N.W.L. Ltd v Woods
| Jurisdiction | UK Non-devolved |
| Judge | Lord Diplock,Lord Fraser of Tullybelton,Lord Scarman |
| Judgment Date | 25 October 1979 |
| Judgment citation (vLex) | [1979] UKHL J1025-1 |
| Date | 25 October 1979 |
| Court | House of Lords |
[1979] UKHL J1025-1
Lord Diplock
Lord Fraser of Tullybelton
Lord Scarman
House of Lords
Upon Report from the Appellate Committee to whom was referred the Cause N.W.L. Limited against Nelson and another and N.W.L. Limited against Woods (Consolidated Appeals), That the Committee had heard Counsel as well on Wednesday the 25th as on Thursday the 26th days of July last upon the Petition and Appeal of N.W.L. Limited of Room 77, New Henry House, Ice House Street, Hong Kong praying that the matter of the Order set forth in the Schedule thereto, namely an Order of Her Majesty's Court of Appeal of the 3rd day of July 1979 might be reviewed before Her Majesty the Queen in Her Court of Parliament and that the said Order might be reversed, varied or altered or that the Petitioners might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament might seem meet; as also upon the Petition and Appeal of N.W.L. Limited praying that the matter of the Order set forth in the Schedule thereto, namely an Order of Her Majesty's Court of Appeal of the 21st day of June 1979 might be reviewed before Her Majesty the Queen in Her Court of Parliament and that the said Order might be reversed, varied or altered or that the Petitioners might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament might seem meet (which said Appeals were by an Order of this House of the 18th day of July 1979 ordered to be consolidated); as also upon the Case of John Nelson, Brian Laughton and James Woods lodged in answer to the said appeal; and due consideration had this day of what was offered on either side in this Cause:
It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Orders of Her Majesty's Court of Appeal (Civil Division) of the 3rd day of July 1979 and 21st day of June 1979 complained of in the said Appeals be, and the same are hereby, Affirmed and that the said Petitions and Appeals be, and the same are hereby, dismissed this House: And it is further Ordered, That the Appellants do pay or cause to be paid to the said Respondents the Costs incurred by them in respect of the said Appeals, the amount thereof to be certified by the Clerk of the Parliaments if not agreed between the parties.
My Lords,
In these consolidated appeals the plaintiffs ("the shipowners"), a Hong Kong company, all of whose shares are beneficially owned in Sweden, seek to prevent officials of the International Transport Workers' Federation ("ITF") from inducing port workers in England and elsewhere to "black" their vessel, the Nawala.
In an endeavour to stop the blacking before the damage had been done, they applied in each of the actions for interlocutory injunctions. In the first action, against the defendant, Woods, Donaldson J. granted an interlocutory injunction, thinking that the judgment of the Court of Appeal in The "Camilla M." [1979] 1 Lloyd's Rep. 26 compelled him to do so. This injunction was discharged by a Court of Appeal consisting of Lord Salmon and Stephenson L.J. In the subsequent action against the defendants Nelson and Laughton, Donaldson J. refused the shipowners' application and his refusal was upheld by a Court of Appeal consisting of Lord Denning M.R. and Waller and Eveleigh L.JJ. Against these two decisions of the Court of Appeal that the shipowners are not entitled to interlocutory injunctions, these appeals (now consolidated) have been brought to your Lordships' House by leave of the Court of Appeal.
The cases arises out of the threat by ITF that industrial action will be taken against the Nawala unless the shipowners conform to ITF's requirements as to the wages and conditions of employment of the members of its crew. ITF, which has its headquarters in London, is an international federation of national trade unions, in 85 different countries, representing transport workers of all kinds including seamen. As is well known in shipping circles and to the commercial judges, it has a policy as respects vessels which sail under what it describes as "flags of convenience"—an expression which it uses with a much extended meaning as covering all vessels that are registered in a country which is not the domicile of the beneficial owner of the vessel. That policy is described in detail in the judgment of the Court of Appeal in the action against Woods, and is placed in its worldwide perspective in the judgment of Donaldson J. in the action against Nelson and Laughton. It may be summarised as follows.
