K.B. Div.]

The suppliants now claimed compensation.
In their Petition of Right they alleged :

1. Your suppliants are a steamship company carrying on business at Helsingborg in the Kingdom of Sweden, and were the owners of the Swedish steamship Amphitrite at all material times.

2. By a contract contained in letters from your suppliants to the British Legation at Stockholm, dated the 8th March 1918, the 19th March 1918, and the 1st May 1918, and from the British Legation, Stockholm, acting on behalf of your Majesty's Government to your suppliants, dated the 18th March 1918, the 20th March 1918, and the 9th May 1918, your Majesty's Government contracted with your suppliants that in consideration of the Amphitrite proceeding to the United Kingdom upon two voyages with full cargoes consisting of at least 60 per cent. of approved goods, your Majesty's Government would not detain the vessel and would provide her with facilities to obtain coal cargoes and bunker coal.

3. In pursuance of the said contract, the Amphitrite was duly sent to the United Kingdom with full cargoes consisting of at least 60 per cent. of approved goods and on the first voyage was not detained and was granted the facilities, but after duly sailing to the United Kingdom on the second voyage and landing a second full cargo, consisting of at least 60 per cent. of approved goods, your Majesty's Government, in breach of its contract, and after granting the necessary loading facilities suddenly withdrew them, and refused to grant a clearance whereby the vessel was detained from the 5th July 1918 to the 18th Sept. 1918, on which date your suppliants sold her.

4. By reason of the aforesaid breach of contract your suppliants lost the use of their vessel for seventy-five days and sustained damages at the rate of 2304 kroner per day, amounting to 172,800 kroner with

interest.

In his answer and plea on behalf of the Crown the Attorney-General admitted the letters specified in the petition and said he would refer to them at the trial for their terms. He submitted that the letters constituted no contract between His Majesty and the suppliants. The letters from the British Legation at Stockholm, he said, were expressions of the then present intention of His Majesty's Government and no more. He denied that the voyages of the Amphitrite to the United Kingdom or either of them were or was made in pursuance of any contract with His Majesty.

Par. 5 was as follows:

The Attorney-General admits that on or about the 18th July 1918 the vessel then being at Methil, His Majesty's Government ordered that no loading facilities should be granted to her unless the same were applied for through the Swedish Shipowners' Committee. No such application was made, and loading facilities were not granted until after the 18th Sept. 1918, when the ship was sold by the suppliants.

By par. 6 the Attorney-General submitted that all acts done by His Majesty's Government in relation to the suppliants and the ship in question were done in time of war as acts of State towards the suppliants, who were not subjects of His Majesty nor resident within His Majesty's dominions and that no complaint in respect of any such acts was cognisable in that court.

R. A. Wright, K.C., and R. H. Balloch for the suppliants.

Sir Gordon Hewart (A.-G.) and H. M. Giveen for the Crown.

[K.B. Div.

ROWLATT, J.-In this case the suppliants are a Swedish company of shipowners. They sue the Crown by petition of right to recover damages for breach of contract, the alleged breach of contract, refused being that the ship Amphitrite was clearance to enable her to leave this country, when she had entered a British port under an arrangement whereby she was promised that that clearance would be given to her.

66

a

Undoubtedly, the suppliants desired to get the clearest and most binding assurance that was possible. Their vessel was free. They might have employed her elsewhere, and they had had experience of the difficulties encountered by foreign ships in getting away from this country when once they had come here. Accordingly, on the 8th March 1918, they wrote to the British Legation at Stockholm and asked whether, in the event of the vessel being put in trade between Sweden and England, the Legation could give them a guarantee that she would be allowed free passage without being detained in Great Britain. The answer to this by the proper authority was that in the event of the vessel's being sent to the United Kingdom with a full cargo of approved goods she would earn her own release and would be given a coal cargo. This letter was followed by another on the 18th March, from the British Legation which stated: 'That the steamship Amphitrite will earn her own release and be given a coal cargo if she proceed to the United Kingdom with a full cargo consisting of at least 60 per cent. approved goods." That reply was given by the British Legation after consulting the proper authorities in Great Britain, and I must take it that it was given with the highest authority with which it could be given on behalf of His Majesty's Government. But the vessel was not chartered by the British Government so as to make that a term of the charter-party. By those letters the British Government merely undertook that if the ship traded to this country she should not be subjected to the delays which were sometimes imposed. The letters in which that undertaking was contained were written with reference to an earlier voyage which was allowed to go through, the undertaking being on that occasion observed. But the undertaking was renewed with respect to the voyage in connection with which the present complaint arises, by a letter from the British Legation, in which it is stated, that "the steamship Amphitrite will be allowed to release herself in her next voyage to the United Kingdom "-that is to say, upon the same terms as previously.

