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Petitioner: Q.B.E. INSURANCE LIMITED VS Respondent: THE TRUSTEES OF THE PORT OF KARACHI through JUDGMENT
Court Name: Sindh High Court Judge(s): Syed Haider Ali Pirzada, Muhammad Aslam Arain Title:Q.B.E. INSURANCE LIMITED vs THE TRUSTEES OF THE PORT OF KARACHI through
JUDGMENT
Reported As: 1992 CLC 804 Result: Appeal dismissed Judgment JUDGMENT ' SYED HAIDER ALI PIRZADA, J.---This is an appeal under the Law Reforms Ordinance filed against the Judgment and Decree passed on 14-7-1975 by the learned Single Judge in Suit No,282 of 1968 dismissing the Suit as the plaintiff failed to discharge the burden of proving negligence on the part of the first respondent. ' The facts leading to the filing of the above appeal may shortly be stated as follows:- ' Messrs Amin Sales Ltd., imported a consignment of 470 packages, consisting of 250 rolls of jute mattings, 216 rolls of jute carpets and 4 bales of samples jute carpets and jute cuttings (hereinafter referred to as "consignment") from Chittagong. The consignment was shipped from Chittagong on board the vessel S.S. "Ocean Endurance" belonging to second respondent under Bills of Lading Nos.CTG-322 to 328 to be delivered to the consignees, namely, Messrs Amin Sales Ltd. The consignment was insured with the plaintiffs, M/s. Queen Land Insurance Co. Ltd. Under seven Marine Insurance Policies Nos.127M/AA/QEP/30035 to 127 M/AA/QEP/30041 for a total sum of Rs,3,03,785. ' The said vessel arrived at Karachi Port on 2-3-1968 and discharged the consignment on the same day into the custody of first respondent except that 55 rolls of carpet had been shown damaged while in the custody of second respondent to the extent of 5% as per Tally Sheets jointly prepared by the respondents copies of which were made available to the original plaintiffs by the second respondent, which after being so discharged was deposited in the open outside shed No,3 at Juna Bunder. The fire broke out in or about that shed No, 3 the same day i.e. On 2-3-1968.
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' It is alleged in the plaint that the said fire was not detected in time by first respondent and engulfed the huge cargo stored in and about the said shed, and destroyed large quantities thereof including the consignment in the suit. It is further alleged that it was only after the fire had become violent and uncontrolable that the first respondent called in the fire brigade to extinguish it. The fire-brigade had to fight for several hours spraying large quantities of water over the burning cargo before succeeding in overcoming the fire. The consignment was badly damaged by the said fire and water used by the fire-brigade in its operation. The original plaintiffs on receipt of information regarding the said fire took steps for the survey of the consignment in suit jointly with the respondents after completion of the necessary Customs and Port Trust formalities. The original plaintiffs appointed M/s. J. Lobo and Moin & Co. And second respondent appointed M/s.. G.B. Poffs Co. Ltd, surveyors to conduct joint survey of the consignment in suit. M/s. Amin Sales Ltd. Suffered a loss of Rs,3,03,785. ' The original plaintiffs in discharge of their obligations under the said policies paid Rs,3,03,785 to M/s. Amin Sales Ltd., Karachi under a letter of subrogation under section 135-A of the Transfer of Property Act to all the rights and remedies of the insurers in respect of the consignment in suit and took the interest of the insured in whatever had remained as salvage. The original plaintiffs auctioned the salvage to higher bidder for Rs,58,000. The original plaintiffs claimed Rs,2,20,980 on the basis of C&F value out of which Rs,4,675 represented the 5% damage shown to the 55 rolls of carpet which had taken place while in the custody and due to negligence of second respondent and Rs,2,16,305 represented the damage on account of said fire. According to the original plaintiffs, loss occurred on the fault of first respondent in open shed and in not taking reasonable care of the same. The first respondent also aggravated the damage by not taking effective and speedy steps to put out the, fire and did not take steps to keep it from spreading. In those circumstances the original plaintiffs claimed Rs,2,25,442.10 from the respondents jointly and severally. ' The fast respondent/defendant No,1 filed written statement contending that the consignment in suit was stored in a proper place in the covered umbrella shed at Juna Bunder with due care and caution. The first respondent had taken reasonable care of the consignment in suit. The fire anddamage were caused not on account of any lack of care or diligence or by any negligence on the part of first respondent or its servants but on account of spontaneous combustion. All possible steps to put out the fire were taken. ' The second respondent filed written statement contending that the consignment was not in good order and condition at the time of shipment. The second respondent denied that 55 rolls were