GUANGZHOU MARITIME COURT OF THE PEOPLE??S REPUBLIC OF CHINA

Civil Judgment


(2004) GHFCZ No.312


Plaintiff	:	Henan Cereals Oils and Foodstuffs Import and Export (Group) Co., Ltd. 

Domicile	:	23, Jingqi Road, Zhengzhou, Henan Province, P. R. China

Legal Rep.	:	Yu Huiqing, Chairman of the Board

Agent ad litem	:	Li Hongji, Attorney at Commerce & Finance Law Offices

Agent ad litem	:	Zhang Wei, Attorney at Commerce & Finance Law Offices

		

Defendant	:	Saint Vincent Shipping Inc.

Domicile	:	RCM Building, 1418 Marcelino Street, Ermita, Philippines

Legal Rep.	:	Edwin M. Cristobal, General Manager and Director of the Company

Agent ad litem	:	Chen Xiangyong, Attorney at Wang Jing & Co., Law Firm

Agent ad litem	:	Zhong Cheng, Attorney at Wang Jing & Co. Law Firm

		

Defendant	:	Noble Europe Limited

Domicile	:	1/F., 18 Buckingham Gate London SWIE 6LB, United Kingdom

Legal Rep.	:	Nigel Alexander Herdman, Director 

Agent ad litem	:	Yang Wengui, Attorney at Hai Tong & Partners Law Firm

Agent ad litem	:	Tong Mei, Attorney at Hai Tong & Partners Law Firm

		

Defendant	:	Noble Grain Pte Limited

Domicile	:	600 North Bridge Road, #10-08, Parkview Square, 188778 Singapore

Legal Rep.	:	Mahesh Asrani, Director 

Agent ad litem	:	Yang Wengui, Attorney at Hai Tong & Partners Law Firm

Agent ad litem	:	Tong Mei, Attorney at Hai Tong & Partners Law Firm

	:	

Defendant	:	Noble Chartering Limited

Domicile	:	18th Floor, MassMutual Tower, 38 Gloucester Road, Hong Kong

Legal Rep.	:	Banga Harindarpal Singh, Director 

Agent ad litem	:	Yang Wengui, Attorney at Hai Tong & Partners Law Firm

Agent ad litem	:	Tong Mei, Attorney at Hai Tong & Partners Law Firm


With regard to disputes over the contract of carriage of cargo by sea between the Plaintiff, Henan Cereals Oils and Foodstuffs Import and Export (Group) Co., Ltd. (?°Henan Cereals Oils?±), and the Defendant, Saint Vincent Shipping Inc. (?°Saint Vincent?±), the Plaintiff brought a lawsuit before this Court on 7 September 2004 and superadded Noble Europe Limited (?°Noble Europe?±) as the joint Defendant. This Court accepted the case on 20 September 2004, and formed a collegial panel in accordance with laws, of which, Judge Feng Ziming acted as the Presiding Judge, Judge Gong Jie and Acting Judge Zhang Kexiong attended the deliberation. On 8 March 2005, the Plaintiff superadded Noble Grain Pte Limited (?°Noble Grain?±) and Noble Chartering Limited (?°Noble Chartering?±) as joint Defendants. Within the period of adducing the bill of defence, the Defendants, Saint Vincent and Noble Europe, both filed objections to the Court??s jurisdiction over the case. Through examination, the Court made rulings on 13 January 2005, dismissing the jurisdiction dissension raised by the two Defendants. The four Defendants dissatisfied with the rulings and filed appeals to the Higher People??s Court of Guangdong Province. On 15 March 2006, the Higher People??s Court of Guangdong Province dismissed the Defendants?? appeals, and sustained the rulings entered by this Court. Personnel relocation was made to the collegial panel on 13 April 2006, as a result of which, Judge Wu Zili acted as the Presiding Judge, while Acting Judge Huang Xiwu and Acting Judge Fang Jianhua attended the deliberation on this case. Later, due to the resignation of Fang Jianhua, the collegial panel was adjusted to consist of the Presiding Judge Wu Zili, Judge Song Weili, and Acting Judge Huang Xiwu. The Court convened public hearings on this case from 22 May to 25 May 2007 and from 27 August to 28 August 2007. Li Hongji and Zhang Wei acting for the Plaintiff; Chen Xiangyong, the agent ad litem of Saint Vincent; Yang Wengui and Tong Mei, the agents ad litem of Noble Europe, Noble Grain and Noble Chartering attended the court hearings. This case has now been closed.


The Plaintiff asserted as follows: the Plaintiff concluded two contracts for international sales of cargo (No.NC070586 and No.NC070316-B) with Noble Grain on 25 February 2004, in which it was agreed that the Plaintiff would purchase 20,000tons and 35,000tons of Brazilian soyabeans respectively from Noble Grain. The cargo would be shipped between 1 April and 25 April 2004, and the port of destination was Chiwan, Shenzhen. On 17 April 2004, Noble Grain delivered the cargo to M/V ?°SEAFARER?± owned by Saint Vincent for carriage. After investigation, it was found that Saint Vincent was the actual carrier and Noble Europe was the carrier. After the cargo were shipped onboard the vessel, the agent of M/V ?°SEAFARER?± issued two clean bills of lading, specifying that the quantity of the cargo was 22,000tons and 37,725.734tons respectively, totaling 59,725.734tons. Later, the Plaintiff acquired these two bills of lading by negotiating the Letter of Credit. Noble Grain sent notices to the Plaintiff on 18 April 2004 and 12 May 2004, informing the Plaintiff that the aforesaid 59,725.734tons of soya beans was estimated to arrive at the port of discharging (namely Chiwan Port) on 24 May 2004. However, M/V ?°SEAFARER?± did not arrive at the discharging port until 29 June, due to her frequent stopover and unreasonable deviation during the voyage. The quality of the cargo deteriorated due to the long-time carriage, which thus gave rise to a huge cargo loss. As a result of the aforesaid ship??s delay, the Plaintiff breached contracts with their clients, and had to assume the liability arising therefrom. Meanwhile, the delay of the arrival of the cargo also gave rise to a loss incurred by price difference, and the losses sustained by the Plaintiff and the end user, such as the transportation fees, warehousing fees, and financial costs. The losses sustained by the Plaintiff and the end user were verified to be in the amount of about RMB53,800,000 (unless otherwise stated, the currency referred hereunder is RMB). Under the present case, Noble Europe, Noble Grain, and Noble Chartering shall be deemed as an inseparable whole and jointly undertake the carrier??s liability. Saint Vincent was the actual carrier in the case, and therefore should be jointly and severally liable for the loss incurred therefrom. The Plaintiff, as the holder of the bills of lading, brought this suit on the ground of the contractual relationship established by the Contract of Carriage of Cargo by Sea evidenced by the bills of lading, and had standing to claim compensation against the carriers and the actual carrier. The Plaintiff requested the Court to order as follows: Noble Europe, Noble Grain and Noble Chartering should jointly assume the carrier??s liabilities, and compensate the Plaintiff for the losses in the amount of RMB53,800,000, and bear all the preservation fees and litigation costs; Saint Vincent shall be jointly and severally liable for the aforesaid losses.  


The Plaintiff submitted the following evidence to support their arguments: 1. Letter of Confirmation sent by Noble Grain, proving that Shantou Zhongxing Grease Co., Ltd. (?°Shantou Zhongxing?±) was the buyer and the actual user of 55,000tons of South American soya beans; 2. Sales Contract No. NC070316, proving that Shantou Zhongxing was the buyer and the actual user; 3. Letter of Guarantee received by Noble Grain, proving that Shantou Zhongxing was the buyer and the actual user; 4. Letter sent by Shantou Zhongxing to Noble Grain, proving that the Plaintiff was the import agent; 5. Letter sent by the Plaintiff to Shantou Zhongxing, proving that the Plaintiff was the import agent; 6. Supplementary Agency Agreement for Import of Soya beans, proving that the Plaintiff was the import agent; 7. Sales Contract No.NC070316-B, and Sales Contract No.NC070586, proving that the Plaintiff, acting as the import agent of Shantou Zhongxing, concluded contracts with the seller, and that Noble Grain knew Shantou Zhongxing was the actual user and the end user of such 55,000tons of South American soya beans; 8. Letter regarding the conditions of the vessel, proving that M/V ?°SEAFARER?± was the vessel carrying 55,000tons of South American soybeans; Noble Grain sent letters to Shantou Zhongxing and the Plaintiff, evidencing that it knew Shantou Zhongxing was the end user while the Plaintiff was the import agent; 9. Charter Party, proving that the Noble Europe concluded, in the name of the carrier, such charter party with Noble Grain; 10. Bs/L No.1&2, proving that if without contradiction to other evidential materials, Noble Grain, as the issuer of the bills of lading, may be deemed as the carrier; 11. Two Shipment Notices, proving that M/V ?°SEAFARER?± was estimated to arrive at Chiwan Port, China on 24 May 2004; 12. Two Commercial Invoices, proving that the average unit price of soya beans was USD420.48/ton; 13. Letter of Pricing sent by Shantou Zhongxing, proving that Shantou Zhongxing fixed the price of soya beans, which showed Shantou Zhongxing was the end user and Noble Grain was aware of such fact; 14. Letter regarding the chartering of M/V ?°SEAFARER?± by Noble Chartering, proving that Noble Chartering was the charterer and the carrier in the present case; 15. Instructions given by Noble Chartering, proving that on 21 May 2004, M/V ?°SEAFARER?± had already berthed off Singapore and under normal circumstances she certainly could have arrived at Chiwan Port on 24 May 2004; 16. Instructions given by Noble Chartering, proving that Noble Chartering and M/V ?°SEAFARER?± deliberately stayed off Singapore for 2 days; 17. Estimated Arrival Notice issued by the Master of M/V ?°SEAFARER?±, proving that even though the vessel stayed off Singapore for 4 days without any reasonable reasons, the vessel could still arrive at the discharging port on 29 May; 18. Notice of Arrival issued by the Master of M/V ?°SEAFARER?±, proving that M/V ?°SEAFARER?± was in good conditions in all aspects and would arrive at the discharging port on 29 May; 19. Notice of Arrival issued by Shenzhen United International Shipping Agency Co., Ltd. (?°SUNISCO?±), proving that the shipping agent informed Shantou Zhongxing that the vessel was estimated to arrive at Chiwan Port at 1800hrs on 29 May; 20. Letter sent by SUNISCO to the Master, proving that M/V ?°SEAFARER?± was under normal sailing condition on 28 May; 21. Instructions given by Noble Chartering, proving that Noble Chartering and M/V ?°SEAFARER?± maliciously delayed the voyage and should be held liable for the losses arising from the delay in delivering the cargo; 22. Notice issued by SUNISCO, proving that SUNISCO made up an excuse and in fact it was because of the mechanical breakdown that Noble Chartering instructed M/V ?°SEAFARER?± to proceed to and stay at Hong Kong OPL; 23. Letter sent by the Plaintiff and Shantou Zhongxing jointly to Noble Grain, proving that the Plaintiff and Shantou Zhongxing, as the buyer and the end user of the cargo, had no idea about the voyage conditions of M/V ?°SEAFARER?±, and Noble Grain failed to perform its obligation of notification; 24. Deck Logs, proving that no mechanical breakdown was found in M/V ?°SEAFARER?± during her whole voyage and the vessel could certainly have arrived at Chiwan on 24 May 2004, namely the estimated time of arrival, but Noble Chartering instructed the vessel to berth off Singapore from 21 to 25 May (namely 4 days) and later instructed the vessel to stay off Hong Kong waters for nearly one month, i.e. from 29 May to 25 June. The vessel set sail to LAMMA, Hong Kong on 26 June, but she berthed at LAMMA for one month, to wait for the charterer??s instruction. The vessel berthed at Chiwan Port on 21 July. Noble Chartering and Saint Vincent deliberately violated the provisions of the Maritime Code of the P. R. China, and stayed at sea for an unreasonable long time with the malicious intention to delay in arriving at the discharging port. Therefore Noble Chartering and Saint Vincent should indemnify the buyer and the end user for all the losses arising therefrom; 25. Letter from Noble Grain, proving that M/V ?°SEAFARER?± did not arrive at Chiwan port until 21 July 2004; 26. Payment Certificate of Import Duties, proving that the after-tax unit price of soya beans was RMB4,050/ton; 27. Weight Survey Certificate, proving that 107.434tons of the cargo were short-landed, and calculated as per the price of RMB4,050/ton, the loss incurred therefrom totaled RMB435,107.70; 28. Damaged Cargo Inspection Certificate issued by Shekou CIQ, proving that 268.627tons of soya beans were damaged, and calculated as per the price of RMB4,050/ton, the loss incurred therefrom totaled RMB1,087,939.35. The inspection fee was RMB34,556. The prolonged storage of soya beans in the cargo holds and the insufficient ventilation also resulted in serious deterioration of the quality of soya beans and a relatively low oil production rate; 29. Letter of Protest issued by Shenzhen Chiwan Wharf Holdings Limited (?°Chiwan Wharf Limited?±), proving that M/V ?°SEAFARER?± arrived at Chiwan Port on 21 July 2004, which was two months late than the due day. Due to the insufficient ventilation and the high temperature in summer, soya beans were damaged completely, as a result of which, the quality became deteriorated, the production cost increased and the oil production rate became lower; 30. Survey Report issued by Shantou CNAL, proving that due to the prolonged voyage, the quality of soya beans became deteriorated. As the main index of the quality of soya beans, acid value determines the oil production rate and the production cost. Acid value of soya beans at issue was relatively high and as a result the oil production rate thereof was low, which caused substantial loss to the end user; 31. Letter of Complaint from Clients, proving that the deterioration of soya beans carried by M/V ?°SEAFARER?± resulted in the poor quality of soya bean meals; 32. Contract and Invoice in support of Loss of Warehousing Costs, proving that due to the malicious delay in arrival at the discharging port, the warehousing cost paid by Shantou Zhongxing increased by RMB948,696.53; 33. Contract, Payment Voucher, and Receipt in support of the Payment of Liquidated damages resulted from breach of contract, proving that due to the malicious delay in arrival at the discharging port, Shantou Zhongxing had to pay liquidated damages resulted from breach of contract, equivalent to RMB18,709,000; 34. Contract and Invoice in support of Loss of Transportation Costs, proving that due to the delay of M/V ?°SEAFARER?± and the increase of transportation charge, the transportation costs of soya beans increased, giving rise to a loss of transportation costs in the amount of RMB1,251,500; 35. Proof of loss from low oil production rate: production of soya beans carried onboard M/V ?°SEAFARER?±, proving that the ship??s delay resulted in the poor quality of Brazilian soya beans, and a low oil production rate (only 17.64%, lower than the oil content of 20.35% tested at the port of loading). The production of soya bean oil decreased by 1,603.38tons, giving rise to a loss of RMB10,347,140; 36. Proof of Loss incurred from increase of production cost: the price of raw materials and auxiliary materials, consumption of soya bean under normal production, consumption of Brazilian soya beans at issue, and material collection list, proving that due to the ship??s delay, the production cost for Brazilian soya beans increased by RMB231,951; 37. Proof of Loss incurred from the differences of sales prices of soya bean oil and soya bean meals: the price of soya bean meals and soya bean oil from 4 June to 4 July 2004, and the actual sales contracts and invoices of soya bean meals and soya bean oil, proving that the loss incurred from the price differences of soya bean meals and soya bean oil produced from soya beans totaled RMB21,465,372.33; 38. Statement of Production concerning Brazilian soya beans at issue formulated by Shantou Zhongxing, proving that the ship??s delay resulted in the poor quality of Brazilian soya beans, and a low oil production rate (only 17.64%, lower than the oil content of 20.35% tested at the port of loading). The production of soya bean oil decreased by 1,603tons, giving rise to a loss of RMB10,347,140; 39 Urgent Report of Change of Quality of Soya beans carried by M/V ?°SEAFARER?± during Storage , proving that because soya beans at issue had been stored in the cargo holds for such a long time and the temperature within the cargo holds was too high, the natural property of soya beans distinctly changed and their quality became deteriorated; 40. Repayment Agreement, proving that because M/V ?°SEAFARER?± maliciously delayed her arrival, Shantou Zhongxing (namely the actual user) suffered from a great loss in the amount of over RMB50,000,000, as a result of which Shantou Zhongxing was unable to reimburse the Plaintiff for the advance payment made by the Plaintiff, equivalent to over RMB56,000,000; 41. Chart of Price Trend of Soya Beans from 2004 to 2005, proving that the price of soya beans kept decreasing since July 2004, as a result of which, the price of the relevant products, such as the salad oil and soya bean meals, also decreased; 42. Price List of Salad Oil and Price List of Soya Bean Meals, proving that the price of salad oil and that of soya bean meals from June to July 2004 in Guangdong respectively was RMB6470/ton and RMB2890/ton; 43. Brief Introduction to Alfalaval Company and its Guarantee on the products, proving that the equipment of Shantou Zhongxing was at a leading level in the world and the low extraction rate of the salad oil was closely related to the deterioration of soya beans; 44. Introduction for the relationship between the acid value and the free fat acid in the book Chemical Nature of Fat Acid and Oil, proving that loss of oil would increase by 2% for each increase of acid value. The acid value of soya beans at issue was rather high, giving rise to a low extraction rate of salad oil; 45. Quarantine Permit for the Entry Animals and Plants No.PB00041315, proving that the Plaintiff applied for and collected the Permit; 46. Letter in which the Plaintiff and Shantou Zhongxing requested Noble Grain to provide the Safety Certificate, and the Notice on the Acquirement of the Safety Certificate by Noble Grain, proving that Noble Grain did not acquire the Safety Certificate necessary for the imported genetically modified soya beans until 25 June 2004, and that was the reason why it requested M/V ?°SEAFARER?± to keep drifting and staying at sea; 47. Letter in which PICC Property and Casualty Company Limited, Shantou Branch (?°Shantou PICC?±) asked for the information of the voyage route, proving that according to common practice and general understanding, M/V ?°SEAFARER?± should have arrived at Chiwan port before 31 May 2004; 48. Notification of Inspection and Quarantine Treatment No.470100104024804, Certificate issued by SGS at the loading port, proving that the carrier issued clean Bs/L and the cargo should not have contained any sorghum halepense and sorghum almum parodi; however, when the cargo arrived at the discharging port, some sorghum halepense and sorghum almum parodi were found mixed with soya beans at issue. As a result, the time was delayed, the expenses increased and the cargo could not be resold, which caused loss to the Plaintiff. The carrier should be liable for the said loss sustained by the Plaintiff; 49. Civil Judgment numbered (2003) GHFCZ No.377 rendered by Guangzhou Maritime Court, proving that the carrier should be held liable for the loss resulted from soya beans mixed with sorghum halepense and sorghum almum parody; 50. Proof of L/C Payment, proving that the opening bank had already performed the obligation of payment; 51. Application for Appraisal, proving that the Plaintiff requested for an appraisal on the relationship between the extraction rate of soybean salad oil and the acid value of soya beans; 52. Application for ordering the Defendant to adduce evidence, proving that the Plaintiff requested Noble Grain to submit documents in support of Noble Grain??s receipt of L/C payment; 53. Letter sent by Noble Grain to the Plaintiff on 14 May 2004, proving that Noble Grain considered the cargo could arrive at the discharging port as scheduled; 54. Statement of Facts on Discharging Cargo from M/V ?°SEAFARER?±, this evidence was supplementary to Evidence No.32 submitted by the Plaintiff; 


