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Civil Appeal No. 343 of 1985, decided on 11th March, 1986.

(From the Order dated 2‑11‑1985, of the Lahore High Court, passed in Civil Revision No. 989 of 1985).

‑‑ Art. 185(3)‑Carriage by Air (International Convention) Act (IX of 1966), Sched. I, r. 29‑Leave to appeal granted to defendant in a pending civil suit to examine judgment of High Court whereby its revision petition challenging derision of Senior Civil Judge on a preliminary issue was dismissed and finding was affirmed that civil suit instituted for damages arising out of a contract for carriage of goods by air from Pakistan to U. S. A. was not barred by r. 29 of First Schedule to Act, 1966.

Sched. I, r. 29‑Suit for damages arising out of a contract for carriage of goods by air‑Limitation‑Expression: "When the goods ought to be delivered"‑Interpretation‑Plaintiff consignor was informed on 1‑11‑1981 of arrival of goods at destination‑Consignee was also informed of arrival of goods at destination who refused to take delivery of said goods and had reasons for that‑No extension of time either explicit or implied found‑No modification, alteration or change in position on part of respondent or his agents also found‑Date when aircraft ought to have arrived being not in dispute, time started to run from 1‑11‑1981 and two years came to an end on 1‑11‑1983‑Suit instituted on 29‑9‑1984, held, was time- barred and right of plaintiff to claim damages, therefore, was extinguished thereafter.

Federation of Pakistan v. Sh. Muhammad Idrees Barry P L D 1964 (W.P.) Lah. 457 ; Guzlar Ahmed v. Sind Punjab Goods Transport Co. P L D 1966 (W P.) Kar. 253 ; Abdul Jalil Chowdhry v. The Muhammadi Steamship Co. Ltd. and another P L D 1961 S C 340 ; Boots Mal v. Union of India A 1 R 1962 S C 1716 ; Nagendranath v. Suresh Chandra A I R 1932 P C 161 and General Accident Fire and Life Assurance Corporation Lid. v. Janmahomed Abdul Rahim A I R 1941 P C 6 ref.

A. I. Chundrigar, Advocate Supreme Court instructed by M. Shabbir Ghaury, Advocate‑on‑Record for Appellant.

M. Asif, Advocate Supreme Court instructed by Ejaz Ahmad Khan, Advocate‑on‑Record (absent) for Respondent.

Date of hearing : 11th March, 1986.

‑Leave to appeal was granted to the defendant in a pending civil suit to examine the judgment of Lahore High Court dated 2‑11‑1985 whereby its revision petition challenging the decision of the Senior Civil Judge on a preliminary issue was dismissed and the finding was affirmed that a civil suit instituted on 29‑9‑1984 for damages arising out of a contract dated 30‑9‑198 for carriage of goods by Air from Sialkot to Dallas, Washington was not barred by rule 29 of First Schedule to Carriage By Air (International Convention) Act, 1966 (hereinafter referred to as the Act).

Admittedly, the plaintiff respondent, a firm located in Sialkot, consigned surgical goods in eighteen packages to the appellant through its local agents on 30‑9‑1981 for despatch by Air freight to a consignee in Dallas, Washington U. S. A. The Airway Bill dated 30‑9‑1981 was received and the Air freight of Rs. 11,414 paid. The plaintiff respon dent claimed to have enquired in writing on 1‑11‑1981 from the appellant's agents about the fate of these parcels and to have been informed "on telephone that the parcels in question had been delivered to the consignee". It was on 9‑9‑1983 that the consignee Bank informed the plaintiff respondent that the buyers "did not accept the papers regarding the consignment of 18 parcels". The plaintiff‑respondent ultimately instituted the civil suit on 29‑9‑1984 arraying the appellant and its two agents as defendants claiming U. S. dollars 10,406 as price of goods, U. S. dollars 5,394 as interest at the rate of 15 % equal to Pak Rs. 2,30,000. This claim was based on the facts that the appellant utterly failed to discharge its obligation as Carrier. Delivery of the goods to the United States Customs on 29‑10‑1981 without the knowledge of the plaintiff, and without obtaining plaintiff's instructions was, according to the plaintiff, "a glaring violation of the conditions laid down and embodied in clause 11 of the Conditions of the Contract".

