the loss on the goods {t).
The case {u) which decided these points was as follows : —
A collision occuiTcd between The Croini Prince and The
Afjeh, a ship belonging to the owners of The Crown
Prince^ by the fault of both ships. The question arose
whether the shipowners were liable to the owners of cargo
shipped on board The Croivn Prince under a bill of lading
containing exceptions of, amongst other things, " colli-
sion," and " accidents, loss, or damage from any act,
neglect, or default whatsoever of the pilots, master, or
mariners, or other servants of the company in navigating
the ship." It was held that the shipo'wners were not
liable upon the contract of carriage. Baggallay and
Lindley, L.J J., were of opinion that the exception of
" collision," although it did not cover the negligence of
The Crown Prince {x), did cover that of The Afjeh ; and
further, that the negligence of Tlie Croivn Prince was
(a) The liernina (No. 2), 12 P. D.
36.
{t) Chartered Mercantile Hank, ifr.
\. Netherlands, ^-c. Co., 10 Q. B. D.
621.
(«) Ibid.
[x) Lloyd V. General Iron ScreiO
Collier Co., 3 H. & C. 284 ; Grill v.
General Iron Screiv CMicr Co., L. R.
1 C. P. GOO ; lb. 3 C. P. 476,
COI,LISTOX HETWKKN STITPS OF SAMi; (JWNKR. 285
covered hy the otlier exception stated above. lu I ho Court
below (//), Pollock, B., and Manisty and Stephen, J.J.,
considered that the shipowners were not protected by the
exception of " collision," on the ground that, since liability
for loss by collision caused by the fault of the carrj'ing
ship is not excluded by that exception, neither is loss by
collision caused by the fault of the carrying ship and
another belonging to the same owners. Pollock, B., and
Stephen, J., liold that, though the second exception would
have protected the shipowners, if the collision had been
caused entirely by the fault of T//e Croini Prince, it had
no application to a ease where both ships were in fault.
Manisty, J., held that the contract in the bill of lading
was express, to carry and deliver the goods safelj', subject
to certain exceptions, which did not include negligence of
those on board The AfjeJi. Pollock, B., appears to have
held the shipowners were liable as common carriers, being
unprotected by the terms of their bill of lading.
As stated above, the Court of Appeal reversed the deci-
sion of the Court below as to the liability of the ship-
owners on the bill of lading. But the shipowners were
held liable in tort (~) for the negligence of their servants
on board The Afjeh, though, by reason of the rule as to
di\dsion of loss, for only half the loss.
The rule as to division of loss where both ships are in Rule as to
fault does not affect the right of a cargo-owner to recover iogs"^'^^
full damages for breach of the contract of carriage aa-ainst
the owner of the carrying ship, though the other ship was
also in fault for the collision. But it abridges his common
law right, as against the owner of the other ship, by limit-
ing the liability of the wrong- doer to one-half the loss («) ;
(y) 9 Q. B. D. 118. {a) The Milan, Lush. 388 ; Chap-
[z) Astotheliability of tlieship- man v. Roi/al Netherlands Steam
owner in tort as well as ujion the JS'avii/ation Co., 4 P. D. 157, 165;
contract, sec Monjan v. I'cvaz, ti II. Chartered Mercantile Bank of India
Scia. 2Gb ; Fontife.vx. Midland liaiL v. Netherlands India Steam Xavi-
Co., 3 Q. B.D. 23. (/ation Co., 10 Q. B. D. 521. The
286
shipowner's liability as caukier.
Exception of
" barratry"
does not
cover negli-
gence of
carrying
ship.
Whether ex-
ception of
' ' perils of the
sea " covers
infring'ement
of the Regu-
lations.
and tliis is tlie case even where the two ships belong
to the same owner (b). If part of the loss on cargo is
recovered against tlie owner of the carrying ship, the
residne, up to one-half the loss, may he recovered against
the other ship (r).
Damage to goods in a collision caused by the negligence
of those on board is not covered by an exception of barratry
in the bill of lading (d).
Shipowners contracted with a passenger that they should
not be responsible for any loss or damage arising from
perils of the sea .... or from any act, neglect, or de-
fault whatsoever of the pilot, master, or mariners. It
was held that no damages could be recovered for the death
of the passenger, who was killed in a collision for which
the carrying ship was in fault (c).
