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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Carron Co. v. Currie & Co. and Another [1896] ScotLR 33_578 (6 March 1896)
URL: http://www.bailii.org/scot/cases/ScotCS/1896/33SLR0578.html
Cite as: [1896] SLR 33_578, [1896] ScotLR 33_578
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SCOTTISH_SLR_Court_of_Session
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Court of Session Outer House.
v.
Facts:
A shipped coals in a ship belonging to a shipping company whose business was entirely conducted by a firm of shipbrokers. While the ship was still at the port of loading a creditor of A arrested the coals jurisdictionis fundandæ causa in the hands of the ship-brokers. Held that as the shipbrokers had the entire management of the affairs of the shipping company, they were not mere agents, but factors and commissioners, and that the arrestments were rightly used in their hands.
Error in Schedule of Arrestment which held not to invalidate it.
The Carron Company having obtained decree in absence against James Stevenson, Stettin, used arrestments in execution against him on 24th July 1895 in the hands of the defenders, who were designed in the schedule of arrestment as “James Currie & Company, 16 Bernard Street, Leith, owners or managing owners of the s.s. ‘Orient.’”
The “Orient” formed one of a fleet of vessels belonging to the Leith, Hull, and Hamburg Steam Packet Company, a joint-stock company registered under the Companies Acts, but was, in terms of a resolution of the company, registered in name of James Currie and other two shareholders of the company, James Currie being the registered managing owner under the Shipping Acts.
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By No. 22 of the company's articles, James Currie was appointed to the office of manager and head agent of the company, with power to conduct the agency under the firm or style of James Currie & Company. Under his appointment Mr Currie had very wide powers of management, including the chartering of the company's vessels and the sole power of appointing and removing their masters, officers, and crews. He formed a firm of James Currie & Company, all the partners of which were shareholders of the Packet Company. The firm had no other business than that of managing the Packet Company's vessels, for which it was paid a salary. At the time when the arrestment was laid on, the “Orient” was lying in Leith docks, and had on board 290 tons 3 cwt. of coal belonging to Mr Stevenson, which was to be carried under a contract for the season. The missives constituting the contract had passed between James Stevenson and the defenders, who, although writing on paper belonging to the Packet Company and bearing the printed heading “Leith, Hull, and Hamburg Steam Packet Company, James Currie & Company, managers,” did not sign as managers but simply in their firm's name. Some little time after the arrestments were laid on, the defenders signed a bill of lading for the coal in name of David Dewar, who was Stevenson's shipping agent in Leith, but it was ultimately admitted that they knew that the coal was Stevenson's.
Argued for the pursuers—James Currie & Company were really managing owners of the “Orient.” James Currie in point of fact was registered as such; he was allowed to carry on the business in name of James Currie & Company, who were managers, and every one of the partners was a part owner of the vessel— Hibbs, L.R., 1 Q.B. 534; Abbot, p. 1155. In any event, the defenders were sufficiently designed in the schedule of arrestment apart from the description “owners or managing owners.’ These words were merely meant to point out that the arrestment was used in their hands as being connected with the “Orient,” and the error, if it was one, was too slight to invalidate the arrestment. The defenders being in the sole and exclusive control of the “Orient,” the arrestments were properly used in their hands—Stair, iii, 1, 24; Ersk. iii, 6, 4; 2 Bell's Com. p. 70; M'Donald v. Wingate, 3 S. 494; Johnston v. Dundas’ Trustees, 15 S. 904; Kellas v. Brown, 18 D. 1089; Matthew v. Fawns, 4 D. 1242; Craig v. Thomson, 9 D. 409; Telford's Executors v. Blackwood, 4 Macph. 369; Young v. Aktiebolaget Of verum Bruk, 18 R. 163; 1 Bell's Com. 552.
Argued for the defenders—The defenders were not managing owners of the “Orient.” They were merely managers. The position of managing owners was statutory, and was defined by the Merchant Shipping Act 1894, 57 and 58 Vict. cap. 60, sec. 59. The arrestment was therefore bad— Henderson's Executors and Others, 9 S. 618; Graham v. Macfarlane & Company, 7 Macph. 640. The arrestment of goods on board ship could only be in the hands of the owners or of the master. If pursuers' argument was sound, arrestments might be used in hands of brokers for several fleets of goods on board any vessel of the fleet. Arrestments must be in hands of principal, the only exception being the case of the ship captain. Arrestment in the hands of the agent of the debtor of the common debtor is bad— Graham v. Macfarlane & Company, 7 Macph. 640; Hay v. Dufourcet & Company, 7 R. 972; Young v. Aktiebolaget Of verum Bruk, 18 R. 163; Muirhead v. Miller, M. 732; Donaldson v. Cockburn, M. 735; Hunter v. Lees, M. 736; Campbell v. Faikney, M. 742.
