The defendant said the reason why everyone was agreed that Nigerian law did not apply was because it was commonsense that Nigerian law had no claim. "That may be a form dressed up of interest analysis the Americans toyed with from time to time. What interest does the law of the territory have to have a say in respect of an injury occurring wholly on board the ship."
27 The defendant next analysed MacKinnon v The Iberia Shipping Co Ltd 1955 SC 20. The pursuer was an engineer who was injured, allegedly by the direct and vicarious negligence of the defenders, who owned the vessel on which he worked, while it lay at anchor in an open roadstead in the territorial waters of the Dominican Republic. It was not clear why it was there. The vessel was registered in Scotland. Both Dominican Republic law and Scots law allowed a claim for patrimonial loss, but, according to the defenders, only Scots law allowed a claim for solatium (ie recovery for wounded feelings).
28 The legal background in Scotland was that M'Elroy v M'Allister 1949 SC 110 had decided that an act done in a foreign country was actionable in Scotland only if it was, if done in Scotland, a tort, and was also actionable according to the law of the place in which it was done. This corresponded to the then English rule in Phillips v Eyre (1870) LR 6 QB 1. The parties assumed M'Elroy v M'Allister to be correct, but were in dispute as to its application. They also assumed that a claim for solatium was a distinct right of action, not merely something affecting the measure of damages.
29 The Lord Ordinary, Lord Migdale, held that the pursuer could only succeed if he averred that the claim for solatium was actionable both by Scots law and the law of the Dominican Republic. That is, the rule in M'Elroy v M'Allister applied not only to delicts committed on the territory of a foreign state, but to those committed on ships in foreign territorial waters.
30 The pursuer appealed on the ground that though M'Elroy v M'Allister was correct, it did not apply: the place of the delict was not the Dominican Republic, so that the lex loci delicti was not that of the Dominican Republic but that of Scotland, and no conflict of laws attracting M'Elroy v M'Allister existed.
31 The First Division of the Court of Session agreed with the Lord Ordinary. The defendant relied on the following remarks of Lord Carmont at 28-29:
"[The pursuer] contended that, as the vessel was only at anchor within the Dominican waters, the locus of the quasi -delict was 'the ship' and that the law of its flag - Scots law - applied. Accordingly, as the law of the flag and the law of this forum coincided, no heed need be paid to Dominican law, and the pursuer was therefore justified in making no mention of it in his pleadings. The argument was presented in two aspects: (1) that a ship within territorial waters of a foreign country did not lose the benefit of the law of its flag merely by being anchored off the coast of the littoral country; and (2) that, in any event, so long as the events complained of in an action were entirely internal to the vessel, as in the present case, there was nothing to support the view that the locus of the occurrence was the littoral territory, whatever its extent or extension.
There is much to be said for both branches of the pursuer's argument as to locus from a practical and common-sense point of view. If the occurrence giving rise to the present case had happened when the vessel was four miles off the San Domingo coast, the law of the flag would have applied, and it would not have been of any moment whether the vessel was at anchor or not. It may seem strange that a vessel proceeding along the coast of a continent, but allowing her course to bring her within three miles of the coast, should find the same occurrences as are averred in this case treated as having taken place within the territory of the littoral State which the vessel was passing at the time. That was the contention of the defenders, and they put no emphasis on the fact of anchoring. It was enough, they said, that the vessel could be shown to be - albeit by calculations made ex post facto - in the waters accorded by international law to the littoral State as part of the State's territory and subject to its law. The difficulty of telling in certain cases where the vessel is, at the time an event takes place, was not blinked by the defenders; and it is, indeed, obvious that there is a certain aspect of absurdity present when the instance is taken of a ship coasting along, close to several countries in succession, while an internal repair operation is going on. The owners would find themselves liable to investigate that internal episode, resulting in an employee's injury, from the standpoint of the law of several countries that were being passed in succession. An episode in an airplane suggests even greater absurdities. I am unable, however, to find any real support for the pursuer's contention that mere passing along within territorial waters does not displace the law of the flag, or that something more intimate, if I may so phrase it, than anchoring is necessary to vouch presence within a State. But even a ship moored to a quay in a foreign harbour has little real connection with the law of the harbour's State, until something brings the ship or its master, crew or passengers into some relation to that State.
