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Upon this charter-party a question arose as to the liability of the shipowner to merchants who had shipped goods from Calcutta to London under a bill of lading given by Betham: the shippers having had notice of the charter-party, and received a copy of it, from the owner's agent on board the ship.
It was held in the House of Lords affirming the Exchequer Chamber, which had reversed the decision of the King's Bench, that the owners were not responsible. Betham was considered to be, under the charter-party, the temporary owner of the ship, and that the contract was made by and with him, not as agent for the owners but on his own behalf.
Tindal, C. J. said:" Under these circumstances, we think the captain, in putting up the ship as a general ship and signing bills of lading, cannot be considered as acting as the servant or agent of the shipowners, or in any other manner than as the temporary owner of the ship." 1
Lord Tenterden in the House of Lords thus stated the law on this subject:-"Two propositions of law are clear as applicable to a case like this, the first is, that in the common case of goods shipped on board a vessel belonging to a person, of which shipment is acknowledged by a bill of lading signed by the master, if the goods are not delivered, the shipper has the right to maintain an action 17 Bing, 208.
21 C. & F. 283.
Third Class of Contracts.
against the owner of the ship: the other which is equally clear, is this, that if the person in whom the absolute property of the ship is vested, charters that ship to another for a particular voyage, although the absolute owner provides the master, crew, provisions and everything else, and is to receive from the charterer of the ship a certain sum of money for the use and hire of the ship, an action can be brought only against the person to whom the absolute owner has chartered the ship, and who is considered the owner pro tempore, during the voyage for which the ship is chartered.
The third class is the ordinary contract for the carriage of the merchant's goods in the owner's ship, and by his servants, but as the stipulations and terms are constantly varied, these so far as they have come before the Courts will be considered later on under their several headings.
In the case of Sandeman v. Scurr, Lord Chief Justice Cockburn stated the effect of a charter-party on the relative positions of a shipowner and sub-freighter as follows:-"The result of the authorities from Parish v. Crawford 2 downwards. and more especially the case of Newberry v. Colvin3 is to establish the position, that in construing a charter-party in reference to the liability of the owners of the chartered ship, it is necessary to look to the charter-party, to see whether it operates as a demise of the ship itself, to which the services of
L. R. 2 Q. B. 86, 96.
22 Str. 1251.
3 7 Bing. 190.
the master and crew may or may not be superadded, or whether all that the charterer acquires by the terms of the instrument is the right to have his goods conveyed by the particular vessel, and as subsidiary thereto, to have the use of the vessel and the services of the master and crew.
"In the first case, the charterer becomes for the time the owner of the vessel, the master and crew become to all intents and purposes his servants, and through them the possession of the ship is in him. In the second, notwithstanding the temporary right of the charterer to have his goods loaded and conveyed in the vessel, the ownership remains in the original owners, and through the master and crew who continue to be their servants, the possession of the ship also. If the master, by the agreement of his owners and the charterer, acquires authority to sign bills of lading on behalf of the latter, he nevertheless remains in all other respects the servant of the owners.
There is here no demise of the ship itself either expressed or implied. It amounts to no more than a grant to the charterer of the right to have his cargo brought home in the ship, while the ship itself continues, through the master and crew, in the possession of the owners, the master and crew remaining their servants."
In the Omoa and Cleland Coal and Iron Co. r. Huntley,' a steamer was "let for the sole use
of the charterers, and for their benefit, for the space of 6 months," with option to take her longer; and the services to be rendered were thus described:-"The said vessel or steamer being tight, staunch and strong, and in every way fitted for the voyage or service, and so maintained by owners, with a full complement of officers, seamen, engineers, and firemen, adapted to a steamer of her class, shall be placed under the direction of the charterer, merchant, or his assigns, to be by him or them employed for the conveyance of lawful merchandise and passengers as follows:-between ports in the United Kingdom and the Continent, Baltic and Black Sea being excluded between 1st September and 1st March, as may be ordered by the charterers, the cargoes to be laden or discharged in any dock or other safe place the charterers may order."
The charterers were to have the whole reach of the vessel, reserving space to the owner for the crew, &c. The captain was to use all dispatch in prosecuting the voyages, and the crew were to "render all customary assistance in loading and discharging." Also the captain was to sign bills of lading as presented, without prejudice to the charter-party, and to follow the charterer's instructions "as regards loading, discharging and departure."
Coals, port charges, pilotage and extra labourage, were to be paid for by the charterers; but the
owner was to pay the crew and find all ship's stores and other necessaries. The freight for the hire of steamer was to be "4107. per month, payable in advance monthly, until the vessel is again returned by the charterers," after notice. "The vessel to be delivered up on the termination of this charterparty on Clyde or Forth. All derelicts and salvages for owner's and charterers' equal benefit." The captain was also to furnish the charterers with a daily copy of the log, if required.
In the course of a voyage under this contract the vessel was wrecked, owing to negligence of the master and crew; and the question arose, whether the owner was liable to the charterers for that negligence. It was held that he was; for by the charter-party it was intended that, so far as concerned the navigation of the vessel, he was to retain her under his control for the purpose of carrying out his contract. The charterers might direct where the vessel was to go, and with what she was to be laden, but the owner remained in all respects accountable for the manner in which she might be navigated. 1
The term demise is now generally used in the sense in which Lord Chief Justice Cockburn Ship is an employed it, but it is an ambiguous word, and as a general rule, unless it be qualified, by stating the sense in which it is used, it is open to misconstruc
1 Wagstaff v. Anderson, L. R. 5 C. P. D. 171.
2 The Patria, L. R. 3 A. & E. 436; The Beeswing, 5 Asp. M. L. C. 484; The St. Cloud, 1 Asp. M. L. C. N. S. 309.