The suit was resisted by the appellant on numerous grounds but the one relevant at this stage, concerned limitation. It was contended by the appellant that "the suit is time‑barred under the Carriage by Air Act, 1966 which provides for a period of 2 years only from the date of arrival of goods at the final destination i.e., third week of October, 1981".

On 17‑1‑1985 the trial Court framed two preliminary issues but the one now under consideration was as follows :‑

"Whether the suit is within time O. P. P."

No evidence was recorded. Arguments were heard on 14‑3‑1985 and the trial Court rejected the bar of rule 29 invoked by the appellant on the reasoning reproduced hereunder

"As regards the contention raised on behalf of the defendant the suit could have been instituted by or before expiry of month of October, 1983, according to section 29 of the Act, 1966 that, too, does not prevail. Because in the mark A' it is nowhere mentioned as to when the consignment was to reach Washington or as to when ought to have reached. Nor the defendant has placed on record any other such document which would support the defendants contention that the consignment was to reach or ought to have reached on such and. such date. Since both the parties involved were not sure of the beginning or continuation of the passage of time for transmission of the consignment from Sialkot to Dallas Washington, therefore, this uncertainty too could be deemed to .be sufficient to case an argument in favour of the plaintiff. Learned counsel for the defendant argued that even as the law requires a presumption could be raised that goods could have reached from Sialkot at Dallas in time of only weeks. Since something had to happen beyond the boundaries of the country as well so such a presumption could not be raised. In any case (I am of the) confirmed view that the defendant Company was obliged under the law to have conveyed to the plaintiff the time when the consignment was delivered or reached at Washington Dallas and nothing to this effect has been placed on record.

In the perspective of the above discussion I hold that the suit is within time."

A revision petition was then filed by the appellant which too was dismissed on the following reasoning

"Conversely, the respondent's case was that the application of the Limitation Act was excluded as rule 29 framed under a special law, namely, Carriage by Air (International Convention) Act, 1966, applied and a period of two years for the suit from the date of arrival at the destination or from the date on which the aircraft ought to have arrived or from the date on which the carriage stopped was provided. The expression ought to have arrived' was construed to mean final refusal of the bailee to make delivery. Reliance in this behalf was placed on Federation of Pakistan v. Sh. Muhammad Idrees Barry P L D 1964 (W.P.) Lah. 457 ; Gulzar Ahmed v. ..Sind Punjab Goods Transport Co. P L D 1966 (W.P.) Kar. 253 and Abdul Jalil Chowdhry v. The Muhammadi Steamship Co. Ltd. and another P L D 1961 S C 340. On this interpretation, the final refusal in this case was made by the petitioner's letter dated 25‑9‑1983 and the suit filed on 29‑9‑1984 was within the period of two years.

All the more, therefore, the respondent/plaintiff was justified in invoking rule 29 framed under Carriage by Air (International Convention) Act, 1966 and to start limitation from the final refusal on the part of the petitioner to arrange delivery. Considering from this premise also, the suit was rightly held to be within time."

Mr. A. I. Chundrigar, the learned counsel for the appellant, contended that a special period of limitation was prescribed in rule 29 for disputes arising out of contracts for carriage of goods by Air. As in rule 29 no specific time was prescribed, nor was it prescribed in the carriers contract, section 46 of the Contract Act got attracted to the case. Reasonable time, in the case of carriage of goods by Air would be two to three weeks and not more. On this reasoning it is contended that a suit instituted on 29‑9‑1984 on a contract dated 30‑9‑1981 was hopelessly time‑barred.