This brings me to the pursuer's supporting argument, that, even conceding the relevance of the law of the littoral State where there is some act done by those in charge of the vessel which affects the Government of the littoral State or its subjects, or indeed any person external to the vessel, yet, when everything takes place within the ship itself, there is no ground for invoking the law of the littoral State so as to displace the law of the flag. I find this argument attractive."
32 However, Lord Carmont then said (at 29-30) that to give effect to the pursuer's argument:
"would be breaking new ground and running counter to everything to be found in the treatises on international law, with one exception which I shall discuss in a moment, and, as regards the decisions which bear on the principle of international law with which we are concerned, we were referred to only a single case (and that the decision of a Judge of first instance) which seems to impinge on what is otherwise treated as settled.
It is plain from what was said by Lord Atkin, when delivering the opinion of the Privy Council in the case of Chung Chi Cheung [[1939] AC 160], that in modern times the idea of even a Government ship being a 'floating island,' belonging to and retaining the law of the country of its flag, has been abandoned. Much less, then, can it be urged with success that a private trading vessel can claim extraterritoriality. As in Chung Chi Cheung's case the delict took place while the vessel was being navigated and not even at anchor, it is plain that it is the mere presence of a ship within territorial waters that is conclusive. This is in harmony with what is stated by Dicey and Cheshire in the learned treatises associated with their names. But the pronouncements of these learned authors in their texts are supported by reference to authority. I refer to the cases of The Halley [LR 2 PC 193]; Carr v Fracis Times & Co [[1902] AC 176]; The Arum [[1921] P 12]; Yorke v British and Continental Steamship Co [78 Ll LR 181]. These cases point conclusively to the locus delicti being the country having the territorial waters within which the ship was at the relevant time, and that it matters not a whit whether the vessel was navigating or at anchor, in a roadstead or tied up to a quay, and also, what is equally clear, whether the events founded on as the basis of the delict or quasi -delict are wholly internal to the vessel, or partly external to it as in the case of a collision between vessels in territorial waters. Against this view, Mr Kissen for the pursuer relied on the case of The Reresby v The Cobetas [1923 SLT 719] in which Lord Blackburn, sitting in the Outer House, found some reason for not following The Halley , which was cited to him, which is not easy to justify, or even to appreciate. In my opinion, The Reresby was wrongly decided.
The Lord Ordinary has quoted the passage from the treatise of Dr Colombos on which reliance was placed, but it is in conflict with the views of Dicey and Cheshire as set forth by the Lord Ordinary. I agree with the Lord Ordinary that Dr Colombos's view falls to be rejected as not being the law that we must apply in this forum ."
33 The defendant stressed that Lord Carmont appeared to be attracted in principle by the greater certainty for shipowners afforded by selecting the law of the flag as the lex loci delicti, and that the movement of ships and the particular territorial waters into which they might move might be unpredictable: this was important in relation to the insurance arrangements which shipowners might make. The defendant referred to John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at [79] and [84].
34 Lord Russell agreed with Lord Carmont.
35 Lord Sorn reasoned in similar fashion to Lord Carmont, and the defendant treated the reasoning in similar fashion: it highlighted the parts critical of the plaintiff's position, and sought to discount the other parts. Lord Sorn said at 35-37:
"Mr Kissen, for the pursuer, did not dispute the general rule [in M'Elroy v M'Allister ], but argued that it did not apply, firstly, because the Act had taken place only in territorial waters and, secondly, because it had taken place wholly on board ship.