The Defendant, Saint Vincent, contended as follows: 1. According to the terms and conditions under the Charter Party as incorporated into the bill of lading, and the legal opinions presented by the attorney from Britain, English law and Hague Rules shall apply to the case; 2. The Plaintiff was the import agent of the cargo at issue, rather than the actual consignee of the cargo, and therefore the Plaintiff was not qualified to claim compensation under the case. Furthermore, the evidence submitted by Henan Cereals Oils showed that most of the losses and fees were paid and collected by Shantou Zhongxing, whilst the Plaintiff did not suffer from any actual loss; 3. According to the Charter Party, Noble Chartering, Noble Europe, and Noble Grain should be deemed as a whole, or the representative or agent of each other. Therefore they should be deemed as the shipper (the seller of the cargo) and the final voyage charterer; 4. Saint Vincent, as the actual carrier, had properly and carefully take care and store the cargo during the whole voyage, and did not deviate during the whole voyage; 5. Saint Vincent should not be held liable for any delay loss claimed by the Plaintiff. The present case does not involve any delay in delivering the cargo. Saint Vincent had performed its obligation to reasonably dispatch the vessel. The stopover of M/V ?°SEAFARER?± at Hong Kong and in Singapore was caused by the instructions from the charterer. However, the more important reason for ship??s delay was the failure of Noble Grain and the Plaintiff in acquiring necessary documents for importing the cargo, such as the Inspection Certificate, the GMO Safety Certificate and the GMO Label and the trade disputes arising between the Plaintiff and Noble Grain. Furthermore, red beans being found in the cargo during the process of discharging had caused the further delay of M/V ?°SEAFARER?± at Chiwan port. Therefore Saint Vincent should not be held liable. Saint Vincent requested the Court to dismiss the claims filed by the Plaintiff against Saint Vincent.