Where the collision is caused by an unnecessary, but
not negligent, breach of the Regulations for preventing
collisions at sea, so as to cause the ship to be deemed to
be in fault under 36 & 37 Yict. c. 80, s. 17, it seems
to have been considered by Brett, M. R., in Woodley v.
Michell (/) , that the shipowner would be liable for damage
to cargo, notwithstanding an exception in the bill of lading
of " perils of the sea." Sed qu.
Milan, iihl supra, so far as it de-
cides that the innocent cargo-owner
can recover no more than half his
loss against the other shiji, has nut
been followed in America. It has
been held by the Supreme Court
that the innocent cai-go-owner is
entitled to a decree for the whole
of his loss against either of the
wrong-doing shijis if one only is
sued ; if both are sued he is en-
titled to a decree for half his loss
against each ; and if a moiety of
his loss exceeds in amovint the
statutoiy liability of either of them,
or if, for any other reason, he fails
to obtain half his total loss from
either of them, he is entitled to a
further decree a gainst the other for
the difference ; see The Alabama
and The Gampcock, 2 Otto, 6!).j ;
TIic Jdiilatri, ;] Otto, 337; The Atlas,
ib. 302 ; The Vir'/iaia EJirmaii, 7
Otto, 309 ; The C'iii/ of Jfartford and
The Unit, ib. 323 ; The City of Far is,
14 Blatchf. 531 ; The Civilta and
The Jiesttcss, 13 Otto, G99 ; The
FJco)wra, 17 Blatchf. S8.
{b) Chartered Mercantile Bank of
India v. Netherlands India Steam
Navlqation Co., uhi supra.
{e) The Demetrius, L. R. 3 A. &
E. 523.
(d) Grill V. General Iron Screw
Collier Co., L. R. 3 C. P. 47G.
(e) Ilaig v. Eoi/al Mail Steam
racket Co., 52 L. J! Q,. B. 395, G40.
(/) 11 Q. B. I). 117.
RAILWAY COMPANY — CHAIITERER — MASTER. 287
A railway company carrying passengers by land and Effect of
sea attempted to free themselves from liability for the carrier will
negligence of their servants by repudiating such liability "°* ^^ ^[^^^^
. for nei^li'*"euc6
in public notices and advertisements. AVhere, after pub- of sen-ants,
lication of such a notice, a collision occurred between a
ship employed by the railway company, with cargo and
passengers on board, and anotlier ship, by the fault of
the former, it was held that, under the Acts res'ulatino-
their steamship traffic {(/), the company were liable to
the passengers and cargo-owners, notwithstanding the
notice (//).
Whether the shipowners are liable to the charterer for Shipowners'
loss sustained by the latter in consequence of a collision eh)^rtf7 *f
for which the chartered ship is in fault, will depend upon 'p':'^ by col-
the terms of the charter-party. Where such liability
exists, it will extend to expenses of salving the cargo which
have been paid by the charterers or their underwriters (/).
In a case (/«•) where the officers and crew were the
servants of the owner, though by the terms of the charter-
party the ship was " placed under the direction of " the
charterer, it was held that the owners were liable to the
charterer for loss sustained by the latter in consequence of
the ship getting ashore by the negligence of her crew.
The master, as well as the owner, is liable for the loss Liability of
of goods taken on board by him as a common earner (/). "arrier''^
And it is said that he is liable for the negligence and mis-
feasance of his officers and crew (m) . In America, it was
(ff) The Railway and Canal the Court as establisliincr flmt the
Traffic Act, 1854 (17 & 18 Vict. owners would bo liable to third
c. 31) ; 2G & 27 Vict. c. 92, s. 31 ; j^arties for the nee-li>,^cnce of the
34 & 35 Vict. c. 119, s. 12. crew. Cf. T/ie Ta^niania, 13 P. D.
(A) Boolan v. Midland Rail. Co., 110.
2 App. Cas. 792. (/) Morse y. Slew (or Slue), 3 Keb.
(t) Scaramanqa v. Marquand, 5 72, 112, 135 (best report) ; Raym.