As regards the first point, I think that, for the purposes of the rule, no distinction is to be drawn between territory and territorial waters. In The Halley [LR 2 PC 193] a collision took place in Belgian waters when the defendants' ship was in the hands of a compulsory pilot. Under Belgian law the defendants were liable for the negligence of the pilot, whereas under English law (at that date) they were not. In the judgment delivered by the Privy Council there is no trace of the view that Belgian law did not apply because the delict took place in Belgian waters as opposed to Belgian territory, and the ground of judgment was that the defendants must succeed because the plaintiff would have had no right of action if the delict had occurred in England. In Carr v Fracis Times & Co [[1902] AC 176] the alleged delict was committed in foreign territorial waters and no distinction was made between the law applicable to that situation and the law applicable to a delict committed within foreign land territory. On the contrary, in speaking of the act complained of, Lord Macnaghten says (at p 182): 'It was committed in the territorial waters of Muscat, which are, in my opinion, for this purpose, as much a part of the Sultan's dominions as the land over which he exercises absolute and unquestioned sway.' In The Arum [[1921] P 12] a collision took place owing to the fault of a compulsory pilot in the territorial waters of Gibraltar, where compulsory pilotage was a good defence. In England, at that date, it was not a good defence. Hill J had no difficulty in holding that the plaintiff failed because his case was not actionable under the lex loci delicti . It is true that in the Scottish case of The Reresby v The Cobetas [1923 SLT 719] a different result was arrived at. In that case a collision occurred between a British and a Spanish vessel in French territorial waters. Lord Blackburn held that it did not matter whether the pursuer had an actionable case by the law of France and that the rights of parties were governed solely by the lex fori . He drew a distinction between acts occurring upon the land territory of a foreign State and acts affecting ships in passage through territorial waters, but the ground of distinction is not clear and I do not think that the decision can stand with the other cases to which I have referred.
Mr Kissen's next point was that, although the rule might apply to external acts occurring in territorial waters, a different rule should be applied to acts which took place entirely on board ship. External acts, he said, no doubt had a local habitation but internal acts need not be treated as having a locus other than the ship itself. For such an act the proper law to look to was the law of the ship itself, that is to say, the law of the flag. The test in such a case should be actionability by the law of the flag and actionability by the lex fori . As I understood the argument, it was not suggested that extraterritoriality in the matter of jurisdiction should be conferred on the ship with regard to such acts, but only that the law of the waters should be displaced by the law of the flag in the matter of choice of law. The injured party would be free to seek his remedy in any Court under the municipal law of which he could found jurisdiction, including the Court of the littoral State, but, it was argued, in so far as the system of law observed by that Court referred the ascertainment of a pursuer's rights to the lex loci delicti , the law of the flag in these cases should be substituted for the lex loci delicti . The law of the flag, and the subjection of those on board to it, already had a place in our practice of international law, and, it was said, there could be nothing incongruous in applying that law here. On the other hand, to apply the law of the geographical locus delicti produced results which had an element of absurdity. Did it contribute anything to the comity of nations that a Glasgow man, injured in the engine room of a Glasgow ship whilst on a voyage, should have his rights determined by the law of San Domingo in an action raised in this country when he got home? In the present case the ship was anchored in territorial waters, but, if the lex loci is to be applied here, it is to be assumed that it would also have to be applied even where the ship was only in course of passage through such waters. To the objection that the introduction of a distinction between external and internal acts would involve an additional, and perhaps troublesome, question in determining the choice of law, Mr Kissen was able to point out that the distinction already had received some recognition in connexion with quasi -delict committed on the high seas - Dicey, (6th ed) p 805; Cheshire (4th ed) p 272. The force of Mr Kissen's argument has impressed me, and re integra there would be much to be said for adopting the rule he suggests. I have, however, not found it possible to treat the matter as being an open question. The rule that the lex loci delicti applies to territorial waters appears to me to have stood for a long time without any distinction being drawn between one kind of act and another. Our leading textbooks state the rule in terms applicable to both external and internal acts. We were not referred to any case in which the distinction had been considered or even suggested. The inference to be drawn is, I think, that it has been tacitly accepted that the rule applies to all acts, including those which take place wholly on board ship. Certain observations of du Parcq LJ, as he then was, in Yorke v British and Continental Steamship Co [78 Ll LR 181] seem to show that he at any rate went upon that assumption. In that case the plaintiff, one of the ship's officers, had met with an accident on board while the ship was at Gibraltar. He brought an action in England for damages against the owners, alleging inter alia , that the accident was due to their common law negligence. There was no allegation in the pleadings that the act complained of was a wrongful act by the law of Gibraltar, and it would seem that this question had never been raised in the course of the proceedings. In agreeing with the view that the plaintiff had succeeded in establishing a case of negligence du Parcq LJ said (at p 184): 'But I just want to add this. I think that in a case of this kind it is desirable, and indeed it may be essential, strictly speaking, that the statement of claim should allege that the act complained of - negligence in this case - is a wrongful act by the law of the country where the tort is alleged to have been committed. It is perhaps rather pedantic to say anything more about it in this case, but, as anybody reading a report of this case will see it is matter arising from what is foreign territory for the purposes of this case, it is perhaps as well to make it clear that on that point the matter was dealt with.' Since the point was not presented for decision, the case need not be regarded as a precedent to the effect that no distinction is to be drawn between internal acts and the other acts. None the less I think the passage quoted, to which must be attached the weight associated with the opinion of an eminent Judge, confirms the view that it has been tacitly accepted that no such distinction is to be drawn."
