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Colonial Cases

Meikle v. Jardine, Matheson and Co., 1889


Meikle v. Jardine, Matheson and Co.

Supreme Court for China and Japan
Rennie CJ and Mowat AJ, 22 June 1889
Source: North China Herald, June 1889

Shanghai, 22nd June, 1889
(On Appeal from H.M.'s Court for Japan.)
Before Sir R. T. Rennie, Chief Justice, and R. A. Mowat, Esq., Assistant Judge.
MEIKLE (plaintiff and appellant) v. Jardine, Matheson & Co. (defendants and respondents).
  Mr. Lowder, of Yokohama, Counsel for the appellant, having filed a written argument did not appear.
  Mr. C. Dowdall appeared for the respondents.
  This was an appeal from H.B.M.'s Court for Japan in a case in which Capt. Meikle of the British ship Brynhilda sued for some $737, balance of freight on a cargo of coals and coke from Cardiff to Yokohama, which decision was given in favour of the respondents on the strength of a counter-claim in respect to short delivery.
  The Chief Justice said Mr. Lowder's written argument should be taken as read and that the judges had looked into the rest of the record.
  Mr. Dowdall submitted that the judgment of the Court below allowing the damages under the counterclaim the market value at Yokohama of the cargo short delivered was right; and said that Mr. Lowder in the Court below, had not objected to the form of defence, and moreover Scott v. Forrester heard in this Court and reported in the N.-C. Herald of 12th August 1881 showed that.  Under Order XIX rule 3 of 1883 there would be no question on this point.  The judge found as facts, that there was short delivery of 16 tons coal and 37 ½ tons of coke of a  saleable value of $1,037, while the sum deducted by the respondents for the c.i.f. cost, and which was that sued for, was only about $736. The appellants' principal point appeared to be that under the charter party only 5/7 ½ a ton for coal and 15/ a ton for coke short delivered should be allowed for compensation.  As to this, Mr. Dowdall said his clients' rights arose under the Bills of Lading Act of which they were indorsees for value, but as they provided that freight should be paid and all other conditions as per charter party it would not be necessary to refer to that document on these points.
  Now the charter party provided in one place that cost of coals short delivered might be deducted from value of freight and in another place that the penalty for non-performance of the charter party should be the estimated amount of freight, and he argued that as the charter party was worded, this should be looked upon as a special statement of the special way the parties had stipulate that the account of  balance of freight should be made up, that I did not apply to the whole cargo nor give a value which could be looked upon as compensation for what it did apply to and so it should not be taken as concluding the consignee's rights in respect of short delivery; particularly as the penalty clause showed that there was a general right to sue on the contract, and he cited Harrison's v. Wright, 13 East. 343 and Goddard v. Gray L.R., 6 Q.B.139; "Carver's Carriage by Sea," p. 731; Maule and Pollock's Merchant Shipping," p. 252, and Mayne on Damages, at p. 385, on the subject of penalties in charter parties, also at page 285 on measure of damages generally. On these authorities which no doubt the learned Judge of the Court below had considered as well as those he had referred to in the record, Mr. Dowdall submitted that the Judge was right in giving as damages the saleable value in Yokohama of the coals and coke short delivered.
  Mr. Dowdall's next point was that in case their Lordships were not satisfied that it was right to allow market value, the word "cost" in the charter party should be taken to mean cost to the consignees, and that the words "coals delivered short" should be read "cargo delivered short." "Cost" Mr. Dowdall said was an indefinite term, it might mean cost at pit's mouth, or cost at ship's side which would be different, or cost at any other stage of existence of the cargo, and that when a ship owner writes in a charter party "cost" of cargo he is going to carry especially with reference to a possible loss, he must be taken to mean a cost to the consignee. Stewart v. Merchants Marine Insurance Co., cited in the record, will give a rational construction to deeds, Laird v. Robin, 1 Moll. 543 and a liberal construction, "Leggett's Bills of Lading," p. 49, and no construction to render the Bills of Lading nugatory. Gallischen v. Stewart, cited in the Court below.  The word "cost" in the charter party was intended as a modification of the ship owner's liability and should be construed most strongly against him; Burton v. English, cited in the record.  Words may be added by the Court in construing written documents, and the Court may read alterations made in printed forms.  Strickland v. Maxwell 2 C & M. 539, Ramsbottom v. Gosden, 4 Ves. & B. 175, Coles v. Hulme S.B. & C. 568, "Story on Contracts" sec.636, "Chitty on Contracts" p. 718 and "Roscoe's N.P." p. 34.
  Mr. Dowdall proceeding, said the petition of appeal alleged that the respondents were practically identified with the charterers, and though no such suggestion was made in the Court below where it might have been refuted, he would call attention to the fact that the Bills of Lading were practically what the respondents' agents relied on and that the purchase was, of course, not made until the cargo was on board the ship  On this point he cited from the record the "Tradesman's invoice" made out by Messrs. Pirie & Co. who chartered the ship and sold the cargo to the respondents' agents, the master's statement that he signed Bills of Lading to the order of the respondents, the fact appearing in reference to these documents to be that they were for goods shipped by Pirie and Co. and deliverable to "order" simply, and the master's subsequent admission that only on arrival at Yokohama he found that respondents were consignees, etc.  After referring to other matters on this point, and to several other points,
