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Colonial Cases

Hong Kong and Shanghain Banking Corporation v. Vincent, 1885


Hong Kong and Shanghain Banking Corporation v. Vincent

Supreme Court for China and Japan
Rennie CJ, 10 March 1885
Source: North China Herald, 18 March 1885

Shanghai, 10th March 1885
Before Sir Richard T. Rennie, Knight, Chief Justice.
  Mr. Wilkinson appeared for the plaintiffs, Mr. Myburgh for the defendant Tug Boat Association, and Mr. Wainewright for the defendants Wilson and Roberts.
  Mr. Wainewright then opened the case for the defendants Wilson and Roberts.  He began by referring to the following list of the issues which he had handed in at the opening of the case:-
Have the owners ever abandoned the treasure?
Has the plaintiff Vincent ever abandoned the treasure, or forfeited his right to salve it?
Whether the China Merchants S.N. Co. in advertising for tenders, advertised only for themselves, or for and with the consent of the plaintiff Corporation, and whether the C.M.S.N. Co. in accepting the tender of the plaintiff Vincent, acted only for themselves or for and with the  consent of the plaintiff Corporation?
Have the plaintiffs or either of them or any person or persons on behalf of them or either of them given permission to the defendants or to any one of them to salve the treasure, or have the plaintiffs or either of them by their acts, words, or contract caused the defendants or any one of them to believe that they o he had such permission, or were o was entitled to salve?
How far was the defendant Morris agent of the defendants Wilson or Roberts, or each of them?
Is the right of the plaintiffs, or either of them to recover, if otherwise established, affected, and, if so, how, by the arrangements mad between the defendant J. Morris and the plaintiff Corporation, or by the acts of the plaintiff Corporation?
If he plaintiffs are entitled to recover from any of the defendants, from which of them? If not equally in what proportion?
Was the treasure at the time of the operations complained of in danger of being lost to the owners thereof?
If the defendants or any of them are or is entitled to salvage, to what sum are they or is he entitled?
If the plaintiff or either of them are or is entitled to recover from the defendants or any of them, to what sum are they or is he entitled?
  He said in regard to the first and second issues that he did no see his way to contest that the owners, or Capt. Vincent had abandoned the treasure, or that Capt. Vincent had forfeited his right to salve it; but he should contend that Capt. Vincent's delay was an important ingredient in the case, as I led to the action which had been taken by his clients.  With regard to the third issue, he thought after the evidence which had been given he could not press that.  It was exceedingly vague; but he thought it must be taken that the China Merchants' Co. were the agents of the Bank in the matter; but while he felt bound to admit that, of course he would be entitled to any benefit that agency might give him.  
  The fourth issue was the important one, and he should contend that the language used by the Manager of the china Merchants' Co., and those associated with him, really amounted to a license to the defendants, Wilson and Roberts, to save.  At any rate, if it did not justify their action, it explained it, and it was an important ingredient in determining whether Wilson and Roberts were not entitled to some remuneration for what they had done.  With regard to whether Mr. Morris was the agent of Messrs. Wilson and Roberts, he should leave that to be dealt with by the evidence.
  With regard to the sixth issue, he contended that the wrong-doer, so far as Captain Vincent was concerned, if there as any wrong-doing, was the Bank; and they had no right to come to this Court as plaintiffs; the plaintiff Vincent ought to have sued the Bank, and not the defendants Wilson and Roberts. Mr. Wainewright then briefly summarised the facts of the four trips made by the Fuh le to the wreck, as shown by the log book which ad been put in; and in conclusion he said with regard to the real position of the divers some evidence would be given, and it would be a question whether the arrangement between the Tug Boat Association and the divers was a binding one, and whether it was such a one as would exonerate the Tug Boat Association from liability in this case.
  Walter Wilson, examined by Mr. Wainewright, said - I am a British subject, and have been a practical diver since 1868; I was trained on board H.M.S. Excellent at Portsmouth. I  Came to China in 1877, and in 1884 I was a diver and tidewaiter in the Customs service.  When I returned from Amoy, from the wreck of the Pakhoi, in January, 1884, I was spoken to by Mr. Roberts and Capt. McCaslin with regard to the wreck of the Hwai-yun.  I was asked by Capt. McCaslin to go down there as diver if the Customs would give me leave. I understood that if I recovered the treasure it would be divided between us.  I left Shanghai on the night of the 18th January.  I had no communication with either the Hongkong Bank or the China Merchant's Co.
  We put back and started again on the 19th and got to the wreck on the 21st.  We saw a boat's mast lashed to the fore-top-mast of the Hwai-yuen.  She had a considerable list to port, by the look of the mast.  I had a deck plan of the vessel.  The next day I went down,  I found silting settling on the deck; against the hatchway and houses there was a six or eight inches, and it was settling very Fast.  During my experience here I observed a considerable increase in the silt; we found more each time we went down.  As a rule, wrecks on this cast silt up very quick; and on account of the soft mud I thought she would very soon silt up and get filled with mud.  I have known a vessel to actually get covered with mud, but that took some years.  The water was muddy; there was no comparison with the water in the Hongkong harbor.  Mr. Roberts, the diver, was not with me that trip, but I was using Mr. Roberts's gear.  We had a verbal arrangement that when we did diving, we should divide, and I always used his gear in private transactions.  During the first voyage I received nothing.
