A firm of jute merchants contracted to ship a specified number of bales of jute from Calcutta to Buenos Ayres. The contract contained, inter alia, the following provisions:-‘Any delay in shipment caused by fire, strike, breakages, and accidents . . and for any other unforeseen circumstances, to be excepted, and the quantity short produced in consequence thereof to be deducted from the quantity named in this contract, or delivered soon as possible thereafter, buyers having the option of refusing it after time. . . Should the vessel by which freight has been engaged be commandeered or delayed by the Government, sellers shall not be responsible for any late shipment or other consequences arising therefrom, and the goods shall be sent forward as early as possible. . . ‘ It also contained an arbitration clause in the following terms:-‘Any dispute that may arise under this contract to be settled by arbitration in Dundee.’ Before all the bales of jute had been shipped, further export of jute from India to the Argentine was prohibited by an Order in Council of the Governor-General of India. A dispute having arisen between the parties as to whether the contract was rendered void and unenforceable quoad the balance of the bales of jute, the sellers maintained that the arbitration clause was inapplicable on the ground that the dispute as to whether the contract had been ended was not a dispute arising under the contract. Held ( aff. the judgment of the Second Division) that as the dispute which had arisen was a dispute as to the meaning of the contract, viz., whether the contract had specifically provided for the events which had happened, it was a dispute under the contract, and that accordingly it fell to be determined by arbitration.
Judges:
Lord Chancellor, Lord Dunedin, Lord Shaw, Lord Buckmaster, and Lord Carson
Citations:
[1923] UKHL 437, 60 SLR 437
Links:
Jurisdiction:
Scotland
Contract, Arbitration
Updated: 13 June 2022; Ref: scu.633254