Asp. M. C. 410, 506. 220 ; 1 Mod. 85 : 1 Ventris, 2*38 ;
(/••) Onioa and Clelaiid Coal and Jioucher v. Lawson, Cas. t. Hardw.
Iron Co. V. Hiaitkij, 2 C. P. D. 404. 85, 194.
Amongst other cases, Fletcher v. («;) Story on Agency, §^ 314 —
Braddkk, 2 B. & P. (N. R.) 182, 317; 3 Kent's Comra. 218 ; MoUoy,
seems to have been roliod on by 1. 2, c. 2, s. 13.
288
SPIirOWNETl S LIABILITY AS CARRIER.
Jurisdiction
in Admiralty
in case of
damage to
cargo.
held that the master was liable to a passenger on board
liis ship who was injured by a collision caused bj the fault
of the pilot, and not by the fault of the master {ii).
There is jmisdiction in Admiralty in respect of a claim
by the owner, consignee, or assignee of the bill of lading
of goods carried into any port in England or Wales (o) , for
damage to the goods by the negligence or breach of con-
tract by the owner, master, or crew of the carrying ship,
provided no owner or i:)art owner of the ship is at the time
of the institution of the action resident in England or
Wales (;;). To enable him to sue, it seems to be necessary
that the property in the goods should have passed to
him ((/). Though the statute gives a right to proceed
against the ship in Admiralty, there is no maritime lien
for damage in such a case (r).
The right of the shipowner to recover against the cargo-
owner general average contribution for the expenses of
raising his ship sunk in collision, is considered else-
where («).
The application of the Act limiting the liability of
shipowners upon the contract of carriage to an amount
depending upon the tonnage of their slup, is considered
above in connection with the subject of limitation of
liability (f) . It may be here noticed that railway com-
panies carrying by sea in ships not owned by themselves
are entitled to the benefit of this Act in some cases in
which other carriers by sea are not {>i).
{)i) Denison V. Sei/monr, dWend. 9.
(o) As to tlic meaning of this
term, see T/ie Bahia, Br. & L. 61 ;
The Fieve Supcriore, L. R. 5 P. C.
482 ; The Dantzic, Br. & L. 102.
{p) 2-1 Vict. c. 10, s. 6; 36 & 37
Vict. c. 66, s. 16.
{({) See The Freedom, L. R. 3 A
& E. 495, following The St. Cloud
Br. & L. 4 ; The Nortmy, Br. & L
377. Tlic coiitraiy has been held
by Sir R. rhilliniore, though the
facts did not render a decision upon
the point necessary. See The Tiglia
Mafigiore, L. R. 2 A. & E. 106 ;
The Xepoter, ibid. 375. It does not
appear that these cases were cited
in The Freedom.
(/•) TJie Fieve Siqicriore, L. R. 5
P. C.482.
(.y) Fnfra, p. 302.
{t) Supra, pp. 161 seq.
{«) See supra, p. 178.
INSTRAXCE.
289
Collision with reference to the Contract of
Insurance.
Loss by a collisiou wliick occurs witlifjut fault in either insurer'ts lia-
sliip is a loss by peril of the sea within tlie meaning of ^(j/i^^i^^j -^J^^
that term in an ordinary policy of insurance on ship (.r). withont fault
And loss by collision caused by the negligence of the -^YTierc it is bv
other ship is a peril of the sea for which underwriters are the fault of
liable (?/). Where the collision is caused by the fault of „^" '*'.'^'^.
. , Where it is
both ships, or of the insured ship alone, it seems that the by the fault
imderwriters are liable for the loss on the insured ship (z). orof^iusured
The principle is that, where the loss is caused by a peril ship alone.
insured against, the insurers are liable, although the loss
was also caused by the negligence of the insured or his
servants (a). In such cases the loss is said to be caused
proximately by the peril specified, and remotely by the
negligence, and the maxim caiisa proximn non remota spec-
tatiir applies {h).
Expenses arising from delay caused by collision are not Demurrage
recoverable under the ordinary Lloyd's policy (c). nm^^"'*^^
{x) In Buller v. Fisher, 3 Esp. 284 ; Davidson v. BurnamI, L. R.