Now in those circumstances, I have to consider whether there was a contract at all. I have to consider whether the letter which I have just read was a contract at all. I have not to consider whether there was anything of which complaint might be made outside a court, that is to say, whether what the Government did, was morally wrong or arbitrary. That would be altogether outside my province. All that I have to decide

is whether there was an enforceable contract. am of opinion that there was not.

I

No doubt the Government can bind itself, through its officers, by a commercial contract, and if it does so, it must perform it like anybody else or pay damages for the breach. But there was no commercial contract in this case. It was an arrangement whereby the Government purported to give an assurance with regard to what its executive action would be in the future in relation to a

H. OF L.]

The following cases were referred to :

Re Knight and Tabernacle Building Society, 67
L.T. Rep. 403; (1892) 2 Q. B. 613;
Re Kirkleatham Local Board and Stockton
Water Board, 67 L. T. Rep. 811; (1893)
1 Q. B. 375;

Re Holland Steamship Company and Bristol
Steam Navigation Company, 93 L. T. Rep.
769;

Shubrook v. Tufull, 46 L. T. Rep. 749; 9 Q. B.
Div. 621;

Bozson v. Altrincham Urban District Council
(1993) 1 K. B. 547; 1 L. T. Rep. 639;
Salaman v. Warner, (1891) 1 Q. B. 734;
Re Herbert Reeves and Co., 85 L. T. Rep. 495;
(1902) 1 Ch. 29.

Lord BUCKMASTER.-By charter-party dated the 8th April 1916, and made between the appellants, as the owners of the steamship Lord on the one part, and the respondents as charterers of the vessel on the other, the said steamship was chartered for a term of six months from the date of delivery. The charter-party contained provisions that the captain should prosecute his voyage with due dispatch and exempted the owner from liability for damage from various causes therein specified, including negligence default or error of judgment of the masters. There was also the usual provision that, in case of dispute, the matter should be referred to the arbitration in London of two arbitrators and their umpires.

On the 26th Sept. 1916, the vessel, after loading, left Liverpool on a voyage to Archangel in accordance with the instructions given by the respondents. The voyage was never completed owing to the fact that the master, in anticipation of danger due to German submarines, delayed the ship, and, on the 2nd Nov. the monthly freight due on the 19th Oct. being unpaid, the appellants withdrew the vessel from the service of the respondents.

Disputes consequently arose between the parties, the appellants claiming for hire, war insurance and other expenses, and the respondents for loss incurred by withdrawal and delay. These disputes were referred to arbitration in accordance with the provisions of the charter-party. The arbitration was duly held, and, on the 21st Nov. 1919, an award was issued in the form of a special case. The whole question on this appeal is whether this award was a complete and final exercise of the power of the arbitrator, or whether it was partial and interlocutory, reserving powers which had not been exercised and which, in certain events, the arbitrator would be compelled to exercise in order to put a final conclusion to the dispute. The important difference of these two views is due to the provisions of the Arbitration Act. This provides, by sect. 7, that the arbitrator should have the power to state a final award in the form of a special case; but, by sect. 19, power is also given to state a special case on any question at law at any stage of the proceedings. If the special case be stated under sect. 7 it can be appealed from the judge who determines it to the Court of Appeal; but, in the latter case, the decision of the judge before whom the matter is first heard cannot be challenged. It is under this latter head that the respondents say that the present case falls. Consequently they contend the decision of Bailhache, J., before whom the matter was first heard, is complete, and the Court of Appeal had no jurisdiction to entertain this matter.