Saint Vincent submitted the following evidence to support their arguments: 1. Bills of Lading (2 copies) and Charter Party, proving the legal relationship between the parties involved in the case and the laws applicable to the case; 2. Mate??s Receipt, proving that the cargo received onboard were in apparent good order and condition, with the clause of ?°Unknown?±, and the cargo were shipped by 11 different shippers; 3. Manifest, Stowage Plan, proving the stowage conditions of the cargo; 4. Ship??s Particulars, Certificate of Vessel Registry, International Tonnage Certificate, Cargo Ship Safety Construction Certificate, Cargo Ship Safety Equipment Certificate, Record of Equipment, Minimum Safe Manning Certificate, International Load Line Certificate, Document of Compliance, Crew List, Certificates of Competency of Crews, proving that Saint Vincent had exercised due diligence to make the ship seaworthy, properly man the ship, and make the holds fit for carriage of the cargo before and at the beginning of the voyage; 5. Detail Record of Shipboard Maintenance (Deck), proving that Saint Vincent had exercised due diligence to make the ship seaworthy, and make the holds fit for carriage of the cargo; 6. Deck Logbooks (from 15 March to 11 August 2004), proving the water-tight of all the cargo holds and the main course of the voyage; 7. Inspection Reports for Cargo Holds (7 copies), proving that the inspection reports issued by the Ministry of Agriculture of Brazil, Intertek Caleb Brett, Saybolt/Concremat, Control Union World Group, SGS, Schutter do Brasil and BSI respectively all indicated that the cargo holds were fit for carriage of the cargo; 8. Loading Plan, proving that Saint Vinvent had properly and carefully stored the cargo; 9. Statement of Facts at Paranagua (loading), proving the whole process of loading, and that Saint Vincent had properly and carefully loaded the cargo; 10. Sea Protest issued by Master against the loading figures, proving that there was a difference of 322.014tons between the B/L figure and the draft survey figure, and Saint Vincent should not be held liable for the cargo shortage; 11. Fumigation Notice and Fumigation Certificate, proving that according to the Fumigation Notice and the Fumigation Certificate, the vessel could not carry out ventilation within 10 days after the date of fumigation, nor could the bilge be sounded; 12. Temperature and Cargo Ventilation Logbook, proving that the vessel had carried out ventilation according to the dew point during the voyage, and no abnormal change of temperature in the cargo holds had been found, and that Saint Vincent had properly and carefully carried, kept and cared for the cargo; 13. Hold Bilge Sounding Logbook, proving that the bilge of the cargo holds had been kept dry and waterless, and that Saint Vincent had properly and carefully carried, kept and cared for the cargo; 14. Statement of Fact of M/V ?°SEAFARER?± (Discharging) (2 copies), proving the whole process of discharging. Saint Vincent had properly and carefully discharged the cargo. The discharging operations were delayed due to selection of red soya beans, which caused damage to the cargo; 15. Telex sent by the sub-charterer to the Master on 1 March 2004, proving that on 1 March 2004, the sub-charterer Swissmarine Services S.A. of Geneva (?°Swissmarine?±) informed the Master that the vessel had been chartered to Noble Chartering and would be delivered to Noble Chartering when passing Cape Passero; 16. Telex sent by Noble Chartering to the Master on 2 March 2004, proving that Noble Chartering was the voyage charterer under the voyage at dispute, and that on 2 March 2004 Noble Chartering gave voyage instructions to the Master, requesting the vessel to proceed to Parangua for loading soya beans; 17. Telex sent by the Master to Noble Chartering on 3 March 2004, proving that at 1900hrs on 1 March 2004 the vessel was delivered to Noble Chartering when passing Cape Passero; 18. Telex sent by Noble Chartering to the Master on 8 April 2004, proving that Noble Chartering instructed the Master to authorize Noble Grain to issue bills of lading at Singapore; 19. Telex sent by Noble Chartering to the Master on 9 April 2004, proving that on 9 April 2004 Noble Chartering instructed the Master to sail according to the meteorological route provided by Applied Weather Technology Inc.; 20. Letter of Authorization issued by the Master on 11 April 2004, proving that on 11 April 2004, the Master, according to the instruction given by Noble Chartering, authorized the charterer or the charterer??s agent to issue Bs/L on his behalf pursuant to the Charter Party; 21. Telex sent by Noble Chartering to the Master on 27 April 2004, proving that on 27 April 2004, Noble Chartering informed the vessel that the discharging port had been changed from Shanghai Port to Chiwan Port, and  the vessel was instructed to proceed to Singapore for bunkering; 22. Telex sent by Noble Chartering to the Master on 10 May 2004, proving that on 10 May 2004, Noble Chartering against instructed the vessel to proceed to Singapore for bunkering; 23. Telex sent by Noble Chartering to the Master on 10 May 2004, proving that on 10 May 2004, Noble Chartering informed the Master that the surveyor appointed by the charterer would embark the vessel to collect the samples of the cargo when the vessel was bunkering at Singapore; 24. Application for Port Entry of International Sailing Ships, proving that on 8 May 2004, the port entry application filed by M/V ?°SEAFARER?± was approved; 25. Deck Logbook of M/V ?°SEAFARER?± dated 21 May 2004, proving that on 21 May 2004 the surveyor appointed by the charterer had embarked the vessel to collect cargo samples at Singapore; 26. Telexes (2 copies) sent by Noble Chartering to the Master at 0719hrs and 1203hrs respectively on 21 May 2004, proving that on 21 May 2004, Noble Chartering instructed the vessel to drift off Singapore to wait for further voyage instruction; 27. Telex sent by the Master to Noble Chartering on 22 May 2004, proving that as instructed by Noble Chartering, the vessel arrived at Singapore for bunkering and proceeded to the designated area for drifting; 28. Telex sent by Noble Chartering to the Master on 25 May 2004, proving that on 25 May 2004 Noble Chartering instructed the vessel to proceed to the discharging port, namely Chiwan Port; 29. Telex sent by Noble Chartering to the Master on 28 May 2004, proving that on 28 May 2004, Noble Chartering requested the vessel to proceed to Hong Kong OPL, and to wait for further instructions; 30. Telex sent by the Master to Noble Chartering on 29 May 2004, proving that at 1418hrs on 29 May 2004, the vessel arrived at Hong Kong OPL; 31. Telex sent by the Master to the agent of Noble Chartering at the discharging port on 29 May 2004, proving that at 1418hrs on 29 May 2004, the vessel arrived at Hong Kong OPL, and submitted the Notice of Readiness for Discharging; 32. Telex sent by the agent of Noble Chartering in Hong Kong to the Master on 30 May 2004, proving that on 30 May 2004, the agent of Noble Chartering requested the vessel to keep waiting for instructions from Noble Chartering; 33. Telex sent by the Master to Noble Chartering on 31 May 2004, proving that on 31 May 2004, the Master requested Noble Chartering to inform him of the intention/reason for the vessel??s anchoring at Hong Kong OPL and how long the vessel had to stay there; 34. Telex sent by the Master to Noble Chartering on 1 June 2004, proving that on 1 June 2006, the Master requested Noble Chartering to inform him of the intention/reason for the vessel??s anchoring at Hong Kong OPL and how long the vessel had to stay there, and that the Master requested Noble Chartering to arrange the berth as soon as possible, since the vessel would be delivered and crewmembers would be changed after discharging the cargo at Chiwan Port; 35. Application Form of Entry Quarantine, proving that on 1 June 2004, the application for entry quarantine for M/V ?°SEAFARER?± was approved; 36. Telex sent by Noble Chartering to the Master at 0156hrs on 2 June 2004, proving that at 0156hrs on 2 June 2004, Noble Chartering informed the Master that they were still waiting for the instructions of the cargo charterer; 37. Telex sent by Noble Chartering to the Master at 0323hrs on 2 June 2004, proving that at 0323hrs on 2 June 2004, Noble Chartering informed the Master again that before the cargo charterer solved its problems, the vessel must keep waiting at Hong Kong OPL; 38. Telex sent by Noble Chartering to the Master on 14 June 2004, together with Evidence No.24 & 35, proving that on 14 June 2004, the charterer did not obtained the import license for the cargo. Since the charterer did not obtain the import license, Noble Chartering could not give voyage instructions to the vessel; 39. Telex sent by the Master to Noble Chartering on 17 June 2004, proving that on 17 June 2004, the Master requested Noble Chartering to provide the intention and schedule of berthing; 40. Telex sent by the Master to Noble Chartering on 21 June 2004, proving that on 21 June 2004, the Master again requested Noble Chartering to provide the intention and schedule of berthing; 41. Telex sent by Noble Chartering to the Master on 25 June 2004, proving that on 25 June 2004, the charter solved its problems, and the vessel could follow the instructions from the agent of Noble Chartering; 42. Telex sent by the agent of Noble Chartering to the Master on 25 June 2004, proving that on 25 June 2004, the agent of Noble Chartering instructed the vessel to proceed to the southeast of Lamma Anchorage, Hong Kong; 43. Telex sent by the Master to Noble Chartering on 26 June 2004, proving that at 1543hrs on 26 June 2004, the vessel arrived at the southeast of Lamma Anchorage; 44. Telex sent by Noble Chartering to the Master on 29 June 2004, proving that on 29 June 2004, Noble Chartering instructed the Master to tender to the agent the NOR according to the time when the vessel anchored at the southeast of Lamma Anchorage; 45. Notice of Readiness, proving that on 21 July 2004, the Master, as instructed, tendered the NOR, stating that M/V ?°SEAFARER?± arrived at SE Lamma on 26 June, and was ready for discharging; 46. Telex sent by the agent of Noble Chartering to the Master on 1 July 2004, proving that on 1 July 2004, the agent of Noble Chartering, namely SUNISCO, instructed the vessel to proceed to Urmston Road Anchorage for CIQ inspection and quarantine as well as sampling; 47. Deck Logbook of M.V. ?°SEAFARER?± dated 2 July 2004, proving that on 2 July 2004 CIQ inspected, quarantined and sampled the cargo at Urmston Road Anchorage; 48. Summary of Meeting held among four parties concerning the discharging of cargo carried by M/V ?°SEAFARER?±, proving that on 9 July 2004, the Plaintiff reached an agreement with Noble Grain and Chiwan Shipping Foodstuff Wharf Co., Ltd. on the discharging of soya beans and the pick-up of soya beans treated with seed coated agent; 49. Agreement on Entry for Berth & Pick-up of Soya Beans of M/V ?°SEAFARER?±, proving that on 19 July 2004, Noble Grain and Chiwan Wharf Limited reached an agreement on Entry for Berth & Pick-up of Soya Beans; 50. Telex sent by the agent of Noble Chartering to the Master on 20 July 2004, proving that the agent of Noble Chartering, namely SUNISCO, did not instruct the vessel to berth at Chiwan Port until 20 July 2004; 51. Sea Protest submitted by the Master on 21 July 2004, proving that the Master declared that the vessel encountered a bad weather when sailing according to the meteorological route as instructed by Applied Weather Technology Inc., and the Master noted his protest against the damage to the cargo caused by the bad weather; 64. Letter of Protest sent by the Master to Noble Chartering and the relevant parities on 22 July 2004, proving that the Master declared the vessel and the owner were not liable for any cargo loss; 53. Statement of Master of M/V ?°SEAFARER?±, proving the whole course of the voyage at issue and the relevant facts. The Owner had exercised due diligence to load, transfer, stow, carry, take care, and discharge the cargo; 54. Statement of Chief Officer of M/V ?°SEAFARER?±, proving the whole course of the voyage at issue and the relevant facts. The owner had exercised due diligence to load, transfer, stow, carry, take care, and discharge the cargo; 55. Statement of Facts of Chief Engineer, proving that during the voyage, bunkers were not heated whenever the vessel received bunkers or bunkers were transferred; 56. Inspection Report issued by Guangzhou Balance Cargo Control & Survey Ltd., proving that the total loss of soya beans was in the amount of US$37056.90, and the direct causes of such damage were the inherent defect of the cargo and that part of the cargo had been wetted before loading. The prolonged voyage and discharging were the external conditions for the damage to soya beans, which accelerated the mould/caking/discoloration of soya beans. The mildew damage to soya beans under both ends of the central joint of two hatches of each cargo hold was probably caused by the water ingress under the bad weather, and such loss incurred was obvious and limited. Evidence No.56 also proved the facts relating to the quarantine and discharging of soya beans at Chiwan Port; 57. Survey Report on M/V ?°SEAFARER?± Voyage No.30 issued by Shanghai Double Hope Insurance Surveyors & Adjusters Co. Ltd.(?°Double Hope?±), proving that Saint Vincent had exercised due diligence to make the vessel seaworthy, cargo-worthy before and at the beginning of the voyage. Saint Vincent had exercised due diligence to load, take care of the cargo with proper ventilation. The cargo became wet due to the bad weather, but such wetted cargo were very limited and partial. The pick-up of ?°red soya beans?± delayed the discharging operations, and aggravated the damages. The caked soya beans contained a high proportion of residual impurities and foreign substances; 58. Inspection Report issued by CWA International Ltd. on Heat Damage to Brazilian Soyabeans carried onboard M/V ?°SEAFARER?±, proving that deterioration of soyabeans mainly resulted from the prolonged voyage and the delay in discharging. The cargo holds were fit for carriage of the cargo, and the vessel had carried out proper ventilation. Soyabeans at the time of loading were not of good quality. The cargo got wet because of the bad weather, but such damage was limited to a small area and the wet-damaged beans were discharged separately. ?°Red beans?± were found during discharging operations, which further delayed the discharging operations and aggravated the damage; 59. Reports (2 copies) issued by the Price Certification Center of Guangdong Provincial Price Bureau, proving the market price of Brazilian soyabeans in Shenzhen from February to December 2004; 60. Analysis on Route of M/V ?°SEAFARER?± from Paranagua, Brazil to Chiwan, China issued by Professor Wang Jianping from the Navigation College of Dalian Maritime University, proving that the route involved in the case was geographically direct and customary, economic and safe, without any deviation; 61. Letter of Re-declaration on Regulations of Management on Quarantine Licenses for Imported Plants and Animals, proving that on 28 May 2003, AQSIQ re-declared that import units should fulfill formalities for approval of quarantine and obtain Quarantine Licenses for Imported Plants and Animals before signing a sales contract; 62. Letter of Re-declaration on Regulations of Management on Quarantine Licenses for Imported Plants and Animals, proving that on 31 July 2003, AQSIQ declared again that the import units should fulfill formalities for approval of quarantine and obtain Quarantine Licenses for Imported Plants and Animals before signing a sales contract; 63. Warning Circular Regarding Brazilian Soya Beans mixed with Soya Beans treated with Seed Coated Agent (GZJDH [2004] No. 332), proving that Brazilian soya beans exported to China by Noble Grain were mixed with soya beans treated with seed coated agent; since 10 May 2004, Noble Grain had been suspended to export Brazilian soya beans to China; with respect to soya beans shipped en route, those in compliance with the requirements of inspection and quarantine for entry could be allowed to enter into China; 64. Announcement No.73 Issued by AQSIQ, proving that on 16 June 2004, AQSIQ notified that import units or agents should handle formalities of approval according to the relevant provisions for the approval on quarantine of imported plants and animals before signing a sales contract; 65. Announcement No.76 Issued by the AQSIQ, proving that on 23 June 2004, the AQSIQ resumed Noble Grain??s qualification of exporting Brazilian soya beans to China. With respect to those soybeans shipped en route before 11th June 2004, if soya beans were mixed with soybeans treated with seed coating agent, soya beans treated with seed coated agent should be picked up and disposed of before discharging. Soya beans would not be allowed to enter into China until they were found in compliance with the relevant requirements of China; 66. Notice of Inspection and Quarantine Treatment, proving that on 6 July 2004, Shekou CIQ issued a notice of inspection and quarantine treatment for soya beans at issue; soya beans were mixed with soya beans treated with seed coated agent; soya beans violated laws and regulations, and should be picked out before discharging, and the Brazilian soya beans could be allowed to enter into China after requirements of entry inspection and quarantine were met; 67. Document (She Jian Ban [2004] No.62) issued by Shekou CIQ, proving that on 16 July 2004, Shekou CIQ requested that soya beans treated with seed coated agent should be picked out before discharging, and the Brazilian soya beans could be allowed to enter into China after requirements of entry inspection and quarantine were met. Since soya beans treated with seed coated agent were required to be picked out, the period of discharging would prolong to around 29 days, much longer than the normal discharging period(around one week); 68. Judgment of the ?°Hellenic Dolphin?± case, proving that under the English laws, the owner may defend herself against the cargo damage based on the exemptions; 69. Judgment of the ?°Mata K?± case, proving that under the English laws, the Clause of ?°Unknown?± under the bill of lading shall be recognized; 70. Judgment of the ?°Atlas?± case, proving that under the English laws, the Clause of ?°Unknown?± under the bill of lading shall be recognized; 71. Judgment of the ?°Giannis NK?± case, proving that under the English laws, ?°red soya beans?± were prohibited from import into China, as a result of which, the vessel and the cargo were delayed, and the ?°red soya beans?± constituted dangerous cargo. It is absolute that the shipper should be held liable for the dangerous cargo. In any event should the shipper be liable for the demurrage of the vessel caused by such dangerous cargo; 72. Legal Opinion issued by the UK-based law firm Clyde & Co., demonstrating that English law and Hague Rules shall apply to the present case. The relevant voyage instructions given by Noble Chartering to the Master shall be deemed as the voyage instructions given by Noble Chartering on behalf of or as the agent of Noble Grain. The stopover of the vessel during the voyage did not violate the bills of lading. The owner was entitled to defend by invoking the arguments of ?°quarantine restrictions?±, ?°the act of the shipper and the owner of the cargo?±, ?°the nature and the inherent defect of the cargo?±, and any other causes arising without the actual fault or privity of the carrier. The Owner shall not be held liable for the loss arising from the differences of market prices of soya bean meals and salad oil; 73. Websites of Noble Group, Noble Chartering, Noble Grain and Noble Europe, proving that Noble Chartering, Noble Europe and Europe Grain are subsidiaries of Noble Group, and their respective business scope were the specialized divisions of the business within Noble Group, so they should be deemed as a whole or mutual representatives or agents; 74. Opinions on Oil production rate and Processing Costs of Soya beans Carried onboard M/V ?°SEAFARER?± issued by the Cereals Quality Supervision and Test Center, Ministry of Agriculture of P. R. China (?°CQSTC?±), proving that oil production rate of 17.64% as alleged by the Plaintiff was wrong. The actual oil production rate of the soya beans carried onboard M/V ?°SEAFARER?± should be 18.99%. The actual oil production (rate) of the soya beans carried by M/V ?°SEAFARER?± was within the normal range. It was improper for the Plaintiff to calculate the processing costs of soya beans carried onboard M/V ?°SEAFARER?± by taking reference to the processing costs of Brazilian soya beans in 2002. The production economic technical indexes of Brazilian soya beans in 2004 were normal and the production costs did not increase; 75. Statistical Figures provided by National Grain & Oils Information Center of P. R. China, proving that the prices at Huangpu port cited from http://fao.com.cn by the Plaintiff were not qualified and accurate. From 4 June 2004 to 4 July 2004, the average market prices of soya bean meals and salad oil in Shantou were RMB2,832.38/ton and RMB6,347.62/ton respectively; 76. Industry & Commercial Registration Information of Shantou Zhongxing, proving that in 2006, Shantou Zhongxing did not complete annual inspection; 77. Supplementary Report to the Inspection Report on Soya beans Carried by M/V ?°SEAFARE?± issued by Guangzhou Balance Cargo Control & Survey Ltd., proving that after the berth of M/V ?°SEAFARER?±, no sorghum halepense and sorghum almum parodi, or their grass seeds had been found on the surface of the cargo. During the whole discharging process, no sorghum halepense and sorghum almum parody had been found mixed with the cargo. Shekou CIQ requested to carry out inspection and quarantine treatment and supervision on red soya beans, rather than on sorghum halepense and sorghum almum parodi; 78. Supplementary Expert??s Opinion on Soyabean Cargo Carried by M/V ?°Seafarer?± issued by the Cereals Quality Supervision and Test Center, Ministry of Agriculture of P. R. China (CQSTC), proving that the purpose to conduct inspection and quarantine on sorghum halepense and sorghum almum parodi was to prevent them from spreading and dispersing so as to ensure the safety of the agriculture and the animal husbandry of China. It was not because that they might affect the quality and the production costs of soya beans. A small amount of sorghum halepense and sorghum almum parody mixed into the soya beans would not affect the quality of the extracted oil and the costs. No sorghum halepense and sorghum almum parody were found during the process of inspecting the samples of soya beans. The relationship between free fatty acid and acid value was not always invariable, and the processing of soya beans was closely related to the raw materials, techniques, auxiliary materials and equipment. The content of free fatty acid contained by different soya beans varied.


The Defendants, Noble Europe, Noble Grain, and Noble Chartering (?°Three Noble Companies?±), defended as follows: 1. In accordance with Article 145 of the General Principles of the Civil Law of the People??s Republic of China, and Article 269 of the Maritime Code of the People??s Republic of China, the parties to a contract involving foreign elements may choose the law applicable to the settlement of their contractual disputes. The bills of lading involved in the case specifically stated that ?°All the terms and conditions, liabilities and exceptions of the Charter Party, including the law and arbitration clause, as prescribed on the obverse side of the B/L, are herewith incorporated into the B/L?±. Meanwhile, under English law, the validity of the terms and conditions contained in the B/L is recognized. English laws shall apply to the present case; 2. None of the Three Noble Companies was the carrier. Three Noble Companies are independent legal persons reregistered in difference countries. Noble Grain was the shipper stated in the bills of lading. It was Noble Chartering Inc. that concluded the Charter Party with Noble Grain. Noble Chartering Inc. chartered M/V ?°SEAFARER?± and then sublet the vessel to Noble Grain. Noble Chartering Limited was the agent of Noble Chartering Inc., in charge of giving voyage instructions on the operations of the vessel. Noble Europe was mistakenly written into the Charter Party, and in fact Noble Europe was irrelevant to the present case; 3. The Plaintiff was not entitled to bring a lawsuit, as they were merely the import agent of Shantou Zhongxing, and the losses arising therefrom were sustained by Shantou Zhongxing. Therefore the Plaintiff did not have direct interests with the present case, and was not qualified to be the Plaintiff of this case; 4. The Plaintiff??s assertions of delay in delivery and unreasonable deviation were not tenable. The bills of lading did not specify the time for cargo delivery, and thus the late arrival of the vessel at the discharging port could not constitute a delay in cargo delivery. M/V ?°SEAFARER?± stay at the anchorages of Singapore and Hong Kong was due to the requirements of quarantine. The passage route of the vessel was geographical customary and no unreasonable deviation existed in the case; 5. Three Noble Companies should not be held liable for the loss of or damage to the cargo alleged by the Plaintiff. The carrier shall not be held liable for the cargo loss or cargo damage as alleged by the Plaintiff. On 10 May 2004, AQSIQ issued an announcement to prohibit the suppliers, including the shipper Noble Grain, from importing soya beans from Brazil to China. The Plaintiff and Shantou Zhongxing informed Noble Grain that they could not continue to perform the sales contracts, and requested Noble Grain to extend the payment of the L/C. The Plaintiff did not provide the import permit license to Noble Grain until 17 June. Noble Grain submitted the documentations specified in the L/C relating to 20,000tons of the cargo on 8 May, but the Plaintiff and Shantou Zhongxing requested the opening bank not to effect the payment on the ground that the said documentations submitted by Noble Grain were not in compliance with the requirements of the L/C. As a result, Noble Grain had to instruct, through Noble Chartering Inc., the vessel to stay at Hong Kong and Singapore, to wait for the Plaintiff to handle the import procedures and for the competent authority to approve the cargo carried onboard M/V ?°SEAFARER?± to enter into China. M/V ?°SEAFARER?±??s stopover at Singapore and Hong Kong was caused by the quarantine restriction and the failure of the Plaintiff in acquiring the import permit license. Therefore the carrier shall not be held liable; 6. A small amount of the cargo became mildewed due to the bad weather during the voyage, and the carrier shall not be held liable. 100tons of the cargo were short-landed, which was within the scope of trade allowance at 0.5% . Therefore, the carrier shall not be held liable; 7. The Plaintiff did not suffer from any actual loss, and the losses claimed by the Plaintiff were actually sustained by Shantou Zhongxing. In accordance with the Maritime Code of the People??s Republic of China, the liquidated damages and the losses arising from reduction of production, depreciation and expenses should be borne by the carrier, and the aforesaid losses were irrelevant to the case. 


