Plaimar Limited v Waters Trading Company Limited [1945] HCA 34

High Court of Australia|1945-07-01|Before: McTiernan JJ, Wolff J

WATERS TRADING COMPANY LIMITED . ReEsponpEn PLAINTIFF,

ON APPEAL FROM THE SUPREME COURT OF WESTERN AUSTRALIA.

H.C. or A. Sale of Goods - Contract - C.i.f. terms - Shipment from original port - Insuraneé

(About) four tons Zanzibar clove oil packed in drums each approx. 5 ev

Sept. 11, 12. Reis it ; F ) cate Price eight shillings and a penny nett landed weight, cost insurance and fi Sypvey, Fremantle, Bank exchange Australia London to buyer's account. Shipmen Nov. 23. - per steamer during October November December 1941 from original Se Insurance W.P.A. for not exceeding the above value plus ten per cent.

and 'McTiernan JJ. ' covered and charged to buyer's account. Terms nett cash against d

Held that the contract, in its leading terms, was a c.i.f. contract. reference to the delivery order gave the seller an option either to wait the goods had arrived and obtain a delivery order and tender that inst the bill of lading, or to tender a bill of lading with the invoice and an in policy. The reference to net landed weight meant only that there m a final adjustment as to price after the arrival of the goods and did not

consigned to Fremantle by a ship bound for Singapore, there to be to a ship bound for Fremantle. The ship from Zanzibar arrived at Si late in December 1941, and the goods were not afterwards heard of,

being lost because of the state of war then existing. The bill of Jadin

tained clauses exempting the shipowner from liability for loss or

only, the carriage of the goods after transhipment being governed by the terms of the bill of lading of the on-carrying ship.

Held, on the facts, that since the route was the only one available, the shipper could not be expected to obtain a more favourable bill of lading.

The policy of insurance taken out by the seller contained an exception in respect of loss at the port of transhipment after the expiry of fifteen days.

Held that this was the usual policy and that the buyer could not demand a more favourable cover,

Decision of Supreme Court of Western Australia (Wolff J.) varied.

Appeal from the Supreme Court of Western Australia.

_ An action was brought in the Supreme Court of Western Australia by Waters Trading Co. Ltd. against Plaimar Ltd. on a contract for the price of goods sold and to be shipped from Zanzibar to Fremantle. The contract was made on 22nd November 1941 in the following terms :- -

" (About) 4 tons Zanzibar Clove Oil guaranteed 90/92% eugenol, "packed i in drums each approx. 5 ewts.

Price eight shillings and a penny (stg.) per Ib. nett landed weight, cost insurance and freight Fremantle. Bank Exchange Australia ~ London to buyer's account.

Shipment - per steamer during October November December 1941 from original port.

Insurance W.P.A. for not exceeding the above value plus 10%.

_ War Risk Insurance - if it can be arranged by seller war risk insurance is to be covered and charged to buyer's account.

Terms. Nett cash against delivery order or bill of lading.

Sellers not responsible for any loss or delay caused by strike direct "or indirect fire force majeure and other circumstances beyond their "control."

The respondent was a company incorporated and carrying on busi- i in New South Wales as a merchant and the appellant was incorporated in Western Australia where it carried on the business of manufacturer. The London agent of the respondent procured the goods and they were shipped at Zanzibar to Fremantle via Singapore on 27th November 1941. It appeared that the goods arrived at apore late in December 1941, but after that date they were not heard of, the probability being that they were lost because of the state df of war then existing at Singapore. The bill of lading was issued to

order and duly indorsed and was sent through the Bank of Australasia d., Sydney. From Sydney, it was sent to Messrs. W. H. Evans , in Perth, who passed it on to Messrs. Grieve & Piper, customs

the port of transhipment and placing it in the position of a forwarding agent H. C. or A.

and forwarding agents, on 19th January 1942. On or about 27th 1942, the bill of lading, invoices and policy, together with a draft, were presented to the appellant. Payment was refused the documents were rejected. The respondent claimed the price the goods (£4,654 2s. 11d.) and the amount paid by the respo on behalf of the appellant for war risk insurance (£187 5s. totalling £4,841 8s. 3d., or, alternatively, damages for bi contract.

