1. This is an application on the part of Messrs. Lloyds Triestino Societa Per Azinni di Navigazione Sede in Triesta, defendant No. 1 herein for stay of a suit.
2. The suit was filed on June 8, 1957 by Messrs. Lakshminarayan Ramniwas, a firm carrying on business at 18, Netaji Subhas Road, Calcutta, against the said Steamship Co., described in the cause title of the plaint as carrying on business through their agents Messrs. Turner Morrison and Company (Private) Ltd., and the Commissioners for the Port of Calcutta. The plaintiff claims to be an endorsee of several bills of lading issued by the defendant No. 1 in March, 1956 for certain consignments of Mild steel round bars to be transported from Genoa (Italy) to Calcutta. The said consignments reached Calcutta in "S.S. Alga" on May 22, 1956 and it is alleged in the plaint that on delivery of the goods being taken through the plaintiff's clearing agents in June, 1956 it was found that 22 bundles of rods were short landed and a certificate to that effect was issued by the Commissioners for the Port of Calcutta. By reason of such short delivery the plaintiff claims compensation to the extent of Rs. 15,154/6 nP.
3. By its written statement filed on August 1, 1957 the defendant No. 1 relies on several clauses in the bills of lading which are in the Italian language with the English rendering thereof side by side. Clauses 3, 7, 21, 25, 31 and 32 referred to are as follows :--
"(3) The declaration as to weight, quantity, volume, contents and value of the goods are considered as given unilaterally by the Shipper and do not constitute any proof against the Captain or any acknowledgment by him, the obligations of the Master and of the Owners being limited to the re-delivery of the goods loaded in the same apparent condition of packing in which they were received, excepting cases of Force Majeure and the other causes provided for in this Bill of Lading."
7. Every package must at time of shipment, be in good condition without any trace of damage or pilferage; cases must be strengthened with iron bands or safety netting properly fixed; bagged cargo must be in double bag. Every package must be indelibly marked to show marks, countermarks, numbers and any other indication as well as Port of destination and port of transhipment, if any, to correspond with declarations made on the bills of lading and/or shipping order so as to avoid confusion and mistakes. For packages weighing more than 1000 kilos the Shippers must indicate on the package its weight and specify same oil the bill of lading. The Company and the Captain are not liable to the Shipper and the Receiver for any consequences deriving from the non-fulfilment of these regulations.
21. The goods shall be discharged on arrival of the vessel by the Port Stevedores for account and at the expense, risk and peril of the shipper or receiver; the unloading shall take place without the obligation of giving notice to the receiver even during the night and holiday. The company may demand that the discharge be effected by firms of stevedores of their choice.
25. Any claim for damage or shortage or other claim inherent to the present bill of lading must be submitted in order to be considered, in writing to the company before taking delivery of the goods and within 7 days from the arrival of the vessel at port of destination.
31. All requests for compensation in respect of damage, shortage, deterioration, loss of goods loaded shall be submitted for friendly settlement to the agencies of the shipping company at the place of discharge. Failing a friendly agreement, both the shipper and the receiver as well as any other party interested in the cargo, if intending to take legal steps against the company, for the abovementioned causes and in general for whatsoever other causes, may summon them before Judicial Authorities of Trieste or Genoa, hereby expressly renouncing the competence of any other Judicial Authorities. No exception must be made to this exclusive competence even if the company is sued party (defendant) by reason of connection or contingency of the law suits.
32. For anything which has not been provided for or foreseen in the present contract of carriage, the provisions of Italian Code of Navigation shall apply."
The defendant denies the validity and the correct ness of the short landing certificates. It does not admit that the Mild steel bars were packed in the number of bundles mentioned in the Bills of Lad ing either on shipment or on discharge or on deli very. The defendant contends that Clause 7 of the bills of lading was not complied with and states that the entire quantity of goods shipped was duly landed at Calcutta. The defendant relies specially on Clauses 31 and 32 of the said bills of lading and on the strength thereof put forward the plea in the written statement that this Court has no jurisdiction to entertain this suit. In paragraph 19 of the written statement it is stated that by Italian Law the Courts at Trieste and at Genoa, or, in the alternative, the Court of Trieste or the Court of Genoa have jurisdiction to entertain and try the issues raised in this suit between the parties. The plaintiff was bound, according to Clause 31 of the Contract of Carriage, to bring this suit in the Court at Trieste or in the Court at Genoa and not in this Court, and in the premises this Court has no jurisdiction to entertain or try this suit.