Three Noble Companies submitted the following evidence to support their defence: 1. Legal Opinions (2 copies) issued by the British attorneys, proving that English laws shall apply to the case. Under the English laws, the Plaintiff did not have standing to bring suit, and none of the Three Noble Companies was the carrier; 2. TCT Charter Party dated 1 March 2004, Voyage Charter Party dated 1 March 2004, Invoices of freight, proving that Noble Chartering Inc. chartered M/V ?°SEAFARER?± from Swissmarine Services S.A. of Geneva on a TCT basis for a voyage of carrying cargo from South America to Far East, and then Noble Chartering Inc. sublet the vessel to Noble Grain on a voyage basis for carrying the cargo involved in this case and charged Noble Grain the freight under the Voyage C/P; 3. Letter of Authorization issued by the Master of  M/V ?°SEAFARER?±, proving that Master of M/V ?°SEAFARER?± authorized the charterer to issue on his behalf the bills of lading with respect to the voyage involved in this case; 4. Correspondences among the Plaintiff, Shantou Zhongxing and Noble Grain relating to the conclusion of the sales contracts for the cargo involved in this case: Confirmation of Trade, Sales Contract, Confirmation Letter relating to Shantou Zhongxing??s authorization to the Plaintiff for importing cargo on its behalf, proving that as entrusted by Shantou Zhongxing, the Plaintiff concluded the sales contract with Noble Grain for importing the cargo involved in this case. The consignee of the cargo at issue was Shantou Zhongxing, and the Plaintiff was not entitled to bring this suit; 5. Warning Circular  in respect of the imported Brazilian soya beans treated with seed coated agent issued by AQSIQ on 10 May 2004, Letters sent by the Plaintiff and Shantou Zhongxing to Noble Grain in respect of quarantine restrictions, Announcement issued by AQSIQ on 23 June 2004 for releasing the quarantine restrictions, proving that due to quarantine restrictions and the failure of the consignee in completing the import procedures, M/V ?°SEAFARER?± could not proceed to the port of discharging; 6. Letters among Noble Grain, the Plaintiff, Shanzhou Zhongxing and Banks regarding the L/C payment: Letter sent by Noble Grain to the Plainitff for urging the Plaintiff to pay the L/C, Letters between Noble Grain and the opening bank, Bank of China, Letters written by the opening bank as forwarded by Standard Chartered Bank, proving that during the period of quarantine restrictions, the Plaintiff refused to effect the payment of the cargo under the L/C; 7. Certificates issued at the port of loading, Certificate of Quality, Certificate of Origin, Phytosanitary Certificate, Chemical Residues Certificate, Non-wooden Packing Certificate, Inspection Certificate for Cargo Holds before loading, Notification of Inspection and Quarantine Treatment, proving that a small quantity of ?°red soya beans?± found during the discharging operations resulted from the inherent defect of the cargo, and such finding finally resulted in the delay of discharge; 8. Statement of Situations, proving that Noble Chartering was the agent of Noble Chartering Inc.. Noble Europe was not engaged in the carriage of the cargo at issue; Noble Europe was mistakenly written as the Owner of M/V ?°SEAFARER?± in the Charter Party; 9. Analysis Report on the route of M/V ?°SEAFARER?±, proving that the route of this voyage of M/V ?°SEFARER?± was a geographically direct and customary route, without any unreasonable deviation; 10. ASQIQ Announcement (2004) No.58, ASQIQ Announcement (2004) No.61, and ASQIQ Announcement (2004) No.71, proving that after issuing the Warning Circular on 10 May 2004 which prohibited three suppliers including Noble Grain from exporting Brazil soya beans to China, the ASQIQ issued the Announcement No.58, No.61 and No.71, extending the number of the suppliers who were suspended from exporting Brazil soya beans to China to 23. Due to the quarantine restrictions, the vessel and the cargo at issue were prohibited from entering into China; 11. ASQIQ Announcement (2004) No.73, proving that after announcing the quarantine restrictions, the ASQIQ issued the Announcement No.73 on 16 June 2004, restating and emphasizing that the necessary procedures for examination and approval of animals and plants quarantine shall be handled in accordance with the relevant laws and regulations. The Quarantine Permit for the Entry Animals and Plants was necessary when handling the inspection and quarantine procedure and the import procedure. The imported GMO products shall be equipped with the Examination and Approval Document for Identification of Agricultural GMO. Due to the quarantine restrictions, the vessel and the cargo at issue were prohibited from entering into China; 12. Letters sent by the Plaintiff and Shantou Zhongxing to Noble Grain on 15, 17 19 and 28 May 2004, proving that since the cargo at issue were prohibited from entering into China due to quarantine restrictions, Shantou Zhongxing refused to pay for the cargo covered the L/C. The Plaintiff and Shantou Zhongxing did not require Noble Grain to obtain the GMO Certificate until the ASQIQ issued the ?°Warning Circular ?± relating to the quarantine restrictions, but it was impossible for Noble Grain to apply for the GMO Certificate due to such quarantine restrictions; 13. Quarantine Permit for Entry Animals and Plants relating to other two consignments of soya beans carried onboard M/V ?°SEAFARER?±, proving that the Permit should specify the date of issuance. The Permit became effective on the date of the vessel??s entry, but it is possible that the Permit was issued after the vessel had entered into China; 14. Letter concerning refusal to pay for the L/C sent by the Plaintiff to the Bank of China, Henan Branch on 26 May 2004, and Notice of Payment /Non-payment sent by the Plaintiff to the Bank of China, Henan Branch on 14 June 2004, proving that during the period of quarantine restrictions, the Plaintiff claimed a discrepancy in the documents and instructed the opening bank to refuse to effect the payment. The Plaintiff did not agree to make the payment until 14 June 2004; 15. Notice for Payment against Documents specified under L/C issued by the Bank of Communications, Zhengzhou Branch, and Letters of the Bank of Communications, Zhengzhou Branch in respect of the payment against documents under the L/C covering the cargo at issue, proving that the opening bank of the Plaintiff, namely the Bank of Communications, Zhengzhou Branch, received the documents specified in the L/C on 8 May, and received the modified documents on 21 May. Although the Bank of Communications, Zhengzhou Branch received inquires from Noble Grain for many times, it still refused to accept the documents. The Plaintiff did not instruct the Bank of Communications, Zhengzhou Branch to accept the L/C until 23 June 2004; 16. Civil Judgment numbered (2005) GHFCZ No.211 rendered by Guangzhou Maritime Court, proving that the following information concerning the carriage of M/V ?°Oriental Queen?± was collected: from 16 April to 21 April, M/V ?°Oriental Queen?± was loaded with the Brazilian soya beans; the water content of the soya bean was 12.7% at the time of loading, which was higher than the water content (12.57%) of soya beans carried by M/V ?°SEAFARER?±; M/V ?°Oriental Queen?± arrived at Zhanjiang on 16 August, began discharging on 18 August, and completed discharging on 30 August; after a long carriage period (namely 119 days), the cargo did not suffer from any obvious damage. The aforesaid facts proved that the water content of soya beans would not cause any effect on the safe carriage of the cargo. No casual relationship existed between the long carriage period and the cargo damage; 17. Certificate of Incorporation, proving that Noble Chartering Inc. and Noble Europe were independent legal persons registered in different countries; 18. Guide to Port Entry, proving that LAMMA Anchorage was the waiting anchorage for M/V?°SEAFARER?± to wait for entering Chiwan Port, and M/V?°SEAFARER?±?? stay at LAMMA Anchorage waiting for entry shall be regarded as normal sailing; 19. Letter of Authorization, proving that Noble Chartering was the agent of Noble Chartering Inc.; 20. Legal Opinions presented by Holman Fenwick & Willan, proving that under the English laws, the seller who fails to obtain the payment for cargo shall be entitled to dispose of the cargo, and if the buyer refuses to pay for the cargo, the seller shall be entitled to take the cargo and refuse to deliver the cargo to the buyer; 21. Letter written by Sunning Shipping Ltd., proving that LAMMA Anchorage in Hong Kong was the waiting anchorage for the bulk carriers to proceed to Shekou, Chiwan, and Mawan; 22. the Import Permit for Cargo at issue faxed by the Plaintiff to Noble Grain on 17 June 2004, proving that the Plaintiff did not provide the import permit to Noble Grain until 17 June 2004; 23. Statement made by Li Yijuan from ASQIQ, and Notice on Failure to Obtain Approval on Application of the Permit, proving that in April 2004, soya beans treated with seed coated agent were found in the imported soya beans in Xiamen, and from 30 April the ASQIQ suspended giving import permits of Brazilian Soya beans to four suppliers, including Noble Grain; 24. Opinions presented by Holman Fenwick & Willan, proving that under the English laws, if the consignee does not instruct the vessel to proceed to the discharging anchorage after the vessel submits the NOR, then the consignee is not entitled to claim any compensation against the carrier for the loss arising therefrom; 25. Civil Judgment numbered (2003) GHFCZ No.257 rendered by Guangzhou Maritime Court, proving that if the bill of lading issued on behalf of the Master did not specify the carrier, the registered owner shall be deemed as the carrier; 26. Meeting Summary between Chinese government and Brazilian government, proving that on 21 June 2004, Chinese government and Brazilian government carried out negotiation on the issue that soya beans exported from Brazil into China were found mixed with red soya beans.


On 9 August 2004, the Plaintiff filed an application to the Court, requesting for pretrial evidence preservation of the logbooks of M/V ?°SEAFARER?± from 15 April to 30 June 2004. On 10 August, the Courter rendered the Civil Ruling numbered (2004) GHFBZ No.41-2, granting permission on such application. The Plaintiff paid to the Court the application fee in the amount of RMB5,000 and the enforcement fee in the amount of RMB20,000. On the same day, the Court copied the logbooks of M/V ?°SEAFARER?± from 15 April to 30 June 2004.


On 1 June 2006, Saint Vincent filed an application to the Court, requesting the Court to collect evidence from Shekou CIQ, the ASQIQ, and the Technology Education Department of the Ministry of Agriculture, which was permitted by the Court. Saint Vincent paid to the Court the evidence collection fee in the amount of RMB15,000. The Court collected the following evidential materials: 1. Quarantine Permit for the Entry Animals and Plants No.PB00041315; 2. Application Form of Quarantine Permit for the Entry Animals and Plants; 3. Agricultural GMO Safety Certificate (Import) (NJAJZ(2004)No.0907); 4. Examination and Approval Document for Identification of Agricultural GMO (NJBJZ(2004) No.0777); 5. Notice of Inspection and Quarantine Treatment No.470100104024804; 6. Application for Inspection of Entry Cargo No.470100104024804; 7. Letter of Authorization for Inspection Application; 8. Investigation Record dated 29 June 2006 of Lian Qing from the Agricultural GMO Safety Management Office of the Ministry of Agriculture.


On 22 August 2006, Saint Vincent filed an application to the Court, requesting the Court to collect evidence from Chiwan Wharf Limited, and China International Economic and Trade Arbitration Commission, which was permitted by the Court. Saint Vincent paid to the Court the evidence collection fee in the amount of RMB25,000. The Court collected the following evidential materials: 1. Agreement on the Pick up of Soya beans after M/V ?°SEAFARER?±??s Entry into Port for Berth; 2. Warehouse Storage Fee for M/V ?°SEAFARER?± (04V02269, Shantou Zhongxing); 3. Delivery Order; 4. Statement made by Shenzhen Chiwan Wharf Holdings Limited; 5. Letter of Reply numbered (2006)ZGMZJZ No.008558 issued by the CIETAC.


On 23 November 2006, Three Noble Companies filed an application to the Court, requesting the Court to collect evidence from the Bank of China, Zhengzhou Branch, the Bank of Communications, Zhengzhou Branch, the Yellow River Notary Office of Henan Province, which was permitted by the Court. Three Noble Companies paid to the Court the evidence collection fee in the amount of RMB20,000. The Court collected the following evidential materials from the Yellow River Notary Office of Henan Province: 1. Enforceable Notarial Certificate of Creditor??s Right numbered (2006)YZJZ No.10; 2. Repayment Agreement No.25COFIE0042; 3. Agency Agreement for Import of Soya beans No.24COFIE0011; 4. Supplementary Agreement No.24COFIE0038; 5. Supplementary Agreement No.24COFIE0071; 6. Supplementary Agreement No.24COFIE0027; 7. Mortgage Contract No.25COFIE0029; 8. Supplementary Agreement No.25COFIE0043. The Court collected the following evidential materials from the Bank of China, Zhengzhou Branch: 1. Application for Irrevocable Letter of Credit No.LC5300122/04; 2. Examination and Approval Document for Identification of Agricultural GMO (NJBJZ(2004) No.0777); 3. Agricultural GMO Safety Certificate (Import) (NJAJZ(2004)No.0074); 4. Sales Contract No.NC070316-B; 5. Correspondences between the Bank of China, Zhengzhou Branch and the Plaintiff: Notice on Discrepancy of L/C, Notice of Modification to L/C, and Notice on Acceptance/refusal of L/C etc. The Court collected the following evidential materials from the Bank of Communications, Zhengzhou Branch??1. Agency Agreement for Import of Soya beans No.24COFIE0011; 2. Sales Contract No.NC070316-B; 3. Notice dated 31 March 2004 sent by the Plaintiff to Noble Grain; 4. Materials relating to Application of the Plaintiff for Establishment of L/C; 5. Notice on Payment against Documents specified under L/C; 6. L/C for Importation, Payment Collection/Acceptance Form; 7. Correspondences between the Bank of China, Zhengzhou Branch and the Plaintiff; 8. Commercial Invoice No.N327/04; 9. Bills of Lading; 10. Non-wooden Packing Certificate, Fumigation Certificate, Sanitary Certificate, Weight Certificate, Quality Certificate, Certificate of Origin, Certificate of Chemical Residues, Cargo Hold Inspection Certificate as issued by SGS; 11. Notice of Shipment.


