Whether the plaintiff has in its pleadings alleged that it acted as agent for the 1st and 3rd defendants or for the 3rd defendants alone.
2. If the plaintiff/respondent has averred in its pleadings that it acted as agent for the 1st and 3rd defendants, whether the trial Judge can make a conclusive findings of fact on the issue without having evidence on the merit.
3. whether the facts pleaded by the plaintiff/respondent in the statement of claim are such that they disclose a reasonable cause of action against the first and second defendants/appellants.
4. whether the Judge speculated on the evidence having regard to the plaintiff’s statement of claim and charter party between the 1st and 3rd defendants and counter-affidavit.

The cross/appellant sought and obtained leave of court for an order extending the time to cross-appeal against the said ruling of 18th October, 1999. The notice of cross-appeal carries with it three grounds of appeal. Five issues were befitted from the three grounds of appeal and set out on the brief of the cross-appellant, they are:
(1) whether the question whether or not the plaintiff has authority to act as agent for the defendants was an issue which goes to the merit of the substantive suit in view of the averments in paragraphs 2-4 of the statement of claim.
2. If the above question is answered in the affirmative whether the learned trial Judge of the lower court can properly express a conclusive opinion on the issue without first having evidence on the merit.
3. whether or not the plaintiff’s action as constituted can be maintained against the 1st and 2nd defendants in view of the provisions of Section 16(4) of the Admiralty Jurisdiction Decree No.59 of 1991.
4. when there is a question as to who is liable to pay the berth age and anchorage due who is the proper defendant to such an action having regard to the provision of Section 81 and 121 of the Ports Act Cap 361.

For a clear focus, I shall start the consideration of the appeal and cross-appeal by saying that the substratum of the appeal is the complaint against that part of the judgment where the learned trial Judge deferred the dismissal of the case against the 1st and 2nd defendants/appellants on ground that the 3rd defendant who had not been served with the processes and who might be served in the future, according to it, had the authority of the 1st defendant to appoint the plaintiff respondent as agent of 2nd defendant in Nigeria. On the other hand, through its cross-appeal, the cross-appellant has expressed its dissatisfaction against that part of the decision where the trial Judge had said that he would have dismissed the action against the 1st and 2nd defendants/appellants if the plaintiff/cross-appellant had sued them (the 1st and 2nd defendants/appellants) alone. The learned trial Judge in dismissing the application brought by the 1st and 2nd defendants/appellants to have their names struck out on the grounds set out above said inter alia:

“In the determination of this application, one must bear in mind the true position of the law as provided for in Section 5(4) of the Admiralty Jurisdiction Decree No. 59 of 1991. Generally, a claim such as that of the plaintiff/respondent, will be against the owner of the vessel or a demise charterer.
The plaintiff/respondent has introduced a new element which is that the 3rd defendant appointed it the sole shipping agent of the vessel M.V. “ANGARA” discharging at Lagos, Nigeria.
If the plaintiff/respondent had commenced the action against the 1st and 2nd defendants/applicants the 1st and 2nd defendants/applicants only, I would have easily dismissed same on the true state of the law. The affidavit and counter-affidavit filed in the present application show that the plaintiff/respondent claims it as an agent of the vessel M.V. “ANGARA” appointed by the 3rd defendant.
Where did the 3rd defendant derive the power to appoint an agent for the 2nd defendant in Nigeria? It is my humble view that the dispute as to the appropriateness or otherwise of the plaintiff/respondent’s so called appointment cannot be determined at this interlocutory stage. That is a matter to be determined in the substantive suit. See A.C.B. Ltd v. Awogboro (1996) 3 NWLR (Pt.437) 383. Should I strike out the names of the 1st and 2nd defendants/applicants and discharge the security provided at this stage, what would be the fate of the plaintiff/respondent’s claim when the 3rd defendant appears and claims that it has the authority of the 1st defendant to appoint the plaintiff/respondent as agent of the 2nd defendant in Nigeria. The plaintiff/respondent would be left without any remedy. In my view, that would result in great injustice to the plaintiff/respondent.”

I have cast a second look at the only issue raised by the appellants in their brief and the four issues identified by the cross/appellant as respondent to the appeal. First, I wish to say that the issues identified by the respondent/cross-appellant ran against the well established principle that issues for determination must not be more than the grounds of appeal formulated. see Oyekan v. Akinrinwa (1996) 7 NWLR (Pt.459) 128. Again, the cross-appeal carries three grounds of appeal and whereas the cross-appellant has formulated five issues for determination. What I have said above of the issues raised by the respondent in reply to the substantive appeal is true of the issues raised in the cross-appeal. It is important that Counsel are always mindful of the principle regulating the formulations of issues from the grounds of appeal filed.

Taking all the issues by both sides in the appeal and cross-appeal together it seems to me that they can be summarised into these two issues:-
(1) whether from the facts pleaded by the plaintiff/cross-appellant in the statement of claim it can be said that a reasonable cause of action against the 1st and 2nd defendants/appellants has been disclosed.
(2) whether having regard to the totality of the case presented before him, the trial Judge was right in the conclusion he reached.

