C OMME R C IA L

LAW
Dr Faiza Ismail
 EXAM SKILLS

What is the purpose of open book exam?

How do we plan to write an exam or attempt
problem questions?
How to write answers to problem questions?
What is an instructor looking for while marking
a scenario-based exam?
 THE PIONEER CONTAINER (1994)

1. Was there a contract of bailment between parties?

2. Was there a sub-bailment?
3. Which party is bailor, bailee and sub-bailee?
4. What is a jurisdictional clause?
5. Plaintiffs, the cargo owners did not want to bring proceedings in
Taiwanese court for two reasons. What are those reasons?
6. What did the court hold and what are the reasons underlying the
judgment?
 THE PIONEER CONTAINER (1994)
 Appellants plaintiff are cargo owners. Appellants plaintiff Hanjin shipped goods for transportation from the
US-HK.
 Appellants plaintiff Scandutch shipped good for transportation from HK-Europe/Middle East.
 Both the plaintiffs made contracts with freight carriers. Hanjin’s contracts included clause 6 and Scandutch’s
contract clause 4(1) which allowed freight carriers to make sub-contract.
 These contracts also included a jurisdictional clause 26 which mentioned Hong Kong as a place of jurisdiction.
 The freight carriers subcontracted the goods to respondent who is shipowner. The sub-contract included a
jurisdictional clause which mentioned Taiwan as a place of jurisdiction.
 Hanjin’s and Scandutch’s goods were shipped in respondent’s ship called KH Enterprise which collided and
sank in Taiwaneses port.
 Plaintiffs brought a claim in Honk Kong court whereas respondent applied for stay of proceedings in Hong
Kong because respondent claimed Taiwanese court had jurisdiction over this case.
 Plaintiffs did not want to bring proceedings in Taiwanese court for two reasons. What are those reasons?
 THE PIONEER CONTAINER

Court held:
Bailor (Cargo owner) was entitled to sue the
sub-bailee- consent in contract I.
Bailor (Cargo owner) and sub-bailee were
bound by the terms of contract II. Taiwan
was the place of jurisdiction
 BAILMENT AND THIRD PARTY
 Sub-bailment and the bailor
 Sub-bailment and the sub-bailee
 Sub-bailment and the bailee
 Sub-bailment and the bailor
 Is bailor bound by terms of sub-bailment?
 The Pioneer Container- goods owner was bound by the sub-
bailment’s exclusive jurisdiction clause.
 Owner expressly or impliedly consented to the sub-
bailment.
 Sub-bailment and the bailor
Can bailor invoke the terms of sub-bailment for its
benefit ?
1. Bailor authorized the sub-bailment.
2. Bailee and sub-bailee purports to serve the bailor's
benefit such as
Subcontractor failed to comply with standard
temperature agreed with the bailee.
Bailor is entitled to bring an action against sub-
bailee for recovery 
 SUB-BAILMENT AND THE SUB-BAILEE

 Terms of sub-bailment directly applies and takes precedence

over bailment such as exclusive jurisdiction clause in the
contract 2 in The Pioneer Container.
SUB-BAILMENT AND THE BAILEE

 Bailee is liable for the faults and failures of sub-bailee.

 Bailee will have right to indemnify against sub-bailee.