The Court of Appeal has taken this view, Scrutton, L.J. dissenting, and it is from this decision that this appeal has been brought.

The whole difficulty is due to the ambiguous form of the award issued. It is stated upon its face to be

an award and, after a general recital, contains the statement that the arbitrator had been requested to make an award in the form of a special case, and it concludes with a final assessment of costs. All this is properly referable to the idea that the award is a final statement under sect. 7; but clause 21 modifies the effect of this language and gives rise to the difficulty. That clause finds its place in the award after the full examination of the facts.

He states that the voyage was abandoned on the 31st Oct. and that the owners were justified in withdrawing the steamer for non-payment of the hire, but that they committed a breach of clause 9, which provides that the captain should prosecute his voyage with the utmost dispatch. On these views he assessed the damage due to the owners and to the charterers respectively, leaving a balance in favour of the owners of a sum of 18491. 08. 9d. He then concludes in these words: (21) The question for the opinion of the court is whether upon the true construction of the charter-party and the facts as stated by me the decisions at which I have arrived are correct in point of law. If they be correct, my award is to stand, but if incorrect in any particulars, I desire that the award may be referred back to me for re-assessment of the damages due in accordance with the decision of the court.'

The appellants contend that the qualified form of this clause is merely nothing but an expression of the arbitrator's wish that, if the court thinks he has been wrong in a point of law, it should exercise the power under sect. 10 to remit the award for the purpose of re-determining the amount of damage; they suggest that, in fact, this would only require a small and simple sum in arithmetic; and they finally point out that the final clause which awards the cost of arbitration shows that the matter was complete.

I find myself unable to accept this view. The only way in which it is possible to ascertain what was the real effect of this award is to construe its language. Unless it can be found that, according to its terms, the powers of the arbitrator were so exercised that, in any event, his duties under the arbitration were ended, and that he reserved to himself no further power in any event, then the award cannot be regarded as final.

The prefatory language of question 21 is strongly relied upon by the appellants; but there was no need for any such statement at all if the award was intended to be complete. If the matter reserved was nothing but a mere calculation of figures already ascertained and which could not upon any interpretation of the law be altered, it would then have been a simple matter for the arbitrator to have stated that in the event of his conclusion as to the construction of the charterparty being held to be erroneous, he had assessed the final figures in the manner suggested, or he might have left the matter entirely alone, leaving the court, if it were necessary, to send it back for re-adjudication; or the parties themselves could, on that hypothesis, have settled the figures without further reference.

The fact that he had expressly desired that the matter should be referred back to him for reassessment of the damages is to my mind inconsistent

with the view that his power to decide the amount of the damage, which was not in terms assessed, had been fully and effectually discharged.

In the case of the Holland Steamship Company and others (95 L. T. Rep. 769), the circumstances were the same as in the present, excepting that the award stated that if the opinions given by the arbitrator were wrong, "the matter is to be remitted to give effect to the true construction of the contract. I agree with Bankes, L.J. and Warrington, L.J. in thinking that the difference in language between that award and the present is immaterial, and I agree also with both those learned judges that the principle upon which that case proceeded was correct.

The case of Shubrook v. Tufnell (46 L. T. Rep. 749; 9 Q. B. Div. 621) is a case which arose on a discussion as to whether or not an appeal from a decision upon a special case the matter should take its place on the final or interlocutory list; but the Master of the Rolls, in deciding that it ought to appear in the final list, made a statement, upon which Scrutton, L.J. places considerable reliance in arriving at his conclusion. In that case Sir George Jessel said, referring to the case of Collins v. Paddington Vestry (5 Q. B. Div. 368) that "that case only held that where the decision of the court on the point submitted to it could not in any event necessitate the entering of final judgment for either party, the decision was interlocutory. Here, if we differ from the court below, final judgment has to be entered for the defendant, and there is an end of the action.'

He appears to assume that if an award is made in such a form that in one event a decision will make it final that constitutes a final award.

