United Kingdom House of Lords Decisions

The condition which must be fulfilled before any obligation can attach to the underwriters is “that the ship hereby insured shall come into collision with another ship or vessel.” These words in their literal sense import that there must be contact between the “Niobe” and such other ship or vessel, causing damage to the latter. There are many ways in which a ship under sail may, without being herself in collison, become liable to bear the whole damages resulting from a collision. Her unjustifiable manoeuvres may occasion the colliding of two or more vessels other than herself without any blame on their part, and in that case the offending ship, and she alone, is responsible for the consequences of her fault. In such a case I should not be prepared to hold that the “Niobe” had in the sense of the policy “come into collision with” the vessels whom she caused to collide, because there would be no ground in fact or law for the suggestion that the “Niobe” ought to be identified with any one of them.

So far as I can discover, none of the learned Judges of the Court of Session indicated an opinion that the clause was so expressed as to cover every kind of liability for collision. They based their decision upon a special rule of law, which has admittedly no application except as between a ship and her tug. They held that the identity which that rule established between tow and tug is so complete that the “Niobe” herself must be considered to have come into collision with the “Valetta” within the meaning of the policy. A sailing-vessel and the steam-tug which has her in tow have frequently been described by eminent Judges as for certain purposes constituting “one ship”—an expression which has been borrowed by text writers, and is familiar to persons conversant with maritime law. The expression is figurative, and must not be strained beyond the meaning which the learned Judges who have employed it intended it should bear. As I understand their use of the expression, it signifies that the ship and her tug must be regarded as identical in so far as the two vessels, with their connecting tackle, must be navigated as if they were one ship, and the motive power being with the tug, must, in order to comply with the regulations for preventing collision at sea, be steered and manoeuvred as if they formed a single steamship; and also, in so far as the ship towed, when she has, as in this case, the control of the tug and the duty of directing the course of the tug in accordance with these regulations, is responsible for the natural consequences of the tug being wrongly steered, through the neglect of her officers or crew to perform that duty. There was therefore a legal connection betwixt the “Niobe” and the “Flying Serpent” which could not subsist between her and any other vessel which her fault might drive into collision with another ship. The “Niobe” was, in the contemplation of the law, one and the same ship with the “Flying Serpent” for all purposes of their joint navigation with a view to avoid the risk of collision, and the fault which led to a collision between that legal composite and the “Valetta” was admittedly the fault not only of the “Flying Serpent” but of the “Niobe.”

I admit the force of the appellant's argument that contracts ought to be construed according to the primary and natural meaning of the language in which the contracting parties have chosen to express the terms of their mutual agreement. But there are exceptions to the rule. One of these is to be found in the case where the context affords an interpretation different from the ordinary meaning of the words, and another in the case where their conventional meaning is not the same with their legal sense. In the latter case the meaning to be attributed to the words of the contract must depend upon the consideration whether in making it the parties had or had not the law in their contemplation. The point thus raised appears to me to be a very narrow one, but in this case the contracting parties are shipowners and underwriters, and the clause in question relates to possible legal liabilities of the ship insured which are entirely dependent upon the rules of maritime law. In these circumstances I have, not without some hesitation, come to the conclusion that they must be presumed to have known the law, and to have contracted on the faith of it.

Lord Selborne and Lord Morris concurred.

Lord Bramwell—It is said that to hold as I do is a narrow construction. I respectfully deny it. I do not construe the words; I simply read them as I should “twice two are four.” The Lord Justice-Clerk came to the conclusion in favour of the pursuer not without hesitation. Lord Young says the collision was just the sort of collision the possibility of which was contemplated by both sides. I suppose, then, he does not agree with the Lord Justice-Clerk, that it would have been far better if more clearly expressed. Lord Rutherfurd Clark doubts if the pursuer is right. Lord Lee agrees with the Lord Ordinary.

It is said that the “Niobe” was, in the contemplation of the law, one and the same ship with the “Flying Serpent” for all purposes of their commercial navigation with a view to avoid the risk of collision. I respectfully deny it. The law does not contemplate anything like it. A most distinguished lawyer, Lord Kingsdown, did

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