36 The defendant submitted that the cases on which the First Division of the Court of Session relied did not support its conclusion either because they were distinguishable or because they assumed the answer to the present question. Chung Chi Cheung v R [1939] AC 160 concerned criminal jurisdiction, not choice of law in civil cases. The "Halley" (1868) LR 2 PC 193 and The Arum [1921] P 12 were cases of collisions; they did not involve acts internal to the ship. Yorke v British & Continental Steamship Co Ltd (1945) 78 Ll L Rep 181 was a case of an act internal to the ship, but there was no difference between the law of the flag and the law of the littoral State, and the statement of du Parcq LJ at 184 which supported the First Division of the Court of Session was neither necessary for the decision nor the result of argument. The defendant advanced various reasons for distinguishing Carr v Fracis Times & Co [1902] AC 176 of which the simplest was that the tort was not an internal one. It might be added that the answer to the question whether the relevant law was the law of the flag or the law of the littoral State was assumed, not argued. These points are all sound.
37 The defendant then turned to two of the United States authorities.
38 In Lauritzen v Larsen 345 US 571 (1953) the facts were that a Danish seaman, while temporarily in New York, joined the crew of a ship of Danish flag and registry, owned by a Danish citizen, and signed ship's articles, written in Danish, providing that the rights of crew members would be governed by Danish law and by the employer's contract with a Danish union, of which the seaman was a member. He was negligently injured aboard the ship in the course of employment, while in Havana harbour. He sued on a United States statute called the Jones Act, the operative provision of which was:
"Any seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law with the right of trial by jury, and in such action all statutes of the United States modifying or extending the common-law right or remedy in cases of personal injury to railway employees shall apply … ."
39 The lower courts held that the Act applied - prima facie an astonishing conclusion, since the only link with the United States was that the plaintiff joined the ship in New York, returned to the United States after his injury, and sued in the United States. The Supreme Court, speaking through Jackson J, reversed the lower courts (Black J dissenting without reasons). At 575-576 Jackson J said:
"Denmark has enacted a comprehensive code to govern the relations of her shipowners to her seagoing labor which by its terms and intentions controls this claim. Though it is not for us to decide, it is plausibly contended that all obligations of the owner growing out of Danish law have been performed or tendered to this seaman. The shipowner, supported here by the Danish Government, asserts that the Danish law supplies the full measure of his obligation and that maritime usage and international law as accepted by the United States exclude the application of our incompatible statute.
That allowance of an additional remedy under our Jones Act would sharply conflict with the policy and letter of Danish law is plain from a general comparison of the two systems of dealing with shipboard accidents. Both assure the ill or injured seafaring worker the conventional maintenance and cure at the shipowner's cost, regardless of fault or negligence on the part of anyone. But, while we limit this to the period within which maximum possible cure can be effected … the Danish law limits it to a fixed period of twelve weeks, and the monetary measurement is different. The two systems are in sharpest conflict as to treatment of claims for disability, partial or complete, which are permanent, or which outlast the liability for maintenance and cure, to which class this claim belongs. Such injuries Danish law relieves under a state-operated plan similar to our workmen's compensation systems. Claims for such disability are not made against the owner but against the state's Directorate of Insurance Against the Consequences of Accidents. They may be presented directly or through any Danish Consulate. They are allowed by administrative action, not by litigation, and depend not upon fault or negligence but only on the fact of injury and the extent of disability. Our own law, apart from indemnity for injury caused by the ship's unseaworthiness, makes no such compensation for such disability in the absence of fault or negligence. But, when such fault or negligence is established by litigation, it allows recovery for elements such as pain and suffering not compensated under Danish law and lets the damages be fixed by jury. In this case, since negligence was found, United States law permits a larger recovery than Danish law. If the same injury were sustained but negligence was absent or not provable, the Danish law would appear to provide compensation where ours would not."
