Clarke v Lord Dunraven. The Satanita
| Jurisdiction | UK Non-devolved |
| Court | House of Lords |
| Judgment Date | 29 March 1895 |
| Date | 29 March 1895 |
Admiralty - Collision - Damages - Contract overriding Limitation of Liability -
Two yachts were entered by their respective owners for a club race, each owner undertaking with the club to be bound by the club sailing rules. By the rules the owner of any yacht disobeying any of the rules was to be liable for “all damages arising therefrom.” One of the yachts in breach of a sailing rule, through improper navigation without the actual fault or privity of the owner, ran into and sank the other yacht: —
Held, that there was a contract between the owners upon which the owner of the damaged yacht could sue the owner of the other, and that upon the true construction of the rules the words “all damages” excluded the operation of s. 54 of the Merchant Shipping Act Amendment Act 1862 which limited the liability to 8l. per ton.
THIS Mudhook Yacht Club having advertised a regatta to be held on the Clyde in July 1894, the appellant entered his yacht the Satanita, and the respondent entered his yacht the Valkyrie, for a first-class race in the regatta, each owner signing a letter to the secretary of the club undertaking that while sailing under the entry he would obey and be bound by the sailing rules of the Yacht Club Association. Those rules contained a number of regulations to be observed in races, and among them rule 18 which corresponded to art. 14 of the Regulations for Preventing Collisions at Sea. By rule 24, “…. If a yacht, in consequence of her neglect of any of these rules, shall foul another yacht, or compel other yachts to foul, she shall forfeit all claim to the prize, and shall pay all damages.” By rule 32, “Any yacht disobeying or infringing any of these rules, which shall apply to all yachts whether sailing in the same or different races, shall be disqualified from receiving any prize she would otherwise have won, and her owner shall be liable for all damages arising therefrom.”
While sailing under the entry the Satanita, without the actual fault or privity of the owner, broke the 18th rule and ran into and sank the Valkyrie. The respondent and the master and crew of the latter vessel brought an action in the Admiralty Division against the appellant claiming damages. The appellant paid into court a sum as the amount of damages for which he was answerable under the Merchant Shipping Act Amendment Act 1862 c. 63 s. 54F1, calculated at the rate of 8l. per ton on the registered tonnage of the Satanita. Bruce J., before whom the action was tried, held that even if there was a special contract binding the appellant, the words in the rules “all damages” were not so express as to override the statutory limitation. The Court of Appeal (Lord Esher M.R., Lopes and Rigby L.JJ.) reversed this decision, holding that as against the respondent the appellant was not entitled to limit his liability, and condemned him in the damage proceeded for by the respondent and in costs.F2
The defendant brought the present appeal.
Nov. 13, 16. Sir R. T. Reid, Q.C., and E. H. Pollard, for the appellant. By the Merchant Shipping Act Amendment Act 1862 c. 63 s. 54 the owner of any ship — where without his actual fault or privity any loss or damage is by reason of the improper navigation of the ship caused to any other ship, goods or merchandise thereon — shall not be answerable in damages to an aggregate amount exceeding 8l. per ton of the faulty ship's registered tonnage. This limitation of liability was well known and long established when these Yacht Sailing Rules were drawn up, and must have been in the contemplation of the persons who drew the rules, as well as of the owners of yachts who race. Agreements as well as statutes are construed with reference to the existing state of the law, and where it is intended to waive a protection of the law very clear and express words must be used to shew the intention. Assuming that there was a contract between the appellant and respondent and that the contract was broken by the improper navigation of the Satanita, the contract must be construed with reference to the statutory limitation of liability, and there being no words shewing clearly an intention to waive the protection, the appellant is entitled to claim it. The words “all damages” mean any damages, all kinds of damages, the word being used in the plural, not in the singular. Liability in full might, it is said, attach in cases where the statute does not apply, for some breach of the sailing rules which does not amount to improper navigation; but a breach of the sailing rules would be evidence of improper navigation, and where the damage happens by “improper...
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Privity of Contract
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