Al Wakeelo
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Your Digital Lawyer, Always on Duty
Initializing Secure Chambers
Petitioner: CAP. YOUSUF KAZI AND Another VS Respondent: S. S. PHOENIX AND 3 Other
Court Name: Sindh High Court Judge(s): Naimuddin Ahmed Title: CAP. YOUSUF KAZI AND Another vs S. S. PHOENIX AND 3 Other Case No.: Suit No. 105 of 1977 Date of Judgment:1978-06-20 Reported As: PLD 1978 Karachi 1052 Result: H.
JUDGMENT
JUDGMENT The plaintiffs who are partners of Messrs International Shipping Agency have brought the suit in rem in the admiralty jurisdiction of this Court against s. s. Phoenix, a ship registered in Greece for recovery of Rs. 4,66,419.67, being the balance amount due from the defendants as per disbursement account. They have also joined its owners which is a Company carrying on business in Greece, the Managing Director of the Company and Pioneer Shipping Agencies Limited which was first appointed by the plaintiffs' firm as sub-agent to handle the ship, as parties to the suit. This takes the action in rem as well as in personam. The case of the plaintiffs briefly stated, is that on 1-7-1976 defendant 2 appointed the plaintiffs' firm as its exclusive shipping agent in Karachi for its ship s. s. Phoenix and for its other vessels. Defendant 3 by letter dated 24-9-1976, addressed to the plaintiffs firm informed them that s. s. Phoenix would reach Karachi by 10th or 12th October 1976 and requested the plaintiffs to represent the ship. The ship arrived at Karachi on 15-11-1976 and according, to the plaintiffs it had a number of problems including that of the crew. It needed bunker oil and repair. Defendants 2 and 3 asked the plaintiffs to handle the ship and for this purpose to engage the services of Stevedores and Ship Chandlers, etc. The plaintiffs it is alleged, that on instructions from defendants 2 and 3 tried their level best to overcome the various problems and called upon defendants 2 and 3 to provide at least 400 tons of bunker oil so that the ship could take Cargo for Kuwait and reach its destination. It is alleged that the said defendants failed to provide the same. On the requests of defendants 2 and 3 the plaintiffs engaged Central Shipwright Contractors to carry out the repairs to the ship. On 23- 11-1976 they required the plaintiffs to ask the Captain to sign off the crew and to debit their tickets and hotel expenses and to keep the ship in good condition and to attend to other requirements of
---
## Page 2
the crew on board. According to the plaintiffs defendants 2'and 3 knew well that the plaintiffs' work as Shipping Agent vis-a-vis the authorities was undertaken by defendant 4 who held the licence. They engaged Messrs Dinsbaw & Company, Stevedores and Dubashes who carried out workof the value of Rs. 1,41,452.71, out of which they paid Rs. 1,00,000 to them and the balance is due from defendants I to 3. The plaintiffs further claim what Central Shipwright Contractors carried out the repairs to the ship of the total amount of Rs. 1,43,550. . The ship chandlers supplied food and necessaries of the value of Rs. 70,796. It is also claimed that Sind Lighterage Company had carried on the loading of the cargo and submitted their bills for Rs. 1,09,61.9. The plaintiffs claim to have paid salaries to the crew and the officers and advances to the Master amounting to Rs. 2,27,887.77. The plaintiffs have claimed several other amounts on account of supply of bunker oil, watchman charges, laundry charges, tally charges, commission, etc. As mentioned in the disburse--ment account reproduced In extenso hereinafter. According to the plaintiffs the total freight received for the cargo loaded on board the ship was a sum of Rs. 7,02,263.72, while the total disburse--ments in respect of the ship were of the total sum of Rs. 11,68,783.39 as per details contained in the Disbursement Statement (Exh. 37/11.6), which are as follows :---- DISBURSEMENTS STATEMENT OF S. S. PHOENIX Rs. Stores and Provision70,796.00 Watchman charges6,570.00 Laundry charges1,039.90 Lubricants and Oil26,223.00 Tally Charges9 000.00 Food Expenses through Chief52,835.19 Steward and other expenses76,542.15 Cash advance to Mastes and other payments to crew2,27,888.77 Stevedoring charges1,41,452.71 Telex charges (Approximate)1;000.00 Medical treatment and expense3,320.00 Bunker 50 tons41,669.00 Bonded Stores5,550.00 Lighter charges1 81 273.00 Repairs1,4 2,461.00 Commission on Import Cargo on U. S. 2 --% (20,000 Approximate)5,000.00 Commission on outward Cargo 5 % on Rs. 7,02,363.7235,118.19 Brokerage 2 % on 7,02,363.7214,047.27 Miscellaneous Expenses35,000.00 Freight Tax 11 % on Rs. 7,02,363.7277,260.00 Pioneer Shipping Agencies Ltd. for s. s. Phoenix on A/c.22,232.40 11,39,783.39 Telex and other expenses payable to Transworld Shipping Corporation Ltd .29,000.00 LESS