Mr. M. Asif, Advocate the learned counsel for the respondent, on the other hand contended that the contract between the parties had a clause II which provided that in case of refusal of the consignee to accept the goods "the disposition will be in accordance with the instructions of the shipper". Besides, the right of the consignor as provided in rule 12 to the effect that "if the consignee declines to accept the airway bill or the goods, or if he cannot be communicated with, the consignor reserves his right of disposition" also indicates that the carrier has to inform the consignor of the stoppage of carriage before the bar of limitation contained in rule 29 on its own words becomes applicable.

The special law requiring interpretation and application is contained in the Act. Its section 2, subsection (1) provides as follows :‑

"The rules contained in the First Schedule, being the provisions of the convention for the unification of certain rules relating to international carriage by air known as "the wars and convention as amended at The Hague 1955", hereinafter referred to as the Con vention, shall subject to the provisions of this Act, have the force of law in Pakistan in relation to any carriage by air to which those rules apply, irrespective of the nationality of the aircraft performing the carriage."

Rule 29 prescribes the limitation for actions in the following words :‑

"The right of damages shall be extinguished if an action is not brought within two years, reckoned from the date of arrival at the destination or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped."

In Chapter V‑General and Final Provisions rule 32 provides as follows :‑ .

"Any clause contained in the contract and all special agreements entered into before the damage occurred by which the parties purport to infringe the rules laid down by this schedule, or by altering the rules as to jurisdiction, shall be null and void. Never theless for the carriage of goods arbitration clauses are allowed, subject to these rules, if the arbitration is to take place in the territory of one of the high contracting parties within one of the jurisdiction referred to in rule 28."

The other laws on this subject having the same or similar language and import which have been judicially considered, are Article 31 of the Limitation Act and clause 6 of Article III of Carriage of Goods by Sea Act, 1925. Article 31 of the Limitation Act provides as hereunder :‑‑

________________________________________________________________________

Description of Period of Time from which

Suit. limitation.

period begins to

run.

________________________________________________________________________

Article 31 Against a carrier One year

When the goods

for compensation' ought to be

for non‑delivery delivered.

of, or delay in

delivering goods.

_____________________________________________________________________

The relevant portion of clause 6, Article III of Carriage of Goods by Sea Act, 1925 provides as hereunder :‑‑

"In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered."

The trial Court as well as the High Court, in computing time and extending the period of limitation took note of the fact that the cargo had to be transported to Karachi and air lifted to Dallas and more than one Airline was in fact involved. The trial Court expressed it in following words :‑

"Accordingly to this document none of the parties could be deemed sure that as to when and on which date the goods has to reach from Karachi and secondly, as to when and on which day the goods had transmitted from Karachi to Washington the place of the destination being Dallas. Since the document i.e. marked A' is silent with regard to this important fact one could hardly be expected to know the date of destination of the consignment at Washington (Dallas)."

The High Court in the impugned judgment took the following view

"Unless the petitioner could show any hard date in this behalf, it was entirely absurd to expect the respondent consignor to know of the date of delivery. Nor was it clear if the petitioner‑carrier had themselves to carry it all along or to get it transhpipped through any other carrier. The indications are that even Pan- American Airways was involved for carrying the goods at least from Washington to Dallas. Manifestly the respondent/plaintiff could not know about those internal arrangements of the petitioner with any other carrier."

In making this to be a ground both the Courts failed to notice the statutory provisions i.e. rule 1, clauses (3) and (a) defining international carriage and rule 30 apportioning rights and liabilities. . Clauses (3) and (4) of rule I are as hereunder :‑

"(3) For the purposes of these rules the expression "international carriage" means any carriage in which according to the agreement between the parties, the place of departure and the place of destination. whether or not there be a break in the carriage or a transhipment, are situated either within, the territories of two High Contracting Parties are within the territory of a single High Contracting Party if there is an agreed stopping place within the territory of another State, even if that State is not a High Contracting Party. Carriage between two points within the territory of a single High Contracting Party without an agreed stopping place within the territory of another State is not international carriage for the purposes of these rules.