  On the 10th February we got the letter from the Ningpo agent of the C.M.S.N. Co.; it was brought to the wreck by a Ningpo papico.  During that trip we went into Chiuhae and Capt. McCaslin went back to Shanghai and then brought Mr. Roberts to the wreck.  I inferred from that letter that we had got the contract to salve the vessel.  I did not return with the Fuh-le; I remained at Sheipoo.  When the Fuh-le returned and took me on board again, I heard from Mr. Roberts that we had lost the contract through Capt. Vincent saying that I was no diver and that he had to drive me under water with a stick.  There was no truth in such a statement.  The first time Capt. Vincent went under water was under my hands at the wreck of the Sedan in 1879.  I put the dress on him myself, and he did not know whether the escape valve was open or shut.  After the Fuh-le came back with Mr. Roberts I continued diving.  I got into the treasure room and had made fast to two boxes of treasure, when, as I was coming out of the treasure room, my air pipe go fouled, carrying away part of the back of the helmet and necessitating my coming to Shanghai to get a new one.  
  I used two charges of dynamite to break the grating over the treasure room.  The charges used were only enough to cut away the bars over the treasure room and give me room to get down; there was no effect upon the interior of the treasure room.  It is most decidedly usual to use dynamite in such cases.  From my own experience I know native divers use dynamite without any diving apparatus whatever. I got back to Shanghai on the 20th February, and left again on the 21st.  I saw Mr. Morris at his office, in the interval, and Mr. Morris told me that Capt. Vincent had been to the office and stated that they would never get the treasure if they had not a better diver than me.  On that day, the 21st February, I signed the letter of agreement on my own behalf and on behalf of Mr. Roberts.  I signed that letter on the understanding that we should work on the same arrangement as before, that we should still share the profits.  I went with Mr. Roberts to see the China Merchants on the 20th and 21st.  We saw Tong Mow-chee, Chun Fai-ting and Capt. Bolton.  They a sked if we had been successful in finding the treasure, I stated that I had found the treasure-room and got it open and would have brought the treasure, but for the accident which necessitated my return.  They said they were sorry I had not brought the treasure.  They told me that they could not give me power to salve in writing, but if we continued to salve they would not interfere with me.  That was Tung Mow-chee and Chin Fai-ting.  They expressed their indignation at Capt. Vincent not having been at the wreck. The question of our right to salve was freely discussed by all present, and Capt. Bolton and Tong Mow-chee expressed the opinion that I or anybody else could salve if the wreck was left unguarded; and Capt. Bolton said he considered that Capt. Vincent had forfeited the contract by not going to the wreck within ten days after his arrival in Hongkong.  They told me they could not give me a letter to salve; but they gave me a letter giving me permission to go down to fetch some diving apparatus which I had left there, and they told me that if I brought treasure to Shanghai they would be very pleased to see it.  I received no communication from Capt. Vincent denying my right to salve.  Mr. W. C. Howard never said anything to me about it; he never mentioned Capt. Vincent's name to me.  
  I went back on the 21st, continued diving, and recovered five boxed of treasure. I found the wreck had more list and considerably more silt.  The wreck lay side on to the ebb and flood; this would make the mud cut away from the side to which she had a list, so that she would eventually go on her broadside.  At the wreck of the Northfleet at Dungeness in 1876 the mud cut away in this way to such an extent that she broke nearly in two halves.  I came back to Shanghai the next time to bring the five boxes, and because I was unwell.  I wrote to the China Merchants stating that I had five boxes of treasure, and I called upon them.  They told me they had nothing whatever to do with the treasure, and if the Hongkong Banking Corporation identified and claimed the treasure I could let them have it.  I saw Tong Mow-chee and Captain Bolton.  They expressed their pleasure at my having got the five boxes and said they wished I had got the whole.  They expressed their indignation at Captain Vincent's delay, and Tong Mow-chee said he w very sorry he did not revoke Capt. Vincent's contract and give it to me.  Mr. Reding  told me that he was acting on behalf of Capt. Vincent, and he warned me that I ought not to go again.  I told him that as long as the wreck was unguarded I should continue salving - until I was driven off by Capt. Vincent or a representative off his.  Tong Mow-chee said he hoped I would go back and get the remainder.
  I was present at the Hongkong Bank when the five boxes of treasure were opened.  Mr. Hunter and three or four others of the Bank people were present.  The Bank people were delighted to think we had recovered the treasure, and one of the Bank officials said the best thing we could do was to hurry back and get the remainder.  They said the Bank did not care who brought the reassure so long as they got it; they would give 60 per cent to any person who brought it.  That is all that passed, so far as I can recollect.
