Penney v Clyde Shipbuilding and Engineering Company
| Jurisdiction | England & Wales |
| Judgment Date | 15 March 1920 |
| Date | 15 March 1920 |
| Docket Number | No. 3. |
| Court | House of Lords |
Ld. Chancellor (Birkenhead), Viscount Haldane, Viscount Finlay, Viscount Cave, Ld. Dunedin.
Contract—Sale—Ship—Shipbuilding contract—Passing of property.
War—Trading with the enemy—Enemy property—Vesting of property in Custodian—Executory contract terminated by war—Unfinished ship—Property passed to, and instalments paid by, enemy purchasers—Ship requisitioned and purchased by Admiralty—Right of Custodian to equivalent of instalments paid—Interest—Counter claims—Trading with the Enemy Acts, 1914 (5 and 6 Geo. V. cap. 12), 1915 (5 and 6 Geo. V. cap. 79), and 1916 (5 and 6 Geo. V. cap. 105).
Scottish shipbuilders contracted to build a ship for Austrian shipowners, payment to be made by instalments at fixed stages of the construction, the property to pass to the purchasers as the work proceeded, and the ship to be ready for delivery (subject to certain rights of rejection by the purchasers) on 30th September 1914. On the declaration of war between Great Britain and Austria on 12th August 1914 the vessel was nearing completion, and the purchasers had paid instalments of the price amounting to £79,732. On 17th February 1915 the Admiralty requisitioned the ship as she then stood at the price of £86,000, but it was not until 30th July 1917 that the Admiralty paid the builders that sum, and they refused to pay any interest from the date of requisition. On 1st December 1917 the Board of Trade pronounced an order vesting the sum of £79,732, with interest from the date of receipt of the instalments, in the Custodian for Scotland under the Trading with the Enemy Amendment Act, 1914, as ‘monies owing to or held for or on behalf of or on account of’ the enemy purchasers, and the Custodian brought an action against the builders for payment of this sum and interest. The builders resisted payment; and also stated two counter claims against the fund, (1) for loss caused by the ship occupying a berth in their yard after the stipulated date of delivery, and (2) for the interest which the Admiralty had refused to pay.
The House of Lords—in terms of an agreement entered into, at the suggestion of the House, by the parties during the hearing—found (aff. judgment of the First Division) that the pursuer was entitled to decree for £79,732 with interest from the date of the interlocutor of the First Division, but (rev. judgment of the First Division) under deduction from the sum of £79,732 of such sum, if...
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Cantiere San Rocco v Clyde Shipbuilding and Engineering Company
...interlocutor does not appear to have been reclaimed against. In Penney v. The Clyde Shipbuilding and Engineering Co., 1919 S. C. 363, 1920 S. C. (H. L.) 68, the Clyde Shipbuilding and Engineering Co. (who are also defenders in the present action) had contracted to build a ship for Austrian ......