Tojo Maru (Owners) v N.v Bureau Wijsmuller; The Tojo Maru
| Jurisdiction | UK Non-devolved |
| Judge | Lord Reid,Lord Morris of Borth-y-Gest,Viscount Dilhorne,Lord Pearson,Lord Diplock |
| Judgment Date | 16 March 1971 |
| Judgment citation (vLex) | [1971] UKHL J0316-1 |
| Date | 16 March 1971 |
| Court | House of Lords |
[1971] UKHL J0316-1
Lord Reid
Lord Morris of Borth-y-Gest
Viscount Dilhorne
Lord Pearson
Lord Diplock
House of Lords
Upon Report from the Appellate Committee, to whom was referred the Cause Owners of Motor Tanker "Tojo Maru" against N.V. Bureau Wijsmuller, et è contra, that the Committee had heard Counsel, as well on Tuesday the 12th as on Wednesday the 13th, Thursday the 14th, Monday the 18th, Tuesday the 19th, Wednesday the 20th, Thursday the 21st, Monday the 25th, Tuesday the 26th and Wednesday the 27th, days of January last, upon the Petition and Appeal of the Owners of Motor Tanker "Tojo Maru", 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 30th of July 1969, 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 Cross Appeal of N. V. Bureau Wijsmuller of Sluisplein 34, Ijmuiden, Holland, praying, That the matter of the Order set forth in the Schedule thereto, namely the said Order of Her Majesty's Court of Appeal of the 30th of July 1969, so far as regards the words: " Allowed the said appeal and remitted the case to the Arbitrator to ascertain the proper salvage reward taking into account the damage done by the negligence of Diver Vis, but not to award any damages on the Respondent's counterclaim." might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Order, so far as aforesaid, 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 Case of N. V. Bureau Wijsmuller; and also upon the Case of the Owners of Motor Tanker "Tojo Maru", lodged in the said Original and Cross Appeals; and due consideration had this day of what was offered on either side in these Appeals:
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 Order of Her Majesty's Court of Appeal, of the 30th day of July 1969, complained of in the said Original and Cross Appeals, be, and the same is hereby, Discharged: And it is further Ordered, That the Cause be, and the same is hereby, remitted back to the Arbitrator with a Direction to revise his Award on the basis that (First) There should be no award of salvage remuneration, but (Second) In assessing the Shipowners' damages there must be a deduction of the hypothetical salvage remuneration which would have been awarded if the contractors had duly performed their contract: And it is further Ordered, That the Respondents in the Original Appeal do pay, or cause to be paid, to the said Appellants in the Original Appeal the Costs incurred by them in the Court of Appeal, and also the Costs incurred by them in respect of the said Original Appeal to this House, the amount of such last-mentioned Costs to be certified by the Clerk of the Parliaments: And it is further Ordered, That the Order of the Right Honourable Lord Justice Willmer, of the 13th day of January 1969, thereby Set Aside, be, and the same is hereby, Restored as to Costs: And it is further Ordered, That the said Petition and Cross Appeal be, and the same is hereby, Dismissed this House: And it is also further Ordered, That the Appellants in the Cross Appeal do pay, or cause to be paid, to the said Respondents in the Cross Appeal the Costs incurred by them in respect of the said Cross Appeal, the amount thereof to be certified by the Clerk of the Parliaments.
My Lords,
On 25th February, 1965, the "Tojo Maru", a tanker of 25,000 tons, was in collision with an Italian ship near Mene al Ahmadi in the Persian Gulf. She sustained extensive damage. A fuel tank and the engine room were flooded. A tug belonging to the Respondents was on salvage station about 180 miles away and the next day she arrived and offered her services for salvage. On 28th February a standard Lloyd's form of "No cure—no pay" salvage agreement was signed. The Respondents sent out a party of eight and a quantity of gear from Holland. They arrived on 2nd March and salvage work then commenced.
