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current rate of freight when the ship should be loading. It was also agreed, that the master of the vessel and the agents at Bombay should be at liberty to make such alterations in the charterparty as they might mutually think proper, without prejudice to the agreement. Shortly after the arrival of the vessel at Bombay, G. & Co. agreed by a memorandum indorsed on the charter-party, that before loading her homeward cargo, the vessel might proceed to Aden with Government coals and stores and return to Bombay with all possible despatch. The vessel proceeded to Aden in February and returned thence in May, having earned freight, which was paid to the plaintiffs:-Held, that G. & Co. had authority to permit the voyage to Aden, and that the defendant was bound by the alteration in the charter-party; and therefore, that he was bound to pay the charter rate of 37. per ton for half the cargo, although that exceeded the current rate of freight at the time of loading, and although the alteration might be prejudicial to him; and that he was not entitled to bring into the account the freight earned by the owners on the Aden voyage.
One of the most common class of cases, in which Mistake. relief is sought in equity, on account of a mistake of fact, is that of written agreements, either executory or executed. Sometimes by mistake, the written agreement contains less than the
1 Wiggins v. Johnston, 15 L. J. Ex. 202.
parties intended; sometimes it contains more; and sometimes it simply varies from their intent by expressing something different in substance from the truth of that intent. In all such cases, if the mistake is clearly made out by proofs entirely satisfactory, equity will reform the contract, so as to make it conformable to the precise intent of the parties.1
It is upon the same ground that equity interferes in cases of written agreements, where there has been an innocent omission or insertion of a material stipulation, contrary to the intention of both parties, and under a mutual mistake. To allow it to prevail in such a case, would be to work a surprise or fraud upon both parties; and certainly upon the one who is the sufferer."
So where in an action against T. W. and J. C. H. for not loading according to the terms of a charter-party, the defendants pleaded, on equitable grounds, that they entered into the charter-party solely as agents of D. & Co. and that before they signed, it was agreed between the plaintiff and the defendants that the defendants were only to sign as such agents so as to bind D. & Co.; and were not to make themselves liable as principals for the performance of the charter; that they signed the charter in the following manner:-" For D. & Co.; T. W. & J. C. II., Agents," the defendants and the plaintiff bona fide believing at the time that the
Story Eq. Juris, s. 152.
2 Story Eq. Juris. s. 155.
defendants having so signed would not be personally liable as charterers, notwithstanding the charter professed to be made between the plaintiff as owner and the defendants as merchants and freighters; that the defendants had power to bind D. & Co. by signing the charter as their agents; and that D. & Co. were bound by the charter ; and that the plaintiff was inequitably taking advantage of the mistake in drawing the charter so as to make the defendants personally liable, contrary to the intention of the plaintiff and defendants:-It was held that this was a good equitable plea.'
And in the case of Smidt v. Tiden2 it was held that no freight was payable under a charter-party to the plaintiff, where, owing to a mutual mistake, no contract could be implied to do so, the parties never being ad idem.
Where a mistake or error arises in communicating the principal's instructions to the agent, and the latter innocently acts on such mistaken instructions, he will not be liable in an action founded on such mistake. Thus, where a firm of ship brokers signed a charter-party in the form "by telegraphic authority" of the charterer "as agent;" owing to a mistake made by the officials in its transmission, the rate of freight offered by the charterer had been misrepresented in the telegram which the shipbrokers had received from him. In an action
1 Wake v. Harrop, 31 L. J. Ex. 451.
243 L. J. Q. B. 199.
Effect of written words
brought by the owners of the ship against the shipbroker for breach of warranty of authority, it was held he was not liable, as he only had such authority to act as might be conferred on him by an erroneous telegram.1
And in Breslauer v. Barwick where a charterparty was drawn up on one of the printed forms of a company, whose name was by mutual mistake and oversight of both the owner and the charterer allowed to remain, but with whom they had no connection or transaction whatever, the charterparty was signed by the parties in their own name. In an action by the charterer it was pleaded that the charter-party was made between the owner and the Company whose name appeared in the body of the charter-party and had not been struck out. This plea, however, was held to be bad, and that the charter-party did not require to be rectified as both the charterer and shipowner had signed it.
Charter-parties are ordinarily made out on printed in the printed forms applicable to contracts of their respective classes generally, the parties filling up in writing the particulars of the contract into which they are entering. It not unfrequently happens that different parts of the same contract are not easy to reconcile with each other, and the question then arises which part is to give way.
"It is a well-known and recognised mercantile practice to insert in writing on a printed form the
Lilly, Wilson & Co. v. Smales, Ecles & Co., L. R. (1892) 1 Q. B. 456. 23 Asp. M. L. C. N. S. 355,
terms of the contract intended to be entered into, without striking out the printed words which are not adopted.'
In the interpretation of the charter-party a meaning must, if possible, be given to every part of it," unless one part is inconsistent with another part, or unless the instrument is a general form, some of the provisions of which are inapplicable to the agreement to be interpreted.3
When one part of a written agreement is inconsistent with another part, that part which is inconsistent with the general intention of the parties as it appears from the agreement considered as a whole is to be rejected; but if neither part is inconsistent with the general intention of the parties, as it appears from the agreement considered as a whole, and one part is in writing, and the other is printed, the printed part is to be rejected; but if both parts are in writing or both are printed, that part which occurs last is to be rejected."
In Alsager v. The St. Katherine's Dock Co. Pollock, C. B. observed:-"It has been contended.
1 Per Lord Penzance in Dudgeon v. Pembroke, 46 L. J. Q. B. 413.
* Morris v. Levison, L. R. 1 C. P. D. 157, 160.
3 Pearson v. Goschen, 33 L. J. C. P. 265; Gray v. Carr, L. R. 6 Q. B. 536; Dudgeon v. Pembroke, L. R. 2 App. Cas. 293.
* Furnival e. Coombe, 5 M. & G. 736; Kelner v. Baxter, L. R. 2 C. P. 174; 36 L. J. C. P. 94; McCollin v. Gilpin, L. R. 6 Q. B. D. 516.
Alsager v. St. Katherine's Docks Co., 14 M. & W. 791.
Doe r. Biggs, 2 Taunt, 108.
14 M. & W. 798. See also Robertson v. French, 4 East, 136; Hinton v. Sparkes, L. R. 3 C. P. 161 ; Joyce v. Realm Ins. Co., L. R. 7 Q. B. 583; Moore r. Harris, L. R. 1 App. Cas. 327; Dudgeon v. Pembroke, L. R. 2 App. Cus. 293; Gray v. Carr, L. R. 6 Q. B. 529; Cross v. Pagliano, L. R. 6 Ex. 13; Jessel v. Bath, L. R. 2 Ex. 207.