The Court, according to the application filed by Saint Vincent, notified the following persons to appear in court to accept cross-examination: Professor Wang Jianping, from the Navigation College of Dalian Maritime University; Researcher Wang Bujun, from the Cereals Quality Supervision and Test Center, Ministry of Agriculture of P. R. China; Attorney Derek Hodgson, from Clyde & Co. Law Firm; Adjuster Lin Wenkai, from Guangzhou Balance Cargo Control & Survey Ltd. The Court, according to the application filed by Three Noble Companies, notified the following persons to appear in court to accept cross-examination: Mr. Benjamin John Wilkes from Noble Grain, and Attorney Henry Dunlop, from Holman Fenwick & Willan, Hong Kong Office.


The following facts are ascertained by the Court through trial:


I.	Facts relating to the Sale and Payment of the Cargo


On 25 February 2004, Noble Grain (as the Seller) concluded the Sales Contract No.NC070316 with Shantou Zhongxing (as the Buyer), agreeing that: the Buyer would purchase 55,000tons of South American soya beans from the Seller (??10%, at Seller??s option), with the payment terms of Letter of Credit; The date of Shipment would be from 1 April 2004 to 25 April 2004; the price was 162 cent/Bushel + Contract Price of Soya beans dated May 2004 at Chicago Board of Trade; the port of destination was Chiwan, Guangdong, P. R. China. On 5 March, Shantou Zhongxing notified Noble Grain that Shantou Zhongxing entrusted the Plaintiff to import 55,000tons of South American soya beans (??10%) under the Sales Contract No.NC070316. On 25 March, the Plaintiff and Noble Grain concluded two Sales Contracts No.NC070316-B and NC070586. The quantity of the cargo under the Sales Contract No.NC070316-B was 35,000tons, and the quantity of the cargo under the Sales Contract No.NC070586 was 20,000tons. The other terms and conditions of these two contracts were the same. On 31 March, the Plaintiff notified Shantou Zhongxing that the Sales Contract No.NC070316 had been separated into two Sales Contracts No.NC070316-B and No.NC070586, in which, it was agreed as follows: the maximum moisture content of soya beans was 14%; the maximum heat damaged kernels was 5%; the basic content of foreign materials was 1%, at the maximum of 2%; the content of split kernels was 20%, at the maximum of 25%; the basic content of other-color kernels was 2%, at the maximum of 5%; the oil content was 18.5% basically; the protein content was 34% basically, at the minimum of 33.5%.


On 31 March 2004, the Plaintiff opened with the Bank of China, Henan Branch an irrevocable letter of credit No.LC5300122/04 in the amount of US$15,638,000 for 35,000tons of South American soya beans. On 27 April, the Plaintiff notified the bank to modify the unit price of the cargo covered by the aforesaid L/C to US$406.16/ton, and the amount of the payment for the said cargo to US$14,215,600. On 12 May, the Plaintiff notified the Bank of China, Henan Branch to modify the unit price of the cargo covered by the aforesaid L/C to US$402.94/ton, and the amount of the payment for the said cargo to US$14,102,900. On 14 June, the Plaintiff sent an Acceptance Notice to the Bank of China, Henan Branch, agreeing to effect the payment in the amount of USD15,201,207.26 for the cargo covered by the aforesaid L/C. On 18 June, the Bank of China, Henan Branch effected the payment specified under the said L/C.


On 31 March 2004, the Plaintiff opened an usance letter of credit No.LCZP808200410048 in the amount of UD$9,011,200 for 20,000tons (??10%) of South American soya beans with the Bank of Communications, Zhengzhou Branch. On 18 June, the Bank of Communications, Zhengzhou Branch, notified the negotiating bank (namely Soctete General Bank, Singapore Branch) to effect the payment for the cargo at issue. On 31 June, the Plaintiff sent a Notice for Payment against Documents specified under L/C to the Bank of Communications, Zhengzhou Branch, agreeing to accept the L/C and effect the payment for 22,000tons of soya beans covered by the aforesaid L/C, in the amount of USD9,912,320.


On 29 April, Noble Grain issued two commercial invoices to the Plaintiff, specifying that: the total price of 22,000tons of soya beans under the Sales Contract No.NC070586 was US$9,912,320, and the unit price thereof was US$450.56/ton, CFRFO Chiwan China; the total price of 37,725.734tons of soya beans under the Sales Contract No.NC070316-B was US$15,201,207.26, and the unit price was US$402.94/ton, CFRFO Chiwan China.


II.	Facts relating to the Chartering of M/V ?°SEAFARER?±


M/V ?°SEAFARER?± was a bulk carrier with steel hull. The vessel was of 38,818 gross tonnage, 25,182 net tonnage. The flag state of M/V ?°SEAFARER?± was Philippines, and the port of registry was Manila. The vessel was owned by Saint Vincent.


On 1 March 2004, Swissmarine Services S.A. of Geneva, as the disponent owner of M/V ?°SEAFARER?± entered into a time charter party with the charterer Noble Chartering Inc. in London, agreeing that Swissmarine would let M/V ?°SEAFARER?± to Noble Chartering Inc. at the rate of USD49,000/day, and the period would be one voyage.


On the same day, Noble Europe, as the owner of M/V?°SEAFARER?± entered into a voyage charter party with the charterer Noble Grain, in which it was agreed that: vessel: M/V ?°SEAFARER?±; expected ready to load on or about 16 March 2004; loading port(s): 1 safe port of Brazil; discharging port(s): 1/2 safe berth 1 safe port in PRC, intention Chiwan; demurrage: at the rate of USD35,000 per day; the Master was to sign Bills of Lading as presented; Bills of Lading would show the name of the carrier and would be signed either by the Master or by a named agent for or on behalf of the Master, in which case the said agent shall indicate his own name and the name of the Master when signing the Bills of Lading; if the Master delegated the signing of the Bills of Lading to an agent, he shall give him authority to do so in writing, copy of which is to be furnished to Charterers; Charter Party shall be covered by English laws.


The Plaintiff contended during the trial that Shantou Zhongxing obtained the said voyage charter party from Noble Grain for the purpose of settling the demurrage at the discharging port. The owner of M/V ?°SEAFARER?± specified in such voyage charterer party was Noble Europe.


Three Noble Companies alleged as follows: it was Noble Chartering Inc., rather than Noble Europe, that concluded the voyage charter party with Noble Grain on 1 March 2004. Noble Europe was mistakenly written as the owner of M/V ?°SEAFARER?± under the said voyage charter party. Three Noble Companies submitted to the Court the affidavit made by Benjam John Wilkes, the manager of the ship??s chartering department of Noble Resources Pte. Ltd. Benjam John Wilkes also appeared in court to testify, stating as follows: Noble Chartering Limited was the agent of Noble Chartering Inc., while Noble Chartering Inc. was the time charterer and responsible for ship??s chartering under Noble Group; Noble Grain was the voyage charterer; it was common for Noble Europe to be mistakenly written as another company under Noble Group. The Plaintiff contended during the evidence examination that the owner specified in the voyage charter party provided by Noble Grain to the Plaintiff was Noble Europe, rather than Noble Chartering Inc. Noble Europe being written as the owner was a special arrangement for a special trade. Therefore, the Plaintiff disagreed with the defence made by Three Noble Companies. Saint Vincent asserted that since Three Noble Companies and Noble Chartering Inc. were subsidiaries of Noble Group, they shall be deemed as a whole or the agent of each other, and they were the shipper and the final voyage charterer in the present case. 


Three Noble Companies adduced the invoice issued by Noble Chartering Inc. to Noble Grain for collecting freight under the said voyage charter party. 


Three Noble Companies provided a Letter of Authorization issued by Noble Chartering Inc. on 6 July 1994, in which Noble Chartering Limited was authorized to act on behalf of Noble Chartering Inc. to negotiate and approve the issues relating to the ship??s chartering, and to perform the voyage charter party.


III.	Facts relating to Shipment of Cargo and Issuing of Bills of Lading


On 11 April 2004, Victorio C. Gregana, namely the Master of M/V ?°SEAFARER?±, issued a letter of authorization, in which the charterer or the agent of the charterer was authorized to issue on behalf of the Master any bills of lading but always in strict conformity with the current effective charter party.


From 13 April to 17 April, 59,752.734tons of soyabeans were loaded onboard M/V ?°SEAFARER?± owned by Saint Vincent at Paranagua, Brazil. On 17 April, Noble Grain, acting as the agent of the Master of M/V ?°SEAFARER?±, issued two original order bills of lading No.1 & 2 for the said cargo. The B/L No.1 specified 22,000tons of soyabeans clean on board, and the B/L No.2 specified 37,725.734tons of soyabeans clean on board. It was specified as follows in these two bills of lading: Shipper: Noble Grain; Consignee: to order; Notify Party: the Plaintiff; Port of Loading: Paranagua, Brazil; Port of Discharging: Chiwan, Shenzhen, China; Vessel: M/V ?°SEAFARER?±; Freight prepaid as per Charter Party dated 1 March 2004; Weight, measure, quality, quantity, condition, contents and value unknown. It was stated on the heading of the bills of lading that ?°to be used with charter parties?±. It was stated on the reverse side of the two bills of lading that all terms and conditions, liberties and exceptions of the Charter Party, dated as overleaf, including the Law and Arbitration Clause, are herewith incorporated. These two bills of lading were endorsed by Noble Grain (namely the shipper stated on the front of the Bs/L) to the Plaintiff.


Before loading, the surveyor from the Ministry of Agriculture of Brazil embarked the vessel to inspect the conditions of the cargo holds, and issued the Certificate of Fitness for the Carriage of Cargo. The surveyors from Intertek Caleb Bret Company, SGS, Control Union World Group Company, and Saybolt/concremat Company, as entrusted by the owner, the charterers and the shipper, embarked the vessel to inspect the conditions of the cargo holds, and respectively issued the Cargo Hold Inspection Certificates, showing that before loading the cargo holds were clean and dry, and fit for the carriage of soya beans at issue. SGS carried out quality inspection, chemical residues inspection and plant inspection on soya beans after completion of loading. On 17 April, SGS issued the Quality Certificate, Certificate of Origin, Phytosanitary Certificate, Chemical Residues Certificate, and Non-wooden Packing Certificate. The Quality Certificate stated that the quality of the soya beans loaded onboard the vessel was as follows: moisture content: 12.57%, damaged kernels: 5.75%, heat damaged kernels: 0.97%, foreign materials: 0.95%, splits: 9.88%, other-color kernels: 0, oil content: 20.35%, and protein: 35.36%.


IV.	Facts relating to the Voyage of M/V ?°SEAFARTER?±


At 1612hrs on 18 April, M/V ?°SEAFARER?± departed from Paranagua and sailed towards east, bound for Shanghai, China by passing through South Atlantic Ocean and the south part of Indian Ocean. The route was instructed by Noble Chartering and provided by Applied Weather Technology Inc.


From 21 April to 10 May, M/V ?°SEAFARER?± encountered bad weather, with the wind reaching the force 7-8. The sea and swell hit over the deck and the hatch covers of all the cargo holds. The vessel pitched heavily. Due to the bad weather, the vessel could not ventilate the cargo holds until 13 May.


On 27 April, the Master of M/V ?°SEAFARER?± received a telex from Noble Chartering Limited, in which the Master was informed that the discharging port was Chiwan, rather than Shanghai and was instructed to proceed to Singapore for bunkering. On 10 Mary, Noble Charting Limited again instructed the vessel to proceed to Singapore for bunkering. On 20 May, M/V ?°SEAFARER?± arrived at Singapore. At 0400hrs on 21 May, the vessel completed bunkering. On the same day, when the vessel was anchoring at the anchorage in Singapore, the surveyor from SGS appointed by Noble Grain embarked the vessel to collect samples of the cargo carried on board. On the same day, Noble Charting Limited instructed the vessel to drift off Singapore and wait for further instructions. On 25 May, Noble Chartering Limited instructed the vessel to proceed to Chiwan. On 28 May, Noble Chartering Limited instructed the vessel to anchor off Hong Kong and wait for further instructions. At 1418hrs on 29 May, the vessel arrived at Hong Kong outer anchorage, and the Master notified Noble Chartering Limited and the agent of Noble Chartering at the discharging port, namely SUNISCO, that the NOR had been tendered. The vessel kept anchoring at Hong Kong outer anchorage, waiting for voyage instructions from Noble Chartering. From 29 May to 25 June, M/V ?°SEAFARER?± kept anchoring at Hong Kong outer anchorage, waiting for instructions.


On 25 June, M/V ?°SEAFARER?± proceeded to Hong Kong Lamma Anchorage, waiting for instructions. On 26 June, the vessel set sail and proceeded to Chiwan, and the Master issued the Discharging NOR to SUNISCO. On 21 July, the vessel weighed anchor and berthed alongside Berth No.7 of Chiwan Port. 


As retained by Saint Vincent, Professor Wang Jianping, from the Navigation College of Dalian Maritime University, issued on 20 September 2005 the Analysis on the Route of M/V ?°SEAFARER?± from Paranagua, Brazil to Chiwan, China, stating that the route of M/V ?°SEAFARER?± was geographically direct and customary, economic and safe, and therefore M/V ?°SEAFARER?± did not commit any deviation.


V.	Facts relating to Quarantine Restrictions 


On 19 March 2004, the Plaintiff submitted to Guangdong CIQ the Application Form of the Quarantine Permit for Entry Animals and Plants. On 7 April, after examination, Guangdong CIQ agreed to report the Plaintiff??s application to the AQSIQ for approval. On 8 May, the AQSIQ issued to the Plaintiff the Quarantine Permit for Entry Animals and Plants No.PB00041315. On the same day, M/V ?°SEAFARER?±??s application for entry was approved, and the vessel was estimated to arrive at the discharging port on 25 May.


