JUDGMENT Debabrata Mmookerjee, J.
1. This is a defendant's appeal from an order refusing stay of a suit pending institution of another in a foreign court and the obtaining of a decision in that Court.
2. The appellant, a firm incorporated in Sweden, carrying on business under the name and style of Swedish East Asia Co. Ltd., entered into a contract of affreightment with a Swedish citizen of the name of A. B. Cottram, whereby it undertook to carry 1034 bundles of M. S. Fiats shipped by A. B. Cottram on the defendant's vessel S. S. "Kyoto", then at the Swedish port of Gothenburgh. The cargo was to be carried to Calcutta and delivered to the order of the shipper subject to certain terms and conditions imposed in a bill of lading dated April 28, 1956, issued by the petitioner Company to Cottram, the shipper. The vessel reached the port of Calcutta on July 4, 1956 and the plaintiff Company obtained delivery of the consignment less 14 bundles which were said not to have been carried or delivered. There was some correspondence between the parties and a demand for payment of sum of Rs. 12,849/13/- having eventually been refused on account of the short-landed goods, a suit was instituted by the plaintiff Company on the Original Side of this Court, being Commercial Cause No. 1273 of 1957, on the 19th July 1957. The suit was brought with leave under Clause 12 of the Letters Patent and a decree for the sum stated was asked for. In the alternative, a prayer was made for enquiry as to the sum exactly due and a decree for such sum as may be found ultimately due.
3. The main averments in the plaint are that the plaintiff Company became the owner of the entire consignment being the endorsee or the holder for value of the bill of lading. The endorsement took place in Calcutta and despite efforts made to obtain delivery of the entire consignment, the plaintiff Company failed to do so. IE is alleged that the defendant Company, in broach of its duty as common carriers, failed to carry the 14 bundles of M. S. Flats covered by the bill of lading safely and securely and neglected to deliver the said bundles and converted them to its own use. It is said that the defendant carries on business in Calcutta within the Court's jurisdiction through its Agent united Liner Agencies of India (Private) Ltd. at Brabourne Road, and that the failure to deliver the 14 bundles involved a breach of the contract contained in the bill of lading and as such a part of the cause of action having arisen within jurisdiction, leave was asked for and obtained to institute the present proceedings.
4. The Writ of Summons was served on the defendant Company on the 12th August 1957 and the written defence was filed on the 18th November of that year. The defendant Company denied liability and stated that the United Liner Agencies of India (Private) Ltd. were merely its shipping agents and, therefore, agents for a limited purpose. The case the defendant made was that it did not carry on business in Calcutta. It was asserted that the entire quantity of cargo had been duly discharged at the Calcutta port and the obligations under the contract had been fulfilled. There was a firm denial of any breach of contract or duty or of negligence and it was said that the bundles having been insufficiently packed, several of them had become loose. The suggestion was that the cargo had not been properly packed and shipped and, in any event, the defendant Company was not liable to pay the amount for which the suit had been brought by the plaintiff. It was further stated that the bill of lading which constituted the contract, having provided that any dispute arising on the said bill of lading would be decided in Sweden according to Swedish taw, the plaintiff Company was not entitled to pursue its claim, if any, in this Court and, in any event, the suit thus brought in breach of the agreement ought to be stayed.
5. A notice of motion was taken out on the 19th March 1959 for moving an application for stay of the suit and a prayer was made that the action in this Court should be stayed pending the institution of appropriate legal proceedings and final disposal thereof by the Swedish Court in terms of the contract contained in the bill of lading. Reliance was placed upon the clause in that document which stated that if any dispute arose under this bill of lading, it was to be decided in Sweden according to Swedish law. The defendant Company averred that there was a dispute as regards the contents and weight of the cargo and that the material questions at issue between the parties could not conveniently be decided in this Court and could only be dealt with before the appropriate tribunal in Sweden. The defendant Company itself was incorporated in Sweden having its registered office in that country; it had no establishment within the jurisdiction of this Court: the bill of lading was in terms to be governed by the Swedish law the cargo was shipped from a Swedish port; the weight of the cargo and the manner in which it had been carried during the voyage as well as the unloading thereof were matters seriously in dispute between the parties; the vessel which carried the cargo did not frequently visit the Calcutta Port but the evidence of the officers and men who were all Swedish citizen would be most material to a proper and just decision of the dispute raised, there were documents requiring to be proved, namely, Stowage Plan, Log Book etc. which were in Swedish language and it would mean the greatest hardship to the defendant Company if it were to submit to the trial of the action in this Court. The prayer was accordingly made that in the interests of justice as well as on grounds of convenience the suit should be stayed pending institution and disposal of appropriate proceedings before the Swedish court.