On 6th March 1896 the Lord Ordinary (
Opinion.—“The pursuers obtained decree against the defender James Stevenson of Stettin for the sum of £461, 5s., and they then used arrestments in the hands of James Currie & Company of Leith as owners or managing owners of the s.s. ‘Orient.’
“There were on board the ‘Orient,’ which was lying in the harbour of Leith when the arrestments were used, some 300 tons of coal, which it is not now disputed belonged to Stevenson, and the question is whether the coals were validly arrested in the hands of Currie & Company.
The ‘Orient’ is one of a fleet of vessels belonging to the Leith, Hull, and Hamburg Steam Packet Company, which is an unlimited company registered under the Companies Acts.
All the partners of Currie & Company are shareholders in the Steam Packet Company, and the sole business of Currie & Company is to manage the ships of the Packet Company. James Currie senior is the registered managing owner of the Packet Company, and the position of his firm is shewn by the articles of association of the company. By art. 22nd James Currie is appointed to the joint office of manager and head agent, and by art. 23rd it is provided that ‘he shall be entitled to conduct the agency under the firm or style of James Currie & Company.’ The remuneration which James Currie receives from the company is divided among the partners of his firm under an arrangement among themselves.
The firm of James Currie & Company manage the whole affairs of the Packet Company, and they are in the habit of entering into charters and other contracts in their own name. In the spring of 1895 they made a contract with Stevenson whereby he agreed to fill with coal the spare room in the regular steamers from
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The way in which the contract was carried out appears to have been this—Sometime before the sailing of a ship, Currie & Company told Stevenson's agent in Leith what spare room would probably be available, and he ordered the necessary amount of coal from colliery companies with whom Stevenson had contracts. The coal was then forwarded by rail, and one of Currie & Company's clerks arranged for its being put on board. That was what was done in regard to the consignment of coals in question. The bill of lading was brought by Stevenson's agent to Currie & Company's office, where it was signed by one of their clerks ‘pro Master.’ The arrestments were used before the bill of lading was signed.
It is clear that Currie & Company were not owners of the ‘Orient,’ and I do not think that they can be properly described as ‘managing owners’ because although each of the individual partners was a part owner, and James Currie was managing owner, the firm, as a firm, was not an owner at all. The firm was head agent or manager for the owners and nothing more. It therefore seems to me that Currie & Company were not accurately designed in the schedule of arrestment. I do not, however, think that that is sufficient to invalidate the arrestment if it was otherwise properly used against Currie & Company. The object of the designation was to show that the arrestment was used in the hands of Currie & Company only in the capacity of being the person having control of the steamer, and not in any other capacity in which the firm might be in possession of money or goods. If they had been designed as ‘managers’ of the steamer, I do not think that arrestment could have been impugned on the ground of misdescription, and looking to the purpose which the designation was intended to serve—namely, to specify the capacity in which the arrestment was laid on—I think that to hold the arrestment bad on the ground of misdescription would be to give undue weight to a mere technicality.
The first question therefore comes to be, whether the coal can be regarded as having been in the possession of Currie & Company when it was put on board the steamer. I think that it is clear that so long as the steamer was at the port of Leith taking in cargo, the coal continued to be under the control of Currie & Company. No doubt there may be a power of control without the possession requisite to found arrestment— Hunter, M. 736; Young, 18 R. 163. But the power of control is an important element in considering whether there is or is not possession.
Further, it was Currie & Company who, as I have already said, took possession of the coal when it was brought forward by the railway company, in that they undertook the arrangements for having it put on board.
It was further proved that the master of the ship has nothing to do with the loading, and does not go on board until the ship is ready to sail, and he does not grant bills of lading.
It was also argued by the pursuers that Currie & Company had contracted with Stevenson in their own name, and that they were parties who were liable to him.
