The Malaysian Court of Appeal addressed key issues in the case of Cosco Container Lines Co Ltd and another v. Trengganu Forest Products Sdn Bhd, which centered on alleged fraudulent misrepresentation in a bill of lading. The case highlighted critical points concerning liability, limitation periods, and the evaluation of documentary evidence.
The dispute arose when Trengganu Forest Products contracted with Cosco for shipping plywood to Hebei Metal & Minerals. The bill of lading stated the cargo was shipped on April 30, 1994, directly to Xingang Port, China. However, it was later discovered that the cargo was discharged in Hong Kong and transshipped to its destination. The buyer obtained an injunction, alleging fraud, and arbitration awarded damages to the buyer. Trengganu sought compensation from Cosco for the losses incurred.
The High Court found Cosco liable for fraudulent misrepresentation, awarding damages of $1,446,469.58. However, Cosco appealed, raising two primary arguments. First, they contended that the claim was time-barred under the Carriage of Goods by Sea Act’s one-year limitation period. Second, they argued that the trial court failed to consider key documents (Exhibits P4 and P37), which indicated that Trengganu’s own amendments to the bill of lading contributed to the discrepancies.
The appellate court ruled that the limitation period issue had been resolved in earlier proceedings in favor of Trengganu. However, it found that the High Court erred by disregarding contemporaneous evidence showing Trengganu’s role in altering the shipment details. The Court of Appeal concluded that the evidence did not substantiate Trengganu’s claims of misrepresentation and allowed Cosco’s appeal, awarding costs to the appellants.
This decision underscores the importance of thoroughly evaluating documentary evidence in cases of alleged fraud and reinforces procedural clarity in maritime contract disputes.
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