6. The plaintiff respondent contested the application on several grounds many of which related to the convenience of parties and witnesses. It was said that the defendant Company had its agents in the United liner Agencies of India (Private) Limited who could look after the suit; that most of the material witnesses were men who lived in Calcutta and material documents were available only in Calcutta. It was said that the evidence of representatives of the Port authorities and of the Customs would be most material in view of the defence taken, namely that the entire cargo had been landed in Calcutta. The bill of lading having been endorsed in Calcutta in favour of the plaintiff Company, proof of such endorsement could only come from men who lived in Calcutta. The officers and men of the defendant's vessel "Kyoto" were, it is said, easily available inasmuch as the ship frequently visited the Calcutta port. It was suggested that if the plaintiff Company was obliged to seek redress in Sweden, it would be confronted with the difficulties arising out of restrictions on the grant of foreign exchange and, in any event, if a fresh suit was to be brought in Sweden such suit would be held barred by limitation under the Rules and Conventions adopted by the International Conference on Maritime Law, commonly known as the Hague Rules. Lastly, it was suggested that the "proper law" of the contract, as understood in Private international Law, would, in this case, be the Indian Law and the proper forum would be the Indian forum.
7. The learned Judge heard the parties and made an order on April 29, 1959, refusing the defendant's application for stay. It is this order which is now under appeal.
8. On behalf of the appellant, it was feebly suggested that this Court had no jurisdiction to deal with the dispute. The suggestion was not, however pursued and we have no hesitation to say that we cannot possibly accede to it. The contract contained in the bill of lading is to be viewed in two parts. It was made in Sweden but it was alleged to have been broken in Calcutta. So, part of the cause of action took place within jurisdiction; consequently this Court has jurisdiction to try the action. This jurisdiction, it derives from the Letters Patent and other laws of the land. No one can be heard to say that the parties to an action having entered into a contract, can by such agreement rob the court of jurisdiction, just as by a private agreement no jurisdiction can be conferred upon a Court which it does not otherwise possess. It must, therefore, be held that this Court has jurisdiction to entertain and decide the dispute. The real question is whether it should do so in the circumstances of this case or accede to the appellant's prayer that the parties must be left in terms of the contract contained in the bill of lading to seek their remedies in the Swedish court. In deciding this question, we have also to take into account the convenience of parties and witnesses and come to a decision as to whether the learned Judge was right in refusing the stay asked for.
9. On behalf of the respondents, we have been reminded of our duty not to disturb the finding of the learned trial Judge merely because we, left to ourselves, might have arrived at a different decision. Reliance has been placed upon the decision , Printers (Mysore) Private Ltd. v. Pothan Joseph. That was a case of stay of proceedings under Section 34 of the Arbitration Act. It was ruled that it was not ordinarily open to the appellate court to substitute its own discretion for that of the trial Judge, but if it appeared that in exercising its discretion, the trial court had acted unreasonably or capriciously or had ignored relevant facts and adopted an unjudicial approach, then it would certainly be open to the appellate court to interfere Kith the trial court's discretion. We have, indeed, to bear in mind the principle here enunciated before we think It right to interfere with the order of the learned trial Judge.
