The "Karnak."
| Jurisdiction | UK Non-devolved |
| Judgment Date | 15 June 1869 |
| Date | 15 June 1869 |
| Court | Privy Council |
English Reports Citation: 16 E.R. 677
ON APPEAL FROM THE HIGH COURT OF ADMIRALTY.
Mews' Dig. tit. Shipping; A. X. Bottomry; 2. b. Authority of Master-Law of the Flag-Master's Personal Credit-Cargo-Power to Hypothecate; 3. Allowable Items. S.C. L.R. 2 P.C. 505; 38 L.J. Adm. 57; 21 L.T. 159; 17 W.R. 1028; and below, L.R. 2 Ad. and E. 289. See The Empire of Peace, 1869, 39 L.J. Adm. 15; Currie v. Bombay Native Insurance Co., 1869, 6 Moo. P.C. (N.S.) 317, L.R. 3 P.C. 83; The Ida, 1872, L.R. 3 A. and E. 550; The Limerick, 1876, 1 P.D. 299. By s. 18 of the Judicature Act, 1873 (36 and 37 Vict. c. 66), and s. 4 (3) of the Judicature Act, 1891 (54 and 55 Vict. c. 53), the jurisdiction of the Judicial Committee upon any judgment or order of the High Court of Admiralty, was, except as to Prize, transferred to the Court of Appeal.
[136] ON APPEAL FROM THE HIGH COURT OF ADMIRALTY. MESSRS. DROEGE AND COMPANY,-Appellants; MESSRS. SUART AND SIMPSON,-Respondents * [June 14, 15, 1869]. the "karnak." The extent of the authority conferred on the Master of a Vessel to bind the Owners either of the Ship or cargo, is derived from, and governed by, the law of the Flag [6 Moo. P.C. (N.S.) 145,146]; and the existence of the necessity which the Maritime Law requires to validate the hypothecation of the Ship and cargo by bottomry, is to be ascertained by evidence in the usual manner. The meaning of the term " necessity," in respect of hypothecation by the Master, being analogous to its meaning in other parts of the law [6 Moo. P.C. (N.S.) 145, 146]. The Master of a Vessel, chartered from Galveston, U.S., to Liverpool, received before sailing from the Charterer various sums in part payment of the freight, and after taking on board a cargo, sailed for the port of destination. The Vessel, having in the prosecution of her voyage met with bad weather, and suffered damage, put into Bermuda, where the Master incurred heavy * Present:-Lord Romilly (Master of the Rolls), Sir William Erie, Sir James William Colvile, and Sir Joseph Napier, Bart. 677 VI MOORE N.S., 137 DROEGE V. SUART-KARKAK. (THE) [1869] expenses for repairs and supplies. The repairs were executed, and the supplies furnished, without any promise of a Bottomry Bond; but the law of Bermuda giving a right of arrest of the Ship to the Creditors for the repairs and supplies, the Master to complete the voyage, having written to the Agent of the Owners, of the Ship, and of the cargo, and not receiving any answer within the time an answer might have been returned, raised the funds necessary for the payment of such supplies on bottomry of the Ship, cargo, and freight. On a suit brought by the Assignees of the Bond, the owners of the Ship not opposing, the Court below pronounced for the validity of the Bond, so far as it regarded the Ship, cargo, and freight, and the Ship was thereupon sold, but produced a sum far less than sufficient to cover the sum due on the Bond. The Consignees of the cargo, who were also entitled to the freight, claimed to retain in their hands the amount of freight, with interest and insurance, advanced by them in part payment before the commencement of the voyage, and paid the freight, short of that amount, into Court. The Court below disallowed this abatement, and ordered the whole freight to be paid into Court. On appeal:-- Held, by the Judicial Committee, (1) that, in the circumstances, the Master was warranted in resorting to a Bottomry Bond, and that the necessity of the case warranted the hypothecation of the cargo as well as the Ship and freight [6 Moo. P.C. (N.S.) 147], but, (2) as the latter was, by the agreement between the Charterer and the Master, in part paid in advance, the retention of the amount of such prepayment by the Consignees of the cargo, upheld, as the Master by hypothecating the chartered freight could give no right to more freight than the Owner had a right to demand from the Charterer [6 Moo. P.C. (N.S.) 148]. This was an appeal from a judgment of the High Court of Admiralty, pronounced in a case of bottomry instituted by the Respondents, the holders of a Bottomry Bond against the Karnak, her freight and cargo. The Appellants were the Owners of the cargo. The Karnak, a Vessel of 267 tons register, George S. Locke, Master, was in the year 1866, at [137] Galveston, in the United States of America, where, on the 21st of November, 1866, she was chartered to Messrs. Droege and Co., of Galveston, there to load a complete under-deck cargo of compressed cotton, and carry the same to Liverpool for freight, according to the original terms of the charterparty; the freight was payable after unloading and right delivery of cargo at Liverpool, with a commission of 5 per cent, on the freight, the Vessel being consigned to the order of the Appellants, Messrs. Droege and Co., of Manchester. After the making of the charterparty, and whilst the Vessel was lying at Galveston, and before she departed on her voyage, the Appellants, from time to time, advanced to the Master, on account of the necessary disbursements, certain moneys, amounting in the whole to £632 14s. 2d.; and it was agreed between the Charterer and the Master that such advances should be made and taken, pro tanto, in part payment of freight, and a receipt to that effect [138] for £596 12s. 6d., part of such advances, was indorsed by the Master on the charterparty as a payment out of the proceeds of the freight, with 10 per cent., and charges for insurance of the above sum. In pursuance of the charterparty, the Karnak took on board 720 bales of cotton (the cargo proceeded against), for which the Master signed Bills of lading; and on the 24th of December, 1866, the Vessel sailed for Liverpool. On the 17th of January, 1867, the Karnak, having in the prosecution of...
To continue reading
Request your trial