In its particulars of defence, the appellant alleged that the lading was not a proper and sufficient contract of affreighty that it provided for the transhipment at Singapore ; that resj bility for delay at the port of shipment was declined ; that liabil for loss or detention in respect of certain risks was excluded ; liability was excluded for damage, detention or loss occurring durit transhipment and,capable of being covered by insurance ; that provided for transhipment at the risk of the owner; that the owner granting the bill of lading should at the port of transhij act as forwarding agent only, without further responsibility, in regard to through-rate of freight ; and that the goods were to transhipped at the risk of the owners, and after transhipment we be carried subject to the bill of lading on the on-carrying ste

It appeared that, originally, insurance had been effected und open or floating cover and an insurance certificate obtained. - first copy of the bill of lading, the certificate of insurance and ot documents had arrived in Sydney on 18th April 1942. On 2 April 1942, the insurance certificate was converted into a issued by the insurer expressing in full the terms of insurance. appellant alleged that the insurance was insufficient, and i particulars of defence gave the following grounds, viz., insurance was not effected by the respondent in conformity contract, that the policy tendered was not effected until 2 April 1942; that the claims thereunder were payable in that the goods were then lost ; that it was expressed to be un and agreed to be subject to the English law and usages as to and settlement of any and all claims; that loss prior to board an overseas vessel was excluded ; that loss at a port 0 shipment to another overseas vessel after expiry of fifteen excluded ; that it was warranted free of all claims arising delay. j At the trial of the action before Wolff J., judgment was for the respondent for the amount claimed. j

The appellant appealed from this decision to the High 0 The grounds stated in the notice of appeal were, inter al

e terms of the contract and was entitled to payment of the whole or any part of the price of the goods ; that neither the bill of lading wr the policy of insurance was as required by the contract ; that the nder of documents was not made within a reasonable time ; that Honour's finding that the bill of lading was the best that could be or was usual or customary or sufficient was against the eight of the evidence; that the policy of insurance was not a valid or effective policy; that his Honour wrongly admitted and relied on vidence as to previous dealings ; that his Honour, having found that e contract was not a c.i.f. contract, should have entered judgment the appellant ; that his Honour was wrong in holding that the in the goods passed to the appellant on shipment; that there no evidence that goods in accordance with the contract had been shipped ; and that his Honour should have found that the appellant s not liable to pay the price of the goods until they had arrived at emantle and had been landed and weighed.

H. P. Downing (with him E. F. Downing) for the appellant. (1) is no evidence that the goods were shipped. (2) There is no propriation of the goods. (3) There were no goods of contract scription ever at the risk of the appellant. (4) The respondent was at liberty to claim payment until it delivered goods of the quality to the buyer. (5) On the Judge's finding that no passed, respondent is not entitled to recover. In the ces in this instance the property does not pass until the bill and draft are accepted by the buyer. There is no risk until e goods are appropriated to the contract. The buyer would not w of their existence (Bowes v. Shand (1)). A policy has never been ented on any previous occasion to the appellant who has nothing do with the open policy. The shipment of the goods is not

ed. The seller must show he has shipped the goods (Bills of Act 1855 (Imp.), adopted here in 1856). The bill of lading is y evidence of shipment as against the master of the ship. There no evidence of shipment other than the bill of lading. There 'is no evidence of transhipment (James v. The Commonwealth (2) ). must be shipped from the original port in which they are

(1877) 2 App. Cas. 455, at pp. 467, (2) (1888) 62 C.L.R. 339, at pp. 376, 468, (3) (isziy 125 L.T. 388,

Honour was wrong in holding that the respondent had carried out H. ©. oF A.

Kennedy on C.I.F. Contracts, 2nd ed. (1928), pp. 5 and 6 Goods Act (W.A.). Here the goods were never appropriated to { contract (Manbre Saccharine Co. v. Corn Products Co. Ltd. (1 Anderson v. Morice (2); Zangtze Insurance Association Ltd. Bill of lading here means delivery order; something which enable the buyer to obtain delivery of the goods. i