10. It is to be observed that the conclusion of the learned Judge reached on a review of the circumstances does not indicate that he paid due attention to the all important fact emerging from the contract contained in the bill of lading that all disputes between the parties were to be decided in Sweden in accordance with Swedish law. A mere reference to that circumstances in the course of the recital of facts in the earlier part of the judgment is not, we think, sufficient. There is nothing to indicate in the learned Judge's order that proper attention was paid to this aspect of the matter. Indeed, in a similar circumstance, the discretion of the trial court was interfered with by the Court of Appeal in England in the case of New Chinese Antimony Co. Ltd v. Ocean Steamship Co. Ltd., (1917) 2 KB 664. Viscount Reading while dealing with the order made by Sankey J. observed that although the question involved was largely one of fact, still if the trial Judge could be shown to have not paid proper attention to certain essential facts which required to be noticed, that would justify interference with the discretion of the trial Judge. It was said that if the conclusion of the trial Judge depended solely on the view which he took of the evidence and did not depend on any view of law, there should be no occasion for differing from him. In that case, the bill of lading for antimony oxide ore stated that 937 tons had been shipped on board; in the margin was a typewritten clause : "a quantity said to be 937 tons", and in the body of the bill was printed in ordinary type the clause : "weight, measurement, contents and value unknown." It was held that the bill of lading was not even prima facie evidence of the quantity of ore shipped and that in an action against the shipowners for short delivery, the onus was upon the plaintiff of proving that 937 tons had, in fact, been shipped. While dealing with this aspect of the matter, Viscount Reading C. J. observed that no attention had been paid to the words, "weight unknown." It is remarkable that in this case also the bill of lading besides providing for the venue for settlement of disputes arising out of the contract, contains a distinct clause to the effect that "weight, measure, marks, numbers, quality, contents and value if mentioned in the bill of lading are to be considered unknown unless the contrary has been expressly acknowledged and agreed to. The signing of this bill of lading is not to be considered as such an agreement." It is quite clear from the written defence as well as from the appellant's application for stay of the action, that the question of the weight of the cargo said to have been short-landed is very much in dispute. These are questions which, we think, were very material but it does not appear that proper consideration was given to these aspects of the matter. The only observation which the learned Judge made was that applications of this type had become fairly frequent and he proceeded to dispose of this one by stating that the shipper might give evidence as to the total weight of the goods shipped and deducting therefrom the weight of the goods received in Calcutta, the plaintiff might be able to prove the actual weight of the goods which it did not receive. The learned Judge posed the question that it would perhaps be necessary for the shipper to give evidence but did not pursue the matter further. This conclusion involved the assumption that the evidence of the shipper would be readily available. It is to be observed that the shipper is a Swedish citizen and his evidence would be essential to prove the total weight of the cargo actually shipped. Unless that evidence, which we consider to be very material, is available, it is not quite easy to see how the plaintiff can establish his claim to an amount of Rs. 12,849/13/- on account of the alleged short-landing of 14 bundles. We are, therefore, constrained to hold that all aspects of the matter have not received due consideration at the hands of the learned Judge and we, accordingly, feel free to interfere with his discretion if such interference is otherwise justified.
11. The appeal has been strenuously resisted on the ground that we should not, in the circumstances of this case, interfere with the discretion of the trial Court To strengthen this argument, the written defence and the applicant's application for stay have been referred to for the purpose of inducing us to hold that there is no genuine dispute in this case as regards the weight of the goods. We do not agree; the total weight of the entire cargo shipped must be determined and the total weight of the cargo received must be ascertained in order that the value of the allegedly lost bundles might be known. That being so, the conclusion is inescapable that the shipper's evidence would be the most material evidence in the case. As we have said, he is a Swedish citizen and we shall be too optimistic to think that he would be readily available before a Calcutta Court. After all, the contract was one entered into between a Swedish Company and a Swedish citizen. It was a contract made in Sweden. The cargo was carried in a Swedish vessel which flew the Swedish flag. The vessel appears to have passed several Intermediate ports which were the ports of call and eventually reached Calcutta where, according to the plaintiff, the goods were short-landed. Therefore, these are the links in the chain in respect of which evidence is required to be produced. At this end, the evidence of the Port Commissioners would, indeed, be very valuable. That evidence has to be produced just as at the other end, the evidence of the shipper appears to be indispensible. We are not quite sure whether the evidence of the Customs authorities would be material but we are not expressing any final opinion on this aspect of the matter; but in order that short-landing may be established, the plaintiff has to prove his case by proving the weight of the total cargo shipped at Gothenburgh and the weight of the cargo landed at the Calcutta port. The plaintiff Company charged the defendant with breach of duty as common carriers since it failed to carry 14 bundles of Flats safely and securely. This naturally involved proof of handling at intermediate ports. At the hearing before us, learned Counsel for the respondent offered to give up this part of the case and contented himself by confining the allegation to failure to deliver the 14 bundles at the Calcutta port. We are not pronouncing on this concession. Even if we are to give effect to it, the question would still remain that the plaintiff, if it has a case at all, must prove the total weight of the cargo shipped at Sweden and the weight of the cargo landed at Calcutta.
