Sir John Jackson, Ltd v. Owners of Steamship "Blanche" and Others [1908] UKHL 984
(Before the Lord Chancellor (Loreburn) , Lords Macnaghten , Robertson , Atkinson , and Collins .)45 SLR 984Sir John Jackson, Limited v. Owners of Steamship “Blanche” and Others.Subject_ Ship — Statute — Collision — Limitation of Liability — Charterers — “Owners” — Merchant Shipping Act 1894 (57 and 58 Vict. c. 60), secs. 503, 504. Facts:Charterers by demise are “owners” within the meaning of section 3 of the Merchant Shipping Act 1894, and can, therefore, under that section, claim the benefit of limitation of liability, conferred by sections 503 and 504, in respect of loss or damage caused by the improper navigation of the ship by their servants. [ Cf . section 71 of the Merchant Shipping Act 1906].Judgment of Court of Appeal reversed.Appeal from a judgment of the Court of Appeal ( Sir J. Gorell Barnes, P., Moulton and Kennedy, L.JJ. ), reported (1907) P 254 , under the name of The Hopper No . 66, affirming a judgment of Deane , J., (1906) P 34 .The nature of the case sufficiently appears from the considered judgments of their Lordships, infra.Lord Chancellor (Loreburn) —There is only one question in this case, namely, whether or not charterers to whom a ship is demised can claim the limitation of liability prescribed by section 503 of the Merchant Shipping Act 1894. The appellants so chartered a ship, and in course of her navigation by a master and crew in the charterers' service she was negligently handled and injured another vessel. Both the judge of first instance and the Court of Appeal have decided that the statutory limitation of liability does not apply, because the charterers were not “owners” within the meaning of the section. It is a singular thing that, so far as can be learned, this question has never been raised before. Since 1813 there has been, in one form or another, a limitation expressly applicable to this class of liability. Whether the point has not been raised because no ship under such a charter has been to blame for a collision, or because no one thought in such case the limitation could apply, or because no one doubted that in such case the limitation would apply, cannot be known, and as soon as the decision now under appeal was first given by Deane, J., Parliament interposed. [See the Merchant Shipping Act 1906 (6 Edw. VII, cap. 48), sec. 71.] However, the case must be decided without regard to these reflections. In my opinion this appeal ought to be allowed. If this very elaborate Act of Parliament be examined, I find it impossible to resist the conclusion urged upon your Lordships by the learned counsel for the appellants. The word “owner” is used in very many sections. Sometimes it means registered owner, which is indeed the primary sense. Sometimes it must also include beneficial owner; and in other parts it seems to me that it must of necessity also include a charterer by demise, who has control of the ship and navigates her with his own master and crew; otherwise the operation of the Act becomes impracticable. For example, the salutary provision that wages shall continue to run if not duly paid—section 134 ( c )—would not apply at all where the ship is chartered by demise, for the “owner” could not be in default. Or again, the provisions for notice to the owner and enforcement of charge, contained in section 183, would be futile unless the word “owner” there referred to some one paying wages. Similar instances might be multiplied almost indefinitely, but it is unnecessary to enlarge upon this point, for it does not really admit of dispute. It being thus ascertained that the word “owner” does in some parts of the Merchant Shipping Act 1894 include the charterers by demise, is it so in section 503? I do not know how the proper meaning of this word in each section is to be determined except by considering the object of the section itself. When limitations were first introduced the policy declared in the preamble was the encouragement of shipbuilding in Great Britain. Subsequently a like limitation was applied to foreign ships also. And we must, I think, conclude that the policy of the present section was simply to prevent ruinous damages from being inflicted upon an innocent principal as the consequence of an error of judgment in a difficult and dangerous business by his agents in charge of a vessel. I can perceive no reason that does not equally apply to the registered owner why the present appellant should be subject to an unlimited liability. I cannot doubt that if charterers by demise are to be so subject there will be an end of such charters, and it is difficult to suppose that Parliament desired this. It seems to me that the mischief against which section 503 was intended to provide is not met by construing the word “owners” in the narrow sense, and that therefore the broader interpretation which the word undoubtedly bears in many other parts of the Act ought to be applied here. Accordingly I respectfully advise your Lordships that this order be reversed, and a declaration made as desired by the appellants.Lords Macnaghten and Robertson concurred.Lord Atkinson —The net question for decision in this appeal is new. It is this, Whether the charterer of a ship demised to him under a charter-party such as that given in evidence in this case is entitled, should damages be recovered against himPage: 985 ↓
Page: 986 ↓
Lord Collins concurred.Appeal sustained.Counsel for the Appellants— J. A. Hamilton, K.C.— Dawson Miller. Agents— Thomas Cooper & Sons, Solicitors.Counsel for the Respondents— Butler Aspinall, K.C.— A. D. Bateson. Agents— Pritchard & Sons, Solicitors.