4. In February, 1958 the plaintiff applied for an order far discovery against the defendants. I understand that the applicant then proclaimed its intention to make an application for stay of the suit and an order for discovery was made by the learned Judge without prejudice to the right of the defendant, if any, to apply in that behalf.
5. This application is based on a notice of motion taken out on May 10, 1958. The petitioner relies on the above clauses in the bills of lading and states in paragraph 6 of the petition that (a) the defendant No. 1 is a company domiciled in Trieste in Italy, (b) the vessel S.S. Alga is an Italian vessel flying the Italian flag, (b) the plaintiff placed orders for the supply of consignments in suit with one Compania Jenoves D'Esportasione, Genoa. Italy, an Italian company, (d) the goods were shipped by the Italian company from Genoa, (e) the Contracts of Carriage made at Genoa are governed by the Italian Law and each one of the said bills of lading was signed and issued there and (f) freight was paid at Genoa. The weight, quantity, volume, contents and value of the goods alleged to have been shipped from Genoa are in issue in this suit. The officers of the vessel, who will depose on behalf of the defendant No. 1 with regard to shipment of the consignment at Genoa and the landing or discharge thereof at Calcutta, reside in Italy and relevant documents of the defendant No. 1 necessary for the purpose of this case are also lying in Italy. It is further stated that the Italian Courts mentioned in the Contracts of Carriage have jurisdiction to entertain and try the suit and the said Courts are also Courts of Convenience and, in the premises, this suit should be stayed pending the institution of legal proceedings or final decision thereof in the tribunals at Trieste or Genoa in Italy.
6. The plaintiff's affidavit-in-opposition was affirmed by one Shrimandar Das Jain on June 2, 1958. Most of the statements of fact made in paragraph 6 of the petition are admitted including the assertion that the Contracts of Carriage are governed by the Italian Law. It is also admitted that the weight, quantity and value of the goods shipped are in issue in this suit. The deponent, however, does not admit that any of the officers of the vessel will have to depose on behalf of the defendant or that they reside in Italy or that the relevant documents are lying in Italy. He does not profess to know what Courts, if any, sit or function at Trieste or Genoa or what jurisdiction they exercise. He does not also admit that any of the Courts in Genoa or Trieste has jurisdiction under the Italian Law to entertain the claim made in this suit. The deponent finally states that the application is a much belated one and ought, to be dismissed on that ground.
7. Mr. Deb, learned counsel appearing in support of the applicant, does not contend that a clause like Clause 31 of the bill of lading is really an arbitration clause but he urges that the effect of such a clause is that it is open to one of the contracting parties to invoke the same in his aid and ask for stay of a suit if it is filed in a Court other than the one on which the parties agree to confer exclusive jurisdiction. He does not go to the length of arguing that this Court will have no jurisdiction to try this suit and he admits that the agreement to that extent is not capable of enforcement. But, he argues, most of the evidence necessary to prove the plaintiff's case will be available at the ports of shipment in Italy and that only the evidence as to the weight of the goods and the number of packages landed at Calcutta will be available here and taking all the facts into consideration, the Court should come to the conclusion that the place where it would be more convenient to have a claim of this nature adjudicated upon would be either Genoa or Trieste in Italy. He relies on the judgment of Bachawat, J. in Motabhai Gulabdas and Co. v. Mahaluxmi Cotton Mills Ltd., 91 Cal LJ 1, where the contract contained a clause that the sale was subject to the rules and regulations of the Liverpool Cotton Association Ltd., Liverpool Arbitration as well as another clause reading "This contract is subject to Bombay jurisdiction". Bachawat, J. referred to a large number of decisions, both Indian and English, and came to the conclusion that a covenant of this nature did not contravene the provisions of Section 28 of the India. Contract Act if the chosen Court had jurisdiction to try the suit under the ordinary law because the restriction was only partial and the plaintiff was not prohibited absolutely from enforcing his rights by the usual legal proceeding in the ordinary tribunal of the land. His Lordship further observed that the Court should, in an appropriate case, enforce such covenants where it was legal relying on the cases of St. Pierre v. South American Stores, 1936-1 KB 382 and Adam Abdul Shakoor v. Ali Mahomed Ebrahim Shakoor .