---
## Page 3
11,68,783.39 Freight Receipts7,02,363.72 Balance in our favour 4,66,419.67 It is stated that the plaintiffs made a demand for payment of this amount on the defendants 2 and 3 and requested them to come to Karachi. Defendant 3 arrived in Karachi on 4-2-1977 but failed to meet the difference of Disbursement Account. It is also claimed that defendant 2 wanted the plaintiffs to provide Bunker Oil and pay port dues and on their refusal to do so defendants 2 and 3 terminated their authority and by the letter dated 4-2-1977, appointed defendant 4 as their local agent of the ship. Therefore, the plaintiffs have prayed for judgment and decree against the defendants jointly and severally in the sum of Rs. 4,66,419.67, being the balance amount shown in the Disbursement Statement with costs and interest at 16 per cent per annum from the date of the suit till payment. The defendants 1, 2 and 3 filed their joint written statement pleading that plaintiff 1 had met defendant 3 in Mombassa and had assured that after the ship reached Karachi all the expenses of bunker oil, crew and repairs and other expenses of the ship would be met out of freight earnings. They also pleaded that the suit is not maintainable in the Admiralty jurisdiction of this Court. With regard to the services rendered by the ship chandlers, Stevedores & repairers the defendants expressed their ignorance and denied that Messrs Dinshaw & Company had carried out the work of Rs. 1,41,452.71. They further pleaded that if the plaintiffs have made any payment to the said Messrs Dinshaw & Company they did so at their own risk. They also urged that the amount claimed by the Stevedores was fantastic and at least three times above the normal market rate and the rates charged by them from others. With regard to the claim for repairs they state that the bills were highly inflated and false. As regard the bills of ship chandlers it is stated that the same are highly inflated. Regarding the bills of Sind Lighterage Company it is stated that they are false and fictitious. It is further pleaded that to the best of the information of the defendants no lighterage expenses were incurred on account of the ship. The defendants also denied that the plaintiffs have paid salary to the crew and officers, and made advances to the Master amounting to Rs. 2,27,887.77. As regards the problems relating to vessel at Karachi it is stated that the plaintiffs, instead of attending to these, by their various acts of commission and omission mismanaged the whole affair and later on deliberately created more problems with the ulterior object of harming the interest of the vessel, and finally rendered the vessel unseaworthy, e.g., by losing the anchor of the vessel, damaging the winches and stowing the cargo badly. With regard to the claim of the plaintiffs that they had earned total freight of Rs. 7,02,263.72, the defendants submitted that the freight of the cargo loaded on board the vessel at the prevailing market rate was much more than that shown by the plaintiffs. The defendants further denied that the total disbursement in respect of the vessel amounted to Rs. 11,68,783.39. The said defendants denied that they terminated the appointment of the plaintiffs for the reason that they had refused to meet the expenses of the vessel. They stated that when defendant 3 came to learn that the plaintiffs were not licensed ship agents and that the agency of the vessel was being handled by defendant 4 from the very beginning, they merely confirmed the appointment of defendant 4. As regards the appointment of defendant 4 as sub-agent they denied that they knew defendant 4 was handling the agency of the vessel. Defendant 4 filed its separate written statement claiming that the suit was not maintainable in law and was bad for misjoinder of the parties and that defendant 4 was neither proper nor a necessary party to the suit. It further pleaded that the plaintiffs had never appointed defendant 4 as sub- agent as alleged.
