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clr/1988/1988_1_117.pdf

1CUR. 1988February 25 (MALACHTOS.J.) PERICLESCHIMONIDES, Plaintiff, v. 1.UNIONINSURANCESOCIETYOFCANTONLTD., 2. GLYKYSBROTHERSLTD., ' Defendants. (AdmiraltyAction No. 93/79). 5 ' 10 Admiralty— Writof Summons —Service of— Defendants out of the Jurisdiction—Leave obtained ex parte to serve such defendants (defendants 1 in this action) by leaving a copy with their Claim Settling Agents in Cyprus (defendants 2)—Latter's authority did not includeacceptance ofjudicialprocess —Application tosetaside suchservice on thefirstdefendants — Granted. Admiralty —Marine insurance policies issued abroad by the first defendants —Action based on such policies —As such policies were not issued by the second defendants (who were the Claim Settling Agents in Cyprus of the first defendants with limited authority) eitherpersonally orasagents of the firstdefendants, the actionasagainstthem has tobe dismissed. The facts of this case appear sufficiently in the judgment of the ' Court. 15 Application to set aside service of writof summons on the nrst defendants - granted. Action against the second defendants dismissed.Costsagainstplaintiff. 20 Application. Application by defendant for a n order of the Court that the service of the writ of summons and/or the action be set aside. A. Markides, forapplicants - defendants. 117 CUmoaldcev.UnionInsurance

