FEDERAL COURT OF AUSTRALIA Mitsubishi Australia Limited v Ship MV Patriot [2007] FCA 1982 MITSUBISHI AUSTRALIA LIMITED v SHIP MV PATRIOT NSD 1696 OF 2003 ALLSOP J 11 DECEMBER 2007 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 1696 OF 2003 BETWEEN: MITSUBISHI AUSTRALIA LIMITED Plaintiff AND: SHIP MV PATRIOT Defendant JUDGE: ALLSOP J DATE OF ORDER: 11 DECEMBER 2007 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The plaintiff file and serve the statement of claim (substantially in the form tendered as exhibit A on the hearing of its notice of motion filed 6 November 2007) by 14 December 2007. 1. The defendant file and serve its defence by 25 January 2008. 1. The plaintiff file and serve any reply by 1 February 2008. 1. The plaintiff file and serve any supplementary list of discovered documents by 28 February 2008. 1. The defendant give full and verified discovery by 25 February 2008. 1. The defendant's verified list of discovery is to be accompanied by affidavits sworn by: 1. an officer of North of England P&I Association Limited; and 2. an officer of the defendant; with personal knowledge of the claim and the documents to be discovered. 1. The parties are granted leave to seek to vary these orders (if so advised) without the need of formally filing a notice of motion, such application to be made to Rares J, in February 2008, upon 5 days' notice in writing to the solicitor for the other party. 1. The plaintiff's notice of motion filed 6 November 2007 is otherwise dismissed. 1. The costs of the notice of motion filed on 6 November 2007 are reserved. 1. The proceedings are adjourned to 9:30 am on Thursday, 6 March 2008 before Rares J for directions. 1. The parties are granted liberty to apply on 5 days' notice. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 1696 OF 2003 BETWEEN: MITSUBISHI AUSTRALIA LIMITED Plaintiff AND: SHIP MV PATRIOT Defendant JUDGE: ALLSOP J DATE: 11 DECEMBER 2007 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This notice of motion arises out of a dispute about liability for a salvage settlement between ship and cargo interests. In September 2003, MV 'Patriot', owned by the defendant, carried a cargo of steel coils from Japan to Australia. After departure from the port of loading, Patriot suffered engine failure requiring the requested intervention of salvors. She was towed to Sebu in the Philippines after agreeing to salvage under a Lloyd's Open Form agreement. The salvage claim was settled for a sum in the order of US$975,000, of which the plaintiff cargo interest's share was over US$300,000. When Patriot arrived in Newcastle to discharge the coils, she was arrested by a Marshal of the Court. 2 The underlying in personam claim was for an indemnity for any salvage claim which the cargo interest was held liable to pay. A letter of undertaking was provided by the defendant's P&I club. The matter has lain dormant for some years since 2003, pending resolution of the salvage claim. Now that the salvage claim has been resolved, the plaintiff cargo interest wishes to recover from the defendant ship interest the liability of the plaintiff for its share of salvage. From shortly after the event in question, London solicitors requested the provision of documentation concerning the engine breakdown. The reason, expressed very sensibly, if I may say so, was that this provision of documents would facilitate settlement between the parties without the need to engage in expensive litigation. 3 These requests were for over a year ignored by those acting for the defendant. Now they are not merely ignored, they are resisted. The ship interest says that the plaintiff should file its statement of claim to which a defence can be filed before documents are provided. 4 The plaintiff has filed a writ which outlines its case. It says that it needs further documents to refine the issue of unseaworthiness and lack of due diligence. The cargo was carried under the Hague-Visby Rules, the two bills of lading in question specifying English law. The plaintiff has been able to prepare a statement of claim, and it was exhibit A before me on the motion, but it wishes to have discovery before filing it to enable it to refine its particulars. In particular, the plaintiff relies upon the practice note for national practitioners governing maritime work in this Court, which makes clear reference to the responsibility of parties to provide documents to each other in a sensible and informal way. The aim of the practice note is to encourage and require sensible commercial conduct of claims by litigants. The Court expects no less in all cases. It would be open to the Court to order the production of the documents now, before the pleading is filed. Ample authority exists outside the national practice note to enable the Court to flexibly approach the resolution of cases. 5 However, on balance, given a careful examination of the correspondence between the parties, I think there will be in the long run less cost and dispute if the more traditional rules of pleading and document production are followed. On balance, given the attitude thus far displayed in the correspondence, in particular by the defendant's representatives, I think that a statement of claim should be filed. If, after the production of the documents, there is a need for amendment, I will take this application into account in ascertaining who pays the costs of those amendments. The events took place in 2003. It is important that the claim now proceed as quickly as possible. It will not be delayed by any form of paper war between the parties about particulars. 6 The issues will be defined promptly by pleadings and then prompt, full, verified discovery will take place. The orders that I propose, the terms of which may be settled by the parties by 5 pm today, are as follows: 1. A statement of claim substantially in the form of exhibit A to be filed by 14 December 2007. 2. A defence filed by 25 January 2008. 3. Any reply by a week thereafter. 4. Full verified discovery is to be given by the defendant on or before a date convenient to the parties at the end of February. 5. The verified discovery of the defendant will be accompanied by affidavits from (a) an officer of the club handling the matter and (b) an officer of the defendant, with personal knowledge of the claim and the documents. 7 I propose to dismiss the motion otherwise, subject to granting leave to the parties to seek to vary the orders without formality of filing of the notice of motion. Such application may be made before Rares J in February 2008, on notice to the other side of five working days. 8 Costs of the motion are reserved. I reserve the costs notwithstanding the dismissal of the motion because it is not appropriate as yet to ascertain whether the documents that are ultimately produced should have been conveniently produced before this motion and the costs of the motion may be affected by the merits of the claim. Therefore I will order that the parties bring in to my associate by 4.30 this afternoon a minute of orders reflecting those matters. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate: Dated: 18 January 2008 Counsel for the Defendant: Mr G Nell SC with Mr E Cox Solicitor for the Defendant: James Tuite & Associates Solicitor for the Defendant: Middletons Date of Hearing: 16 November 2007 Date of Judgment: 11 December 2007