121-NLR-NLR-V-51-NATIONAL-BANK-OF-INDIA.-LTD-Appellant-and-ESSACK-Respondent.pdf
JAYETTLEKE C.J.—National Bank of India Ltd. v. Essack
505
(950Present: Jayetileke C.J. and Gunasekara J.
NATIONAL BANK OF INDIA, LTD., Appellants, andESSACK, Respondent
8, C. 29—D. C. Colombo, 18,398
Contract—Bill of lading—Negligence in taking up a bill of lading contrary to instruc-tions—Damages—Evidentiary value of statements contained in a bill of lading—Civil Law Ordinance {Cap.- 66)—Bills of Lading Act, 1855—Carriage of Goodsby Sea Ordinance (Cap. 7t), Schedule, Article III, Rule 4.
Plaintiff sued the defendants for recovery of damages for negligence in-taking up a bill of lading which did not comply with his instructions to them.His complaint was that though he instructed the defendants to honour fromono M in Iraq drafts covering a shipment of 52 tons of dates, the defendants'agent in Iraq paid upon a bill of lading covering a shipment of 47 tons only.He claimed from the defendants the value of the unshipped quantity of dates -as damages for neglignnce.
In regard to the actual weight of tho consignment of dates received by him;-plaintiff relied solely on the statement in the bill of lading that only 47 tonswere shjppod.
Reid, that there was negligence on the part of the agent of tho defendantsin honouring M's draft when the bill of lading accompanying it did not showthat 52 tons of dates had been shipped.
Held further, that the action was not one by or against the signer of the bill'of lading or the owner of the ship, and the statement in the bill that 47 tonswere shipped could not be regarded as evidcnco against the defendants. Inthe circumstances, the plaintiff was entitled only to nominal damages,
i^LPPEAL from a judgment of the District Court, Colombo.
H, W. J aye.wardenc, for the defendant-appellants,
J. R. V. Ferdinands, with 0. F. Sethukauater, for the plaintiffrespondent.
Cur. adv. vult~
August 4,1950.. Jayetileke C.J.—
Tho plaintiff suod the defendants in this action for the recovery of a'sum of Rs. 1,525 os damages for negligence in taking up a bill of lading,which did not comply with his instructions to them.
The plaintiff entered into a oontract for the purchase of 52 tons of’dates from one Mehta of Basrah. The contract was not proved at thetrial but the letter of credit shows that it was a cost, insurance and:freight contract. After entering into the contract the plaintiff by his-lctter P 3 dated January 1G, 1947, requested the defendants to negotiatedrafts drawn on him by Mehta to the extent of Rs. 15,860 providedMehta surrendered to them shipping documents consisting of an on.board bill of lading, an invoice, and a policy of insurance representing
u.
1J. N. 09740—1,049 (8/50)
JAYETILEKE C.J.—National Bank of India Ltd. v. Eseack
f>OG
a shipment of about 1,000 bundles of dates weighing 52 tons c.i.f.Colombo to be shipped per s.s. Minot Victory, and promised to honoursuch drafts at maturity. The defendants agreed to do so and madethe following endorsement on P 3—
“ This credit is confirmed by the National Bank of India, Ltd.
E. Maconochie,Manager ”.
'Thereafter the defendants arranged with the Ottoman Bank of Basrahto honour Mehta’s drafts. The Ottoman Bank honoured Moiita’a draftP 5 and paid him Rs. 15,860 as against the invoice P 6, the bill of ladingP 7 and a policy of insurance which was not produced at the trial. P 7■states as follows :—
*' Quantity or number of pieces or packages..940
Description of goods. Baskets dates.
(bundles) kilos., 47,000
Nine hundred and forty baskets only.
Freight kilos'47,000 at 1 D. 4. 125 per 1,000 kilos.
Pounds…. 193.875
According to the evidence 47,000 kilos are equal to 47 tons.
P 6 states as follows :—
“ No. of packages….940
.Particulars.Dates each bundle to weigh about 124
kilos. Total 1,040 cwt. at Rs. 15.4.0,c.i.f. Rs. 15,860
It must be noted that the invoice does not agree with the bill of ladingand that there is a difference of five tons in the weights given in them.The goods are described in the plaintiff’s instructions to the defendantsin P 3 by reference to woight and quantity. The weight is given as52 tons and the quantity as about 1,000 bundles. The value of the■goods is also given as Rs. 15*25 per cwt. When P 3 is examined it.seems to be clear that the weight of the goods was the essential thingfrom the plaintiff’s point of view. The plaintiff complains that thoughhe requested the defendants to honour drafts covering a shipment of-62 tons they have paid upon a bill of lading covering a shipment of47 tons. He claims in this action from the defendants the value of the•unshipped quantity of dates as damages for negligence. There canbe no question that there has been negligence on the part of the agentof the defendants in honouring Mehta’s draft which was not accompaniedby a bill of lading showing that 52 tons of dates had been shipped. Thepoint is covered by the decision in London and Foreign Trading Corpora-tion v- British and Northern European Bank.1 In that case the plaintiffs1 (1921) Lloyd's Law Reports, 11$.
