74. Wehner and Others v Dene Steam Shipping Company and Others (The “Ferndene”) [1905] 2 KB 92

Bills of lading – relationship between time charterparty and bill of lading – parties to the bill of lading

The facts

The vessel under a time charter was sub-chartered under a voyage charter.

The vessel moved a shipment of phosphate from New York to Hamburg under a bill of lading signed by the master.

On arrival in Hamburg, the consignee of the shipment paid a sum of freight to the ship’s agent appointed by the voyage charterer. Discharge of the cargo was completed about one week later.

At this point, the owner sought to exercise its lien for unpaid hire over both the cargo, which had not yet been discharged, and the freight paid by the consignee.

In proceedings instituted in Germany, the owner was unsuccessful in asserting its right to retain the cargo on the basis that payment to the ship’s agent was held to entitle the consignee to possession of cargo.

In further proceedings in Germany, the owner was successful in obtaining payment of the sum of freight which had been paid by the consignee to the ship’s agent.

In English proceedings the voyage charterer sought to reclaim the freight from the owner.

Findings

Channell J held that the bill of lading in this case was a contract between the owner and the voyage charterer/shipper. As authority for this proposition he referred to Gilkison v Middleton.

The court gave judgement for that portion of the hire (together with two small incidental amounts) which was due to the owners at the time of payment of freight under the voyage charter.

The court held that a further installment which was to be paid in advance and which became due on the day which the cargo was finally discharged, was not subject to the lien. The main reason for this was that the vessel had been withdrawn from the charter and the owner was not entitled to hire which had not yet been earned.

Commentary

Hamilton, Roche and Carver were involved as counsel.

The finding that the bill of lading contract is, in the ordinary course, between the ship owner and the shipper, follows the lead given in the Privy Council in Turner v Haji Goolam Mohamed Azam.

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