The Ardennes (Owner of Cargo) v. The Ardennes (Owners)

[1950] 2 All ER 517

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(Judgment by: Lord Goddard CJ) Court:

Judge:
Lord Goddard CJ

Hearing date: 27, 28, 29 June, 5 July 1950
Judgment date: 5 July 1950

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Judgment by:
Lord Goddard CJ

The plaintiff is a fruit grower and exporter at Cartagena in Southern Spain. He has for many years done a considerable business with this country, particularly in exporting here mandarines, a fruit more usually known in this country as tangerines. The trade is, eminently, a seasonal one. Generally speaking, the fruit becomes ready for export towards the latter part of November, until when it is, if not unobtainable, scarce in this market. Accordingly, the earlier the shipment, the better the price it is likely to obtain. Another and very important reason for getting the fruit to this country before the last day in November is that, whereas the import duty on this class of goods is 3s 6d a cwt from 1 April to 30 November on 1 December the duty rises to ten per cent ad valorem . The Spanish growers, therefore, have every incentive to secure the arrival of their fruit as early as possible in November, and, at the latest, by 30 November.

The defences raised were, in substance, that there was no oral agreement between the parties that the ship should proceed direct to London, and that liability was excluded by one of the conditions in the bill of lading. I have no hesitation in finding that there was a promise made to the plaintiff's representative that the ship should proceed direct to London and that he shipped in reliance on that promise. I have, therefore, now to consider the defence which arises out of the terms of the bill of lading. This document was in the form known as "received for shipment," and the operative part reads:

"Received for shipment in apparent good order and condition from Basilio A. Cobarro Tornero in and upon the steamship called the Ardennes or upon any other steamship substituted or following with liberty to call any port or ports for the purpose of receiving and delivering coals ... and bound for London ... 3,000 cases of mandarines ... to be delivered ... at London to order ... "

There are then stamped on the bill of lading words in Spanish which, translated read: "Merchandise received on board." It seems to me, therefore, that this was a bill of lading for goods shipped in the Ardennes. The main controversy, however, turned on the clause in the bill of lading which reads:

"The owners are to be at liberty to carry the said goods to their port of destination, by the above or other steamer, or steamers, ship or ships or railway, either belonging to themselves or to other persons, proceeding by any route, and whether directly or indirectly to such port, and in so doing to carry the goods beyond their port of destination, and so tranship or land and store the goods either on shore or afloat and reship and forward the same at the owner's expense but at merchant's risk."

Counsel for the defendants contended that this clause was a complete defence, and that evidence of any other bargain or promise was not admissible. Whether his contention is correct seems to me to be the main question for decision in this case.

It is, I think, well settled that a bill of lading is not, in itself, the contract between the shipowner and the shipper of goods, though it has been said to be excellent evidence of its terms: see Sewell v Burdick, per Lord Bramwell ( 10 App Cas 105 ), and Crooks v Allan [1879] 5 QBD 38 . The contract has come into existence before the bill of lading is signed. The bill of lading is signed by one party only and handed by him to the shipper, usually after the goods have been put on board. No doubt, if the shipper finds that it contains terms with which he is not content or that it does not contain some term for which he has stipulated, he might, if there were time, demand his goods back, but he is not, in my opinion, thereby prevented from giving evidence that there was a contract which was made before the bill of lading was signed, and that it was different from that which is found in the document or contained some additional term. He is not a party to the preparation of the bill of lading, nor does he sign it. It is unnecessary to cite further authority than the two cases which I have already mentioned for the proposition that the bill of lading is not itself the contract, and, therefore, in my opinion, evidence as to the true contract is admissible. Leduc v Ward (1888) 20 QBD 475 , on which counsel for the defendants strongly relied, was a case between shipowners and indorsees of the bill of lading, between whom its terms are conclusive by virtue of the Bills of Lading Act, 1855, s 1, so that no evidence was admissible in that case to contradict or vary its terms. Between those parties the statute makes it the contract.

In this case, moreover, the representation that the ship would sail direct to London would amount to a warranty, for it was in consequence of that representation that the goods were shipped, both parties being fully aware of its high importance in the circumstances. In other words, it was a promise that the shipowner would not avail himself of a liberty which otherwise would have been open to him. Having formed this view, it is unnecessary for me to consider the other matters argued by counsel for the plaintiff, as, eg , whether the liberty clause is not inconsistent with the opening clause of the bill of lading. Nor do I think that there is anything in the point as to waiver, taken in the defence. Whatever the reason may have been, the ship arrived late, ie , later than she would have done had she not gone first to Antwerp. She had the plaintiff's goods on board and they were of a perishable nature. I cannot see that he can be said to have waived his claim for damages because he took delivery and paid the freight rather than let the goods remain to be dealt with in some way by the shipowner, a course which might and, probably, would, have largely increased the damages, as the fruit might then have perished or deteriorated, and this is also true of the 362 cases which arrived later.

This case is, in my opinion, quite distinguishable from The Parana (1877) 2 PD 118 , because all parties must have been aware that the earlier the goods arrived, the better would be the price. The case is much more akin to Dunn v Bucknall Bros, Dunn v Donald Currie & Co [1902] 2 KB 614 .