The law as to proof of shipment is set out in J. Aron Incorporated v. Comptoir Wegimont (4); the Hague Rules ; Sc on Charter Parties and Bills of Lading, 13th ed. (1931), p. There was prima-facie evidence at least that the goods had shipped in accordance with the contract. The question of app priation does not apply where specific goods are involved. If t were not a c.if. contract, the risk of the goods passes to the buy shipment. The vendor sold at a composite price: Kenned C.1.F., Contracts, 1st ed. (1924), p. 79. Reasonable value of the ment is the proper amount to be insured. The buyer inst profits, hence the increase of ten per cent (Castle v. Playford (5) The respondent did everything required of it. It shipped goods the original port in November 1941 and insured goods for the as requested. It insured against war risks ; it delivered the lading in January 1942 as soon as it reached it by post. The lading is symbolical of the goods while they are in transit by sea. delivery order is also symbolical of the goods after they have landed and replaces the bill of lading (Barber v. Meyerstein (6) ). T respondent having fulfilled the contract could have claimed payme in January 1942; the property in the goods passed on shipme (Martineau v. Kitching (7) ). Provision for payment on net land weight at Fremantle does not mean that property has passed to # buyer: See ss. 17, 18, Sale of Goods Act (W.A.). In all the prev sixteen contracts, the respondent had never been paid for goods u the appellant had received the invoices, not on receiving th lading. On the assumption that the contract is not c.i.f., the but assumed the risk after shipment : Benjamin on Sale of Goods, 6th (1920), pp. 452, 453. As to incidence of risk, see Diamond All Corporation v. Bourgeois (8); In re Denbigh Cowan & Co. a Atcherley & Co. (9) ). The only way in which there can be a ence in shipped and landed net weights would be leakage

(1) (1919) 1 K.B. 198, (6) (1870) LR. 4 HLL. 317, at p. (2) (1875) LR. 10 C.P. 609. (7) R. 7 Q.B, 436.

(3) (1918) A.C. 585, at p. 589. (8) (1921) 3 K.B, 443.

OF AUSTRALIA. 309 insurance. Net landed weight did not detract from the cif. H.C or 4 e of the contract: Henry Dean & Sons (Sydney) Ltd. v. P. Rear ODay Pty. Lid. (1) Pharan Lap. E. F. Downing, in reply. The contract must be looked at as @ Wyrers The essential features of a c.i.f. contract are lacking. The Cae co. Lr.

can demand payment against delivery order. The price is d on landed weights and this also contemplates the arrival of the before the price can be claimed. The condition of landed hts put the responsibility for leakage on the seller. Insurance solely for the benefit of the seller. The seller intended to place the buyer all variations in freight and insurance rate. The ten cent variation in value for insurance purposes is to fix an upper mit so that the buyer would be protected in case of increase of rate premium. The war risk condition does not affect the position one or the other. If the contract is c.if., the seller is bound to certain documents, including the bill of lading concerning the s from the port of shipment to the port of destination to the : Hansson v. Hamel & Horley Ltd. (2). The bill of lading must vide substantial protection throughout the voyage ; this bill of 4 did not do so. No claim whatever can be pursued under the

ill of lading after transhipment. The bill of lading falls short of the tion required in a bill of lading under a c.i.f. contract. This of lading throws upon the persons the liability of having all claims under Netherlands East Indies Law (clause 17, bill of g, and also clause 14). There is nothing in the policy issued in pril 1942 to connect it with the appellant's open policy.' No specific liey was ever previously asked for by the appellant. The buyer

g asked to accept a policy in circumstances which would involve in litigation. The policy presented is not an effective policy for » purposes of a c.i.f. contract. The insurance company relieves if of esponsil lity after fifteen days from being unloaded for nshipment until it is shipped on the on-carrying ship. In these nces, the buyer would have no protection. No tender was of the documenta within a reasonable time of the goods being A specific policy required prompt notice of any loss. If the er has any action here, it is for damages: S. 48 of the Sale of is Act (W.A.). Any appropriation made by the seller was con- al on acceptance of goods by the buyer : Stein Forbes & Co. v. ty Tailoring Co. (3). It is not ac.i.f. contract because acceptance.

L (1927) 39 CLR. 380, at pp. 4, (2) (1922) 2 A.C, 96, at pp, 4, 45, : (8) (1916) 86 LJ. KB 448,

can be demanded against a delivery order : Johnson v. Taylor 1

Co. Ltd. (1) ; Sea-Carriage of Goods Act (1924), the Schedule, A The bill of lading is the only evidence of acknowledgment

any risk could have been assumed by the buyer in respect of th goods. They are not identified and there is no active appropriat by the seller. If the contract is not a c.i.f. contract, the seller has: fulfilled his part of the contract.

