Date: 20010409
Docket: T-38-99
Citation: 2001 FCT 307
BETWEEN:
Enter Style of Cause just after [Comment] code
- THE ROYAL BANK OF SCOTLAND plc.
Plaintiff
- and -
THE OWNERS AND ALL OTHERS INTERESTED
IN THE SHIP "KIMISIS III" AND MADONNA
NAVIGATION (MALTA) LIMITED
Defendants
REASONS FOR ORDER
SIMPSON J.
[1] Prothonotary Hargrave is case managing a matter involving the sale of four ships and the distribution of the proceeds therefrom. In that context, he issued a decision dated June 5, 2000 (the "Decision"), in which he refused Proios Maritime S.A. ("Proios") leave to file a supplementary affidavit of claim for necessaries supplied to the vessel the "Kimisis III". Proios now asks the Court to reverse the Decision.
[2] The Royal Bank of Scotland plc (the "Bank") is the mortgagee of the "Kimisis III", and Tramp Oil and Marine Limited is another claimant in the proceedings. Both these parties ask the court to uphold the Decision.
[3] An initial Affidavit of Claim on behalf of Proios was sworn by Yvonne Declercq on March 25, 1999 (the "Initial Claim"). It stated that Proios had supplied necessaries to the "Kimisis III" in ports in the United States, South Africa, China and Belgium. Invoices for the goods were listed by number and date, and in the case of some invoices, documents appended as exhibits to the affidavit showed the port in which the goods had been supplied. However, for Invoice 7969 of December 5, 1997, in the amount of 608,210 Belgium francs (or approximately $18,000 CAN), there was no such documentation.
[4] Accordingly, in its List of Documents for Production by Proios dated June 17, 1997 (the "Bank's Document Request"), the Bank asked under item 4(a) for "Documents showing acknowledgement of receipt or confirming delivery of invoiced items to M.V. KIMISIS III." These documents were to be produced by November 8, 1999. In order to prepare the required response, counsel for Proios wrote to the company on July 12, 1999, and asked it to search its files for the documents described in the Bank's Document Request. In particular, counsel asked for all air waybills. The affidavit of Robert Margolis sworn on May 31, 2000, shows that on the next day, July 13, 1999, Proios replied saying:
that it did not have any of the documents requested by the solicitors for the Royal Bank of Scotland plc and in addition noted that it had sent me all the documents in its files a few months earlier, including, specifically, all the air waybills.
[5] On May 29, 2000, counsel for Proios again asked his client to look for documents and, in particular, for an air waybill for the goods described in Invoice 7969. The next day Proios faxed to its counsel the air waybill that confirms that the goods referred to in Invoice 7969 were delivered in New Orleans, U.S.A. (the "Air Waybill").
[6] Exhibit "A" to the affidavit of Robert Margolis is the proposed Supplementary Affidavit of Claim to be sworn by Leo Van Gelder, who is the Proios account manager. Therein, he describes the discovery of the Air Waybill, in May of 2000, and indicates that:
In July, 1999 Proios Maritime searched its files for additional documents requested by the mortgagee of Kimisis III. The search did not locate this air waybill. In late May 2000 Proios Maritime's Vancouver lawyers asked it to search its files again for proof that the cylinder liner was delivered to the vessel in New Orleans and this time the air waybill was located.
[7] It is this Air Waybill that Proios seeks to file in its Supplementary Affidavit of Claim. It is a significant document because it shows that Proios delivered the item described in Invoice 7969 in the United States. This fact gives Proios a maritime lien and priority over the Bank for the amount of Invoice 7969. If the Supplementary Affidavit of Claim is not allowed, Proios will not be able to claim ahead of the Bank in respect of that invoice and counsel have acknowledged that, without priority, Proios is not likely to collect the amount it is owed.
The Issues
[8] The relevant cases were discussed by Prothonotary Hargrave in his Decision and they disclose that, normally, leave is not granted to advance new claims which are out of time unless the delay is satisfactorily explained. As well, in deciding whether to grant leave, possible prejudice to other claimants and the just resolution of claims are important factors.
[9] Proios has said that the Supplementary Affidavit of Claim does not assert a new claim. Rather, by exhibiting the Air Waybill, it merely provides supporting documentation for Invoice 7969 which was included in the Initial Claim. However, I have not found this to be a persuasive submission. In my view, the proposed Supplementary Affidavit of Claim dramatically alters the essential characteristics of the Initial Claim as it relates to Invoice 7969. By proving that the goods were delivered in the United States, the Air Waybill gives Proios a maritime lien for the claim which allows it to rank ahead of the Bank. Further, in view of the absence of any extenuating circumstances surrounding the late discovery of the Air Waybill, I can see no basis for the exercise of positive discretion in favour of what is, in substance, a new type of claim.
[10] Accordingly, the motion will be dismissed.
(Sgd.) "Sandra J. Simpson"
Judge
Vancouver, B.C.
April 9, 2001
NAMES OF COUNSEL AND SOLICITORS OF RECORD
STYLE OF CAUSE: THE ROYAL BANK OF SCOTLAND plc
Plaintiff
- and -
THE SHIP "KIMISIS III" et al.
Defendants
DOCKET NO.: T-38-99
PLACE OF HEARING: Vancouver, B.C.
DATE OF HEARING: April 2, 2001
REASONS FOR ORDER: SIMPSON J.
DATED: April 9, 2001
APPEARANCES:
Pauline Gardikiotis for Plaintiff
Ellen Underhill for Defendant
(Proios Maritime S.A.)
Glenn Morgan for Defendant
(Tramp Oil & Marine)
SOLICITORS OF RECORD:
Campney & Murphy for Plaintiff
Vancouver, B.C.
Giaschi & Margolis for Defendant
Vancouver, B.C. (Proios Maritime S.A.)
Davis & Company for Defendant
Vancouver, B.C. (Tramp Oil & Marine)