CHAPTER IX. OF PAYMENT OF FREIGHT; AND HEREIN, SECT. 1. In the absence of Express Stipulations, Freight is not due until the Voyage has been performed, p. 362. 2. Modes of Calculation. Of an agreed Sum for the Voyage. Of Tonnagefreight. Of Time-freight, p. 366. 3. Time and Manner of its Payment. Of the Words" On Payment of Freight in Bills of Lading, and of their Effect where Delivery has been made without Payment, p. 370. 4. When a Contract to pay Freight may be implied against the Receiver of Goods under the usual Bill of Lading, p. 373. 5. Equivalent Recompense in the Nature of Freight, to which (Freight not having been earned) the Shipowner is in some Cases entitled, p. 377. 6. Freight on Illegal Voyages, p. 378. 7. Whether Damaged Goods are exempt from Freight, or may be abandoned for it, p. 379. 8. Of Freight when part of the Goods only have been brought to the Place of their Destination, and of Freight pro ratâ itineris peracti, p. 385. 9. When the Right to Freight commences, p. 407. 10. Of Entire, Divided, and Intermediate Voyages. Freight how payable, p. 408. 11. Of the Jurisdiction exercised by the Court of Admiralty respecting the Freight of Goods condemned as Prize, p. 414. 1. In the absence of Express Stipulations, Freight is not due until the Voyage has been performed. IN treating of the payment of the freight, the principal duty of the merchant, I shall consider, first, the case in which the entire freight is to be paid according to the terms of the contract; and, secondly, those cases in which a part only of the stipulated sum may be claimed. The contract for the conveyance of merchandise is in its nature an entire contract, and unless it be completely performed by the delivery of the goods at the place of destination, the merchant will in general derive no benefit from the time and labour expended in a partial conveyance, and consequently be subject to no payment whatever, although the ship may have been hired by the month or week. The cases in which a partial payment may be claimed are exceptions founded upon principles of equity and justice, as applicable to particular circumstances (a). On the other hand, an interruption of the regular course of the voyage happening without the fault of the (a) Crozier v. Smith, 1 Scott, N. R. 338. owner does not deprive him of his freight, if the ship afterwards proceed with the cargo to the place of destination, as in the case of capture and recapture (b). In this country it is not unusual to pay for goods shipped for the East and West Indies at the time of shipment; but this payment, although in common parlance called freight, is not in strictness properly so denominated, that word denoting the price rather of actual carriage than of receiving goods to be carried. Accordingly, in the case of Blakey v. Dickson (c), Lord Eldon and the Court of Common Pleas, admitting that an action might be brought for money agreed to be paid for receiving goods on shipboard, in order to be transported, decided that such money could not be sued for or recovered by the name of freight. Some time after this determination an action was brought upon a supposed agreement of the nature here alluded to, the plaintiff alleging, that in consideration of his undertaking to receive on board his ship certain goods belonging to the defendant, to be carried therein from London to Lisbon, the defendant promised to pay him a certain sum of money on the shipment of the goods. The bills of lading were the only evidence offered by the plaintiff at the trial of the cause to prove his allegation. These imported, in the usual way, that the goods were to be delivered at Lisbon; but the clause respecting the payment of freight, in some of them ran thus-"freight for the said goods being paid in London ;" and in others thus-"the shippers paying freight for the said goods in London." The ship was lost on the voyage. Lord Ellenborough, before whom the cause was tried, was of opinion that these words meant no more than that the freight should be paid in London instead of Lisbon, and did not dispense with the performance of the voyage; and added, that if the shipper had paid the freight upon the shipment of the goods, he might have recovered it back again. The plaintiff, therefore, failed in his suit (d). The case turned wholly on the bill of lading. There was no indication of an intent, that if the freight were not earned, the money might not be recovered back. But in a cause since decided in the Common Pleas, the bill of lading containing the words "freight for the said goods being paid," the broker who freighted the ship proved that the contract for the conveyance of the goods was verbal, and that he told the defendant that the price of the freight of goods upon a voyage from London to the Cape was 57., paid in London, or 71. paid at the Cape: the defendant preferred the contract at 57. per ton. Soon after the vessel had sailed the broker called on the defendant for (b) The Race Horse, 3 Rob. Ad. & R. 101. And see the observations of Mr. Justice Chambre and Lord Alvanley in the case of Beale v. Thompson, 3 Bos. & Pull. 420 and 431, upon the dictum of the late Ch. J. Eyre on this subject, in the case of (d) Mashiter v. Buller and another, 1 Campb. 