(4) Carriage to be performed by several successive air carriers is deemed, for the purposes of these rules, to be one undivided carriage if it has been regarded by the parties as a single operation, whether it had been agreed upon under the form of a single contract or of a series of contracts, and it does not lose its inter national character merely because one contract or a series of contracts is to be performed entirely within the territory of the same State,"

Rule 30 containing the three clauses is as hereunder :‑

"30(1) In the case of carriage to be performed by various successive carriers and falling within the definition set out in sub‑rule (4) of rule 1, each carrier who accepts passengers, baggage or goods is subjected to the rules set out in this Schedule, and is deemed to be one of the contracting parties to the contract of carriage in so far as the contract deals with that part of the carriage which is performed under his supervision.

(2) In the case of carriage of this nature, the passenger or his repre sentative can take action only against the carrier who performed the carriage during which the accident or the delay occurred, save in the case where, by express agreement, the first carrier has assumed liability for the whole journey.

(3) As regards baggage or goods, the passenger or consignor will have a right of action against the first carrier, and the passenger or consignee who is entitled to delivery will have a right of action against the last carrier and further, each may take action against the carrier who performed the carriage during which the destruction, loss, damage or delay took place. These carriers will be jointly and severally liable to the passenger or to the consignor or consignee."

Another fact, a very relevant one for deciding this issue, was an admission in the plaint (para. 3) itself that on 1‑11‑1981 the plaintiff was informed on telephone by the appellant's agent that the parcels had been delivered to the consignee. The exact words are as hereunder :‑

"That the plaintiff vide their Letter No. HB‑166/81, dated 1‑11‑1981, addressed and sent, under Registered Cover to Messrs B. N. S. Air Services Ltd., Paris Road, Sialkot City‑Defendant No. 2, and enquired from them about the fate of the parcels, as mentioned above. In reply to it the defendant No. 2 informed the plaintiff on telephone that the parcels in question had been delivered to the consignee."

With the disclosure of these facts, i.e. the date 1‑11‑1981 and the fact of delivery of consignments, the plaintiff could not remain in any doubt that the consignment had reached the destination on or before 1‑11‑1981,

This period for carriage by air will also appear to be reasonable time fact which came to the notice of the plaintiff, and this was independently of the appellant, was that the consignee did not accept the consignment. There was, in other words, refusal on the part of the consignee to take delivery of the consignments. Now the question is that did such a refusal by the consignee oblige the appellant under the Contract to inform the plaintiff of the refusal and whether appellant's failure to so inform the plaintiff extends or enlarges the period of limitation fixed by rule 29, Clause 11 of the Contract of Carriage provided as follows

"The notice of arrival of goods will be given promptly to the consignee or to the person indicated on the face hereof as the person to be notified. On arrival of the goods at the place of destination subject to the acceptance of other instructions from the shipper prior to the arrival of the goods at the place of destination, delivery will be made to or in accordance with the instructions of the consignee, If the consignee declines to accept the goods or cannot be com municated with, disposition will be in accordance with the instructions of the shipper."

The concluding portion of this clause does not affect the period of limitation. It reiterates or incorporates the right of the consignor as contained in rule 12(4) in the following words :‑

"The right conferred on the consignor ceases at the moment when that of the consignee begins in accordance with rule 13. Nevertheless if the consignee declines to accept the air way bill or the goods, or if he cannot be communicated with, the consignor resumes his right of disposition."

The decision of this Court in Abdul Jalil Chowdhry's case is relevant because it highlights the legal principle which accounts for extension of period of limitation where the statute (Article 31 of Limitation and clause 6 of Article III of Schedule to the Carriage of Goods by Sea Act) has similar or identical language. The principle is expressed in following words:

" . . . . but all these decisions can be shown to be correct on the ground that in these cases there was correspondence going on between the carrier and the consignee, and the carrier was willing to give and the consignee was willing to take delivery, so that there was impliedly an extension of time till there was refusal to give delivery or expression of inability to do so."

