Delaurier v Wyllie
| Jurisdiction | Scotland |
| Judgment Date | 30 November 1889 |
| Date | 30 November 1889 |
| Docket Number | No. 27. |
| Court | Court of Session |
Lord Trayner. M. Lord President, Lord Mure, Lord Shand, Lord Adam, Lord M'Laren, Lord Kinnear, Lord Wellwood, Lord Kyllachy, Lord Justice-Clerk, Lord Young, Lord Rutherfurd Clark, Lord Lee.
Ship—Contract—Charter-party—Bill of lading—Insurance—Reference to charter-party—Sale at a price including cost, insurance, and freight to a certain port.—
A & Co., a firm of merchants in France, wrote to B, a merchant in Glasgow, that they were willing to become buyers of a cargo of 1000 tons of coal when he found a steamer of that capacity. The latter made an offer to supply the quantity at a certain price per ton, including cost, insurance, and freight to Rochefort, which was accepted. B then chartered a steamer in his own name for the carriage of the coal, and at the buyers' request stipulated for the option of sending 30 tons of iron in addition.
B put the coals on board, along with 30 tons of iron which he had bought as agent for A & Co.
The charter-party contained a clause exempting the shipowners from liability for loss arising from dangers of navigation, even when caused by the negligence of the master or crew.
B got two bills of lading in his own name—that for the coal exempted the shipowners from liability for accidents of navigation (no mention being made of negligence), and bound the shipowners to deliver ‘on being paid freight, all other conditions as per charter.’
The bill of lading for the iron was in similar terms, except that it made no reference to conditions in the charter-party.
B insured the coals and iron in his own name, and in name of all to whom the same might appertain, for sums exceeding the invoice prices.
On the day on which the steamer sailed B sent to A & Co. the bills of lading indorsed to them, and also the charter-party.
The steamer was lost with the cargo through the negligence of the master or crew.
B recovered the sums insured and credited A & Co. with the invoice prices of the coal and iron.
A & Co., in the interest of the insurers, raised an action in their own name against the shipowners for damages for failing to deliver the cargo in terms of the bills of lading.
On the question as to the cargo of coals—(1) Held by the whole Court (diss. Lord Young) that the coals became the pursuers' property on shipment or indorsement of the bill of lading, as the seller's obligation to pay insurance and freight did not imply a suspension of delivery till the port of arrival, and that the pursuers had therefore a title to sue.
(2) Held by Lord President, Lord Justice-Clerk, Lords Mure, Shand, Adam, Rutherfurd Clark, M'Laren, Kinnear, Trayner, Wellwood, and Kyllachy, that the shipowners were liable under the bill of lading, notwithstanding the words ‘all other conditions as per charter,’ as they could not be construed as importing the negligence clause, but only conditions prestable by the consignee.
Lord Lee diss. on the ground that the negligence clause was imported by reference into the bill of lading, and further that the seller had chartered the vessel as agent for the pursuers.
On the question as to the cargo of iron—(1) Held by the Lord Justice-Clerk, Lords Mure, Shand, Rutherfurd Clark, Lee, M'Laren, Kinnear, and Kyllachy, that the iron was bought by the charterer as agent for A & Co., and that, in stipulating for and exercising the option to carry iron in the charter-party, he acted as the pursuers' agent, and subjected them to the conditions of the charter-party; that even if the charterer was thus acting in his own right, the shipowners, in receiving shipment of the iron from him, were entitled to assume that it was subject to the conditions of the charter-party, and that if the charterer shipped the iron for undisclosed principals, the latter were subject to the same conditions, and the subsequent granting of the bill of lading to the charterers and its indorsation to A & Co. gave A & Co. no independent right to damages from the shipowners.
(2) Held by Lord Young in concurring, that the shipowner having validly stipulated for exemption from liability for the negligence of master and crew, and the charterer having insured against that risk, the underwriters had no claim against the shipowners except as in right of the charterer, and were not entitled to sue in name of the pursuers, with whom they had no contract, for the purpose of depriving the shipowners of the benefit of the stipulation in the charter-party.
The Lord President, Lords Adam, Trayner, and Wellwood dissented, holding that the owner of the iron was entitled to delivery on fulfilling the conditions of the bill of lading, which was the only contract between him and the shipowner.
Delaurier & Company, merchants, Angoulême, raised an action against James Wyllie and others, Glasgow, owners of the steamer ‘George Moore,’ for payment of £500 as damages for failing to deliver at Rochefort sur-la-Mer in terms of two bills of lading held by the pursuers as indorsees (1) 1056 tons of coal, and (2) 30 tons of Eglinton pig-iron, shipped at Troon on board the said vessel, which was lost at sea.
