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may have been used in a peculiar sense; but it is for the judge to say what the effect of the whole is, when he has been informed of the facts and of any such special meanings. The court it is which when once it is in possession of the circumstances surrounding the contract, and of any peculiarity of meaning which may be attached by reason of the custom of the trade to any of the words of that contract, has to place the construction upon the contract.3

In dealing with the construction of charterparties in every case, it is necessary to look to what is in reality the substance of the contract, and apply common sense to ascertain the meaning of the parties.


In Stavers r. Curling, Tindal, C. J. said :-" The rule has been established by a long series of decisions in modern times, that the question. whether covenants are to be held dependent or independent of each other, is to be determined by the intention and meaning of the parties as it appears on the instrument, and by the application of common sense to each particular case; to which intention, when once discovered, all technical forms of expression must give way." And one of the means of discovering such intention has been laid

1 I. L. C. Act. 1 of 1872. s. 98.

Oppenheim v. Fraser, 31 L. T. 521.

↑ Bowes r. Shand, L. R. 2 App. Cas. 462; 46 L. J. Q. B. 561; Ashforth v. Redford, L. R. 9 C. P. 20; Alexander r. Vanderzee, L. R. 7 C. P. 530.

• Bradford v. Williams, L. R.7 Ex. 259; Valente v. Gibbs, 28 L.J.C.P.235; Crookewit r. Fletcher, 26 L. J. Ex. 159,

3 Bing. N. C. 355.

down with great accuracy by Lord Ellenborough, in the case of Ritchie v. Atkinson,' to be this, "that where mutual covenants go to the whole of the consideration on both sides, they are mutual conditions, the one precedent to the other; but where the covenants go only to a part, there a remedy lies on the covenant to recover damages for the breach of it; but it is not a condition precedent."

One of the questions of this kind which occurs most frequently, in contracts relating to shipping, is whether a covenant be a condition precedent, or an independent covenant. That is, whether a promise made by one party be such, that if he breaks it, this breach is a sufficient excuse for the entire disregard of all his promises by the other party; or is it such, that if he breaks it, the other party is still bound to his promises, but may claim indemnity from him who has broken his promise.

Erle, C. J. said:-"The construction to be put on these contracts depends on the terms of the individual contract, and what we have to look to is, to ascertain the intention of the parties; and whether a particular stipulation is a condition precedent, or an independent stipulation, is to be ascertained by what we consider to have been the intention of the parties expressed in the instrument."

Although the parties may enter into what stipulation they please, the effect of their stipulations

110 East 295.

* Parsons on Sh. Vol. 1, p. 319.

3 Sleger v. Duthie, 29 L. J. C. P. 261; Ollive v. Booker, 17 L. J. Ex. 21.

often depends on the legal construction of the instrument which contains them. This construction is always made by the court, and questions relating to it are questions of law and not of fact. All ΑΠ courts, in construing any instrument, pay great regard to the intention of the parties. This is to be gathered, if possible, from the words they use, aided by whatever evidence is admissible. And if the intention can be ascertained, it is carried into effect, provided the words used will bear this interpretation without any violation of the rules. of legal construction. And in the construction of charter-parties, as of all instruments, a construction which gives effect to all the words and provisions is preferred to one which does not.'

The instrument must be construed according to its natural and grammatical meaning.


The construction to be given to charters is not an unnecessarily strict one, but such an one as with reference to the context and the object of the contract will best effectuate the obvious and expressed intent of the parties.3

Mellish, L. J. in the case of "The Teutonia "4 remarked that-" Although it is true that the court ought not to make a contract for the parties which they have not made themselves, yet a mercantile contract, which is usually expressed shortly, and

Ward . Whitney, 3 Sandf., 399; 4 Seld. 422; Parsons on Sh. Vol. 1, 319. 2 Van Baggen v. Baines, 23 L. J. Ex. 215.

3 Dimech v. Corlett, 12 Moo. P. C. 221; Garston S. S. Co. v. Hickie, L. R. 15 Q. B. D. 580.

L. R. 4 P. C. 171.

leaves much to be understood, ought to be construed fairly and liberally for the purpose of carrying out the object of the parties."

If some of the words of a written agreement, after the whole agreement has been considered, are capable of more than one interpretation, that interpretation is to be preferred which is least favourable to the party upon whom an obligation is imposed, or in whose favour an exception from, or modification of, an obligation is created by those words.1

But when the terms of a contract are too ambiguous to be interpreted by the court, judgment will be given against the party whose duty it was to make it clear.2

When construing a mercantile document which is susceptible of two meanings, if one of the parties has bona fide adopted one of them and acted upon it, it is not competent for the other afterwards to say that he intended the document to be read in the other sense of which it is equally capable. The other should have stated in the document what he did mean in clear and unambiguous terms. "

In the case of Hogarth r. Miller where the contract was for the hire of a ship, Lord Halsbury,

1 Nind v. Marshall, 1 B. & B. 319; McConnel v. Murphy, L. R. 5 P. C. 203 ; Deslandes r. Gregory, 2 E & E. 699; Bastifoll r. Lloyd, 1 H. & C. 295; Taylor e. Liverpool & Gt. W. S. Co, L.R. 9 QB 549; Hudson r. Ede, L. t. 2 Q. B. 578; Ch. Bank of India e Nod I. S. N Co., L. R. 9 Q. B. D. 123; Burton . English, L. R. 12 Q. B. D. 220, 222, 321.

Hengh . Escombe, 4 L. T. N. S. 517.

3 Ireland v. Livingston, L. R. 5 H. L. 395, 416; Furness . White, 63 L. J. Q. B. 267, 275.

* L. R. (1891) A. C. 53,

L. C. observed:-" I think that each part of the contract must be looked at with care, and that it must be remembered that in the construction of the contract we are not bound simply by the exact words. We must remember that it is a mercantile contract, and we must remember the nature of the subject-matter with respect to which each of the parties was contracting."

Lord Ellenborough in Robertson . French' laid down the following principles on this subject:-"The same rule of construction which applies to all other instruments applies equally to this instrument of a policy of insurance. It is to be construed according to its sense and meaning, as collected in the first place from the terms used in it, which terms are themselves to be understood in their plain, ordinary, and popular sense, unless they have generally in respect to the subject-matter, as by the known usage of trade, or the like, acquired a peculiar sense distinct from the popular sense of the same words; or unless the context evidently points out that they must in the particular instance, and in order to effectuate the immediate intention of the parties to that contract, be understood in some other special and peculiar sense."

These principles were cited with approval and adopted by the House of Lords in Glynn v. Margetson & Co.

Although the parties who sign a contract are Construction prima facie responsible for its performance in Clause.

11 East 135; Hart v. Standard Marine Ins. Co., L. R. 22 Q. B. D. 499.


L. R. (1893) A. C. 351; 62 L. J. Q. B. 466,

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