Louch (by leave). Scrutton, 13th ed. (1931), p. 198; Kennedy, 0.) Contracts Ist ed. (1924), pp. 41-42. It is sufficient if the bill of is one which is usual in trade or on the route concerned. According practice and usage, the seller adopted the only practical y transit to Fremantle. What happened on previous consign the best evidence of the practice and usage: Scrutton, p. 82 (tl bills of lading). Limitation of liability on transhipment is a provision. The contract is a mercantile one and should be re; from that standpoint. Insurance should be made in acco with the custom of trade: Kennedy, p. 56. The usual clause is negativing of liability after the goods are discharged for transhij after fifteen days. An inseparable incident of a ¢.i.f. contract the buyer is to accept a policy not giving complete cover :

reasonable in a mercantile sense : Kennedy, p. 86. It was imp at that time to get a better policy than that obtained. It possible to hold up a transaction under our system of co

of shipment. The bill of lading is prima-facie evidence of shij under the Hague Rules. Unliquidated damages would be the sa as the price of the goods,

Ricu, Dixon and McTiernan JJ. This appeal concerns liability to the seller of a buyer of goods, to be shipped late in I! from Zanzibar to Fremantle, which, it is conjectured, were Singapore while awaiting transhipment to Fremantle.

The buyer, a manufacturing company carrying on bu Perth, had been accustomed to purchase Zanzibar clove oil fro seller, a company carrying on a merchant's business in Syd elsewhere. The transaction now in question depends upon a ¥ contract, dated 22nd September 1941. The seller claims that

amounts to a c.if. contract, or, if not that, at least one which places pon the buyer the risk of loss or damage to the goods during transit. Having tendered to the buyer, who rejected them, a bill of lading, ance policy and invoice in respect of the lost goods, the seller d in the Supreme Court of Western Australia for the price, for vhich it recovered judgment before Wolff J. From that judgment, present appeal comes.

The contract is expressed in a letter from the seller confirming the uyer's order. It describes the order as one for four tons of Zanzibar ve oil packed in drums each approximately five hundredweights. Then under " price " it proceeds as follows : - " eight shillings and a nny (stg.) per Ib. Nett landed weight Cost Insurance Freight antle, Bank exchange Australia/London to buyers' account. price is based on the current rate of freight and marine insurance, y variations to buyers' account."

Under " shipment " there is the statement : - " Per steamer during October/November/December 1941 from original port." Then fol- references to " insurance " and " war risk insurance." '" W.P.A. not exceeding the above value plus 10%. If it can be arranged y sellers war risk insurance is to be covered and charged to buyers'

Next comes : - " Terms: nett cash against delivery order or bill/ The contract then concludes : - " Sellers not responsible for any loss or delay caused by strikes - direct or indirect - fire force "majeure and other circumstances beyond their control."

A contract for the sale of goods upon c.if. terms places upon seller an obligation to ship goods of _the contract ae

it for the amount, and, as soon as reasonably practicable, to er these documents to the buyer in exchange for payment of the nt shown on the invoice, or acceptance of a bill of exchange erefor, as the contract may provide. It is "a contract for the sale of goods to be performed by the delivery of documents, and what those documents are must depend on the terms of the contract itself": Per Bankes L.J., Arnhold urberg & Co. v. Blythe, Green, Jourdain & Co. (1). "It is not a ontract that goods shall arrive, but a contract to ship goods comply- with the contract of sale, to obtain, unless the contract otherwise the ordinary contract of carriage to the place of destination,

and the ordinary contract of insurance of the goods on that voy: and to tender these documents against payment of the contract The buyer then has the right to claim the fulfilment of the cont carriage, or, if the goods are lost or damaged, such indemnity loss as he can claim under the contract of insurance " : Per S in Arnhold Karberg & Co. v. Blythe, Green, Jourdain & Co. (1). "T condition of the goods at the time of the tender of the ship documents is not material, nor is the value of the documents the time of the tender material. In all such matters the on the buyer. He may be obliged to pay for goods although may be at the bottom of the sea, or although through some unf circumstance they may never arrive, or although they may haye be lost owing to some cause not covered by the agreed form of policy Per Bankes L.J. (2). "In my view, therefore, the relevant questi will generally be not 'what at the time of declaration or documents is the condition of the goods?' . . . but 'wi the time of tender of documents, was the condition of those do as to compliance with the contract . . .?'": Per Serutton J. (

The leading terms of the contract under our considerati characteristic of a sale on c.if. terms and raise a presumptio it falls within that category. But it is claimed that a close e tion of its terms show that some of them conflict with the bi conception and change the character of the contract into which the arrival of the goods is essential and the risk of in transit is not accepted by the buyer.

