Ixom Operations Pty Ltd v Blue One Shipping SA

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 19 September 2022
• Neutral Citation: [2022] FCA 1101
• Date: 19 September 2022

Federal Court of Australia

Ixom Operations Pty Ltd v Blue One Shipping SA [2022] FCA 1101

File number(s):	NSD 1266 of 2020
Judgment of:	BURLEY J
Date of judgment:	19 September 2022
Catchwords:	ADMIRALTY – demise charter – where owner not a party to contract of carriage evidenced by bill of lading – where extensions to limitation period on bringing a claim over contaminated cargo given to the consignee of the cargo by lawyers acting for both owner and demise charterer of vessel – where consignee only brought proceedings initially against owner – where demise charterer sought to rely on limitation period – meaning of ‘owner’ – extension found to be granted on behalf of demise charterer ; CONSUMER LAW – whether conduct of owner and demise charterer regarding extensions to the limitation period amounted to a contravention of section 18 of the Australian Consumer Law – whether contributory negligence reduced any damages to which the consignee may be entitled ; ESTOPPEL – whether owner of vessel estopped from denying it was a party to the contract of carriage evidenced by the bill of lading – whether demise charterer estopped from relying on limitation period
Legislation:	Carriage of Goods by Sea Act 1991 (Cth) s 8, Sch 1A, Amended Hague Visby Rules Arts 1, 3 Competition and Consumer Act 2010 (Cth) ss 87CB, 137B, Sch 2, Australian Consumer Law s 18 Sea-Carriage Documents Act 1997 (NSW) ss 5, 8
Cases cited:	Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; 77 NSWLR 299 Butcher v Lachlan Elder Reality Pty Ltd [2004] HCA 60; 218 CLR 592 Commonwealth v Verwayen [1990] HCA 39; 170 CLR 394 Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd [1986] HCA 14; 160 CLR 226 Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd [2010] HCA 31; 241 CLR 357 Miller Heiman Pty Ltd v Sales Principles Pty Ltd [2017] NSWCA 106; 94 NSWLR 500 Pacol Ltd v Trade Line Ltd (The “Henrik Sif”) [1982] 1 Lloyds Rep 456 Sidhu v van Dyke [2014] HCA 19; 251 CLR 505 Taylors Fashions Ltd v Liverpool Victoria Trustees Co Ltd [1982] 1 QB 133 The “Stolt Loyalty” [1993] 2 Lloyds Rep 281 The “Stolt Loyalty” [1995] 1 Lloyds Rep 598 (CA) The August Leonhardt [1985] 1 Lloyds Rep 28 Tritton Resources Pty Ltd v Ever Rock Navigation S.A. [2019] FCA 276; 369 ALR 205 Waltons Stores (Interstate) Ltd v Maher [1988] HCA 7; 164 CLR 387
Division:	General Division
Registry:	New South Wales
National Practice Area:	Admiralty and Maritime
Number of paragraphs:	175
Date of last submission:	10 May 2022
Date of hearing:	4-6, 12 April 2022
Counsel for the Plaintiff:	Mr E G H Cox
Solicitor for the Plaintiff:	Mills Oakley
Counsel for the First and Third Defendants:	Mr G Nell SC
Solicitor for the First and Third Defendants:	Thynne + Macartney

ORDERS

		NSD 1266 of 2020
BETWEEN:	IXOM OPERATIONS PTY LTD Plaintiff
AND:	BLUE ONE SHIPPING SA First Defendant ; LS-NIKKO COPPER INC Second Defendant ; CS MARINE CO LTD Third Defendant

order made by:	BURLEY J
DATE OF ORDER:	19 September 2022

THE COURT ORDERS THAT:

1. The application be dismissed.

2. The plaintiff pay the costs of the first and third defendants.

3. Any party may apply to the chambers of Burley J within 14 days if they wish to contend for a costs order different to that set out in (2).

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1 INTRODUCTION	[1]
1.1 The proceedings	[2]
1.2 The pleaded case	[5]
1.3 The separate questions	[12]
2 THE ORAL EVIDENCE IN CHIEF	[16]
2.1 The evidence on behalf of IXOM	[17]
2.2 The evidence on behalf of Blue One Shipping and CS Marine	[31]
3 THE ESTOPPEL AND ACL CLAIMS	[41]
4 RELEVANT FACTUAL BACKGROUND	[49]
5 THE SUBMISSIONS	[109]
5.1 IXOM	[109]
5.2 The defendants	[121]
6 CONSIDERATION	[124]
7 CONCLUSION AND DISPOSITION	[174]

BURLEY J:

1. INTRODUCTION

1. IXOM Operations Pty Ltd advances claims in these proceedings that it was delivered a cargo of contaminated sulphuric acid in breach of obligations owed to it by the carrier of the cargo aboard the MV “CS Onsan”. The separate questions for current determination primarily concern whether Blue One Shipping, which was the registered owner of the CS Onsan, and CS Marine Co Ltd, which was the demise charterer of the vessel, are estopped from advancing defences to the effect that the claims are time barred by the operation of Article 3 rule 6 of the Australian Amended Hague Visby Rules in Schedule 1A to the Carriage of Goods by Sea Act 1991 (Cth). The dispute largely centres upon communications that passed between the solicitors acting for the parties and their insurers.

1. The proceedings

2. IXOM was the purchaser and consignee of a cargo of approximately 25,300 metric tonnes of sulphuric acid being shipped in bulk from Korea to Australia. The vendor and consignor was Trammo Pty Ltd. Pursuant to the terms of sale, Trammo arranged for the carriage of the consignment pursuant to the charter of the CS Onsan under a Tanker Voyage Charter Party. IXOM was not a party to the Charter Party but was named as the consignee on a non-negotiable tanker Bill of Lading dated 22 May 2017. Upon arrival on 6 June 2017 at Gladstone, Queensland, discolouration of the cargo was observed.

3. A dispute arose as to whether IXOM would take delivery of the consignment. After some negotiations in June 2017, the parties agreed to vary the arrangements for the discharge of the cargo, and IXOM reserved its rights to pursue a claim. On the approach of the first anniversary of the discharge, IXOM sought an extension of the limitation period under the Hague Visby Rules. The terms of the grant of that extension, given on 25 May 2018, give rise to the present dispute.

4. On 25 November 2020, IXOM commenced proceedings against the first defendant, Blue One Shipping. Somewhat later, in circumstances that are set out below, IXOM joined the third defendant, CS Marine. The second defendant, LS Nikko Copper Inc, was never served with the proceedings and it is not necessary to refer to it further. In these reasons, references to “the defendants” mean Blue One Shipping and CS Marine.

1. The pleaded case

5. It is convenient to summarise the course of the pleadings by reference to the following steps.

6. First, in its Originating Application IXOM claimed damages in the amount of $1,751,709, interest and costs, alleging that Blue One Shipping, by delivering contaminated cargo, failed in its duty to deliver the consignment in good order and condition in breach of (the primary claims):

1. its duty as a carrier and/or bailee for reward under the contract of carriage;

2. an implied term of the contract of carriage;

3. its duties under the Hague Visby Rules;

4. its...