67, it was held to be within the 4 C. P. 117, 121.
exception of " perils of the sea " in (i) See further as to this subject,
a charter-party ; iVfj/^ijOS V. i/«<7/Jc, Park on Insurance, Sth ed. 139;
3 Dougl. 374. Aruould on Insiu-auc(\ otli ed. 744
(//) Smith \. <Sco<^, 4 Taunt. 126; — 746; Fliillips on Insurance, §§
and see/;6V Lord Cairns, C, <S'i/H;jAO» 1417 — 1420; Himpson v. Thompson,
V. Thompson, 3 App. Cas. 279, 286. 3 App. Cas. 279. Cf. French Corn-
See also Zf/y/Ac v. jl/(7;-.s/(, 1 M 'Cord, mercial Code, Arts. 350 and 353 ;
360, cited in Augell on Carriers, Spanish C. C. Art. 861 ; Dutch C.
oth ed. 153, note, as to the law in C. Art. 637 ; German C. C. iVrts.
America. 824 and S25. By the two first
(c) JDe Vaux v. Salvador, 4 Ad. & codes, only aborda(jcs fortiiils, by
E. 420 ; Simpson v. Thompson, 3 the others, all collisions, are at the
App. Cas. 279 ; The Fotomac, 15 insurer's risk. It has been held
Otto, 630 ; General Mutual Insiir- that loss in a collisiou caused by
ance Co. v. Shcrivuod, 14 How. 351 the fault of those on board the
(the last two are American cases) . carrying ship does not arise from
(rt) Dixon V. Sadler, 5 M. & "W. barratry, within the meaning of
414, 415; S. C. on app., 8 M. & that term in a bill of lading : Grill
W. 895 ; Walker v. Maitland, 5 B. v. General Iron Screw Collier Co.,
& A. 171 ; Busk v. Itoi/al E.rchange L. R. 3 C. P. 476.
Assurance Co., 2 B. & Aid. 73 ; (c) Be Vaux v. Salvador, 4 A. &
Dudffeon v. Pcmbrokr, 2 App. Cms. E. 420.
M. U
ansmg
from colli.sion.
290 COLLISION WITH REFERENCE TO INSURANCE.
The "run- gy fj^g q1(J form of marine policy the insurers did not
ning-down ^ , . - ,
clause. imdertake to repay to the assured damages which may be
recovered against them for a collision in which their ship
was in fault ((/). But it is now usual for the insurers
upon a Lloyd's policy, by a special clause, known as the
" running-down " clause, to agree to pay three-fourths of
any such damages ; and the remaining one-fourth is fre-
quently covered hy sejjarate insurance.
A common form {c) of the running-down clause in a
Lloyd's policy is as follows : —
"And it is further agreed that if the [ship], hereby in-
sured, shall come into collision with any other ship or
vessel, and the assureds shall in consequence thereof
become liable to pay, and shall pay, any sum or sums
not exceeding the value of the said vessel hereby assm-ed,
we, the assurers, will severally pay the assureds such
proportions of three-fourths of the sum so paid, as our
respective subscriptions hereto bear to the insui'ed value of
the said vessel. And in cases where the liability of the
ship has been contested, with oiu" consent in writing, we
will also pay a like proportion of three-fourths of the costs
thereby incurred or paid. But this agreement is in no
case to be construed as extending to any sums the assureds
may become liable to pay, or shall pay, in respect to loss
of life or personal injury to individuals from any cause
whatever."
A running-down clause expressed to cover damages
which the assured ship shoidd be compelled to pay for
running down and damaging another ship was held not
to include damages recovered against the insured ship by
the rejiresentatives of persons on board the other ship who
[d) Dc Vanx v. Salvador, 4 A. & Droit Mar. tit. Abordage ; and by
E. 420. This case, once dissented German law : German C. C. Art.
from in America, is now recognized 824.
as binding by the Supreme Court : [e) This form is taken from
Gentral Mutual Insurance Co. v. Maude & Pollock on Shipping,
Sheruood, lAllow. Zo2. Aliter hy 4th ed. 44G.
French law : Caumont, Diet, do
RUNNING DOWN CLAUSE. 291
lost their lives in the collision (./') . In another case {y) a
similar clause was held not to include costs which the
insured inciu'red in defending a collision action brought
against his sliip. In the form of policy in use at Lloyd's,
these points are now expressly provided for ; the insurers
undertake to repay three-fourths of the costs, if the liability
of the ship is contested with their consent ; and damages
for loss of life or personal injmy are expressly left at the
risk of the assured.