damaged to the extent of 5% while in their custody. The second respondent contended that the original plaintiffs were not entitled to any relief against them. ' On the pleadings of the parties following issues were framed:- (1) Whether the defendant No,1 in the ordinarily course of their business and in their capacity as Statutory Bailees took proper care of the goods in question? (2) Whether the defendants No,1 took appropriate and timely steps and carried out their obligations, responsibilities and/or duties properly and effectively. If yes, what is its effect? (3) Whether the goods in question were received by the defendant No,1 as badly stained and ship's defective under qualifying remarks? If yes, what is its effect, (4) Whether the fire was accidental and beyond the control of the defendant No,1. If yes, what is its effect? (5) Whether the plaintiffs have right to sue ? (6) Whether any rolls of carpet were damaged while in the custody of defendant No,2? (7) What amount, if any, are the plaintiffs entitled to recover and from which of the defendants ? ' The parties led evidence in support of their respective contentions. The learned Single Judge on assessm ent of the evidence held that the cause of fire was not known. The learned Single Judge
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found that the first respondent had placed all the materials in their possession. He came to the conclusion that the original plaintiffs had not discharged the burden of proving negligence on the part of the first respondent. ' In that view of the matter he decided Issues 1, 2 and 4 against the original plaintiffs. The learned Single Judge held that the original plaintiffs failed to place material evidence before the Court. In that view of the matter, the claim of the original plaintiffs was not accepted. The suit was dismissed. ' Mr. M. Zaheeruddin Khan, learned counsel appearing for the first respondent took a preliminary objection that Q.B.E. Insurance Company Ltd. Not having been a party to the suit it was not competent to Q.B.E. Insurance Company Ltd. To file the appeal.. It was contended that it was only the parties to the proceedings before the Court that had a right of appeal and those persons who were not parties to the suit were not competent to file any appeal even though the judgment and decree appealed might adversely affect their interests. Our attention was directed to the relevant provisions of the Civil Procedure Code, namely, sections 96 and 146 and Order 41, Rule I, C.P.C. It may be noted, however, that in none of these provisions of the Civil Procedure Code has it been laid down who can prefer an appeal. It was further pointed out that in the commentary of Sir Dinshah Mulla on the Civil Procedure Code and also in a judgment of Mr. Madhavan Nair J. In Judian Bank Ltd. v. Seth Bansiram Jeshamal Firm, AIR 1934 Madras 360 it is stated that no person who is not a party to the suit or proceedings has a right of appeal. This is no doubt the position so far as the right of appeal is concerned. A person who is not a party to the suit or proceedings has no right to appeal against the decision and this is the position where a person who is not a such party is aggrieved by the decision and wants to appeal against it. He can only ask for leave to appeal from the appellate Court before he can be allowed to file an appeal. There is no right of appeal vested in him by any of the provisions of the Civil Procedure Code or by any other provision of law. The only remedy open to him, if his interests are adversely affected or if he is aggrieved by decision of the Court, is to approach the appellate Court and also for leave to appeal which the appellate Court would grant in proper cases. This is the position in England as one fords it laid down in In re. Securities Insurance Company (1894) 2. Ch. 410 (63 L.J. Ch. 7777) where Lindley L.J. Observed (p.413):-- "Now, what was the practice of the Court of Chancery before 1862, and what has it been since ? I understand the practice to be perfectly well-settled that a person who is a party can appeal (of course within the proper time) without any leave, and that a person who without being a party is either bound by the order or is aggrieved by it, or is prejudicially affected by it, cannot appeal without leave. It does not require much to obtain leave. If a person alleging himself to be aggrieved by an order can make out even a prima facie case why he should have leave he will get it, but without leave he is not entitled to appeal." Section 456 of the Companies Ordinance, 1984 provides that any failure by foreign company to comply with any of the requirements of section 451 or section 452 shall not affect the validity of any contract, dealing or transaction entered into by the company or its liability to be sued in respect thereof, but the company shall not be entitled to bring any suit, claim any set off, make any counterclaim or institute any legal proceeding in respect of any such contract, dealing or transaction, until it has complied with the provisions of section 451 and section 452. In view of disability to sue, imposed on thedefaulting foreign company by this section, the decision in Sham Raio Krishna Honnali v. United H.B. & Engineer Company AIR 1937 Bombay 24 is no longer applicable. It is to be noted that the Companies Ordinance, 1984 came into force in 1984, whereas the appeal was filed in 1975. When a party prefers an appeal, the appellate Court will have to be satisfied that the appellant is bound or aggrieved or prejudicially affected by the decision of the Lower Court, appealed against. This is the jurisdiction that is exercised by the appellate Court while considering
