Scottish Court of Session Decisions

This was an action brought in the Sheriff Court of Edinburgh by the Mossgiel Steamship Company, Limited, owners of the steamship “Burriana” of Glasgow, against the Della Casa Granite Quarries of Italy, Limited, Edinburgh, in which the pursuers craved decree for £34, 5s., being a balance still due and resting-owing of the freight and charges upon 368 pieces of granite carried by them in the “Burriana” from Genoa to Glasgow.

The material part of the bill of lading for the granite was as follows:—“Shipped in apparent good order and condition, by Arecco & Co., in and upon the British Steamer ‘Burriana,’ now lying in the port of Genoa, being marked and numbered or described as per margin, and to be conveyed to and delivered from the steamer's deck (where steamer's responsibility ceases) at the Port of Leith, or so near thereunto as the steamer may safely get, without having to wait or be detained, unto W. W. Gunn, or to his or their agents. The freight, primage, and other charges if any, as stated in the margin, to be paid by shippers in exchange for bill of lading or delivery order, and are due, if paid by shippers, goods, or vessel lost or not lost, on signing of the bills of lading. If payable by consignees, on arrival of the goods at port of discharge.” “Weight to be verified at Glasgow, and additional freight at 15s. per ton to be paid by receivers on any excess on bill of lading weight.” On the margin of the bill of lading there was written in red ink, “Charges for collection at Leith £141, 8s. 9d.”

The port of delivery was changed by arrangement from Leith to Glasgow.

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When the “Burriana” arrived, the bill of lading was not forthcoming, but it was arranged that the pursuers should give delivery of the granite to the defenders against an indemnity clearing the pursuers from all responsibility for doing so, and also from any responsibility regarding disbursements. This arrangement was embodied in letters between the parties, dated respectively 15th and 16th February 1897, and in terms thereof the defenders' manager, W. W. Gunn, took delivery of the granite at Glasgow. When the granite was reweighed, it was found that the defenders were entitled to a reduction of £9, 3s. 9d., which made the sum claimed by the pursuers £132, 5s. instead of £141, 8s. 9d. as entered on the margin of the bill of lading.

The defenders paid the pursuers £98, being freight on the granite delivered at the rate of 12s. 6d. per ton, but they refused to pay the balance of the amount claimed by the pursuers, being the sum sued for.

The pursuers averred that the freight and charges on said 368 pieces of granite were payable by the consignees, all as per bill of lading, and that the defenders were consignees of the cargo, and the said W. W. Gunn, who is their agent, took delivery thereof on their behalf.

The defence was to the effect that the pursuers had contracted with the defenders at Genoa to carry the granite in question at a freight of 12s. 6d. per ton, that freight at this rate had been paid upon the granite delivered, that the balance sued for consisted of charges by Messrs Arecco & Company, the shippers, in connection with the shipment of the granite, for which the defenders denied all liability, and that although their manager had undertaken to relieve the pursuers from responsibility to Arecco & Company for charges made by them beyond the said freight, the pursuers had not been yet found liable therefor.

The defenders also subsequently put in a minute stating that Arecco & Company's account for the shipment of the goods was overcharged in certain respects specified.

The pursuers put in a minute in answer to the effect that they knew nothing of the charges, and had no concern with how they were made up.

In implement of an order made by the Sheriff, the pursuers subsequently stated that the sum sued for was entirely for charges incurred on the cargo before the shipment of the goods at Genoa, but that they did not know what those charges were for; and that they were personally liable to Arecco & Company, the shippers of the cargo, who were also the defenders' agents, in payment of the sum sued for.

The pursuers pleaded—(1) The defenders being due and resting-owing to the pursuers in the sum sued for, decree should be granted as craved. (2) The defences are irrelevant.

The defenders pleaded—(1) The defenders not being due and resting-owing the sum sued for, decree of absolvitor should be pronounced with expenses.

After sundry procedure the parties lodged a joint minute whereby the agents of the parties concurred in admitting that the words and figures “Charges for collection at Leith, £141, 8s. 9d., were written on the margin of the bill of lading by the pursuers' agent at Genoa when it was issued on 26th January 1897, on the instructions of the shippers, Messrs Arecco & Company, and they concurred in renouncing further probation.

On 1st November 1898 the Sheriff-Substitute ( Maconochie) issued the following interlocutor:—“ Finds that the pursuers have not stated any relevant averment of a debt due and resting-owing to them by the defenders: Therefore sustains the defences, dismisses the action, and defences. Finds the pursuers liable to the defenders in expenses, and remits” &c.