84. payment, who answered, he would call and pay it on the following Monday. The ship was lost. Gibbs, Chief Justice, left it to the jury to consider, whether the agreement intended merely to change the place where the freight should be payable, in case any freight should be earned, or whether, in lieu of a contract for freight, it was intended that this sum should be payable, at all events, after shipping the goods; and the jury found that the meaning of the agreement was, that the money should be paid, at all events, upon the delivery of the goods on board the ship at London. The court refused to dis turb the verdict; and Gibbs, Chief Justice, said, "Here is an indication not only of the place where the money was to be paid, but also of the time when it was to become due, which was not the case in Mashiter v. Buller;" and added, "It signifies not what name is given to the money. The defendant is misled by the ambiguity of the phrase freight. There is no doubt but that a man may agree to pay money on the delivery of the goods on board the ship, call it what you will" (e). But although, by the policy of the law, freight strictly so called, does not become due until the voyage has been performed, it is competent to the parties to a charter-party to covenant by express stipulations in such manner as to control the general operation of law. If the charter-party be silent, the law will demand a performance of the voyage, for no freight can be due until the voyage is completed. But if the parties choose to stipulate by express words, or by words not express, but sufficiently intelligible to that end, that a part of the freight should be paid absolutely by anticipation, and not depend upon the performance of the voyage, they are at liberty to do so (f). Such stipulations are by no means uncommon, for the owner of a ship frequently has no agent at the port of loading, but the freighter always has, and therefore naturally enough, stipulates to advance money to the owner, which, upon the ship's safe arrival, is as naturally in practice deducted from the freight (g). Whether money advanced by the merchant is to be considered as a loan to be reimbursed by the owner, or as part payment of the freight, not dependent upon the performance of the voyage, must depend upon the terms of the written instrument upon the construction of which the question arises. A charter party contained a covenant, that "1207. should be paid upon freight of the outward cargo to Maranham, and as much cash as might be found necessary for the vessel's disbursements in Maranham, to be advanced by the merchant, his agents or assigns, to the master when required, free from interest and commission, at the current exchange of the place, and the residue of such freight to be paid on delivery of the homeward cargo in Liverpool." The ship having been lost by capture, the Court of King's Bench decided that the merchant was not entitled to (e) Andrew and another v. Moorhouse, and Clark v. Druisina, there cited, 5 Taunt. 435, and 1 Marsh. 122. (f) Per Lord Ellenborough in De Silvale v. Kendall, 4 M. & S. 37, post, 365. (g) Mansfield v. Maitland, 4 B. & A. 585. recover back, under this charter-party, money advanced by him for the vessel's disbursement in Maranham; the words above printed in italics clearly intimating that the advance was not to be by way of loan, but in part payment of freight, of which the remainder only was to abide the usual risk which the law casts upon the earning of freight for the conveyance of the cargo to the place of its destination (h). But where the charter-party contained a covenant for payment of freight, one-half in cash on unloading and right delivery of the cargo, and the remainder by bill on London, at four months' date, and a memorandum "the captain to be supplied with cash for the ship's use," in pursuance of which the master drew a bill, which was accepted and paid, upon the charterers for cash so supplied, this was decided to be a loan to be reimbursed by the owner (i). "The case of De Silvale v. Kendall," said Lord Tenterden on this occasion, "turned upon the particular words of the instrument, which was studiously framed, so as to make the freighter lose the money advanced by him, unless the owner reaped the benefit by the ship's coming home safe. The present charter-party, is in a very different form. It is undoubtedly competent for the owner to make such a stipulation as that in De