  The signature to the letter produced is mine, but I have no knowledge of signing it; it was signed on the 5th March - the day I was married. (The letter was addressed to Morris and Co., stating that the witness hired the Fuh-le again to go to the wreck.) I went to the wreck again on the 17th March, and recovered another two boxes of treasure, and I should have continued and recovered the whole of the treasure had it not been for the pilot Smith of Ningpo putting a flag over the wreck and telling me that he represented Capt. Vincent.  It was after I recovered the two boxes that I first saw the pilot.  We recovered those two boxes on the 20th, and as we were going to Sheipoo Roads for shelter that night we were hailed by a pilot boat, but could not hear what they said.  We had the two boxes on board then.  I first saw the flag next morning, and I left that day, and that was the last I saw of the wreck.  I was not present at the Bank when the two boxes were opened.  An electric light would have been of no use at this wreck.  I have seen Chinese dive to 16 ½ fathoms naked, and I have known tem to remain under 75 to 80 seconds.  I think native divers could quite easily have salved this treasure.
  By Mr. Mybugh - I was present at the meeting at Morris & Co.'s office on the 21st February.  The Directors said they could not allow the Fuh-le to go down again unless we had permission given to us to revisit the wreck.  I heard them say they could not allow her to go down on account of the Tug Boat Association.  I then went and got permission from the china Merchants.  I received the accounts produced from Mr. Morris.
  Cross-examined by Mr. Wilkinson - I showed o Mr. Morris the letter from Tong Mow-chee giving me permission to go to the wreck again; and it was after that that I signed the letter of agreement.  The greatest list the Hwai-yuen had, was, I should say, about three feet.  I have seen a great many wrecks; I have been wrecking since 1869.  I have never seen them further than nearly on their broadside; I have never seen them right over.  As a rule they are vessels with a rather sharp bottom that go over. The bottom in this case was soft mud.  We received this latter from the Ningpo agent of the C.N.S.N. C. jst as we were getting under weigh to come away.  All diving is more or less different. At times we would get calm weather for three or four days; at other rimes it would be blowing for three or four days.
  Mr. Wilkinson then read the abstract log of the Fuh-le.
  The defendant Wilson, further cross-examined, said - When the Fuh-le came down I was told that Capt. Vincent had got the contract.  I did not return at once; I continued diving.  The water was not too deep for a Chinese diver to go down.
  Mr. Wilkinson - How was it that when your t was rejected and another man's was accepted, you continued diving?
Defendant - it was fair, because Mr. Roberts told me that we had lost the contract because Captain Vincent had said I was incapable of salving the reassure.  I said I would prove Captain Vincent to be a liar and get the treasure up.
  The Court then adjourned.
Shanghai, 11th Match, 1885.
  The Court opened at 10 o'clock.
  Walter Wilson, further cross-examined by Mr. Wilkinson, said - I believe that log-book of the Fuh-le is correct.  There is no mention of Pilot Smith in the log.  If Pilot Smith were to swear that he saw me hauling up a box of treasure on the 21st March I should say he was telling a falsehood.  Pilot Smith came on board the Fuh-le and told me he was there representing Captain Vincent, and I said I would take my gear away and leave him in charge.  I think that interview should have been mentioned in the log, but it was not my business to enter it.  When we got to the wreck we saw the pilot boat a short distance off; the t came up and came on board.  Pilot Smith was shown the two boxes of treasure on board and was asked to remain on board and see that we took in our gear and did not take up any more treasure.  I saw Capt. McCaslin take Pilot Smith and show him the two boxes.  I think the mate of the Fuh-le ought not to have omitted all this from the log.  I did not recover any of the corpses.  I went into the rooms on deck for them several times, but I found none there.  According to the description given to me, those corpses should have been in the Chinese salon; and I did not go there.  By a three feet list I mean that one rail was three feet higher than the other.  It is impossible to walk on the deck under the water if there is a list, because it is very slippery.  This was not an unusual list.  At wrecks in the Tigris in Persia I have known the silt to be so much that my tools were covered six inches in sand in five minutes.  