I am unable to agree with this view. It does not appear to me that an arbitrator has exhausted the duties he has undertaken if he makes an award that is final in one event alone and leaves open and undetermined what may happen in any other event, and desires that on the happening of that event the matter shall be sent back to him for completion. It makes no difference how much or how little of his original power as arbitrator is retained, if in fact from the award itself it can be seen that, in the exercise of the duties originally undertaken by him the arbitrator desires, in certain circumstances, that further opportunity should be afforded for the final exercise of that authority the award cannot be regarded as final.

I think the judgment of the Court of Appeal is correct and that this appeal should be dismissed with costs.

Lord SUMNER.-It is from the award itself and from the language in which the umpire has expressed it, that we have to gather what he meant or more exactly what he did. The question is this: When he executed this award did he end his umpirage by making a final award, imperfect in form it may be but exhaustive of his functions, or did he merely submit to the court a question of law on the footing of such findings as he had already arrived at, the answer to which would decide whether he must continue to exercise his arbitral functions, in accordance with a right to do so which by the award he reserved to himself?

are correct, my award is to stand, but, if incorrect in any particulars, I desire that the award may be referred back to me for re-assessment of the damages due in accordance with the decision of the court." The best way for the appellants of reading these words is that adopted by Scrutton, L.J., namely, that the umpire therein requests the court to exercise its powers of sending the case back to him, if, in its discretion, it thinks fit to do so, but this is open to the comment that, if that was what was meant it should have been more clearly stated, or better still, have been left to the court and not stated at all. I think the natural meaning of the words is this: "On the question whether the shipowners are excused from liability for their captain's default, I hold in law that they are not, and have included in my award certain damages against them accordingly. I may be wrong in so holding, but have not hitherto thought it necessary to make up an alternative computation of the damages. I wish to be told if I am right or wrong. If I am wrong, I wish to have the opportunity of completing my award by finding what in that event I should have to decide, though, if I have been right, it does not arise for decision." This accords with the words "for re-assessment of the damages," for the effect of reversing the umpire's decision upon this question of law would be more than a mere rectification of the arithmetic disclosed on the face of the award. The amounts dealt with by the umpire are not so stated in the award as to dispense with "readjustments" by some one, who knows more of the matter than the award itself tells the court.

This construction seems plain but, if the words were ambiguous, I think that the result would be the same for, it should be presumed that the umpire meant to do, and so worded his award as to do, his duty, which was to decide all questions submitted directly or indirectly for his decision. This he would only do, if he consulted the court on the point of law, reserving the final award on the facts in the alternative till he had received a direction. I think the appeal fails.

Lord PARMOOR.-I agree with the opinion expressed by Scrutton, L.J. in the Court of Appeal, and think that the appeal should be allowed. There is a right of appeal, unless the case stated by the umpire comes under sect. 19 of the Arbitration Act of 1889. The determination of the appeal depends upon the construction of the document of the 21st Nov. 1919, signed by the umpire.

special case for the opinion of the court. This is in accord with the language of the recital. Under sect. 19 there is no award. The umpire may at any stage of the proceedings under a reference state, or be ordered to state, in the form of a special case, for the opinion of the court, any question of law arising in the course of the reference. This distinction is fundamental. The purpose of a case stated under sect. 19 is to enable the umpire to obtain guidance during the pendency of the reference in order to assist him in arriving at his decision. Although a case may be stated under this section at any stage of the proceedings, it cannot be stated after an award has been made. The language used by Bowen, L.J. in Re Knight and the Tabernacle Permanent Building Society (67 L. T. Rep. 403; (1892) 2 Q. B. 613), has been accepted in all subsequent cases: The section contemplates a proceeding by the arbitrator for the purpose of guiding himself as to the course he should pursue in the reference. He does not divest himself of his complete authority over the subject-matter of the arbitration. He still remains the final judge of law and fact." I think that the umpire in the present case did divest himself of his complete authority over the subject-matter of the arbitration and that his intention to do so is clear on the construction of the document.

