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High Court of New Zealand Decisions |
Last Updated: 31 December 2012
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV 2002 404 3215
BETWEEN NEW ZEALAND CHINA CLAYS LIMITED
First Plaintiff
AND IMERYS MINERALS JAPAN KK Second Plaintiff
AND TASMAN ORIENT LINE C.V.
Defendant
CIV 2002 404 3216
AND BETWEEN NEW ZEALAND DAIRY BOARD First Plaintiff
AND NESTLE KOREA LIMITED Second Plaintiff
AND CHONG KUN PHARMACEUTICALS Third Plaintiff
AND NIPPON NZMP LIMITED Fourth Plaintiff
AND MAEIL NEW ZEALAND CHEESE COMPANY LIMITED
Fifth Plaintiff
AND DONG SUH FOODS CORP Sixth Plaintiff
AND CHOHEUNG CHEMICAL IND. CO.
LIMITED Seventh Plaintiff
AND TASMAN ORIENT LINE C.V.
Defendant
NZ CHINA CLAYS LTD AND ANOR V TASMAN ORIENT LINE C.V. HC AK CIV 2002 404 3215 31
August 2007
CIV 2002 404 3217
AND BETWEEN ALLIANCE GROUP LIMITED First Plaintiff
AND ZHEJIANG FUBANG GROUP CO.
LIMITED Second Plaintiff
AND SHIN YANG LEATHER CO. LIMITED Third Plaintiff
AND SHIN OH CO. LIMITED Fourth Plaintiff
AND DSI COMPANY LIMITED Fifth Plaintiff
AND KWANG SUNG HIGH-TECH CO LIMITED
Sixth Plaintiff
AND ONG SEO TRADING CO LIMITED Seventh Plaintiff
AND NEW ASIA TRADING CO. LIMITED Eighth Plaintiff
AND TASMAN ORIENT LINE C.V.
Defendant
CIV 2002 404 3218
AND BETWEEN PPCS LIMITED First Plaintiff
AND SUNGRIM ENTERPRISE CO.
Second Plaintiff
AND KWANG SUNG HIGH-TECH CO LIMITED
Third Plaintiff
2
AND SHINYANG LEATHER CO LIMITED Fourth Plaintiff
AND SHIN OH CO LIMITED Fifth Plaintiff
AND SUNG JIN NEO TECHNO LIMITED Sixth Plaintiff
AND TASMAN ORIENT LINE C.V.
Defendant
Hearing: 9, 10, 11, 14, 15, 16, 17 and 18 May 2007
Counsel: Philip Rzepecky with Matthew Flynn and Vanessa Orange for plaintiffs
Bruce D Gray QC with Neil Beadle for defendant
Judgment: 31 August 2007 at 4:00pm
JUDGMENT OF WILLIAMS J
This judgment was delivered by
Hon. Justice Williams on
31 August 2007 at 4:00pm
pursuant to Rule 540(4) of the High Court Rules
...................................
Registrar/Deputy Registrar
Date: ...........................
C There will be a telephone conference with counsel on Tuesday, 30 October
2007 at 9:00am to discuss costs and the future conduct of the case unless counsel advise beforehand that no such conference is required.
3
TABLE OF CONTENTS
Paragraph
Issues and Introduction [1]
The pleadings summarized [6]
Facts
(1) Tasman Pioneer [17] (2) Voyage to anchoring [26] (3) After Anchoring [46] (4) Salvage [58] (5) Photographs [71]
Evidence
(1) Captain Hernandez’s actions [78] (2) Salvage [84] (3) Naval Architects [104]
Submissions:
(1) Plaintiffs [126]
(2) Defendant [156]
Discussion:
(1) What should or would those actually or notionally involved have done, and when? [181
]
(2) Were Captain Hernandez’ actions in the
“navigation” or “management” of the ship? [215]
(3) For Art 4 and R 2(a) of the Hague-Visby Rules to exempt
carriers must any act, neglect or default in the navigation [227]
and management of the ship be bona fide for those purposes?
(4) Vicarious Liability [243] (5) Unseaworthiness [250] (6) New Zealand Dairy Board claim [296]
Result [306]
ANNEXURES
Annexure 1 Map of relevant part of Japan and most of the towns mentioned in this judgment.
Annexure 2 Relevant part of British Admiralty Chart 651/Japan Chart 151
Annexure 3 Part of Japanese chart showing actual anchorage
Annexure 4 Starboard bow c 0920 hrs Annexure 5 Starboard bow c 1530 hrs Annexure 6 Port side c 1550 hrs Annexure 7 1218 hrs photograph
Issues and Introduction
[1] The plaintiffs all had interests in cargo stowed on deck on the ship Tasman Pioneer when she suffered a casualty entering the Inland Sea of Japan at 0255 hrs local time on 3 May 2001.
[2] On that date, Tasman Pioneer was owned by Rimba Shipping Co Ltd, time chartered on an NYPE form to Tasman Orient Line (Cyprus) Ltd and sub-time chartered to Tasman Orient Line CV, the defendant. a Dutch corporate partnership. The time charter and sub-time charters were “back to back”. Throughout the period with which this case is concerned, Tasman Pioneer was managed by Technomar Shipping Inc of Athens, Greece.
[3] Put very broadly just to set the scene, cargo interests assert that had Captain Hernandez, master of the Tasman Pioneer, notified relevant authorities of the casualty soon after it occurred, their on-deck cargo would have suffered no damage as salvors would have been able to save it from being wetted or inundated. The plaintiffs assert delays in Captain Hernandez notifying the authorities were such that it was not until 1000 hrs on 3 May 2001 that salvors were engaged. Had they been deployed earlier, their on-deck cargo would have been saved.
[4] The claims in CP461/02, 462/02, 463/02 and 464/02 are USD$11,252.48, USD$498,737.26, USD$1,602,945.72 and USD$1,106,334.04 respectively, a total of USD$3,108,545.80. By the time the hearing ended, there was no issue as to the quantum of the claims. For reasons which will appear, it is necessary to give separate consideration to a claim in CP462/02 by the New Zealand Dairy Board for USD$187,301.87 for dairy products stowed in refrigerated (“reefer”) containers damaged by heat through lack of continuous generator power to the integral refrigeration units.
[5] Though quantum is not an issue the claims may require further hearing given General Average has been declared, there are claims for salvage following a London arbitration, and Tasman Orient claims the benefit of a tonnage limitation fund
constituted under the Maritime Transport Act 1994 – itself the subject of an earlier judgment in this claim (The “Tasman Pioneer” [2003] 2 Lloyds Rep 713 also reported sub nom Tasman Orient Line Ltd CV v Alliance Group Ltd [2004] 1 NZLR
650). Some original plaintiffs have settled which also affects the quantum of the limitation fund available.
The pleadings summarised
[6] The plaintiffs bring conventional cargo claims alleging breach of bailment and contract under bills of lading issued by Tasman Orient. They also assert that, at the time of the casualty, the ship was unseaworthy.
[7] Tasman Orient challenges the plaintiffs’ claims on causation and asserts it is protected by the exemption contained in Art.4 R 2(a) of the Hague-Visby Rules (strictly, the Amended Hague Rules) incorporated into New Zealand law by s 209 of the Maritime Transport Act and the Fifth Schedule. Art 4 R 2(a) reads:
(a) Act, neglect or default of the master mariner, pilot or the servants of the carrier in the navigation or in the management of the ship.
[8] As is to be expected, the pleadings by all plaintiffs followed a similar pattern, with the issues thus far identified being principally derivable from the plaintiffs’ replies to the statements of defence and Tasman Orient’s further defence to the replies.
[9] Taking the NZ China Clays and Imerys Minerals Japan KK claim as a template, the second amended statement of claim pleaded the plaintiffs’ positions and asserted they were both parties to the bills of lading with rights of suit vested in overseas plaintiffs under the Mercantile Law Act 1908 s 13B.
[10] Initially, Tasman Orient put all plaintiffs to proof as to their title to sue but by the end of the hearing it was accepted that all plaintiffs were entitled to sue and accordingly that aspect of the defence was not pursued.
[11] Then, after pleading the brief factual background, the plaintiffs set out their claims against Tasman Orient in breach of contract or bailment under the bills of lading and the Hague-Visby Rules. The plaintiffs particularly rely on Arts 3(1)(2) of the Hague-Visby Rules and assert Tasman Orient failed to exercise due diligence to make Tasman Pioneer seaworthy, an allegation particularised by reference to claimed corrosion and wasting, later considered in detail. The plaintiffs plead Tasman Orient failed to care for their cargo properly, subjected it to seawater damage and failed to deliver it in good order and condition. Tasman Orient originally relied on additional provisions in the bill of lading but these fell away by the completion of the hearing and, while acknowledging the carriage was subject to the Hague-Visby Rules, it claimed to be entitled to rely on Art 4 R 1 exempting carriers and the ship from liability arising from unseaworthiness (unless caused by want of due diligence on the part of the carrier “to make the ship seaworthy”) and Art 4 R 2. It also denied it was a bailee for reward.
[12] The parties each assert that the burden of proof of the defendant’s entitlement to either or both of those exemptions lies on the other. That became a trial issue.
[13] The plaintiffs’ third cause of action was in negligence, asserting Tasman Orient owed them a duty to exercise a carrier’s normal skill and care. They plead res ipsa loquitur. Again, the defendant asserted its duties were limited by the bill of lading and the Hague-Visby Rules and denied res ipsa loquitur applied. It also raised its right to limit its liability for claims arising out of the limitation decree.
[14] The plaintiffs’ replies to the defence cited the Hague-Visby Rules and particulars provided by Tasman Orient and expanded to a significant degree on the factual allegations including asserting that Captain Hernandez’s actions were, in the circumstances on 3 May , reckless before the grounding and that he misconducted himself in a number of particularised ways following it. As a result, the plaintiffs assert, Captain Hernandez’s actions and omissions were neither made bona fide nor for the navigation or management of the ship and his misconduct caused more extensive flooding and damage than would otherwise have occurred.
[15] Tasman Orient’s defence to the reply noted the defendant “accepted that the grounding was caused by an act, neglect or default in the navigation of the ship by Captain Hernandez”. That was “sufficient to bring the grounding within the exemption contained in Art 4 R 2(a) of the Hague-Visby Rules”. Most of the factual allegations were admitted but the allegation that Captain Hernandez’s actions were reckless was denied. Some actions after the grounding were also admitted.
[16] The plaintiffs particularised their allegation of the vessel’s unseaworthiness by saying the ship was unseaworthy at voyage commencement because of particularised corrosion and at the casualty. As a result, parts of the ship flooded when they should have remained watertight and the ship sank further and faster than would otherwise have been the case. That led to their cargo damage. All of that is denied.
Facts
(1) Tasman Pioneer
[17] As that review of the pleadings shows, by the time of the hearing much of the factual background was not contested.
[18] Tasman Pioneer was built as the Larch by the Hayashikane yard in Japan in
1979 as yard number 896. Named the Pioneer Ark on 23 November 2000, the date of the NYPE time charter, she was re-named Tasman Pioneer though, as will be seen, the circumstances in which and the time at which that occurred became a matter of contention. She was a typical tween deck, multi-purpose general cargo vessel built to NK Class Rules but under Germanischer Lloyd Class at the casualty. Her length overall was 166m, beam 27m and depth 14.1m. She had a service speed of about 16 knots.
[19] Navigation, accommodation and engine spaces were arranged aft of four cargo holds. The foremost hold, no.1, was in the fo’c’sle deck with the remainder in the main deck. Evidence differed slightly as to her gross and net tonnage but witnesses agreed she was 21,115 tonnes deadweight at extreme summer time draft
of 9.8175m. There were crane houses and gantries between the holds. Because it was used as a reference point in interpreting the photographs of the ship in semi- flooded state, it is pertinent to note that forward of no.1 hold was a gantry portal cum light and communication tower which the expert witnesses described as a “goal-post like structure” containing a crosstree and built approximately between frames 200 and 205 slightly forward of the mid-point of the fo’c’sle deck. All upper and lower cargo holds were divided by tween deck hatches. No.1 hold had a single and nos. 2,
3 and 4 holds twin main deck and tween deck hatches with the hatch covers and fo’c’sle deck fitted to carry 20 and 40 foot containers.
[20] The bridge had a conventional range of equipment for an ocean-going vessel including GPS, two radars, an automatic pilot with off-course alarm, course recorder, two VHF radios and an electro-magnetic speed log.
[21] Tasman Pioneer was double bottomed extending from aft to the forward end of the no.1 hold with deep tanks arranged between the tanktop and tween decks at the fore end of holds 3 and 4 and side tanks between the tanktop and tween decks in hold 3 and in J format in hold 2. The deck crane houses included access hatches to cargo holds and various cargo hold bilge pipes and a double-bottomed tank sounding pipe. Mr Boyd, a naval architect called by Tasman Orient, said the ship had a total water ballast capacity of 6330.39mt carried in the forepeak tanks (“FPT”) nos. 1C (“centre”), 2P&S (“port and starboard”), and 4 P&S, side tanks amidships (“SWBT”) no.3 P&S and the aft peak tank (“APT”) with freshwater totalling 282.18mt carried in aft tanks (“FWT”) nos. 1 and 2 P&S. Fuel oil grade C was carried in the double- bottomed tanks (“FOT”) nos. 2 P&S, 3 P&S and 4C while grade A was carried in the engine room FOT nos. 5 P&S and 6S with a combined total of 2006.76mt.
[22] Utilising the capacity table in the vessel’s Trim & Stability (“T and S”) Book, Mr Boyd noted the hold grain capacities, at 98% of moulded volume for holds 1, 2, 3 and 4, totalled 34,083.55m3.
[23] Both Mr Colman, the naval architect called by the plaintiffs, and Mr Boyd discussed the ship’s pumping capacity.
[24] Drawing on the ship’s General Arrangement and on Tasman Orient’s response to interrogatories which varied from it, Mr Colman accepted the ship had two main pumps which could be applied to the bilge and ballast tanks and could thus pump water from the cargo holds through bilge wells, with each having a capacity of
180 tonnes per hour with a zero head and up to 450 tonnes per hour with a 30m head. Their total capacity working together through the bilge piping was likely to have been about 300 tonnes per hour, that being an approximation based on the 150mm diameter of the bilge main and the maximum likely speed of about 5m per second at which water could be pumped with the pumps working in parallel.
[25] Mr Boyd’s view was that with the two pumps working in parallel at zero head the capacity was about 250mt per hour and about 615mt per hour on a 30m head. Because the operational heads for pumping water from the ship after the grounding would not, in his opinion, “have been much above zero”, Mr Colman thought the capacity of the two pumps would be about 200 tonnes per hour if the bilge system was adequate, but about 300 tonnes per hour when working together with the limitation of the bilge main diameter. Mr Boyd calculated that “with rapid ingress and correspondingly greater amounts of floodwater, a higher rate should be used” even towards the top of his estimated capacity.
(2) Voyage to Anchoring
[26] After a somewhat eventful voyage, later detailed, from New Zealand, Tasman Pioneer left Yokohama, Japan, at about 2000 hrs on 1 May 2001 bound for Busan, Korea – about 642nm - intending to sail west along Japan’s Pacific coast and then through Bungo Suido, the Japan Inland Sea – one of the world’s busiest shipping areas according to Captain Goodrick - and Kanmon Strait before crossing Korea
Strait to her destination.1 Her e.t.a. was about 1700 hrs on 3 May. Mr Gallano, her
Second Mate, said her departure drafts were 7.72m forward and 7.78m aft though when Mr Colman modelled the ship’s loading condition on departure from the stowage plan, the loading computer printout and assessments of the ballast and fuel tank contents, he found minor discrepancies between Mr Gallano’s reading, the
1 Annexure 1 is a map of the relevant part of Japan and most of the towns mentioned in this judgment.
ship’s log and his computer model of her stability. They were, however, insignificant in a vessel of her weight and he concluded that she had “substantial reserves of stability in the intact condition”.
[27] It appears Captain Hernandez was under a certain amount of pressure from Tasman Orient and Technomar to maintain his schedule: “your best speed is requested”. One port had already been deleted. This was a route on which Tasman Orient hoped to build up a regular liner service. Kanmon Strait is a narrow passage with significant current. Compulsory pilotage is required. The master was concerned to arrive at the Strait at a favourable point of the tide.
[28] About 1000 hrs on 2 May 2001 the master realised the ship was behind schedule and decided that, rather than passing west of Okino Shima, the usual route for vessels entering Bungo Suido from the south, he would shorten steaming time by
30-40 minutes by taking Tasman Pioneer between the island of Biro Shima and the promontory of Kashiwa Shima, the south-western extremity of the island of Shikoku.2 He told Mr Gallano and the third mate, Mr Cisudol. They opposed taking such a restricted passage at night but Captain Hernandez insisted. He confirmed his direction about 2200 hrs on 2 May. Although the passage is narrow, he later told Japanese coastguard investigators that:
I have experienced passage through the channel several times in the past when I was on board a vessel of about 4000 gross tones and I also sailed once southward (through the Channel) on board my vessel.
[29] Captain Goodrick, an experienced master mariner called by the plaintiffs, acknowledged that the Japan Pilot (Vol.II 7th ed. 1979 p171, l 68) says: “The channel between Okino Shima and Oshime Hana is deep and is used by large vessels” but that may refer to the channel west of Biro Shima, not that to the east chosen by Captain Hernandez, and in any case Captain Goodrick cautioned against too literal a reliance on the Japan Pilot’s reference to “large vessels”: that
2 Annexure 2 reproduces the relevant part of British Admiralty Chart 651/Japan Chart 151 of the area under discussion. Saki = point: Wan = bay or gulf: Shima = nose.
description may not have been intended to encompass vessels as large as Tasman
Pioneer.
[30] After changing course to 278o at 0140 hrs on 3 May 2001, as directed the master was woken at 0215 hrs. He took command on the bridge at approximately
0225 hrs.
[31] At 0250 hrs the master changed course to 308o to transit the passage. At that stage Tasman Pioneer was making 15 knots into a nor’wester of about 36 knots and a 1m swell. The sky was completely dark with visibility down to about two miles and with Biro Shima slightly on the port bow about 1.2 miles distant. About two minutes after the course change, Captain Hernandez , who was operating the starboard no.1 radar, lost all images. He instructed Mr Gallano to reconfigure it. Whilst he was doing so, at about 0253 hrs, he heard Captain Hernandez order “hard port” and shortly thereafter, when Mr Gallano reconfigured the radar, it showed Biro Shima at a distance of only about four cables (800 yards) on the ship’s port side. He checked from the port wing and shouted to the master “Go starboard”. Captain Hernandez gave the order to a deckhand, Mr Fadley (also ‘Fadori’) who was steering manually but after about five seconds – and about two minutes after the order “hard port” – the crew felt an impact which Mr Fadley described as two impacts from the bow which were “like grinding vibrations” each of about 2-3 seconds duration with a similar interval between.
[32] Though, of course, neither master nor crew knew it immediately, the outer hull forward suffered significant damage in the impact. Photographs following dry dock inspections and the naval architects’ calculations showed significant damage to the forepeak, stem plate, keel plates and strakes involving flooding of the FPT, WBTs no.1C and no.2, principally to port, though the starboard tanks were also damaged, and extending forward from about frame 156, approximately the middle of no.2 cargo hold to frame 215 about mid-point of the FPT. Seawater would have been unlikely to have gained ingress into the holds had it not been for the fact that nos. 1 and 2 cargo hold bilge wells were also damaged in the casualty.
[33] However, even though the crew were unaware of the extent of the damage, they must have known almost immediately that it was highly likely to have been significant. Not only were the crew’s descriptions of the ranging impact with the sea bottom graphic, but Mr Gallano told investigators that from a speed of 15 knots, the
22,000 tonne Tasman Pioneer was immediately slowed to 6 or 7 knots. An engineer, Mr Trazona, said the main engine revolution rate of about 120 rpm at cruising speed dipped as a result of the impact to about 90 rpm, gradually returning automatically to
120 rpm over the next 5-7 minutes.
[34] Further, within what Mr Gallano thought was about two minutes after impact, the ship developed a list to port that grew to about 3o after five minutes and about
8o-10o in 5-10 minutes. As a result, all hands were roused, WBT 3S and 4S were
flooded to correct the list and pumping operations commenced. WBT 2P was found to be flooded. Shortly afterwards it was found that nos. 1 and 2 cargo holds were also taking water and further pumping was undertaken.