In the first place, the words following the statement of

is only ascertainable after the goods are landed and that, events, risks of loss of weight, as by leakage, fall on the seller.

protection, not the buyer's, and since the clause fixes a m the object of all the references to insurance must simply be to p

contended that, if payment may be against delivery order, the tht of the c.if. transaction is destroyed. Lastly, the force clause is relied upon as another indication that the seller risk and needs to be relieved in exceptional circumstances.

It is convenient to deal with these points in reverse order. | argument upon the force majeure clause is fallacious because 1

(1) (1915) 2 K.B 379, at p. 388. (3) (1915) 2K.B,, at p. 388. (2) (1916) 1 K-B,, at p. 510. @

referable to the obligations of the seller whatever they may be and H. ©. oF A. throws no light on their extent or duration. It is entirely consistent We with its terms to treat it as relieving him in circumstances beyond his py airan control from the obligation of shipping the goods and forwarding Ia. and tendering the documents. It is comparable with the clause, @ - Wyrers _ clause differently worded however, in Diamond Alkali Export Travrxe Corporation v. Bourgeois (1). Sop The reference to the delivery order gives the seller a choice. If ae he finds it more convenient, because for example the bill of lading McTiernan 5 includes other goods, he can await the ship's arrival, obtain a delivery order and tender that instead of a bill of lading. It does not alter the conditions which the seller must fulfil if he chooses to tender a bill of lading and the obligations of the buyer, if that course is taken. The use of the words " not exceeding" does appear illogical for, if insurance is to protect the buyer, the naming not of a maximum but a definite amount would be expected. The reference, however, to war risk that immediately follows, is plainly on the footing that insurance is to protect the buyer and the clause making variations in insurance rates an affair of the buyer looks in the same direction. The addition of ten per cent, or some other percentage, to cover the buyer's profit or the increased value to him is a not uncommon practice, and, on the whole, it looks as if the clause is to express a limit of the amount of the responsibility of the seller to insure but, subject to that limit, to leave him under the same obligation of effecting a reasonable insurance as well as to amount as to other terms. There is more cogency in the argument founded on the words " nett landed weight." If the landing of the goods must be awaited, how can the conditions imported by c.i.f. terms be complied with and how can the responsibility for risks ever arise ? The provision is, of course, based on the assumption that the purpose of the contract will be fulfilled and the goods will be available for weighing. The real question is whether it imports an indispen- sable condition into the contract. It seems clear that one way open to the seller of performing his obligations under the contract is to hand over a bill of lading against payment. The goods could not be weighed before delivery to the consignee which, of course, means that the bill of lading is spent, even if not surrendered. It is evident that the weighing may be after payment of the price has been made against the bill of lading. In other words, just as under a c.if. contract examination of the goods for condition and quality must take place after the delivery of the bill of lading, so under this

H.C. or A. contract may the final computation of the quantity and adjus esi of the price. It isa fair inference that arrival and weighing y pramar intended to be a condition of or precedent to liability. Th Lm. Denbigh Cowan & Co. and R. Atcherley & Co. (1) the Waters Contract there in question was held to be on c.if. terms, Trapiwe standing that it provided for " net landing weights " and spe Co. Ix." payment : cash (before delivery if required) against document ih; delivery order." The Court of Appeal decided, accordingly, MeTicrnan J. buyers were entitled to receive a policy of insurance, even altho the goods arrived and the sellers chose to tender, not a bill of but a delivery order. The purpose, according to counsel in that of giving the seller the choice of presenting a delivery order a

a bill of lading was to free him from difficulties when goods coi

goods covered by one insurance. The Court of Appeal, howevel the terms of the particular form of contract, rejected the vier if the seller chose to use a delivery order, that dispensed tendering a policy of insurance. In Karinjee Jivanjee & Co William F. Malcolm & Co. (2), in dealing with a contract containi another divergence from what otherwise were c.if. terms, said (3): "' There are many contracts of a mixed nature whith tain elements proper to c.i.f. contracts and proper to cont 'actual delivery of goods; but in its general scope this c¢ partakes far more of the elements and character which c.if, contracts than to any other form of contract." This obse tion applies to the present case, in which the proper conclusi the whole document appears to be that, in spite of the from type, the contract is in essence a sale upon c.i.f. terms, a it casts an obligation on the buyer to pay the price on a tent time of proper shipping documents independently of the the goods. 7

It is, therefore, necessary to decide whether the seller tender proper shipping documents.