On 10 May, the AQSIQ issued to all the CIQ departments the Warning Circular Regarding Brazilian Soya Beans mixed with Soya Beans treated with Seed Coated Agent (GZJDH [2004] No. 332) (?°the Warning Circular?±), informing that four suppliers, including Noble Grain, were suspended to export Brazilian soyabeans to China and with respect to soya beans shipped en route, those in compliance with the requirements of inspection and quarantine for entry could be allowed to enter into China.


The AQSIQ issued Announcements No.58, 61 & 71 on 22 May, 17 June, and 21 June respectively, emphasizing that ?°with respect to soyabeans shipped en route before the release of this Announcement, those in compliance with the requirements of inspection and quarantine for entry could be allowed to enter into China?±.


On 28 May, the Plaintiff sent a letter to Noble Grain, requesting Noble Grain to provide the Agricultural GMO Safety Certificate (Import) issued by the Ministry of Agriculture of the People??s Republic of China.


On 17 June, the Plaintiff faxed the Quarantine Permit for Entry Animals and Plants to Noble Grain.


On 18 June, the Plaintiff acquired the Examination and Approval Document for Identification of Agricultural GMO (NJBJZ(2004) No.0777) from the Ministry of Agriculture. On 25 June, Noble Grain acquired the Agricultural GMO Safety Certificate (Import) (NJAJZ(2004)No.0907 issued by the Ministry of Agriculture on 18 June.


On June 23, the AQSIQ issued Announcement No.76, ordering as follows: the suppliers listed in the Warning Circular (including Noble Grain) resumed qualification of exporting Brazilian soya beans to China; with respect to those soybeans shipped en route before 11th June 2004, if soya beans were mixed with soybeans treated with seed coating agent, soya beans treated with seed coated agent should be picked up and disposed of before discharging, and soya beans would not be allowed to enter into China until they were found in compliance with the relevant requirements of China; all the costs arising from the pick up and disposal of soya beans treated with seed coated agent shall be borne by suppliers; otherwise soya beans would be returned to the loading port.


On 1 July, Noble Grain reported the cargo to Shekou CIQ for inspection.


On 2 July, M/V ?°SEAFARER?± arrived at the quarantine anchorage of Chiwan, and Shekou CIQ embarked the vessel and collected the samples of the cargo at issue. On 6 July, Shekou CIQ issued the Inspection and Quarantine Treatment Notice, saying that: when carrying out inspection and quarantine, Shekou CIQ found soya beans (GMO) carried onboard M/V ?°SEAFARER?± mixed with soya beans treated with seed coated agent; soya beans treated with seed coated agent shall be picked up and disposed of before discharging. Soya beans would not be allowed to enter into China until they were found in compliance with the relevant inspection and quarantine requirements; soya beans treated with seed coated agent shall be burnt; the costs arising from picking up soya beans treated with seed coated agent shall be borne by Noble Grain.


On 8 July, Noble Grain and the Plaintiff concluded the Supplementary Agreement to the Sales Contract No.NC070316-B and NC070586, agreeing that all the costs arising from disposing and picking up red beans shall be borne by Noble Grain. 


On 9 July, the Summary of the Meeting among Four Parties was entered into among Noble Grain, the Plaintiff, Chiwan Shipping Foodstuff Wharf Co., Ltd., and SUNISCO, according to which, Noble Grain was responsible for picking up and disposing of red beans, and the costs incurred therefrom shall be borne by Noble Grain, while the normal discharging fees shall be borne by the Plaintiff.


On 16 July, Shekou CIQ sent to Noble Grain the Notice regarding the Implementation of the Plan for Supervision, the Pick-up, and Disposal of Red Beans Carried onboard M/V ?°SEAFARER?±, requesting Noble Grain to strictly observe the relevant provisions. 


On 19 July, Shekou CIQ sent a notice to the Plaintiff, saying that sorghum halepense and sorghum almum parodi were found mixed with soya beans carried onboard M/V ?°SEAFARER?±, which shall be disposed of through quarantine treatment. Shantou Zhongxing paid the quarantine treatment fee in the amount of RMB207,872.


VI.	Facts relating to Discharging 


On 19 July, Noble Grain signed the Agreement on Ship??s Entry for Berth and Pick-up of Red Beans with Chiwan Foodstuff Wharf Co., Ltd.


On 22 July, M/V ?°SEAFARER?± commenced to discharge the cargo. On 28 July, the vessel shifted to the inner anchorage of Chiwan, waiting for a berth. On 31 July, the vessel berthed at Berth No.2 of Chiwan Port, and resumed discharging. At 1540hrs on 12 August, the discharge completed.


On 21 July, the cargo within the cargo hold No.3 & 5 were found mouldy and caked, and the cargo loaded within other cargo holds were also found damaged. On 23 July, Chiwan Wharf Limited issued a Letter of Protest, proving that the cargo stored in cargo hold No.3 & 5 were found mouldy and caked during discharging operations.


VII.	Facts relating to Cargo Damage and Cargo Shortage 


On 23 July, Shekou CIQ carried out an assessment on the damage to the cargo carried onboard M/V ?°SEAFARER?±. From 23 July to 12 August 2004, Shekou CIQ carried out inspections on the damage to the cargo in holds. 


On 9 December, Shekou CIQ issued a Damaged Cargo Inspection Certificate, specifying that: 2,305.74tons of soyabeans had been generally damaged, with the depreciation rate of 10%, converted into 230.574tons; 94.01tons of soya beans had been seriously damaged, with the depreciation rate of 30%, converted into 28.203tons; 9.85tons of soya beans became mouldy due to moisture, with the depreciation rate of 100%, converted into 9.85tons. The quantity of the aforesaid damaged soya beans totaled 268.627tons. Shekou CIQ considered the damage to the cargo were caused by the following reasons: 1. 9.85tons of mouldy soya beans were caused by the ingress of seawater from the gap of the hatch covers when the vessel encountered bad weather en route, and such damage occurred before discharging; 258.777tons of heat damaged soya beans were caused by the prolonged storage of soya beans within the cargo holds and the insufficient ventilation into the holds (due to the structure of cargo holds and the storage conditions, the heat produced by metabolism of soya beans could not give out if without sufficient ventilation), and such damage occurred before discharging. As specified in the Damaged Cargo Inspection Certificate, the inspection fee was RMB34,556.


As entrusted by Saint Vincent, Guangzhou Balance Cargo Control and Survey Ltd. carried out inspections on damage to soya beans respectively from 21 July to 12 August, and on 21 August, 22 August and 26 August 2004. On 18 August 2005, Guangzhou Balance Cargo Control and Survey Ltd. issued a Survey Report No.B04HTBRT2071, stating that: there were 2,409.60tons of damaged soya beans at maximum, including 2,399.75tons of heat damaged soya beans, with net loss of 78.28tons, and 9.85tons of mouldy soya beans, which was not eatable. The total loss of the damaged soya beans was in the amount of US$37,056.90. The direct causes of such damage were as follows: the cargo had inherent defects; some cargo had been wetted before loading; the mouldy soya beans under both ends of the central joint of two hatches of each cargo hold were probably caused by the water ingress from the hatch cover. The prolonged voyage and discharging were the external conditions for the damage to soya beans, which accelerated the mould/caking/discoloration of soya beans.


As appointed by Saint Vincent and the P & I Club of M/V ?°SEAFARER?±, Double Hope arranged surveyors to embark the vessel when the vessel was berthing at Berth No.7 of Chiwan Port on 24 July 2004 and the following dates to carry out inspections on the conditions of soya beans in bulk loaded onboard the vessel. On 20 November, Double Hope issued the Survey Report No.DHSA-M-(04)070, specifying as follows: part of the wet damaged cargo had probably been caused by water ingress by way of joints in the covers or around coaming due to the vessel??s encountering of more than two weeks of heavy weather; however, a localized area of cargo damaged by water would have no effect on the entire cargo stow; other damage to the cargo were caused by the long-time storage onboard the vessel and the delay in discharging due to the search for red beans. The Plaintiff raised no objection to the survey report issued by Double Hope, but Three Noble Companies raised an objection to the analyses on the causes of the accident stated in the said survey report.


On 17 August, Shekou CIQ issued the Weight Inspection Certificate, which stated that: according to the drafts before and after the discharge and the weight of hull material, based on the Vessel Displacement Table provided by the ship interest, and through necessary correction, the weight of the cargo loaded onboard M/V ?°SEAFARER?± was 59,618.30tons.


VIII.	Losses claimed by the Plaintiff


1.	Loss of Shortage


The actual quantity of the cargo discharged was 59,618.30tons as specified in the Weight Inspection Certificate issued by Shekou CIQ, which was 107.434tons less than the total quantity of the cargo covered by the Bs/L No.1 & 2. The Plaintiff contended that the loss of the cargo short-landed was RMB435,107.70 calculated as per the after-tax price of soya beans at RMB4,050/ton. Saint Vincent contended as follows: in accordance with Article 2 of the Hague-Visby Rules, the loss of or damage to the cargo shall not include the duties; in accordance with Article 55 of the Maritime Code of the People??s Republic of China, the loss of or damage to the cargo shall be calculated on the basis of CIF price; the quantity of the cargo discharged was measured by Shekou CIQ by means of weight by draft, and pursuant to Article 3 of the Rules for the Weight Survey of Import and Export Commodities-Weight by Draft, the allowable error of draft survey is 0.5%; the loss of cargo shortage alleged by the Plaintiff was within 0.5% error of draft survey, and therefore the carrier shall not be held liable for the said cargo shortage. Three Noble Companies contended that the Plaintiff??s assertion of calculating the loss as per the after-tax unit price of soya beans did not comply with the provisions of Article 55 of the Maritime Code of the People??s Republic of China, and the loss thereof shall be calculated as per CIF price.


2.	Loss of Damaged Cargo


The quantity of the damaged cargo as stated in the Damaged Cargo Inspection Certificate issued by Shekou CIQ was 268.627tons. The Plaintiff contended that the loss incurred therefrom totaled RMB1,087,939.35 calculated as per the after-tax price of RMB4,050/ton. Saint Vincent and Three Noble Companies raised the defence same as mention above, asserting that the loss shall be calculated as per CIF price. Saint Vincent further contended that except 9.85tons of mouldy soya beans, other damage to the cargo was caused by the inherent defect of the cargo, the prolong voyage and the prolong discharging, for which the carrier shall not be held liable.


3.	Loss of Inspection Fees 


On 24 December 2004, Shantou Zhongxing paid through Guangdong Development Bank to Chiwan Wharf Limited the amount of RMB34,556, as the ?°Inspection Fee on Damaged Cargo loaded onboard M/V ?°SEAFARER?±. The Plaintiff alleged that it was the port authority, rather than the Plaintiff, that requested for the inspection on the damaged cargo, and that upon request by Shekou CIQ, Shantou Zhongxing paid the inspection fee to Chiwan Wharf Limited. Saint Vincent contended Shekou CIQ was not the payee of the said inspection fee and it could not be proven that such fee had already been paid to Shekou CIQ. Saint Vincent requested the Court not to admit such inspection fee in the sum of RMB34,556. 


4.	Loss resulted from the Increase of Warehousing Fee


The Plaintiff asserted as follows: M/V ?°SEAFARER?± did not arrive at the port of discharging until 12 July 2004, nearly at the same time with M/V ?°HUA FENG?±, another ship carrying soya beans of Shantou Zhongxing; Shantou Zhongxing had to pick up the cargo carried by M/V ?°HUA FENG?± first and put them into production, whilst the cargo carried by M/V ?°SEAFARER?± were stored at Chiwan Wharf for another two months, giving rise to the warehouse storage fee in the sum of RMB948,696.53. In order to support its claim, the Plaintiff submitted the following evidential materials: Lump Sum Contract of Loading, Discharging, storing and Transshipping Soya Beans concluded between Shantou Zhongxing and Chiwan Shipping Foodstuff Wharf Co., Ltd. on 25 April 2003; Warehouse Storage Fee for M/V ?°SEAFARER?± (04V02269,Shantou Zhongxing), and 12 invoices. 


Saint Vincent contended as follows: in accordance with Article 55 of the Maritime Code of the People??s Republic of China, the loss of or damage to the cargo shall be calculated on the basis of CIF price, not inclusive of the loss incurred from the increase of the warehouse fee alleged by the Plaintiff. Even if the loss incurred from the increase of the warehouse fee did exist, such loss was caused by the failure of the Plaintiff and Noble Grain to timely acquire the inspection and quarantine permit for the cargo, and it was impossible for Saint Vincent to foresee such loss. Therefore, Saint Vincent shall not be held liable for such loss.


Three Noble Companies contended as follows: the warehouse fee alleged by the Plaintiff was not true, and the documents submitted by the Plaintiff in support of such warehouse fee did not comply with the evidence collected by the Court. Even though the increased warehouse fee did exist, such fee shall be paid by Shantou Zhongxing. No casual relationship existed between the damage to the cargo at issue and such fee. Therefore, the carrier shall not be held liable.


5.	Loss of liquidated damages


The Plaintiff contended as follows: in May, Shantou Zhongxing, according to its normal production schedule, concluded  salad oil sales contracts and soya bean meals sales contracts with other parties, but due to the delay of M/V ?°SEAFARER?± in arriving at the discharging port, Shantou Zhongxing could not perform these sales contracts, and paid RMB18,709,000 of liquidated damages to other parties, namely the liquidated damages in the amount of RMB12,406,000 for 11 soya bean meals sales contracts, and the liquidated damages in the amount of RMB6,303,000 for 5 soya bean meals sales contracts; it could be seen from the salad oil sales contracts and soya bean meals sales contracts submitted by the Plaintiff that: these contracts were signed from 20 May to 21May 2004, and on 1 June 2004, and the agreed delivery time was from 1 June to 10 June; if Shantou Zhongxing failed to deliver the cargo within the agreed period, the failure of Shantou Zhongxing in delivering the cargo within 3 days after the expiry of the agreed period, would constitute a material breach, as result of which, the breaching party shall pay 10% of the payment as the liquidated damages.


Saint Vincent contended as follows: Shantou Zhongxing knew M/V ?°SEAFARER?± could not arrive at the discharging port on 24 May, but still concluded salad oil sales contracts and soya bean meals sales contracts from 20 May to 21May 2004, and on 1 June 2004, agreeing to deliver the cargo within 10 days, which constituted an intention to aggravate the loss; even if the loss of liquidated damages alleged by the Plaintiff did exist, such loss was caused by the failure of the Plaintiff and Noble Grain to timely acquire the inspection and quarantine permit for the cargo, and it was impossible for Saint Vincent to foresee such loss. Therefore, Saint Vincent shall not be held liable for such loss.


Three Noble Companies contended as follows: the warehouse fee alleged by the Plaintiff was not true; even if such loss did exist, it was attributed to the act of Shantou Zhongxing of signing the contracts with third parties under the circumstance that it knew those contracts could not be performed. Therefore the carrier shall not be held liable.


