Scottish Court of Session Decisions

By charter-party dated 30th December 1890 the barque “Theodor Korner” was taken bound to load “a full cargo, to consist of square pitch pine sawn timber, merchants to supply timber and/or deals and/or boards at their option for beam fillings and broken stowage,” and “being so loaded shall therewith proceed to any safe port in the United Kingdom … and deliver the same (always afloat) on being paid freight as follows—

For Timber for Cargo,	£	s.	d.
For Sawn Timber for Cargo,	4	7	6
For Deals and/or Boards for Cargo,	4	7	6
For Timber and/or Deals and/or Board used for Beam Fillings and Stowage, p. St. Petersburg Standard Hundred of 165 cubic feet.	Two-thirds above rates.

… 3. Freight to be paid as follows—One-third in cash on arrival, and the remainder after unloading and on right delivery of the cargo by a good and approved bill payable in London at four months' date following, or in cash, less two per cent. at owner's option. Freight upon deals and/or boards to be paid upon intake measure of quantity delivered. … 6. Twenty-two working days are to be allowed the merchants in which to deliver the cargo at port of loading … and the cargo to be unloaded as customary at port of discharge, at such wharf or dock as the charterers or their agents may direct, and ten days of demurrage over and above the said lying days, at Eighteen pounds per day. … 11. The custom of the wood trade of each port to be observed in all cases when not specially expressed. 12…. The master or owners to have a lien on cargo for all freight, dead freight, and demurrage.”

In the bill of lading dated at Pensacola 21st January 1891 it was stated that the cargo of timber and deals had been shipped in good order and condition, and were to be delivered in the like good order and condition at the Port of Glasgow. The bill of lading, which incorporated the conditions of the charter-party, was indorsed to Messrs M'Dowall & Neilson, timber merchants, Glasgow, as purchasers or assignees of the cargo.

On 15th May 1891 the vessel arrived at Glasgow. Messrs M'Dowall & Neilson directed the shipmaster, Abraham Thorsen, to discharge at the Queen's Dock. As the state of traffic at the Queen's Dock at that time was such as to forbid the unloading of timber, the harbourmaster refused to allow the vessel to discharge there, and assigned the vessel a berth for the discharge of her cargo at Yorkhill, near the foreign animals wharf, where there was only a narrow passage between the slaughterhouse and the wharf, and no appliances for unloading timber and deals upon the quay. To this arrangement Messrs M'Dowall & Neilson submitted and the shipmaster berthed the vessel at Yorkhill and commenced discharging the cargo into the water. Over a third of the whole freight had been paid before the ship arrived in the Clyde, but on 29th May, after a portion of the cargo had been discharged in excess of that for which freight had been paid, the shipmaster demanded payment from the consignees of the sum of £190, being the freight still unpaid for delivered cargo. He further demanded either security for payment of the balance of freight to become due or payment of the freight applicable to each standard as it was delivered. The consignees refused to accede to these demands and the shipmaster

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stopped discharging the cargo. After negotiations between the parties the consignees paid the sum of £190 and gave security for the balance of the freight.

On 2nd June the shipmaster recommenced discharging. The timber was discharged into the river and floated down to Port Glasgow. The deals also were discharged into the river, and after they had lain about a fortnight in the river, the shipmaster, at the request of the consignees, caused them to be towed up to the Queen's Dock and placed on the quay there, where the consignees took delivery.

On account of the immersion of the deals for a fortnight in the river Clyde, they were injured by water and by the sewage and filth of the river. The consignees estimated the damage thus done at £56, 4s. 7d., and as they held that the deals should have been delivered by the shipmaster at once on to the wharf, and not allowed to remain in the river for some days, they deducted the above sum before paying the freight which they still owed to the shipmaster.

In these circumstances Abraham Thorsen, the shipmaster, as representing the owners of the “Theodor Korner,” and Lietke & Company, shipbrokers, Glasgow, their mandatories, raised two actions in the Sheriff Court at Glasgow against M'Dowall & Neilson, the consignees.

