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Cite as: [2003] ScotCS 297

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Atlantic Computing Services (UK) Ltd v. Burns Express Freight Ltd [2003] ScotCS 297 (02 December 2003)

SECOND DIVISION, INNER HOUSE, COURT OF SESSION

Lord Justice Clerk

Lord Osborne

Lord Johnston

XA39/03

OPINION OF THE COURT

delivered by LORD JOHNSTON

APPEAL

From the Sheriffdom of North Strathclyde at Paisley

in the cause

ATLANTIC COMPUTING SERVICES (U.K.) LIMITED

Pursuers and Respondents;

against

BURNS EXPRESS FREIGHT LIMITED

Defenders and Appellants;

_______

Act: Reid, solicitor advocate; Maclay Murray & Spens

Alt: McNeill; Simpson & Marwick

2 December 2003

[1] This case is concerned with the applicability, or otherwise, of section 17 of the Mercantile Law Amendment (Scotland) Act 1856 (the 1856 Act) in respect of goods damaged during the currency of a contract of carriage, the casualty taking place in England.

[2] The particular facts are not essentially in dispute.

[3] The defenders entered into a contract of carriage to convey certain goods belonging to the pursuers from their premises in southern England to Glasgow. On the M25 the lorry caught fire and the goods were extensively damaged, apparently by water and smoke. The pursuers raise this action to seek to recover damages for that loss.

[4] Condescendence 4 raises a claim in relation to section 17 of the 1856 Act which is in the following terms:

"All carriers for hire of goods within Scotland shall be liable to make good to the owner of such goods all losses arising from accidental fire while such goods were in the custody or possession of such carriers".

[5] Before the sheriff a lengthy debate appears to have taken place concerning essentially questions of conflict of laws which was attempted to be resuscitated before us on both sides. For reasons which will become clear, we do not see that any such question of conflict arises in this case. We consider the issue is essentially one of interpretation of the provisions of section 17.

[6] In this respect the substance of the sheriff's judgment, which is not always easy to understand, would appear to be that he determined that the section related to any contract of carriage when goods are damaged by accidental fire, provided the carrier was Scottish. He thus refused to sustain the plea to the relevancy tabled by the defenders and hence the appeal by the defenders to us and on that point. No other point of appeal is taken in the case before us.

[7] As we have indicated the submissions for both sides dwelt on issues of private international law. Counsel for the defenders and appellants submitted that, properly understood, section 17 raised a delictual obligation which in this case will be covered by the law of England because the delict, namely the fire, had taken place in England. He submitted that the presumption that would apply to that general rule was not rebutted by any Scottish connections in the present case (see Private International Law (Miscellaneous Provisions) Act 1995, sections 11 and 12). Counsel pointed out to us that the sheriff had been against the defenders on this point but, as we have indicated, we think it is nothing to the point.

[8] The solicitor advocate for the pursuers and respondents submitted that, properly understood, the obligation in section 17 was a contractual one to which the law of Scotland applied and this was the core of his submission when it came to the issue of interpretation.

[9] When both advocates came finally to address the issue of interpretation the position adopted by counsel for the appellants was that, properly construed, the provision applied when the casualty took place within Scotland, i.e. the location of the fire and that "within Scotland" meant within the geographical limits of the country of Scotland and since in this case the fire took place in England the provision could not apply. He accepted that in a contract of carriage being effected across the border the provision would not start to apply until the goods had entered Scotland, but he saw nothing illogical in that position.

[10] The stance taken by the solicitor advocate for the respondents was that adopted by the sheriff, namely that the section should be interpreted so as to apply to any Scottish carrier and the location of the casualty mattered nothing to the point. He submitted that a Scottish carrier was a carrier with a place of business in Scotland.

[11] In seeking to resolve this matter we would make two initial observations.

[12] Our researches have revealed a history to the legislation which is straightforward and well documented. There was considerable dissatisfaction among merchants in the United Kingdom in the period 1852-1853 arising from differences between the laws of England and Scotland on numerous matters of everyday occurrence (L. C. Cranworth, 26 Feb. 1856; (140) H. Deb, cols. 1392ff). In June 1853 a Royal Commission was appointed to enquire into these problems with a view to the assimilation of the two systems of law on numerous specific points. One of many such differences was that in England carriers were liable for loss caused by accidental fire to goods in their care (Forward v Pittard, 1 (1785) T.R. 27; Hyde v Trent and Mersey Navigation, (1793) 5 T.R. 389) whereas in Scotland they were not (McDonell v Ettles, 15 Dec. 8109, F.C. 460). Having received conflicting representations on the point, the Commissioners recommended in favour of the extension of the English rule to Scotland (Second Report of Commissioners for Inquiry into the Mercantile Laws in the different parts of the United Kingdom (1855), p. 17; Appx. A, s. 47). The recommendations of the report were promptly passed into law in two parallel enactments, the Mercantile Law Amendment Act 1856 and the 1856 Act. Section 17 of the latter Act is the provision under review, and thus should be interpreted in the relevant temporal context.

[13] Secondly, section 21 of the 1856 Act is in the following terms:

"Nothing in this Act contained shall apply to any part of the United Kingdom except Scotland".

[14] At first blush this would appear to be highly relevant to the issue of construction of section 17 as regards any territorial limits and exclude the notion that the section could apply to events occurring in England.

[15] As we have indicated the solicitor advocate for the respondents/pursuers embarked on an exercise against the background of what he maintained to be a conflict of law situation with a view to establishing that Scots law applied to the contract. While this exercise is no doubt interesting, we cut it short upon the basis that we were prepared to approach the matter upon the hypothesis that Scots law was the applicable law to this contract. This meant that the pursuers were not required to establish that position by a process of detailed examination of both the facts and the various statutory provisions regulating such matters in a conflict situation.