ITF endeavours to exert such "industrial muscle" as its affiliated national unions are prepared to exercise at its behest in order to compel the owners of vessels sailing under flags of convenience (in this extended sense) to employ their officers and seamen on terms of standard articles prepared by ITF and providing for wages at rates said to be the middle rates paid to ships' crews under collective agreements negotiated by national trade unions for ships on their national registries in European countries outside the communist bloc. An alternative way of buying off industrial action inspired by ITF is to change the vessel's flag by transferring its registry to that of the country of domicile of its beneficial owner, whereupon he will be obliged to negotiate terms of employment and wages of crews with the national seamen's union affiliated to the ITF. The ultimate aim is to abolish throughout the world the use by shipowners of flags of convenience as ITF defines them.
Your Lordships are in no way concerned with the economic wisdom or the moral justification of this policy. The evidence in the instant appeals confirms what the evidence in The "Camilla M." suggested, that the policy does not command the approbation of seamen and their national trade unions in those countries of Asia which have traditionally formed the recruiting grounds for many thousands of seamen eager to serve under articles that provide for wages which, although much lower than those demanded by their European, North American and Australasian counterparts, are, nevertheless, much higher than anything that they could hope to earn in land-based work in their own countries. Their competitiveness as candidates for manning the merchant navies of the world depends upon their cheapness. Their natural fear, as indicated by the evidence, is that if their competitiveness is reduced by forcing shipowners who employ them to pay to them wages at the middle rate paid to European seamen, their chances of sea-faring employment will be very much reduced. This readily accounts for the attitude taken up by the Indian crew in The "Camilla M." and by the Hong Kong crew in the instant case.
The history of the Nawala which led to her selection as a target of ITF's campaign against flags of convenience and the way in which that campaign has been carried on against her up to 3rd July 1979, are set out in such vivid detail in the judgment of the Master of the Rolls delivered on that date, that rather than repeat it in less readable style, I recommend reference to it direct and will restrict myself to stating in summary form such facts as are essential in order to identify the questions of law which fall to be decided by your Lordships. The Nawala did not, however, remain stationary while the lawyers were arguing about her; nor has she done so between 3rd July 1979 and the hearing in the Appellate Committee of the shipowners' appeal to this House. A further chapter to Lord Denning's saga of the Nawala must also be recounted briefly.
The Nawala is a large bulk-carrier with a capacity of more than 120,000 tonnes dwt. She was built in Germany in 1974 for Scandinavian shipowners and entered on the Norwegian registry. She was manned by a Norwegian crew at rates of wages that had been negotiated by their national trade union and are among the highest current in European countries. When the slump in the freight market came she was trading under the Norwegian flag but at a loss. Her owners were unable to meet the mortgage payments and sold her to buyers based in Sweden, who for the purpose of transferring her to Hong Kong registry formed a Hong Kong company of whose shares a Swedish company was beneficial owner. The Hong Kong company became the nominal owner of the vessel, and a Hong Kong crew was engaged at very much lower wages to take the place of the Norwegian crew. It was not necessary for the Nawala to visit Hong Kong in order to effect the change of flag or to engage the Hong Kong crew. The crew was engaged there by an agency that was officially licensed in the colony to do so. The crew signed their articles there and were flown to Hamburg where they joined the vessel.
The Nawala, under her new flag and manned by her new and much lower paid crew, was engaged by her new owners upon chartered voyages world-wide. Early in 1979 she had berthed at Redcar with a cargo of Australian iron ore for British Steel. A representative of ITF boarded her and demanded of the master that he sign on behalf of the shipowners an agreement with ITF that they would enter into articles with the crew on standard ITF terms. The demand was refused. When she arrived at Redcar on her next consecutive voyage with a similar cargo on 15th June 1979, Mr. Woods, who was an official of both ITF and the English National Seamen's Union, repeated the demand and said that if it were not complied with the Nawala would be "blacked" by the port workers. He and later Mr. Nelson and Mr. Laughton attempted to persuade port workers who belonged to other unions affiliated to ITF to refuse to allow her to enter her berth, to unload her if she got there or to let...
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