  The grating over the treasure-room of the Hwai-yuen was 2 ft. by 8 ft., and the treasure-room was 12 ft. square. A native diver would venture into that, naked. I have not known them to go into exactly such places, but they would go anywhere there was such a big stake.  I have seen natives diving at 16 ½ fathoms.  I should say all of them could stay down for eighty seconds, and some more.  The best divers would probably stop down at the Hwau-yuen for eighty seconds.  The dynamite charges which I sent down by native divers were exploded by electricity.  I have not seen native divers using dynamite on their own account; but I have heard of cases.  The native divers have not got electric batteries; an electric battery was necessary to explode the charges at the Hwai-yuen; it was too deep for time-fuses,  
  After Roberts came down and told me about Vincent having the contract, he continued to assist me in salvage operations.  We agreed to go on with the  salvage.  When we came away finally, we left part of a diving ladder behind; we did not trouble about it.  It belonged to Roberts and me; if I was told that there was a Customs stamp on it I should not believe it.  When I came back to Shanghai about the 20th February I told Mr. Tong Mo-chee that I had ropes fast to treasure. I did not haul it up because I had broken my helmet, and it was necessary for me to go down and guide it out through the small opening.  A native diver would have had to do that.  It carried the basket away when we tried to get it up.  We did not dive from the Fuh-le, but it was of use - far more use than a schooner or pilot boat, because we could get into shelter more easily.  I took all the opportunities I could to dive when we were near the wreck.  The rope had carried he becket away, and so the rope was not actually fast to the treasure when we came to Shanghai.  I told Tong Mow-chee that we had got to the treasure room and made fast to the treasure; but the becket had given way.  I showed him the becket to let him see that it was the becket of a treasure box.  I cannot say what the pressure per square inch on a man's chest at 18 fathoms would be. There is a certain scale laid down by the marine engineers, but I have never studied it.  I only know that I feel a considerable pressure in deep water, with my armour on.  You do not exactly feel it on your chest - principally on the stomach and loins.  If an accident happened and the water got in it would not crush in my chest.  Tong Mow-chee did not say he had revoked the contract; he said he wished he could.
  Re-examined by Mr. Wainewright - Native divers could have got into the treasure room without using dynamite. I used the dynamite to facilitate my work - to save time.  When I met with the accident I swooned in the dress.  I told Mr. Tong Mow-chee that the becket had broken from the box and the rope was no longer fast to it.  I merely signed the log as a witness to the signature of the persons belonging to the vessel, as I thought.  I adhere positively to my statement that the last two boxes of treasure were recovered before I had any communication with Pilot Smith.  I was never asked to sign the second part of the log.  I thought all the time that there was danger of the vessel continuing to list over and making the salvage operations more difficult to carry out.
  John Morris, examined by Mr. Wainewright, said - Captain Vincent called at my office and told me that the tender was accepted.  I think that was the day before he left for Hongkong - about the 2nd or 3rd February.  He asked that we would give him notice if our men recovered any of the treasure, either through Mr. Reding or direct.  When the steamer returned there was no reassure, and I so informed Mr. Reding.  As far as I remember, Captain Vincent remarked that he did not think Wilson was capable of getting the treasure.  I think I showed Mr. Reding a letter to Captain McCaslin telling him to go to the wreck and bring back the divers.  From time to time Mr. Reding asked me about the wreck, and I told him that the Tug Boat Association were not salving, that he Fuh-le was simply hired out, and that if he wished we could let him have another tug boat for Tls. 250 a day to stop the Fuh-le from working. I told him the Fuh-le was chartered to the divers.  I saw Mr. Glover to get permission for the Customs divers to go to the wreck; and I received the letter produced, from Chu Fai-ting (stating that the Customs divers had permission from the Customs authorities to proceed to the wreck for salvage purposes.) When the five boxes were recovered I went to the C.M.S.N. Co.'s office and saw Chun Fai-ting, and he referred me to Captain Bolton.  Captain Bolton seemed to be very glad that the divers had got up the treasure.  I asked him about Captain Vincent's contract, and he said that as Captain Vincent was not there the other divers had a perfect right to salve.  He thought Capt. Vincent had forfeited his right to salve the treasure; and he said Capt. Vincent himself told the China Merchants that it was necessary that operations should be begun immediately.  That is the only verbal communication I had with the China Merchants.  I mentioned what Capt. Bolton had said to me to the divers, I think probably to both, but I am sure I mentioned it to Wilson.
  Mr. Wainewright said he was now cross-examining the witness on the point in which his defence differed from that of the Tug Boat Association. He asked if the arrangement made with the divers on the 20th February was a bona fide arrangement for the hiring of the Fuh-le by Wilson and Roberts.
  Witness - Yes; it was a new arrangement as to the divers hiring the tug boat, but it renewed the arrangements previously made as to remuneration for the tug boat.  The usual rate of the Company for the hire of a tug boat is Tls. 250 a day, and this arrangement was in lieu of the ordinary arrangement.  We had made a loss on the Fuh-le's trips to the wreck up to that time, and I thought we should recoup ourselves.  On the first trip the Fuh-le was out twenty-nine days, and on the second nine; altogether thirty-eight days before the new arrangement as made.  The agreement made with Wilson on the 18th March, being the last trip, was a renewal of the previous agreement.  I first went to the Bank about the salvage operations when we got the five boxes of treasure - on the 10th March.  I first wrote to the Bank to receive the treasure, and that note was taken to the bank by our shipping clerk, and Captain McCaslin went with him.   I then went to the Bank and saw Mr. Walter, and he said he had no record of the bank's arrangement with the China Merchants as to salving the treasure, and as far as I remember he looked through his letter files and books to see if he had any and he could not find any.  I told him I was representing the divers as regards the salvage, and the Tug Boat Association as holding the reassure to secure their lien upon it for hire.  I had several conversations with Mr. Walter at different times, and the result was that he stated that he had agreed or that he understood that the Bank had agreed, to pay 60 per cent for salvage to anyone who brought the reassure to him.  He seemed annoyed - he said he could not understand ow it was - that Vincent had not been to the wreck, and he also said that the Bank would not take any proceedings against the divers.  I wrote the letter produced to Mr. Morris, on the morning after sending the five boxes of treasure; but I received no reply. (The letter stated that the witness was authorised by the divers to formally deliver the treasure up to the Bank on their giving a guarantee to the divers to hold them blameless for delivering the treasure up to them.
