2 K. B .

KING'S BENCH DIVISION.

791

[IN THE COURT OP APPEAL.]

C.A.

TEMPEELEY STEAM SHIPPING COMPANY v. SMYTH & CO.

ShipChartorpartyArbitration ClauseCesser ClauseBill of Lading Incorporation of Terms of CharterpartyClaim for Demurrage at Port of LoadingArbitration Act, 1889 (52 & 53 Vict. c. 49), s. 4. It was provided by clause 39 of a charterparty, by which the plaintiffs' vessel was chartered by the defendants for the carriage of a cargo of wheat from Bahia Blanca to a port in the United Kingdom, that, if the loading of the cargo were delayed by reason of certain causes therein specified, the time so lost should not be counted as part of the lay-days, and that, if any dispute arose under that clause in the loading of the ship, the same should be settled in the Argentine Republic by arbitration in the manner therein mentioned. The charterparty contained the usual cesser clause providing that the charterers' liability should cease upon shipment of the cargo, provided the cargo was worth the bill of lading freight, dead freight, and demurrage at the port of shipment, and that the vessel should have a lien on the cargo for recovery of all such bill of lading freight, dead freight, demurrage, and all other charges whatsoever. A full cargo was shipped by the defendants under the charterparty, and bills of lading were given in respect thereof, by which the cargo was made deliverable to the defendants or their assigns, they paying freight for the said goods, against delivery, in cash, at a rate of freight in accordance with the charterparty. The bills of lading stated that all the terms and exceptions contained in the charterparty were therewith incorporated, and formed part thereof, and gave the shipowners an absolute lien on the cargo for the recovery of freight and demurrage and all other charges whatsoever. There was no dead freight, and the cargo shipped was worth the freight and charges. A dispute within the meaning of clause 39 having arisen with regard to delay in the loading of the ship between the plaintiffs and the defendants after the completion of the loading: Held, that, notwithstanding the cesser clause, and the fact that the defendants were the holders of the bills of lading, the provision for arbitration in clause 39 of the charterparty remained operative as between the plaintiffs and the defendants, and therefore that an action brought by the plaintiffs after the ship's arrival in the United Kingdom, claiming a declaration that they were entitled to a lien on the cargo for demurrage at the port of loading, should be stayed under s. 4 of the Arbitration Act, 1889. Runciman & Co. v. Smyth & Co., (1904) 20 Times L. R, 625, overruled.

^ g . Aug. 7.'

'

APPEAL by the defendants from the refusal of Channell J. to stay the action under s. 4 of the Arbitration Act, 1889.

792 C.A. 1905

KING'S BENCH DIVISION.

[19053

The action was brought by shipowners in the Commercial Court for a declaration that the plaintiffs were entitled to a nen on TEMPEBLEY certain goods discharged from a steamship called the Smppnto Woodbridge, belonging to them, for the sum of 661Z., and for COMPANY payment of that sum, which had been deposited in a bank in SMYTH & Co. joint names to abide the result of proceedings. On January 7, 1905, a charterparty was entered into at Buenos Ayres between the plaintiffs and one F . M. Nicholson, who was acting as agent for the defendants, whereby the Woodbridge was chartered to Nicholson to carry a cargo of wheat from Bahia Blanca to a port in the United Kingdom. By clause 23 of the charterparty the cargo was to be loaded by the charterers at the rate of 200 tons per running day (Sundays and holidays excepted), and time for loading was to commence to count twelve hours after written notice had been given by the master, brokers, or agents to the charterers or their agents that the vessel was in readiness to receive cargo, and all time on demurrage over and above the said laying days was to be paid ' for by the charterers or their agents to the ship at the rate of 4d. per gross register ton per day. By clause 31 it was provided that the master should sign bills of lading as presented at any rate of freight that the charterers or their agents might require, but any difference in amount between the bill of lading freight and the total gross chartered freight should be settled at the port of loading before the steamer sailed, "charterers' liability to cease upon shipment of cargo (provided such cargo be worth the bill of lading freight, dead freight, and demurrage at port of shipment). Vessel to have a lien on cargo for recovery of all such bill of lading freight, dead freight, demurrage, and all other charges whatsoever." Clause 39 was as follows: " If the cargo cannot be loaded by reason of riots or any dispute between masters and men occasioning a strike or lock-out of stevedores, lightermen, tugboat men, cart men, railway employees, or other labour connected with the working, loading, or delivery of the cargo proved to be intended-for 'the steamer, or through obstructions on the railways or in the docks or other loading places beyond the control of charterers, the time lost not to be counted as part of the lay-days (unless

SE.B.