In answering issue 1 above, I wish to start by saying that from the nature of the claim which is primarily directed at the ship, res. it can be correctly described as an admiralty action in rem. The plaintiff/cross-appellant made a claim for the services rendered on the 2nd defendant/appellant. For reason of failure to pay for the services an application ex-parte was brought to arrest the ship – 2nd appellant.  Thus, a maritime lien was brought against the res to travel with it into whosoever possession the res comes. The action of this type which is one in rem in maritime claims affords an opportunity for the plaintiff to obtain a pre-trial and pre-judgment adequate security for the satisfaction of the claims the plaintiff has against the owners of the ships in the event of a final judgment being entered in its favour. The purpose of obtaining an order for the arrest of the ship or res is to make the defendant put up a bail or provide, in advance of the judgment, adequate funds for security compliance with any judgment that may be eventually entered against it. See The Banco (1971) Probate 137 at 151 and Halsbury’s Law of England 4th Edition Volume 1 Paragraph 310. Then what are the facts pleaded by the plaintiff/cross-appellant? The relevant paragraphs of the statement of claim are, 2, 3, 4, 5, 6, 7, 9, 10 and 11; and they are as follows:-
Para 2

“The first defendants are the owners of the ocean going vessel M. V. Angara and were the owners of the aforesaid vessel at the time the events that have given rise to this suit occurred.

Para 3

“The 3rd defendants were the time charterers of the aforesaid vessel M.V. Angara at the time the events that have given rise to this suit arose and are a company incorporated under the laws of the United Kingdom and carries on business at its principal place at No. 72 New Band Street, London WIY 9DD United Kingdom.

Para 4

“The plaintiff in this suit had been the agent of 1st and 3rd defendants contracted to procure all necessary approvals and berth the vessel M.V. Angara.

Para 5

“The plaintiff avers that the agreed agency fees for services rendered by the plaintiff is $10,000.00.

Para 6

“The plaintiff further avers that on the basis of the agency agreement the plaintiff procured the services of security outfit to provide security for the vessel.

Para 7

“The plaintiff states that as agents of the vessel M. V. Angara provisions were provided for the vessel and crew members upon arrival on Nigerian Territorial Waters.

Para 9

“The plaintiff further states that in pursuance of the agency the plaintiff procured the necessary approvals, entry notice and security for the vessel M. V. Angara at substantial cost.

Para 10

“The plaintiff in pursuance of the afore-mentioned agency successfully berthed the vessel and discharged the cargo laden on board the aforesaid vessel.

Para 11

“The plaintiff avers that prior to discharging the cargo laden on board the vessel port charges and dues were incurred on the plaintiff’s account.

It is beyond argument, going by paragraph 4 quoted above that the case of the plaintiff/cross-appellant from its pleadings is that the 1st defendant/appellant and the 3rd defendant:- The owners of the M.V. Angara and G. M. Shipping Ltd respectively – appointed it (plaintiff/cross-appellant) as their agent for purpose of providing all necessary approvals and berth the vessel M.V. Angara – the 2nd defendant/appellant. In paragraph 2 of the said statement of claim, the plaintiff/cross-appellant averred that the 1st defendant/appellant are the owner of M. V. Angara – the 2nd defendant/appellant. The plaintiff/cross-appellant had in its briefs of argument submitted that by virtue of section 81 of the Ports Act Cap 361 the owners of a vessel are liable to pay for the berthage and anchorage dues. Subsection (1)(a) of section 81 which is the relevant law provides:
“The following persons shall be liable to pay ships’ dues levied on a ship under paragraph (a) of section 80 of the Act:-
(a) the master or owner.
I cannot agree more with the submission of the respondent/cross-appellant that under the Ports Act and going by its pleading the 1st defendant/appellant held out as the owner of the ship, the 1st appellant is the party to be held liable to pay for the berthage, the anchorage and all other services rendered to the 2nd appellant if the averment in paragraph 2 of the statement of claim is proved. But for now, in the face of the pleadings and having regard to the state of the law it is indisputable that the plaintiff/cross-appellant has a cause of action against the 1st and 2nd appellants and because it has gone ahead to aver that the 1st appellant and the 3rd defendant contracted it to procure all the necessary approvals and berth of the 2nd appellant; the three -1st and 2nd appellants and 3rd defendant (S.M. Shipping Ltd.) are necessary parties to this case as the plaintiff/cross-appellant would seem to have a cause of action against the 3rd defendant as well based on the same set of facts. The cross-appellant as plaintiff in the court below, based on the facts pleaded was right, in law, to have taken the action against the three. It is by bringing the three together into the arena of litigation that interest of justice which demands, inter alia, that all issues between the parties should be determined once and for all so as to avoid the multiplicity of proceedings:- see Odadhe v. Okujeni (1973) 11, S. C. 343 and Oduola & Ors v. Coker & Ors (1981) 5 S.C. 197. The learned trial Judge was therefore in error to have held that if the plaintiff/respondent/ cross-appellant had commenced the action against the 1st and 2nd defendants/appellants only, he would have easily dismissed the action against them. It is manifest, from the pleadings, that the plaintiff/cross-appellant has a cause of action against them. And to justifiably dismiss the case against them a full scale trial must have been allowed and an order or judgment of the court, if it is one granting the reliefs sought or one dismissing them must reflect a thorough perception and evaluation of the total evidence led.