In the one action the pursuers sued for £56, 4s. 7d. as balance of freight. In the other action the pursuers sued for £36 as two days' demurrage alleged by them to have been incurred by the fault of the defenders in delaying to pay the freight due on 29th May, whereby the ship was obliged for her own protection to stop delivery.

One proof was taken in both actions before the Sheriff-Substitute ( Guthrie) which disclosed the facts above narrated. The evidence showed that it was unusual for a cargo of timber and deals to be brought to Glasgow, such cargoes being generally discharged at Greenock or Port Glasgow. There was also evidence that cargoes of timber and deals had been discharged directly on to the quay from vessels berthed at Queen's Dock, but there was no evidence of such a thing having been done at Yorkhill.

On 23rd December 1891 the Sheriff-Substitute pronounced the following interlocutor in the action for the balance of the freight—“Finds that the pursuers, as owners of the barque ‘Theodor Korner,’ failed to deliver the deals loaded under the charter-party and bill of lading, in like good order and condition, at the Port of Glasgow, as contracted for: Finds that the deals were damaged to the amount of £40 sterling, and to that extent sustains the defences; decerns against the defenders in favour of the pursuers for the admitted balance of freight due, viz.—£16, 4s. 7d., with interest, as craved: Finds the defenders entitled to expenses;” And the following interlocutor in the action for demurrage—“Finds that the detention of the ship ‘Theodor Korner,’ for which the pursuer asks demurrage or damages, was caused by their own act and not by the defenders: Therefore assoilzies the defenders, and decerns: Finds the defenders entitled to expenses.”

The pursuers appealed to the Second Division of the Court of Session, and argued—(1) In action for Freight—The ship was ordered by the harbourmaster to a berth where it was impossible to land the cargo on the quay. This order was acquiesced in by the defenders. The defenders therefore acquiesced in the cargo being discharged in the only way in which it could be discharged at that particular place, viz., into the water. They had therefore no right to refuse payment of the balance of freight due. (2) In action for Demurrage—There were three clauses in the charter-party dealing with the mode in which freight was to be paid. Two of these clauses, viz., the first and twelfth, agreed with one another, and being in a majority they should prevail. That being so, the pursuers were entitled to get a proportion of the freight for the cargo on delivery of each standard. The shipmaster asked for this on 29th May, or alternatively for security that the freight would be paid, and on the defenders refusing this just demand he stopped delivery for his own protection. The ship was therefore detained by the fault of the consignees, who were liable for demurrage— Lamb v. Kaselack, Alsen & Company, January 31, 1882, 9 R. 482.

Argued for the defenders—(1) In action for Freight—The bill of lading required the shipowners to deliver the cargo in as good condition as when they got it on board. This they had not done when they put the deals upon the quay and the defenders took delivery; the deals were much deteriorated by the filth of the Clyde. When the ship got to Glasgow the defenders had directed the master to discharge her at the Queen's Dock. This he had not done. The ship went instead to Yorkhill and discharged her cargo into the water by reason of which the deals were damaged. Even if the shipmaster was bound to obey the harbourmaster, he should either have discharged the deals directly on to the quay at Yorkhill or made a raft of timber and placed the deals on that, and then towed them to the nearest quay and lifted them thereon. But instead of doing so he discharged the deals into the dirty river and allowed them to lie therein a fortnight. The shipowners were therefore bound to make good the damage caused to the deals by their protracted immersion. (2) In action for Demurrage—No demurrage was due. The mode of payment of freight was expressly laid down in the third clause of the charter-party. This mode of payment had been carried out by the defenders. When on 29th May the demands of the master were not complied with, even if he believed that his demands were justified, he ought to have gone on unloading, at the same time holding possession of the cargo till freight was fully paid. But he had no right in any event to turn his ship into a

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warehouse and keep possession of the cargo without unloading it at all—Bell's Comm. i. 558.

At advising—