Case: Gatoil International Inc v Arkwright-Boston Manufacturers Mutual Insurance Co [1985] AC 255
Outcome: applied
Mr Cutler argued that the correct approach to the interpretation of s 4(3)(f) could be found in Port of Geelong Authority v The 'Bass Reefer' (1992) 37 FCR 374 at 380-82 in which case Foster J adopted the approach of Lord Keith of Kinkel in Gatoil International Inc v Arkwright-Boston Manufacturers Mutual Insurance Co [1985] AC 255 at 270-71 and said that the relationship connoted by the words "that relates to" in s 4(3)(f) must be "some reasonably direct connection". The same passage from Lord Keith's speech in Gatoil [1985] AC at 270-71 was cited with apparent approval by Gummow J in Empire Shipping Company Inc v Owners of the Ship 'Shin Kobe Maru' (1991) 32 FCR 78 at 95 (at first instance). 27 These submission are answered by the proper application not only of Gatoil [1985] AC 255, but also of Samick Lines Co Ltd v Owners of the 'Antonis P Lemos' [1985] AC 711. Two phrases in s 4(3)(f) are central to understanding the reach of the provision in the circumstances here: " a claim arising out of an agreement" and " that relates to the carriage of goods... by a ship ". The former was the subject of consideration in The 'Antonis P Lemos' [1985] AC 711, the latter in Gatoil [1985] AC 255. 31 The ALRC Report made reference to both Gatoil (at [168] and [173] of the ALRC Report) and The 'Antonis P Lemos' (at [146] and [169] of the ALRC Report). No particular assistance is obtained from the discussion of these cases in the Report. The ALRC did recommend, however, in the context of these cases, that the proposed head of jurisdiction (s 4(3)(f)) follow the language of the Supreme Court Act 1981 (UK) (the "1981 UK Act"), s 20(2)(h), which was the provision dealt with in The 'Antonis P Lemos' and which was the successor provision to the Administration of Justice Act 1956 (UK) (the "1956 UK Act"), ss 1(1)(h) and 47(2)(e), being the relevant provisions dealing with England and Scotland, respectively, discussed and dealt with in Gatoil. 32 Section 4(3)(f) did follow, though not precisely, the language of the 1981 UK Act, s 20(2)(h). That section was as follows: "any claim arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship" 33 The 1956 Act, ss 1(1)(h) and s 47(2)(e) were in the following terms: s 1(1)(h): "any claim arising out of any agreement relating to the carriage of goods in a ship or to the use of hire of a ship;..." s 47(2) Any claim arising out of any one or more of the following: ... (e) any agreement relating to the carriage of goods in any ship whether by charterparty or otherwise;..." 34 It is also important for the application of the principles attending construction of the Act to which I have referred to understand that the provisions in the 1956 UK Act (and, through it the 1981 UK Act) were passed to enable the United Kingdom to ratify and to comply with its international obligations under the 1952 Convention: The 'Eschersheim' [1976] 1 WLR 430 at 434 (per Lord Diplock) and Gatoil [1985] AC at 266 (per Lord Keith). Article 1(1) of the 1952 Convention contained the following as part of the list of "maritime claims": "Maritime claim" means a claim arising out of one or more of the following: ... (d) agreement relating to the use or hire of any ship whether by charterparty or otherwise; (e) agreement relating to the carriage of goods in any ship whether by charterparty or otherwise; ... 35 Thus, both Gatoil and The 'Antonis P Lemos' can be seen as unanimous decisions of the final court of appeal in the United Kingdom interpreting domestic legislation having its origins in an international convention, one aim of which was to bring uniformity of approach among different legal systems. The existence of those decisions, the desirability of international uniformity, or at least broad consistency, and an expressed suggestion by the ALRC (which was heeded) that Parliament follow the wording of the 1981 UK Act, which had been (recently) interpreted (as well as the antecedent provision in the 1956 UK Act) by the House of Lords in Gatoil and The 'Antonis P Lemos' necessarily constrain the interpretation of s 4(3)(f), certainly at first instance. Further, two judges, of this Court (Foster J in The 'Bass Reefer' and Gummow J in The 'Shin Kobe Maru' ) at first instance have applied Gatoil. 44 The next question is whether any one or more of these agreements answers or answer the description of " an agreement that relates to the carriage of goods... by a ship ", as that phrase was interpreted by the House of Lords in Gatoil. 45 In Gatoil [1985] AC 255 Lord Keith of Kinkel (with whose speech Lords Fraser of Tullybelton, Scarman, Wilberforce and Roskill agreed) concluded that the phrase "related to" should not be construed widely, but rather there should be "some reasonably direct connection" with the activities described in the provisions (there ss 1(1)(h) and 47(2)(e) of the 1956 UK Act). 47 It is also to be noted that the limited approach to the construction of the provision in Gatoil was put forward to the House in The 'Antonis P Lemos' as a reason for narrowly construing the phrase "arising out of" in s 20(2)(h). Lord Brandon dealt with this principally by recognising the textual importance of "arising out of" in the 1952 Convention and demonstrating the clearly unintended consequences of giving that phrase a narrow meaning there and in all the places in the 1956 UK Act and 1981 UK Act where the phrase appears. 48 It is also be noted that in The 'Antonis P Lemos' at 730 Lord Brandon expressed the view that what " tilted the balance in favour of giving a narrow meaning to the expression 'relating to '" was the existence of two authorities, The 'Zeus' (1888) 13 PD 188 and The 'Aifanourios' [1980] SC 346 (the reasoning in which latter case can be seen as contrary to some of the comments of Lord Brandon about the natural and inevitable overlap in the list of maritime claims). Lord Brandon said (at [1985] AC at 730 G-H) that in the absence of these authorities it might not be right to give the expression "relating to" (in s 4(3)(f) "relates to") a narrow meaning as given by the House in Gatoil . 50 For the reasons that I have earlier given, however, it is not appropriate that, sitting at first instance, I do other than apply Gatoil . Further, in what might be said to be in support of a wide construction of "arising out of" and a narrower approach to "relates to", the former expression should be wide to catch all claims that have a connection with an agreement that has the appropriate maritime connection or character. The appropriate maritime connection or character for s 4(3)(f) might be seen to be assisted by the recognition that all the general maritime claims in Article 1 of the 1952 Convention and in s 4(3) are expressed to be the foundation of an action in rem against a ship and to found the remedy of arrest. The relational connection in the phrase "that relates to" is to be seen in that context. It also may be important to see the appropriate maritime connection by reference to the Constitutional reach of s 76(iii). Section 4(3) must at all times be construed within the confines of the Constitutional authority given to Parliament: cf the Acts Interpretation Act 1901 (Cth), s 15A. 51 Approaching the matter by applying Gatoil , does or do any one or more of the agreements referred to in [43] above have a reasonably direct connection with the activity of carriage of goods by a ship and thereby "relates or relate to the carriage of goods by a ship" for s 4(3)(f)? 52 The answer, it seems clear to me, is "yes". As to the first agreement posed, that between the defendant and Planetwide, that agreement was essential to the performance of the sea carriage. The cars had to be loaded into the shipping container in preparation for sea transport. That is what the defendant undertook to do. The loading of the container was, in substance, for the sea carriage. Although the Planetwide bill was not issued until 12 August 2003, it can be concluded that the agreement between Planetwide and the defendant was in fact to perform obligations which (on the evidence, later) Planetwide undertook in the Planetwide bill to undertake as carrier. The agreement to load the shipping container between the arranger of the carriage and its subcontractor had a reasonably direct relationship with the carriage of goods by the ship.