[35] The defendant admits that following the grounding Captain Hernandez continued to steam at full speed, failed to alert the Japanese Coastguard or seek other assistance, and failed to report the location of the grounding to the coastguard or, for some hours, to Technomar. Captain Goodrick took the view:
When a ship the size of the Tasman Pioneer collides with the land or a rock to the extent that it is stopped on its course, then all aboard know that they must immediately deal with a very serious crisis. Master Mariners such as Captain Hernandez and the officers on board the Tasman Pioneer are highly trained professionals. The risk of collision, grounding, fire or some other catastrophe is always a possibility when ships put to sea. Accordingly, a competent well trained master mariner such as Master Hernandez makes very deliberate decisions after a grounding which should always firstly be in the interests of lives at risk and then for the safety of the vessel and its cargo.
[36] Captain Goodrick said that following such a grounding the steps any prudent master would undertake include notifying the Japanese coastguard of the incident with the ship’s position and condition. Not only was that common-sense, such actions form part of a mariner’s training under SOLAS and ships’ safety management systems. Though he disagreed on the immediacy of the obligation to report, Captain Landelius, a master mariner called by Tasman Orient who became
the Specialty Casualty Representative (“SCR”) for this casualty, did not disagree with Captain Goodrick’s view as to a master’s obligations after a casualty.
[37] It therefore becomes pertinent to consider what Captain Hernandez did and, to the extent it is in evidence, why.
[38] In the days immediately after the casualty, the coastguard interviewed all members of the crew, several on a number of occasions.
[39] That included Captain Hernandez who said, on 8 May, that when the radar image disappeared so the ship’s accurate position was unknown in the narrow channel, it :
“... threw me into a panic and, under the impression that I still have sufficient distance to Biro Shima, I gave an order to the able seaman “hard port”.”
[40] On 14 May he repeated that statement saying that he “gave the order hard port out of hope to get out of this narrow and dangerous water” and that “if the vessel had not ported and sailed straight on the course, she could have safely passed without causing the recent accident”. Once an 8-9o list to port developed about five minutes after the grounding, crew members reported to him that WBT nos. 1P and
2P were flooded as a result of which he gave orders to flood WBT 3 and 4S and to pump out WBT 2P. That corrected the list to about 2o. He continued :
Around one or two minutes after the shock of grounding, I checked the ship’s position by radar and I learned that she touched bottom somewhere around Biroh Shima. Following that, I decided to anchor in waters between Yura Misaki and Yoko Shima, as you know, and actually we traveled until reaching there without reducing speed and then anchored. 3
The reason I did not go to Sukumo Wan (cove) or somewhere nearby, is that since there is a need to change fuel over from Bunker [possibly ‘Fuel’: translator] Oil C to Bunker Oil A and for that operation it takes 30 to 40 minutes, I decided I would go to south of Yura Misaki.
[41] A number of comments require to be made concerning Captain Hernandez’s brief description of what occurred between the grounding and anchoring.
3 Annexure 3 is part of a Japanese chart showing Tasman Pioneer’s actual anchorage.
[42] The first and most important is that, prior to the crew being taken by coastguard patrol boat from Tasman Pioneer after anchoring, Captain Hernandez, possibly sensing loss of a lengthy career at sea, instructed the crew to lie to the coastguard investigators with a view to persuading them the ship passed west of Okino Shima and the impact had been with an unidentified floating object. The crew, initially at least, followed his order to the point where Mr Gallano, on Captain Hernandez’s specific instructions, erased the course actually sailed from the ship’s chart and substituted a false course purporting to show Tasman Pioneer passing west of Okino Shima. It was only in subsequent interviews that the crew acknowledged to the investigators what actually happened. That led, in due course, to Captain Hernandez following suit (and his later prosecution in Japan).
[43] Secondly, the evidence was that the conditions during Tasman Pioneer’s transit from Biro Shima to the anchorage remained as previously so the ship, despite the damage and the water in her tanks and holds, was proceeding at 15 knots, its top speed, into a north-west near gale of some 35 knots with swells estimated at around
2m in the more exposed parts of the passage.
[44] Thirdly, Captain Goodrick estimated the distance steamed between grounding and anchorage at about 22 nm. The ship anchored, according to Mr Gallano, at
0530 hrs. That may be wrong. The ship’s bell book for 3 May showed that following an “emergency manoeuvre” the ship’s engines were at full speed ahead until 0455 hrs, then astern, and then stopped at 0503 hrs. That reads like an anchoring sequence.
[45] Fourthly, although the evidence as to exactly what occurred and when is somewhat imprecise, it seems the crew continued to take soundings or ullage in the sounding pipes to the holds and bilges and may have continued to operate the ship’s pumps throughout the rest of the voyage. Mr Fadley said when he first went up to the bow a few minutes after the collision “water was squirting from the no.2 ballast tank air relief pipe” though he found no leaks into the FPT at that juncture but, after sounding, established there was already a lot of water in nos. 1 and 2 cargo holds. The list to port increased and it “looked as though the bow was sinking”. Mr Trazona operated the ballast pump to pump seawater into WBT 2S and 4S and
then, about four minutes later, to pump seawater out of the WBT 2P. The ship was listing 5o to port after anchoring.
(3) After Anchoring
[46] Tasman Pioneer never contacted the coastguard at any time. Coastguard records show it first learned of the casualty when it received a telephone call at
0715 hrs on 3 May from a passing boat advising of a vessel sailing north through Bungo Suido listing 5-10o. That caused the coastguard to send a patrol boat which came upon Tasman Pioneer at anchor about 0910 hrs “with her aft part raised and trimmed by the head” and “inundated in tanks etc in the forward section ... increasing its list to port”.
[47] Captain Hernandez told investigators that “after anchoring, I first contacted my company” as it required. That communication was a telex sent to Technomar. The exact time and date it was sent remains unclear. The telex is dated “01-05-02
20:31-20:34 S&F” (Store Forward) and records its delivery. Captain Goodrick made the point that it is difficult to align that date or timing with the time of the casualty or time differences between Japan and Greece. The likelihood is the telex was, as Captain Hernandez said, sent after anchoring but how long cannot be determined, though it must have been before 0850 hrs, the time Technomar first contacted Nippon Salvage. It read:
1 May 2002 20:31-20:34 hrs
URGENT URGENT URGENT
REGRET TO INFORM VESSEL DEVELOP EXCEESIVE [SIC] LIST AT
0340H/3RD. SO FAR FOLLOWING PRESENTLY WAS OBSERVED:
1. HOLD BILGE NO.2 HAD MUCH WATER AND FOUND AT 0430H W/ ABT. 3 METERS WATER I HOLDS.
2. BALLAST NO.2 PORT HAD BEEN FOUND TO HAVE MORE WATER AND SUDDENLY BECOME FULL.
3. STILL CHECKING ALL TANKS AND WILL REVERT.
4. ALSO OUR HOLD NO.1 HAD BEEN FOUND TO HAVE WATER.
[48] In addition to the question of the telex’s timing and the delay in notifying management, Captain Goodrick noted the telex gave no indication of the cause of the damage and understated it.
[49] A telex from Technomar to the ship dated 3 May 2001 at 2:08pm, presumably Greek time, said:
FURTHER TELEPHONE CONVERSATION PLEASE NOTE THAT WE CONTACTED SWEDISH CLUB REPRESENTATIVES IN TOKYO WHO WILL CONTACT NIPPON SALVAGE TO ARRANGE A TUG BOAT TO COME TO YOUR POSITION ... “
going on to detail precautions Captain Hernandez should take which echoed those
Captain Goodrick said all masters should take as soon as possible after a casualty.
[50] A further telex, this time sent by Technomar on 3 May 2001 and timed at
0411 hrs said:
SALVAGE TUG “SEIHA MARU” OF NIPPON SALVAGE LEAVING MOGI [sic.] SHORTLY TO COME TO YOUR ASSISTANCE.
IF YOU ARE REQUESTED BY SALVAGE MASTER YOU ARE AUTHORIZED TO SIGN LLOYD’S OPEN FORM.
SALVAGE TUG REQUIRES 1.5 HOURS TO MOBILIZE AND 7 HOURS TO REACH YOUR POSITION.
PLS INVESTIGATE POSSIBILITY TO RUN VESSEL AGROUND WITH FORWARD PART TO AVOID SINKING IS FORWARD TRIM INCREASE AND ADVISE BY PHONE.
and on the same day, timed at 0452 hrs, Technomar telexed Captain Hernandez that it had contacted the charterers and Tokyo agents in the following terms:
ADVISED BY MASTER THAT AT ABOUT 2000 HRS GMT 02/05 FELT A SUDDEN VIBRATION AND LATER THE VESSEL TOOK A LIST.
HE SOUNDED THE TANKS AND FOUND THAT WATER WAS ENTERING NO.1 DOUBLE BOTTOM. HOLD NO.1, SIDE TANKS NO.3 PORT AND HOLD NO.2.
THE MASTER BELIEVES THAT VESSEL HIT AND UNIDENTIFIED OBJECT.
AT ABOUT 2100 HRS GMT 02/05 THE VESSEL ANCHORED AT POSITION LAT. 32 59, LONG: 132.24
? OF WATER IS INCREASING AND PRESENT DRAFTS ARE: FORE: ABOUT 14.0 METERS
AFT: ABOUT 5.6 METERS.
ADVISED JAPANESE COAST GUARD OF INCIDENT. NO POLLUTION
ADVISED HULL UNDERWRITERS WHO ARRANGED THE SALVAGE TUG ‘SEIHA MARU’ OF NIPPON SALVACE TO PROCEED TO THE VESSEL’S POSITION AND RENDER ASSISTANCE ON LLOYD’S OPEN FORM TERMS.
[51] Captain Kuroki, salvage master and deputy general manager of the Moji 4 branch of Nippon Salvage, said that on 3 May the company’s large tug Seiha Maru No.2 and the salvage barge Masakuni were at the Moji base with a smaller tug, Hayashio Maru No.2, on station at Imabari 5 in the Inland Sea. Nippon Salvage is a large operation on watch 24 hours per day 365 days per year at Moji.
[52] At 0830 hrs on 3 May 2001, a national holiday in Japan during Golden Week, a Nippon Salvage Moji staff member was telephoned by a dive company based in Kokura which had heard of a casualty in Bungo Suido. That was followed by a telephone call at 0850 hrs from Mr Glynos of Technomar. The particulars of the casualty known to Technomar were advised. Mr Glynos was specifically told Seiha Maru No.2 and its crew were immediately available. The services of the tug and its crew were repeated in a telephone call to Mr Glynos at about 0910 hrs. Nippon Salvage said they could reach Tasman Pioneer in about seven hours steaming from Moji. Captain Kuroki recorded Mr Glynos telling the general manager in the second conversation that the “condition of the vessel was reportedly not serious” and requested an “... offer on another contractual basis, such as daily hire”. In a further telephone call to Mr Glynos at 0950 hrs Nippon Salvage was given the vessel’s drafts and told she was “heavily by the head”. Some details of her cargo and Japan agents were given. By then, Nippon Salvage had commenced mobilizing salvage
4 Moji is on Kyushu in the Kanmon Strait
5 or Imbari
hands. At 1000 hrs a Nippon Salvage director, Captain Yano telephoned Captain Landelius – a salvage master employed by the Swedish Club, the P & I Club involved - and told him the ship was in a “serious condition according to reports we received from Japanese Coastguard” with nos. 1 and 2 cargo holds flooded, only about 2m freeboard on the fo’c’sle deck and with a 5-6m trim by the head. A Lloyds Open Form (LOF) 2000 “no cure–no pay” salvage agreement was reached at
1000 hrs on 3 May in that conversation.
[53] Because this was regarded by Nippon Salvage as a “severe emergency”, Captain Yano directed full mobilization of the Seiha Maru No.2 and the Hayashio Maru No.2 and their crews but also directed Captain Kuroki to travel by road to the town nearest the casualty and be ferried to the ship by coastguard patrol boat.
[54] Captain Kuroki and three others, including a diver, left Moji by car at 1150 hrs for Beppu 6 to embark on a coastguard patrol boat and get to the casualty as quickly as possible. They were delayed with holiday congestion on the roads.
[55] Nippon Salvage also arranged for the harbour tug Arita Maru to leave Oita on the eastern tip of Kyushu at about 1110 hrs. It is the nearest port to the casualty with available tugs.
[56] Seiha Maru No.2 left Moji fully laden with additional salvage equipment and divers at 1125 hrs. Hayashio Maru No.2 left Imabari with salvage equipment five minutes later.
[57] Arita Maru arrived off the casualty at 1450 hrs reporting to Captain Kuroki, that “the seawater was cutting the middle way of no.2 cargo hold”. That is the way Captain Kuroki recorded it in both his daily site reports and in his salvage diary. However, because Tasman Orient placed significant reliance on it, it should also be noted that when Captain Kuroki signed his witness statement on 10 October 2002, probably for the Japanese Marine Accidents Inquiry Agency, he said that the Arita Maru’s report was to the Moji branch of Nippon Salvage that “the casualty was
6 Beppu is on the coast of Kyushu, about 5 miles west of Oita.
heavily down by the head such that the seawater was cutting the mid part of no.2 cargo hold”.
(4) Salvage
[58] Captain Kuroki and the three salvage hands left Beppu on a coastguard patrol boat at 1635 hrs and arrived at the casualty at 1835 hrs. She was lying at anchor on a north-westerly heading into a Beaufort force 5 wind (8mps) with a 1.5m north- westerly swell. That reduced by 1928 hrs to 1.2m.
[59] Seiha Maru No.2 arrived at 1915 hrs. Hayashio Maru No.2 arrived at
2120 hrs.
[60] Salvage hands went aboard to find the engine room still in order and Tasman Pioneer’s generators running. At 2000 hrs de-watering the no.2 cargo hold began using three 75mm diameter gasoline pumps with an electric submersible pump of the same diameter operating from 2040 hrs and with the casualty’s pump switched from de-watering the FPT to the no.2 hold at 2047 hrs.
[61] Divers ascertained the shell plating was fractured over an area of 5-10m from the port bilge strake leading to the bottom of the nos. 1 and 2 cargo holds with the fracture about 15m long and 40cm wide. There was another ‘u’ shaped fracture about 3m x 2m and several smaller fractures of about 1m x 40cm.
[62] At about 2200 hrs inspection of the no.3 cargo hold found water leaking from a “pipe where it joined the forward bulkhead”.
[63] At about 2300 hrs Captain Yano, having been briefed on what had occurred, decided to invoke the SCOPIC clause in LOF 2000 with effect from 0600 hrs on
4 May.
[64] Ullages in the no.2 cargo hold from 2040 hrs showed the water level was increasing. De-watering the hold could not stabilize the increase in the ship’s trim by the head. All salvage hands left the vessel at 0030 hrs on 4 May, by which time the whole of the propellor and most of the rudder were above the surface with the aft
coaming of the no.2 cargo hold and the forward coaming of the no.3 cargo hold level with the surface starboard and port respectively, the trim about 23m (Captain Kuroki’s figure) down by the head and with the ship on a 4½-5o list to port.
[65] When work recommenced at 0720 hrs on 4 May the shoepiece was above water and ullage showed the hull had submerged a further 15cm. During the day air intakes to pipes were sealed. At 1240 hrs a 50mm diameter electric submersible pump was rigged in the no.3 cargo hold connected in series to a similar sized diesel pump to de-water that hold. Efforts to pressurize the FPT at 1402 hrs were suspended at 1427 hrs as “air could be seen to be leaking from the cap of the forepeak tank sounding pipe”. That was tightened and pressurization recommenced but at 1530 hrs air was noted “leaking from the watertight door of the bosun’s store on the fo’c’sle deck” which meant compressed air was “leaking from the forepeak into the void space and bosun’s store”. That work stopped at 1752 hrs and pressurization of the no.2 WBT (P) (S) similarly stopped at 1810 hrs, the latter as air bubbles could be seen coming through the submerged hatch covers. Captain Kuroki decided at that point that it was necessary to unload the containers on the nos. 1 and
2 cargo holds to raise the bow as much as possible and prevent containers floating away. De-watering of no.3 hold was stopped at 1920 hrs. The list had reduced to
2-3o.
[66] On 5 May salvors discovered the forepart had sunk more deeply in the water. Cranes and barges arrived and discharge of the containers began at 0920 hrs. Fifty- two containers were discharged that day with the salvage cranes and barges needing to manoeuvre to unload successively from opposite sides. Pressurizing of various tanks, particularly no.2 WBT (P), continued intermittently during the day. Tasman
Pioneer’s condition improved in that she now had a 2-3o starboard list, the shoepiece
was below the surface and the water line on the port and starboard sides was forward of the aft end of the no.2 cargo hold hatch coaming and at the forward end of the no.3 cargo hold hatch coaming respectively.
[67] But by 0545 hrs on 6 May the waterline on the main deck had moved 2-3m aft of its previous position. Pressurizing and discharging containers continued with
59 containers recovered that day. During the day, corrosion holes were found in the
air pipes for no.3 side WBT (F) (P) (S) which were sealed and water which was
85cm deep in the no.3 cargo hold was pumped out. Efforts to again pressurize the FPT between 1325-1400 hrs were initially frustrated as a diver inside the bosun’s store found air “coming through an electric cable joint leading to the void space below the bosun’s store”. That was plugged and pressurizing the FPT recommenced at 1405. Pressurization was suspended from about 1740 hrs onwards because of the deteriorating sea state and air leakage from the FPT. At 1533 hrs one of two generators was “stopped to save consumption of diesel oil” but Tasman Pioneer’s generator was “used to supply power to seven reefer containers on the deck of no.4 cargo hold by request of the vessel’s superintendent” and another generator “stored in a container on the deck of no.3 cargo hold ... was found operable”.
[68] On 7 May 2001 when the salvage hands boarded the casualty at 0702 hrs she was found to be further down by the head with the water level having moved aft by
2-3m from the previous day and the no.2 cargo hold hatches either floating or ajar. Pressurizing the various tanks, including the FOT, was recommenced at 0715. The no.3 cargo hold was de-watered by 0822.
[69] Some of the numerous adjacent pearl and other marine farms were relocated
– not without difficult negotiations and significant expense – in readiness for beaching the Tasman Pioneer, an operation which was accomplished on 10 May
2001 by 0900 hrs adjacent to an onshore riprap.
[70] Over succeeding days, salvors achieved the difficult, often hazardous, task of unloading cargo from the nos.1 and 2 cargo holds including containers, palletised cargo and cargo stowed loose. Once the vessel had been temporarily patched on site, beginning on 18 May 2001 she was towed first to Kanmon and then to the Onomichi dockyard for repairs.
(5) Photographs
[71] A number of photographs were produced showing Tasman Pioneer at various stages and since, as mentioned, the essence of the plaintiffs’ case is that their cargo would have been saved had Captain Hernandez alerted the coastguard,
owners/managers and salvors as soon as practicable after the grounding, an analysis of the main photographs is appropriate.
[72] The coastguard, whose principal interest in the casualty was saving life and pollution prevention not salvage, arrived at the casualty about 0910 hrs on 3 May and remained on station until 1550 hrs during which one of its judicial police officers, a Mr Igawa, took a series of photographs. He said that at about 0920 hrs the “bow deck was being pounded with waves that were going over the bulwark and ... the bulwark section (painted white) was above water level”. By 1530 hrs the “water level reached the upper section of the bow section bulwark [and] the bow deck was awash with seawater”. By about 1550 hrs the “bow section had sunk below water level and it was impossible to make confirmation of the upper section of the bow section bulwark”. Attached are copies of Mr Igawa’s photographs:
b) Starboard bow at approximately 1530 hrs; (Annexure 5)
c) Port side at approximately 1550 hrs. (Annexure 6)
[73] The most debated photograph was one taken at 12:18pm on 3 May (Annexure 7). Although the exact circumstances in which the photograph was taken were not in evidence it appears likely to have been taken by a coastguard helicopter. It was in digital format with the copies in evidence being photocopies of photocopies. The copy attached may have been enhanced for clarity.
[74] Though all countenanced caution in interpreting photographs of marine casualties for a variety of reasons including elevation, sea conditions and the like, the experts nonetheless drew certain tentative conclusions as to the state of the ship at the time the photographs were taken and, in particular, how far trimmed by the head she was as a result of the flooding of the FPT, nos. 1 and 2 cargo holds and, possibly the void space above the FPT. Reading the photographs doubtless necessitates caution, but they are helpful as being some of the least debatable evidence.