(1988)G Arestis for Ρ L Cacoyannis & Co for the respondent plaintiff. Cur adv vult MALACHTOSJ read thefollowing judgment Inthisactionthe plaintiff/respondent on the 12th Apnl, 1979, instituted legal proceedings before thisCourtinitsAdmiralty Jurisdiction claiming against the defendants/applicants. 5 (a)US Dollars$33,137.50 (oritsequivalent inCyprus pounds)or thereabouts, being the insured value of a cargo of 62 cartons containing 20 500 yards 100% CottonCorduroy 10 material, 30 cartons containing 9 466 yards Polyester/Cotton Corduroy matenalKand 15 cartons containing 4 558 yards 100% Cotton Corduroy material, 15 shippedby theWai CheongCompanyof HongKong,Rm903,Po Sang Bank Bldg No33,ArgyleStreet, Kowloon, on board theS/ S «EVER HANDSOME»on or about 7 10 1978 for carnage from Hong Kong to Limassol Cyprus, and delivery thereof to the Plaintiff payable by the Defendantstothe Plaintiff undertheterms 20 of three Manne Insurance Policies Nos. KSDO/0008, KSDO 78/ 0009, KSDO 78/0010, all dated 2 10 1978, issued by the Defendants through theirHongKongAgents inwhich policies the Plaintiff was at all matenal times fully interested, such cargo of Corduroy matenal having been totally lost and/ordestroyed and/ 25 orstolenand/ornever delivered tothePlaintiff and/or otherwise, (
  1. b)A declaration that the goods as descnbed in the Policies referred to in relief (
  2. a)above, were the goods as so descnbed therein namely cotton corduroy matenal (100% cotton, or polyester/cotton as the case maybe) which were so insured from 30 warehouse towarehouse andshipped atHongKong(after leaving the supplier' s warehouse) per S/S «EVER HANDSOME» on or about 7th October, 1978 and that the Defendants should not be heard to say or that they be estopped from saying that the said goods were goods other than the goods so descnbed in the said 35 policies, (
  3. c)Alternatively to (
  4. a)and (
  5. b)above, the same amount as is claimed in (
  6. a)above by way of damages for negligence, and/or negligent misstatement and/or for fraud and/or for misrepresentation and/orfor deceit orotherwise infalsely and/or 40 negligently and/or fraudulently representing, by the issue of the said policies, to be insunng the goods as so descnbed therein 118 5 1G1~R. Chlmonlde»τ.UntooInsurance MalachtoeJ. whereas in truth and in fact what was so insured was not the goods so described but rubbish, such goods never having left the supplier's warehouse and never been shipped per S/S «EVER HANDSOME», the Plaintiff having relied on such representation thereby suffering damage; and/or (d)Thesame amountby way of damages for conspiracyand/or breach of contractand/orfor negligence and/orfor fraud and/or otherwise; (
  7. e)Interest and costs. 10 At thesame time, theplaintiff by anex parteapplication, based, as stated therein, on Rules 20, 23, 24 and 25 of the Cyprus Admiralty Jurisdiction Order 1893 and Order 5, rule 7, of the Civil Procedure Rules, applied and obtained an Order for leave to serve the writ of summons on defendant'No. 1 by leaving a 15 copy thereof with the Claim Settling agents of this defendant in Cyprus, Messrs. Glykys Brothers Ltd. of Nicosia, who are defendant 2 in the action. On the 30th June, 1979, the appointed day, the defendants appeared before the Court and on their application were given 20 leave to enter a conditional appearance, as they intended to apply to set aside the issue and services of the writ. On the 28th day of August, 1979, the defendants filed an application based, as stated therein, on the Cyprus Admiralty Jurisdiction Order 1893, Rules 21,23, 24, 25, 203, 207 arid 208 25 and on sub paragraph (
  8. a)of section 19 of the Courts of Justice Law of 1960, Law 14/60 andontheGeneralLaw andtheinherent jurisdiction of the court claiming, as stated therein, the following remedies:1.An orderof the Courtthattheservice of theWritof Summons 30 and/or the Action on the First of the above Applicants be set aside and/or that the poroceedings as against them be set aside on the following grounds, namely:(
  9. a)The service of the Writ of Summons and/or copy thereof on the First Defendants could not and was not properly effected 35 by serving the same on the Second Defendants. (
  10. b)The action against the Second Defendants, who are the only parties within the Jurisdiction, must plainly fail, and consequently the Honourable Court has no Jurisdiction to entertain the matters complained of. 119 t. MalachtoaΛ. CMmonMe»v. Union Insurance
(1988)
  1. An Order of the Court that the Service of the Writ of Summons and/or the Action on the Second DefendantsApplicants and/or the proceedings against them be set aside for lack of Jurisdiction by the Honourable Court. Paragraphs 2 to 5 of the affidavit in support of the application 5 sworn by Evelthon Glykys, a Directorof the second defendants, a company formed and incorporated in Cyprus, with limited liability under the Companies Law, Cap. 113, read as follows: «
  2. By a letter dated 30.11.1969 the 'Institute of London Underwriters' appointed the Second Defendants as 'Claim 10 Settling Agents'. Photocopyof this letterisattached herewith marked Exhibit A%
  3. One of the members of the 'Institute of LondonUnder writers' are 'The Union Insurance Society Of Canton Ltd.,' i.e. the First Defendants.
  4. The Second Defendants did not have and do not have any agents in Hong Kong.
  5. The Second Defendants did not issue either directly or indirectly any of the Insurancepolicies referred to intheWrit of Summons. Indeed and in respect of the matters 20 complained of by the Plaintiff Pericles Chimonides no contractual relationship ever existed as between the said Plaintiff and the Second Defendants.» Counsel for applicants in arguing his case made reference to the letter of appointment of the second defendants as claim 25 settling agents in Cyprus by the Instituteof London Underwriters, particularly paragraphs 8and 12thereof, which readas follows:
(8)Heavy or Unusual Claims All claims exceeding £1,000 (or equivalent) must be submitted to the Institute,or in the case of Companies Own 30 Policies, totheCompanyconcerned,priortosettlement,with the further proviso that all unusual claims must also be submitted for approval. When forwarding to the Institute claims that you have not settled you should give a brief indication of your reasons for withholding payment. 35
(12)JudicialProceedings, Arbitration etc. Your appointmentas Claim Settling Agents does not carry 120 1CUR. 5 10 Chlmonldes v.Union Insurance Malacbtos J. with it any Power of Attorney and your authority does not extend to the acceptance on behalf of the subscribing Companies of Service of any Judicial proceedings, Noticeof Appointment ofArbitrators orNoticeofArbitration inrespect of which itwill be necessary to obtain specific instructions in each casefrom thisInstitute(orfrom theCompany concerned -in the case of Companies own policies). Similarly, abandonment must not be accepted on Underwriters behalf unless express agreement is first obtained through this Institute orthe Company concerned». Counselforapplicantssubmittedthatitisclearfrom theletterof appointment of defendants 2 that no proper service could be effected onthesaiddefendants eitherintheirpersonal capacityor as agents of defendants No.l. He also submitted that even if we 15 assume that defendant No.2 isthe agent of defendants No.1then in the present case the service isbad in law as defendants 1are carryingonbusinessabroadandthecontractofinsurancewasalso concluded outside thejurisdiction of thisCourt.Thisisclear from the provisions of Order 10, rule 2,of the Rules of the Supreme 20 Court inEngland before 1960, which areapplicable in Cyprus. From the affidavits' in support of the application and the opposition and the other evidence adduced, it is clear that defendants No.2 are special agents of the London Underwriters asclaimsettlingagentswithverylimitedauthority,whichdoesnot 25 carry with itany power of attorney and does not extend, among other things, to the acceptance of any judicial proceedings. The three marine insurance policies on which the action is based, which were issued at Hong Kong outside the jurisdiction of this Court on 2.10.78, were not issued by defendants 2 either 30 personally or as agents of defendant No.l as alleged by the plaintiff respondent. So,the present application should succeed. Inthe result, itishereby ordered thattheservice and the writof summons on both defendants be set aside and the action against the2nd defendants bealso dismissed. 35 On the question of costs, the plaintiff respondent isordered to paythecostsofthisapplication totheapplicantstobeassessedby the Registrar on the scale applicable on the date of the hearingof the application. • , ---Order accordingly. 121

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