KING'S BENCH DIVISION.

793 ' c. A. 1905

TEMPKRLEY SH^PUJO COMPANY SMYTH

any cargo be actually loaded by the steamer during such time), but lay-days to be extended equivalent to the time lost owing to such cause or causes, and, if the cargo cannot be discharged by reason of a strike or lock-out of any class of workmen essential to the discharge of the cargo, the days for discharging shall not count during the continuance of such strike or lockout. A strike of the charterers' or receivers' men only shall not exonerate charterers or receivers from any demurrage fot which they may be liable under this charter, if by the use of reasonable diligence they could have obtained other suitable labour, at rates current before the strike, and, in case of any delay by reason of the before-mentioned causes, no claims for damages shall be made by charterers or receivers of the cargo,' or by the owners of the ship, or by any other party under this charter. Any time lost by the steamer through any of the above causes to be reckoned as days for loading solely for the purpose of settling the despatch money account. Should any dispute arise under this clause in the loading of the steamer, same to be settled in the Argentine Kepublic by a committee consisting of two arbitrators, one to be nominated by each party to this contract, and should they be unable to agree the decision of an umpire mutually approved by the two arbitrators shall be final." The cargo was shipped at Bahia Blanca, and bills of lading were given which stated that the cargo was shipped by F . M. Nicholson on board the steamship Woodbridge to be delivered, subject to the terms of charterparty or freight contract, unto the defendants or their assigns, " they paying freight for the said goods, against delivery, in cash, without deduction, the rate of freight to be in accordance with charterparty or freight contract effected at Buenos Ayres, dated January 7, 1905, all the terms and exceptions contained in which charterparty or freight contract are herewith incorporated and form part hereof." It was provided by the bills of lading that the owner or master of the vessel should have " an absolute lien and charge upon the cargo and goods laden on board for the recovery and payment of freight and demurrage and all other charges whatsoever."
VOL.

& Co.

II. 1905.

3 H

794 C. A. 1905

KING'S BENCH DIVISION.

[19053

The loading of the vessel at Bahia Blanca occupied a longer time than the lay-days specified by the charterparty. There TEMPEBLEY was no dead freight, and the cargo loaded was worth t h e SHIPPING freight and charges. I t was asserted by the defendants that COMPANY the delay was due to a strike within the meaning of clause 39. SMYTH & Co. of the charterparty, but this was denied by the plaintiffs. When the loading was completed, the captain, on behalf of. the plaintiffs, made a claim for 6611. demurrage alleged t o have been incurred at the port of loading, but the charterers denied that they were liable for demurrage, and proposed t h a t there should be an arbitration upon the dispute in accordance with clause 39 of the charterparty. The master refused to entertain this suggestion and the vessel sailed for Manchester, where she arrived in due course. The plaintiffs claiming a lien upon the cargo for the demurrage, i n order to release the, cargo, the defendants, as before mentioned, paid the sum of 6611. into a bank to a joint account. The plaintiffs having brought this action, the defendants applied under s. 4 of the Arbitration Act, 1889, for a stay in order that the dispute might be referred in accordance with the arbitration clause in the charterparty. On the application coming before Channell J . at chambers he was of opinion that the words " in the loading " in clause 39 of the charterparty meant " during the loading," and on that ground he refused a stay. H e also decided that the case was not one in which, in the exercise of his discretion, he would grant a stay. The defendants appealed. July 25. Pichford, E.G., and Leslie Scott, for the defendants. The matter in dispute in this action comes within the terms of the provision for arbitration contained in clause 39 of the charterparty, which is not confined, as is suggested by the plaintiffs, to a dispute arising in the course of the loading. I n this case the defendants are both charterers and holders of the bill of lading. The contract as between the shipowners and. the charterers must be looked for in the charterparty, and not. in the bill of lading, which does not as between the ship-