[75] Mr Colman was of the view that the white painted bulwark coaming was still above sea level when the 12:18 photograph was taken. He initially thought the black line at the top of the bulwark was visible all the way round the bow in the photograph but was puzzled by its apparent absence at the bow itself in the enhanced version. Mr Boyd analysed the crosstree and light platform shown on the gantry portal and, transposing that known height forward, calculated the bulwark was 16.4m from the base of the mast. His conclusion was that at 12:18 “water was just spilling over the extreme forepart of the fo’c’sle bulwark”. Other opinions were divided as to whether the white splash in the bow area was part of the white painted bulwark or seawater creaming over it.
[76] The Court’s view, exercising the caution counselled by the experts, is that whilst, of course, the photograph is an accurate depiction of the ship at the moment it was taken, it can be taken as a guide to the ship’s condition at around 1218 hrs. As an example, the crew’s statements were that during the passage to the anchorage Tasman Pioneer was heading into a north-west swell of about 2m, and Mr Igawa said the swell was up to 2m at 0930 hrs. Captain Kuroki said when he arrived at the Tasman Pioneer at 1835 hrs the swell was 1.5m. The consistency of those accounts suggests a similar swell at the time the photograph was taken, with the ship lolling in the swell, her responses dampened by the weight of water in her and the weight of the anchor chain. The likelihood, therefore, is that at around 1218 hrs the ship’s trim was such that the extreme forepart of the white painted fo’c’sle bulwark would have been slightly above the sea surface if calm but the sea state meant the swell probably spilled over the foremost extremity of the bulwark flare at times.
[77] Other photographs taken after 1550 hrs showed the ship’s condition worsening. It is unnecessary to annex these as they were taken by salvors and no party criticises Nippon Salvage’s actions once it was on station.
Evidence
(1) Captain Hernandez’s actions
[78] Captain Goodrick was strongly critical of Captain Hernandez’ actions He said the risks were too great in the circumstances for the master to take the route east
of Biro Shima safely. His choices, both then and afterwards, fell short of what would be reasonably expected of a prudent master and put the crew, vessel and cargo in peril. Taking the vessel east of Biro Shima saved only about 10 nm and thus only about 30-40 minutes steaming time, a distance which could be easily lost by adverse tides and currents, winds – including windage – and possible successive course alterations for safe navigation through an area of heavy traffic.
[79] In support of his view that the chosen channel was risky, Captain Goodrick said this was a night-time transit into near gale force wind in a passage with strong currents, possible tidal eddies and overfalls, the ship had a defective second radar, Biro Shima was unlit, terrain to the east may have obscured the beacons there and there was the possibility of meeting a southbound vessel using the same channel.
[80] Following the grounding, Captain Goodrick said that in addition to fully informing the coastguard and owners or managers, Captain Hernandez should have sounded the general alarm, checked all crew were accounted for and ready, if necessary, to abandon ship, reduced speed, taken precautions such as closing watertight doors, broadcast the situation to all other vessels, displayed the necessary warning lights and shapes, directed the crew to undertake and record frequent soundings and instituted and recorded a comprehensive pumping plan, prepared to anchor and taken advice from the coastguard as to the nearest sheltered anchorage with a suitable shelving bottom should beaching be required. Captain Goodrick’s view was that the coastguard would have recommended steaming for about an hour at a reduced speed some 6-9 nm north-east into Sukumo Wan and anchoring in the lee of Kuro Saki. He noted there is a marine safety station at the head of Sukumo Wan and the Japan Pilot describes the area as a safe anchorage for large vessels. Captain Goodrick’s view was that had Captain Hernandez acted as a prudent mariner, Tasman Pioneer would have been in that sheltered anchorage by around
0400 hrs with the management and insurers having been accurately informed, assessed the case and arranged for salvage by Nippon Salvage under LOF 2000. The coastguard would have been advised and would have arrived by helicopter or patrol craft with necessary preparations for crew evacuation in place. All the ship’s pumps would have been operating at full speed since shortly after the incident and the
coastguard, possibly with the assistance of Nippon Salvage, would be starting to deploy additional pumping capacity.
[81] Contact with the coastguard should have been maintained with advice of the ship’s state – that she was taking water - water levels and whether fuel oil tanks had been damaged with the attendant risk of pollution and including changes in the ship’s position and condition.
[82] Captain Goodrick was critical of Captain Hernandez for steaming some
22 nm into a near gale until anchoring some 2-2½ hours after the grounding. Captain Hernandez knew during that passage that nos. 1 and 2 holds and the FPT were taking water. Captain Goodrick said it is conventional wisdom that a cargo vessel is likely to sink if more than two large compartments are flooded, especially where, as here, they share common transverse bulkheads. Stability can be significantly affected by the “free surface” effect of water sloshing about in large spaces such as holds: “many thousands of tonnes of water and cargo sloshing about in the holds and the loadings which this put on the bulkheads must have been extreme”. Water pressure can cause a vessel to flex with seams and joints failing and pipes under pressure. Other witnesses shared those views.
[83] Captain Goodrick was particularly critical of Captain Hernandez’s delay in advising Technomar. Even if the first telex to Technomar – possibly sent at 0520 hrs
- was accurately timed, that was still 2:25 hours after the grounding. Even then, it minimized the casualty. That possibly explained why Technomar did not first contact Nippon Salvage until 0850, 5:55 hours after the incident and 3:30 hours after Technomar was possibly informed.
(2) Salvage
[84] Mr Hoskison, a salvor with over 30 years’ experience, summarised his opinion by saying he calculated Nippon Salvage could, following notification in accordance with Captain Goodrick’s views, have reached Tasman Pioneer before the foredeck was submerged. That would have made salvage and pumping much more straightforward and contained the flooding of nos.1 and 2 cargo holds to below
tween decks. Temporary repairs could then have been effected, de-watering undertaken, the level of flooding greatly reduced and consequent cargo damage either avoided in the case of on-deck cargo or greatly reduced. By not raising the alarm immediately and taking the reasonable steps expected of a prudent master, Mr Hoskison said Captain Hernandez increased the risk to crew, ship and cargo and made salvage much more difficult and expensive.
[85] Large salvors such as Nippon Salvage run a 24-hour seven day a week operation to respond to the invariably urgent instructions they receive. Mr Hoskison said that on receiving notification of a casualty, salvors seek as much information as possible to determine the extent and difficulty of the required response but the important thing is to get to the casualty and offer assistance as soon as possible.
[86] Mr Hoskison said salvors’ response depends on the information available including the equipment required. Salvors try to obtain permission to communicate directly with the vessel, though information is sometimes diverted through owners or agents. Direct communication assists salvors both to mobilise and give advice as to how the casualty should best be dealt with. Helicopter support is nowadays commonplace and can be critical, particularly where casualty and salvors are well apart. Co-operation with State authorities and coastguards is often required, though their interest is principally in possible loss of life and pollution and their assistance is mainly in ferrying personnel or making helicopters available. However, it must be observed that although the coastguard apparently had helicopters and although Nippon Salvage regarded this as a severe emergency, one of the notable features of this case is that helicopters were never employed other than, possibly, for surveillance.
[87] Mr Hoskison said that “salvors are volunteers [and] that is the very fundamental nature of salvage services”. Their remuneration comes from awards after the event, usually as a result of contractual arrangements with owners or underwriters. LOF 2000 is the most usual contract, arrived at often after negotiation and an assessment by the parties as to its appropriateness in the known circumstances. He made the point that quantum of awards is often affected by success. Factors in a salvage arbitration invariably include that the “attendance by
the salvor be voluntary”, the level of real or apprehended danger and a fund against which payment can be claimed (other factors include those in the London Salvage Convention 1989 Art 13, Reeder Brice On Maritime Law of Salvage (4th ed 2003 paras 2-116-118, pp 161-162). Brice also says (para 1-206 pp 65-66) that :
That the services to the property in peril are rendered voluntarily, that is without any pre-existing contractual or other legal duty, is an essential ingredient to a right to recover salvage. The duty referred to is a legally recognised duty towards the salved property or its owners and not a mere sense of moral obligation. (Emphasis in original).
[88] Though detailing why the requirement of voluntariness can be ambiguous in salvage law, Rose et al Kennedy & Rose: The Law of Salvage (6th ed 2002 para 515 p 243-244) say that “it was established by the Admiralty Court as a general rule that voluntariness is an essential element of salvage, and the salvors must be volunteers”. They note that The Carrie [1917] P 224, 230-232 held:
The foremost of those principles [those relating to salvage] is that the salvors must be volunteers, and a salvor is not a volunteer when he is bound by his contractual or official duty to do that which he does.
[89] Though not of direct relevance in this case given the nature of the casualty, the obligation of mariners, including salvors, to render assistance to ships and their crews after a collision and to “proceed with all speed to the assistance of persons in distress”, formerly found in the Brussels Convention 1910 Art 11 currently finds its contemporary New Zealand expression in the Maritime Transport Act 1994 ss 32 and 215 and the Sixth Schedule incorporating the International Convention on Salvage 1989, especially arts. 8 R 1 and 10, R 1.
[90] Mr Hoskison’s opinions as to the options available to Nippon Salvage concerning the Tasman Pioneer reflected those of Captain Goodrick. Had there been a Mayday call by 0330 hrs the coastguard would have responded with patrol boats and possibly helicopters. That, he pointed out, was what actually happened once the coastguard was alerted to Tasman Pioneer’s predicament at about 0715 hrs.
[91] Based on his experience and Nippon Salvage’s records, Mr Hoskison’s view was had it received full and accurate information, Nippon Salvage would have immediately mobilized Seiha Maru No.2. He said that “if Nippon Salvage had been
made aware at the outset that the vessel was sinking, I believe it would have acted as any major salvage company and mobilized immediately” and “it would not wait for communications from the owner ... or any contractual arrangements to be concluded”, those being finalized later.
[92] Seiha Maru No.2 was a large salvage tug with 13 pumps ranging from 2-6 inches and with a total capacity of 1300 tonnes per hour plus a compressed air facility. Incorporating the 1:30 hours mobilization time actually taken, had the master contacted the coastguard and Nippon Salvage no later than 0330 hrs, his view was that Seiha Maru No.2 would have been under way by 0500-0530 hrs as the salvors “would know that they had a race against time if the floodwater gained in the holds [and] they would not wait to conclude a salvage contract”.
[93] Noting that Nippon Salvage mobilized and Seiha Maru No.2 left Moji and Hayashio Maru No.2 left Imabari at 1125 and 1130 hrs respectively and arrived at the casualty at 1915 and 2120 hrs respectively, that is after steaming for 7:40 hours and 9:50 hours respectively, his calculation was that, in the early notification scenario just discussed, the tug and the ship could have rendezvoused perhaps by
1230-1300 hrs or, with Tasman Pioneer’s hypothetical anchorage being about an hour’s steaming beyond her actual anchorage, Seiha Maru No.2 could have arrived at the casualty no later than 1400-1430 hrs, well before Mr Igawa’s last photograph. He noted that two sets of 75mm gasoline pumps were installed and operating within
45 minutes of Seiha Maru No.2’s arrival and others progressively thereafter. Prompt and proper information by the master would therefore, in Mr Hoskison’s view, have resulted in Nippon Salvage being able to reach the casualty and stabilize the flooding into cargo holds nos.1 and 2 before the decks went under, thus saving all deck cargo.
[94] In cross-examination he accepted that, at whatever hour they were called, crew would take time to reach base and time would be taken in readying the tug. He also accepted that, in the circumstances of this case, it was uncertain whether Nippon Salvage may have mobilized earlier than when LOF 2000 was agreed at 1000 hrs had Nippon Salvage known of the seriousness of the casualty but he said after receiving information at about 0830 hrs of a ship down by the head in an approximate position and a call from Technomar at about 0850 hrs, there was little
sign of urgency until contact was made with the coastguard about 0930 hrs, and the seriousness of the ship’s position realised. At that point Mr Yano rang Master Landelius. He accepted the Seiha Maru No.2’s log stated “received salvage work & S/B for leaving port” at 1000 hrs, about the time LOF 2000 was agreed. Mr Hoskison nonetheless adhered to his view that had the seriousness of the situation been known earlier the tug would have mobilized earlier. Pressed to agree that Nippon Salvage’s delay in mobilizing until after LOF 2000 was agreed indicated a likelihood the same would have occurred had they been called earlier, Mr Hoskison said “It is not what a professional salvor would normally do”.
[95] He also said a salvage team could have been despatched to Saiki, one of the closest ports to the hypothetical anchoring site. The distance Moji-Saiki is about 200 km and the driving time would have been about 3:30-4:00 hrs giving a projected arrival time at about 0700 hrs, an estimate he later modified to 0800-0900 hrs.. That team could have taken with them the eight portable 75mm pumps available at Moji and associated gear. At Saiki they could have rendezvoused with a coastguard launch or helicopter to transfer perhaps six of the pumps to Tasman Pioneer giving an additional 180 tonnes per hour pumping capacity within an hour of arrival. Mr Hoskison’s view was that all those portable pumps could have been operating by
1100 hrs thus slowing the flooding rate.
[96] On arrival of the Seiha Maru No.2 at around his projected latest time of
1430 hrs, he would have expected the first pumps installed to the nos. 1 and 2 holds to have been six inch electric pumps with a capacity of about 150 tonnes per hour progressively deployed. The increase in pumping capacity over the ship’s pumps would then be 600 tonnes per hour. Nippon Salvage would then have installed their two 500 tonnes per hour Framo pumps. They are so heavy cranes are required to instal them. They needed to be inserted into holds, possibly by cutting holes in the deck. Mr Hoskison’s view was that the Framo pumps would have been operating through the night on 3 May.
[97] In parallel, Mr Hoskison said Nippon Salvage would be pressurizing such of the ballast tanks, void spaces and FPT as could be pressurized. His understanding was that it would have been possible to evacuate the water from no.2 WBT P and the
FPT thus improving the buoyancy of the bow by, according to Mr Colman’s estimate, about another 750 tonnes.
[98] Divers would have inspected the hull on 3 May or, more likely, at first light on 4 May, reporting on the actual holes. In addition, Mr Hoskison took the view Nippon Salvage would also prioritize on-deck cargo discharging above hold no.2 and the cargo above the tween decks, using the ship’s cranes and large barges, a relatively straightforward exercise once trim was restored. That would lighten the vessel forward, save the cargo and improve access to holds for further salvage. Once stability was achieved, de-watering, unloading and patching would continue together with possible beaching or towing the ship to a more sheltered anchorage or one with repair facilities.
[99] From the coastguard photographs, Mr Hoskison concluded the ship was slowly sinking whilst Mr Igawa was on station. Mr Hoskison drew particular support for his assessment of salvageability from the photographs taken at around
1530 hrs and 1550 hrs. Those showed the ship’s bow and accordingly the on-deck cargo above water a little over 12 hours after the grounding and when the master and crew had done little beyond operating the ship’s pumps. Salvors had yet to arrive. His view was that if the Seiha Maru No.2 had reached the ship about 1430 hrs the additional pumping capacity she carried would have stabilized Tasman Pioneer and prevented further sinking.
[100] Captain Landelius differed from the views of Captain Goodrick and Mr Hoskison that had notification been early and full, Tasman Pioneer would have been at a sheltered anchorage in Sukomo Wan by about 0400 with managers, insurers and SCR specialists contacted, salvage under LOF 2000 agreed, coastguards on site with portable pumps to augment the vessel’s equipment and with an environmental impact assessment having been completed. His view was that, after checking the crew’s welfare and assessing the circumstances, Tasman Pioneer should have been heading towards a safe anchorage by 0400 with the master contacting owners en route for them to report to underwriters for Club membership and cover to be confirmed, and for underwriters then to commence negotiations with
salvors on the terms of the latter’s engagement. The coastguard would, in his view, not necessarily have acted immediately on receiving advice of the casualty.
[101] If there had been early notification, Captain Landelius thought a realistic time-frame for concluding LOF 2000 would have been around 0530 hrs on 3 May, only some four and a half hours earlier than LOF 2000 was actually agreed.
[102] Captain Landelius also disagreed with Mr Hoskison’s view that Nippon Salvage would have mobilised immediately it received news of the casualty though he accepted that, immediately on receiving the coastguard information as to the casualty and that its tugs and pumping capacity might be required, it may have mobilized and left port, leaving Moji base to agree LOF 2000 while it was en route to the casualty.
[103] Captain Landelius noted the Seiha Maru No.2 left Moji at 1125 hrs,
1:25hours after LOF 2000 was agreed and, though steaming at full speed, did not arrive at the casualty until 1915 hrs, 9:15 hours after LOF 2000 was agreed. Therefore, even accepting Mr Hoskison’s mobilisation estimate – something he suggested was unrealistic with the number of men required at that time of the morning on a national holiday – and with LOF 2000 agreed at 0530 hrs, the earliest Seiha Maru No.2 would have reached Tasman Pioneer in Sukomo Wan would have been no earlier than 1515-1545 hrs. That must be contrasted, Captain Landelius suggested, with the Arita Maru’s report that at 1450 hrs seawater was “cutting the middle way of no.2 cargo hold”. Captain Landelius was similarly sceptical of Mr Hoskison’s estimate that a salvage team despatched by road could have arrived at Saiki with eight portable 75mm pumps by 0700 hrs. Mr Hoskison’s estimate rested on LOF 2000 being agreed earlier than Master Landelius thought realistic, and paid insufficient account to the 1:50 hours or more required for the mobile salvage team to mobilise and leave Moji on the day.
(3) Naval architects
[104] The expert naval architects, using such information as they could from sources including photographs, crew and salvors’ statements and the vessel’s
General Arrangement, T & S, bell and sounding books, each computer-modelled the casualty, especially the rate of flooding and the rate at which Tasman Pioneer was sinking, though each used different programs. There was a reasonable measure of broad agreement between them on such things as data sources, methodology and the like, but they differed on detail, particularly rates of flooding and immersion.
[105] Their evidence is difficult to review because of the wealth of detail: the first draft of this judgment included a 20-page summary. However, with no disrespect intended to them and conscious that summarizing experts’ views risks omitting detail regarded by the witnesses as important, the Court proposes to include reference only to some of their conclusions rather than their methods of calculation, partly because of the area of general agreement, partly because they both agree some of the data input such as interpretation of the photographs or salvors’ comments was impressionistic, partly so as not to overburden a lengthy judgment, but mostly because, as Mr Boyd put it:
The input data and the contemporaneous evidence I don’t think are reliable enough to use a model in these circumstances where you have so many different ... input variables. You have coefficient discharge, area, inside head, outside head, and cargo permeability and then on the contemporaneous evidence you have [in?]accurate draft and freeboard where read off photographs, crew soundings etc, and none of the information in those ... categories in my opinion is reliable enough to give an accurate picture.
or, when asked if there was enough data to model, accurately, the time at which the fo’c’sle deck was likely to have become awash, he said he did not “consider there was sufficient input data for the models to provide accurate and reliable results”.
[106] There is weight in Mr Boyd’s views. However accurate the programs and however expert the interpretation of their results, the models can only yield results as precise as the input data. And here, necessarily, the input data was partial and imprecise. The otherwise seeming accuracy of some of the results could therefore, if taken too literally, be misleading.
[107] That can be demonstrated by recounting Mr Colman’s summary:
... It is my opinion, that had the master anchored the vessel in sheltered water as soon as possible after the grounding and applied the vessel’s pumps
effectively to the flooding in holds 1 and 2, then the flooding into these holds would not have reached past the tween decks until well after 1200 hours on
3 May 2001, giving Nippon Salvage the opportunity to apply sufficient
pumping capacity to prevent flooding above this level ever occurring.
...
In my view the void should not have flooded. The design of the vessel is such that this void is enclosed in steel plate with no access except probably a manhole secured by a bolted plate. There should be no openings which could leak. There will have been pipe work through the void. If these pipes were in the same condition as the pipes in hold number 3, then corrosion of these pipes may have caused flooding in the void space. The chain locker is also flooded, probably through openings in the bosun’s store or possibly down from the open tops from the focsle.
...
In my view, flooding of the void space is implicated in the rate at which the bow of the vessel went under. If the void had remained watertight, then the bow would have remained above the water level for longer. Looking at the draughts at 0950 the water level was too low at that stage for the void and bosun’s stores to flood. As the vessel sank further in it appears that these spaces have flooded slowly at later stages. These are both large spaces and maintaining their integrity would have provided buoyancy well forward in a favourable position for delaying the immersion of the bow. Based on my modelling of the flooding into the holds I have calculated that the vessel’s decks would have remained above the waterline until at least 1715 had the void space remained dry. By then Nippon Salvage would have arrived.