  I saw Mr. Walker after that, and he told me he was willing to pay the 60 per cent, and that no proceedings would be taken against the divers.  After reading the letter produced from Mr. Walter, I still adhere to my statement that Mr. Walker promised that the Bank would not proceed against the divers.  I may have asked Mr. Walter, in case Vincent sued the divers for recovering the treasure, what steps the Bank would take; that is the only way I can account for his giving me the promise that the bank would not proceed against the divers.  I believe that my letter of the 13th March to Mr. Walter, which Mr. Walter says he did not receive, was sent to him, though I cannot find any evidence of it in any of my chit-books.
  The Court then adjoined till the afternoon.
  On the sitting being resumed,
  Mr. Morris, further examined, said - I was present when the give boxes of reassure were examined.  I took the two divers and Capt. McCaslin to the Bank and saw the boxes opened.  Mr. Hunter was here, Mr. Jackson, and I think Mr. Byers. They expressed their pleasure that the treasure had been recovered.  The treasure boxes were opened and the dollars were found intact but very black, and thy smelt very bad.  I had my deposit book and Mr. Hunter signed a receipt in that deposit book for three boxes of treasure said to contain $15,000 bought by the Bank at 72 per cent, equal to Tls. 10,800.  They credited Morris & Co.'s account with Tls. 10,800.  I presumed that the other two boxes were kept by the Bank on their own account; I had arranged with Mr. Walter for the Bank to pay over three boxes and keep two.  I credited Wilson and Roberts with that Tls. 10,800 in Morris & Co.'s books. Then I rendered them an account charging them for the hire of the Fuh-le, and with my commission, and paid Wilson and Roberts with cheques for the balances, crediting the Tug Boat Association with the amount charged the divers for the hire of the Fuh-le.  The two boxes subsequently recovered were dealt with in the same way, and I produce a similar receipt for $6,000, being 60 per cent of the treasure in the two boxes, at 72 per cent, Tls. 4,320.that amount was placed to the credit of Morris & Co. The 60 per cent which we received on each of those occasions I considered to be salvage on the amount recovered.  When Wilson brought me Mr. Tong Mow-chee's letter of permission to go to the wreck he said Tong Mow-chee considered he had a right to go to the wreck to salve in the absence of Capt. Vincent.
  Cross-examined by Mr. Wilkinson - In my letter to McCaslin in which I speak of the divers having permission to go to the wreck I referred to Mr. Tong Mow-chee's letter, and also the verbal permission.  I drafted the letter produced, addressed by Wilson to the China Merchants' S.N. Co. and in that letter I referred only to Tong Mow-chee's letter; I did not think about referring to the verbal permission. My intention in hiring the tug boat out to the dives was to get a portion of the treasure if they salved any.  Their intention when they went down that time was to get the treasure if they could.  They had no permission to work there for any length of time because they expected to be ordered away by or on behalf of Cap. Vincent; but they considered that they had a right to salve unless they were ordered away.  They considered tat Capt. Vincent had a right to order them away as regards the salving of the treasure; but they considered that they had a right to salve until they were ordered away.  Under Tong Mow-chee's letter they had no permission to do anything except bring away their gear; but they had verbal permission.  I do not know whether Capt. Vincent could order tm away altogether, or whether he could only order them away from salving treasure; I do not know what his agreement was.  The divers told me they had permission to salve bodies, and if so Capt. Vincent could not order them away from that.  The understanding was that the boat was not to be hired to the divers unless they got permission from the China Merchants to go down.  The difference between the original arrangement and the subsequent arrangement was that in the first case the Tug Boat Association were the principals, and in the second case the divers were the principals.  The first time the Fuh-le went down the China Merchants had, by special permission from Sir R. Hart, borrowed the Customs' divers to go down and salve the treasure if possible.  
  The first voyage was made with a view to tendering for salvage operations; but Mr. Wilson, the diver, had permission from the China Merchants, I believe, to salve for treasure.  Only one of the divers, Wilson, went that time.  If we had salved any treasure that time we should have taken 10 per cent off the proceeds for the steamer's expenses, and we should have divided the balance equally between the Tug Boat Association on the one hand and the two divers on the other and.  On the second voyage the same arrangement   stood; Roberts went down at time.  On each of those occasions the Tug Boat Association were the principals.  On the third and fourth voyages we renewed the arrangement as regards financial matters, but our positions were reversed. He divers were the principals, and we were only the carriers.  We had to render what assistance we could; the crew had to assist in the salving, but they would naturally have to do that if the tug boat was chartered by the divers for salvage operations.  The difference was that on the third and fourth trips the divers were the principals and had command of the expedition.  They could stop work when they liked and order the Fuh-le back to Shanghai.  If they had done that on the first or second rip I cannot say what the result would have been - it is an imaginary case, it did not happen, -but I consider that they were more independent on the third and fourth trips.  