It was objected on behalf of the buyer that neither lading nor the insurance gave him adequate protection ; that had not been obtained until after the loss of the goods ; that: able expedition had not been shown in forwarding and tend documents ; and that, at the trial, proof of actual shipm proper port, of the contract goods had not been given.

The bill of lading acknowledges that, on 27th November eighteen drums, contents said to be clove stem oil, weight said

(1) (1921) 125 LT, 388. (3) (1926) 25 LL L. Rep., at p (2) (1926) 25 Ll. L. Rep. 28.

ll tons 24 ewt., were shipped by the Clove Growers Association yy a Dutch ship lying in Zanzibar for shipment to Fremantle, tran- shipment at Singapore, delivery to order. The Clove Growers tion, it is said, controlled the distribution of the East African oducts.

n the language of the Sale of Goods Act, 1895 (W.A.), the seller make such contract with the carrier as may Te aan ing regard to the nature of the goods and the other circumstances 'the case. " The obligation is satisfied if the contract of carriage na form current in the trade or on the contemplated route. The is not called upon to procure a contract on more favourable s than those usually contained in the ordinary bill of lading in in the trade or on the route concerned. In any given case the to be applied is whether it is in accordance with the usage and tice in the trade to carry goods of the contractual description from and to the places in the contract under a contract of such as that in question": Kennedy on C.I.F. Contracts, Ind ed. (1928), p. 41.

The buyer, in the particulars under its defence, has set out a mber of objections to the conditions of the bill of lading. They all governed by the consideration that, on the particular route, shipper could not be expected to obtain a more favourable ill of lading and it is enough to mention the chief objection relied in the argument of the appeal. It relates to the transhipment

sions, and, no doubt, it is of practical importance in the applica- of the facts of the case. For it assumed, and with every proba- , that the loss of the goods was occasioned by the state of at Singapore, where they are thought to have arrived late in mber 1941. The effect of the provisions in question, briefly, is telieve the original shipowner of all liability for loss or damage while the goods are in course of transhipment and to give m no greater responsibility than that of a forwarding agent, jecting the goods to the terms of the bill of lading of the on- ying steamer, to whose agents at the port of destination claims t be made. The practice apparently is for the consignee to e delivery of the goods on production of the through bill of g and to obtain the on-carrying bill of lading, or a copy of it, y if needed in connection with a claim for loss or damage. In y. Hamel & Harley Ltd. (1), a case of transhipment at g after a voyage from Braatvag, the bill of lading tendered that of the on-carrying steamer granted after shipment of the s, but it was headed " Through Bill of Lading " and acknow-

ledged shipment in the first ship at Braatvag for Hamburg transhipment there. The margin mentioned the first bill of lading and its date, thirteen days before the date of the second or ocean | of lading. Lord Sumner said : - " A c.f. and i. seller, as has been pointed out, has to cover the buyer by procuring and tenderi documents which will be available for his protection from shipi to destination, and I think that this ocean bill of lading afforded

elapsed between the dates of the two bills of lading and presun between the departure from Braatvag and the arrival at Hambu (1). The reasons for the conclusion that the ocean bill of lading insufficient protection during those thirteen days were summed in a sentence : - ''It is the contract of the subsequent carrier without any complementary promises to bind the prior carri the through transit " (2). Although the facts are quite different, the buyer contends that Lord Sumner's general statement is applicable and that the goo were in substance unprotected after discharge at Singapore. contention cannot prevail. The buyer is entitled only to that measure of protection which the seller can reasonably pro according to the usage and practice obtaining in the trade and w reference to the available routes: See N. V. Meyer v. Aune (3) a Burstall & Co. v. Grimsdale & Sons (4). 4 The evidence shows that there is no direct shipping available fro mn Zanzibar to Fremantle, that the only practicable course was th adopted and that it involved the acceptance of the bill of question as that of the only shipping line carrying cargo from Zanzibar to Singapore on through bills of lading to Fremantle. 1 also appears that, in a number of prior transactions, the sellers had shipped by the same route and, for what it is worth, under the bill of lading. 4 It appears that the triplicate copy of the bill of lading re Sydney on 5th January and Perth on 19th January 1942, and first copy reached Sydney on 18th April 1942. The triplicate ee was not presented to the buyer, but it was handed at once to customs agent with instructions to clear the goods on arrival.

