Scottish Court of Session Decisions

Samuel Keith Barnetson, shipbroker, Methil, Fife, having used arrestments ad fundandam jurisdictionem, raised an action in the Sheriff Court of Stirling at Falkirk against Petersen Brothers, Flensburg, Germany, owners of the s.s. “Rocklands,” for payment of an account for services rendered and disbursements made for the “Rocklands” at the port of Methil.

On 11th January 1900 a charter-party was entered into between the defenders and Gans & Sell, their agents in Scotland, under which the Rocklands was chartered to carry a cargo of coal from Methil to Kjöge, in Norway. Under this charterparty ninety-six running hours were allowed for loading and discharging, to be effected within four running working days. “Time for loading to count from first highwater after arrival roads from the time the master has got his ship ready to receive cargo and reported her as ready for cargo to charterers or their agents in writing during business hours.” The charter-party contained a clause permitting re-chartering “at any rate of freight, but otherwise on the same conditions.”

It was not maintained that the ship had been demised to Gans & Sell,

The defenders' agents Gans & Sell on 11th January re-chartered the vessel to Burns & Lindemann, merchants, Glasgow, for a voyage from Burntisland or Methil to Kjöge with a cargo of coal. This charterparty provided as follows:—“Steamer to be loaded in forty-eight running hours, commencing to count when ready to receive cargo, reported at Custom-House, berthed, and written notice given to charterers or their agents within office hours,… and to be discharged, weather permitting, in four running working days.

On 26th January Gans & Sell wrote to the pursuer advising him that the “Rocklands” was due at Methil on the 29th, and placing her business in his hands.

The “Rocklands” duly arrived at Methil, and the necessary services were rendered and the usual disbursements made on her behalf by the pursuer.

After sundry correspondence and communications with Gans & Sell and Burns & Lindemann, the nature of which sufficiently appears from the Sheriff-Substitute's interlocutor and note, infra, the pursuer rendered his account for services and disbursements to the defenders, and upon their refusal to pay he raised the present action, in which he concluded for payment of his account.

The items in the account sued for, as summarised, were as follows:—

Pilotage, Towage, Dock Dues, Dock Lights, … .	£15	11	5
Trimming Cargo and Bunkers,	10	11	4
Water,. Consulage, Boatmen, Telegrams and Telephones, Postages and Petties, Clearance, Exchange, and Noting Protest,	4	19	9
Cash to Captain,	15	0	0
2 per cent. add. Comm.,	7	1	0
	£53	3	6

The pursuer pleaded—“(4) Pursuer having been employed under said charterparty to make the disbursements sued for on behalf of defenders' vessel, defenders are liable in direct payment thereof to pursuer.”

The defenders pleaded—“(3) The pursuer not having been employed by the defenders, the defenders should be assoilzied with expenses. (4) The pursuer having been employed by the said Gans & Sell,

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and the disbursements having been made for them and not ‘on defenders’ credit, the defenders should be assoilzied with expenses.”

When the present action was raised a litigation was pending between the defenders and Gans & Sell with regard to certain claims by the former against the latter, and the defenders stated that in their accounts with Gans & Sell, and in said action, they gave credit for the disbursements made at Methil which were now sued for by the present pursuer.

After a proof in which, inter alia, the facts narrated above were disclosed, the Sheriff-Substitute ( Russell Bell) pronounced the following interlocutor:—Finds in fact (1) that in January 1900 the steamship ‘Rocklands,’ belonging to the defenders, who are foreigners, was chartered by them to Messrs Gans & Sell of Glasgow, and by the latter in the same month re-chartered to Messrs Burns & Lindemann, also of Glasgow, for a voyage from Methil in Fife to Kjöge in Norway; (2) that the pursuer, who is a shipbroker in Methil, was instructed by the said Gans & Sell to do what brokerage was required on said vessel while in the port of Methil, and that he acted on said instructions and did said brokerage; (3) that he rendered his account therefor to the defenders, and also claimed reimbursement from the said Gans & Sell; (4) that the pursuer has failed to prove that a contract of employment existed between the defenders and him: Finds in law that the defenders are not liable to the pursuer for the amount of the account sued for: Therefore assoilzies the defenders,” &c.

Note.—… “I think the whole circumstances disclose a case of privity of contract (1) as to the chartering of the ship between the defenders and Gans & Sell; and (2) as to the brokerage between Gans & Sell and the pursuer, but none between the defenders and the pursuer. There is nothing to show that the defenders held out Gans & Sell to the pursuer as their agents and to pledge their credit, and so the case stops short of the question with which it started, of whether an agent in this country can pledge the credit of a foreign principal. There is no relation between the parties to the case until pursuer rendered his account to the defenders, and all that the latter do, quoad the pursuer, is to repudiate liability. The inference is to me irresistible that but for Burns & Lindemann's hint as to the financial instability of Gans & Sell the pursuer would never have thought of claiming against the defenders directly. The existence of the subcharter to Burns & Lindemann does not affect the case if I am right in holding that the pursuer's contract was with Gans & Sell. The process is rather a chaotic one, there being produced a great deal of correspondence which has reference to disputes which have no connection with the case.”

The pursuer appealed to the Court of Session, and argued—The Sheriff had proceeded on the ground that there was no contract between the pursuer and defenders, but therein he had erred. That the disbursements made by the pursuer were necessary was not disputed, and the defenders had taken the benefit of them, and their captain had accepted the pursuer's services—Bell's Pr. 450, Bell's Com. i. 571; Abbot's Law of Shipping, Part 2, cap. 2 and 3; North Western Bank v. Bjornstrom, November 9, 1866, 5 Macph. 24, Lord Benholme p. 28, 3 S.L.R. 14; Meier & Company v. Küchenmeister, March 17, 1881, 8 R. 642, Lord Young, p. 646, 18 S.L.R. 431; Benn & Company v. Porret, March 11, 1868, 6 Macph. 577, 5 S.L.R. 353; Stewart v. Hall, November 10, 1813, 2 Dow 29. The law relied on for the defenders with regard to principal and agent did not apply, and the terms of the sub-charter did not affect the present question.

Argued for the respondents—The only charter party authorised by the defenders was that between themselves and Gans & Sell, who had exceeded their authority by the terms of the sub-charter, which they had entered into for their own benefit, and wherein they had ceased to be agents and become principals. The Sheriff had rightly held that the defenders had no contract with the pursuer. The pursuer's contract was with Gans & Sell, and his contract with the defenders' agents did not bind the defenders. When an agent acted for a foreign principal the presumption was that the agent was exclusively liable under any contract he entered into, unless the terms of the contract made it clear that the principal alone was to be bound—Bell's Com. i. 543, note. A foreign principal was not bound by a contract entered into by his agent unless he had given the agent authority to make him a party to the contract— Girvin, Roper, & Company v. Monteith, November 13, 1895, 23 R. 129, 33 S.L.R. 73.

At advising—