...
I know that there are air pipes from the fore peak tank to the deck head. These pass through the void space. The water level in the fore peak tank air pipes remained at sea level as the bow continued to lower, so water would have been forced up through the pipes. If they were corroded or had holes in them, then this would have been a source of leakage into the void space. I cannot think of any other source of water. I would have to assume therefore, that the pipes were corroded near the deck head which is the usual location for such corrosion. ...
From this, it is reasonable to assume that the void started to flood as the water level rose up to the top of the air pipes at around 1015 according to my reconstruction, before the state of the ship shown in the coastguard photograph at 1218. The top of the void space is below the level of the water in that photograph and if the pipes were corroded then I would assume water would be flooding into the void at that stage. Shortly after the photograph was taken at 1218 I would expect that the bosun’s store would start to flood. With the void space and bosun’s store flooded the vessel had no watertight compartments in the focsle. ... Keeping the void dry would have bought more time so that when salvors came alongside, the focsle may not have been under water.
[108] By contrast, Mr Boyd summarized his views in the following way:
I disagree with the main conclusions of Mr Colman, and believe that the grounding and subsequent floodwater ingress to the vessel was such that the forward deck cargo would have been wetted by seawater whether the master had notified owners of the grounding and called for assistance earlier, or not.
Mr Colman has formed the view that the forward void space must have filled with water when it should not, and that consequently he considers the vessel was “unseaworthy”.
I disagree with Mr Colman that it was inevitable that this void space filled with water when it should not. It is clear that the space ultimately filled with water, although I believe this most likely occurred once the respective focsle deck openings were submerged.
views he supported in the following passages:
1218 hrs Condition
Mr Colman states ... the vessel was not in equilibrium at 1218 hrs but was continuing to flood and I would agree since progressive flooding is known to have continued thereafter. Mr Colman considers it to be remarkable how the
1218 hrs photograph shows less immersion and forward trim than later on but I do not consider this a reliable gauge. Any inaccuracies in photographs
aside, this is possible for a number of reasons but obviously all to do with which compartments were flooded and how quickly. As mentioned earlier,
the hold ingress was likely faster initially based on a true starting position at
0315 hrs (i.e. without WBT Nos. 3S or 4S) at relatively early stages, but this would slow down with decreasing amount of head differential and increased
demand for air exhausting. Conversely, the latter ingress rates could be expected to increase as a result of higher permeability values of the upper
hold spaces and hatchways and also as a result of containers becoming filled.
...
1500 hrs Condition
Mr Colman states the focsle deck would become immersed ... which I
would agree with, although:
(a) Mr Colman does not give the earliest time at which the focsle deck became immersed;
(b) The salvage master (statement, pp5) reports that at 1450 hrs the seawater level “was cutting mid part of no.2 cargo hold”, meaning the focsle deck would indeed have been immersed, and time would have passed since then to enable both hatch no.1 and the forward hatch of hatch no.2 to become immersed;
(c) While there is evidence as to the attitude of the vessel in the water, this does not directly explain precisely what internal weight distribution/flooding was occurring that these stages. This must be considered using valid assumptions.
...
... On Mr Colman’s calculations:
1500 hrs scenario – the vessel had a mean draught (10.18m) and forward trim (10.31m) giving a forward draught of 15.33m meaning the focsle and main deck remained above sea level. However, the deck edge at Fr 174 was only 0.73m above sea level, and if allowance is made for the 1-1.2m wave height and also any vessel motion, then this could be immersed periodically by about 1.5m which would hamper any operations on deck;
1700 hrs scenario – the forward draught of 16.33m means the focsle deck is not yet awash according to the static waterline, although by now the deck edge is submerged at Fr 175 (just under) and the bosun’s store hatch and hawse pipes only have a freeboard of about
1m. Again, if allowing for any sea the focsle and main deck would be awash.
The above results are based on Mr Colman’s ingress amounts and are optimistic according to evidence such as the 1218 hrs photograph (bow stem at sea level) and 1450 hrs evidence (sea level cutting mid length of hatch no.2). My calculations show that, using alternative flooding amounts based on reasonable factors already discussed, the observations at 1218 hrs and
1450 hrs are possible with the void space remaining sound, but later being flooded from down-flooding as already mentioned.
[109] Mr Boyd also disagreed with Mr Colman’s hypothesis that the void space flooded through corrosion holes in an air pipe through the space by saying:
... Flow rate calculations have been carried out for this air pipe, typically
100-125mm diam4eter, and my results show that this is inadequate to flood this space in the manner postulated.
... Mr Colman calculates .. that some 320mt seawater would flood into this space in two hours (160mt/hr) but I calculate that for this to occur though an air pipe, the hole would have to be damaged with a disproportionately large hole, i.e. exceeding the diameter, or for the pipe to be completely severed by a substantial amount separating the lengths. Both scenarios are unlikely for a supported pipe in a dry space where pipe-work is free from accidental damage and any associated corrosion effects. ...
The manhole to which he refers ... is denoted as square hatchway positioned on the starboard side at Fr. 210-211 (see GA plan). The means of access from the bosun’s store to the void space below would likely be via a
‘weathertight’ folding steel hatch ... normally closed by dogs as required by the International Loadline Convention, 1966 (ILLC66) requirements – i.e. a
closing appliance for an opening leading to an enclosed space below the
freeboard deck but which closing appliance is housed within an enclosed
‘weathertight’ space needs only to be weathertight, at most. Conversely, directly below this in line with the same ladder, the access from the void space to the fore peak tank underneath ... would be a bolted manhole cover capable of withstanding a permanent head up to main deck level upon filling the FP tank. I therefore disagree the bosun’s store could not flood from above since a ‘weathertight’ closing appliance may withstand a head of, say,
2.5m but only for periodical immersion and ingress will occur even when closed if submerged for more than temporary immersion., If the manhole was not tightened, for reasons such as regular access, then this would allow flooding via the bosun’s store.
...
The overall effect of flooding the void space in the context of the holds and other forward spaces is less than the effect of varying the hold permeability values which is likely, let alone any tolerances on permeability. I have investigated a series of increased/reduced permeability values for hold no.2/hold no.1 respectively, flooded to equilibrium level in each case, and my results show two important features:
(a) the focsle is submerged in every case; and
(b) the effect of altering hold permeability is about the same or more onerous than flooding the void space.
[110] By way of elaboration, Mr Colman computed the rate of flooding stemming from the grounding. The program calculated the flooding rate at 15 minute stages from 0315 hrs with the damaged ballast tanks fully flooded and nos. 3 and
4 WBT(S) tanks ballasted. Each recalculation included the new relative levels of the sea, flood water, new drafts, trim and heel and with probable pumping efforts also factored in. His analysis of the crew statements suggested co-ordination of pumping was poor and the pumping of little effect so he assumed, for reconstructive purposes, that no reduction of seawater volumes in the hold was achieved and that any pumping which took place during the passage to the anchorage was ineffective. Mr Boyd tended to agree that the crew’s pumping should be largely disregarded for modelling purposes.
[111] Because Mr Colman was unaware of the size of the holes either in the outer holds or the bilge wells, he inputted the computer with the reported drafts to compute possible hole sizes and calculated the rate of water entering the ship’s compartments through the holes. That was dependent on pressure at the hole entrances, that being determined by the head, the difference between the level of sea water outside and the level of water inside the hull. The FPT, no.1 DBWBT and no.2 DBJ tank (P) were open to the sea with access to the holes in the bilge wells.
[112] From the dry dock photographs, evidence of hull damage to the DBT and
FBT and his computer calculations, Mr Colman’s view was that the ship would have
been taking water through the external holes at as much as 15 tonnes per second or
60,000 tonnes per hour, well outstripping any pumping capacity.
[113] However, water ingress to the nos. 1 and 2 holds was through the damaged bilge wells. They were at the top of the DBTs so they had to flood before water entered the holds. That took 20-30 minutes at most. The computer calculation implied openings of about 112mm2 and 145mm2 into holds 1 and 2 respectively through the bilge wells and Mr Colman’s model suggested that about 500 tonnes of water per hour entered each of the two holds through the damaged bilge wells. That ingress would gain on the ship’s pumps but the flooding rate would slow to about
300 tonnes per hour once the level of water in the holds approximated the outside sea level, thus leaving the ship sinking, but more slowly.
[114] In cross-examination he accepted nobody knew the size of the holes into the bilge wells and accepted the water volume entering the holds was determined by the size, shape and profile of the holes itself, plus water pressure. With his assumed hole sizes calculated from the required flow rate which in turn was calculated from the condition the vessel was known to be in, that is to say, the observed drafts at 0952 and 1050 hrs, the soundings from the soundings book and the 1218 hrs photograph, he worked back from the known data to calculate the flow rate required to reach the condition at that time and calculate from the size of the opening the required flow rate: “The size of the opening is not part of the input” because it depends on a normal discharge coefficient of .6 with the flow rate determined by head not by size of opening.
[115] He accepted his initial reconstruction was based on the drafts at 0950 and
1052 hrs and the 1218 hrs photograph and, though they did not match the observed drafts or the photograph, they were not in his opinion too far away. He thought the
1218 hrs photograph very useful and interpreted it as showing the whole of the white painted bulwark above sea level. If the bow was under water in that photograph the model would not have explained the condition. He was firm in his view that the bosun’s store and void space would not have been downflooding by 1218 hrs because of the high sills, and the need for a significant head of water applied to the
openings so the bow would have needed to be several metres further immersed for downflooding in the bosun’s store and void space to be occurring at 1218 hrs.
[116] Mr Boyd’s model concurred with Mr Colman’s estimates of the rate of ingress from evidence of drafts at various stages but although the models agreed when using the same amount of floodwater, Mr Boyd thought Mr Colman’s input data was not necessarily accurate because of different assumptions including permeability, coefficient of discharge, differential heads, unclear photographic substantiation and what Mr Boyd regarded as an erroneous start point, 0315 hrs for crew pumping. He also suggested Mr Colman had omitted other useful sources of the reported floating attitude including the salvage master’s 1450 hrs statement.
[117] Mr Boyd thought the size of the holes made a significant difference. He made the point that each bilge well was two frame spaces in extent, that is approximately 1.4m long, 600-700mm wide and 800mm deep in the no.1 hold and
1.9m deep in no.2.
[118] The master steaming for about an hour at 15 knots increased the rate of flooding by forcing water into the vessel and negated the pumping effort particularly when the crew statements suggest that only one pump was intermittently used. Mr Colman’s model said the “master’s actions caused much more rapid flooding of the cargo holds and increased the danger of sinking or capsizing, significantly increasing the danger to crew and cargo” and missing the opportunity to save that cargo. The master’s actions after grounding including the delay in calling for help caused delays in responses from the coastguard and Nippon Salvage and “as a direct result the vessel’s decks were submerged back to the hatch of hold no.3” and “this significantly increased the damage to the cargo and the degree of difficulty faced by Nippon Salvage”. Mr Boyd largely agreed.
[119] Mr Colman modelled the effect of earlier deployment of Nippon Salvage’s portable pumps through coastguard assistance. He assumed that by 1100 hrs six
30 tonne per hour pumps would begin operation. On his model, by that time the ship’s pumping capacity was exceeded by 100 and 200 tonnes per hour in holds nos.
1 and 2 respectively so the addition at 1100 hrs of an extra 180 tonnes per hour
capacity would still have left a deficit of 120 tonnes per hour. That reduced the rate of sinking and gained a number of extra hours for salvors to deploy large pumps.
[120] On that model, the addition of portable pumping capacity would have enabled Nippon Salvage to reach the vessel with its tugs and barges before the tween decks in holds 1 and 2 were flooded and once Seiha Maru No.2’s 1300 tonnes per hour capacity was deployed between 1430 hrs and 1630 hrs the pumps would gain on the flooding, particularly when Hayashio Maru No.2’s six pumps totalling 500 tonnes capacity were available.
[121] Then, once the Framo pumps were installed, the water in the hold spaces could have been pumped to a low level maintainable until beaching or temporary repair.
[122] Mr Colman said damage to the plaintiffs’ cargo did not become inevitable until some time overnight 3-4 May.
[123] In response to the salvor’s report that at 1450 hrs the ship was heavily down by the head such that sea water was “cutting the mid part of the no.2 cargo hold”, Mr Colman said his model had that happening “less than an hour later”. At 1218 hrs the water level was nowhere near the hatch covers, nor was it at 1530 hrs. The salvor’s comment at 1450 hrs was at main deck level, not the hatch covers which were another metre or more up with those on the fo’c’sle deck even higher.
[124] Mr Colman’s view was that the water cutting the no.2 cargo hold comment at
1450 hrs and the reference to the bow deck being awash at 1530 hrs, would not mean waves were breaking over the bow by the latter time if the earlier drafts were correct. Even taken in conjunction with the 1218 photograph, it made only a slight difference. Mr Colman concluded:
If the correct operations had been carried out, as I think we showed in our latest reconstruction, the deck could have been well above water at 8 o’clock the next morning.
[125] Both naval architects were dubious about the accuracy of the soundings book. Mr Colman said the sounding entries would better correlate with the observed drafts
and trims if they had been taken about three hours later than the times at which they were listed. He made the point that, according to the soundings book entries, the soundings were always taken at exactly the same time every day so they may have been taken later but entered as at the usual time. Conversely, Mr Boyd said if the entries were correct, flooding was much faster than the model.
Submissions
(1) Plaintiffs
[126] All counsel were agreed that a central issue in this case is the correct construction of Art. 4, R 2(a) of the Hague-Visby Rules, earlier cited.
[127] The plaintiffs claim the exemption in Art. 4, R 2(a) is inapplicable if damage to on-deck cargo is caused when the master, after a casualty, engages in conduct intended to conceal the time, place and circumstances. The plaintiffs say that in that situation, the actions of the master are not bona fide actions in the navigation or management of the ship, such is required and the exemption does not apply.
[128] Here, the plaintiffs contend that the master’s wilful conduct following the grounding of the Tasman Pioneer was not in good faith and was so contrary to proper seafaring practice as not to be recognisable as amounting to navigation or management of the ship.
[129] The plaintiffs also assert that Tasman Orient has the onus of proof of its entitlement to the exemption.
[130] By contrast, Tasman Pioneer said that if cargo damage arises as a result of want of care of the vessel, as long as the carrier has exercised due diligence in providing a seaworthy ship and properly manning her, the carrier is not vicariously liable for its servants or agents and is not liable to cargo interests under Art. 4 nor is it vicariously liable for the master’s intentionally reckless conduct.
[131] Mr Rzepecky’s submissions were to the effect that had the master advised the coastguard almost immediately after the grounding, say by 0330 hrs, that holds 1 and
2 were flooding and the ship’s pumps were not coping, the coastguard would have mobilised patrol boats, Nippon Salvage would have mobilised and the Seiha Maru No.2 would have left Moji by about 0500 hrs and arrived at Tasman Pioneer in Sukumo Wan at about 1400 hrs, two portable pumps would have been installed and operating by 1615 hrs with larger pumps deployed and operating by 1930 hrs. The
600 tonnes per hour of extra pumping capacity would have gained on the flooding, he submitted, noting that Mr Coleman calculated that at that stage, half that capacity would have been sufficient to stabilise the vessel. Tasman Pioneer’s decks – and more importantly, its on-deck cargo – were still above water at 1330 hours. That would have given Nippon Salvage 2½ hours to mobilise sufficient of its pumping capacity to stabilise the vessel. Once the vessel’s decks went under, as Mr Hoskison said, the salvage situation changed dramatically given the deck apertures permitted flooding and the hatch covers were only weathertight.
[132] With Mr Gray, Mr Rzepecky submitted the Hague Rules were the culmination of lengthy negotiation designed to balance the competing interests of shippers and owners at an international convention convened following efforts by owners over previous decades to avoid contractual responsibility to the point where legislatures around the world felt it necessary to intervene. The approach to the interpretation of the Hague and Hague-Visby rules is as set out by Gaudron Gummow and Hayne JJ in Great China Metal Industries Co Ltd v Malaysian Shipping Company (the “Bunga Seroja”) (1998) [1998] HCA 65; 196 CLR 161, 168. The same approach to the interpretation of international treaties applies in New Zealand (Sellers v Maritime Safety Inspector [1999] 2 NZLR 44, 57-58).
[133] Mr Rzepecky made the point that Art 3 imposes strict liabilities on carriers for cargo and contains a non-delegable obligation on carriers to exercise due diligence at the commencement of any voyage to ensure the ship is seaworthy and properly manned, breach of which precludes the shippers’ reliance on the exemptions in Art. 4. The Court’s approach has been to construe exemptions strictly
(Cooke et al, Voyage Charters (3rd ed, 2007, para 85.58, p 1020).
[134] Both counsel conceded their researches had been unable to locate a case closely comparable on its facts with the present. Most authorities on Art. 4 R 2(a)
are fact-specific. As an example, after reviewing a number of authorities, Boyd et al, Scrutton on Charterparties and Bills of Lading (20th ed, 1996, p 243-244) held that the words “management” and “navigation” mean:
If the cause of the damage is solely or even primarily a neglect to take reasonable care of the cargo, the ship is liable. But if the cause of the damage is a neglect to take reasonable care of the ship or some part of the ship, as distinct from the cargo, the ship is released from liability. If, however, the negligence is not negligence towards the ship but only a negligent failure to use the apparatus of the ship for the protection of the cargo the ship is not so relieved.
and in Tetley (Marine Cargo Claims, 3rd ed, p 397-398) the learned author says “error in the navigation or the management of the ship is a concept which perhaps provides difficult problems of interpretation”, and goes on to say:
The problem is to distinguish fault in relation to the ship for which the carrier may exculpate himself and fault in respect of care of the cargo for which the carrier is responsible under art. 3(2). One can be called “ship navigation or management fault” and the other “cargo care fault”. The French terminology is useful: “faute nautique” (nautical fault) for error in the navigation and management of the ship and “faute commerciale” (commercial fault) for error in the care of the cargo.
II. Definitions
1) Error in Navigation or Management
An error in the navigation of the ship or in its management is an error primarily affecting the ship. Error in the navigation and management of the ship might be defined as an erroneous act or omission, the original purpose of which was primarily directed towards the ship, her safety and well-being and towards the common venture generally.
...
2) Error in Care of Cargo
To be contrasted with an error in the navigation or management of the ship is an erroneous act primarily directed towards the care of the cargo. ...
3) Error in Respect to the Ship and the Cargo
If both ship and cargo have been affected by the same error then the carrier is usually exculpated, because the whole venture is implicated, but each case must be decided on its own facts. ...
and the matter is pithily described in Richardson: The Hague and Hague-Visby Rules
(4th ed 1998 p 33) in the following terms :
Act, neglect or default in the care of the cargo dos not come within this exclusion. This means that the error has to be one primarily affecting the ship. A simple definition might be that it is an erroneous act or omission, the original purpose of which was primarily directed towards the ship, her safety and well being and towards the venture generally (i.e. both ship and cargo).
...
There are many grey areas where it is unclear whether an error or omission is in relation to something directed towards the ship, her safety and well being and towards the venture generally, or in relation to care of the cargo (i.e. a breach of Article II(I, Rule 2). If both ship and cargo are affected by the same error, the carrier can usually avoid responsibility, as the whole venture is involved, but each case will be decided on the individual facts of the case. Where two errors occur, one being management of ship and the other care of cargo, the carrier must distinguish between the damage caused by each or be responsible for it all.
