Date: 19980216
Docket: T-459-95
BETWEEN:
CANUSA SYSTEMS LTD,
and
CANUSA EMI
and
SHAW INDUSTRIES LTD.,
Plaintiffs,
- and -
THE VESSEL "CANMAR AMBASSADOR"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CANMAR AMBASSADOR"
and
CANADA MARITIME LTD.
and
CENTENNIAL SHIPPING LTD.
and
LEMAN USA INC.
and
LEMAN LIMITED
and
TOWNE AIR FREIGHT INC.
and
SOO LINE RAILWAY
Defendants.
REASONS FOR JUDGMENT
DUBÉ J:
[1] The plaintiffs, owners of a shipment of heat shrunk tubing, seek a summary judgment against the defendants Leman USA Inc. and Leman Limited freight forwarders of those goods for damage by wetting while carried in ocean container from Bradford, England, to Chicago, Illinois, USA, with discharge occurring in Montréal, Canada.
[2] In their defence, these defendants ("Leman") admit that as a freight forwarders they arranged for the shipment of the cargo under clean Canada Maritime Bill of Ladings, that there was damage to the cargo noted upon arrival in Chicago, and that said damage occurred during the ocean carriage. They also claim they performed their contractual duties promptly and correctly, that as freight forwarders they arranged for the ocean carriage of the shipment but were not responsible for such ocean carriage.
[3] Clause 2.1 of the Bill of Lading provides that "By the issuance of this "Combined Transport Bill of Lading", the Freight Forwarder . . . (b) assumes liability as set out in these Conditions". Further down, clause 6(A)(1) of the Bill of Lading reads as follows:
| "The Freight Forwarder shall be liable for loss of or damage to the goods occurring between the time when he takes the goods into his charge and the time of delivery". |
[4] Clause 6(A)(2) of the Bill of Lading provides that "The Freight Forwarder shall, however, be relieved of liability for any loss or damage" and lists causes of relief. Clause 6(A)(3) stipulates that "The burden of proving that the loss or damage was due to one or more of the above causes or events shall rest upon the Freight Forwarder".
[5] Thus, the plaintiffs argue that since Leman has not invoked in its defence any of the causes for which they would have been relieved from liability, it follows that they are liable for all cargo damage pursuant to clause 6(A)(1) of the Bill of Lading.
[6] Furthermore, clauses 6(B) and 7 of the Bill of Lading read as follows:
| 6. B. When in accordance with Clause 6(A)(1) the Freight Forwarder is liable to pay compensation in respect of loss or damage to the goods and the stage of transport where the loss or damage occurred is known, the liability of the Freight Forwarder in respect of such loss or damage shall be determined by the provisions contained in any international Convention or national law, which provisions |
| (i) cannot be departed from by private contract, to the detriment of the Claimant, and |
| (ii) would have applied if the Claimant had made a separate and direct contract with the Freight Forwarder in respect of the particular stage of transport where the loss or damage occurred and received as evidence thereof any particular document which must be issued in order to make such international convention or national law applicable. |
| 7. Paramount Clause |
| The Hague Rules contained in the International Convention for the unification of certain rules relating to Bills of Lading, dated Brussels 25th August 1924, or in those countries where they are already in force the Hague-Visby Rules contained in the Protocol of Brussels, dated February 23rd 1968, as enacted in the Country of Shipment, shall apply to all carriage of goods by sea and, where no mandatory international or national law applies, to the carriage of goods by inland waterways also, and such provisions shall apply to all goods whether carried on deck or under deck. |
[7] Since the United Kingdom is the country of shipment, the plaintiffs invoke the Carriage of Goods by Sea Act1 from which it follows that the Hague-Visby Rules govern the liability of Leman. The relevant articles of the Hague-Visby Rules provide as follows:
| Article IV(5)(a): "...neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the goods in an amount exceeding 666.67 units of account per package or unit or 2 units of account per kilogramme of gross weight of the goods lost or damaged, whichever is the higher;" |
| . . . |
| Article IV(5)(d): "The unit of account mentioned in this Article is the special drawing right as defined by the International Monetary Fund. The amounts mentioned in subparagraph (a) of this Article shall be converted into national currency on the basis of the value of that currency on a date to be determined by the law of the Court seized of the case;" |
[8] Furthermore, clause 8.3 of the Bill of Lading provides that "Compensation shall not, however, exceed 2 SDR (Special Drawing Rights) per kilo of gross weight of the goods lost or damaged...".
[9] As a consequence, the plaintiffs submit that Leman are carriers of this shipment and that their defence does not present a genuine issue for trial other than the amount to which the plaintiffs are entitled, the quantum of which can be dealt by way of reference.
[10] On January 8, 1998, Leman filed a statement of claim against two of the co-defendants, Canada Maritime Ltd. and Centennial Shipping Ltd.
