New Zealand China Clays Ltd v Tasman Orient Line CV
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
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
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
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
A The plaintiffs are entitled to judgment against the defendant for breach of contract and breach of bailment.
B Although the quantum of the claim is agreed, the impact of that finding on the limitation fund may require a further hearing.
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.
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 and management of the ship be bona fide for those purposes? [227]
(4) Vicarious Liability [243]
(5) Unseaworthiness [250]
(6) New Zealand Dairy Board claim [296]
Result [306]
ANNEXURES [ed: not reproduced]
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:
2. Neither the carrier nor the ship shall be responsible for loss or damage arising or resulting from –
(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 34,083.55m 3 .
[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 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”.
1Annexure 1 is a map of the relevant part of Japan and most of the towns mentioned in this judgment.
[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.
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.
[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 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.
3 Annexure 3 is part of a Japanese chart showing Tasman Pioneer’s actual anchorage.
[41] A number of comments require to be made concerning Captain Hernandez’s brief description of what occurred between the grounding and anchoring.
[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:
HOLD BILGE NO.2 HAD MUCH WATER AND FOUND AT 0430H W/ ABT. 3 METERS WATER I HOLDS.
BALLAST NO.2 PORT HAD BEEN FOUND TO HAVE MORE WATER AND SUDDENLY BECOME FULL.
STILL CHECKING ALL TANKS AND WILL REVERT.
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 Moji4 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 Imabari5 in the Inland Sea. Nippon Salvage is a large operation on watch 24 hours per day 365 days per year at Moji.
4 Moji is on Kyushu in the Kanmon Strait.
5 or Imbari.
[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 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 Beppu6 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.
6 Beppu is on the coast of Kyushu, about 5 miles west of Oita.
[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 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 northwesterly 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:
a) Starboard bow of Tasman Pioneer at approximately 0920 hrs; (Annexure 4)
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, p 5) 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) 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 (3 rd 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 Millard7 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 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.
7 “Millerd” in (1928) 32 Lloyds Rep 91.
[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 2 nd 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 2 nd 199, 215, para [12], (1984) citing United Geophysical Co. v Vela 231 F 2 nd 816, 819, (1956) with Westinghouse being followed in Hale Container Line Inc v Houston Sea Packing Co. Inc 137 F 3 rd 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 3 rd 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 3 rd 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 na