6.	Loss of Transportation Costs


The Plaintiff contended as follows: Shantou Zhongxing had concluded a long-term cargo transportation agreement with a transportation company. From 1 March 2004 to 30 June 2004, the transportation costs were relatively low. Due to the increase of the oil price, the transportation costs increased since 1 July 2004. As a result of the delay of M/V ?°SEAFARER?± in arriving at the discharging port, the transportation costs for soya bean meals processed from the cargo at issue increased, which caused the loss of transportation costs to Shantou Zhongxing, in the sum of RMB1,251,500. The Plaintiff submitted the following evidential materials: the cargo transportation agreement concluded between Shantou Zhongxing and Chenghai Long Du Transportation Company on 1 July 2003; the cargo transportation agreement concluded between Shantou Zhongxing and Xiajiang Long Du Transportation Company in July 2004; car transportation price list, and invoices for transportation costs etc.


Saint Vincent asserted that the loss of transportation costs alleged by the Plaintiff were irrelevant to the case. The evidence provided by the Plaintiff could not prove that the transportation costs were relevant to the soya bean meals processed from the cargo, and that a casual relationship existed between such costs and the prolong voyage of M/V ?°SEAFARER?±. Saint Vincent requested the Court not to admit such costs.


Three Noble Companies contended that a casual relationship did not exist between the loss of transportation costs alleged by the Plaintiff and the delay of M/V ?°SEAFARER?± in discharging. In addition, it was in lack of evidence to prove the transportation costs were related to the soya beans loaded onboard M/V ?°SEAFARER?±. Besides, such loss could not be foreseen by the carrier. Such loss claimed by the Plaintiff was legally and factually groundless.


7.	Loss resulted from the Decrease of Oil Extraction Rate


The Plaintiff asserted that the oil extraction rate of the cargo was only 17.64% due to the delay of M/V ?°SEAFARER?± in arrival, lower than the oil content of 20.35% tested at the port of loading. The cargo at issue only produced 10.470tons of soya bean oil, with the reduction of 1,603.38tons of soya bean oil. Based on the average price of RMB6,453.33/ton, the loss arising from the reduction of soya bean oil was RMB10,347,140. In order to support its claim, the Plaintiff submitted the Production of Brazilian Soya Beans, the Comparison of Production Economic Technical Indexes between Brazilian Soya Beans carried by M/V ?°SEAFARER?± and Brazilian Soya Beans in 2002, the Form of Increase of Production Cost, and the Statement of Daily Production of Shantou Zhongxing.


Saint Vincent contended that according to the Opinions on Oil Extraction Rate and Processing Costs of Soya beans Carried by M/V ?°SEAFARER?± issued by Researcher Wang Bujun from the CQSTC, the actual oil extraction rate of soya beans carried on board M/V ?°SEAFARER?± was 18.99%. Taken into consideration the use rate, oil extraction efficiency, and purifying rate of soya beans, and oil extraction skills, quality of auxiliary materials, control and management skills of the oil processing factory, the actual oil extraction output of soya beans carried by M/V ?°SEAFARER?± was within the normal scope. Furthermore, Saint Vincent had delivered in accordance with the Bs/L the cargo in apparent good condition. Shantou Zhongxing processed the soya beans during the period of 1 to 3 months after discharging. The loss resulted from the decrease of oil extraction rate occurred after expiry of the period of carrier??s responsibilities.


Three Noble Companies contended that the loss resulted from the decrease of oil extraction rate as alleged by the Plaintiff did not exist. The Plaintiff did not submit evidence to prove the soya beans put into production by Shantou Zhongxing were those carried by M/V ?°SEAFARER?±. Even if the soya beans put into production by Shantou Zhongxing were the cargo, according to the Opinions on Oil Extraction Rate and Processing Costs of Soya beans Carried by M/V ?°SEAFARER?± issued by Researcher Wang Bujun from the CQSTC, the actual oil extraction output of soya beans carried by M/V ?°SEAFARER?± was within the normal scope. Therefore, the carrier shall not be held liable.


8.	Loss resulted from the Increase of Production Costs 


The Plaintiff asserted that due to the quality problems of the Brazilian soya beans at issue (such as the high acid value), more raw materials and auxiliary materials had been consumed for the production; compared with the production costs of Brazilian soya beans in 2002, the production costs of Brazilian soya beans at issue had increased RMB237,951. The Plaintiff submitted the following evidential materials to support its claim: the Production of Brazilian Soya Beans, the Comparison of Production Economic Technical Indexes between Brazilian Soya Beans carried by M/V ?°SEAFARER?± and Brazilian Soya Beans in 2002; the Form of Increase of Production Cost; the Statement of Daily Production; Material Collection List and the Invoices for Purchase of Raw Materials and Auxiliary Materials. 


Saint Vincent contended that pursuant to the Opinions on Oil Production Rate and Processing Costs of Soya beans Carried by M/V ?°SEAFARER?± issued by Researcher Wang Bujun from the CQSTC, the production economic technical indexes of soya beans carried by M/V ?°SEAFARER?± provided by the Plaintiff (i.e. electricity consumption at oil production workshops, the consumption of carclazyte, alkali, diesel oil, and phosphoric acid at purifying workshops) were within the technical indexes of the clean production at the secondary standard, or normal, and the alleged increase of production costs did not exist. In addition, Saint Vincent had delivered in accordance with the Bs/L the cargo in apparent good condition. Shantou Zhongxing processed the soya beans at issue during the period of 1 to 3 months after discharging. The loss resulted from the increase of production costs alleged by the Plaintiff occurred after expiry of the period of carrier??s responsibilities, and such loss could not be foreseen by Saint Vincent.


Three Noble Companies contended that it was in lack of evidence to prove the existence of the loss arising from the increase of production costs and the relevance of such loss and soya beans carried onboard M/V ?°SEAFARER?±. Three Noble Companies requested the Court not to admit such loss.


9.	Loss sustained by Shantou Zhongxing arising from Drop of Market Price 


The Plaintiff asserted that due to the late arrival of the vessel, at which time the sales price of soya bean meals and soya bean oil decreased coincidently, plus the quality of the finished products was affected by the poor quality of the soya beans carried by M/V ?°SEAFARER?±, Shantou Zhongxing had to reduce the sales price of the finished products. As a result, the sales price of soya bean meals and that of soya bean oil were far lower than the average prices at the time of the normal arrival of M/V ?°SEAFARER?±. Compared the average sales price from 4 June to 4 July 2004 of soya bean meals (namely RMB2,837.14) and soya bean oil (namely RMB6,453.33) at Huangpu Port as cited from http://fao.com.cn, with the actual sales price of soya bean meals and soya bean oil, the loss of soya bean meals arising from the difference of sales price was calculated to be RMB17,608,055.74, and the loss of soya bean oil arising from the difference of sales price was calculated to be RMB3,857,316.59, making the market loss totaling RMB21,465,372.33. In order to support its claim, the Plaintiff submitted the following evidential materials: the List of Prices of soya bean meals and salad oil from 4 June to 4 July 2004 cited from http://fao.com.cn; the Statement of Daily Price; Soya Bean Meals Sales Contracts; Invoices; Quality Inspection Report; Soya Bean Oil Sales Contracts and Invoices. 


Saint Vincent contended that the said alleged loss in the sum of RMB21,465,372.33 occurred after expiry of the responsibility period of Saint Vincent, and such loss was unforeseeable. The Statement of Daily Prices of Soya Bean Meals and Soya Bean Oil was cited from the internet, the authenticity and accuracy of which had not been certified. Furthermore, none of the 8 consignees of soya bean meals specified in the invoices submitted by the Plaintiff in support of its claim from loss of transportation costs was identical to one of the 9 buyers under the soya bean meals sales contracts. Saint Vincent requested the Court not to admit such loss.


Three Noble Companies contended that the said alleged loss was irrelevant to the cargo carried onboard M/V ?°SEAFARER?±. The prices cited from the Internet lacked of authenticity and accuracy. Such loss could not be foreseen by the carrier at time of concluding the contract of carriage of cargo by sea. Therefore, the carrier shall not be held liable for such loss.


IX.	Facts relating to Pretrial Arrest of M/V ?°SEAFARER?±


On 10 August 2004, the Plaintiff filed an application to this Court for the pretrial arrest of M/V ?°SEAFARER?±, requesting the owner and/or the bareboat charterer to provide a security in the amount of RMB65,000,000. On the same day, the Court rendered a ruling, approving such application, and arrested M/V ?°SEAFARER?± at Chiwan Port. On 20 August, China Reinsurance (Group) Corporation and the Britannia Steamship Insurance Association provided letters of security in amounts of US$2,500,000 and US$4,000,000 respectively to the Plaintiff. The Plaintiff accepted the said securities, and applied to the Court for release of M/V ?°SEAFARER?±. The Plaintiff paid to the Court the application fee in the sum of RMB5,000 and the enforcement fee in the sum of RMB30,000.


X.	Facts relating to Application of Law


The Plaintiff asserted that since the Bs/L did not specify the applicable law agreed by the parties, the applicable law to the case shall be determined in accordance with the principle of the closest connection. Both the discharging port of the cargo and the domicile of the Plaintiff (namely the holder of the Bs/L) in this case were in China. Therefore China was the country having the closest connection with the contract of carriage of the cargo by sea, and the laws of P. R. China shall apply to this case. Saint Vincent and Three Noble Companies contended that pursuant to the clause specified in the Bs/L of ?°??the Charter Party, dated overleaf, are herewith incorporated?±, English law shall apply to the case. 


The collegial panel holds as follows:


Nature of disputes involved in the case. The Plaintiff obtained the two original bills of lading by negotiating the L/C. The Plaintiff, based on these two original bills of lading, brought this lawsuit against the carriers Three Noble Companies and the actual carrier Saint Vincent, requesting the Court to order the four Defendants to be jointly and severally liable for all the losses resulted from the delay of the arrival of the cargo. Therefore, it is a case involving foreign elements and disputes over the contract of carriage of cargo by sea.


Application of Law. Article 269 of the Maritime Code of the People??s Republic of China provides that the parties to a contract may choose the law applicable to such contract, unless the law provides otherwise. Where the parties to a contract have not made a choice, the law of the country having the closest connection with the contract shall apply. Article 3 of the Rules of the Supreme People??s Court on the Relevant Issues concerning the Application of Law in the Trial of Civil or Commercial Cases involving Foreign Elements and Contract Disputes, the parties shall choose or modify in an explicit manner the law applicable to contract disputes. Although the two original Bs/L at issue stated ?°to be used with charter parties?±, the Plaintiff??s acceptance of the Bs/L shall not be deemed as the Plaintiff??s implied consent to choose the applicable law specified in the charter party to govern the disputes arising from the contract of carriage of cargo by sea evidenced by the Bs/L. Saint Vincent and Three Noble Companies failed to prove the Plaintiff and the parties hereto had reach an agreement on the applicable law in an explicit manner. Therefore, in this case, the Plaintiff shall be deemed not having chosen the law applicable to the disputes arising from the contract of carriage of cargo by sea. Both the discharging port e and the domicile of the Plaintiff (namely the holder of the Bs/L) in this case are in China. Therefore China is the country having the closest connection with the contract of carriage of the cargo by sea, and the laws of P. R. China shall apply to this case. The assertion put forward by Saint Vincent and Three Noble Companies that English law shall apply to the case is factually and legally groundless, and therefore shall not be admitted.


The Plaintiff??s title to sue. The Plaintiff opened in its name two documentary L/C for the cargo under two sales contracts, and effected the payment for the cargo covered by these two L/C. The two Bs/L were lawfully transferred to the Plaintiff via the bank. The Plaintiff, as the lawful holder of the two Bs/L, has entitlement to claim compensation against the carrier and the actual carrier. The assertion put forward by Saint Vincent and Three Noble Companies that the Plaintiff did not have title to sue is factually and legally groundless, and therefore shall not be admitted.


The Identification of carrier. Pursuant to the Bs/L involved in the case, Noble Grain was the shipper of the cargo at issue, and acted as the agent of the Master of M/V ?°SEAFARER?± to issue the Bs/L. Before Noble Grain issued the Bs/L, the Master of M/V ?°SEAFARER?± issued a letter of authorization, authorizing the charterer or the agent of the charterer to issue on behalf of the Master any bills of lading but always in strict conformity with the current effective charter party. Before issuance of the Bs/L involved in the case, a contractual relationship established by the voyage charter party existed between the owner Noble Europe and the charter Noble Grain. Furthermore, the Bs/L stated ?°to be used with charter parties?±. In light of the foregoing, Noble Grain shall be deemed having issued the Bs/L as the agent of the Master in accordance with the said voyage charter party. Article 72(2) of the Maritime Code of the People??s Republic of China provides the bill of lading may be signed by a person authorized by the carrier, and a bill of lading signed by the Master of the ship carrying the cargo is deemed to have been signed on behalf of the carrier. The Bs/L involved in the case shall be deemed to have been signed by the Master on behalf of the carrier. Before issuance of the Bs/L involved in the case, Noble Europe signed a voyage charter party with Noble Grain, in which Noble Europe was the owner and the Noble Grain was the charterer. In accordance with Section 1 of Chapter IV of the Maritime Code of the People??s Republic of China, a voyage charter party is one of the contracts of carriage of cargo by sea. Noble Europe was the carrier, and Noble Grain was the shipper. The Master issued the Bs/L on behalf of the carrier Noble Europe. Three Noble Companies asserted that Noble Europe had been mistakenly written as the owner in the said voyage charter party, and the owner in fact should be Noble Chartering Inc. Such assertion did not comply with the facts ascertained by the Court, and therefore shall not be admitted. Three Noble Companies contended that in accordance with English law, the carrier under the contract of carriage of cargo by sea in this case was Saint Vincent. As mentioned above, the Court has confirmed that the laws of P. R. China, rather than English law, shall apply to the substantive issues of this case. Therefore, the said assertion of Three Noble Companies lacked of supporting evidence, and shall not be admitted. Noble Europe, Noble Grain, and Noble Chartering are lawfully incorporated legal persons, independent from each other, and it is in lack of evidence to prove that Three Noble Companies were representatives of each other. Although during the voyage of M/V ?°SEAFARER?± Noble Chartering Limited gave instructions to the vessel, such as instructing the vessel to bunker, anchor, wait for instructions, and berth, there is no evidence to prove that Noble Chartering Limited was the carrier signing the contract of carriage of cargo by sea with the shipper Noble Grain. Besides, the shipper Noble Grain also denied that Noble Chartering Limited was the carrier. Therefore, the assertion put forward by the Plaintiff and Saint Vincent that Noble Europe, Noble Grain and Noble Chartering shall be jointly deemed as the carrier is factually groundless, and shall not be admitted. The Plaintiff??s claims against the Defendants Noble Grain and Noble Chartering Limited are dismissed.