2 K. B.

KING'S BENCH DIVISION. O.A. 1905

795

owners and the charterers supersede the charterparty, but only operates as a receipt for the goods: see Bodoconachi v. Milbum (1) and per Lord Bramwell in Wagstaffv. Anderson (2) and Seioell v. Burdick. (3) This is not like a case where the bill of lading has been indorsed by the charterer to an indorsee for value. The case of Hamilton & Co. v. Mackie dt Sons (4) is distinguishable. The dispute in that case arose between the shipowner and the consignee of the goods with regard to bill of lading freight, and the arbitration clause was expressly confined to disputes arising under the charter. The case of Bunciman d Co. v. Smyth & Co. (5), which will be relied on by the plaintiffs, purported to be decided on the authority of Hamilton & Go. v. Mackie d- Sons (4), but the facts of the case did not really bring it within that decision. If there is anything in the decision in Gullischen v. 'Stewart Brothers (6) to the contrary of what was laid down in Bodoconachi v. Milbum (1), the latter case ought to be followed, being later in point of date. If necessary, the defendants will contend that, on the true construction of the bill of lading, it incorporates the provision for arbitration contained in clause 39 of the charterparty. The bill of lading incorporates the terms and exceptions of the charterparty, so far as not inconsistent therewith, and provides that the shipowners shall have an absolute lien on the cargo for demurrage. The right to demurrage and its amount can only be ascertained by looking back to the terms of the charterparty, including clause 39, the strike clause, which provides for arbitration in the event of such .a dispute as has here arisen. There is nothing inconsistent with that provision in the bill of lading. I t may be that the effect of the cesser clause is that any right of the shipowners to demurrage must be enforced by means, of the lien given on the cargo, and not against the charterers personally; but the existence of that lien for demurrage must depend on the terms of the charter(4) (1889) 5 Times L. E. 677. ( (1) (1886) 17 Q. B. D. 316; 18 Q. B. D. 67. (5) 20 Times L. R. 625. (2) (1880) 5 C. P. D. 171. (6) (1884) 13 Q. B. D. 317. (3) (1884)10App.Cas.74,atp.l05. 3 H 2 2

TEMPERLEY
s

|^^0 & Co.

COMPANY SMYTH

796 C.A. 1905

KING'S BENCH DIVISION.

[1905]

party, and the exceptions mentioned in clause 39, which provides the means for determining in certain cases whether TEMHSRLEY demurrage has been incurred; and the bill of lading must be STEAM construed as incorporating the provisions of the charterparty COMPANY for the purpose of determining whether demurrage has been SMYTH'& CO. incurred, and therefore the shipowners have a lien for it. It is not disputed that it is matter of discretion whether the Court will stay the action, and to some extent no doubt it will have regard to the balance of convenience in determining whether it will do so or not. But, as regards any inconveniences which may be occasioned to the plaintiffs by having to proceed to arbitration at the present time in the Argentine Eepublic, it must be remembered that the parties agreed that any dispute of this kind should be settled there, and the plaintiffs have brought these inconveniences upon themselves by refusing to have the matter dealt with at Bahia Blanca before the vessel sailed from there. They ought not to be allowed to escape from their bargain because they have made it inconvenient for themselves to fulfil it. [They also cited Bestitution Steam Ship Co. v. Pirie < Co. (1); Clink v. Badford dc Co. (2)] J. A. Hamilton, K.C., and A. Adair Boche, for the plaintiffs. The defendants have to shew, first, that there is a subsisting contract between them and the plaintiffs to refer this dispute to arbitration; and, secondly, that it is under the circumstances convenient and proper that it should be so referred. To take the question as to convenience first: if there is to be a reference to arbitration at Bahia Blanca, the whole action must in effect be referred, and there is no provision by which the arbitrators are bound to submit any questions of law to the Court, nor any machinery by which they can be compelled to do so. The defendants'case is that the delay in loading was occasioned by a strike. The plaintiffs' contention will be that the loading was not delayed by any cause within the meaning of the exceptions in the charterparty. There had no doubt been a congestion of shipping at the port and the vessel had to wait for her turn to load. There are a number of authorities
(1) (1889) 64 L. T. 491. (2) [1891] 1 Q. B. 625.

2 K. B.

KING'S BENCH DIVISION.