policy and a declaration thereunder. On 18th April, too, then arrived the certificate of insurance, the weight specification, declaration and a statement of debits, including the amount ' exchange. The seller at once converted the declaration i

(1) (1922) 2 A.C, at pp. 44, 45. (8) (1930) 3 AN E.R. 168, ot ppeMR (2) (1922) 2 A.C, at p. 46. (4) (1966) 11 Com, Cas. 280.

y, which he could tender, by obtaining from the insurers a y expressing the conditions of the contract effected by the ation. The fate of the goods was at the time unknown, as An invoice was made up and the documents, the ll of lading, policy and invoice were presented to the buyer in : "Perth on 27th April 1942.

Objections, which again are stated in the particulars, are made to the adequacy of the cover afforded by the policy. One of these points salls especially for notice because it relates to transhipment. It is

on-carrying ship and does not re-attach till they are so loaded.

'The limitation to fifteen days customary in transhipment clauses caused much difficulty during the period of the Japanese advance d, as from 13th August 1942, cover unlimited as to time was made able to insurers under an arrangement pursuant to the War Re-insurance Scheme of the United Kingdom. This point is s by the fact that no marine insurance could be obtained at the ne of the transaction covering the goods for more than fifteen days ling transhipment or reloading. 'The other objections made by the particulars against the cover d by the insurance fail for the reason that, according to the ce, it was a usual policy.

_ The objection that the policy was not issued until 20th April 1942 is met by the fact that the goods had been covered from the commencement of the voyage and the policy amounted only to a formal expression of the contract of insurance as affecting the This consideration answers also the point made that the were known to be lost, if, indeed, it could be said that they are et "known " to be lost.

_ The question whether less than reasonable expedition was shown in the bill of lading is one upon which there seems to have no express finding. But the seller did all that could reasonably e expected of him. The question really turns on the course taken the seller with the triplicate copy received in January 1942. For delay occurred in dealing with the documents received on 18th once they arrived and there is no ground for supposing that had not been transmitted to Sydney in the best way available. ys in the course of post with Australia at that time were con- . Ought the triplicate to have been tendered at once ? ver lies in the fact that neither the insurance document nor terials for making up the invoice had arrived and to tender the copy alone would not have fulfilled the seller's obligations 2l

nor have advanced their fulfilment. It is the practice to use the f or original copy and, as between the parties, it seems that the s took the customary and practical course.

Two points remain. The first is that the seller failed to that the goods were actually shipped, a fact alleged in the sta of claim and put in issue by a denial of each and every alle in the paragraph alleging it. Wolff J. considered that a paragraph of the defence impliedly admitted the fact, as ind

expected to do. But it is difficult to treat the defence in this The seller relied on rule 4 of Article III. of the Hague Rules, but th are rules governing the contract of affreightment and it is more

doubtful whether the particular rule can operate adversus eat

for the price but only for unliquidated damages. The pro) the goods had not passed. The contract did not provide for ment for the goods on a day certain. The appellant is, the tight in saying that the remedy is in unliquidated damages. & Atkin J., Stain Forbes & Co. v. County Tailoring Co. (1) and Maclean & Co. v. Leslie & Anderson (2). If the holder of the policy of insurance can recover upon i valued on that footing in assessing damages, the matter may b than formal. But the point is not clearly and specifically tal the notice of appeal and there is much reason to doubt its pra substance. In all the circumstances, however, it is better to remit the e: to Wolff J. to deal with the two last mentioned points. It is di to see any merit in the first, but if the defendant persists in it ev on commission may be necessary unless under the rules Supreme Court of Western Australia some such course can be as was adopted in Murine Eye Remedy Co. v. Eldred (3). Otherwise the appeal should be dismissed.

Remit the action for further hearing upon the issue shipment of the goods in pursuance of the contract a upon the issue of damages and, for this purpose, set the judgment appealed against. Otherwise appeal missed. Costs of the appeal and of the trial costs

Solicitors for the appellant, Nicholson & Nicholson, Perth. - Solicitors for the respondent, Stone, James & Co., Perth.

(1) (1916) 86 L.J. K.B, 448, (3) (1926) V.L.R. 425. (2) (1921) W.N. (Eng.) 235.

At a glance

Court

Decision date

Before

Source

Judgment (97 paragraphs)