[135] All texts describe as the leading opinion the dissenting judgment of Greer LJ (upheld in the House of Lords) in Gosse Millard 7 v Canadian Government Merchant Marine Ltd [1928] 1 KB 717, 743-4:
I think it is incumbent on the Court not to attribute to Art. IV., r. 2(a), a meaning that will largely nullify the effect of Art. III., r. 2, unless they are compelled to do so by clear words. The words “act, neglect or default in the management or navigation of the ship,” if they are interpreted in their widest sense, would cover any act done on board the ship which relates to the care of the cargo, and in practice such an interpretation, if it did not completely nullify the provisions of Art. III., r. 2, would certainly take the heart out of those provisions, and in practice reduce to very small dimensions the obligation to “carefully handle, carry, keep, and care for the cargo,” which is imposed on shipowners by the last mentioned Rule. In my judgment, a reasonable construction of the Rules requires that a narrower interpretation should be put on the excepting provisions of Art. IV., r. 2(a). If the use of any part of the ship’s appliances that is negligent only because it is likely to cause damage to the cargo is within the protection of Art. IV., r. 2(a), there is hardly anything that can happen to the cargo through the negligence of the owner’s servants that the owner would not in actual practice be released from. To hold that this is the effect of Art. IV., r. 2(a), would reduce the primary obligation to “carefully carry and care for the cargo during the voyage” to a negligible quantity. In my judgment, the reasonable interpretation to put on the Articles is that there is a paramount duty imposed to safely carry and take care of the cargo, and that the performance of this duty is only excused if the damage to the cargo is the indirect result of any act, or neglect, which can be described as either (1.) negligence in caring for the safety of the ship; (2.) failure to take care to prevent damage to the ship, or some part of the ship; or (3.) failure in the management of some operation connected with the movement or stability of the ship, or otherwise for ship’s purposes. It is worth while noting that Art. IV., r. 2(a), is not
7 “Millerd” in (1928) 32 Lloyds Rep 91.
directed to acts, neglects or defaults in the course of management of the ship, but acts, neglects or defaults in the management of the ship.
[136] And then, after reviewing a number of authorities, the Judge held (at 749):
If the cause of the damage is solely, or even primarily, a neglect to take reasonable care of the cargo, the ship is liable, but if the cause of the damage is a neglect to take reasonable care of the ship, or some part of it, as distinct from the cargo, the ship is relieved from liability; but if the negligence is not negligence towards the ship, but only negligent failure to use the apparatus of the ship for the protection of the cargo, the ship is not so relieved.
[137] Mr Rzepecky also placed reliance on the judgment of the Cour d’Appel de Rouen (1970 Jurisprudence Française 667) in ‘Lucille Bloomfield’ and ‘Ronda’, where, following a collision between the ships, the Ronda was holed but made port and was lashed to a quay. Two tugs, one equipped with powerful pumps, were available. The captain, however, solely trying to avoid salvage costs, delayed for some hours in calling for assistance. As a result the Ronda grounded, broke the lashings, capsized, and the cargo was lost. The Court held (p 12 of the translation) that the captain “had in this way committed serious negligent acts, which could be described not as nautical faults but commercial faults, and moreover his only worry was to avoid salvage costs”. The carrier was held liable to cargo.
[138] As Mr Rzepecky observed, the obligations of masters have been defined on a number of occasions. He particularly relied on The Star of Hope v Annan (1870) 76
US 638, 646), where the master in an emergency sold much of the cargo to defray expenses and the US Supreme Court held:
Owners of vessels are under obligation to employ masters of reasonable skill and judgment in the performance of their duties, but they do not contract that they shall possess such qualities in an extraordinary degree, nor that they shall do in any given emergency what, after the event, others may think would have been best. From the necessity of the case, the law imposes upon the master the duty, and clothes him with the power, to judge and determine at the time, whether the circumstances of danger in such a case are or are not so great and pressing as to render a sacrifice of a portion of the associated interests indispensable for the common safety of the remainder. Standing upon the deck of the vessel, with a full knowledge of her strength and condition, and of the state of the elements which threaten a common destruction, he can best decide in the emergency what the necessities of the moment require to safe the lives of those on board, and the property intrusted to his care, and if he is a competent master, if an emergency actually existed calling for a decision whether such sacrifice was required, and if he appears to have arrived at his conclusion with due deliberation, by a fair exercise of
his own skill and judgment with no unreasonable timidity, and with an honest intent to do his duty, it must be presumed, in the absence of proof to the contrary, that his decision was wisely and properly made.
[139] Mr Rzepecky also relied on a number of other judicial descriptions as to when the exemption applied for masters’ actions. They included that the master is “not responsible ... for mere error of judgment ... it must be almost wilfully” (The Carlisle [1906] P 301, 309); that the master has a “special duty to take all reasonable steps consistent with safety to his ship and her crew to avoid or minimise
the chance of harm to others (Boudoin v J Ray McDermott & Co 281 F 2nd 81, 85
(1960)); “a master is empowered to exercise his good faith judgment until he is relieved of his command, especially where the safety of his crew, vessel, and cargo are concerned” (Westinghouse Electric Corporation v M/V “Leslie Lykes” 734 F 2nd
199, 215, para [12], (1984) citing United Geophysical Co. v Vela 231 F 2nd 816, 819,
(1956) with Westinghouse being followed in Hale Container Line Inc v Houston Sea
Packing Co. Inc 137 F 3rd 1455, 1469, paras [17], [18] (1998)).
[140] Mr Rzepecky submitted Courts have adopted similar interpretations in voyage deviation cases such as Phelps, James & Co. v Hill [1891] 1 QB 605, 611, where Lindley LJ held:
... if a master of competence, skill, and knowledge, and acting bona fide in the interests of all concerned, has chosen one port in preference to another, then although the Court or a jury may and ought to take a different view if they come to the conclusion that he ought to have acted differently, they ought not to come to such a conclusion on light grounds. In a nicely balanced case they are fully justified in attaching considerable weight to the master’s judgment ...
(See also Danae Shipping Corporation v TPAO & Guven Turkish Insurance Co. Ltd
(the “Daffodil B”) [1983] 1 Lloyds Rep 499, 502.)
[141] Those authorities, Mr Rzepecky submitted, required masters to act bona fide to entitle a shipper to the exemption in Art. 4 R 2(a). That requires consideration of the decisions of the Court of Appeal and the House of Lords in Whistler International Ltd v Kawasaki Kisen Kaisha Ltd (The “Hill Harmony”) [1999]
2 Lloyds Rep 209 (CA) and [2001] 1 Lloyds Rep 147 (HL), and since those
decisions were placed by both counsel at the core of their submissions, it is necessary to consider them in some detail.
[142] The Hill Harmony was time chartered by owners to Whistler, sub-time chartered to Kawasaki, and sub-sub-time chartered to Tokai Shipping for trans- Pacific voyages on an amended NYPE form which required the captain to “prosecute his voyage with the utmost despatch”, but with “errors of navigation ... excepted”, and “in the event of loss of time ... caused by ... refusal of the master ... to perform the duties ... the hire shall be suspended”. The charter party incorporated the Hague-Visby Rules, including R 4 which deems “any reasonable deviation” not to be a breach of the contract of carriage and exonerates carriers from resulting loss. On one voyage west on the northerly great circle trans-Pacific route, the vessel suffered serious heavy weather damage. For a later voyage, on voyage planners’ advice, the charterers ordered the master again to take the shorter northern great circle route but the master insisted on taking the more southerly rhumb line route. That took more time and consumed more bunkers, as a result of which Kawasaki and Tokai deducted hire and claimed the extra bunker costs. A majority of the arbitrators held Kawasaki gave the master routine instructions which the master was bound to follow unless he could justify refusing. His experience on the great circle route led him to decide not to risk repeating that experience but he was not justified in that stance.
[143] On appeal from the arbitrators, the High Court held orders to proceed to particular ports were orders as to employment which the master would be bound to follow subject to his overriding responsibility for the safety of the ship, but an order as to how to proceed from the ship’s location to a particular port was an order not as to employment but as to navigation, and the decision whether to proceed across the Pacific by taking the great circle or the rhumb line route was a decision in the vessel’s navigation not her employment. The master’s decision to adopt the more southerly route was for the safety of the ship. Voyage planning was part of the navigation of a ship and the arbitrators were wrong to find otherwise. Any failure to prosecute the voyage with the utmost despatch was also an act, neglect, or default of the master in navigation. The owners were entitled to rely on Art. 4 R 2(a) as to the appropriate choice of route, choice of speed, and the master’s decision how to prosecute the voyage with the utmost despatch.
[144] The charterers appealed the question whether the disponent owners, Whistler, were liable for breach of the time charter for loss or damage caused by the master refusing to comply with the charterer’s route instruction.
[145] The charterer’s appeal was dismissed by the Court of Appeal. It held (at
214):
In my judgment an order as to where the vessel was to go, as for example to port A or B to load or discharge, or to port A or port B via port C to bunker, would be an order as to employment which the master would be bound to follow, subject, of course, (as all parties agreed) to his overriding responsibility for the safety of the ship. An order as to how to get from where the ship was to port A, B or C would not, however, be an order as to employment but an order as to navigation. ... There can I think be no real doubt that a decision by a master as to which channel to take, what course to set, or which side of an island or light vessel to go, would be a decision as to navigation and not as to employment. The same must be true of an order or direction to the master in any of those respects.
[146] After observing (at 217) that the “problem arising in this case is easy to pose but by no means easy to resolve” the Court of Appeal noted that the matter had not been argued before the arbitrators on the “employment” versus “navigation” point. The Court then held (at 218):
... neither obligation [under the charterparty and the charterer’s orders] displaced the right and responsibility of the master in matters of navigation and, in particular, to decide upon the course or courses to be followed when prosecuting the voyage as properly defined, having regard to weather conditions and other hazards of navigation. In that respect he had a duty to reach a bona fide decision based upon his own judgment and experience. As to the question of the reasonableness of that decision, if the master was negligent or unreasonable in his judgment, then the liability of the owners for such negligence depended upon the scope of any relevant exemption clause in that respect, and in particular in this case art. IV, r. 2a.
[147] The Court then relied on Larrinaga Steamship Co. Ltd v The Crown (The
“Ramon de Larrinaga”) (1944) 78 Lloyds Rep 167 at 176 per Lord Porter:
... an order to sail from port A to port B is in common parlance an order as to employment, but an order that a ship shall sail at a particular time is not an order as to employment because its object is not to direct how the ship shall be employed but how she shall act in the course of that employment... The
... instruction to sail ... leaves it to the discretion of the master who is responsible for the safety of his ship to choose the time and opportunity for
starting on his voyage.
[148] The Judge then held (at 220) that it was a matter of mixed law and fact as to whether the charterer’s orders for the vessel to proceed to a particular port by a designated route was a matter of employment or of navigation to be decided in the circumstances of the case, one facet of which was the inclusion of the Art. 4 R 2(a) exemption in the charterparty. The difference was “between an order to proceed via a generally recognised sea route to a particular place or position for a particular purpose and an instruction prescribing the specific course by which to reach that place of position” (ibid). With particular relevance to this case, the judgment proceeded (at 221) that:
If ... the master took the decision to set and follow the course which he did on the grounds that he would thereby avoid the danger of bad weather and possible damage to the ship as a result, that was indeed as the Judge stated
... a decision taken (and there is no suggestion that it was not bona fide taken) for the safety of the vessel and, as such, was a decision as to
navigation. Further, and in any event, the importation of the exemption afforded by art. IV, r.2(a) ... confirms that the exemption of the owners from
liability for acts done or decisions made by the master in respect of navigation matters should not depend on questions of reasonableness.
[149] The Judge then held the decision of the master was a decision on:
... navigation because it was a decision upon what course or combination of courses to follow in prosecuting the overall voyage and because the reason of the decision, made bona fide, was the master’s concern for the safety of the vessel.
[150] The Judge then turned to Art. 4 R 2(a) and held the first instance challenge was (ibid) “right in construing the term ‘navigation’ ... as extending to a decision taken, in the course of voyage planning, to steer a particular course or courses having regard to the weather to be anticipated”.
[151] The House of Lords reversed the Court of Appeal. Lord Bingham completed his judgment by holding (at 153):
The responsibility for making good so far as practicable, whatever course is chosen of course remains with the master and crew, as does that for navigating the vessel safely into and out of port, and responding to maritime problems encountered in the open sea. But subject to safety considerations and the specific terms of the charter, the charterers may not only order a vessel to sail from A to B but may also direct the route to be followed between the two.
[152] Lord Hobhouse took the same view. On the point under consideration, he held that (at 159-160):
The meaning of any language is affected by its context. This is true of the words “employment” in a time charter and of the exception for negligence in the “navigation” of the ship in a charter-party or contract of carriage. They reflect different aspects of the operation of the vessel. “Employment” embraces the economic aspect – the exploitation of the earning potential of the vessel. “Navigation” embraces matters of seamanship. ... What is clear is that to use the word “navigation” in this context as if it includes everything which involves the vessel proceeding through the water is both mistaken and unhelpful. ... where seamanship is in question, choices as to the speed or steering of the vessel are matters of navigation, as will be the exercise of laying off a course on a chart. But it is erroneous to reason ... that all questions of what route to follow are questions of navigation.
The master remains responsible for the safety of the vessel, her crew and cargo. If an order is given compliance with which exposes the vessel to a risk which the owners have not agreed to bear, the master is entitled to refuse to obey it: indeed, as the safe port cases show, in extreme situations the master is under an obligation not to obey the order. ...
In the present case, the exception did not provide a defence. First, the breach of contract was the breach of both aspects of the owners’ obligations under cl. 8 of the time charter – to prosecute the voyage with the utmost despatch and to comply with the orders and directions of the charterers as regards the employment of the vessel. ... Secondly, any error which the master made in this connection was not an error in the navigation or management of the vessel; it did not concern any matter of seamanship. Thirdly, the owners failed to discharge the burden of proof which lay upon them to bring themselves within the exception.
[153] The result, Mr Rzepecky submitted, of the decisions in The Hill Harmony is that decisions made by a master which are not bona fide do not amount to navigation or management of the vessel and are not capable of being within the exemption in Art 4 R 2(a). Mr Rzepecky also relied on the observations in the The Hill Harmony and the citations from authority as to the distinction between “management” and “navigation” to submit that navigation refers to matters of seamanship with management relating to commercial, economic, or legal aspects of ship operation, so owners must demonstrate a sufficient nexus between the master’s actions as a matter of seamanship and the safety of the ship, crew, and cargo to be entitled to the exemption. He submitted that “management” concerned whether the act or default causing the loss or damage was as part of the care of the cargo or the running of the
ship unrelated to cargo (Voyage Charters 3rd ed, para 85.274 p 1024). Only acts
intentionally, even if misguidedly, done in or incident to the management of the
vessel fall within the exception (Voyage Charters 3rd ed, para 85.77, p 1026). He contrasted that, as do the authors of Voyage Charters with actions done without regard to the management of the vessel, such as stevedores’ theft of a storm valve cover plate (Leesh River Tea Co. Ltd v British India Steam Navigation (the “Chyebassa”) [1966] 2 Lloyds Rep 173) and removal by a ship’s crew of an access hatch, probably to gain access to a stash of drugs during a voyage, which allowed water to enter the fo'c'sle and the hold causing damage to cargo (the “Bulknes” [1979] 2 Lloyds Rep 39, 41), both of which were held outside the exemption.
[154] In light of all of that, Mr Rzepecky said the plaintiffs rely on the misconduct of Captain Hernandez. He was motivated by a dishonest intention to try to absolve himself from responsibility for damaging the ship by taking the shortcut east of Biro Shima, and knowing of the grounding and the ship being damaged, nonetheless steamed at full speed for several hours, coupled with his fabricated story of the damage being caused through colliding with an unidentified floating object and at no time advising the coastguard. He also failed to organise the crew in an effective pumping regime with regular soundings and provided false information to Technomar as to the time and damage in the grounding. He submitted the master’s actions were for the ulterior purpose of trying to preserve his maritime reputation. He acted without regard for the safety of the ship, crew, and the cargo. His actions made the salvor’s task – particularly as far as on-deck cargo was concerned – significantly more difficult. Even if the captain’s actions came within the definition of “management” or “navigation”, the fact the master did not act bona fide to safeguard the interests he was bound to protect meant the exemption was not available to Tasman Orient as his employer. Art 4 R 2(a) was therefore, Mr Rzepecky submitted, inapplicable.
[155] He therefore submitted that the plaintiffs should be entitled to judgment for the combined claims for cargo losses of US$3,108,545.80, though he accepted that discussions between counsel and, possibly, a further hearing may be required to agree a breakdown as between plaintiffs in light of the balance of the limitation fund, the claims for salvage and General Average and the settlements.
(2) Defendant
[156] Mr Gray’s submissions first challenged the plaintiffs on the onus of proof. He submitted that if cargo resists the availability of an exception clause by reason of some alleged failure by the ship - for example, unseaworthiness – then the onus was on cargo to prove it.
[157] He carefully reviewed the history leading up to the compromise between owners and cargo interests represented by the Hague-Visby Rules noting that as long as owners exercised due diligence in making a ship seaworthy, both physically and with competent crew, they were entitled to rely on exceptions reflecting the risks arising from the common venture of sea voyages including damage arising from the act, neglect, or default of master and crew in the navigation or management of the ship. He drew on a forthcoming edition (now available on the internet) of
Prof Tetley’s work on Marine Cargo Claims (4th ed due for publication in 2008,
ch 16, p 1) that the defence is unique to ocean carriers, unique in transportation law, deliberately excluded from the Hamburg Rules and increasingly contested by critics of the Hague and Hague-Visby Rules. He relied on the “Bunga Seroja”. He also relied on the recent House of Lords decision in Jindal Iron and Steel Co. Ltd v Islamic Solidarity Shipping Co. Jordan Inc (the “Jordan II”) [2005] 1 Lloyds Rep
57 where their Lordships emphasised the importance of certainty in international trade law as transcending the dubious authority of a precedent decision, even one of long standing.
[158] Mr Gray submitted that the correct interpretation of Art 4 R 2(a) was that carriers have a duty to cargo interests to care for the cargo properly under Art 3. Even if damage arose as a result of want of care of the vessel indirectly affecting cargo, as long as the carrier exercised due diligence as to seamanship and provision of a competent crew, it is not vicariously liable for its servants or agents and not liable for loss or damage to the cargo under Art, 4. Tasman Orient took the stance it was not privy to any conduct of the master of “Tasman Pioneer” which caused the plaintiffs’ loss and was accordingly not liable. He drew on Scrutton (op.cit Art 118, p 238) that clearly expressed exceptions for the owners’ servants are given full effect “so that even the most culpable recklessness on their part will not render him liable”.
He made the point that the learned authors go as far as to state (at 241) that the exemption may apply even if the crew improperly abandoned the ship relying on Bulgaris v Bunge & Co. Ltd (1933) 45 Lloyds Rep 74, 81, though in that case the view was obiter and the case does not appear to have been favourably considered since. Further, the reliance on Art. 118 overlooks the author’s view (ibid) that “the tendency of the Courts is to construe this and similar exceptions strongly against the ship owner”.
[159] Though accepting Prof Tetley’s views earlier cited, Mr Gray noted the learned author says nothing as to the whether the intention or purpose of the master is relevant to interpreting Art. 4 R 2(a) though his commentary suggests actual fault or privity of the carrier is required.
[160] Mr Gray then presented careful and comprehensive submissions concerning the English common law at the time of the Hague Conference in 1921 and the Travaux Préparatoires of the Hague Rules but, with respect to counsel’s diligence, it is thought unnecessary to lengthen an already significant judgment by including that material.
[161] Mr Gray submitted that construing Art. 4 R 2(a) on the basis that the carrier is not vicariously liable for the master’s intentionally reckless conduct is consistent with the Hague-Visby Rules construed as a whole. He drew attention to the package limitation under Art. 4 R 5 where the carrier was only deprived of the limit for its act or omission, not that of the crew, and noted that no similar exclusion was added to Art. 4 R 2(a). He also drew attention to the observations of Callinan J in the “Bunga Seroja” (p 241-2, para [241], [242]):
It is immediately obvious that the Rules are intended to confer a very wide range of immunities upon carriers. Rule 1 strongly conveys the notion that liability should be sheeted home to the carrier only in respect of a want of appropriate care (due diligence) on its part. In some respects therefore, the specific instances of immunities set out in r 2, might be regarded as superfluous. Each of items 2(d), (e), (f), (g), (h), (j), (k), (l), (m), (n) and (p) in all or most cases would involve no fault on the part of the carrier. The notion that the carrier is not to be liable without actual fault is reinforced by (q). It seems to be going a long way, as (a) does, to exculpate the carrier from vicarious liability for its servants or agents in managing and navigating the ship. However, the antidote may be that the carrier does have a duty “to
properly man ... the ship” pursuant to Art III, r 1(b) and by doing that should be regarded as having fulfilled its obligations in that regard to the shipper.
