Practice and Procedure

(1) A/S D/S SVENDBORG (2) D/S AF 1912 A/S (Bodies Corporate trading in partnership as MAERSK SEALAND) v (1) ALI HUSSEIN AKAR (2) LAMTEX (3) RAJA BEYDOUN (4) ETABLISSEMENTS RAJA BEYDOUN (5) HUSSEIN ALI AKAR (2003)

PUBLISHED April 28, 2003

The claimants were awarded damages consisting of costs and expenses incurred by them in investigating and defending claims brought by the defendant and for breach of the contract of carriage.Action by claimants ('MS') for damages incurred by them in investigating and defending claims brought by the defendants including an indemnity in respect of future costs and expenses. MS shipped two containers of textiles from China and India to Guinea on behalf of the defendants. The defendants commenced two sets of proceedings in Guinea and Hong Kong, in respect of damages for: (i) alleged non-delivery of the goods; and (ii) alleged delay in the delivery of goods. In each case the damages were far in excess of the true value of the goods. MS contended that: (i) the claims were fraudulent and inflated; and (ii) the proceedings commenced by the defendants were in breach of the terms of the contract of carriage, specifically clause 27, which was an English law jurisdiction clause.HELD: (1) On the evidence the defendants had abstracted the goods and had made a fraudulent non-delivery claim. Therefore, MS was entitled to a declaration that the claim by the defendants for alleged non-delivery of the goods was false and fraudulent. (2) Clause 27 was an exclusive jurisdiction clause. The defendants had breached the clause. In consequence of the breach MS had suffered loss and damage, which they had incurred in investigating and defending the proceedings in Guinea and Hong Kong. (3) In accordance with Union Discount v Zoller (2002) 1 WLR 1517 MS was entitled to recover its reasonable expenses of litigating at the instigation of the defendants in the jurisdiction which the defendant had chosen in breach of an exclusive jurisdiction clause. (4) MS were entitled to damages for deceit and/or breach of contract in the sum of US$130,941.48 together with interest of US$7,414.73. MS were entitled to an indemnity from the defendants in respect of future costs and expenses incurred as a consequence of the proceedings commenced by the defendants. The defendants were liable to pay MS's costs in the sum of ?140,000.Judgment accordingly.

[2003] EWHC 797 (Comm)