797

and nice questions as to what the law of England is where the C. A. cause of delay in loading is that the vessel cannot get a turn 1905 owing to the congestion of the port. It is not satisfactory that TEMPERLEY such a question of English law should be determined by lay s ^pp* G arbitrators at Bahia Blanca. It appears, according to the COMPANY defendants' contention, that it may be a nice question of law SMYTH & do. whether under the circumstances the plaintiffs have obtained a lien on the cargo. Then, is there any agreement subsisting between the plaintiffs and the defendants to refer this dispute to arbitration? The charterers' liability ceased under the cesser clause when the ship had loaded a full cargo which would cover the bill of lading freight and other charges. That being so, the plaintiffs have no remedy against the defendants personally on the charterparty, but only by way of lien under the bill of lading. It is submitted that the provision for arbitration in the charterparty is not incorporated by the bill of lading. Gullischen v. Stewart Brothers (1) is an authority in the plaintiffs' favour. That case has never been doubted, and is, it is submitted, good law. The decision there was to the effect that, where the charterparty contained a cesser clause, and the charterers were named in the bill of lading as consignees of the cargo, the liability under the charterparty ceased by virtue of the cesser clause, and the bill of lading became the operative instrument between the parties, but, inasmuch as it incorporated the provisions of the charterparty as regards demurrage at the port of discharge, it could not be read as incorporating the cesser clause as regards the liability of the consignees upon the bill of lading for that demurrage. The charterparty contract ceased in this case by virtue of the cesser clause as soon as the ship was loaded, and the bill of lading cannot be construed as incorporating the provision for arbitration contained in clause 39 of the charterparty, that clause not being consistent with the terms of the bill of lading. To say that the charterparty must be referred to, in order to see what the liabilities as to freight, demurrage, &c, under the bill of lading are, is quite different from saying that a provision in the charterparty as to arbitration (1) 13 Q. B. D..317.

798 C. A. 1905

KING'S BENCH DIVISION.

[1905]

must be incorporated. The cases, such as Serraino v. Campbell (1) shew that the principle is that the provisions of the TEMPEELEY charterparty must be treated as incorporated only so far as tlie SHIPPING y r e l a t e to what has to be done under the bill of lading. COMPANY Bodoconachi v. Milburn (2) cannot be treated as overruling SMYTH & Co. Gullischen v. Stewart Brothers. (3) I n Bodoconachi v. Milburn (2) the jury had been asked whether the charterers had agreed to accept the bills of lading as mere receipts for the cargo, and they had answered that question in the affirmative. The decision must, it is submitted, be read in the light of that finding. The decision in Bunciman d Co. v. Smyth d Co. (4) is directly in the plaintiffs' favour. I t is very difficult to reconcile the view taken in Bodoconachi v. Milburn (2) with what was held in Hamilton d Co. v. Mackie d Sons (5), which is really undistinguishable from the present case. I t is not easy to work out the dicta in Bodoconachi v. Milburn (2) and Sewell v. Burdick (6), upon which the defendants rely. How can the bill of lading only be a receipt in the hands of a charterer, but become a substantive contract in the hands of an indorsee of the bill of lading ? [They cited on this point Turner v. Haji Goolam Mohamed Azam. (7)] I t is further submitted that Channell J . was right in holding that the provision for arbitration in clause 39 of the charterparty. does not apply to the case of a dispute arising after the completion of the loading and departure of the ship from the port of loading, but to disputes about incidental questions arising from time to time in the course of the loading, as to the manner of loading to be adopted and such like matters, e.g., as to whether the ship is to take in cargo at more than two hatchways at a time. Pick/ord, K.C., in reply. No question of English law will arise on the arbitration. I t is not disputed by the defendants that, if the delay in loading did not arise from one of the causes
(1) (1890) 25 Q. B. D. 501; [1891] (3) 13 Q. B. D. 317. 1 Q. B. 283. (4) 20 Times L. E. 625. (2) 17 Q. B. D. 316; 18 Q. B. D. (5) 5 Times L. B. 677. 67. (6) 10 App. Cas. 74, at p. 105. (7) [1904] A. C. 826.

2 K. B.

KING'S BENCH DIVISION.

799

excepted by the charterparty, the demurrage was incurred, and c. A. the plaintiffs had a lien for it. The only question which will 1905 be raised before the arbitrators will be whether the delay in x E M P E R L E Y fact arose from one of the excepted causes. STEAM
r