Article IV, r 1 expressly imposes an onus (of proving due diligence) on the carrier when loss or damage has resulted from unseaworthiness. However, r 2 (except for r 2(q)) which operates to exonerate the carrier is silent as to who bears the onus, notwithstanding that most of the excepting events would be ones peculiarly within the knowledge of the carrier.
[162] Somewhat contrary to his submissions that Tasman Orient was not vicariously liable for the master’s actions, Mr Gray noted that a shipowner cannot escape the duty to navigate the ship with reasonable care by delegating navigation to the master because while there may be no contract between them, the master-servant relationship nonetheless exists, though the authority on which he relied related more to relationships between shipowners and pilots (where compulsory pilotage was required) than to masters (Esso Petroleum Co Ltd v Hall Russell & Co Ltd [1989]
1 AC 643, 690-1).
[163] However, Mr Gray relied on a decision of the German Federal Court of Justice in “C” (I ZR 20/04 26 October 2006). In that case the officer of the watch changed the vessel’s course then fell asleep and because the watch alarm was off only awoke once the ship ran aground and was about to sink. Mr Gray said the Hague Rules apply in Germany as part of the German Commercial Code. Despite the watch keeper’s nautical fault in turning off the alarm, the Court held the exemption applied even despite deliberate or negligent action by the crew. The “carrier is liable for damages that are caused by errors in navigating or otherwise managing the ship and that are attributable to him, [he] is not liable for the fault of others” (para 38, p 14 of translation) and ‘“Navigation’ ... includes all measures implemented by the crew with respect to locomotion of the ship” (para 40, p 15).
[164] Mr Gray submitted The Hill Harmony was distinguishable because the underlying premise of the majority arbitrator’s decision ultimately upheld by the House of Lords was that the master’s decision concerning the course he would take was made before the voyage commenced and was therefore part of his employment and not a response to circumstances arising during the voyage. Mr Gray submitted there were policy reasons for adopting that course: the master is subject to
supervision by the owner in port but once the voyage is commenced, all interests in the ship, crew and cargo are in the master’s hands.
[165] However, with respect to counsel’s arguments, it must at once be observed that although the place at which the decision was taken was discussed by their Lordships as part of their consideration of Owners of the Steamship ‘Lord’ v Newsum Sons & Co Ltd (1920) 2 Lloyds Rep 276 and although Bailhache J held in that case (at 279) that “management” excluded the deliberation by the master in port regarding the route by which he will proceed to his port of destination, Lord Hobhouse, in The Hill Harmony immediately went on to say (at 159):
The decision was no doubt correct but the reasoning is certainly confusing. The character of the decision cannot be determined by where the decision is made.
and Lord Bingham said (at 151) that :
The Judge, in my opinion, erred in his formulation of principle [but] I would not question his conclusion.
[166] Those observations made plain that decisions whether a master’s actions come within the exception as being matters of “management” or “navigation” are to be considered in all the circumstances unaffected by the location where the master’s decision under review was taken. (In light of developments in the law since it was decided, observations on this topic in B J Ball (New Zealand) Ltd v Federal Steam Navigation Co Ltd [1950] NZLR 954, 965, may no longer be authoritative.)
[167] Mr Gray submitted the decision of the Court of Appeal of Rouen in the “Lucile Bloomfield” and “Ronda” was consistent with that principle: the decision of the master of the holed vessel to delay employing tugs to avoid possible salvage costs was a decision made once the vessel was in port. The shipowner’s responsibility was because it was faute commerciale, as opposed to faute nautique. In his view of authority on this topic, Mr Gray termed the decision in the Bulknes as an “outlier” as Sheen J did not analyse the text of Art. 4, R 2(a) and said it was a (at
41) “misuse of language to say that the surreptitious opening of the hatch by a member of the crew is an act or default in the management of the ship”, and accordingly owners were liable. He also pointed to the fact it was an oral judgment
and the case is not discussed in any relevant text. That may be so, but Sheen J was an acknowledged master of Admiralty law, well versed in its detail, and even if he did not think it necessary to discuss Art. 4, R 2(a) in detail, it is not possible to conclude that he disregarded its applicability in the circumstances of that case.
[168] As had Mr Rzepecky, Mr Gray then referred to a number of cases concerning conduct which fell or did not fall within the scope of the exception. They included Kalamazoo Paper Co & Ors v Canadian Pacific Railway Co [1950] SCR 356 where a ship struck the sea bottom and was beached. Cargo interests sought damages on the basis that the captain failed to direct the use of all available pumping facilities. The shipowner was held entitled to the benefit of the exemption. The trial Judge held the master’s obligation to utilise full pumping capacity for the general safety of the ship and to prevent collapse of a bulkhead protecting the cargo was an act of management. Such acts of management were not displaced by obligations to cargo. Estey J held that the negligent operation of the pumps was irrelevant as (at 371) “they were operated for the preservation of and therefore were acts in relation to the management of the ship” and the fact that the pumping also was directed to the safety of the cargo did not take the case out of the exception of Art. 4, R 2(a) because the actions only incidentally damaged cargo. The joint judgment of Taschereau and Locke JJ held (at 380) that the failure to exercise diligence to prevent water entering into the forehold was negligence in navigation, as well as, possibly, in management.
[169] In Leval & Co Inc v Colonial Steamships Ltd [1961] SCR 221, [1961]
1 Lloyds Rep 560, a vessel collided with a canal bank and water was found in the No. 2 bilge, though no hole was then located. It was held that a more thorough investigation of the vessel would have revealed that she was holed earlier. The failure of the master to take steps to prevent further ingress was negligence in the management of the ship.
[170] In C H Smith & Sons Fellmongery Pty Ltd & Ors v Peninsular & Oriental Steam Navigation Co (1938) 60 Lloyds Rep 419, failure to take soundings in the hold was held to amount to neglect in the management of the ship and in The Washington [1976] 2 Lloyds Rep 453, the Art 4 R 2(a) exemption did not cover to
protect cargo where maintaining course and speed amounting to negligent failure to use the apparatus of the ship.
[171] Properly analysed, Mr Gray submitted, those cases were all examples of the principle that whatever the master does in management or navigation – even with an ulterior intent – remains within the exception in Art, 4, R 2(a).
[172] Applying those decisions to this case, Mr Gray submitted that the Art. 4, R 2(a) exception was available for all decisions of the master, including whether to anchor, whether to steam, direction of steaming, speed, whether to call the coastguard and when, what type of help to seek, and all other aspects criticised by the plaintiffs. He noted Captain Goodrich accepted those topics might either amount to navigation or management of the ship – though adhering to his view as to the irrelevance of motivation. He noted Captain Goodrich’s equivocation as to whether the decision to notify the coastguard was management of the vessel.
[173] Even if it were held that the master’s decisions and their motivation precluded Tasman Orient’s reliance on Art. 4, R 2(a), Mr Gray still submitted that there was an issue of causation to be decided.
[174] All the plaintiff’s cargo was stowed above deck. Both Messrs Colman and Boyd accepted that once the fo'c'sle deck was immersed, the capacity of salvors to improve the vessel’s trim markedly was significantly compromised, not least because that trim indicated the forepeak and void spaces had been flooded, probably downflooded. Despite the major pumping capacity ultimately employed by Nippon Salvage, including large pumps, barges and the like, beaching was required.
[175] Mr Gray carefully addressed the evidence bearing on when Nippon Salvage might have arrived at the casualty had early notification been given. He pointed out that any early notification would have been based on significantly less information than later became available. He was critical of Captain Goodrich’s list of
27 requirements for a master in those circumstances, making the point that only a small proportion could have been undertaken simultaneously. He stressed the panic from which the master said he was suffering. He emphasised that perhaps 20 to 30
minutes elapsed before water entered the holds. He made the point that Nippon Salvage seemed reluctant to move without LOF 2000 and only sent a small advance party by road, probably to get information. He pointed to Mr Hoskison’s evidence that salvors react more slowly when the information flow is modest. He made the point there was no evidence that the coastguard would necessarily have advised Nippon Salvage, still less immediately on receiving advice of the casualty. The actual anchorage was about an hour’s steaming closer to Moji than Sukumo Wan. Though more sheltered, there was no evidence the coastguard would have advised anchoring in Sukumo Wan, a submission, he suggested, supported by the fact that in the coastguard’s later investigation there was no suggestion they would have directed an alternative anchorage, still less where. All of that said, Tasman Orient accepted that the master did not alert the coastguard when he should have.
[176] He pointed to the fact that Captain Kuroki was dispatched by road to a position near the casualty because this was a “severe emergency”. He made the point there was no evidence the advance party took pumps with them or transferred any such equipment to the coastguard patrol boat.
[177] Mr Gray analysed the differences between Mr Hoskison and Captain Landelius as to what Nippon Salvage would have done had it received earlier notification, Tasman Orient, unsurprisingly, urging adoption of Captain Landelius’ evidence, given his experience. Mr Gray was critical of Mr Hoskison’s opinion that because portable pumps were available at Moji, they would have been dispatched without delay to Tasman Pioneer in advance of the arrival of the Seiha Maru No. 2. This did not occur even after LOF 2000 had been agreed. He suggested no salvor will commit resources to a project by mobilizing tugs, men and equipment before they know the job will eventuate. Nippon Salvage only began to mobilize in that fashion on learning of the ship’s condition at about 0930 on 3 May. Overall, he submitted, Mr Hoskison’s estimates were optimistic.
[178] Tasman Orient took the view that it was only remotely likely the deck cargo could have been saved had the master raised the alarm when he should. There was water on deck at 12:18pm and the f'o'c'sle was almost immersed by around 1500 hrs with the consequent effect on salvors’ ability to recover trim.
[179] Mr Gray made the point that Tasman Orient’s position was that computer modelling is only a guide to the rate by which the vessel’s trim by the head increased so as to damage deck cargo. Whilst the computer modelling was as accurate as the available data allowed, much data was missing and much may have been inaccurate. The soundings book was an example. The computer models made no allowance for swell. Even the size of the holes in the hull and bilge wells were deductions. Mr Boyd’s evidence that a range of modelled outcomes was the most appropriate was persuasive, particularly given varying estimates as to permeability of cargo. Mr Boyd calculated that increasing permeability in No. 2 hold from 53.6% to 56% explained Mr Colman’s 12:18 pm hour condition without flooding the void space at all. Photographic analysis must be cautious though Mr Gray suggested the 12:18 photograph was compelling evidence of sea water washing over the bow by that stage and the photographs at 1550 hours and 1530 hours show water clearly on deck. Therefore, he submitted, Mr Colman’s analysis that water was not on deck until after
1700 hrs was unsustainable.
[180] He suggested Mr Colman’s model of the water just over the bow at 1530 hrs was inconsistent with the salvors’ observations at 1450 hrs that seawater was “cutting the mid part of No. 2 cargo hold”, and the coastguard report that at 1530 hrs the water had “reached the upper section of the bow section bulwark”.
Discussion
(1) What should or would those actually or notionally involved have done, and when?
[181] Taking Tasman Pioneer on the route east of Biro Shima was, as even Tasman Orient agrees, unwise. Perhaps putting it more precisely, it was unwise for him to deviate when within the chosen channel with a defective radar and when conditions did not enable him to make the manoeuvre safely and know his situation.
[182] There was evidence that Captain Hernandez panicked. That may be understandable but there is also evidence that the panic was short-lived. He retained enough sangfroid to do some of the things his training and experience told him should be done in such circumstances. He gave orders to flood the SBTs to try to
correct the list. He gave orders to rouse the crew. He gave orders for the ship’s pumps to be operated. He gave the necessary orders for the ship to steam at full speed for over two hours on the course he chose until she anchored. And he retained sufficient cool-headedness to formulate the lie as to the cause of the casualty and persuade the crew to support him, at least initially, and do what was required, such as doctoring the chart, to provide supporting evidence.
[183] All witnesses agreed the master was obligated to notify the coastguard, owners or managers and, possibly, salvors.
[184] So the next question is: at what time should the coastguard have been advised of the casualty?
[185] After the grounding at 0255 hrs, Tasman Pioneer steamed for about another two hours until anchoring at about 0455 hrs. Although Captain Hernandez would not have known the extent of the damage, he knew his ship was significantly disabled. Witnesses varied in their views of the time by which the coastguard should have been informed, but, in this Court’s view, as seemed to be largely accepted Captain Hernandez should have made his first contact with the coastguard by
0315-0330 hrs, certainly no later. The information he could have given may have been sketchy but an accurate report would have included some advice of the severity of the impact and of the likely water ingress shown by the list. And it was of importance that contact be maintained to keep the coastguard informed of the ship’s changing circumstances. The coastguard is likely to have insisted on continuing contact.
[186] What would Japanese coastguard probably have done?
[187] As the evidence made clear, coastguard interest in casualties such as this mainly focuses on possible loss of life and pollution. The latter could probably not be assessed at that hour of the morning but the circumstances which should have been reported would have alerted the coastguard to its possibility and possible danger to the crew. In addition, the Japan Inland Sea is sufficiently heavily trafficked to have a traffic management system in place. Further, its coastlines
mention enough towns and cities to suggest the area is heavily populated. The Japanese Coastguard would clearly have treated as serious any report of a 22,000 tonne ship listing badly and steaming through a heavily trafficked though relatively sheltered area. Loss of life, pollution, disruption of other marine traffic, a possible foundering would in all probability have been in the coastguard’s mind.
[188] In light of that, it is highly probable the coastguard, with its local expertise, would have recommended reducing speed and making for the nearest sheltered anchorage with a shelving bottom in case beaching was required. Sukumo Wan met all those criteria.
[189] Would the coastguard have alerted Nippon Salvage?
[190] The circumstances described and the possible outcomes are likely to have been seen by the coastguard as sufficiently serious at least to have warranted informing Nippon Salvage of the information they had been given within a short time after it was received and the circumstances were such that it is highly probable that Nippon Salvage would have contacted Tasman Pioneer, either directly or via the coastguard in order to ascertain the fullest detail available of the casualty and other relevant information including contact details for the manager, owner and P & I Club. It would then have made contact with them and offered its services.
[191] Would it have mobilized fully at that hour?
[192] The answer cannot be clearcut since it is hypothetical but the likelihood is that Nippon Salvage would have commenced mobilizing its crews immediately on receiving information concerning the casualty whilst seeking additional information and, probably, endeavouring to negotiate LOF 2000 with managers and the P & I Club. Even though the full seriousness of the damage would not have been known, Nippon Salvage would have recognised that a 22,000 tonne ship in the Japan Inland Sea had suffered what must have been significant damage, was taking water and listing, and would have begun mobilizing to suit. This is the appropriate conclusion, given the fundamental voluntariness of salvage, given that Mr Hoskison said that is what salvors do and Captain Landelius did not disagree except as to timing, and
given that Nippon Salvage would have sensed a job – perhaps, as turned out to be the case, a substantial job - in the offing. In light of all that, it is likely Nippon Salvage would have commenced mobilization between 0330-0400 hrs.
[193] The most reliable indicator of the time required for mobilization is the
1:30 hrs actually taken when Nippon Salvage did mobilize later on the morning of
3 May. Had mobilization been several hours earlier, as Mr Hoskison said, it may have been quicker having regard to the traffic problems the salvors later encountered, but, giving Tasman Orient the benefit of that period, on this basis Nippon Salvage would have been mobilized and ready to leave its bases by about
0530 hrs.
[194] When would salvors and pumps have reached Tasman Pioneer?
[195] Again, the times actually taken are the best guide, though adding an hour for the additional steaming required to reach Sukumo Wan.
[196] Seiha Maru No.2 reached Tasman Pioneer in 7:40 hours steaming. Had she left Moji at 0530 hrs and steamed for 8:40 hours she, with her large portable pumps and significant pumping capacity, would have reached Tasman Pioneer about
1410 hrs. Hayashio Maru No.2 took 9:50 hours to reach Tasman Pioneer. Had she
left Imabari at 0530 hrs her 10:50 hour journey would have resulted in her being at Tasman Pioneer by about 1620 hrs. Captain Kuroki and his party took 4:55 hours to reach Beppu and embark on the patrol boat for a voyage of two hours to Tasman Pioneer. Their trip would have been shorter without later holiday road congestion but, again giving Tasman Orient the benefit of the calculation plus the additional hour, had they left Moji at 0530 hrs their 7:45 hour journey meant they would have been at Tasman Pioneer by around 1315 hrs. In short, on this hypothetical scenario, all the actions taken on 3 May relating to salvage would have occurred some 5-6 hours earlier than they in fact did, though adjusting that figure for the extra hours’ steaming required.
[197] Even allowing a certain leeway in those hypothetical calculations, the appropriate conclusion is that salvors with pumps would have been available to
Tasman Pioneer within about two hours after the 1218 hrs photo, the Seiha Maru No.2 with its major pumping capacity and heavy portable pumps would have been on site and deploying pumps well before the 1530 hrs photograph and the Hayashio Maru No.2 would have arrived about an hour after that photograph was taken.
[198] Even if that hypothesis is allowed a little further latitude and the extra pumping capacity not arrived until a little after the times mentioned, the same conclusion would be appropriate. The ship was only sinking relatively slowly and accordingly, if the extra pumping capacity had not been deployed even up to the
1550 hrs photograph condition or, possibly, even a little later, the plaintiffs’ on-deck cargo would not have been inundated.
[199] The various pumps would have been deployed progressively over the following hours but on this scenario assistance additional to the ship’s pumps would have been available from, say, 1410 hrs at the latest with major pumps being successively deployed from about 1500-1530 hrs on. What actually happened was that pumping began within 45 minutes of Seiha Maru No.2’s arrival with larger pumps deployed progressively thereafter.
[200] It is noted that the defendant did not contest that, once Nippon Salvage were on site, their salvage efforts were everything that could be expected and accordingly they did all they could to assist the ship irrespective of their time of arrival.
[201] What would Tasman Pioneer’s condition have been when that additional pumping capacity began to come on stream?
[202] It was clear from the 0950 hrs photograph (Annexure 4) that, though markedly trimmed by the head, her bow and thus the fo’c’sle and other decks were well above sea level. Her name was fully visible and even a swell of 1-2m is unlikely to have deposited more than spray on deck. On-deck cargo was not then in danger of inundation for some hours to come.
[203] By the 1218 hrs photograph the ship’s condition had materially worsened. For reasons elsewhere discussed, interpretation of that (and other) photographs is
difficult but it is clear that all or nearly all of the fo’c’sle deck was not immersed though crests of the swell may have been coming over the bulwark. Other decks and on-deck cargo were not in immediate danger of immersion.
[204] What would appear to be the low elevation from which the photographs was taken and intervening swell makes the 1530 hrs and 1550 hrs photographs somewhat difficult to interpret and reconcile, but it is clear that, at least at times, part of the ship’s name was above sea level though, by that time, it seems probable that the fo’c’sle deck would have been awash, at least as the crests of the swell went past and some photographs suggest the break between the fo’c’sle and main deck may have been awash. That may be true but, since the on-deck cargo sits on coamings about
1m high it seems unlikely it was being inundated by that time.
[205] In that regard, it is critical to bear in mind that all the plaintiffs’ cargo was stored on deck. It is true, too, that this scenario made Nippon Salvage’s efforts more of a race against time to save the on-deck cargo, but the appropriate conclusion from the available evidence is that on this hypothetical scenario salvors, tugs and significant pumping capacity would have been on station and deploying pumps somewhat earlier than 1530 hrs.
[206] Those views largely reflect Mr Colman’s calculations and the views of Captain Goodrick and Mr Hoskison. Mr Boyd, Captain Landelius and Mr Todd all took a rather more pessimistic view of the ship’s condition as shown in the 1530 hrs and 1550 hrs photographs, but their views were not markedly more pessimistic and depended significantly on the Arita Maru’s comments recorded by Captain Kuroki that when it arrived at about 1450 hrs “the casualty was heavily down by the head such that the seawater was cutting the mid part of no.2 cargo hold”.
[207] The Court’s findings do not overlook those statements but, while they may reflect the occasional swell, their accuracy is dubious. Incontestably, at times at least, the ship’s name was above water as shown in the 1530 hrs photograph, as was most of the fo’c’sle deck. The Arita Maru’s comments also sit uncomfortably with the salvor’s photographs. One taken on deck at 1928 hrs does not, even then, show immersion to the extent suggested in the Arita Maru’s comments. In addition, it is
notable that in Captain Kuroki’s near contemporaneous record of the information conveyed by the Arita Maru there is no reference to the casualty being “heavily down by the head”. That statement only appeared in his witness statement signed about 17 months after the casualty. Its omission from the salvage diary and site reports suggests the comment may not have been made at the time Arita Maru reached Tasman Pioneer.
