Scottish Court of Session Decisions

Thomas Hamling & Company, Limited, Hull, registered owners of the steam trawler “St Clair” of Hull, pursuers, for themselves and as representing the master and crew of the vessel, brought an action against A. Pedersen, master of and as such representing in this country the ownership of the sailing vessel “Audny” of Christiania and the owners of the cargo, defenders, for payment of £10,000 for salvage services rendered to the defenders. Arrestments were used to found jurisdiction. Similar actions were brought by the owners of other vessels in respect of similar services rendered and the different actions were conjoined. Bail bonds to the amount of £37,500 were taken by the owners of the vessels.

On 20th July 1920 the Lord Ordinary ( Hunter) allowed the parties to the conjoined actions a proof of their averments and to the pursuers a conjunct probation.

The following narrative of the facts and of the import of the proof so far as relevant to the question here reported is taken from the opinion of the Lord Justice-Clerk—“Ten actions for salvage were raised against the Norwegian ship ‘Audny.’ Some of the pursuers arrested the ship, and only released the arrestments on an undertaking being given that the vessel would not leave until after adjustment of their claims. All the pursuers made large claims. These amounted in cumulo to over £46,000. The bail bonds, I think, totalled £37,000. The Lord Ordinary before the proof conjoined the actions with the proviso that any wit ness could be cross-examined by any of the parties. The proof occupied several days and in the end the Lord Ordinary found that all the pursuers had performed salvage services, and were entitled to succeed to a certain extent in their claims for salvage, but he allowed in each case very much less than what had been claimed. The proof was complicated by the fact that there were internecine disputes between the salvors as regards certain damages done to the ‘Audny’ in taking her into Aberdeen Harbour and as to the liability for these. The Lord Ordinary having heard counsel upon the evidence made his awards for the salvage services rendered. He then found the pursuers entitled to their expenses, which he modified in the way set out in his interlocutor, the modifications being in different proportions in regard to the different vessels, which shows that he had carefully applied his mind to the matter when he was in the full knowledge of the facts. He then remitted the accounts to the Auditor for taxation. Having disposed of the expenses the Lord Ordinary next dealt with a question which was raised on record in a passage to which we were referred in the action at the instance of Hamling & Company, who were owners of the ‘St Clair’ of Hull. Thereupon a proof was taken upon the questions raised in that answer. I do not know that the first witness, Mr Duncan, advocate, Aberdeen, gives much material evidence upon the point; but the second witness, Mr Sopwith, gives the charges which would be made in Norway. He was acting on behalf of the underwriters of the salved ship. He says—‘The Norwegian banks’ charge is 10s. per cent. per quarter—about 2 per cent. per annum—and they are not like bail bonds in this country. For the bail here I think the charge is 1 per cent. for an indefinite time, but the Norwegian banks charge the bail bond that goes on in continuity until the bail has been released, so that for every three months the matter is delayed there is another 10s. per cent.’ Now it is quite true, as Mr Carinont said, that that only put before the Lord Ordinary the rates which would be charged in Norway and in London, the former being, I suppose, thought relevant because the salved ship is a Norwegian ship and the underwriters Norwegians. The English rule appears to be in the Order as in Roscoe's Admiralty Practice, Order 12, Rule 21 ( a)—‘A commission or fee paid to a person becoming surety to a bail bond or otherwise giving security may be recovered on taxation; provided that the amount of such commission or fee shall not in the aggregate exceed one pound per centum on the amount in which bail is given.’ ”

On 23rd February 1921 the Lord Ordinary

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gave decree in favour of the pursuer for payment of £700, and in the other actions awarded sums considerably less than the amounts claimed, the total amount awarded being £4925. He further found the pursuers “liable to the defenders in the charges incurred in connection with the bail bonds or guarantees taken in security of their salvage claims to the extent to which the said bail bonds or guarantees exceed the sum of £8000.”

Opinion.—[ After dealing with the merits—“I have already indicated that the ‘Audny’ was arrested, and that large claims were made against her by the owners of the salving vessels. Bail bonds or letters of guarantee were taken by the owners of the said vessels to the amount of £37,500. I consider that the bail demanded was exorbitant. It was said in excuse that the agents of the salvors did not know the value of the salved vessel, but I cannot look upon that circumstance as a satisfactory explanation for their action. In the case of the ‘ George Gordon,’ 1884, 9 P.D. 46, an action of salvage was brought by the owners of two tugs against a vessel of the value of £14,000. The action was commenced for the sum of £3000, and bail had been required and given for that amount. The Court awarded £450. Mr Justice Butt said—‘Parties should not arrest a ship for an exorbitant sum, and if they do it is no excuse to say that the defendants did not, as it were, struggle to get free by applying to have the bail reduced, nor that the solicitors were ignorant of the facts of the case at the time of the arrest. Where it is possible they should ascertain the circumstances before the ship is arrested. The course taken in this case I will never sanction, and I therefore order that the plaintiffs do pay all the costs and expenses to which the defendants have been put by finding bail in the action.’ In the case of the ‘ Marguerite Molinos,” [1903] P 160, Mr Justice Bucknill ordered the salvors to pay the bail fee above a sum twice the amount of the award. In the present case I order the salving vessels who got bail bonds or guarantees to pay the expenses connected therewith so far as in excess of £8000.”

The pursuers, Thomas Handing & Company, Limited, and certain others reclaimed, and argued, inter alia, with respect to that part of the Lord Ordinary's interlocutor which dealt with the expenses of the bail bonds—The Lord Ordinary had proceeded on English authorities which were appropriate in the English Courts but which did not apply in Scotland. In England the expense of procuring a bail bond was an expense of process and could be modified. In Scotland it was not an expense of process— Ellerman's Wilson Line v. Commissioners of Northern Lighthouses, 1921 S.C. 10, 58 S.L.R. 29; “ George Gordon,” 1884, 9 P.D. 46. The defenders could have presented a petition for recall and had the amount reduced. [The Lord Justice-Clerk referred to Roscoe's Admiralty Practice, 4th ed., p. 312, Order XII, Rule 21 ( a), and note referring to “ The Numida,” (1885) 10 PD 158]. The only Scots case in which the English rule had been given effect to was The Walker Steam Trawl Fishing Company, Limited v. The Mitre Shipping Company, Limited, 1913, 1 S.L.T. 67, which was an Outer House decision.

Counsel for the respondents were not called on.