[11] However, Leman argues that due to the inactivity of the plaintiffs in this file, it was their intention to file a motion for dismissal for want of prosecution, which probably caused the plaintiffs to file the instant motion for summary judgment. Leman submits that this is not a case suitable for summary judgment since it has a serious defence having pleaded the absence of any contract between them and the plaintiffs and the fact they were not the actual carrier of the goods. Although Leman admits that the cargo in question sustained damage, the nature, extent, origin and cause of said damage is not known. In the absence of the plaintiffs, Leman could not defend itself. Leman relies on jurisprudence to the effect that the carrier is prima facie liable for loss to cargo received in good order and out-turned short or in bad order2. A second principle of proof is to the effect that the parties are in general required to make proof of whatever facts are available to them.
[12] In Granville Shipping Co. v. Pegasus Lines Ltd. (T.D.)3, Tremblay-Lamer J. summarized the general principles pertaining to summary judgment, as follows:
| 1. the purpose of the provisions is to allow the Court to summarily dispense with cases which ought not proceed to trial because there is no genuine issue to be tried (Old Fish Market Restaurants Ltd. v. 1000357 Ontario Inc. et al.);4 |
| 2. there is no determinative test (Feoso Oil Ltd. v. Sarla (The))5 but Stone J.A. seems to have adopted the reasons of Henry J. in Pizza Pizza Ltd. v. Gillespie.6 It is not whether a party cannot possibly succeed at trial, it is whether the case is so doubtful that it does not deserve consideration by the trier of fact at a future trial; |
| 3. each case should be interpreted in reference to its own contextual framework (Blyth7 and Feoso);8 |
| 4. provincial practice rules (especially Rule 20 of the Ontario Rules of Civil Procedure, [R.R.O. 1990, Reg. 194]) can aid in interpretation (Feoso9 and Collie);10 |
| 5. this Court may determine questions of fact and law on the motion for summary judgment if this can be done on the material before the Court (this is broader than Rule 20 of the Ontario Rules of Civil Procedure)(Patrick);11 |
| 6. on the whole of the evidence, summary judgment cannot be granted if the necessary facts cannot be found or if it would be unjust to do so (Pallmann12 and Sears);13 |
| 7. in the case of a serious issue with respect to credibility, the case should go to trial because the parties should be cross-examined before the trial judge (Forde14 and Sears).15 The mere existence of apparent conflict in the evidence does not preclude summary judgment; the court should take a "hard look" at the merits and decide if there are issues of credibility to be resolved (Stokes).16 |
[13] Counsel for Leman relies on the sixth principle to invite the Court to decline summary judgment because the necessary facts cannot be found and it would be unjust to do so.
[14] I cannot accept that proposition. Facts already admitted by Leman in its defence coupled with the Bill of Lading are sufficient to grant summary judgment against the freight forwarders. Counsel for Leman also submits that in the absence of the plaintiffs they would be unable to establish the loss or the damage. That is not so. If necessary, the plaintiffs may be subpoenaed, ordered to testify and to bring all relevant documents.
[15] In conclusion, summary judgment ought to be awarded in favour of the owners as against the freight forwarders as there is no genuine issue to be tried between them. The ultimate responsibility will be determined at trial between the defendants. The quantum of damages will be assessed by way of reference.
Judge
OTTAWA, Ontario
February 16, 1998
__________________1 Ch. 19, Statutes of the United Kingdom of Great Britain and Northern Ireland.
2 Marine Cargo Claims, 3rd ed., William Tetley, at pp. 133 and 137.
3 [1996] 2 F.C. 853 at p. 859.
4 (1994), 58 C.P.R. (3d) 221 (F.C.T.D.).
5 [1995] 3 F.C. 68 (C.A.).
6 (1990), 75 O.R. (2d) 225 (Gen. Div.).
7 Marine Atlantic Inc. v. Blyth (1994), 77 F.T.R. 97 (F.C.T.D.) (hereinafter Blyth).
8 supra, note 5.
9 supra, note 5.
10 Collie Woollen Mills Ltd. v. Canada, [1996] F.C.J. No. 193 (T.D.) (QL) (hereinafter Collie).
11 Patrick v. Canada, [1994] F.C.J. No. 1216 (T.D.) (QL) (hereinafter Patrick).
12 Pallmann Maschinenfabrik G.m.b.H. Co. KG v. CAE Machinery Ltd. (1995), 62 C.P.R. (3d) 26 (F.C.T.D.) (hereinafter Pallmann).
13 Homelife Realty Services Inc. v. Sears Canada Inc., [1996] F.C.J. No. 51 (T.D.) (QL) (hereinafter Sears).
14 Forde v. Canada (Minister of National Revenue, Customs and Excise--M.N.R.), [1995] F.C.J. No. 48 (T.D.) (QL) (hereinafter Forde).
15 supra, note 13.
16 Shelburne Marine Ltd. v. Stokes, [1995] F.C.J. No. 1547 (T.D.) (QL) (hereinafter Stokes).