I therefore answer issue one as summarised by me, above, in the affirmative. The only issue formulated by the appellants, in my respectful view, will not arise having regard to the state of the pleadings which I have reviewed above. Issues one and three in the brief of the cross-appellant as respondent to the appeal, are answered in the affirmative, as I have observed, it was erroneous for the trial Judge to have made conclusive findings, as he did without allowing the case to proceed to trial, I therefore answer issue two in the negative, and by the same token I answer issue two in the cross-appellant’s brief in the negative. Of course, issue one in the cross-appellants brief based on what I have been saying, is answered in the affirmative. In answering issue three on the cross-appellant’s brief I shall first, set out the provisions of Section 16 (4) of the Admiralty Jurisdiction Decree No. 59 of 1991 which states;
“a person who does anything or carries out any duty under the provisions of this Decree or under the provisions of any law in force in Nigeria in respect of any ship in the territorial waters of Nigeria shall by doing that thing or carrying out that duty constitute himself the agent of the ship.”
That issue calls for the interpretation of the provision of a statute. The general rule for construing a statute has been stated by this court and the Supreme Court through plethora of cases. The rule is this, where the words of a statute are clear and unambiguous the court is duty bound to give effect to their literal meaning. It is only where the literal meaning may result in ambiguity or injustice that the court may wish to seek internal aid with the frame work of the statute itself or external aid from statutes in pari materia to enable it resolve ambiguity or avoid dispensing injustice. Ordinarily, by virtue of the afore-mentioned provisions of Section 16(4) of the Admiralty Jurisdiction Decree No. 59 of 1991 the plaintiff cross-appellant for the duties it carried out on the 2nd defendant/appellant it can safely be described as the agent of the 2nd appellant, the ship. By that construction, the 1st appellant would therefore seem not to be liable for anything done on and for the 2nd appellant. This certainly will negate the rationale for an action in rem which has been described as primarily a proceeding against the ship or the res by way of an arrest and is indirectly a process for compelling the appearance of the owner of the ship to defend his property thereby impleading him to answer to the judgment to the extent of his interest in the property. An action in rem being procedural, the main purpose of it is to secure the personal appearance of the defendant, the ship or the res to arrest the ship within jurisdiction.
The substratum being the lien resulting from the personal liability of the owner of the ship see (1) Chief Registrar High Court, Lagos State & Anor v. Vamos Navigations Ltd (1976) 1 All N.L.R. (Pt.1) 11, (2) Ming Ren Shipping v. Amajemeso Shipping Agencies Ltd (1979) 1 NSC 462 at 466/467, (3) The Utopia (1893) A.C. 492 at 499 and (4) Halsbury’s Laws of England 4th Edition Volume 1 Para 310. As I have said, the literal meaning of section 16(4) will work injustice. That should not be. The marginal notes to section 16 reads: “Liability for principal and agent.” It seems to me that the marginal notes have been inserted in furtherance of the rationale for action in rem as I have stated it to be supra. It is an internal aid. Can the notes be made use of? My answer is in the affirmative and I find support for this answer in the dictum of ESO J.S.C. when in Alegbe Speaker Bendel, State House of Assembly v. Oloyo (1983) 2 S.C. 35, he said at page 193 and I quote him:
“Though in modern times marginal notes did not generally afford legitimate aid to the construction of a statute, at least it is permissible to consider the general purpose of a section and the mischief at which it is aimed with the marginal notes in mind. (See Stephens v. Cuckfield R.D.C. (1960) 2 Q.B. 373 at 383).
The mischief aimed at from the marginal notes is the avoidance of a situation where the principal will always escape liability. Consequently, I answer issue three in the cross-appellant’s brief in the affirmative by saying that the plaintiff/cross-appellant can maintain an action against the 1st and 2nd appellants. The answer to issue four on the cross-appellant’s brief admits of no argument that properly construing the provision of Sections 81 and 121 of the Ports Act Cap 361, the proper defendant is the master or the owner. In concluding his ruling, the learned trial Judge reasoned that if he were to dismiss the action as against the 1st and 2nd appellants, the plaintiff/cross-appellants, would have been left without any remedy; in his view, that would be injustice. He was right and I therefore answer the summarised issue two in the affirmative.

In the final result from all I have been saying, the appeal, in my judgment, is unmeritorious. And it is accordingly dismissed. The cross-appeal complaining against that part of the trial Judge’s pronouncement that he would have dismissed the entire suit if the 1st and 2nd appellants were the only defendants sued succeeds. That portion of the ruling which I adjudge to be erroneous is hereby expunged from the body of the main ruling delivered on the 18th of October, 1999.

The plaintiff/cross-appellant is entitled to cost which I assess in its favour at N5,000.00.

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Other Citations: (2001)LCN/0951(CA)