---
## Page 4
The learned counsel for the parties filed the following consent issues which were adopted by the Court. (1) Whether the suit is not maintainable? (2) Whether the plaintiffs made representations as alleged and mis--managed the vessel as alleged? (2-A) Whether the plaintiff's have no claim and/or cause of action against defendant No. 4 and the plaint is liable to be rejected under Order VII, rule 11, C. P. C. Against defendant 4? (3) Whether the plaintiff's are entitled to the sums claimed from the defendants ? (4) What is the sum collected by the plaintiffs as freight? (5) What is the effect of plaintiffs not holding a licence under the Customs Act? (6) What should the decree be? The plaintiffs in support of their case have examined Ahmed Khan P. W. 1 (Exh. 6), Akhtar A.I Khan, P. W. 2 (Exh. 7), Feroz H. Dinshaw, P. W. 3 (Exh. 8), Syed Dastgir, P. W. 4 (Exh. 9), Muhammad Ikramuddin, P. W. 5 (Exh. 10), S. H. Mahmood, P. W. 6 (Exh. 11), Farhat A.I, P. W. 7 (Exh. 12), Hashim Raza, P. W. 8 (Exh. 13). Humayun Abbas, P. W. 9 (Exh. 14), Zakaria, P. W. 10 (Exh. 15), Akbar Anjum Shaikh, P. W. 11 (Exh. 16), Dr. M. Farooqui, P. W. 12 (Exh. 17), Abdul Salam, P. W. 13 (Exh. 18) and Yousuf Amin, P. W. 14 (Exh. 19), besides the plaintiff No. 1 whose evidence is Exh. 37. A large number of documents have also been produced, some of them were brought on record by consent of the parties. On behalf of defendants 1 to 3 only defendant 3 came into the witness-box and his evidence is Exh. 38. Now, before I deal with the issue framed in this case I may state that the suit is liable to be dismissed on the short ground that the evidence produced by the plaintiffs in this case shows that they have not disbursed the total amount of Rs. 11,39,783.39 as alleged but have disbursed only a total sum of Rs. 4,78,057.24 which amount is less than the amount of Rs. 7,02,363.72 which they admittedly had in their hands on account of the freight earnings. The plaintiffs have based their suit on the balance due on disbursement account. The meaning of disbursement as given in the Oxford English Dictionary, 1961 Edition, is "the action or fact of disbursing that which has been disbursed ; money paid out ; expenditure". If the plaintiffs had not paid the full amount as shown in the disbursement statement they had no cause of action for filing the suit. In fact their action of getting the ship arrested even before they had paid the amount appears to be the result of termination of the agency of the plaintiffs by defendants 1 to 3 on 4-2-1978, and therefore mala fide. Further, they have made a large number of claims which are found exaggerated or inflated, besides there being no proof whatsoever, in respect of some of them as I would presently show while dealing with each item separately. Now, I would first take up Issue No. 3 which is whether the plaintiffs are entitled to the sums claimed from the defendants. The first claim is of payment of Rs. 70,796 on account of supplies of stores and provisions made to defendant 1. This amount is made up of three items. The first item is of Rs. 35,991.20 on account of supplies made by Nak Ship Chandlers. The second item is of Rs. 30,900 on account of supplies of provisions made by Foodco Suppliers. The third item is of Rs. 5,099 on account of supplies made by Piraeus Basileous Ship Chandlers. It is admitted by the learned Advocates for the parties that the total amount of these bills comes to Rs. 32,520.80, although the plaintiffs have claimed Rs. 35,991.20 on account of payment to Nak Ship Chandlers. Only Mr. Iqbal Kazi Advocate admitted that the plaintiffs have supported the claim by the bills and the receipts of the total amount of Rs. 32,520.80 only. Mr. A. H. Mirza submitted that these bills are highly inflated and bear rubber stamps of the Master of the Ship, `subject owners approval'. But the defendants have not produced any evidence that the defendants disapproved of the bills at any time. They also did not lead any evidence that these bills are inflated. Mr. Mirza
---