Note—“The parties have now lodged a joint minute in which they concur in stating that the words in red ink on the margin of the bill of lading, viz.—‘Charges for collection at Leith, £141, 8s. 9d.,’ were written at Genoa, where the bill of lading was issued, on 26th January 1897, by the pursuers' agent on the instructions of the shippers Messrs Arecco & Company, and they renounce further probation under the Sheriff's interlocutor of 25th August 1898. The freight of the goods, amounting to £98, has been paid by the defenders, and the question comes to be whether the defenders are bound at once to pay to the pursuers, the Shipping Company, the balance (under certain deductions) of the £141, 8s. 9d., set forth on the margin of the bill of lading. The balance is made up of charges for bringing the cargo to the ship, charged by Messrs Arecco & Company. The pursuers have, it will be noticed, accepted payment of the freight from the defenders, and the lump sum on the bill of lading has thus been broken up with their consent into its component parts. The document was signed at Genoa by the pursuers' agent without consultation with the defenders, and when the ship arrived at Glasgow (which had by arrangement come to be the port of discharge) the bill of lading was not forthcoming. The pursuers, however, by letter, No. 16 of process, agreed to give delivery of the goods ‘against an indemnity letter clearing us from all responsibility regarding disbursements.’ This arrangement was confirmed by letter from the defenders, No. 17 of process, and the goods were delivered. When the note of Arecco & Company's charges became known to the defenders they objected to certain items therein, but the pursuers take up the position that that is no affair of theirs, but is a question between the defenders and Arecco & Company, and that they are entitled to payment, in the first place, of the amount noted in red ink on the margin, under the deductions referred to. I do not think that the pursuers have relevantly set forth a debt due to them by the defenders, though they will be entitled to relief from the defenders of any sum which they are bound to pay and do pay to Arecco & Company under the arrangement above set forth. The contract was in its inception

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one between Arecco & Company and the pursuers, and the latter are primarily liable under it; the consignees at the date of the contract did not know anything of its terms, and they did not accept the goods under the bill of lading, which had not come to hand when delivery was given. No doubt the Shipping Company might have retained their goods under their lien, but they did not choose to take that course, and I do not think that the words of the bill of lading import any mandate assigning Messrs Arecco's claim for disbursements to the pursuers. The words of the bill of lading do not seem to me to assist the pursuers in any way. The lump sum on the margin has, as I have said, been divided up into its component parts, and the printed words, ‘freight, primage, and other charges,’ &c., in my opinion, looking to the whole clause, refer to ‘other charges’ of the same nature as ‘freight and primage,’ and there seem to be no other charges of that kind payable to the ship by the consignees. On these grounds, I think that, primarily, the debt averred is a debt due by the pursuers to Arecco & Company. It is admitted by the pursuers that they have paid nothing to Messrs Arecco & Company in respect of their charges, and it is further admitted by the defenders that they are bound by their undertaking of relief to relieve the pursuers of all charges which they are legally bound to pay, and do pay, to Arecco & Company, but this action is not laid upon the guarantee, and I do not think that it has yet come into force. The whole case resolves itself into this—Who is to settle with Arecco & Company whether certain items in their account are overcharged or not? The whole matter will probably be a very small one, from a pecuniary point of view, but in my opinion the duty of meeting Arecco & Company falls upon the pursuers.”

While the case was pending the receiver on the estates of Messrs Arecco & Company, who had become bankrupt, sued the present pursuers in Italy for the sum which was sued for in the present action, and the pursuers, after giving intimation of the action to the defenders, and being advised by their Italian lawyer that they had no defence, paid the amount of the claim made. Their intention to do so was announced to the defenders by a letter dated 18th November 1898.

The pursuers appealed to the Court of Session, and argued—The pursuers were bound to pay Arecco & Company, because they had parted with the goods, and they had no answer to their claim, but under the indemnity the defenders were bound to reimburse the pursuers what they had to pay to Areccos. The pursuers need not have delivered the cargo except upon payment of the whole sum mentioned on the margin of the bill of lading subject to the admitted reduction, and they ought not to be now put in a worse position because they had given delivery without demanding production of the bill of lading, especially in view of the fact that they had done so to oblige the defenders, whose bill of lading was not forthcoming.

Argued for the defenders—This action could only be sustained upon contract. That contract must be either the arrangement made in Glasgow or the contract embodied in the bill of lading. As to the arrangement made in Glasgow, the defenders were not bound to pay anything except what the pursuers were bound to pay to Areccos. No reason was alleged for the pursuers being liable to Areccos. As to the bill of lading, the charges now sued for were due to the shippers and not to the ship, and it was not legitimate to use a bill of lading for the collection of anything except what was due to the ship. The defenders were no parties to the insertion of the entry in the margin of the bill of lading, and could not be bound by it. The defenders were only liable for what was payable by the consignees, and these charges now sued for were not payable by the consignees. Further, they were only liable for other charges ejusdem generis with freight and primage, and these charges made by the shippers were not of that kind.