40 Jackson J then pointed out the superficial breadth of the statutory language, or what he called, in a typical phrase, "the literal catholicity of its terminology" (at 576-577):
"If read literally, Congress has conferred an American right of action which requires nothing more than that plaintiff be 'any seaman who shall suffer personal injury in the course of his employment.' It makes no explicit requirement that either the seaman, the employment or the injury have the slightest connection with the United States. Unless some relationship of one or more of these to our national interest is implied, Congress has extended our law and opened our courts to all alien seafaring men injured anywhere in the world in service of watercraft of every foreign nation - a hand on a Chinese junk, never outside Chinese waters, would not be beyond its literal wording.
But Congress in 1920 wrote these all-comprehending words, not on a clean slate, but as a postscript to a long series of enactments governing shipping. All were enacted with regard to a seasoned body of maritime law developed by the experience of American courts long accustomed to dealing with admiralty problems in reconciling our own with foreign interests and in accommodating the reach of our own laws to those of other maritime nations."
41 Jackson J then said (at 577) that the shipping laws of the United States "have been construed to apply only to areas and transactions in which American law would be considered operative under prevalent doctrines of international law." He relied on American authority to the effect that statutes ought not to be construed to violate the law of nations if any other possible construction existed, and English authority to the effect that statutes should not, if any other construction was possible, be construed to apply to acts by foreigners outside the dominions of the enacting State.
42 Jackson J then said (at 581-582):
"Respondent places great stress upon the assertion that petitioner's commerce and contacts with the ports of the United States are frequent and regular, as the basis for applying our statutes to incidents aboard his ships. But the virtue and utility of sea-borne commerce lies in its frequent and important contacts with more than one country. If, to serve some immediate interest, the courts of each were to exploit every such contact to the limit of its power, it is not difficult to see that a multiplicity of conflicting and overlapping burdens would blight international carriage by sea. Hence, courts of this and other commercial nations have generally deferred to a non-national or international maritime law of impressive maturity and universality. It has the force of law, not from extraterritorial reach of national laws, nor from abdication of its sovereign powers by any nation, but from acceptance by common consent of civilized communities of rules designed to foster amicable and workable commercial relations.
International or maritime law in such matters as this does not seek uniformity and does not purport to restrict any nation from making or altering its laws to govern its own shipping and territory. However, it aims at stability and order through usages which considerations of comity, reciprocity and long-range interest have developed to define the domain which each nation will claim as its own. Maritime law, like our municipal law, has attempted to avoid or resolve conflicts between competing laws by ascertaining and valuing points of contact between the transaction and the states or governments whose competing laws are involved. The criteria, in general, appear to be arrived at from weighing of the significance of one or more connecting factors between the shipping transaction regulated and the national interest served by the assertion of authority. It would not be candid to claim that our courts have arrived at satisfactory standards or apply those that they profess with perfect consistency. But in dealing with international commerce we cannot be unmindful of the necessity for mutual forbearance if retaliations are to be avoided; nor should we forget that any contact which we hold sufficient to warrant application of our law to a foreign transaction will logically be as strong a warrant for a foreign country to apply its law to an American transaction."
43 At 583 he said:
"We therefore review the several factors which, alone or in combination, are generally conceded to influence choice of law to govern a tort claim, particularly a maritime tort claim, and the weight and significance accorded them."
44 The first factor he referred to was the place of the tort. He said, however, at 583-584:
"The test of location of the wrongful act or omission, however, sufficient for torts ashore, is of limited application to shipboard torts, because of the varieties of legal authority over waters she may navigate. These range from ports, harbours, roadsteads, straits, rivers and canals which form part of the domain of various states, through bays and gulfs, and that band of the littoral sea known as territorial waters, over which control in a large, but not unlimited, degree is conceded to the adjacent state. …
We have sometimes uncompromisingly asserted territorial rights, as when we held that foreign ships voluntarily entering our waters become subject to our prohibition laws and other laws as well, except as we may in pursuance of our own policy forego or limit exertion of our power. Cunard SS Co v Mellon, 262 US 100. … This doctrine would seem to indicate Cuban law for this case. But the territorial standard is so unfitted to an enterprise conducted under many territorial rules and under none that it usually is modified by the more constant law of the flag."