A ship was insured in a policy containing a running-
down clause, by which the insurers undertook to bear
tliree-fourths of any sum, not exceeding the value of the
ship and freight, which the assured should become liable
to pay, and should pay, for collision with another ship.
The ship insured was sold in an Admiralty damage suit
for less than her value. It was held that the underwriters
were liable for no more than tlii*ee-fourths of the sum for
which the ship was sold (//) .
Tlie Bahiacmig (^) was insured with the London Steam-
ship 0^\^lers' Insurance Association against "loss of or
damage to any other vessel ... so far as such loss is not
covered by the usual form of Lloyd's policies with the
clause commonly known as the nmning-down clause at-
tached." She was also insured with the same association
and at Lloyd's against the usual maritime risks, including
collision. Whilst so insured she came into collision with
The Karo, and in the collision both sliips received damage,
but the loss to T/ic Balnacraig exceeded that to The Karo.
Both ships were in fault, and the owners of The Karo
(without any action being brought by or against them)
paid to the owners of The Balnacraig the difference between
(/) Taylor v. Dewar, 5 B. & S. {h) Thompson v. Eei/nolds, 7 E. &
58 ; but the contrary has been held B. 172.
in Scotland. C'oei/ v. Smith, 22 Court (J) Lo)idon Steamship Owners' In-
of Session Cases, 955 ; Excelsior Co. surance Co. v. Grampian Steamship
V. Smith, 2 L. T. N. S. 90. Co., 24 Q. B. D. 32 ; affirmed on
{g) Xenos v. Fox, L. R. 4 C. P. app., 62 L. T. N. S. 784.
GG5.
u -i
292
COLLISION WITH REFERENCE TO INSURANCE.
Insurance
against
servants'
neglio-ence.
half the losses on the two ships respectively. The question
arose (in a claim for a set-off in an action for money re-
ceived by the defendants, The Balnacraig owners, for the
use of the plaintiffs, the Insurance Association), whether
The Balnacraig owners were entitled to recover against
the Association a sum of 51/., which sum represented one-
fourth of the damage suffered by The Kara in the collision,
and had been taken into account iu reduction of the amount
j)aid by her owners to the owners of The Balnacraig. It
w\as held by Mathew and Wills, JJ., that The Balnacraig
owners were entitled to receive nothing from the Associa-
tion ; that the collision clause in the Lloyd's policy never
came into o]3eration, because nothing was ever paid or
payable by TJte Balnacraig owners to The ICaro owners.
The principle laid down by The Khedive (/.•) (said Ma-
thew, J.) was, that "neither in fact nor in law is the owner
of the assm^ed ship liable to pay or entitled to receive more
than the balance which equalises the loss ;" and the words
of the collision clause, *' become liable to pay and shall
pay," showed that it was intended to operate only where
the balance of loss by collision being against the assured
ship, she had to make a ^Jayment to the other ship.
It is a maxim of insurance law that the assured cannot
seek indemnity for a loss produced by his own wrong-
doing (/) . But this rule does not invalidate a contract to
indemnify the assured against damages payable by him in
respect of loss caused by the negligence of his servants (w).
Any doubt that formerly existed as to the validity of such
insurances (m) is removed by 25 & 26 Vict. e. 63, ss. 54, 55.
They may be effected without a policy (o), and have given
rise to a new and special class of insurance societies or
clubs (;;) .
{k) 7 App. Cas. 795.
\l) See per Lord Campbell,
Thompam v. Hopper, 6 E. & B. 172,
191.
(w) See Thompson v. lieyyiolds, 7
E. & B. 172; Wallcerv. Maitland,
5B. &A. 171.
(«) See Anonymous Case, 5 Taunt.
605.
(o) 30 & 31 Vict. 0. 23, s. 7.
{p) See Amould on Insurance,
5th ed. 724.