## Page 5
further submitted that the suppliers namely, NAK Ship Chandlers had agreed to reduce their claim by Rs. 11,000 to Rs. 25,000 but he admitted that excepting a bare suggestion made to the witness in his cross-examination to this effect no evidence has been produced by the defendants in this regard. Even defendant 3 who carne in the witness-box did not make any statement with regard to the alleged agreement or with regard to the prices mentioned in the bills (Exhs. 7/z, 7/4 to 7/43). Mr. Iqbal Kazi argued that by suggesting to P. W. 2 that he had agreed to reduce the claim by Rs. 11,000 defendants have impliedly admitted that the supplies made to the ship were of the value of Rs. 36,000. Although I do not accept the suggestion for want of supporting evidence, the suggestion is not totally without basis for no evidence has been produced by the plaintiffs in support of a part of their claim. Not only that the plaintiffs have failed to produce any receipt for part of their claim, i.e. For Rs.3,470.40 but also they have not produced any account books. 1, therefore, hold that the plaintiffs have proved the claim for supplies made by NAK Ship Chandlers to the defendant to the extent of Rs. 32,520.80 only. (ii) The second amount claimed by the plaintiff is of Rs. 30,900 on account of supplies of provisions made by Foodco Suppliers. (iii) The third amount claimed by the plaintiffs is a total sum of Rs. 5,099 on account of supplies made by Piraeus Basileous Ship Chandlers and covered by three bills (Exhs. 20, 22 and 23) which were admitted by Mr. Mirza, Advocate for defendants 1 to 3, and which have been brought on record by his consent. Since these bills were admitted by the defendants this claim stands proved. Thus instead of Rs. 70,796, the plaintiffs have proved the claim under the first item for Rs. 68,017.20. The plaintiffs have claimed a sum of Rs. 6,570 on account of watchman charges paid by them. In support of this claim the plaintiffs have produced the bills of Syed & Brothers. These bills were brought on record and marked as Exhs. 29 to 31 by consent of the Advocate for the defendants. However, the objection of Mr. Mirza is that the total amount of the bills comes to Rs. 5,070. He submits that the plaintiffs have not led any evidence whatsoever, for the rest of the amount claimed under this head. Mr. Iqbal Kazi, Advocate agrees that there is no evidence in support of the claim for Rs. 1,500 under this head. Accordingly, the plaintiffs have proved their claim for Rs. 5,070 under this head. The plaintiffs have claimed a sum of Rs. 1,039.90 on account of Laundry Charges paid by them. In support of this claim the plaintiffs have produced four bills (Exhs. 32 to 35) for the total amount of Rs. 1,039.90 which were admitted on behalf of the defendants 1 to 3. Mr. Mirza advanced no arguments regarding this claim. I accordingly, hold that the claim stands proved. Under the head of Lubricants and Oil the plaintiffs have claimed a sum of Rs. 26,223 on account lubricants, oil and charges for barges for transport of oil supplied and provided by Umer Suppliers. In support of this claim, the plaintiffs have examined Zakaria son of Haji Umer whose evidence is Exh. 15. He hat proved five bills Exhs. 15/1 to 1-5/5. The total amount of the four bills (Exhs. 15/1, 15/2, 15/3 and 15/5) comes to Rs. 26,223. If the amount of the bills Exh. 15/5, is added thereto, the total amount of the claim will increase to Rs. 32,163. The objection of Mr. Mirza with regard to the claim for Rs. 5,940 allegedly paid by the plaintiffs to Umer Suppliers vide Exh. 15/4 is that this amount has not been included in the amount claimed in the suit. However, the submission of Mr. Kazi is that notwithstanding the fact that the plaintiffs have not included the amount of this bill in the amount claimed under the above head, the plaintiffs are entitled to it as Zakaria has proved that the barge for carrying the oil supplied by the Premier Oil Company was provided by Umer Suppliers. He further submitted that Abdus Salam son of Hakim of Premier Oil Company in his deposition has stated that the supplies to the ship were arranged through the barge provided by Umer Suppliers, therefore, the claim on account of charges for the supply of barge carrying the supply to the ship stand proved.