SHIPPING COMPANY

Cur. adv. vitlt. Aug. 7. COLLINS M.E. read the following judgment:This is an appeal from Channell J., who refused to stay proceedings with a view to a reference under s. 4 of the. Arbitration Act, 1889. The plaintiffs are the owners of the steamship Woodbridge, and have brought this action for a declaration that they are entitled to a lien to the amount of 661Z. on a cargo carried in the said steamship from Bahia Blanca to Manchester under a charterparty. The defendants, who are the charterers and also holders of the bill of lading/, dispute the plaintiffs' right to the amount claimed, but have paid it into a bank in the joint names of the parties so as to release the cargo. The lien. claimed is for demurrage at the port of loading. The defendants contend that the question whether any such demurrage is payable or not depends on clause 39 of the charterparty, which provides that, should any dispute arise under that clause in the loading of the steamship, it shall be settled by arbitration; arid they accordingly apply under s. 4 of the Arbitration Act, 1889, to have the dispute referred to arbitration as provided by the clause. The plaintiffs contend that, as a matter of construction, the clause does not cover the dispute in this case, and Channell J. has accepted that view. They also contend that, having regard to the cesser clause in the charterparty and to the fact that the defendants, although charterers, are holders of the bill of lading, the arbitration clause, even if applicable to the facts, cannot be invoked. The main argument before us has been on the latter point. The charterparty purports to be made between the plaintiffs and ]?. M. Nicholson as charterer. Nicholson was, in fact, the agent for the defendants. The cesser clause (clause 31) is as follows : [The Master of the Eolls read the clause.] Clause 23 . provides for the rate of loading. That clause and clause 39iare as

SMYTH'& CO.

800 c. A. 1905

KING'S BENCH DIVISION.

. [1905]

follows: [The learned judge read those clauses, and continued: ] First, with regard to the construction of clause 39 itself: I TEMPEKLBT- cannot agree with Channell J. that it relates only to a dispute na m u s SHIPPING * * * a " s e fr- settlement before the loading is complete. C M A Y It seems to me that the dispute arises " in the loading " within O PN
V.
t

& Co. the meaning of the clause if the loading is claimed by one * coiHns M.n. party and denied by the other to have been delayed by one of the causes named in the clause, and none the less because the extent of the delay cannot be ascertained until the loading has been completed. With regard to the point that clause 39 cannot apply by reason of the cesser clause and the fact that the charterers are also the holders of the bill of lading, if the case were free from authority, I cannot think that there would be any difficulty. A dispute has arisen between two parties to a contract by which they have agreed that in an event which has happened there shall be an arbitration. Why is the arbitration not to take place ? The fact that the liability of the charterers is to cease on shipment of the cargo cannot affect the matter because the clause is quite independent of whether personal liability subsists or not. It is common ground that a lien subsists if anything is due, and the only question is for what amount. Why is the amount not to be ascertained in the manner provided by the contract ? The cesser clause itself cannot bring about this result, and, if it can be reached at all, it must be because of the bill of lading. But the bill of lading in terms provides that " all the terms and exceptions contained in the charterparty or freight contract are herewith incorporated and form part hereof," and further " the owner or master of. the vessel shall have an absolute lien and charge upon the cargo . . . . for the recovery and payment of freight and demurrage and all other charges whatsoever." I can see nothing at all inconsistent in the provision of the charterparty that the amount of demurrage at the port of loading is to be ascertained by arbitration at the.port of loading, and the provision in the bill of lading that there is to be a lien for the amount, so as to prevent the former provision from operating- between the parties to the charterparty, who are also the parties to the
SMYTH

2 K. B.

KING'S BENCH DIVISION.

801

bill of lading. Apart from authority, I think this would be c. A. clear. 1905 I t is, however, necessary to examine the authorities, and the .TEMFEBLEY respondents can certainly vouch one in their favour, which does . g|^*G not seem to be distinguishablenamely, Runciman & Co. v. COMPANY Smyth d- Co. (1) That case, however, purported to be decided SMYTH & Co. on the authority of Hamilton d Co. v. Mackie dc Sons. (2) This coin M.R. latter case was an action by the shipowner against the indorsee of the bill of lading who was not the charterer, and was .for bill of lading freight. The case is very shortly reported, and I.will read the judgment of Lord E s h e r : " The law on the subject had been laid down several times. "Where there was in a bill of lading such a condition as this, ' all other conditions as per charterparty,' it had been decided that the conditions of the charterparty must be read verbatim into the bill of lading as though they were there printed in extenso. Then if it was found that any of the conditions of the charterparty on being so readwere inconsistent with the bill of lading, they were insensible and must be disregarded. The bill of lading referred to the charterparty, and therefore, when the condition was read in, ' all disputes under this charter shall be referred to arbitration,' it was clear that that condition did not refer to disputes under the bill of lading, but to disputes arising under the charterparty. The condition, therefore, was insensible, and had no application to the present dispute which arose under the bill of lading." H e treats the dispute in that case as arising exclusively under the bill of lading, and not under the charterparty, .and therefore as not covered by the clause which related to disputes under the charter only. Here the dispute arises under the charterparty and is between the parties to it, and, unless as between these parties the bill of lading has annulled this part of the contract of the charterparty, it still subsists and binds the parties. There is no doubt that, where the charterer takes the bill of lading in his own name, the rights and obligations as between him and the shipowner are different from those of a person other than the charterer who has become the holder of a bill of lading purporting to incorporate the charterparty,
(1) 20 Times L. B, 625, . (2) 5 Times L. B. 677.