12. The circumstances to which we have referred would indicate that there is nothing of an overwhelming nature which would induce the Court to think that the action ought to be tried in Calcutta. It is true, if the plaintiff is asked to pursue his remedies in Sweden, it would be required to take witnesses from Calcutta. Similarly, if the defendant Company was to submit to the proceedings before a Calcutta Court, it would naturally be subjected to inconvenience and harassment in order to establish its case. That being the position, we do not think there is any circumstance of such overwhelming character as might reasonably induce us to think that the forum of choice stipulated in the contract contained in the bill of lading should be given the go-by. Generally speaking, the Courts try to hold contracting parties to their bargain. In this case, we have found nothing wrong in the contract contained in the bill of lading and when parties with their eyes wide open entered into an agreement to have their dispute settled in Sweden according to Swedish law, it would, we think, be improper, in the absence of any circumstance of an overriding nature to supersede that agreement.
13. We have been addressed at length by both parties on the question of relative convenience or inconvenience resulting from the action being tried either here in Calcutta or in Sweden. It is unnecessary to go into the details of such argument. Suffice it to say that we have found nothing in this case which would entitle us to supersede the choice of forum deliberately made by the parties and indicated in the contract contained in the bill of lading.
14. On behalf of the respondent, Mr. Ghose attempted to argue that the performance of the contract was subject to the law of India and accordingly the action ought to be tried here under the Indian law. To strengthen the argument, reliance was placed upon Sub-rule (1) of Rule 147 in the Chapter on Contracts in Dicey's Conflict of Laws. The sub-rule says that the mode of performing particular acts under a contract of affreightment, for example, the loading or unloading or delivery of goods may be governed by the law of the country where such act takes place. This sub-rule has to be read in conjunction with the parent Rule 147 which says that "the validity, interpretation and effect of a contract of affreightment are governed by the proper law of the contract. If from the terms or objects of the contract or from the circumstances under which it was made, no inference can be drawn as to the law which the parties intended to apply, the law of the flag is the proper law of the contract"
We are afraid, the last part is not attracted but Rule 147, read as a whole, suggests that the interpretation of a contract of affreightment is to be governed by the "proper law of the contract." In this case, the contract was entered into in Sweden by Swedish parties. The respondent Company is after all, an endorsee, a holder for value, who came to acquire interest in the bill of lading subsequently. Could it be said that, by reason of acquisition of such interest at a later point of time, the endorses entitles itself to privileges which the original shipper did not possess? The rights of an endorsee are not generally larger than those of the original holder. But that is another aspect of the matter which we need not pursue. It is plain in this case there is no ambiguity whatever. The provision contained in the bill of lading is a plain provision which must receive effect. If there is any doubt as to the intention of the parties as respects the venue for settlement of disputes, it may well become necessary for the Court to impute an intention, taking into account the surrounding facts and circumstances. Here the intention is expressed Without equivocation and we think such intention must be given effect to In Halsbury's Laws of England (Lord Simond's Edn.), (3rd Edn.), Vol. 7, there is an instructive passage under the head, "Law Chosen by Parties". It is said that "where parties expressly stipulate that the contract shall be governed by a particular law, that law will be the proper law of the contract provided the selection is bona fide and there is no objection on the ground of public policy and, apparently, even where the law has no real connection with the contract."
There is no allegation in this case that the choosing of the forum for settlement of disputes was, in any way, mala fide or there is anything in the contract which goes against public policy. That being the position, we think it becomes the duty of the Court concerned to give effect to the agreement between the parties and relegate them to the forum deliberately chosen by them and expressed in the written agreement.