507
J A VKTILKKE C.J.—National Bank of India Lid. v. Baaack
had purchased 500 tons of meal from a Singapore firm, the contractrequiring the buyers to open credit in London. This they did withthe defendant bank. The plaintiff’s instructions authorised thedefendants to pay against a bill of Jading to order and endorsed in. blank,insurance policy, invoice for 500 tons maize meal c.i.f. Liverpool, shippedper steamer from Singapore to Liverpool. The defendant bank paidagainst a bill of lading covering 5,805 bags of maize meal with no referenceto weight. The accompanying invoice stated that what was forwardedwas 5,805 bags at 100 lb. per bag oqual to 500 tons. Although thestated number of bags was shipped they weighed only 448 tons. Theplaintiffs sued the defendants for breach of duty in paying against thosedocuments. The defendants contended that they were entitled to relyon the statement in the invoice but this contention was rejected andjudgment was given for the plaintiffs for the value of goods shortdelivered. Itowlatt .T. said :—
11 ft is to be observed that the bill of lading that is required by theletter of credit says nothing about weight or quantity of goods, orwhat the goods were or where they wore coming from or whore theywere going to. All it specifies is that it is to order, that it is to beendorsed in blank, and its date.
Similarly the insurance policy merely names the risks covered.It is only when you got to the invoice you get the amount specified,the commodity itself specified, the price specified and the contractof sale specified. But to my mind it is quite obvious that when youread these you must read the requirements of the bill of lading andthe insurance policy as the requirements of the bill of lading andinsurance policy relevant to the invoice. It cannot mean that it isto be a blank form of bill of lading and insurance policy. They mustbe relevant to the invoice. Therefore I think nothing turns on theomission to state when the requisitee of the bill of lading are beingset out the quantity there, because I think that argument wouldcarry otic so far as to land one in an absurdity.
Therefore it soetns to me what tbo bank were authorised to do wasto pay against a bill of lading which answered to the invoice, so thatthe buyer got the responsibility of the ship for the amount of goodswhich his seller was charging him for
The only other question is what damages the plaintiff is entitled to.On this question the case I have referrod to is not helpful because thedamages scorn to have been agreed upon by the parties. The factsof that case show that the plaintiffs had re-sold the meal to buyers inLiverpool, the latter had made a claim against the plaintiffs in respectof the deficiency, and plaintiffs had paid that claim. The action wasbrought for the recovery of the amount paid by the plaintiffs to thebuyers in Liverjwol.
At the trial of this case counsel for the defendants suggested thefollowing issue:—
“ What is the actual weight of the full consignment of dates receivedby the plaintiff in respect of tbis particular transaction ? ”
508JAYETILEKE C.J—National Bank of India Ltd. v. Esvatk
Counsel for the plaintiff successfully objected to this issu© on the groundthat the statemont in P 7 that only 47,000 kilos wero shipped was conclu-sive as between the plaintiff and the defendants and that the plaintiffwas ©ntitlod to recover the value of the deficiency independently ofthe woight- shippod. Tho identical argument was advanced at thehearing beforo us but no authority was cited in support of it. Chaptor66 introduced into Ceylon tho Law of England in maritime matters.Tinder the Bills of Lading Act 1855 1 the bill of lading is conclusiveevidenco in favour of a consignee or indorsee for valuable considerationof the shipment of the goods against the master or the person signingthe bill of lading. But it is not conclusive as botw'een the signer andthe shipper, nor as between the ownor and the shipper, nor as botwoenthe owner and tho holdor for value unless tho ownor signs It himself orby a servant. In all those oases tho statements in the bill of lading areprima facie evidence which the person disputing them must disprovo(Sorutton on Charter-Parties and Bills of Lading, page 78). Rule 4 ofthe rules framed under tho Carriage of Goods by Sea Ordinance (Chapter71) which provides that an outward bill of lading is prima facie evidenceof tho receipt by the carrier of the goods as therein described in accordance•with paragraphs (a), (6) and (c) of Rule 3 does not apply to goodsshippedfrom Iraq nor does it apply to a homeward bill of lading. Tho presentaction is not one by or against the signer of the bill of lading or the ownerof the ship. Tho bill of lading was given by tho signer to Mehta andnot to the defendants and I am unable to understand how the statementin it that 47,000 kilos were shipped can b© regarded as evidence againstthem. So far as the defendants are concerned that statement appearsto mo to bo hoarsay. There is no evidence before us that the plaintiffreceived only 47 tons. Rajaratnam, a clerk employed in the Customs,said that for the purpose of ascertaining the duty payable on the datesconsigned to tho plaintiff ho picked up four bundles at random andweighed them aud found that 2 bundles weighed 2 cwt. 10 lb. andthe other two 2 cwt. 11 lb. According to these test weights the weightof 960 bundles would be a little over 49 tons which is in excess of thequantity givon in P 7. Soyed Mohamed, the plaintiff’s clerk, said thatthe exact weight of tho 960 bundles received by the plaintiff appearsin the plaintiff’s books, but those books were not produced at the trial.The plaintiff has, in our opinion, failed to prove the damages sustainedby him, and wo have no alternative but to award him only nominaldamages which wo would fix at one rupeo.
We would, accordingly, substitute for the sum of Rs. 1,52“> in thedecree that has been ontored in the case tho sum of one rupee. Theappellant will be entitled to the costs of appeal. The parties will beartheir own costs in the District Court.
Gunasekaka J.—I agree.
Decree varied.
• * IS and 19 Victoria, c iti (1855) #. 3.