The actual carrier. Saint Vincent, as the owner of M/V ?°SEAFARER?±, employed crews, controlled the actual operations of the ship and actually performed the carriage of the cargo by sea. In accordance with Article 42(1) of the Maritime Code of the People??s Republic of China, Saint Vincent shall be the actual carrier of the cargo.


The responsibilities of the carrier and the actual carrier:


1. Deviation. Article 49(1) of the Maritime Code of the People??s Republic of China provides that the carrier shall carry the cargo to the port of discharge on the agreed or customary or geographically direct route. In this case, there is no evidence to prove the shipper and the carrier or the actual carrier had agreed on a route. Three Noble Companies contended under the circumstance that the carrier and the shipper did not agree on the route, the route chosen by M/V ?°SEAFARER?± was a customary or geographically direct route. The Analysis on the Route of M/V ?°SEAFARER?± from Paranagua, Brazil to Chiwan, China issued by Professor Wang Jianping from the Navigation College of Dalian Maritime University as submitted by Saint Vincent specified that the route involved in the case was geographically direct and customary, economic and safe. The Plaintiff did not raise sufficient rebuttal opinions. Therefore, the export opinions provided by Saint Vincent shall be adopted. M/V ?°SEAFARER?± carried the cargo at issue to the discharging port by taking a customary and geographically direct route, without any deviation.


2. Delay in delivery. Article 50 of the Maritime Code of the People??s Republic of China provides that delay in delivery occurs when the cargo have not been delivered at the designated port of discharge within the time expressly agreed upon. In this case, the time of delivery of the cargo had not been expressly agreed. Therefore, delay in delivery did not exist in the case. The assertion of the Plaintiff that the carrier and the actual carrier committed a delay in delivery is factually groundless, and shall not be admitted. 


3. Causes of the prolonged voyage and delay in discharge. The cargo at issue was Brazilian Soya beans, which are compulsively required by the laws of China to go through import inspection and quarantine. In accordance with the Regulations for Administration of Safety of Agricultural Genetically Modified Organism promulgated by the State Council, the Measures for Administration of Imported Agricultural Genetically Modified Organism promulgated by the Ministry of Agriculture, the Measures for Administration of Agricultural Genetically Modified Organism Identification promulgated by the Ministry of Agriculture, and the Measures for Administration of Inspection and Quarantine on Genetically Modified Products for Entry and Exit promulgated by the AQSIQ, before importing soya beans into China, the Quarantine Permit for Entry Animals and Plants (which shall be obtained by the domestic import enterprise from the AQSIQ), the Agricultural GMO Safety Certificate (which shall be obtained by the foreign exporter from the Ministry of Agriculture), the Examination and Approval for Identification of Organisms (which shall be obtained by the domestic import enterprise from the Ministry of Agriculture) shall be acquired in advance. When the cargo arrive at the port of destination, in order to complete the procedures of inspection and quarantine, the importer or the exporter must present the said three certificates to the competent authorities.


Based on the facts ascertained by the Court, on 10 Mary, the AQSIQ issued the Warning Circular, informing that four suppliers, including Noble Grain, were suspended to export Brazilian soya beans to China and with respect to soya beans shipped en route, those in compliance with the requirements of inspection and quarantine for entry could be allowed to enter into China. On 23 June, the AQSIQ issued Announcement No.76, ordering as follows: the suppliers (including Noble Grain) resumed the qualification of exporting Brazilian soya beans to China; with respect to those soybeans shipped en route before 11 June 2004, if soya beans were mixed with soybeans treated with seed coating agent, soya beans treated with seed coated agent should be picked up and disposed of before discharging, and soya beans would not be allowed to enter into China until they were found in compliance with the relevant requirements of China; all the costs arising from the pick up and disposal of soya beans treated with seed coated agent shall be borne by suppliers; otherwise soya beans would be returned to the loading port. 


On 8 May, the AQSIQ issued to the Plaintiff the Quarantine Permit for Entry Animals and Plants No.PB00041315. On 17 June, the Plaintiff faxed the Quarantine Permit for Entry Animals and Plants to Noble Grain. On 18 June, the Ministry of Agriculture approved the Plaintiff??s application for the Examination and Approval Document for Identification of Agricultural GMO and the Agricultural GMO Safety Certificate (Import). On 25 June, Noble Grain acquired the Agricultural GMO Safety Certificate (Import). On 2 July, M/V ?°SEAFARER?± arrived at the quarantine anchorage of Chiwan, and Shekou CIQ embarked the vessel and collected the cargo samples. Shekou CIQ found red beans mixed with soya beans onboard M/V ?°SEAFARER?±. On 6 July, Shekou CIQ issued the Inspection and Quarantine Treatment Notice, requesting that: soya beans treated with seed coated agent shall be picked up and disposed of before discharging. Soya beans would not be allowed to enter into China until they were found in compliance with the relevant inspection and quarantine requirements; soya beans treated with seed coated agent shall be burnt; the costs arising from picking up soya beans treated with seed coated agent shall be borne by Noble Grain.


The aforesaid facts show the direct causes of the prolonged voyage (namely 3 months plus 26 days), including the time for discharge, are the failure of the Plaintiff and Noble Grain to timely obtain the Quarantine Permit for Entry Animals and Plants, the Examination and Approval Document for Identification of Agricultural GMO and the Agricultural GMO Safety Certificate (Import), and the finding of red beans mixed in the cargo stow (such red beans must be picked up from soya beans before discharge so that soya beans could be allowed into China). The losses caused by the said reasons are trade disputes between the Plaintiff and Noble Grain, which shall be precluded from the substantive issues of this case that this Court should consider. 


4. Liabilities of the carrier and the actual carrier. Article 55(1) of the Maritime Code of the People??s Republic of China provides that the amount of indemnity for the loss of the cargo shall be calculated on the basis of the actual value of the cargo so lost, while that for the damage to the cargo shall be calculated on the basis of the difference between the values of the cargo before and after the damage, or on the basis of the expenses for the repair. In this case, liability to be assumed by Noble Europe is the loss of and damage to the cargo. Article 63 of the Maritime Code of the People??s Republic of China provides that where both the carrier and the actual carrier are liable for compensation, they shall jointly and severally be liable within the scope of such liability. With regard to the loss of and damage to the cargo occurred during the period when the actual carrier Saint Vincent was in charge of the cargo, the actual carrier Saint Vincent and the carrier Noble Europe shall be jointly and severally liable. As to the loss resulted from the increase of warehousing fees, loss of liquidated damages, loss of transportation costs, loss resulted from the decrease of oil extraction rate, loss resulted from the increase of production costs, loss arising from dropping of market price claimed by the Plaintiff, they were all caused by the prolonged voyage and delay in discharge. The Plaintiff and Noble Grain shall based upon their sales contract to solve dispute over the said losses, for which the carrier and the actual carrier shall not be held liable. 


Compensation scope for cargo damage and cargo shortage 


1. Cargo shortage. The actual quantity of the cargo discharged was 59,618.30tons as specified in the Weight Inspection Certificate issued by Shekou CIQ, which was 107.434tons less than the total quantity (namely 59,725.734tons) of the cargo covered by the two Bs/L. As the cargo shortage occurred during the period when Noble Europe was in charge of the cargo, Noble Europe and the actual carrier Saint Vincent shall be jointly and severally liable for this part of loss. The argument put forward by Saint Vincent that the carrier can rely on the trade allowance of 0.5% to have liability exemption is factually and legally groundless, and shall not be admitted. Article 55(2) of the Maritime Code of the People??s Republic of China provides that the actual value shall be the value of the cargo at the time of shipment plus insurance and freight. The Plaintiff effected the payment in the amount of USD15,201,207.26 for 37,725.734tons of the cargo covered by the L/C No.LC5300122/04, and the payment in the amount of USD9,912,320 for 22,000tons of the cargo covered by the L/C No.LCZP808200410048. The price of the cargo stated in the commercial invoices provided by Noble Grain are the same as the payment made by the Plaintiff. Therefore, the average price of soyabeans was USD420.48/ton. The actual value of soyabeans shall be calculated as per USD420.48/ton. The assertion by the Plaintiff that the actual value of the cargo shall be calculated as per after-tax price of RMB4,050/ton is legally groundless, and shall not be admitted. In summary, Noble Europe shall compensate the Plaintiff for the loss of cargo shortage in the sum of USD45,173.85, equivalent to RMB373,899.44 at the exchange rate of US$1=RMB8.2769 published by the People??s Bank of China on the date of completion of discharge of M/V ?°SEAFARER?± (namely 12 August 2004).


2. Loss of Damaged Cargo. Pursuant to the survey report issued by Guangzhou Balance Cargo Control and Survey Ltd., there were 2,409.60tons of damaged soya beans at maximum, including 2,399.75tons of heat-damaged soya beans, with the net loss of 78.28tons, and 9.85tons of wet and mouldy soyabeans. The direct causes of such damage were as follows: the cargo had inherent defects; part of the cargo had been wetted before loading; the mouldy soya beans were probably caused by the water ingress from the hatch covers. The prolonged voyage and discharging were the external cause for the cargo damage, which accelerated the mould/caking/discoloration of soyabeans. Shekou CIQ issued a survey report on the conditions and causes of the cargo damage, specifying that: 9.85tons of wet and mouldy soya beans were caused by the ingress of seawater from the gap of the hatch covers when the vessel encountered bad weather en route, and such damage occurred before discharging; 258.777tons of heat-damaged soyabeans were caused by the prolonged storage of soyabeans in cargo holds and the insufficient ventilation to the holds, and such damage occurred before discharging. The said survey report issued by Shekou CIQ as submitted by the Plaintiff was issued by an independent third party in the first time. The Defendants did not point out any defect of the survey procedures and the grounds of findings therein. Therefore, the survey report issued by Shekou CIQ shall be adopted given there is no sufficient evidence produced by the Defendants to the contrary. 9.85tons of wet and mouldy soyabeans were caused by the ingress of seawater from the gap of the hatch covers which was attributed to the non-weathertightness of the cargo holds of M/V ?°SEAFARER?±, and thus Noble Europe as the carrier shall be held liable. Noble Europe shall compensate the Plaintiff for the loss of 9.8tons of wet and mouldy soya beans, which is in amount of RMB34,280.67 calculated as per the unit cargo price at USD420.48/ton and the exchange rate of US$1=RMB8.2769 published by the People??s Bank of China on the date of completion of discharge of M/V ?°SEAFARER?±.  


Heat Damage to the 258.777tons of soya beans were caused by the prolonged storage of cargo in holds and the insufficient ventilation into the holds. The collegial panel holds that heat damage shall partially be ascribed to the delay of the seller and the buyer (i.e. the Plaintiff and Noble Grain) in fulfilling the procedures for obtaining the required import documents for the cargo, and partially due to the improper care of the cargo by the carrier. Given it is difficult to apportion the loss ratio caused by the aforesaid two elements, the collegial panel on its discretion determines that Noble Europe shall undertake 50% of the loss of 258.777tons of heat-damaged soya beans. Noble Europe shall compensate the Plaintiff for 50% of the loss of 258.777tons of heat-damaged soya beans, equivalent to RMB450,307.03 calculated as per the unit cargo price at USD420.48/ton and exchange rate of US$1=RMB8.2769 published by the People??s Bank of China on the date of completion of discharge of M/V ?°SEAFARER?±. Saint Vincent shall jointly and severally undertake the compensation liability on the part of Noble Europe. 


Inspection fees on damaged cargo. Based on the facts ascertained by the Court, the inspection on the damaged cargo was not applied by the Plaintiff, and the inspection fees arising therefrom, in the amount of RMB34,556, were paid by Shantou Zhongxing, rather than the Plaintiff. The Plaintiff did not sustain the loss of inspection fees. Therefore, the inspection fees claimed by the Plaintiff shall not be admissible. 


The fees incurred from the Plaintiff??s application for pretrial arrest of M/V ?°SEAFARER?± and the evidence preservation shall be borne by the Plaintiff, Noble Europe and Saint Vincent in proportion to their respective liabilities determined.


In summary, in accordance with Articles 46(1), 51, 55, 63 and 269 of the Maritime Code of the People??s Republic of China, it is adjudged as follows:


1.	The Defendant Noble Europe Limited shall compensate the Plaintiff Henan Cereals Oils for the cargo loss in the amount of RMB858,487.14;


2.	The Defendant Saint Vincent Shipping Inc. shall be jointly and severally liable for the cargo loss sustained by the Plaintiff in the amount of RMB858,487.14;


3.	The claims lodged by the Plaintiff Henan Cereals Oils and Foodstuffs Import and Export (Group) Co., Ltd. against the Defendant Noble Grain Pte Limited and the Defendant Noble Chartering Limited shall be dismissed;


4.	Other claims lodged by the Plaintiff Henan Cereals Oils and Foodstuffs Import and Export (Group) Co., Ltd. shall be dismissed.


The litigation cost for this case is RMB279,210, of which, RMB274,755 shall be borne by the Plaintiff, and RMB4,455 shall be jointly and severally borne by the Defendant Noble Europe Limited and the Defendant Saint Vincent Shipping Inc. With respect to the fees in the amount of RMB60,000 incurred by the Plaintiff??s application for arrest of M/V ?°SEAFARER?± prior to litigation and the evidence preservation, RMB59,043 shall be borne by the Plaintiff, and RMB957 shall be jointly and severally borne by the Defendant Noble Europe Limited and the Defendant Saint Vincent Shipping Inc. The litigation fees, and the fees incurred by the Plaintiff??s application for pretrial arrest of M/V ?°SEAFARER?± and the evidence preservation have been prepaid by the Plaintiff, and this Court will not make any refund. The Defendant Noble Europe Limited and the Defendant Saint Vincent Shipping Inc. shall directly pay to the Plaintiff their proportions for such costs and expenses.  


The aforesaid payment obligation shall be fulfilled within 10 days upon the effectiveness of this Judgment. In case of any failure of payment within the period specified in this Judgment, the defaulting party shall pay double interest on the debt for the belated payment in accordance with Article 229 of the Civil Procedural Law of the People??s Republic of China.


In the event of dissatisfaction with this Judgment, the Plaintiff may within 15 days, while the Defendants Noble Europe Limited and Saint Vincent Shipping Inc. may within 30 days upon the service of this Judgment, submit the Statement of Appeal to this Court, together with copies according to the numbers of the relevant parties to the case, for filing appeal to the Higher People??s Court of Guangdong Province.









Presiding Judge	Wu Zili

Judge	Song Weili

Judge	Huang Xiwu


Guanghzou Maritime Court

(Official Chop Affixed)

17 May 2011




Certified true copy of the original

			

												Court Clerk	Zeng Huifen





The translation is provided by Wang Jing & CO.