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an application for leave to appeal to it. On being satisfied that such an appellant has a right of an appeal because he is bound, or aggrieved or prejudicially affected by the decision appealed against the appeal is entertained, of course, subject to all other laws governing an appeal of that sort like those pertaining to limitation, court-fee etc. On granting leave, the permission or grant of leave to appeal relates back to the date of preferring the appeal or in other words, it is not an appeal preferred on the date leave therefor is granted but one filed when it was filed in accordance with other law governing such appeal. Mr. Zaheeruddin Khan submitted that since leave petition or application under section 151, C.P.C. Were filed only. Long after the "appeal was filed within which time the appeal itself might have become barred, and since such appeal cannot exist without application to grant leave or application for substitution of the name, the appeal was incompetent. Such appeal unaccompanied by application to leave for appeal would be defective appeal but not incompetent appeal. Such an appeal can be compared to an appeal filed out of time but without an application to condone the delay accompanying it. On an application to condone the delay being filed C subsequently and the application being allowed by the appellate Court the appeal becomes a proper appeal. So also on an application for leave to appeal or an oral submission or an application for substitution being filed subsequently or oral submission and on that being allowed, the appeal becomes one preferred on the date it was filed. ' The doctrine of Lindlay, L.J. In re: Securities Insurance Company was followed in re: B an infant (1958) Q.B.E. Insurance (International) Ltd 1 QB 12. Limited had moved an application under section 151 of the Civil Procedure Code seeking substitution of the name. This application was contested by the first respondent. QBE Insurance Ltd. Had not obtained any such leave to appeal and had filed the appeal as if in exercise of a right to do so. This position was entirely not tenable and under the circumstances of the case we thought it proper to give QBE Insurance (International) Limited leave to appeal. This disposes of this preliminary objection which was taken by counsel of first respondent. ' What is said above is sufficient to dispose of this Misc. Application by allowing it. The name of OBE Insurance (Internatonal) Ltd. Is substituted. Mr. Imtiaz A. Lari learned counsel for the appellants raised the following contentions: (1) The first respondent had failed to bring on record entire material to show that it had fulfilled the requirement of section 151 of the Contract Act. (2) There are certain facts which establish positive negligence. (3) The finding on issues Nos.3 and 6 is contrary to the evidence on record. Mr. Zahiruddin Khan, learned counsel appearing for the first respondent submitted that the first respondent had brought on record entire material to show that it had fulfilled the requirements of section 151 of Contract Act and the original plaintiffs had not discharged the burden of proving negligence on the part of first respondent. The findings on issues 1, 2 and 4 are in accordance with the evidence on record. ' Mr. Nasimuddin Shaikh, learned counsel appearing for the second respondent submitted that the finding on issues 3 and 6 is in accordance with the evidence on record. The original plaintiffs failed to establish the value of goods. ' We have considered the contentions of the parties with great care. It will be convenient to deal with the issues/points seriatum. It is quite convenient that issues 1, 2 and 4 are put together, dealing as they do with points 1 and 2. ' The learned Single Judge took the view that the first respondent is bailee and its duties and liabilities will he governed by sections 151 and 152 of the Contract Act, 1872. ' It has to be appreciated that the subject-matter of contractual bailment has been dealt with in Chapter IX of the Contract Act. Section 148 defines bailment to mean delivery of goods upon a contract. As it was no body's case that there was any such contract between the consignees and the appellants in this case. Section 151 provides that in all cases of bailment the bailee is bound to