The action was raised in the following circumstances:—For some years before 1887 the pursuers had had numerous transactions in buying coals for shipment to Rochefort from D. M. Stevenson & Company, merchants, Glasgow. On 21st April 1887 the pursuers wrote to Stevenson & Company,—‘We will be buyers of a cargo per steamer of about 1000 tons, ready to load during second fortnight of May. You can make us an offer when you have a steamer in view of this capacity ready to load at that time.’
On 25th April Stevenson & Company wrote to the pursuers offering by steamer 1000 tons of coal at 10s. 3d. per ton. This price was to include cost, insurance, and freight to Rochefort.
On 27th April the pursuers wrote in reply,—‘We have your favour of 25th inst., and have wired you “we accept.”
‘We are consequently agreed for a cargo of large Scotch coal. … Delivery by steamer of 800/1000 tons ready to load and sail 2d fortnight in May.’
On 6th May the pursuers wrote to Stevenson & Company,—‘Per steamer coming for us we would like to get 30 to 50 tons Eglinton No. 3 pig-iron. Please say if you would prefer to sell such at a firm price c.i.f. Rochefort, or buy for our account, charging us the usual commission of 1 per cent on invoice price, the freight and insurance being also at our expense.’
Stevenson & Company, on 9th May, wrote in reply,—‘We have your favour of 6th inst., and shall buy your pig-iron at 1 per cent commission with pleasure.’ And also on 11th May,—‘We beg to advise the chartering of s.s. “George Moore,” which will load for you about the 20th inst. at Troon with London diamond, cargo about 1000 tons.
‘We await your news regarding the iron in the event of your requiring it. Option at the freight of 5·60 francs.’
On 13th May the pursuers wrote,—‘We have your favour of 11th inst., and due note is taken of chartering of “George Moore” to load for us about 20th inst.
‘As instructed, you will buy 30 tons pig-iron, Eglinton No. 3, and load it on board the “George Moore.”’
In anticipation of having to send the coal, Stevenson & Company had arranged to charter the ‘George Moore’ from the defenders, and on 11th May they entered into a charter-party for that vessel with them. By the charter-party it was agreed that the ‘George Moore’ should proceed to Troon, and there receive a full cargo of coals, and should therewith proceed in accordance with orders to be received on signing bills of lading to La Rochelle, Rochefort, Charente, or St Nazaire, and there deliver her cargo on being paid freight at 4 fr. 60 cent. per ton.
The charter-party further bore ‘clean bills of lading to be signed by the master as presented at the office of charterers or their agents without prejudice to this charter; if at a lower rate of freight than above named, the difference to be paid to him before sailing; if at a higher rate, the surplus to be indorsed as an advance. … In charterers' option, to load up to 100 tons pig-iron at 1 franc per ton above coal rate. … It is agreed that the following additional exceptions and conditions shall apply to this contract. The act of God, perils of the sea, fire on board in hulk or craft, or on shore, barratry of the master and crew, enemies, pirates, and thieves, arrests and restraints of princes, rulers, and people, collisions, stranding and other accidents of navigation excepted, even when occasioned by negligence, default, or error in judgment of the pilot, master, mariners, or other servants of the shipowners. …’
On 19th May D. M. Stevenson & Company shipped on board the ‘George Moore’ 1056 tons of coal. The bill of lading bore,—‘Shipped in good order and well-conditioned by D. M. Stevenson & Company, whose responsibility ceases on the present being signed, in and upon the good steamship “George Moore,”… a part cargo, consisting of 1056 tons coals, to be delivered in like good order and condition at the aforesaid port of Rochefort, where the vessel is to be addressed to charterers' agent (the act of God, the Queen's enemies, fire, and all and every other dangers and accidents of the seas, rivers, and navigation of whatever nature and kind soever excepted) unto order, on being paid freight at the rate of (4 f. 60 c.) four francs sixty centimes per ton of 20 cwts. delivered, all other conditions as per charter, dated 11th May 1887. …’
The bill of lading for the iron was in similar terms, except that it did not contain the words ‘all other conditions as per charter, dated 11th May 1887.’
D. M. Stevenson & Company had an open policy of insurance for £40,000 with insurers in Glasgow, and on 20th May they declared on it to the extent of £62 on the iron, £385 on the coals, and £66 on the advance freight—the total sum insured being £513, and obtained a special policy applicable to the goods, whereby they were insured ‘as well in their own name as for and in the name and names of all...
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