The plaintiff brought an admiralty action for recovery of USD 43,944 against the first defendant vessel, the Khalid Ibn Al Waleed, owned by the second defendant. The third defendant was the slot charterer, and the fourth defendant was the local agent of the third defendant. The plaintiff had entrusted its consignment of 41,450 m of polyester, valued at USD 41,851, packed in 277 rolls, and stored in a 20' container, to the defendants for carriage from Karachi, Pakistan, to Alexandria, Egypt. The defendants issued a bill of lading indicating that the consignment had been shipped on the Hammurabi, owned by the second defendant. Thereafter, the plaintiff submitted the original shipping documents to its bank for negotiation under a letter of credit opened by the buyer. Negotiation was refused because of discrepancies in the documents. While discussions in respect of the discrepancies were going on, the plaintiff came to know that its container has been removed from Alexandria to Ashdod, Israel. The consignee backed out of the contract. The plaintiff arranged for another buyer in the US and requested that the container be rerouted to Los Angeles. The defendant asked for demurrage/storage charges and the sale to the second buyer fell through. The plaintiff found a third buyer in Alexandria and requested the defendants to ship the container from Ashdod to Alexandria, and to withdraw their demand for demurrage/storage charges. There was no response. The plaintiff abandoned the consigment and brought this action.

The defendants jointly filed a written statement of objection, arguing that the second defendant, the owner of the first defendant vessel, had no privity of contract with the plaintiff. Therefore, the plaintiff had no cause of action in personam against the second defendant, specifically in terms of s 4(4) of the Admiralty Jurisdiction of High Courts Ordinance 1980 (the Ordinance), and that, since the writ and warrant of arrest were not served on the first defendant vessel, jurisdiction in rem was never invoked. Hence, the suit, if any, was in personam only against the third defendant, and the plaintiff's claim did not arise from any of the causes mentioned in s 3(2) of the Ordinance. As to the merits, the defendants stated that the consignee refused delivery because of its bad experience with another shipment sent by the plaintiff. In such circumstances, the third defendant's Alexandria agent removed the container from Alexandria to a place of its convenience. The third defendant fulfilled its responsibility by making the container available for delivery at the given destination. Hence, the third defendant was entitled to demurrage/storage charges.

Held: The Court has jurisdiction to hear the claim but the suit is dismissed on the merits.

The defendants have argued that no action in rem was available as the third defendant had entered into a slot charter with the second defendant for the MV Hammurabi, which was not beneficially owned by the third defendant. Therefore, the plaintiff's action against the first defendant, ie the sister ship Khalid Ibn Al Waleed, was not available. The plaintiff submitted that the first and second defendants had defended the factual position regarding shipment and offloading of the consignment, and at no stage had they stated that they had no involvement in that factual position. The plaintiff also stated that the charterparty was the key document to judge the responsibility of the first and second defendants, but despite questions in evidence, they had failed to file that document; hence, an adverse conclusion should be drawn by the Court. In these circumstances, keeping in view s 4(4)(h) of the Ordinance, as well as the factual position, showing that control of the MV Hammurabi remained with the second defendant, an action in rem against the first and second defendants is maintainable on the basis of the claim in personam against the second defendant.

It is admitted that the matter in dispute pertains to an agreement relating to carriage of goods in a ship. By virtue of s 3(2)(h) of the Ordinance, the matter falls within the jurisdiction of the Court: 'Any claim arising out of any agreement relating to the carriage of goods in ship or to be used or hire of ship'. This is a very wide clause bringing all matters related to shipment and carriage by sea within the admiralty jurisdiction. Hence, the suit is maintainable.

From the evidence of the parties, it is on record that the consignment was discharged at the port of Alexandria on 6 June 2000. There was nobody to receive it, apparently because there were discrepancies in the contract documents. Therefore, the consignment remained there, and thereafter was transferred to a place of convenience of the defendants. Although the third defendant has claimed demurrage/storage charges, the plaintiff has not been able to establish that they were on the higher side. The shifting of the consignment from Alexandria to Ashdod was basically due to the fault of the plaintiff as its buyer backed out; otherwise, all of the incidents would not have happened. Since the root cause lies with the plaintiff, the claim of demurrage/storage charges does not give a cause of action to the plaintiff. On the basis of the findings above, the plaintiff has not suffered any loss due to the fault of the defendants. The plaintiff is not entitled to any relief, and the suit is dismissed.