The engines of the "Tojo Maru" were liable to deteriorate rapidly so the leak into the engine room was stopped. The water was pumped from the engine room and preservative measures were taken. Then the cargo of crude oil was discharged and a large plate some 30 feet wide was made to cover the aperture left by the collision. The plate had to be bolted to the hull. This was to be done by firing bolts from a Cox bolt gun. This could not be done safely until the adjoining tank had been made gas free. But on 11th April the Respondents' chief diver, contrary to the orders which he had received, proceeded to attempt to bolt the plate into place by firing the bolt gun. The result was an explosion which caused extensive damage and began a fire in the "Tojo Maru". Additional help was obtained to put out the fire and delay was caused in making the vessel sufficiently seaworthy to be towed away. On 24th April the vessel was ready for towage first to Singapore and then to Kobe where the vessel was repaired.
The salvage agreement provided for arbitration in London. There claims were made by the Respondents for salvage and by the Appellants, the owners of the "Tojo Maru", for damages caused by the negligence of the Respondents' diver in causing the explosion. The Respondents farther submitted that any such damages must be limited in terms of section 503 of the Merchant Shipping Act 1894 as amended.
With regard to the claim for damages the Arbitrator held that the action of the diver was a breech of the duty owed by the Respondents to the Appellants and was negligent and was the sole cause of the explosion, and farther that the ensuing damage was foreseeable. He found that the whole damage suffered by the Appellants amounted to £331,767 and that of this sum £202,514 was in respect of the repairs to the vessel rendered necessary by the explosion. He did not have to deal with the cargo. He held that the proper salvage award for the ship and freight would be £125,000. He held that there was no fault or privity on the part of the Respondents and that they were entitled to limit their liability to £10,725. So he awarded £10,725 to the Appellants. He gave no reason but he must have held that the provision in section 503 of the Act of 1894 that the owners of a ship "shall not be liable in damages beyond" certain amounts, did not preclude him from setting off the whole of the damages against the sum due for salvage and thereafter applying the limitation provisions.
A Special Case stated by the Arbitrator then came before Willmer, L.J. He conveniently defined the issues argued before him as follows:
"It seems to me that the points which arise for decision can be restated in the following way, putting them in their logical sequence: (1) What is the proper way to deal with the owners' complaint as to the damage resulting from the negligent act of Vis? In particular, in the circumstances of this case is it permissible to entertain the owners' counterclaim for damages, or should the negligence of Vis be allowed for by merely reducing the contractors' award of salvage? (2) Assuming that it is open to the owners to counterclaim for the actual loss sustained by them, can the contractors limit their liability? (3) Assuming that the contractors are entitled to limit their liability, is there a right of set-off as between the contractors' claim for salvage and the owners' counterclaim for damages? If so, is it right first to set off so much of the owners' counterclaim as will extinguish the contractors' claim, so as to apply the right to limitation of liability only to the balance of the counterclaim? Or is the sum to be set off only the limited amount of the contractors' liability, so as to leave them with all but £10,725 of the 'proper remuneration' of £125,000?"
On the first of these issues he found that the owners, the present Appellants, were entitled to counterclaim. On the second he found that the contractors, the Respondents, were not entitled to limit their liability. So he did not have to decide the third issue but he expressed the opinion that the Arbitrator was wrong.
The Court of Appeal reversed the decision of Willmer L.J. and held that the owners were not entitled to counterclaim for damages caused by the salvors' negligence. Different views were expressed about the question whether the limitation provisions applied. In this appeal the owners seek to have the order of Willmer L.J. restored subject to a minor variation.
On the first question the argument for the owners, stated very briefly, is that the salvors by their contract undertook to "use their best endeavours" to salve the vessel, that in breach of that contract they negligently caused damage to the vessel, and that therefore they are liable in damages for the loss caused to the owners by their negligence. The argument for the salvors is that there is a rule of maritime law that a successful salvor cannot be liable in damages to the owner for the result of any negligence on his part; such negligence entitles the Court, or the Arbitrator, to reduce or forfeit the salvage award but it cannot give rise to any claim for damages.
The maritime law of England has a long history. It differed in many respects from the Common Law; statutory amendment of the common law has removed some of these differences but by no means all. So if examination of the authorities led me to the conclusion...
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