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take as much care of the goods bailed to him as a man of ordinary prudence would under similar circumstances takes of his own goods, bailed. Section 152 provides that the Bailee, in the absence of any special contract, is not responsible for the loss, destruction or deterioration of the thing bailed, if he has taken the amount of care described in section 151. Section 161 provides bailee's responsibility when goods were not duly returned. ' In the Karachi Steam Navigation Co. Ltd,.v. Ebrahim Gani PLD 1957 (W.P.) Kar. 315 it was held that "section 47 of the Karachi Port Trust Act laysdown that the goods discharged and kept in the warehouses of the Karachi Port Trust will be kept at the risk and responsibility of the owner of the goods. It is therefore, clear that the Karachi Port Trust is the agent of the owner of the goods and delivery of the goods by the steamship company under the statutory provisions of this enactment is the delivery of the goods to the consignee. ' In Abdul Jail Choudhry v. The Muhammadi Steamship Company, Ltd. And another PLD 1961 SC 340 the Hon'ble Supreme Court, after referring the above case, laid down the following proposition.:- "We have to observe, however, that there is in this case a reference to the Karachi Port Trust Act and it is stated that the Karachi. Port Trust is a statutory bailee and that delivery to such statutory bailee amounts to delivery of the goods to the consignee. Reference in support of the proposition that the Trust holds on behalf of the consignee has only been made to section 47 of the Act wherein it is provided that in the warehouse of the Karachi Port Trust goods are kept at the risk of the owner. This provision is not by itself sufficient to make the Port Trust the agent of the consignee. We have not found it necessary to go into the various provisions of the Karachi Port Trust Act to see how far the port authorities can be said to hold the goods on behalf of the consignee for it is sufficient to point out that at least in the present case the Port Authorities who could not have delivered the goods without a delivery order from respondent No,1 were not agents of the consignee." ' In East and West Steamship Company v. Hossain Brothers and others PLD 1968 SC 15, Mr. S.A. Rahman, J., held as follows:- "I agree but would add that even if the contract of carriage by sea could be said to have ended with the discharge of goods from the ship into a lighter engaged by the shipowners the latter would not be absolved from liability as bailee of the goods till they were handed over to the consignee or their agents or assignees" in Farook Omar v. National Security Insurance Company Ltd., Karachi and another PLD 1974 Kar. 321 a learned Single Judge held that Karachi Port Trust are statutory bailee and delivery to the Karachi Port Trust is on behalf of the consignee. In this case no reference was made to PLD 1961 SC 340 and PLD 1968 SC 15. In the case reported in PLD 1983 Kar. 242, it was held that K.P.T. May in certain circumstances be treated as agent of the consignees but certainly it is only a statutory agent for limited and restricted purposes. ' The dictum laid down in PLD 1961 SC 340 was followed in the case of. Messrs Tar 'Muhammad Janoo & Co., v. Messrs Maldivian National Corporation (Gaylon) Ltd. And another PLD 1989 Kar. 495. The principle laid down by the Honourable Supreme Court in the above case is applicable to the facts in the instant case. ' So even though there was no contractual bailment, either according to the pleadings of the parties or on the wordings of section 47 of the Karachi Port Trust Act, the responsibility of the first respondent is of the nature aforesaid, as the bailee of the consignee (M/S. Amin Sales Ltd.) by virtue of that section. It may be mentioned that we have gone through the pleadings and there is justification for the view that the original plaintiffs based their claim on the breach of a mere statutory duty of the first respondent under section 47 of the Act. It is well-settled that the essence of bailment is possession. It is equally well-settled that bailment may arise, as in this case, even when the owner of the goods has not consented to their possession by the bailees at all. (Palmar on Bailment, 1979 Edition, page 2) In Gilehrist Watt & Sanderson Pry Ltd. v. York Products Pty Ltd
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(1970)3 All ER 825, the facts were that the shipowners carried two cases of clocks belonging to the plaintiff in their vessel from Hamburg to Sydney, where the defendants carried on the business of stevedores and ship agents. The bill of lading provided, inter alia, "When the goods are discharged from the vessel, they shall be at their own risk and expense; such discharge shall constitute complete delivery and performance under this contract and the shipowners shall be freed from any further, responsibility": The defendants unloaded the two cases from the vessel at a wharf belonging to the Maritime Services Board, but of which the defendants has the use and control. When the plaintiffs sought to take