[208] Because witnesses for Tasman Orient and the defendant itself placed significant reliance on the Arita Maru’s comment, it is pertinent to say a little about the factual evidence adduced in this case.
[209] No witnesses as to fact were called other than a Mr Todd who inspected Tasman Pioneer from 8 August 2001. All the evidence as to fact came from Japanese coastguard interviews and other reports generated at about the time of the casualty and in the following days. Those from salvors and coastguard officials were originally, of course, in Japanese. Those from crew including Captain Hernandez appear to have been given in English – though the Filipino crew’s discussions concerning the lie were in Tagalog - translated into Japanese for the purpose of the investigation and then re-translated into English for the purpose of this case. It therefore seems that the coastguard investigations were conducted in English, a language unlikely to have been the first language of any of the participants. In addition, lack of timing of the transcripts means it is not possible to determine whether they were continuous, but deletions suggest that not to be the case.
[210] Other evidence, such as the salvor’s diaries, has only been translated once.
[211] It follows that, whilst the translators have doubtless done their conscientious best, caution is required when considering the statements if for no other reason than possible loss of detail and accuracy through the single or double translations. In addition, of course, none have been tested in cross-examination.
[212] That caution applies with especial reference to the Arita Maru’s “cutting the mid/middle way” statement since it was plainly hearsay when recorded, apparently some little time later, by Captain Kuroki and is equivocal: what did the speaker
mean by “cutting the mid/middle way”? Was it enduring or occasional? On how much observation was it based? What was the salvage experience of the speaker? Questions such as those mean, therefore, while the statement is of importance, too literal a reliance on it would be inadvisable and, as earlier noted, there must be doubt as to whether the “heavily down by the head” remark was made at all. Even if it was, it was made to Moji base who must have relayed it to Captain Kuroki. Its reliability is therefore highly suspect.
[213] Returning to consideration of the main questions in the case in light of that, have the plaintiffs proved that early notification by Captain Hernandez to the coastguard and owners/managers and, possibly, salvors, would likely have resulted, in this hypothetical situation, to their on-deck cargo not being lost through water damage?
[214] In the light of all those matters, the answer must be that the plaintiffs have proved that early and proper notification by Captain Hernandez to the authorities would likely have resulted, hypothetically, in their on-deck cargo not being lost through water damage. There would have been significant pumping capacity additional to the ship’s pumps available and progressively deployed before the sea level reached on-deck cargo.
(2) Were Captain Hernandez’ actions in the “navigation” or
“management” of the ship?
[215] As the earlier review of authority shows, whether the “act, neglect or default of the master” is in the “navigation” or “management” of a ship and thus whether the ship or the carrier are entitled to the exemption in Art 4 R 2(a) of the Hague-Visby Rules has been a vexed and litigation-provoking topic throughout the history of the Rules. The results have often been fact-specific.
[216] Such is certainly the case here where counsel were unable to find a precedent which closely parallels the present facts.
[217] Reduced to its essence, there are two main aspects of Captain Hernandez’
actions under scrutiny: the decision to transit the passage east of Biro Shima and try
to abort the transit mid-way, and the decision not to advise the coastguard and owners/managers as soon as should have been the case but to carry on to the point of anchoring. Both are held to have played a causative role in the ultimate damage to on-deck cargo.
[218] Was what Captain Hernandez did in and around each of those two broad categories of action a matter of “navigation” or “management” of the Tasman Pioneer?
[219] The passages earlier cited from Scrutton and Tetley drew the distinction between a “neglect to take reasonable care of the ship ... as distinct from the cargo” and faulte nautique as opposed to faulte commerciale, navigation and management in the former and fault in care of the cargo in the latter. Tetley helpfully defined the three possible categories of error in navigation or management, in care of the cargo and in respect of both ship and cargo. Prof Tetley says that “if both ship and cargo have been affected by the same error then the carrier is usually exculpated”.
[220] Seen against that background, Captain Hernandez’ action should properly be seen as affecting both ship and cargo. The circumstances leading up to the grounding are certainly a failure on his part to take “reasonable care of the ship” that jeopardised and ultimately damaged on-deck cargo. The decision not to report the grounding for some hours but to continue the passage with a significantly damaged ship was likewise in the circumstances a navigational failure to take reasonable care of the vessel and a series of actions which, as the trim worsened, increasingly jeopardised and ultimately damaged the on-deck cargo. The whole of Captain Hernandez’s actions should therefore, though in differing proportions, be properly seen as errors affecting both ship and cargo, thus leading to a finding, as Prof Tetley says, that the ship should normally held to be entitled to the exemption provided by Art 4 R 2(a).
[221] Seen in that light, further categorisation and whether the actions were in the course of the master’s “navigation” or “management” of Tasman Pioneer may be superfluous since, as the authorities show, actions of masters are often a mix of both. Provided masters’ actions are either “navigation” or “management” of the ship, it
matters not into which category they fall or whether the actions fall into both as the exemption under Art 4 R 2(a) applies..
[222] However, if further definition is appropriate, Gosse Millard and The Hill Harmony assist. In the former, Greer LJ held that the shipper’s paramount duty to carry cargo safely was only excused if cargo damage was the “indirect result of any act or neglect” which could arise through “negligence in caring for the safety of the ship” or “failure to take care to prevent damage to the ship” or “failure in the management of some operation connected with the movement or stability of the ship”. The shipper was liable if damage was caused “solely, or even primarily, [by] a neglect to take reasonable care of the cargo” but not liable if what occurred was “only negligent failure to use the apparatus of the ship for the protection of the cargo”.
[223] Seen against that definition, Captain Hernandez’ action in taking the passage he did, failing to report for a lengthy period and probably failing to utilise the ship’s pumps to the full, could not be seen as “solely, or even primarily, a neglect to take reasonable care of the cargo”. The cargo was indirectly damaged by the master’s primary negligence in failing to care for the ship by preventing damage to her or in managing both her movement or her stability by employing her pumps to best advantage. Cargo was only indirectly damaged by the primary negligence. On the authority of Gosse Millard the Tasman Pioneer was entitled to the exemption in Art
4 R 2(a) the master’s actions being matters of “navigation” though it might also be said that failure to utilize the full pumping capacity was a failure to use the ship’s apparatus and thus a matter of “management”. Either entitle Tasman Orient to the exemption.
[224] The same result is indicated by The Hill Harmony. Captain Hernandez’ action could not be said to be “exploitation of the earning potential of the vessel” but matters of seamanship and thus coming within Lord Hobhouse’s definition of “navigation”.
[225] Other cases earlier reviewed also indicate the same result. In terms of the
Lualle Broomfield and Ronda, Captain Hernandez’ actions were primarily faute
nautique by the master. It is noteworthy that the master’s actions in Kalamazoo Paper, a case with a certain factual similarity to the present, were held to be acts of management of the ship.
[226] The proper conclusion to this point is accordingly that Tasman Orient has satisfied the burden of proof on it of demonstrating its entitlement to the exemption provided by Art 4 R 2(a) of the Hague-Visby Rules.
(3) For Art 4 and R 2(a) of the Hague-Visby Rules to Exempt Carriers must any Act, Neglect or Default in the Navigation and Management of the Ship be bona fide for those purposes?
[227] That, however, is not the end of the matter because Mr Rzepecky argued that the exemption in Art 4 R 2(a) does not apply unless the “act, neglect or default of the master” was bona fide in the “navigation or in the management of the ship” and that Captain Hernandez’ actions which led to the grounding and followed it sprang from his ulterior motive of trying to camouflage what he had done in an endeavour to avoid blame and were accordingly not bona fide in navigation or management.
[228] The necessity for a demonstration of good faith is not, of course, addressed in Art 4 R 2(a) and, as the earlier review of authority shows, the suggested necessity for the actions of those responsible for the ship being carried out in good faith has not invariably been addressed by Courts.
[229] The Hague-Visby Rules do not deal with the topic and the Travaux Préparatoires are unlikely to be helpful: they are “rich in ambiguity” (J I MacWilliam Co Inc v Mediterranean Shipping Co SA (“The Rafaela S”) [2003]
2 Lloyds Rep 113, 127 para 59) and although the Travaux can be used for interpretation if they “indisputably point to a definite legal intention” it has been said that “only a bull’s eye counts” (Effort Shipping Co Ltd v Linden Management SA [1998] UKHL 1; [1998] AC 605, 623 per Lord Steyn) and Treitel and Reynolds: Carver on Bills of Lading (2nd ed 2005 para 9-098 p 546) say that “judgments so far suggest that it is unlikely that a bull’s eye will often be scored”.
[230] Further, the fact that the issue of good faith has only infrequently been addressed in precedent cases may arise from the fact that the fides of those responsible for the ship has not often been challenged. Even so, judicial discussions as to whether the actions in contention were in “navigation” or in “management” of the ship and thus Art 4 R 2(a) applied appears to have been based on the underlying premise that, no matter into which category the master’s actions fell, they must still have been undertaken in furtherance of the master’s paramount duty of safely caring for the ship, cargo and crew.
[231] The Hague-Visby Rules imply such a premise. They require carriers to “exercise due diligence” (Art 3 R 1(a)) and rescind the exemption for “want of due diligence” (Art 4 R 1).
[232] They require the carrier to “properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried” (Art 3 R 2). They exempt shippers from responsibility for actions without their “act, fault or neglect” (Art 3 R 3). That the exemption in Art 4 R 2(a) is not absolute is indicated by comparing the exemption from responsibility under that Rule as contrasted with exemption from “all liability whatsoever” under Art 3 R 6. All of that presupposes that the carrier’s intention or actions must be in furtherance of its obligations under the Rules and in particular the obligation under Art 3 R 2.
[233] In addition, authorities have addressed the question of fides on occasions. The Star of Hope spoke of a master’s “honest intent to do a duty”, Boudoin spoke of a master’s “good faith judgment”, Phelps, James & Co spoke of a master “acting bona fide” and, from a different view of the matter, the theft of the storm valve and removal of the access hatch in The Chyebassa and The Bulkes were acts of the crew so unrelated to management as not to be characterised as such. Further, in The Hill Harmony the Court of Appeal spoke of the master having a “duty to reach a bona fide decision”. That issue does not appear to have been expressly addressed in the House of Lords but, though reversing the Court of Appeal, there is no reason to suppose their Lordships departed from the Court of Appeal’s observation about the master’s bona fides since there was little doubt the actions of the master of The Hill
Harmony were taken in an honest though mistaken view of what he was entitled to do in the navigation of the ship.
[234] There is accordingly both logic and authority for the proposition that the “act, neglect or default” of those in charge of the ship must be bona fide “in the navigation or in the management of the ship” to entitle the carrier to the Art 4 R 2(a) exemption. There would seem to be every reason to read a good faith requirement into the Rule to entitle the carrier to qualify for the immunity from responsibility the Rule provides. That is the case irrespective of whether a lack of bona fides is seen as underpinning entitlement to the exemptions provided by the Rules or whether “navigation” or “management” which is not conducted bona fide in accordance with the master and crew’s paramount obligation to care for the ship, cargo and crew safely is so antithetical to that paramount obligation and proper seafaring practice as not to be regarded as qualifying or amounting to “navigation” or “management” under the Rules.
[235] While it has been held that Captain Hernandez’s actions were in the navigation or in the management of the Tasman Pioneer, it therefore becomes necessary to consider whether they were bona fide for her navigation or management.
[236] There can be little doubt that the master’s initial decision to use the passage east of Biro Shima was motivated by good faith. He was endeavouring to save time and keep to schedule as the ship’s managers required. He had used the passage before. Had it not been for the conditions, including the failure of the radar, and his decision to try to abort the passage, it may have been accomplished successfully.
[237] Even the decision to abort the passage, though probably arising from panic, should be seen as a navigational decision reached in good faith.
[238] The same cannot be said of the decisions and actions taken by Captain
Hernandez after the grounding.
[239] What he did was earlier recounted. What he failed to do was take a number of the other actions Captain Goodrick said a trained and conscientious master would take in such situations. In particular, he never complied with his duty to notify the coastguard of the casualty and the ship’s position and condition. He also failed for what on his own admission was over two hours – and was probably longer - to comply with his obligation to report the casualty to the ship’s managers and, when he did report, he said nothing about the cause of the reported water ingress, nothing about the grounding, and minimized the damage to the ship. Later Technomar telexes show Captain Hernandez was persisting in his lie as they say the “master believes that vessel hit an unidentified object”.
[240] None of those actions can have been motivated by Captain Hernandez’ paramount duty to the safety of the ship, crew and cargo. None could have been motivated by his obligations as a master, particularly the obligation to report and take whatever steps were recommended to minimize the danger to life, to navigation and avoid the risk of pollution. All those actions can only have been motivated by Captain Hernandez implementing a plan designed to absolve himself from responsibility or blame for the grounding and lend a veneer of plausibility to his falsehood.
[241] It follows that while what happened just before the grounding and for several hours afterwards may have been an “act, neglect or default of the master ... in the navigation or in the management of the ship” his actions did not amount to an “act, neglect or default” in the bona fide “navigation or in the management of the ship”.
[242] Accordingly, Tasman Orient has failed to discharge the burden of proof of demonstrating its entitlement to the exemption provided by Art 4 R 2(a) of the Hague-Visby Rules as correctly construed. The plaintiffs are accordingly entitled to judgment against the defendant for breach of contract and breach of bailment. In those circumstances, it is unnecessary to consider the claim in negligence and whether concurrent liability lies in this case. (Hague-Visby Rules Art R 4 bis R 1).
(4) Vicarious Liability
[243] As mentioned, Mr Gray raised the question as to whether Tasman Orient was vicariously liable for Captain Hernandez’ actions. There was no evidence directed specifically to the issue, it did not appear to be pleaded and Mr Gray dealt with the point briefly and with scant reference to authority. Mr Rzepecky did not deal with the point at all, no doubt because of the factors just mentioned.
[244] As outlined at the commencement of this judgment, Tasman Orient was the sub-charterer of Tasman Pioneer from Tasman Orient Line (Cyprus) Ltd at the time of the casualty . Clause 3 of the sub-charter incorporated the terms of the head charterparty and obliged Tasman Orient as sub-charterer to observe the head charterparty terms.
[245] The sub-charter said nothing about liability for crew but the time charter obligated Rimba Shipping as owner to meet crew wages and other costs and provided, in cl 8:
The Captain (although appointed by the Owners), shall be under the orders and directions of the Charterers as regards employment and agency; and Charterers are to load, stow, trim, lash, secure, unlash, tally and discharge the cargo at their expense under the supervision and responsibility as far as vessels seaworthiness is concerned of the Captain ... (Emphasis in original)
with cl 11 giving the charterers power to give the captain “all requisite instructions and sailing directions”.
[246] Under the Hague-Visby Rules Art 1(a) both owner and charterer are included in the definition of “carrier”, and it is the “carrier” on whom most of the rights and obligations under the Rules devolve, including the obligation to properly man the ship and carefully carry and discharge the cargo (Art 3 R 1(b)(2)). It is the carrier’s obligation to make the ship seaworthy and ensure it is properly manned but it is both the carrier and the ship which are exempted from liability unless damage is caused by want of diligence on the carrier’s part (Art 4 R 1) with the burden of proof being on the party claiming exemption. Both the carrier and the ship are entitled to the Art 4 R 2 (a) exemption.
[247] Authorities demonstrate that shipowners as their employers are vicariously liable for the negligence of the master and crew (Simpson & Co v Thomson Burrell (1877) 3 AppCas 279, 293) but if the charterer employs the crew it is the charterer who is vicariously liable for its employees’ negligence.
[248] In Baumwoll Manufactur von Carl Scheibler v Christopher Furness [1893] AC 8, 17, Lord Herschell said:
But there may be two persons at the same time in different senses not improperly spoken of as the owner of a ship. The person who has the absolute right to the ship, who is the registered owner, the owner .... But at the same time he may have so dealt with the vessel as to have given all the rights of ownership for a limited time to some other person, who, during that time, may equally properly be spoken of as the owner. When there is such a person, and that person appoints the master, officers, and crew of the ship, pays them, employs them and gives them the orders, and deals with the vessel in the adventure, during that time all those rights which are spoken of as resting upon the owner of the vessel, rest upon that person who is, for those purposes during that time, in point of law to be regarded as the owner.
[249] Seen in that light, Tasman Orient was an “owner” of Tasman Pioneer under Art 1(a) of the Hague-Visby Rules and under Baumwoll. Tasman Orient was obliged to observe the terms of all the charterparties. There were cross-indemnities within them. Although Rimba Shipping may have been obliged to meet crew wages, Captain Hernandez was subject to Tasman Orient’s directions. It gave him directions and he reported regularly to it. Therefore, although the result may differ as between Rimba Shipping, Tasman Orient Line (Cyprus) Ltd and Tasman Orient, as between the plaintiffs and the defendant, the defendant must be held to be vicariously liable for Captain Hernandez’ actions. This point accordingly fails.
(5) Unseaworthiness
[250] In light of the finding of breach of contract and breach of bailment, it may be superfluous to deal with the allegation of unseaworthiness, but, for completeness, the Court’s views should be recorded.
[251] The plaintiffs allege that Tasman Pioneer was unseaworthy at the commencement of the voyage and at the time of the casualty because of corrosion of the pipe through the transverse bulkhead into hold no.3, the fact that the void space
flooded when it should have been watertight, corrosion in the gantries and walkways and poor condition of the hatch-cover locking mechanisms and watertight seals.
[252] It is convenient to consider that question through the evidence of Mr Todd, the principal witness for Tasman Orient who dealt with the defendant’s denial of the plaintiffs’ unseaworthiness assertions.
[253] Mr Todd’s view, in brief, was that Tasman Pioneer was seaworthy. That condition was mainly testified by her remaining afloat despite serious hull damage.
[254] In reaching his view, he relied on, or was referred to, a number of reports, the earliest of which was a pre-loading inspection at Tauranga in the days leading up to
14-16 April 2001 of Tasman Pioneer’s steel cargo by Captain Roberts.
[255] Captain Roberts – whose evidence was restricted to putting in her report - was employed by Tasman Orient and others to survey the steel cargo. Her report recorded a recent satisfactory hose test on the hatch lids and satisfactory inspection of hold access, hatch-locking mechanisms, sealing rubbers and coaming drains. Inspecting bays 13 and 15 she made no note of wasting of bulkheads or corrosion of pipes. She was not called on to inspect other void spaces and although she recorded “gear problems” in relation to machinery and equipment, she was unable to recall the reason for that entry.
[256] Mr Todd also relied on a cargo condition survey carried out by a Mr Utsunomiya, a marine surveyor with 25 years’ experience, done on 1 May 2001 at Yokohama at the request of Tasman Orient concerning wet damage on some of the fibre board stowed in no.4 TD(S). He found nos. 2, 3 and 4 hatches tightly secured with watertight hatch covers with no trace of seawater having entered the holds despite four days of “boisterous weather ... accompanied with very high seas” with the vessel “shipping seas over decks frequently” en route to Yokohama.
[257] The third report was by a Mr Kawasaki, a marine engineer for many years and, from 1992, a hull surveyor with Scandinavian Underwriters Far East Agency Co Ltd (SCUA) in Kobe, Japan. He inspected Tasman Pioneer on 11 June 2001 in
dry dock in the Onomichi dockyard and described the then condition of the hull, machinery and fittings. Amongst his many photographs were three taken in the void space. One said an area of the void space was “wholly rusted”, another of the space itself was labelled “ditto” and the third showed some polypropylene multi-plait mooring ropes in the space.
[258] Fourthly, Mr Todd gave evidence on classification certificates dated 6 March
2001 by Germanischer Lloyd for the vessel (when she was Pioneer Ark) which certified that the “condition of the structure, machinery and equipment ... were satisfactory and the ship complied with the relevant requirements” although four notices of the same date spoke of repairs having been carried out to the FPT, APT side WBT nos.2, 3 and 4 (P) (S) where frames were “thinned and holed”. The report described the repairs to those and other tanks. The tanks were required to be internally examined at next annual class survey. The report also noted “several holed airpipe heads removed”.
[259] Finally, Mr Todd relied on his own inspection between 8-11 August 2001 at the Onomichi dockyard under the guidance of the new master, the chief officer at the grounding.