---
## Page 6
But the fact remains that the plaintiffs did not include the amount of the bill (Exh. 15/4) in the amount claimed in the suit nor did they apply for amendment of the amount claimed in the suit. Plaintiff No. 1 who came in the witness-box did not give any explanation as to why he did not include this amount in the claim. In these circumstances it would not be fair to defendants 1 to 3 to saddle them with this amount. The plaintiffs, according to the disbursement statement, have claimed a sum of Rs. 9,000 on account of Tally Charges. Feroze H. Dinshaw partner of the, firm Messrs Dinshaw & Company in his evidence (Exh. 8) has produced in his cross-examination 3 Tally Sheets (Exhs. 18/19 to 18/21). The defendant in his cross-examination has produced 8 Tally Sheets collectively marked as (Exh. 38/24) of Sea Lines Corporation, Tally Contractors. However, the plaintiffs have not produced any bills for Tally charges nor Captain Kazi who came in the witness-box has said anything about the payment of the charges to Sea Line Corporation. Defendant in his deposition (Exh. 38) stated that the Tally charges have been inflated to Rs. 3 per ton as the market rate was only Re. 1 per ton. According to the calculation made by the learned counsel for the parties on the basis of the Exhs. 8/19 to 8/21 and Exh. 38/24 the total of the cargo for which the Tally work was done is 3285 tons. Mr. Iqbal Kazi, Advocate argued that the number of packages for which the Tally work was done was 27,648 and therefore, the amount claimed is reasonable but in the absence of any bills and proof of payment to Sea Line Corporation, or any other evidence with regard to the market rate of tallying work I am afraid, if I accept this suggestion to Mr. Iqbal Kazi I would be basing my finding on no evidence but purely on conjectures, more so when defendant 3, who came in the witness-box has made a definite statement that the market rate was rupee one per ton and he has not been cross-examined thereon. It is true that except bare words of defendant 3 there is no other evidence led by him as regards the market rate. However, the burden of proving the claim being on the plaintiffs they should have discharged it, but they failed to do so. I, therefore, bold that the plaintiffs are entitled to Rs. 3,285 on account of Tally Charges. The next item of claim made by the plaintiffs in the disbursement statement (Exh. 37/116) is with regard to Launch Hire Charges. In support of this claim plaintiff No. 1 stated in his deposition that he had hired passenger launch for carrying crew and the officers of the ship from to port basin Keamari and back to the ship and that he made two payments of Rs. 1,060 and Rs. 1,280 to Ahmed Moosa which are supported by two receipts (Exhs. 37/100 and 37/101). The plaintiffs also produced two bills collectively marked as Exh. 36 signed by Ahmed Moosa, Launch Contractor for Rs. 1,060 and Rs. 1,160 which have been admitted by the Advocate for the defendants. These bills bear an endorsement "M. C. B. Chequ. C. M. Q. 6986069, dated 26-11-76 for Rs. 2,340". This endorsement implies that the payment of Rs. 2,340 was made to Ahmed Moosa, Launch Contractor. Mr. A. H. Mirza, Advocate for the defendants while arguing admitted this claim. I, therefore, hold that the claim under the said head stands proved for the full amount. The plaintiffs have claimed in the disbursement statement (Exh. 37/ 116) a total sum of Rs. 23,706.96 on account of payments made to five hotels named below. The break-up of this amount is also shown against the names of the said hotels. Rs. 22,826.96 According to the plaintiffs, these payments were made on account of stay of members of the crew and the two Masters of the vessel. So far as the claim for payment of the amount to Bristol Hotel is concerned the plaintiffs have examined Mr. S. H. Mahmood, Manager of the Hotel (Exh. 11) who deposed that 9 persons mentioned in the deposition had stayed in his hotel from 2211-1976 to 29-11-1976 and Captain Kazi had paid their boarding and lodging charges. In support of the said payment he produced the photostat copy of the Customers Register (Exh. 11/1) duplicate bill for Rs. 7,603.31 (Exh. 11/2) and the receipt