15. A similar question arose before the Supreme Court in the case of The Delhi Cloth and General Mills Go. Ltd. . At page 419, a passage from Cheshire is set out in which an observation made by Lord Atkin was relied upon; the noble Lord said that "when no intention is expressed in the contract, theCourts are left to infer one by reference to considerations where the contract was made and how and where, it was to be performed and by the nature of the business transaction to which it refers."
16. It is well-known that the choice of tribunal decided upon by the parties in an arbitration agreement can, in certain circumstances, be superseded. The case of Bristol Corporation v. John Aird and Co., 1913 AC 241, is an instance in point. There the contractor executed certain works under a contract in which a provision had been made for reference of disputes to the Engineer of the other party to the contract. But in the circumstances of the case a conflict became inescapable as regards the position of the arbitrator since he happened to be placed in the position of a judge and witness. The Court accordingly held that that was a sufficient reason why the dispute should not be referred to his arbitration in accordance with the terms of the contract. Lord Atkin observed that he could not read anything in the contract from which it could be said that the arbitration agreement should be given effect to despite the fact that the judge chosen by the parties had become in the circumstances of the case both a judge and witness. But Lord Moulton's observation made in this context may usefully be recalled :
"A man is not deprived of his right to come to the Court and bring his disputes there, but the Court is invested with a discretion to refuse to him its assistance, if he had contractually bound himself to go to a domestic, tribunal and nothing had happened which would make it unjust for the Court to insist on his keeping the bargain."
Thus these observations in their totality do not, in our view, affect the position in the present case since there has happened nothing which can reasonably incline us to the view that although the Court in Sweden has jurisdiction to deal with the dispute still there are circumstances which would justify abrogation of the tribunal which the parties have bargained in their contract for settlement of their disputes.
17. The Fehmarn case reported in (1958) 1 All ER 333 has been relied upon on behalf of the respondent in aid of the contention that even though the contract might have provided for decision of disputes arising out of it in Sweden, nevertheless the Calcutta Court where proceedings have actually been commenced ought to be allowed to deal with them and decide the dispute. Lord Denning's observation, that the choice of law in a contract is not always decisive and the dispute in a given case has to be examined closely with a view to finding out where most appropriately it can be decided, has been relied upon on behalf of the respondent. That was a case where the contract had been made in Russia. The cargo was loaded at a Russian port by a Russian shipper on board the "Fehmarn" which was a German ship. In terms of the contract, the cargo was delivered at the port of London in apparent good order and condition. An English Company purchased the cargo and became the holder for value of the bill of lading which included a stipulation that all questions in dispute should be governed according to Russian law and adjudged in that country. The question arose whether in the circumstances the Admiralty Court had jurisdiction to deal with the dispute. On a consideration of the material circumstances, the Court of Appeal came to the conclusion that although Courts make people abide by their contract and insist on parties honouring their bargain, the dispute in the case was more closely connected with England than with Russia and that was one of the reasons which induced the Appeal Court to hold that despite the stipulation contained in the bill of lading, the action might well be maintained in the Admiralty Court in England, it is to be observed that there was no objection in this case by the shipowners to the action being tried in England. That, in our view, was an important consideration which weighed with the Court in giving the decision that the dispute should be tried by the Court in England in spite of the provision to the contrary contained in the bill of lading. It was, after all, a dispute in which the owner of the cargo was an Englishman and the cargo had been carried in a German vessel and brought to England. Only the goods were loaded at a Russian port by a Russian shipper who ceased to have any interest in them as scon as the bill of lading was endorsed in favour of an Englishman. In those circumstances, the Court held that the whole thing was very much English and very little Russian. Even applying the test laid down in this case, we do not think it could reasonably be said that the dispute in the present case is preponderatingly Indian and not Swedish.
18. In view of the foregoing, we do not think there is substance in the Respondent's contention that the dispute should not be decided by the Swedish Court according to Swedish law. Nor do we think it is necessary to pursue the matter further since we are clearly of the opinion that there is nothing in the contract contained in the bill of lading which militates against public policy or suggests bad faith on the part of the contracting parties which would justify supersession of the chosen forum.