[260] Mr Todd found tide marks in the no.2/no.3 cranehouse consistent with the decks submerging to that point, which would also have submerged the port and starboard forward bilge sounding pipes to the no.3 hold. He found various air and sounding pipe vents blanked off or removed, he presumed during salvage. The air and sounding pipes passing through and serving the bosun’s store, void space and FPT were in sound condition. He saw no wastage or corrosion in the cargo hold bulkheads, the tank tops or the cargo holds he was able to inspect. The no.3 hold forward transverse bulkhead was in sound condition with the hold showing a faint tide mark up to 47cm reducing in depth leading aft. All air and sounding pipes passing through no.3 hold appeared in sound condition though one air pipe in the starboard forward region of the tween deck had been recently repaired, presumably after the grounding.
[261] The allegations that ladders, gantries, cargo holds, bulkheads and tank tops were corroded and wasted were inconsistent with Mr Todd’s findings and the vessel’s survival despite extensive flooding. He said Tasman Pioneer survived the casualty principally because the nos.2/3 hold transverse bulkhead was sound. Water may have entered the no.3 hold by way of defects in the starboard, forward DBT air pipe, probably repaired after the grounding, and the submergence of the associated air vent head on the main deck, although most of that water would have ingressed via the DBT. Water may also have ingressed the no.3 hold through the cargo hold bilge sounding pipe or the cargo hold access hatch, both of which were only weathertight, not watertight, and had been submerged.
[262] The bosun’s store was weathertight. The void space below was watertight though served by a weathertight air vent head above deck. Mr Todd saw nothing on his inspection to suggest the bosun’s store and void space were unseaworthy or failed to meet Classification Society rules, or that either space flooded through corroded pipes and bulkheads as alleged. Given the degree of submergence forward, his view was that downflooding of the bosun’s store and void space would have inevitably occurred through their respective closing appliances. Flooding of those spaces in those circumstances did not, in Mr Todd’s opinion, make the vessel unseaworthy.
[263] Similarly, Mr Todd said the pleaded condition of the weathertight hatch covers locking mechanisms and seals was inconsistent with the surveys at Tauranga and Yokohama and conditions during the passage. He also took the view the condition of the hatch covers and securing arrangements was irrelevant since flooding of the nos. 1 and 2 holds occurred from below, to the point where the vessel’s trim ensured submergence of the hatch covers.
[264] Mr Todd said the salvor’s diary confirming difficulties in pressurizing the FPT through air leakages may have occurred through incomplete closure of the weathertight hatch access to the void space or air leaking from a cable gland. He also accepted that a breach in the steel work between the FPT and the void space, even a small breach, might be a cause.
[265] In cross-examination, Mr Todd accepted that if water entered the holds through corroded pipes which were in that condition prior to the casualty, that would be an item of unseaworthiness and the holds would not be cargoworthy.
[266] Discussing Mr Kawasaki’s photographs of the bosun’s store and void spaces, Mr Todd said they depicted little evidence of corrosion in the former but disputed the description of the latter as being “wholly rusted”. He stressed the photographs showed no corrosion holes, or loose rust scale. The general view showing localized areas of surface corrosion in the void space photograph was misleading in extent due to camera flash. Mr Kawasaki, he thought, was only talking about surface not structural rusting.
[267] Mr Todd was cross-examined about a report of Nippon Kaiji Kentei Kyokai, a well-known and respected survey company which was on board the Tasman Pioneer from 19-25 May 2001 when she was at Kokura. It spoke of air ventilation pipes from the no.3 DBT being rusty, many of the hatch cleats being bent or corroded as were almost all of the compression bars on the top of the hatch coamings, with the top itself rusted and the top of the air pipe with the no.3 lower hold “had come off due to corrosion and rust”. Though refused access to the no.3 hold by the owner, NKKK “considered the sea water entered no.3 cargo hold through many defective parts of the hatch cover construction, the side bulkhead tank top plate and/or pipe line construction”. They found the “vessel’s hull to have been excessively corroded in poor condition” and found the “starboard air pipes of the no.3 cargo hold were corroded and heavily rusty”. They concluded:
The vessel was very old and in poor condition with heavy corrosions and we have strong doubts about the seaworthiness and cargoworthiness of this vessel even at the beginning of this voyage.
[268] Mr Todd said he had difficulty reconciling the accuracy of that report with his own later observations, perhaps, he suggested, due to translation error. Damage during and after the grounding may have given rise to the comment. He said the NKKK report of the hull being excessively corroded and in poor condition was “such a generalized comment as to be of little technical value”.
[269] Despite all the matters put to him, Mr Todd adhered to his view that there was “no indication that the vessel was unseaworthy in any way”.
[270] On the issue of unseaworthiness, Mr Rzepecky relied on Mr Coleman’s opinion that the void space should have remained watertight, though he submitted this was not a major issue since, if the plaintiffs’ view of the evidence were accepted, it is unlikely the void space would have flooded as the ship would never have sunk sufficiently for such to occur.
[271] He also relied on Mr Coleman’s view that hold No. 3 should never have flooded. The fact it did, he submitted, raised an issue whether the ship was seaworthy.
[272] Mr Todd’s inspection of the No. 3 hold left him unable to rule out the possibility water leaked into it through corroded pipes though he doubted the flooding into No. 3 hold had any causative effect. This was contradicted by Captain Landelius’s final report as SCR. The plaintiffs took the view that water entered no. 3 hold and the void and other spaces through corroded pipes or steelwork. He relied on the time Nippon Salvage took to pressurise the FPT and the Germanischer Lloyd forms that steelwork was done for corrosion purposes. Contrasting the photographs of the bosun’s store and the void space showed much more extensive corrosion in the latter which Mr Coleman assumed showed sea water had been leaking into the void over time.
[273] On unseaworthiness and as to the suggestion that the No. 3 hold and the void space allowed water ingress, Mr Gray noted No. 3 hold was not ruptured, though some water entered. It was speculation that this occurred through corroded pipes passing through the flooded No. 2 hold. Mr Todd accepted this was possible but had been unable to investigate it. None of the plaintiffs’ cargo was damaged as a result of water entering No. 3 hold. Therefore there could be no conclusion that Tasman Pioneer was unseaworthy because of any defect in the piping into the No. 3 hold.
[274] As to the void space and the suggestion of corrosion, Mr Gray rehearsed the evidence as to whether the void space suffered from downflooding after the fo'c'sle
deck was below sea level with water passing through the bosun’s locker. Mr Todd saw no unseaworthiness in the void space or the bosun’s store when he surveyed the vessel in August 2001. In particular, he saw no source of water which would have passed through an aperture of 170 mm diameter, that postulated by Mr Colman. Mr Todd did not rate the salvor’s difficulty in pressuring the FPT as important given the gravity of the casualty. Naturally he relied on Mr Kawasaki’s SCUA report of June 2001 where he gave no indication of seeing structural rust inside the bosun's store or void space. Those spaces did not require repair. Mr Kawasaki’s use of the expression “wholly rusted” was probably a reference to surface rust. In this regard, too, he relied on the lack of reference to rust in the void space in the classification documents. He also relied on Ms Roberts and the other surveyors’ reports.
[275] Finally, Mr Gray made the point that the burden of proof is on claimants to prove a vessel’s unseaworthiness before and at the beginning of the voyage and their loss or damage was caused by that unseaworthiness. If that be proved the burden passes to defendants to prove that they and those for whom they are responsible exercised due diligence to make the ship seaworthy and if they fail so to do, they are not entitled to rely upon the exception in Art. 4, R 2(a). In Papera Traders Co Ltd v Hyundai Merchant Marine Ltd (The “Eurasian Dream”) [2002] 1 Lloyds Rep 719,
735, the following appears:
The burden of proof
123.
(1) The burden of proof is on the claimants to prove that the vessel was unseaworthy, pursuant to art. III, r. 1, before and at the beginning of the voyage.
(2) The claimants must then also prove that the loss or damage was caused by that unseaworthiness: The Europa, [1908] P. 84 at pp. 97-98.
(5) If the claimants discharge the burden in respect of (1) and (2), the burden passes to the defendants to prove that they and those for whom they are responsible exercised due diligence to make the ship seaworthy in the relevant respects: The Toledo, [1995] 1 Lloyd’s Rep. 40 at p. 50.
(a) If they fail to do so, the defendants are not entitled to rely upon the exceptions in art. IV, r. 2, including the “fire” exception.
(b) If the defendants are able to do so, they can rely upon the “fire” exception as a defence to breach of art. III, r. 2, subject to the claimants proving that the loss or damage was “caused by the actual
fault or privity of the carrier”: The Apostolis, [1996] 1 Lloyd’s Rep.
475 at p. 483, col. 2; Scrutton on Charterparties (20th ed), p. 444.
(4) In relation to due diligence, proof of unseaworthiness fulfils the same function as res ipsa loquitur does in ordinary cases of negligence: The Amstelslot, [1963] 2 Lloyd’s Rep. 223 at p. 235 per Lord Devlin; The Fjord Wind, [2000] 2 Lloyd’s Rep. 191 at p. 205. In practical terms, the reasoning is: ”a ship should not be unseaworthy if proper care is taken” (per Lord Justice Stuart-Smith).
[276] Mr Gray suggested that Prof Tetley’s text on the burden of proof on which the plaintiffs rely is incorrect. He submitted Prof Tetley’s view did not represent English law, nor, by extension, that in New Zealand.
[277] This aspect of the case raises two additional factual issues. [278] The first relates to the ropes found in the void space.
[279] Much was made during the hearing of the photograph showing ropes in the void space. Such a space should be watertight and seldom visited, but several of the plaintiffs’ witnesses inferred that the presence of ropes in the void space implied the crew of Tasman Pioneer were using the space for storage and that might amount to an aspect of unseaworthiness.
[280] There is a much simpler and more likely explanation.
[281] Mr Kawasaki’s photographs were taken on 11 June 2001 when the ship was in dry dock. The ropes in his photographs are plaited hawsers. Mr Kawasaki described the ropes as “mooring” ropes. Captain Kuroki’s witness statement describes how salvors used polypropylene multi-plait ropes for towing and mooring, presumably because of their elasticity. Salvors would have accessed the void space during dewatering and repositioning Tasman Pioneer. The most likely explanation for the ropes being in the void space when Mr Kawasaki photographed them about six weeks after the casualty is therefore that they were ropes belonging to the salvors, left in the void space by oversight.
[282] That matter is not therefore shown to be a matter of unseaworthiness.
[283] The rather more important aspect of possible unseaworthiness is, however, the curiosity which arose in the case as to which ship was the subject of some of the reports on which the plaintiffs relied.
[284] Mr Todd was referred to an email from the defendant’s Auckland Port agents to Tasman Orient on 2 April 2001 on the subject of ““Pioneer Ark” AKL Portcall” saying that the vessel’s forward crane had been giving continuous trouble during loading and the twistlock shoes on the lids were “so corroded that their ability to secure boxes must be seriously questioned”, the ship had insufficient deck twistlocks on board and a further safety issue concerned the “gratings that run fore and aft between the hatches in many places are so corroded that they had collapsed, in other cases they were insecure, and in some places only the frame remains, the grating is missing altogether”. Mr Todd noted Captain Roberts should have been told of those problems but did not refer to them. He said the problems did not relate to cargoworthiness.
[285] Then, on 5 April 2001, Australian charter brokers acting between Tasman Orient and Rimba Shipping sent an email concerning Tasman Pioneer saying the “bow thruster has been out for two round voyages”, there had been a crane breakdown at Osaka and a fire on board at Bluff. Mr Todd still did not accept those complaints indicated the vessel was in poor condition.
[286] He was then referred to an email sent by Tasman Orient to Mr Glynos on
17 April 2001 concerning the Pioneer Ark, complaining of malfunctioning or broken cranes, poor reliability, “MAF noticed many rats on the vessel” so de-ratting was required, the walkways and gratings were “so corroded that one stevedore fell through”, “pad eyes on the tank top preventing loading of cargo” and “container shoes rusted and cannot accommodate container twistlocks”. Those, Mr Todd said, were matters of design or age, not seaworthiness.
[287] He was then referred to the Germanischer Lloyd reports of 6 March 2001 for the Pioneer Ark and asked to comment on the remarks about corrosion, wasting and thinning. Mr Todd relied on omission of reference to the void space as indicating the Classification Society had conducted a satisfactory inspection of that area.
[288] This is what may well be an odd sidelight on this case. The ship the subject of this proceeding was named the Larch when built. She had been re-named Pioneer Ark at some stage during her history, and was to be re-named again, this time as Tasman Pioneer as noted in the time charter dated 23 November 2000. The change probably happened when the vessel reached New Zealand because Technomar’s voyage instruction to Captain Hernandez of 17 February 2001 was headed “or M/V “PIONEER ARK”-TBN Tasman Pioneer – on arrival New Zealand”. The vessel the subject of this proceeding was named Tasman Pioneer by 11 April 2001, the date of the first inspection leading to Captain Roberts’ report and admittedly relating to the vessel the subject of this claim. The evidence also included the Lloyds Register of Ships 2001-2 in which the entry for “Pioneer Ark” (after a number of name changes) showed her as having been built in 1979 as job 896 by the Hayashikane Yard while that for the Tasman Pioneer (again after a number of earlier name changes) showed her as having been built in 1982 at a German yard. Tasman Pioneer is listed as having a bow thruster, Pioneer Ark has none.
[289] It therefore appears that the vessel the subject of this proceeding was that listed as Pioneer Ark in Lloyd’s Register and sailed under that name until probably fairly shortly after 17 February 2001 when she was re-named Tasman Pioneer. It seems likely that the vessel then named Tasman Pioneer was re-named Pioneer Ark because the Germanischer Lloyd certificates of 6 March 2001 note that change. The inference to be taken is accordingly that all documents commenting on the condition of the Pioneer Ark created after mid to late February 2001 relate to the former Tasman Pioneer, by then the Pioneer Ark, and not to the former Pioneer Ark, by the same time re-named Tasman Pioneer and the vessel in contention in this case.
[290] The conclusion to be drawn from all of that is that Tasman Pioneer has not been shown to have been unseaworthy in the manner pleaded, either at the commencement of the voyage or at the casualty. As discussed, a number of reports on which the plaintiffs relied appear almost unquestionably to have been about another ship. That certainly applies to the pleaded corrosion of gantries and walkway and poor condition of the hatch covers, locks and seals.
[291] The balance of the allegations essentially contrast the reports from Captain Roberts and Mr Utsonomiya against that from NKKK. Though the two former inspectors were only required to inspect parts of the vessel, they found nothing which would suggest Tasman Pioneer was unseaworthy at the commencement of the voyage. On the other hand, the NKKK report of an inspection carried out about a fortnight after the grounding is likely to have been affected by the damage suffered in the casualty and the salvor’s repairs and other actions. Despite the earlier comments, translation error seems an implausible explanation for the passage cited from the NKKK report and it would certainly have been more helpful had the report been more pointed.
[292] The plaintiffs bear the burden of proof of unseaworthiness (The “Eurasian Dream”). They called no oral evidence on the topic. Despite the strength of the NKKK’s observations, the Court concludes that the plaintiffs have failed to discharge the burden of proof on this aspect of the unseaworthiness allegations.
[293] Despite all the evidence on the topic, it is also not possible to conclude that the void space was not watertight before the grounding. It certainly flooded, but whether it was downflooding from deck apertures permitting water to ingress the void space through damaged pipes cannot be determined. There is weight in Mr Boyd’s view that the only pipe discussed in the evidence was too small for Mr Colman’s flooding scenario to be correct. The photographs of the void space may, as Mr Todd suggested, only show surface corrosion, possibly following exposure to air after the grounding. Though speculative, racking of the ship in the grounding and water pressure on her internal spaces may have opened an aperture between the FPT and the void space. Downflooding from the bosun’s store and deckhead vents may have followed immersion of the fo’c’sle deck. That aspect of the unseaworthiness claim also fails.
[294] There may have been some corrosion in the pipes into no.3 hold but the relatively minimal flooding into that hold was unlikely to have materially affected the vessel’s trim by comparison with holds nos. 1 and 2 being flooded. It is noteworthy that the transverse bulkhead between holds nos. 2 and 3 held despite significant water pressure. Unseaworthiness in that respect is not proved.
[295] Standing back and looking at the matter overall, the conclusion must be that Tasman Pioneer has not been shown to be unseaworthy either at the commencement of the voyage or at the time of the casualty.
(6) New Zealand Dairy Board Claim
[296] Of the New Zealand Dairy Board’s total claim of USD$498,727.26, USD$187,301.87 is for dairy products stowed in reefers on hatches 3 and 4 which were damaged by heat as a result of being left off power at some stage during the voyage.
[297] The total number of reefers on board Tasman Pioneer when the voyage began exceeded the ship’s capacity to supply power and accordingly it had a generator (genset) on deck to supply the extra power required.
[298] On a number of occasions on the voyage to Yokohama, Captain Hernandez’ daily telexes recorded problems with the genset to the point where, on 25 April, he said it “most likely will affect our reefer cargo”. It was to be repaired at Yokohama but the evidence does not appear to show whether that was done.
[299] The salvors disconnected one genset on 6 May to save diesel, though that was in Tasman Pioneer’s engine room. On the same day cables to reefers on the nos.1 and 3 holds were removed but electricity was connected to seven reefers on no.4 cargo hold at the request of the vessel’s superintendent, not Captain Landelius, and were powered by the ship’s generator. On 9 May one reefer was removed from the no.3 hold, again at the request of the superintendent, but was replaced on board on
11 May at Captain Landelius’ request.
[300] In opening, Mr Rzepecky said the plaintiffs’ cargo surveyors were refused the reefers’ Partlow charts recording the containers’ temperature and therefore the plaintiffs were unaware when the disconnection occurred, or, more particularly, whether it was en route from New Zealand to Japan or following the grounding.
[301] He pointed to evidence from the daily telexes from the ship to Tasman Orient in the earlier part of the voyage, which implied that the shipboard generator malfunctioned. Even so, Tasman Orient had a continuing obligation after the grounding to care for the reefer cargoes which were unaffected by flooding (Rey Banano del Pacifico CA v Transportes Navieros Ecuatorianos (The “Isla Fernandina”) [2000] 2 Lloyds Rep 15).
[302] Mr Rzepecky thus submitted Tasman Orient produced no evidence to support its allegation in its defence that the damage to the reefer containers was inevitable following the grounding. That showed that Tasman Orient failed in its ongoing obligation to keep the Dairy Board’s product properly refrigerated. He submitted Tasman Orient had the onus of establishing that the inevitability of damage was a consequence of the grounding and not of some separate fault by Tasman Orient. No evidence had been adduced to discharge its onus and accordingly the Dairy Board in CP 462/02 was entitled to judgment.
[303] Mr Gray said the Partlow charts had never been requested and the loss was caused by the salvor's removal of the genset. There was no evidence of its failure or removal during the voyage or after the grounding. He pointed to Captain Landelius’ evidence. Salvage and saving as much cargo as possible involved prioritization of resources and the loss or damage arising from the failure to maintain electricity supply to the reefers was closely connected with the casualty and arose in the context of preserving the ship and her cargo.
[304] It is possible the Dairy Board’s produce in the on-deck reefers was damaged before Tasman Pioneer reached Yokohama, but that is speculative. As Captain Kuroki’s witness statement demonstrates, the times at which gensets may have been connected or disconnected to reefers, particularly those containing Dairy Board produce, is unclear, as is whether the disconnections were at the salvor’s instigation or the direction of the Swedish Club representative. In the absence of the Parlow charts for the reefers containing the damaged Dairy Board produce, it would be unsafe to conclude that Tasman Orient failed in its continuing obligation to care for the reefers after the grounding by disconnecting the electricity supply. The position is so uncertain that no such conclusion can be safely reached.
[305] Accordingly, that aspect of the Dairy Board’s claim is not made out.
Result
[306] In the result:
c) There will be a telephone conference with counsel on Tuesday,
30 October 2007 at 9:00am to discuss costs and the future conduct of the case unless counsel advise beforehand that no such conference is required.
......................................
WILLIAMS J.
Solicitors:
McElroys, P O Box 835 Auckland, for plaintiffs
DLA Phillips Fox, P O Box 160 Auckland, for defendant
Copy for:
Philip R Rzepecky, P O Box 105 521 Auckland, for plaintiffs
Bruce D Gray QC, P O Box 4338 Shortland Street, Auckland, for defendant
Stewart Scorgie, Case Officer, Auckland High Court
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