Transnet National Ports Authority (TNPA) is facing a US$110 million (over R1.83 billion) lawsuit stemming from the grounding of the cargo vessel MV Smart at the entrance of Richards Bay harbour more than a decade ago.
The vessel ran aground in August 2013, resulting in the loss of both the ship and its cargo. The owners and underwriters of MV Smart are seeking to recover damages from TNPA, alleging that the loss was caused by negligence on the part of the Transnet subsidiary.
Multiple Claims Linked to 2013 Incident
In addition to the primary claim by the vessel’s owners and underwriters, TNPA is also facing two further lawsuits:
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A claim by the charterer, Minmetals Logistics Zhejiang Co. Ltd
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A claim by the cargo interests, relating to the loss of coal carried by the vessel at the time of the grounding
Together, the claims expose the ports authority to potential liabilities running into billions of rand.
Court Proceedings in Durban
Details of the multi-million-dollar litigation emerged in the KwaZulu-Natal High Court in Durban, where TNPA applied for an order compelling the owners and underwriters of MV Smart to disclose documents and correspondence related to the incident.
The disclosure is linked to civil proceedings set to commence in July next year, with the trial expected to run for more than four weeks.
London Arbitration Also Under Scrutiny
Separately, the owners and underwriters of MV Smart have initiated arbitration proceedings in London against Minmetals Logistics Zhejiang Co. Ltd, seeking substantially the same damages claimed from TNPA.
As part of its defence, TNPA sought access to documentation from those arbitration proceedings, arguing that they are relevant to the South African litigation.
Earlier this week, Judge Peter Olsen ordered the owners and underwriters to produce a wide range of documents within 15 days of his ruling handed down on Monday, December 22.
Documents Ordered to Be Disclosed
The court ordered the production of, among others:
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Final pleadings, including requests for particulars and replies
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Statements by factual witnesses relied upon in the arbitrations
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Statements and reports of expert witnesses, including electronic presentations
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Full transcripts of the arbitration proceedings
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Written submissions by counsel, including opening and closing arguments
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Arbitration awards, including interim and final awards
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Applications for leave to appeal and any related judgments or orders
Judge Olsen further directed the owners and underwriters to file a supplementary discovery affidavit covering relevant correspondence — excluding genuinely “without prejudice” communications — exchanged between the owners, charterers and cargo interests relating to the casualty.
The obligation to disclose correspondence will be assessed in line with the court’s findings on privilege and confidentiality, given the private nature of arbitration proceedings.
TNPA Denies Liability
TNPA has denied responsibility for the loss of the vessel and cargo, maintaining that the grounding was caused by negligence on the part of the vessel’s master and crew, alternatively contributory negligence.
The ports authority has also instituted third-party proceedings against the vessel’s owners, seeking a conditional order declaring them joint wrongdoers in relation to the losses suffered.
Role of TNPA
TNPA operates as South Africa’s port landlord authority, managing eight commercial seaports:
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Saldanha Bay, Cape Town and Mossel Bay (Western Cape)
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Gqeberha, Ngqura and East London (Eastern Cape)
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Durban and Richards Bay (KwaZulu-Natal)
A ninth port, Port Nolloth in the Northern Cape, is leased to De Beers Consolidated Diamond Mines and does not handle commercial cargo.
TNPA is responsible for port infrastructure, marine services and the control of port navigation, ensuring that the national port system operates safely, efficiently and effectively.