SUimOGATIOX OF ASSURERS 'lO RIGHTS OF ASSURED,
293
If a ship receives her death wound in a collision which Loss after
occurs during a voyage or time for wliich the ship is in- ^"j,^7''d fr
Bured, and she sinks after the completion of tlie voyage or colliMion
time, a question might arise as to the liability of the during"^
insurers. In a case mentioned by Willes, J. ((/), but not voyage,
reported, tlie insurer (r) was held not liable in such case.
In Kiiiyhf \. Faith (.s), a somewhat similar case, the case
above referred to was doubted, and. underwriters on a time
policy were held liable for a partial loss.
^\iter jiaying the amount due upon the policy for a total Insurers sub-
loss the insui-ers are entitled to the ship herself, salvage ri<^hts of
from her {t), and all the rights of the assured in respect of in«"red.
her {u). But they are not necessarily subject to liabilities
to which the owner was subject in respect of her (j'-). So
they are entitled to any damages that may be recovered
against the wrong-doer in a collision by which the insured
ship is injured or lost (//). And, in the case of a valued
policy, the right of the insurers is the same, although the
value named in the policy is less than the actual value of
the ship (~).
A policy of insiu-ance was effected for 6,000/. upon a
ship which was valued at 6,000/. The ship was sunk in a
{q) Mcreto)iij\. Dmilope, 1 T. E.
260. It appears that insurer/ in
report of 1817 is a misprint for
insurer." see 15 Q. B. 0(34, note.
()•) See loclci/cr v. Oj/!e>/, 1 T. R.
252. If a ship which is insured is
injured in collision and is repaired,
and afterwards becomes a total loss,
the insurers arc liable as well for
the expense of the repairs as for the
loss. But they are not liable for
damage caused by the collision be-
yond the expense actually incurred
in repairing such damage : Ulctvart
V. Sttelr, 5 8cott, N. K. 927.
(.<,) 15 Q. B. 649, 667. See also
Lidgett v. Secretan, L. R. 5 (J. P.
190.
{t) As to what is salvage, see
liuniaiid V. liodocanachi, Q. B.
D. 633 ; 7 App. Cas. 333.
(m) See BarreJl v. Tibbits, 5 Q. B.
D. 500, a case of fire insurance.
(.'â– ) As, for example, the expense
of raising her, if she is an obstruc-
tion in a harbour, under 10 & 11
Vict. c. 27, s. 56; Eglington v. Xor-
mnii, 46 L. J. Ex. 557.
(y) Yates v. lllnjte, 4 Bing. N. C.
272, 283; 5 Scott, 640; White v.
JJobinsoii, 14 Sim. 373 ; Jiaiidal v.
Cochrane, 1 Yes. 98 ; Blaanpot v.
J)a Costa, 1 Eden, 130; Brooks \.
MclJonneU, 1 Y. & C. Ex. 500 ; Mid-
land Insurance Co. v. Smith, 6 Q. B.
D. 561 ; Scaramanga v. Jfiinjiiand,
5 Asp. M. C. 410, 506. As to
what evidence is required of the
right of the insurer to sue in the
name of the insured, see 'The John
Bellamy, L. R. 3 A. & E. 129.
(z) 2\orth of England, ^^-c. Assurance
Association v. Armstrong, L. R. 5
Q. B. 244.
294 COLLISION WITH REFERENCE TO INSURANCE.
collision, and the underwriters paid the owners 6,000/., as
for a total loss. Afterwards, the underwriters, in the name
of the shipowners, instituted a damage suit in the Admi-
ralty Court against the other ship. It was held that the
last-mentioned ship was solely in fault for the collision,
and judgment was given against her owners for 5,683/.
U.S. 7d., the amount of their statutory liability. The true
value of the shijD insured was 9,000/. ; and her owners
claimed so much of the damages recovered in the Admi-
ralty action as would make up the difference between the
sum paid to them by the underwriters and the value of their
ship. It was held that, as between the shipowner and the
underwriters, the value named in the policy was conclusive,
and that the underwriters were entitled to the whole of
the damages, just as they would have been entitled to the
ship if she had been sunk and afterwards recovered {a) .
A vessel being insured by valued policies to the extent
of two-thirds of her valuation, the assured agreed to assign
to the insurers all right to recover damages for any loss
paid for by them, and that the insm-ers should be entitled
to such proj)ortion of the damages recovered as the amount
insured should bear to the valuation in the policies. The