19. Reliance was placed on the decision in the case of Serajuddin And Co. v. Michael Golodetz, , where the Court was called upon to consider an arbitration agreement which contained a clause to the effect that any dispute arising out of the contract was to be settled by arbitration in New York according to the laws of the American Arbitration Association. It was held, upon a review of the facts of the case, that the stipulated forum would not be a safe or convenient forum, for a just decision of dispute between the parties; in such circumstance, to compel a party to seek its remedy in America would practically amount to denial of justice as there was no sufficient reason for referring the dispute to arbitration and staying the suit. The effect of this decision, as far as we can see, is that it is always open to the Court, upon the facts of each case, to arrive at a conclusion as to whether a certain arbitration clause ought to be superseded or not. Nothing has beer, said in this case which might militate against the view we have taken and expressed above. The case before us is one in which the forum chosen is a public tribunal whereas in the case decided to which we have just referred it was a private tribunal. We do not think that it would be always right to equate a private tribunal with the Court or public tribunal.
20. The view we have taken finds support in a case decided by Lahiri C. J. and Bachawat J. , Messrs. Lakhinarayan Ramniwas v. Lloyd Triestino Societa Per Azinni De Navigaziene Sede in Triesta. That was a case in which an order for stay had been made by the trial Judge. An appeal was taken against that decision but the appeal was dismissed with the consequence that the proceedings in this Court remained stayed pending institution of a suit in a foreign court. It was held that although a contract between the parties cannot be pleaded to bar the jurisdiction of the court which it possesses, the court can always act on the principle that it will compel the parties to abide by their contract. There was an agreement between the parties that disputes, if any, between them would be referred to the Judicial Authority in Italy. That agreement was upheld. The question of convenience of parties and witnesses was also taken into account and it was held that in the absence of anything overwhelmingly in favour of a trial being held in this country, the action ought to be tried in the forum the venue of which had already been determined by agreement between the parties. It is useful to remember that the learned Judges called attention to the duty of being just and fair in every case while considering the question of convenience. We have applied this test to the facts of the case before us and we find that it would be in consonance with justice and fair play to stay the suit pending institution and disposal of such proceedings in Sweden as the respondent may be advised to take to enforce its remedies.
21. The decision last referred to was followed by this Court in an unreported decision of this Court D/- 18-8-1960 in the case of Lloyd Triestino v. Herman and Mohatta (India) Private Ltd. My Lord, the Chief Justice delivered judgment and held in effect, that it is only right and proper to hold parties to their bargain when they have with "eyes wide open" entered into it. It was observed that the plaintiff Company in that case having taken assignment of the bill of lading which contained a provision for determination of disputes arising in relation to the contract by the Italian Courts, it must be presumed that it had full notice of the clause contained in the contract of carriage. The actual words used were ;
"Having taken the assignment of the bill of lading with eyes wide open and knowing full well about the existence of foreign exchange restrictions in this country, it is not open to the plaintiff Company now to turn round and ask the Court to be relieved of the obligation which is imposed on the parties by that clause,"
I respectfully agree with this view and I think that the facts of the present case are very similar to those which were being dealt with in the judgment last referred to.
22. There remains the question of limitation. It has been argued that if the respondent Company is now to be relegated to a suit in Sweden, possibly the claim will be, held barred. There are materials on the record which appear to suggest that the claim may be barred. At one stage of the argument, certain facts were canvassed which had direct bearing on the question of limitation. On the materials such as they are, we are unable to decide that question. In our view, the matter requires fuller investigation not only of the law applicable but also of the facts to which the law is to be applied. We do not consider it necessary to do so either; but we wish to make it clear that it would be perfectly open to the plaintiff respondent to prosecute his suit here in this Court in the event of any action brought in the Swedish Court being held barred by limitation.
23. The present suit will therefore be stayed subject to the condition that it will proceed only if the suit hereafter to be filed in Sweden is held barred by time.
24. The order appealed from is accordingly set aside and the appeal is allowed to the extent indicated above.
25. If the suit to be filed in Sweden is dismissed on the ground of limitation, the stay will automatically stand vacated and the trial of the suit filed in this Court will be proceeded with.
26. Each party will pay and bear its own costs.
27. Certified for two Counsel.
28. I agree.