8. Mr. Deb also relied on a judgment of the Bombay High Court in the case of Marittima Italiana Steamship Co. v. Burjor Framroze Rustomji ILR 54 Bom 278 : (AIR 1930 Bom 185), where the facts were somewhat similar to those in the instant case and Clause 27 of the bill of lading in that case was in the following terms :--
"All applications for indemnity of damage, shortage, deterioration, loss of goods shipped shall be submitted for amicable settlement to the Agency of the Company at the port of discharge. Failing such an amicable understanding, either the shipper or the consignee, desiring to proceed against the Company in Court. of Law, can do so before the Judicial Authority in Genoa, Naples, Cagliari or Venice, in case of a dispute for not more than Liras 500; and only before the Judicial Authority in Genoa for sums over that amount, the shipper and the receiver or any other person interested in the cargo expressly renouncing the competence of any other judicial authority."
Rangnekar, J. refused to grant the stay applied for but on appeal Kemp, A.C.J. and Murphy J. took a different view and held that the learned Judge had not properly exercised his discretion. With regard to Section 28 of the Indian Contract Act their Lordships observed that it was certainly void to the extent that it sought to oust the jurisdiction of the Court which would otherwise be competent to try the suit and this was apparent from the use of the expression "to the extent" at the end of the first paragraph of the section. Their Lordships repelled the contention that the clause referred to in the agreement was wholly void.
9. On behalf of the respondent the following contentions were raised in opposition to the application. First, that under Section 28 of the Contract Act such a clause was void and ought not to be given effect to. Needless to say that this contention cannot be supported in view of what I have said above. The second point urged was that it was not quite clear and there was no sufficient evidence before the Court that there are Courts of competent jurisdiction functioning either at Genoa or at Trieste which can entertain the plaintiff's claim herein against the defendants. It was argued that the averment in the petition that there are competent Courts at Genoa and at Trieste is only verified by an assistant of Turner Morrison and Co. who is neither a lawyer nor a person sufficiently conversant with the Italian legal system to be able to make such an assertion. There certainly is some force behind this contention but what the respondent does in his affidavit-in-opposition is not to deny that there are such Courts but to state that he does not admit that there are such Courts. In the affidavit-in-reply the said assistant Leonard Wilfred Balcombe reiterates what he has stated in the petition. Although it is true that the plaintiff might have filed an affidavit from some one who would be expected to be more conversant with such facts. I cannot disregard the affidavit which is verified as true to the knowledge of the deponent Leonard Wilfred Balcombe. The third point urged by learned counsel for the respondent is that it has not been shown that it would be more convenient to have a suit of this nature tried in Italy because According to learned counsel the bills of lading under Section 3 of the Bills of Lading Act are conclusive evidence of the statements as to weight, description of the goods etc. That clearly would bo so unless there were clauses like Clause 3 and Clause 7 already referred to. If, therefore, the shipping company or the steamer company denies that goods of the weight or the number of packages mentioned in the bills of lading were actually shipped, an issue would arise on these questions of fact. As I have already said, the only evidence available at Calcutta would relate to the number of packages and the weight of the goods landed. How many witnesses the steamship company will examine I do not know but it is apparent that quite a few witnesses who are not at Calcutta but probably available either at Genoa or Trieste will have to be called. I cannot take the view that Calcutta would be the more convenient situs for the decision of the suit.
10. Lastly, it was contended on behalf of the respondents that the application is hopelessly belated and ought to be rejected in view of the following, viz., (a) the suit was filed in June, 1957 and the present application was not moved until May, 1958, (b) that an order for discovery has already been made long after the filing of the written statement and if the suit is stayed now there is no knowing as to whether the plaintiff's claim would be barred by limitation under the Italian Law. What the Italian Law on this point is has not been alleged by any one. Even if the suit is stayed, it does not mean that if the plaintiffs suit be thrown out in the Italian Courts on the ground of limitation he will not be allowed to go on with the suit in Calcutta afterwards. There is some force in the contention that the application ought to have been made much earlier man May, 1958 but I do not think I ought to refuse the application on the ground of this delay, specially in view of the fact that in February, 1958 when discovery was applied for the defendant made its position clear that it was going to apply for a stay.
11. It may be somewhat hard on the plain tiff to have his suit stayed after a year of its institution but a party who entered into a contract of this type providing that the legal proceedings should be confined to the Courts as Trieste or Genoa and renouncing the competence of other judicial authorities cannot normally complain if enforcement of the said agreement is insisted on. If the plaintiff wanted to guard against such contingency he should have informed his shipper in Italy not to take out bills of lading in the form in which they are ex pressed. I will make an order for stay of all further proceedings in this suit until further orders of this Court in terms of prayer (a) of the petition.
Costs reserved. If no proceedings are taken in Italy the defendant will be at liberty to mention the matter and ask for costs.
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