  Mr. Dowdall said - That though allowance of cost at Yokohama would be a sufficient set-off to support the judgment, yet his strong point was that saleable value was the proper allowance to be made.  He left the matter in the hands of the Court.
  The Chief Justice said the Court would take time to consider the case.
25th June.
  This is an appeal from a judgment of the court for Japan in a case where the plaintiff, master and part-owner of the British ship Brynhilda sued for a balance of freight due to him, by the consignees of the cargo.  The defendants admitted the non-payment of the sum in question, but claimed to retain it under a stipulation in the charter party entitling them to deduct from unpaid freight the cost of cargo short-delivered and alternatively pleaded that by reason of the short delivery of 16 tons of coal and 7 ½ tons of coke, they had sustained damages which exceeded the amount of the claim, and which they were entitled to set off against it.  The learned Judge in the Court below held that "cost" in the charter party meant prime cost, but he allowed the counter-claim and gave judgment for the defendants.  The appellant in a written argument now submits that the findings of the Court below, so far as the counter-claim is concerned, were not well-founded either in law or on the evidence.  It may be well that we should deal with the evidence first.
  The first question of fact is whether 37 ½ tons pf coke were short-delivered. The plaintiff contends that the weighing of the coke (which was done on board the ship as it was taken delivery of) was not properly conducted, and was inaccurate.  He urges that he suggested to the defendants that it should be re-weighed on shore which the defendants objected to on the ground that it had been already stowed and could not be re-weighed.  The plaintiff appears to have acquiesced in this, and the learned Judge of the Court below was of opinion that both parties must be concluded by the result of the weighing.  We concur in this view of the matter. If plaintiff was really dissatisfied with the manner in which the weighing was conducted, he should have protested against it sooner and in time to have it re-weighed.  As it is, it appears to be much too late to re-open that point.
  Then the appellants contend that no market value of the coal and coke was proved.  It appears, however, that evidence was given of the selling price of coke being $23.50 per ton, and that of coal $14.40 per ton, each of these rates being largely in excess of the Laid-down cost to the defendants of the coal at Yokohama, and it is to be observed that the amount for which judgment was given on the counter- claim was only the cost of the goods at the port of shipment plus the charges for freight and insurance paid upon them.
  It would seem therefore that the learned Judge had amply sufficient grounds for concluding that the defendants had suffered loss at least to the amount of the judgment.  As regards, then, the facts of the case, we agree with the Court below.
   The appellant next submits that the judgment of the Court below is bad in law, because, even assuming that there was a short delivery of the goods in question, and that their value was properly estimated, the respondents were nevertheless bound by the terms of the charter-party as the controlling contract and could therefore recover no more than the cost price of the cargo at the port of shipment.  He argues in effect that the parties having agreed to permit the cargo owners to deduct the cost of any cargo delivered short of the quantity stated in the bills of lading, the sum so to be deducted must be taken to be the measure of damages agreed upon between the parties in any case of short delivery, and that the word "cost" means cost at the port of shipment.
  We agree that "cost" in the charter-party means cost at the port of shipment, but we do not think that the defendants are thereby precluded from recovering on their counter-claim.  If they were so, the plaintiff would, inasmuch as his freight is a lump freight, be in effect recovering, in respect of cargo which he had not delivered, a sum largely in excess of that which he proposes to allow to the defendants, for while the prime cost of the coal and coke was respectively 5s 7 ½d and 15s per ton, the laid-down cost at Yokohama was 5s and 47s 7d respectively.  This would be manifestly unreasonable, and we think that the defendant must therefore succeed on the counter-claim.   
  The case of the Sailing ship Gardston Co. v. Hickie Borman & Co., (L.R., 18 Q.B.D., 17(, relied upon by the learned counsel for the appellants, is in our opinion no authority against this view. The two points decided in that case were: that a clause in a charter-party, worded as the one now under consideration is, gives the cargo-owner the right to retain out of the balance of unpaid freight the cost of cargo short-delivered, even though the loss has arisen from perils excepted in the charter-party; and (2) that when the loss has happened from an excepted peril, the cargo-owner cannot recover on a claim for damages. In dealing with the latter point, and after the first point had been decided in favour of the cargo-owners, all the learned Judges agreed that the main and most important question that they had to decide in regard to this point, was whether the case came within the excepted perils.  Now how could that question be important unless, but for the case falling within the excepted perils, a counter-claim for damages would lie?  We think we need say no more on this point, and will only add that we concur entirely in the view of the case taken by the learned Judge of the Court below.   
  The appeal must be dismissed with costs.

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