Paramount Enterprises International, Inc. v. An Xin Jiang ( The )
T-956-97
Tremblay-Lamer J.
17/12/97
17 pp.
Appeal from Prothonotary's decision in rem portion of plaintiff's action could not be brought against either ship An Xin Jiang or cargo on ground disclosing no reasonable cause of action-Plaintiff and defendants entering into Conlinebooking charter-party under which plaintiff agreeing to transport defendants' cargo of dynamite from China to Quebec-Plaintiff making arrangements for plaintiff's ship Len Speer to transport cargo-Shortly afterwards, plaintiff informed cargo would be transported on board An Xin Jiang, ship belonging to China Ocean Shipping Group (Cosco), causing plaintiff loss of $175,000-Plaintiff bringing action in personam against defendants for non-performance of contract, and against Cosco for interference in Conlinebooking charter-party-Also attempting to exercise rights resulting from breach of contract in rem against cargo of dynamite, and rights resulting from interference by Cosco against An Xin Jiang-Prothonotary striking out in rem portion of action on ground An Xin Jiang not ship to which plaintiff's action related (action brought against Conlinebooking charter-party for carriage of dynamite on board Len Speer)-Prothonotary also holding plaintiff could not rely, in tort, on agreement between Cosco and other defendants respecting chartering of An Xin Jiang, to which plaintiff not party-Prothonotary also dismissing action in rem against cargo on ground disclosing no reasonable cause of action, as basis for action charter-party and no sufficient connection thereunder between plaintiff and cargo to entitle plaintiff to bring action in rem, since plaintiff never in possession of cargo-Appeal allowed in part with respect to action in rem against cargo and cancellation of bank letter of guarantee-Concerning action in rem against An Xin Jiang, no connection between plaintiff and ship-An Xin Jiang subject of second agreement between Cosco and defendants-Plaintiff's cause of action independent of second agreement-Nor sufficient connection between ship and plaintiff for action in rem in tort-Concerning action in rem against cargo, Federal Court Act, s. 43(2) permitting action in rem against "other property" subject of action-In instant case, cargo of dynamite "property" as defined in Act, s. 2(1) whether on board Len Speer or not, and also subject of action, that is, of Conlinebooking charter-party-Language of s. 43(2) not requiring either cargo be on board or not on board ship, or there be maritime or possessory lien, in order to found action in rem against cargo-Fact this interpretation would permit seizure in rem of cargo on board ship belonging to innocent third party not reason to depart from plain meaning of words in s. 43(2)-Thus, sufficient cargo subject of action in order for plaintiff to exercise rights in rem, as in instant case-Plaintiff's action arising out of defendants' failure to fulfil contractual obligations under Conlinebooking charter-party-Cargo of dynamite actual subject of charter-party-In addition, plaintiff had started to perform contractual obligations-Sufficient to have commenced to perform contractual obligations for connection required for action in rem to arise-Therefore not plain and obvious action in rem against cargo should be struck out-Prothonotary's decision cancelling bank letter of guarantee supplied by Cosco accordingly set aside-Federal Court Act, R.S.C., 1985, c. F-7, ss. 2(1), 43(2).