323. Central Argentine Railway, Ltd v Marwood (the “Goathland”) [1915] A.C. 981

Demurrage – strike clause – partial disruption of work – owners to benefit by effective discharging work days.

 

The facts

The vessel was chartered to ship coal from Wales to South America.

Clause 8 read in part:

“Time to commence when steamer is ready to unload and written notice given whether in berth or not. In case of strikes, lock-outs, civil commotions or any other causes or accidents beyond the control of the consignees which prevents or delays the discharging, such time is not to count, unless the steamer is already on demurrage.”

The charterers were also consignees.

The vessel arrived at the port of discharge, Villa Constitucion, six days after the commencement of a strike of engine drivers and stokers. Notice of readiness was duly given.

For the next fifteen days after arrival no work of discharging was done. During the following nineteen days work was partially resumed. The work actually carried out in this period was equivalent to 6¼ days at full capacity.

The strike was ended by governmental decree. Two weeks later the vessel was able to berth. Discharge took 22 days.

The parties were agreed that laytime did not run during the strike, despite the WIBON clause.

In issue was whether the 6¼ days effectively used in discharging during the strike counted as laytime.

Argument focused on the phrase “such time is not to count”. “Such time” could mean either the entire period while the strike lasted or it could mean the time effectively lost by reason of the strike.

Findings

Pickford J at first instance found for the charterers. The Court of the Appeal (Lord Reading CJ and Lush J, Phillimore LJ dissenting) reversed his decision. The House of Lords (Lord Parker of Waddington, Lord Sumner, Lord Parmoor and Lord Wrenbury) affirmed the Court of Appeal.

The result was thought by the House to reflect the commercial sense of the charterparty.

Commentary

Scrutton J decided the point in similar fashion in Northern Steamship Co v Central Argentine Railway (1913).

The case was decided without pleadings on an agreed statement of facts.

The case is not authority for the ascendance of the WIBON clause over the strike exception. The 6¼ days counted not because of the WIBON clause but because they were effectively not part of the delay caused by the strike.

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