In the case in hand there was no extension, either explicit or implied. On the contrary, the plaintiff on his own showing had been informed early as 1‑11‑1981 that the packages had reached the destination/consignee. There was thereafter no modification, alteration or change in the position on the part of the appellant or its agents.

Another decision which merits mention here is from Indian jurisdiction, Boota Mal v. Union of India (A I R 1962 S C 1716.). It first enunciates the principle of interpretation applicable to statutes of limitation in the following words :‑

"Under the Article, the time begins to run "when the goods ought to be delivered" and one should have thought that there would be no difficulty in finding out the meaning of these words. Ordinarily, the words of a statute have to be given their strict grammatical meaning and equitable considerations are out of place, particularly in provisions of law limiting the period of limitation for filing suits or legal proceedings. This was laid down by the Primary Council in two decisions in Nagendranath v. Suresh Chanda A I A 1932 P C 165 and General Accident Fire and Life Assurance Corporation Ltd. v. Janmahomed Abdul Rahim A I R 1941 P C 6."

It next takes note of conflicting judgments of the High Courts in the words that follow :‑

"Two lines of reasoning seem to have governed the decisions of various High Courts on the interpretation of these words in the third column of Article 31. The first is based on the consideration that it was for the railway to prove what time ought to be taken for the delivery of the goods and, therefore, limitation can only start when the railway says finally that it cannot deliver the goods The second line of reasoning seems to be based on the principle of estoppel and is to the effect that where the railway enters into correspondence and says that efforts are being made to trace the goods the railway would be estopped from pleading that the time began to run from sometime anterior to the period before the correspondence on the question came to an end. It may however be noted that though the majority of the decisions follow these two lines of reasoning and hold that time begins to run only when the railway finally refuses to deliver the goods here and there a dissentient note bas also been struck."

The conflict was resolved by deciding as hereunder :‑

"Therefore, when we consider the interpretation of these words to the third column with respect to the case of non‑delivery they must mean the same thing, namely, the reasonable time taken for the carriage of goods from the place of despatch to the place of destina tion. The view. therefore, taken by some of the High Courts that the time begins from the date when the railway finally refuses to deliver cannot be correct, for the words in the third column of Article 31 are incapable of being interpreted as meaning the final refusal of the carrier to deliver."

And further that :‑

"Nor do we think that there could be generally speaking any question of estoppel in the matter of the starting point of limitation because of any correspondence carried on between the carrier and the person whose goods are carried. But undoubtedly, if the correspon dence discloses anything which may amount to an acknowledgment of liability of the carrier that will give a fresh starting point of limitation. As we have said already, the words in the third column refer to reasonable time taken for the carriage goods from the place of despatch to the place of destination and this reasonable time generally speaking cannot be affected by the subsequent conduct of the parties."

Taking an overall view of the facts of the case it is clearly established that the plaintiff was unequivocally informed on 1‑11‑198of the arrival of the Goods at the destination. On the part of the appellant there was n change in this statement of facts even upto the stage of bearing of appeal in this Court, where both the parties were allowed to file such documents as they considered necessary and in response they did file the documents to supplement their respective claims. Further, established is the fact that the consignee was informed of the arrival of goods at the destination and he refused to take delivery. He had reasons for that. The contention of the learned counsel for plaintiff‑respondent that the plaintiff had certain rights over the goods, which right got interrupted only when, the right of consignee started is true and borne out by rules 12 and 13 but to contend on its basis that starting point of limitation prescribed by rule 29 got extended till the refusal was communicated by the carrier is not correct. The date when "the aircraft ought to have arrived" being not in dispute in this case, the time started to run from 1‑11‑1981 and two years came to an end on 1‑11‑1983. The right to claim damages got extinguished there after. The suit instituted on 29‑9‑1984 was time‑barred. This appeal is, therefore, allowed with costs, the judgment of the two Courts is set aside and the suit of the plaintiff‑respondent is dismissed as time‑barred.

M. B. A, Appeal allowed.

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