It is not necessary to go through the document in detail, but, inter alia, the umpire found that the owners of the ship had committed a breach of clause 9 of the charter-party and assessed the damages for the breach at 4586l. 118. 4d. He further found that, subject to the opinion of the court of law, there was nothing due by the owners to the charterers, but that there was due by the charterers to the owners the sum of 18491. Os. 9d. in full settlement of all accounts. In respect of a claim made by the charterers for cash advanced by the captain, he disallowed the amount as the charterers had not produced satisfactory proof of such advance. These are decisions made by the umpire under the terms of the reference, and in respect of them he has discharged his duty as the judge of law and fact. Clause 21 is as follows:

The question for the opinion of the court is whether upon the true construction of the charterparty, and the facts as stated by me, the decisions at which I have arrived are correct in point of law. If they be correct my award is to stand, but if incorrect in any particulars I desire that the award may be referred back to me for re-assessment of the damages due in accordance with the decision of the court." There can be no doubt as to the effect of this clause. In one alternative the award stands as the final judgment of the umpire, in the other alternative a desire is expressed that the award be referred back to the umpire for re-assessment of the damages due in accordance with the decision of the court. It was argued that it was not the intention of an umpire to state a case under sect. 7 because he had not dealt with one or more alternative assessments, which only become material if a decision at which he has arrived is not correct in point of law. I think that this contention cannot be maintained. I do not doubt the importance of the form in which a question or questions are submitted for the opinion of the court, but it is only one of the contentions relevant to the construction of the document as a whole, and is not in itself a conclusive test. The umpire asks whether the decisions at which he has arrived are correct

in point of law. If the court agree in this view the umpire has once and for all divested himself of his authority over the subject-matter of the arbitration. I do not desire to place my decision on any meticulous analysis of the language used, and think the result would be the same, whether the umpire had expressed his desire that the award should be referred to him in a certain contingency, or had used the language which was used in Holland Steamship Company v. Bristol Navigation Company (sup.). If an umpire intending to state a case under sect. 7 states it in such a form as not to enable the court to give a final decision on all the matters in issue, there is ample power under sect. 10 of the Arbitration Act 1889 to remit the matters referred, or any of them, to the reconsideration of the umpire. It would not be necessary to make such a remission if the court agree that the decisions at which the umpire has arrived are correct in point of law. As a matter of convenience and economy, it may often happen that a long inquiry into alternatives will be avoided, if, on one point, the decision of an umpire is upheld. I can see no reason why this form of procedure should not be adopted. One of the difficulties in arbitration practice, before the Act of 1889 consisted in the want of an alternative procedure to the revocation of a submission. This alternative is supplied by sect. 10.

The last paragraph in the document is an award of the costs of the arbitration. This, again, is an important matter on which the arbitrator has divested himself of his authority. To award the costs of the arbitration is a necessary factor for finality, in an award stated as a special case under sect. 7 of the Arbitration Act 1889, but is not consistent with the statement of a special case under sect. 19, which is only a step in procedure during the pendency of the reference. In such a case the costs are in the discretion of the arbitrator or umpire and would naturally not be dealt with by him until he made his award. Subject, therefore to the authorities, to which I propose to call attention, the document of the 21st Nov., signed by the umpire, denotes, in my opinion, the intention of the umpire to state his award in the form of a special case, and negatives the suggestion that the umpire intended merely to ask the opinion of the court in a case stated under sect. 19.

The case of Shubrook v. Tufnell (46 L. T. Rep. 749 ; 9 Q. B. Div. 621) raised the question whether a case stated for the opinion of the court, which, in the alternative, was to be referred back to the arbitrator, and in which an order had been made for reference back to the arbitrator, was appealable. No doubt this case was before the Arbitration Act 1889 and therefore the effect of sect. 19 of that Act could not be considered, but it is an authority to show that under conditions similar to those in the present case, an appeal would lie, unless it is held that the arbitrator intended to proceed under sect. 19. The decision was that of Sir George Jessel, M.R. and Lindley, L.J. concurred. The judgment says: "If we differ from the court below, final judgment has to be entered for the defendant, and there is an end of the action." It makes no difference that under later procedure an award can be enforced by an order without the necessity of bringing an action. That case was further considered in Bozson v. Altrincham Urban District Council (1903, 1 K. B. 547), when the question arose whether an appeal from an order made in an action was an appeal from a final order. The case of Salaman v.