802 0. A. 1905

KING'S BENCH DIVISION.

[1905]

though the precise extent of the difference is not quite clear.. I n Rodoconachi v. Milium (1), decided in 1886, Lord Esher M . E . TEMPEBLEV" says: " In my opinion, even so, unless there be an express proSmrHNG Y^on m * n e documents to the contrary, the proper construction COMPANY 0 f the two documents taken together is that as between the SMYTH & Co. shipowner and the charterer the bill of lading, although mconcoiiira M.R. sistent with certain parts of the charter, is to be taken only as an acknowledgment of the receipt of the goods " ; and he adopts fully what was said by Lord Bramwell in Sewell v. Burdick. (2) On the other hand* in Gullischen v. Stewart Brothers (3), decided in 1884 in the Court of Appeal consisting of Lord Coleridge C.J., Brett M.E., and Bowen L . J . , it was held that a charterer who was also the bill of lading holder could not set up the cesser clause in the charter as an answer to a claim for demurrage at the port of discharge. The broad distinction between the position of a charterer, who ships and takes a bill of lading, and an ordinary holder of a bill of lading is, I think, that in the former case there is the underlying contract of the charterparty which remains until it is cancelled, and taking a bill of lading does not cancel it in whole or in part unless it can be inferred from the inconsistency of the terms of the two documents that it was intended to do so. On the other hand, in the case of the holder of the bill of lading who is not the charterer there is no presumption that he contracts in any terms but those of the bill of lading, and, if the bill of lading purports to import the charterparty, the presumption is that it incorporates only those clauses which relate to the conditions to be performed by the receiver of the goods: Russell v. Niemann. (4) W i t h all deference to the learned judges who decided it, I think Runciman & Co. v. Smyth & Co. (5) is not supported by the authority relied upon, and is not in accordance with principle. If the clause is operative, as I think it is, between the parties, I think the fact that the ship sailed away from Bahia Blanca without performing its conditions, though pressed to do so,
(1) 18 Q. B. D. 67, at p. 75. (3) 13 Q. B. D. 317. (2) 10 App. Cas. 74, at p. 105. (4) (1864) 17 C. B. (N.S.) 163. (5) Times 20 L. R. 625.

2 K. B.

KING'S BENCH DIVISION.

803

debars the owners from relying upon the inconvenience of con- C. A. ducting the reference in the Argentine Eepublic now. I am of 1905 opinion, therefore, that the appeal should be allowed. TEMPEBLEY
. STEAM SHIPPING

L.J. I am of the same opinion, and I desire to add only a few words. If, in order to dispose of the matter by arbitration, it would be necessary for the arbitrators to decide doubtful questions of English law, I should have been of opinion that we ought not to interfere, or to withdraw those questions of law from the Commercial Court. It seems, however, clear to me that upon the facts no such questions will arise before the arbitrators, and we have the undertaking of defendants' counsel that such questions will not be raised before them. I do not think that it would be proper to remit to a tribunal of arbitrators at Bahia Blanca questions of English law, which they would not be competent to decide, such as the questions, under what circumstances a bill of lading supersedes a charterparty, and whether there is an incorporation of terms of a charterparty in a bill of lading, and, if so, whether it incorporates more than the terms relating to the discharge of the cargo, questions as to which the law cannot be said to be altogether clear. But, the suggestion that such doubtful questions as these would have to be submitted to the arbitrators having been disposed of, the case appears to me to be clear. There seems to be no question as to the construction of the charterparty. It contains the ordinary cesser clause, which substitutes a lien for demurrage for the personal contract of the charterers; and it also contains clause 39, which has been read; by the Master of the Eolls, and which was no doubt inserted by the parties with knowledge of a disturbed state of affairs at the port of loading. The ship arrived at the port of loading, and was detained there; and a dispute then arose whether that detention was by reason of one of the matters excepted by clause 39 of the charterparty or by reason of default on the part of the charterers. It seems to me clear that this dispute ought to have been settled at Bahia Blanca as provided by the terms of clause 39 of the charterparty, but the master determined to break the contract in that respect,
MATHEW

C MA Y O PN SMYTH

& Go.

