NOTES OF CASES
| DOI | http://doi.org/10.1111/j.1468-2230.1972.tb01327.x |
| Published date | 01 March 1972 |
| Date | 01 March 1972 |
NOTES
OF
CASES
VICARIOUS
IMMUNITY
BY
AN
ALTERNATIVE
ROUTE
WHEN,
in
Scruttons Ltd.
v.
Midland Silicones Ltd.,I
the House of
Lords decided that stevedores could not take the benefit of exception
clauses in contracts of carriage to which they were not parties and,
in
so
doing, rejected Scrutton L.J.’s principle of
“
vicarious
immunity,” they did at least leave open a possible alternative means
of attaining the same result by use of the principles of agency. Lord
Reid in particular went into the matter in some detail when he
said
:
‘‘
I
can see a possibility of success of the agency argument
if
(first) the bill of lading makes
it
clear that the stevedore is
intended to be protected by the provisions in it which limit
liability, (secondly) the bill
of
lading makes
it
clear that the
carrier, in addition to contracting
for
these provisions on his
own behalf, is also contracting as agent for the stevedore that
these provisions should apply to the stevedore, (thirdly) the
carrier has authority from the stevedore to do that,
or
perhaps
later ratification by the stevedore would suffice and (fourthly)
that any difficulties about consideration moving from the steve-
dore were overcome. And then to affect the consignee it would
be necessary to show that the provisions of the Bills of Lading
Act,
1855,
would apply.”
Clauses based on this type
of
reasoning have been appearing in
bills of lading since the decision of the Court of Appeal in
Adler
v.
Dickson
and one has been upheld in the United
state^.^
Now,
apparently for the first time, a Commonwealth court has been asked
to rule on the effect of such a clause. In
A.
N.
Satterthwaite
L$-
Co.
Ltd.
v.
New
Zealand Shipping
Co.
Ltd.,5
Beattie
J.
of the New
Zealand Supreme Court has held that the limitation provisions in
the bill
of
lading before him did have effect to protect stevedores
who had negligently caused damage while unloading goods consigned
under it.
Clause
1
of the bill of lading provided as follows
:
‘‘
It
is hereby expressly agreed that no servant or agent of the
carrier (including every independent contractor from time
to
1
[1962] A.C.
446.
2
Ibid.
at p.
474.
3
r19551
1
Q.B.
156. They a.re accordingly
known
as
“
Himalaya
”
clauses after
ehe ship
h
that case.
hs
to the pos&n of servants or agents
of
the carrier
under the Hague Rules, see
now
the Carriage
of
Goods by Sea Act 1971.
4
Cade
d
Montana~i
Inc.
v.
American
Ezport
Lines
Inc.
[1965]
1
Lloyd’s Rep.
260
(U.S.
District Court). That decision
was
subsequently upheld
on
appeal
(see
19691
2
Lloyd’s Rep.
640).
5
[I9715
2
Lloyd’s Rep.
399.
176
MAR.
1972
NOTES
OF
CASES
177
time employed by the carrier) shall in any circumstances what-
soever be under any liability whatsoever to the shipper,
consignee
or
owner of the goods
or
to any holder of this bill of
lading
for
any loss, damage
or
delay
of
whatsoever kind arising
or resulting directly
or
indirectly from any act, neglect
or
default on his part while acting in the course of
or
in connection
with his employment and, without prejudice to the generality
of the foregoing provisions in this clause, every exemption,
limitation, condition and liberty herein contained and every
right, exemption from liability, defence and immunity of what-
soever nature applicable to the carrier
or
to which the carrier
is
entitled hereunder shall also be available and shall extend to
protect every such servant
or
agent of the carrier acting as
aforesaid and for the purpose of all the foregoing provisions of
this clause the carrier is
or
shall be deemed to be acting as agent
or
trustee on behalf of and for the benefit of all persons who are
or
might be his servants
or
agents from time to time (including
independent contractors as aforesaid) and all such persons shall
to this extent be
or
be deemed to be parties to the contract in
or
evidenced by this bill of lading.
. . .”
Clause
11
of the bill of lading limited the carrier’s liability to
flOO
per package
or
unit, in the absence of a declaration of value
and the payment of an alternative rate.
The action before Beattie
J.
was complicated to a certain extent
by the fact that the claim had been brought more than a year after
delivery of the goods. Nevertheless, the court treated the real issue
as
being whether the defendant stevedores were entitled to the
immunities conferred by clause
11.
The stevedoring company was
a
subsidiary of the carrier and so was well aware that the carrier’s
bills
of lading contained clause
1.
As
to the position of the plaintiff consignee, by virtue of section
13
of
the Mercantile Law Act
1908
(N.Z.), which corresponds to
section
1
of the Bills of Lading Act
1855
(U.K.),
it
had succeeded
to the rights and liabilities of the consignor.
For
its part, the
defendant relied on Lord Reid’s four points. As to the first and
second of these, it was clear that the stevedores were intended to be
protected and that the carrier had purported to act as their agent.
The third point required that the carrier should have the stevedores’
authority
to
contract as their agent
or,
in the alternative, that
ratification should have occurred. The stevedores had seen the bill
of
lading before they unloaded the cargo and, on this basis, Beattie
.J.
held that, since they had performed in the knowledge that clauses
1
and
11
existed, there had been an implied ratification, But he
went on to say that, in any event, the mere fact that the stevedores
were in the present action relying on the two clauses could
per
se
be
regarded as an act
of
ratification.
This left the fourth and most difficult
of
Lord Reid’s require-
ments, namely, the need for the stevedores to show consideration.
The initial problem was that Lord Reid appeared to have thought
VOL.
35
7
To continue reading
Request your trial