Burns Philp & Co Ltd v West Australian Steam Navigation Co Ltd [1923] HCA 55; (1923) 33 CLR 135 (27 November 1923)

HIGH COURT OF AUSTRALIA

Burns Philp & Company Limited Plaintiff, Appellant; and The West Australian Steam Navigation Company Limited and Another Defendants, Respondents.

H C of A

On appeal from the Supreme Court of Western Australia.

27 November 1923

Knox C.J., Gavan Duffy and Starke JJ.

Sir Walter James K.C. and F. Leake, for the appellant.

J. P. Dwyer (with him Thomas), for the respondents.

Sir Walter James K.C., in reply.

The following written judgments were delivered:—

Nov. 27

Knox C.J. and

Starke J.

This is a claim for loss of goods shipped in the port of London for delivery at Fremantle wharf, Western Australia. The goods were shipped on the ss. Kleist, but the bill of lading gave liberty, as regards the whole or any part of the goods and at the risk of the owners before shipment, or at any time during transit, as often as might be deemed expedient, to ship by, or to tranship to, any other vessels. The ss. Kleist was owned by the West Australian Steam Navigation Co. Ltd., but her destination was Singapore, and the parties to the bill of lading knew that she was not intended to go on to Fremantle. The goods were transhipped at Singapore, pursuant to the liberty contained in the bill of lading, on to the ss. Gorgon, owned by the Ocean Steamship Co. Ltd. The agents of the West Australian Steam Navigation Co. Ltd. (Boustead & Co.) at Singapore issued a note to the commanding officer of the ss. Gorgon, requesting him to receive the goods on freight for Fremantle. But those in charge of the ss. Gorgon added to the note the words "On deck at shipper's risk." The goods were wax matches, and this stipulation was usually, and indeed we may say invariably, required in contracts for the carriage of dangerous goods—which include wax matches—between Singapore and Fremantle. And the goods were undoubtedly placed on board the ss. Gorgon subject to this stipulation. A fresh bill of lading was not issued.

There was, so far as the plaintiff is concerned, but one contract of carriage, with one entire consideration for the whole transit from London to Fremantle wharf. It was between the owners of the ss. Kleist on the one hand and R. Bell & Co. Ltd., the consignee, or its assigns, on the other. The bill of lading is the contract which governs the rights of the parties. Now, this contract, in the absence of custom or express stipulation to the contrary, imported a duty on the part of the owners to stow the goods under deck and not on deck (Royal Exchange Shipping Co. v. Dixon & Co.[1]). But it is claimed that this contract does negative any responsibility for the goods being carried on the deck of the ss. Gorgon, or at all events adds to the provisions of the bill any extra conditions or protection imposed by the owners of the ss. Gorgon in the carriage of the goods. The argument is rested upon two clauses in the bill. One provides as follows:—"Transhipment of cargo for ports where the ship does not call, or for shipowners' purposes, to be at shipowners' expense, but at the risk of the owners of the goods from the time goods leave the ship's deck, where ship's responsibility shall cease. ... Goods forwarded by steamship or otherwise for shipment or after transhipment to be subject to the conditions and exceptions of the forwarding conveyance, and at the risk of the owners of the goods." The first limb of this clause applies to risks arising out of the act of transhipment, but it does not further qualify the bill of lading (Stuart v. British &c. Co.[2]). But the second part is the more important, and it must be coupled with another provision, namely, the second of the two clauses above referred to, which provides: "This bill of lading shall constitute the contract between the owners of the goods and the shipowners; it shall be construed and governed by English law, and shall apply throughout the transit but always subject to the conditions and exceptions of the carrying conveyance." The words in these clauses cannot "negative the whole tenor of the bill of lading," "eat up the contract"; but they do assure to the shipowner some benefit or protection in addition to the provisions of his own bill of lading (The Galileo[3]; Stuart v. British &c. Co.[4]), and the question is what is the extent of that additional benefit or protection. It seems to us that the clauses mean that shippers, in the case of transhipment authorized by the bill, shall be bound by all clauses and conditions affecting carriage usually required by the forwarding vessel. (See Hadji Ali Akbar v. Anglo-Arabian &c. Co.[5].) What cases of transhipment, therefore, are contemplated by the clauses under consideration? If these cases do not embrace the full scope of the liberty to tranship, given in the earlier part of the bill of lading, they do at least include all cases in which transhipment is for ports where the ship does not call or for shipowners' purposes. In our opinion, the case before the Court is a case of transhipment for shipowners' purposes, and it is unnecessary, therefore, to consider other possible cases. We have not omitted to notice the provisions for transhipment in cases of impeded loading, carriage and discharge, dealt with in another part of the bill of lading (see Wiles & Co. v. Ocean Steamship Co.,[6]), and, though those cases may be instances of transhipment for shipowners' purposes, still the provisions of the clauses under discussion are not limited to such cases, and there is no apparent reason why they should be so limited.

In the present case, the owners of the ss. Kleist undertook to carry the goods from London to Fremantle, but their ship did not voyage so far, and they took advantage of the clauses enabling them to tranship the goods to another vessel for the purpose of completing the contract. Such a transhipment was for the shipowners' purposes: it was for the purpose of performing on their part the contract of carriage, and for no other purpose. But for the very wide liberty to tranship contained in the bill of lading, the goods must have been brought on to Fremantle in the ss. Kleist. The transhipment of the goods to the ss. Gorgon was therefore authorized by the bill of lading. The forwarding vessel, the ss. Gorgon, imposed its usual condition that the goods be carried on deck. The carriage of the goods is then by force of the bill of lading subject to this condition. They were in fact dangerous goods—wax matches—and were, upon an outbreak of fire on the ss. Gorgon, jettisoned, off the coast of Western Australia, for the safety of the vessel, and thereby lost. The exception in the bill of lading covers the act of jettison, but in any case a shipowner is not answerable for goods stowed on deck pursuant to the stipulations of the contract of carriage, which have been rightly jettisoned in a case of necessity.

Apart from the stipulations of the bill of lading, reliance was placed upon a custom of stowing wax matches on deck between Singapore and Fremantle. The learned trial Judge found this custom proved. It is unnecessary, in the view we take, to pass a final opinion upon the evidence adduced in support of this custom, but, as at present advised, we consider that the evidence falls short of proof of its existence.

The appeal ought to be dismissed.

Gavan Duffy J.

The bill of lading in this case contains a contract not merely to carry the goods from London to Fremantle, but to carry them "under deck" during the whole of the transport (Royal Exchange Shipping Co. v. Dixon & Co.[7]); and I am disposed to think that the condition of carriage on deck sought to be imposed during the transport on the Gorgon is not justified by any provision in the bill of lading, because it is inconsistent with the essence of the contract. However, the Chief Justice and my brother Starke think otherwise, and I am not prepared to dissent from their judgment.

Appeal dismissed with costs.

Solicitors for the appellant, Stone, James & Co.

Solicitors for the respondents, Dwyer, Unmack & Thomas.

[1] (1886) 12 App. Cas., 11.

[2] (1875) 32 L.T. (N.S.), 257.

[3] (1914) P., 9; (1915) A.C., 199.

[4] (1875) 32 L.T. (N.S.), 257.

[5] (1906) 11 Com. Cas., 219.

[6] (1912) 107 L.T., 825.

[7] (1886) 12 App. Cas., 11.