delivery of the two cases, one of them was missing and was not recovered. The plaint1s sued the defendants on the ground, inter alia, that there were delivered to the defendant in Sydney certain goods of the plaintiff to be safely kept and taken care of by the defendant for the plaintiff and defendant received and had the said goods in its care and keeping for the purpose and upon the terms aforesaid. Yet the defendant kept the said goods in a negligent manner and took no care of the same. Whereby the said goods were wholly lost to the plaintiff. A finding by the trial Judge that the loss would not have occurred if the defendants had exercised reasonable care was not contested. ' The question at issue before the Honourable Privy Council was whether the defendants as bailees owed a duty of care to the plaintiffs. If there was such a duty, the defendants committed a breach of it and thereby caused the loss. The trial Court found that the loss would not have occurred if the defendants had exercised reasonable care, and this finding has not been contested. The trial Judge held that there was a bailment, although there was no egress agreement of bailment. He made an finding that the defendants notified the plaintiffs that the goods had arrived. Then his view was that the defendants' duties as agents for the shipowners were completed, when they notified the plaintiffs that they had the plaintiffs' goods on the wharf and thereafter they held the goods with the plaintiffs' consent and retainedpossession and control of the goods and thereby a bailment was created. This finding was contested by the defendants before the Privy Council. It was held as follows:- "Both on principle, and on old as well as recent authority it is clear that, alhough there was no contract of attornment between the plaintiffs and the defendants, the defendants by voluntarily taking possession of the plaintiffs' goods, in the circumstances assumed an obligation to take due care of them and are liable to the plaintiffs for their failure to do so (as found by the trial Judge). The obligation is at any rate the same as that of a bailee, whether or not it can with strict accuracy be described as being the obligation of a bailee. In a case such as this, the obligation is created by the delivery and assumption of possession under a sub-bailment. In the English Courts the word 'bailment' has acquired a meaning wide enough to include this case. It may not have acquired such a wide meaning in the Australian Courts. It is to be observed, however, that there is no express reference to bailment in Court of the particulars of claim on which the plaintiff succeeded, on a reasonable construction of that count this case falls within it." It follows therefore that as the claim in the instant case was not based upon a mere breach of statutory duty under section 47 of the Act and was based on the Board's liability as bailee, it was no other than by way of an action in tort. It may be that, as in the instant case, certain obligations were fastened on the Board under section 47 of the Act which were not in truth contractual inasmuch as they did not rest on agreement. Such a relationship may be called E as one arising out of an implied contract. A duty to take charge of the landed goods was cast on the Board under section 47. By the very nature of that relationship, which admittedly did not arise out of an agreement between the parties, it was not essentially a delictal obligation. It was civil wrong for which the remedy was an action for damages and not by way of an action for breach of contract, as it is nobody's case that there was any such relationship between the parties.
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' Halsbury has put in fourth edition, Volume 45, page 558 at para. 1201, while dealing with the nature of liability the position is as follows:- "Those civil rights of action which are available for the recovery of unliquidated damages by persons who have sustained injury or loss from acts, statements or omissions of others in breach of duty or contravention of right imposed or conferred by law rather than by agreement are rights or action in tort." ' Reference may also be made on Stuart on Torts, Sixth Edition at page 3, that an action for breach of a statutory duty is an action in tort. As has beenpointed out on page 6 of Stuart on Torts (7th Edition), there is no fixed catalogue of circumstances which alone and for all time mark the limit of what are torts. The Law of Torts is concerned with those situations where the conduct of one party causes or threatens harm to the interests of other. Parties. As in the instant case, such goods shall be retained either in the warehouses and sheds of the Board under section 47 of the Act. Section 49 provides that wherever goods which have been landed, have, without any default on the part of the Board, been left for five clear days on or in any warehouse or shed belonging to the Board, the Board may cause such goods to be removed…
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