---
## Page 7
dated 29-I1-1976 for Rs. 7,390.76 (Exh. 11/3). Mr. A. H. Mirza, Advocate for the defendants submitted that the plaintiffs have been able to prove their claim only to the extent of Rs. 7,390.76 made to this hotel. There is no other oral or documentary evidence as regards the payment of the rest of the amount of Rs. 217.65. I, therefore, hold that the plaintiffs paid Rs. 7,390.76 to the said Hotel and are entitled to claim the same from the defendants 1 to 3. The plaintiffs have claimed a sum of Rs. 4,445.05 on account of payment made to Hotel National City. In support of this claim the plaintiffs examined Akbar Anjum Shaikh, the Manager of the Hotel. His deposition is Exh. 16. The amount claimed is made up of the following four amounts :---- (i) Rs. 2,127.44 ; (ii) Rs. 1,443.71 ; (iii) Rs. 730.12 ; and (iv) Rs. 143.78. And in support of this claim the witness produced bills and receipts Exhs. 17/1 to 16/40. In the first instance Mr. Mirza admitted the payment of two amounts of Rs. 730.12 and Rs. 143.78 covered by bills (Exhs. 16/37 and 16/38). He however, during the course of arguments further admitted the amount of Rs. 2,127.44 covered by the bill (Exh. 16/1) and the receipt dated 18-1-1977 (Exh. 16/2). The receipt for payment of the amount of Rs. 2,127.44 is in the name of International Shipping Agency, the firm of the plaintiffs. Therefore, it is obvious that the payment of this amount must have been made by the plaintiffs. Now, the only disputed amount is of two bills (Exhs. 16/3 and 16/8) for Rs. 1,443.71. It may be mentioned that the bill Exh. 16/3 includes amount of the bill of Exh. 16/8. These two bills with 33 supporting vouchers Exhs. 16/4 to 16/7 and 16/9 to 16/36 are all in the name of Mr. Magdy Sayeed Alessaf. It is contended by Mr. Mirza that since these bills are in the name of Mr. Magdy Sayeed Alessaf, payment thereof must have been made by him. On the other hand Mr. Iqbal Kazi has argued that although these bills are drawn in the name of Mr. Magdy they show the address of the firm of the plaintiffs as they bear the words "care of International Shipping Agency" as in case of all other bills and he therefore, wishes me to conclude that the payment must have been made by the plaintiffs. He further submitted that since Mr. Magdy was one of the members of the crew and since the crew had no money, the payment must have been made by the plaintiffs. However, it is not possible to draw such a conclusion for where payments were made by the plaintiffs their name is shown as in the case of the two former bills. In any case, the plaintiffs have failed to produce any receipt for the payment of the amounts of the two bills. Further, it is the case of the plaintiffs themselves that they had advanced certain moneys to the members of the crew and they have claimed a sum of Rs. 2,27,888.71 on account of payments made to the other members of the crew. Therefore, in the circumstances it cannot be said conclusively that the crew had no money with them. Moreover, Anjum Shaikh (Exh. 16) in his examination-in-chef had in clear terms, stated that the payment of these bills was made by Mr. Magdy. I, therefore, hold that the plaintiffs have proved payment of Rs. 3,001.74 out of claim of Rs. 4,445.05 on account of payment made to Hotel National City. The plaintiffs have claimed a sum of Rs. 8,346.40 on account of payment made to Hotel Mehran for stay of Mr. Schifito, the Chief Engineer of the ship, his wife Wong Rane, Captain Efsthathion and Captain Constantinos. The plaintiffs have examined Yousuf Amin (P. W. 14) who was P. A. To the Managing Director of Hotel Mehran at the relevant time. His evidence is Exh. 19. He has proved the bills and the…
Read the unabridged text and precedent citation network on Al Wakeelo Legal Research Platform.