  I drafted several of the letters which were addressed by Roberts and Wilson to the Bank and to the China Merchants' Co.  The Tug Boat Association looked for payment for their hire of the Fuh-le out of what the divers might recover; if they recovered nothing we should have got nothing; we took our risk of that.  We received a portion of the salvage - that is to say, we received from the divers a portion of the salvage which they received.  I was acting as the agent of Wilson and Roberts, and not as the agent of the Tug Boat Association, in receiving the 60 per cent of the treasure from the Bank.  If they had asked me for the whole of that 60 per cent I should not have given it to then,   Mr. Walter agreed to give me 60 per cent of the treasure - as salvage, I understood; what he thought I do not know.  When the treasure was deposited Mr. Walter told us it would remain there on our deposit receipt if we could not come to an arrangement, but some time afterwards Mr. Walter told him that if we had applied to withdraw the whole he should have exercised his discretion as to whether he would give it up or not.  That was long afterwards, when litigation was talked about. Before it was deposited the divers said they thought it had better be deposited in another bank till the matter was settled; but I said it would make no difference, and it was taken to the Hongkong Bank.  Mr. Walter said it could remain in the Bank on deposit - that is, he would give us a deposit receipt for it - until it was decided what to do.  We deposited it there pending our negotiations with Mr. Walter as to what was to be done.  Afterwards I was distinctly told by Mr. Walter that he was willing to pay 60 per cent to the salvors; I do not remember that he accompanied that with any statement that he would not bind the Bank with any arrangement as to salvage.  I do not remember his saying that the treasure was in the hands of the China Merchants Company, and he could make no arrangements; In fact h said he had no documents in is possession at all respecting the matter.  I asked Mr. Walter if he would give us a written permission to the Tug Boat Association for the divers to go down, and he said no, but he would not prevent their going down, and if they brought him any treasure he would pay them 60 per cent for it.  He said distinctly that he was prepared to receive 60 per cent for salvage; he did not say that he would tale 40 per cent as a settlement, but he certainly took the 40 per cent and paid us 60 per cent. He did not say that he would give us 60 per cent of the treasure if we wanted it, or any proportion we liked; I swear that my understanding was that he agreed to pay 60 per cent for the salvage; I do not know what his understanding was.  At first he evidently did not know what to do; but ultimately he decided that the Bank had agreed to pay 60 per cent, and he was quite prepared to pay it to anyone who brought the treasure; Capt. Vincent had not brought the treasure, and these other men had, and he would pay then the 60 per cent.  
  With regard to the second lot there was the same arrangement; there was no trouble about that.  We brought the two boxes in, and ty remained there for one or two days and 60 per cent was passed to my credit.  I asked that the amount might be passed to my credit.  It was before the 11th March that Mr. Walter assured me that the Bank would not take any proceedings against the divers.  I cannot remember the details of the conversation; I only remember the rest of it - that the Bank would not proceed against the divers.  The treasure was in the Bank at that time, under a safe-custody receipt.
  Re-examined by Mr. Myburgh - The directors gave me distinct instructions with regard to the hiring of the Fuh-le, and when I made the arrangement with the divers I considered I was carrying out those instructions and simply hiring it out.  I told Wilson he must get permission from the China Merchants' Co. before going down because I did not consider that he would go down without permission.  I knew that our tender had been rejected, and that we had been asked to withdraw our men from the wreck.  We thought it was necessary that he should have permission to go down to the wreck before going down, but I cannot say what we thought the consequences would be if the tug-boat was hired and went down without permission.
13th March.
  The Court opened at 10 o'clock.
  John Roberts, examined by Mr. Wainewright, said - I am a British subject and an Assistant Examiner and diver in the Customs, and a defendant in this suit.  I was first a diver in 1868, and since 1872 I have practically done nothing but diving.  I have salved from fifteen to twenty wrecks - several of them for the China Merchants' Co.  I know Mr. Chun Fai-ting well,  In January, 1884, I met Mr. Chun Fai-ting in Hankow Road and he told me he had applied to the Chinese authorities for permission for me to go down to the wreck of the Hwai-yuen to examine her with a view to raising treasure, valuables, etc., but principally bodies.  I heard nothing for several days, and then I was directed by my immediate superior in the Customs to do anything that was required of me by the C.M.S.N. Co. at the wreck. The China Merchants referred me to Mr. Morris for a passage to the Hwai-yuen.  Mr. Chun Fai-ting referred me to Mr. Weir, Superintendent Engineer of the C.M.S.N. Co., who gave me a deck plan of the vessel.  This would be after the 17th January - after the advertisement appeared.  He assured me that if there as any contract made, as long as the Customs lent me, I should be sure to get the contract for salving the Hwai-yuen.  I went to Chiuhai in the tug Rocket, joined the Fuh-le here, and went to the wreck.   I had the only suitable diving apparatus in Shanghai, on account of the depth of the water, for wrecking the Hwai-yuen.  I had lent it previously to Mr. Wilson, and I had gone done in the Fuh-le.  I had an arrangement with Mr. Morris before lending my apparatus that we were to take not less than fifty per cent for anything we recovered, and that we were to share alike - the divers half and the Tug Boat Association. I had a verbal arrangement with Wilson that we were to divide equally.  I proposed at that time to work at the wreck at that time.