Silvale v. Kendall; but if he does so, it is his duty to take care that it is inserted in clear and explicit words in the charter-party that the money advanced shall be an advance in part payment of the freight." By charter-party for a voyage from London to Calcutta and back, it was agreed that the freighter, if he thought proper, might hire the vessel for an intermediate voyage, within certain limits, for not less than six months; and, in that event, the master should refit the vessel for such a voyage. The complement of men was to be kept up, and all necessaries provided; the freighter on his part agreeing to pay the owner for such voyage the sum of 17. a ton per month on the ship's tonnage, to pay four months of such hire in advance; and at the end of six months two further months' pay, and so in every succeeding two months; and the balance due at the termination of such hiring in cash or approved bills. It was further stipulated, that if the vessel should be lost or captured, the freight by time should be payable up to the period when she should be lost or captured, or last heard of. The freighter took the vessel for the intermediate voyage, in the course of which, and before the expiration of the four months for which payment had been made in advance, she was lost. He then claimed to have the money so advanced returned to him, and contended, that the last-mentioned clause, by which it was stipulated that the freight should be payable only to the time at which the vessel might be lost, was inconsistent with the owner's title to the whole four months' freight. But the court rejected the claim, and Lord Tenterden, C. J., said, "The law is thus laid down by Saunders, C. J., in 2 Shower, 283: Advance money paid before, if in part of freight, and named so in the charter-party, although the (h) De Silvale v. Kendall, 4 M. & S. 37. (i) Mansfield v. Maitland, 4 B. & A. 581. ship be lost before it come to a delivering port, yet wages are due according to the proportion of the freight paid before-for the freighters cannot have their money.' This is the ground of the doctrine which was acted upon in De Silvale v. Kendall, that money paid in advance of freight cannot be recovered back" (k). In a recent case, where a charter-party contained the following clause, "cash for ship's disbursements to be advanced to the extent of 300l., free of interest, but subject to insurance, and 27. 10s. per cent. commission," Lord Campbell, with whom the other learned judges of the Court of Queen's Bench concurred, said, "This mention of insurance, seems to me to stamp the transaction indelibly as a payment on account of freight, and not a mere loan, for if the advance was to be insured, it must be an advance of freight which is insurable, whereas a loan is not. There is nothing necessarily inconsistent in the other clause-'the freight to be paid on unloading and right delivery of the cargo,' which may refer to the payment of the residue of the freight not already advanced" (l). The stipulation in a charter-party that freight shall be paid subject to insurance," means that freight shall be paid subject to an allowance to the charterer of the premiums of insurance, i. e., that the shipowner shall receive as much less on account of freight as will enable the charterer to insure it-in other words-cost of insuring the advance to be borne by the shipowner, and to be in part payment of the freight (m). With respect to living animals, whether men or cattle, which may die during the voyage, without any fault or neglect of the persons belonging to the ship, it is said (n), that if there be no express agreement whether the freight is to be paid for the lading or for the transporting them, freight shall be paid as well for the dead as for the living. If the agreement be to pay freight for the lading them, their death certainly cannot deprive the owners of the freight; if the agreement be to pay freight for transporting them, then no freight is due for those that die on the passage, because, as to them, the contract is not performed. These distinctions are found in the civil law, and adopted by all the writers on this subject (0). If a pregnant woman be delivered during the voyage, no freight is due for the infant (p). 2. Modes of Calculation. Of an agreed Sum for the Voyage. When goods are sent in a general ship, in pursuance of the second species of contract before mentioned, the amount of the freight is either settled by the agreement of the parties, or by the usage of the (k) Saunders v. Drew, 3 B. & Ad. 445. (1) Hicks v. Shield, 7 Ad. & E. 633; 26 L. J. (N. S.) Q. B. 205. (m) Jackson v. Isaacson, 3 H. & N. 405; 27 L. J. (N. S.) Exch. 502. (n) Dig. 14, 2, 10. Roccus, not. 76–78. Molloy, book 2, ch 4. (0) Moffat v. East India Company, 10 East, 468. (p) Roccus, not. 79. Molloy, book 2, p. 4, sect. 8. |