804 C.A. 1905

KING'S BENCH DIVISION.

[1905]

and absolutely refused to proceed to arbitration. On that ground I do not think that the judgment of Channell J. can be TEMPEBLEY supported. He appears to have thought that the charterers SmpriNo w e r e deprived of the benefit of clause 39, because they did not C M A Y take the necessary steps to get the dispute referred at Bahia O PN SMYTH & Co. Blanca before the ship sailed; but the master would not M t e L.J. submit to any discussion of the matter, and at once sailed with hw the cargo. When the ship arrived at her port of destination the shipowners set up a claim for demurrage, and said they had nothing to do with the provision for arbitration; and the amount in dispute has been deposited in a bank in joint names pending settlement of the question. It was clearly intimated to the shipowners by the defendants that, if they brought an action, an application would be made to stay the action with a view to the matter in dispute being referred to arbitration in accordance with the terms of the charterparty. The shipowners nevertheless commenced an action in the Commercial Court. Thereupon an application to stay the proceedings was made, and we have to say whether it should be granted. I have come to the conclusion that it ought to be granted. I pass by the question of law which has been fully discussed by the Master of the Eolls, and come to the question of convenience. It has been urged on behalf of the shipowners that it would be very inconvenient that the matter should be referred to arbitration at Bahia Blanca after this lapse of time, when the voyage is over, and the captain and crew of the vessel have been dispersed. I am not clear that the captain or any of the crew would be a necessary witness in the arbitration, and in any case, if there is any inconvenience occasioned to the shipowners ' in this respect, it is their fault and theirs only. Looking at the case from the point of view of the charterers, and endeavouring to see on which side the balance of convenience lies, it must be observed on the other hand that, if the action proceeded in the Commercial Court, it would be necessary for the charterers to bring witnesses from Bahia Blanca, or obtain a commission to examine them there, which must involve serious delay and expense; and I decline to impose on the charterers a burden such as this, against which they have protected themselves by

2 K. B.

KING'S BENCH DIVISION.

805

the express terms of the charterparty. For these reasons I c. A. think that the action should be stayed, and that, only questions loos of fact appearing to be involved, those questions ought to be TEMPERLEY disposed of by arbitrators in the Argentine Eepublic. I think s ^ p ^ 6 the appeal should be allowed, and, subject to the approval of COMPANY the Master of the Bolls, I think that the arbitrators should SMYTH'&CO. be directed by our order to deal with questions of fact only,
Matkew L.J.

and make their award thereon, and that the award, when made, should be brought before the Commercial Court, that the stay of proceedings should continue until the award is so brought before that Court or further order, and that the costs of the action and reference should be dealt with by the Commercial Court. (1) Appeal allowed. Solicitors for plaintiffs: Botterell dc Boche. Solicitors for defendants: Field, Roscoe dt Co., for Warr dc Wimshurst, Liverpool. Batesons,
E. L.

[IN THE COURT OF APPEAL.]

C. A.
r

SCAKBOEOUGH AND WIFE v. COSGEOVE.

NegligenceBoarding-house KeeperGoods of QuestTheft by Inmate. The plaintiffs became boarders in a boarding-house kept by the defendant. They informed the defendant's manager that they had property which they wished to keep under lock and key, and asked for a key of their bedroom door. They were told by the manager that a second key could not be supplied, that they must not remove the key from the lock, as it was required for the purpose of giving the servants access to the room, and that the room would be quite safe as the people in the house were all known. On a subsequent occasion the plaintiffs again became boarders in the defendant's boarding-house, and occupied the same bedroom, in which a chest of drawers had in the meantime been placed. They asked the manager for a key of the chest of drawers, but none was supplied. The female plaintiff having left some jewellery in a locked handbag in one of the drawers, it was stolen by another inmate of the house, who had been admitted as a boarder without references, or introduction, (1) The order ultimately made by the Court embodied these terms.

^'

July 29, 31 ;