The terms of the contract are stated in a letter dated 28th January 1895, written by Currie & Company to Stevenson's agent in Leith. It runs thus:—‘That you will fill the spare room for cargo with coals as required by us in our regular steamers from Leith or Grangemouth to Stettin during the shipping season of 1895.’ The contract was confirmed by a letter from Stevenson himself to Currie & Company dated 2nd February 1895. Now, no doubt Currie & Company's letter is expressed as if they were making a contract for themselves as principals, and it is signed with the firm's name without any addition of such words as manager or agent for the Packet Company. Unfortunately the original letter is not produced but only a copy. If, however, the letter was written—as no doubt it was—on Currie & Company's ordinary business paper, there would appear at the top in print, the words ‘Leith, Hull, and Hamburg Steam Packet Company. James Currie & Company, managers.’ Now, if that were so it might be sufficient notification that Currie & Company were acting only as agents, and in that case Stevenson's contract would be with the principals. That question however was not argued, and I do not express any opinion upon it, but I cannot assume that Currie & Company came under any direct obligation to Stevenson in regard to the coal.
The position of matters appears to me to have been this. The vessel was lying in harbour under the sole control of Currie & Company, and was being loaded under their directions and superintendence, and the coal when it was brought alongside was taken possession of and put on board by them.
In these circumstances it seems to me that Currie & Company had the custody of the vessel and the cargo. As I have said, the master was not on board, and the crew are the servants of Currie & Company in this sense, that under the articles of association the manager has the sole power of appointing and removing the masters, officers, and crews of the company's vessels. I therefore think that Currie and Company had sufficient possession to warrant the use of arrestment in their hands, and the next question is, whether it is competent to use arrestments in the hands of an agent.
Mr Bell in his Commentaries (vol. 2, p. 71) after stating the general rule that an arrestment is not good in the hands of a factor or steward, says—‘But where the arrestment is used in the hands of a commissioner to whom the general management of one's affairs are committed, it will be as effectual as if used in that person's own hands.’ That is a proposition which although it does not seem to have been illustrated by decision, has, I think, always been regarded as a sound statement of the law. Now, I think that Currie & Company
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I may refer to the case of Matthew v. Fawns, 4 D. 1242, which approaches more nearly than any other of which I am aware to the present case. There certain packages of furniture addressed to Pawns arrived in Dundee by one of the ships of the Dundee, Perth, and London Shipping Company, of which Matthew was manager in Dundee. On the day on which the ship arrived in port the furniture was arrested in the hands of Matthew as belonging to one Crom. Delivery of the furniture was demanded by Fawns which Matthew refused without judicial authority. In proceedings taken by Fawns to enforce delivery it was held that Matthew was warranted in refusing delivery in face of the arrestment. Now, of course, there was no direct decision as to the validity of the arrestment, but there was no suggestion that it was bad because it was made in the hands of the manager of the Shipping Company and not of the company itself. As Fawns was claiming that the furniture which was addressed to him should be delivered to him, it is plain that the question whether arrestment was competent in the hands of an agent for the Shipping Company was material to the issue raised. The argument, however, was directed entirely to the question whether Matthew was or was not entitled to disregard an arrestment used by a creditor, not of Fawns but of a third party, and as I have said, it was not suggested either in the pleadings or in the opinions of the Judges that the arrestment was invalid because used in the agent's hands. I may add that I have looked at the session-papers, and I gather that the arrestment was used after the ship had arrived in harbour but before the goods arrested were discharged. I observe also that in the case of Kellas v. Brown (18 D. 1089) Lord Neaves quotes the case of Matthew as an authority for the preposition that the manager of a carrier having the actual charge and custody is a proper person to receive arrestments.
In the case of Kellas the question was whether arrestments used in the hands of a shipmaster were good, and the Court held that they were. It seems to me that all the considerations which led Lord Neaves (whose judgment was affirmed) to hold that the arrestment was good in the hands of the shipmaster are applicable to the case of Currie & Company.
The defenders contended that if the arrestment in this case was held to be good it would not only introduce a novelty into the law but would have very far reaching and serious results. They argued that it would result in this, that if a shipbroker had (as often happens) the management of all the liners of some large company, arrestments might be used in his hands of cargo on board any of the ships wherever they might be. I do not think that would be the result at all. I do not think that the arrestment in this case would have been good if the ship had set sail, because neither the ship nor the cargo would then have been in the charge or custody of the defenders. My grounds for holding that the arrestment was good are (1) that the defenders had the sole and uncontrolled management of the ordinary affairs of the Packet Company, and (2) that so long as the ‘Orient’ was in harbour and taking in cargo, the cargo was under the control and charge of the defenders and of no one else.”
Counsel for the Pursuer— Guthrie— Chree. Agents— John C. Brodie & Sons, W.S.
Counsel for Defenders— Dickson— Salvesen. Agents— Beveridge, Sutherland, & Smith, S.S.C.