House of Lords - Whistler International Limited v. Kawasaki Kisen Kaisha Limited On 7 December 2000

Please note that this file does not form part of the House of Lords site. The paragraph numbers may change. For Tables of Paragraph Numbers and Cases Cited please click here. To get rid of the Tables please click here. (The frames containing the Tables can be scrolled and resized.)

Judgments - Whistler International Limited v. Kawasaki Kisen Kaisha Limited On 7 December 2000

(back to preceding text)

59.

Similarly, in the case The Renée Hyaffil, 32 TLR 83 (Evans P), 42 TLR 660 CA, the vessel was supposed to be performing a winter voyage from the east coast of Spain to London laden with a cargo of fruit but the master did not wish to brave the weather in the Bay of Biscay even though it was no worse than might be expected for that time of year. He put into La Corunna and stayed there for 23 days. When sued, the owners sought to rely upon the exception neglect in the navigation or management of the vessel. This defence failed both before the judge and in the Court of Appeal. "That delay had nothing to do with the navigation or management of the ship as such." (per Swinfen Eady LJ, at p.660)

60.

The The Renée Hyaffil was cited in Lord v Newsum [1920] 1 KB 846 which was relied upon by the charterers but criticised by the courts below as being inconsistent with Carmichael v Liverpool Sailing Ship Owners Mutual Indemnity Association (1887) 19 QBD 242. In Lord v Newsum, the vessel was under a six month time charter made in 1916. She was ordered on a laden voyage to Archangel but had to abandon the voyage because the master chose to proceed by a route close to the coast of Norway and was held up by the presence of German submarines. If he had proceeded by a route further from the coast, as prescribed by the British Admiralty and by the Norwegian war risk insurers, she would have been able to complete the voyage. The owners were held liable under the 'utmost dispatch' clause. The 'navigation and management' clause was held to provide no defence. Bailhache J said, at p. 849:

61.

The decision was no doubt correct but the reasoning is certainly confusing. The character of the decision cannot be determined by where the decision is made. A master, whilst his vessel is still at the berth, may, on the one hand, decide whether he needs the assistance of a tug to execute a manoeuvre while leaving or whether the vessel's draft will permit safe departure on a certain state of the tide and, on the other hand, what ocean route is consistent with his owners' obligation to execute the coming voyage with the utmost dispatch. The former come within the exception; the latter does not. Where the decision is made does not alter either conclusion.

62.

My Lords, what I have said has the support of Staughton J in The Erechthion [1987] 2 Lloyd's Rep.180 at p.185 where he distinguished between an order to proceed to a particular anchorage and lighten - 'employment' - and taking the advice of the pilot as to where in that anchorage to drop the anchor - 'navigation'. The owners have relied upon various insurance cases giving a broad interpretation to the use of the word 'navigation' in policies and other insurance contracts. These cases did not assist in the present case which is concerned with the use of the term in an exception clause in contracts of carriage and the amended Hague Rules and its interrelationship with the use of the word 'employment'.

63.

The meaning of any language is affected by its context. This is true of the words 'employment' in a time charter and of the exception for negligence in the 'navigation' of the ship in a charterparty or contract of carriage. They reflect different aspects of the operation of the vessel. 'Employment' embraces the economic aspect - the exploitation of the earning potential of the vessel. 'Navigation' embraces matters of seamanship. Mr Donald Davies in the article I have referred to suggests that the words 'strategy' and 'tactics' give a useful indication. What is clear is that to use the word 'navigation' in this context as if it includes everything which involves the vessel proceeding through the water is both mistaken and unhelpful. As Lord Sumner pointed out, where seamanship is in question, choices as to the speed or steering of the vessel are matters of navigation, as will be the exercise of laying off a course on a chart. But it is erroneous to reason, as did Clarke J, from the fact that the master must choose how much of a safety margin he should leave between his course and a hazard or how and at what speed to proceed up a hazardous channel to the conclusion that all questions of what route to follow are questions of navigation.

64.

The master remains responsible for the safety of the vessel, her crew and cargo. If an order is given compliance with which exposes the vessel to a risk which the owners have not agreed to bear, the master is entitled to refuse to obey it: indeed, as the safe port cases show, in extreme situations the master is under an obligation not to obey the order. The charterers' submissions in the present case and the arbitrator's Reasons and decision did not contravert this.

65.

In the present case, the exception did not provide a defence. First, the breach of contract was the breach of both aspects of the owners' obligations under clause 8 of the time charter - to prosecute the voyage with the utmost dispatch and to comply with the orders and directions of the charterers as regards the employment of the vessel. As a matter of construction, the exception does not apply to the choice not to perform these obligations: Knutsford Steamship Co. v Tillmanns & Co. [1908] AC 406; Suzuki v Beynon (sup). In the words of Lord Loreburn LC at [1908] AC p.408: the master "simply broke his contract, interpreting it erroneously". In the same case, at p.410, Lord Dunedin said, referring to the exception of error of judgment in navigating the ship or otherwise: "It seems to me fantastic to extend it to the idea of a captain forming a wrong legal opinion on the meaning of a clause in the bill of lading and then proceeding to act upon it." (See to the same effect Kennedy LJ in the Court of Appeal at [1908] 2 KB 406-7.) Secondly, any error which the master made in this connection was not an error in the navigation or management of the vessel; it did not concern any matter of seamanship. Thirdly, the owners failed to discharge the burden of proof which lay upon them to bring themselves within the exception. This was clearest with regard to the second of the two relevant voyages where the arbitrators could only guess at, "suspect", why it was that the master acted as he did.

66.

My Lords, the courts below were wrong to set aside the award of the arbitrators. Their award was not erroneous in point of law. The interpretation which they placed upon the utmost dispatch and employment clause was one which was open to them and it was likewise right for them, on the view they took of the state of the evidence, to conclude that the defence was not made out. The arbitrators' role in deciding a dispute of this kind draws upon their experience of the shipping industry and the problems it gives rise to. Their description of the commercial character of the bargain struck in a time charter echoed that of Lord Mustill already quoted and is the same as that which I have attempted to explain. They stressed that if the owners wished to rely upon the navigation defence they must explain their position and justify what they had done. In so far as the arbitrators did have any explanation from the master, they rejected it as not providing any justification for not proceeding by the shorter northern route, the great circle route. The evidence of the recommendations of Ocean Routes was uncontradicted.