Court of Session Inner House Second Division – By a time charter-party of a steamer at a certain rate of hire per mouth, which did not amount to a demise of the vessel, it was stipulated that the owners should maintain the vessel in a thoroughly efficient state in hull and machinery for the service, and that the charterers should provide and pay for all the coals required. The charter-party contained an indemnity clause providing ‘that the captain, although appointed by the owner, shall be under the orders and directions of the charterers as regards employment, agency, or other arrangement. Bills of lading are to be signed at any rate of freight the charterers or their agents may direct if without prejudice to this charter . . the charterers hereby indemnify the owners from all consequence or liabilities that may arise from the captain doing so.’ It also contained an exceptions clause, excepting accidents of navigation although occasioned by the negligence of the master.
While under the charter-party the vessel, owing to the negligence of the master, sailed from a foreign port with an insufficient supply of coal, and had in consequence to accept salvage services for which the shipowners were found liable. The vessel at the time of her disablement had on board goods belonging to sub-charterers, for which the master had signed bills of lading containing a similar exception of liability for negligence of the master in navigating his vessel. The sub-charterers having refused to pay any part of the loss, the shipowners brought an action of relief for the part of the salvage expenses, effeiring to cargo, against the time charterers, founding (1) upon the indemnity clause, in respect that their liability arose from the captain having signed bills of lading in obedience to the instructions of the time charterers; and also (2) upon the exceptions clause in the time charter. Held ( diss. Lord Young) that as regards the duty of sailing upon the voyage in a seaworthy condition the master was the servant of the shipowners and not of the charterers, and that the former were consequently liable for the whole loss caused by his neglect of this duty, and were not entitled to relief.
Question- Whether an indemnity clause in such terms imports anything more than a right to relief in the event of bills of lading being signed for a freight or freights which would amount to less than the stipulated hire.
Judges:
Lord Low, Ordinary
Citations:
[1898] SLR 35 – 378
Links:
Jurisdiction:
Scotland
Transport
Updated: 17 April 2022; Ref: scu.612160