  Mr. Simpson, being in attendance, was here recalled for cross-examination.
  Cross-examined by Mr. Wilkinson - The Directors of the Tug Boat Association approved of all that was done by Mr. Morris in the matter.  I left the Board in the early part of March, 1884, and I am no longer on that Board and cannot speak for them now.
  Re-examined by Mr. Myburgh - The tug boat, the second time, went down on her own account; after that she was hired by the divers.
  His Honour asked if any further evidence was to be offered on that point.
  Mr. Wainewright said he had no further evidence to offer upon it.
  His Lordship said if no further evidence was to be given it would perhaps save time if he said what he thought.  It appeared to his Lordship quite clear that although the Directors and Mr. Morris might have acted perfectly bona fide, subject to any authorities that might be cited or any arguments that might be addressed to him, the arrangement was what the law would call a colourable one.  He did not mean to impute any ill-faith to anyone, but still there was no substantial difference between the terms made with the divers after the first two trips and the terms on which they had been working before, and it appeared to him that it was clearly a colourable arrangement in the eyes of the law.
  Mr. Roberts, further examined, said - When I got to the wreck I observed the position of the wreck and took soundings.  I agree with the evidence which Mr. Wilson gave us.  I can say from the time I remained at the wreck.  I was then about twenty days.  I did not go back after the 20th February.  When the weather would permit I generally superintended the diving operations, but I did not go down myself.  From my previous experience of wrecks in China I should certainly say there was danger of her silting up or turning over.  I have known several instances of that in China waters.  The wreck of the Georgina turned completely bottom up, and the wreck of the Aden was nearly covered in less than a month.  The gun-boat Fushun sunk by the French at Foochow went down upright, and when I went down shortly afterwards it had turned completely over,  
  I received the letter from the Ningpo agent of the C.M.S.N. Co. and I thought that I confirmed what Chun Fai-ting had told me, and that we had the contract.  I thought they would never write such a letter if the contract had been given to some one else.  We returned to Shanghai for provisions and coal on the strength of that letter.
  His Lordship thought he should hardly have drawn that inference from the letter himself.
  Witness - We arrived in Shanghai on the 11th and returned on the 12th.  I saw no one in Shanghai connected with the wreck.  We remained at the wreck till the 20th.  Wilson got into the treasure room and got hold of some treasure; but the becket carried away from the box and I brought it to Shanghai.  Two charges of dynamite were used; I was proper to use it; it was principally used at my suggestion.  I have been using dynamite for a number of years; its effects vary considerably according to the position in which it is placed.  I have seen dynamite used by natives without diving apparatus. I have known native divers stop down from 50, 60, 70, 80 or even 90 seconds.  I have used them in the chow-chow water in Shanghai river - 16 fathoms.  I have seen them dive in 16 ½ fathoms in Amoy.  Dr. Ward Hall was here when the divers were diving in from 14 to 16 fathoms.  Dr. Ward Hall timed them. I think native divers could have got the treasure, from what I have seen tm do.  Several native boats came to the wreck, and buoys and ropes were stolen on several occasions.  After I got back to Shanghai on the 20th I was told that I was to go on with my duties at the Customs.  I went round to the China Merchants to see Mr.  Chun Fai-ting.  I asked if it was true that they had told the Customs they had finished with my services; he said yes.  I asked why he had broken his faithful promise to give me the contract, and he said Capt. Vincent had told them that Wilson would never get the treasure, and he had to drive Wilson under water with a stick.  I said he had acted very unfairly towards me after I had dived for him for ten years, and he asked me not to be angry at losing the contract, and he would do what he could for me.  He gave me permission to go back to the wreck and get my gear; but I told him I could not go, as the Customs authorities had forbidden me to go, and it was torn up.  He told me that Chu Yu-chee had relatives drowned in the Hwai-yen, and told me he would be glad to get these bodies and said he would be only too happy, if we recovered any of the treasure, to pay us the usual percentage as any one else.  Mr. Wilson was present, and Mr. Tong Mow-chee, Mr. Chun Fai-ting, Mr. Reid, and Chu Yu-chee.  Chun Fai-ting gave me descriptions of the bodies of Chu Yu-chee's relatives, and described the rooms in which they would be likely to be found.  He said the Hongkong Bank would be glad to get their treasure, and Capt. Vincent had broken his contract by not being there at the rime.  Tong Mow-chee said they would give us the same percentage for recovering the treasure as they would anybody else.  Capt. Howard never said anything to me ion behalf of Capt. Vincent about not going back.  I am aware that Mr. Wilson went back on the 21st February.  
  After we had left the China Merchants' office we called on Mr. Morris.  I promised Mr. Wilson to lend him my diving apparatus providing the Tug Boat Association would lend the tug; and I believe Mr.  Wilson chartered the tug from them.  It was mentioned to me about hiring the tug, but I said I could not be the principal in anything because I was in the Customs; but I said I was so certain that Wilson would get the treasure that I should undertake to pay the Association $500 if he came back without any.  
  The arrangement was that I was to get half of what Wilson received.  Mr. Wilson had no authority to sign my name to the letter by which he offered to hire the tug.  I was dealing entirely with Wilson. The agreement was that if he could get the tug I would lend him my diving gear and I was to get half of whatever Wilson got.  The next I heard was hat the boat had arrived with five boxes of treasure.  I was present at the bank when it was opened.  I heard a conversation between Mr. Wilson and Mr. Morris before that.  I heard Mr. Walter tell Mr. Morris that they had no contract and that they would be willing to pay the percentage to any one who brought the treasure.  That conversation took place between the door of the manager's office and the counter.  I went in with Mr. Morris to see the manager.  I heard what Mr. Wilson said as to the time when the treasure was opened.  My recollection of that agrees with his.  The electric light would have been of no use whatever at this wreck; the water was so thick.  I never went to the Bank after that.
  Cross-examined by Mr. Wilkinson - I have used the electric light under water and do not approve of it.  I have never tried it in clear water.  We did not recover any bodies.  The diver's ideas were to recover the treasure first and the bodies afterwards. Mr. Howard is my superior officer on some occasions; but not when diving.  Mr. Henderson told me that the China Merchants had finished with my services; that applied to Wilson as well as myself.  M. Chun Fai-ting promised me faithfully that I should get the tender.  He said "On account of your previous service you will get the tender."  I took it as a faithful promise on his part, and I took his word for it.  The Aden was in open sea, outside Taku Bar.  She canted over and settled down.  She sunk in 16 feet t high water; her deck houses are out of the water, exposed to the wind. The other two wrecks were in rivers.  The Fushun had a big gun, but it was suposed to have gone out when she went down stern first; we could not find it.  The gun-boat was flat, and the gun was in the centre of the ship.  The Aden disappeared by cutting away and capsizing on her broadside.  The Georgina capsized altogether in Shanghai river, abreast of the beacon.  I had no conversation with Mr. Chin Fai-ting about the letter from the Ningpo agent after the 20th February.  The bodies might have been in the reassure-room; the body of the cook of the Kwangtung was found in the treasure room; perhaps he was stealing.
  On the 11th or 12th February when I went back to the wreck on the Fuh-le I was told after I got on board, by Capt. McCaslin, that Capt. Vincent had the contract, and that he was going to fetch back Mr. Wilson and Mr. Lathan.  I told him that if he went away I should remain at the wreck in a native boat.  I should certainly not attribute Mr. Wilson's accident to the use of the dynamite.  Mr. Chun Fai-ting refused to give us a letter in writing to recover treasure; but he said as long as we had permission to go to the wreck anything we got they would pay us for.  He repeatedly said that he considered Capt. Vincent had revoked his contract.  I cannot tell the date on which I heard Mr. Walter say that they had no contract with anybody.  He said he did not know Vincent and did not know anything about the contract with him and would pay the per centage to anyone who brought the treasure.  I think it was after the Fuh-le left on the 21st; I am positive that it was before the treasure was recovered.  I did not go into the manager's office; but they stood talking at the door, and I was standing there.  The vessel had not an unusual list.
  Captain McCaslin, examined by Mr. Wainewright, said - I went down to the wreck four times - twice for the Tug Boat Association and twice for the divers.  I had a letter, which I have lost since, stating that the Fuh-le was hired to the divers.  When we first visited the wreck the native boats came there, I suppose to get whatever they could; to pick up anything we might haul up and let go.  I had nothing further to do with the diving other than to assist - to give them ropes, and anchors and buoys, and that sort of thing.  I could see each time we went that the wreck was cutting more and more.  She was lying in the tide-way, and the ebb tide being stronger that the flood would probably cut away the mud from under her port bilge.  I have had no experience of native divers except in shallow water.  The second time I took Roberts down I don't recollect whether I told him particularly about Vincent having the contract; but I remember Roberts saying that he would stop there in a native boat, and he asked Hoar if he would stop with him.  Hoar did not agree; he could not, because I had hired him as pilot.  We do not keep a regular log on board the Fuh-le; we are not insured, and it is not necessary; we only keep a sort of diary.  I got these extracts from the diary (the abstract log) signed by the mate and Mr. Hoar and Mr. Wilson.  
[Remainder of this report belongs to another case. There are no further reports of these proceedings.]

Published by Centre for Comparative Law, History and Governance at Macquarie Law School