CHAPTER XI. OF THE DISSOLUTION OF CONTRACTS FOR THE CARRIAGE OF GOODS IN MERCHANT SHIPS; AND HEREIN, (Ss.) 1. Of Dissolution by Mutual Consent, p. 452. 2. By events rendering the performance of the Contract illegal;-of War and 3. Of Blockade of the Port of Departure, p. 457. 5. Recent Decisions, p. 464. HAVING thus considered the several species of contract made for the carriage of goods in merchant ships, and the various duties arising therefrom, I proceed in the last place to the examination of the modes by which contracts of this nature may be dissolved. And these are, either the voluntary act of the contracting parties, or some extrinsic matter, happening after the making of the contract and before its completion. 1. Of Dissolution by Mutual Consent. It is a general rule that whatever derives its force and validity from the consent of parties, may by the mutual consent of the same parties be rendered null and invalid. There is, indeed, a technical rule of the law of England, which requires the discharge of a person from a contract to be made by an instrument of as high a nature as the original instrument of contract; and this rule is applicable to the contract of affreightment by charter-party under seal: but in case of a discharge by mutual consent not expressed in this formal manner, the rule would at the utmost have no other effect than to render it necessary for the party to apply to a Court of Equity. In all such cases, however, prudence requires that the deed should be cancelled and delivered up. But a merchant, who has laden goods, cannot insist upon having them re-landed and delivered to him without paying the frieght that might become due for the carriage of them, and indemnifying the mas ter against the consequences of any bill of lading signed by him (a). Indeed, a master who has signed bills of lading cannot with prudence deliver back the goods without having all the parts of the bill of lading delivered up to him; for if any one part has been transmitted to a third person, such third person may have acquired an interest in the goods. 2. By events rendering the performance of the Contract illegal ;of War and Embargoes. Another general rule of law furnishes a dissolution of these contracts, by matter extrinsic. If an agreement be made to do an act lawful at the time of such agreement, but afterwards, and before the performance of the act, the performance be rendered unlawful by the government of the country, the agreement is absolutely dissolved (b). If, therefore, before the commencement of a voyage, war or hostilities should take place between the state to which the ship or cargo belongs, and that to which they are destined, or commerce between them be (a) 2 Eq. Ca. Ab. p. 98, Anon. Thompson v. Trail, 2 Carr. & P. 334; ante, p. 254; and Tindall v. Taylor, 4 E. & B. 219. "We entirely agree,' " said Lord Campbell (delivering judgment in this latter case, and adverting to this passage), "in the law laid down by Lord Tenterden in his treatise, and in Thompson v. Trail, when applied to a general ship. By the usage of trade, the merchant, if he re-demands the goods in a reasonable time before the ship sails, is entitled to have them delivered to him on paying the freight that might become due for the carriage of them, and on indemnifying the master against the consignees of any bills of lading he may have signed for them; but these are conditions to be performed before the original contract can be affected by the demand of the goods. It would be most unjust to the owners and master of the ship if we were to hold that upon a simple demand, at any time, the goods must be delivered back in the port of outfit."-By the Code de Commerce, in such a case, art. 291, the merchant is enabled to reclaim his goods on payment of half of the freight to become due upon them, the expense of loading and unloading them, of unloading such other goods as are displaced on account of their removal, and of the delay which it occasions. If the ship be not a general ship, but chartered in whole or in part to carry the merchant's goods, and sail at a fixed time, he cannot withdraw them without paying the whole freight. "La différence," says Rogron," vient de ce que dans l'affrètement pur et simple, les engagements sont faits de part et d'autre sans aucune restriction, le capitaine a fixé son départ pour tel jour et a du compter sur ce jour. Au con traire, dans l'affrètement à cueillette, les engagements du capitaine ne sont que conditionnels; il n'a pas fixé un jour pour son départ, mais seulement l'époque ou son chargement sera complet. Si l'affrèteur lui retire ses marchandises il en sera quitte pour attendre un peu plus long temps afin de compléter ce chargement; d'ailleurs on a voulu offrir au chargeur une espèce de compensation de ce que dans cet affrètement le capitaine a le droit de rompre le voyage si son chargement est incomplet." (b) The Hoop, 1 Rob., A. R. 196. Potts v. Bell, 8 Term Rep. 548. In an action for a breach of contract, it appeared that the defendant undertook to convey the plaintiff's goods from Liverpool and to land them at Canton. On arriving there, the British superintendent of trade, acting under the orders of the government in England, prohibited the defendant from landing the goods, and a loss ensued. The defendant pleaded that he was prevented from performance by the officers of our Lady the Queen, duly authorized on that behalf, and exercising powers of government, &c. The officers were appointed by 3 & 4 Wm. 4, c. 39, s. 5, and acted under the orders of the Queen in Council, as authorized by section 6. The Court of Common Pleas held the plea bad, because it did not set out the orders under which the superintendent of British trade at Canton acted, nor did it set out that the performance of the contract had been prevented by any acknowledged prerogative of the Crown." But see now the judgment of the Court of Exchequer Chamber delivered by Mr. Justice Willes in Esposito v. Bowden, 7 E. & B. 763, 27 L. I., 2 B. 17. post p. 465. Evans v. Hutton, 6 Jurist, 1042. wholly prohibited, the contract for conveyance is at an end (c), the merchant must unlade his goods, and the owners find another employment for their ship. And probably the same principles would apply to the same events happening after the commencement and before the completion of the voyage, although a different rule is laid down in this case by the French ordinance (d), as I have before observed. But if war or hostilities break out between the place, to which the ship or cargo belongs, and any other nation, to which they are not destined: although the performance of the contract is thereby rendered more hazardous, yet is not the contract itself dissolved, and each of the parties must submit to the extraordinary peril, unless they mutually agree to abandon the adventure. So, if the government of the country, to which the ship and cargo belong, should prohibit the exportation of the particular commodities that compose the cargo, or by the terms of the contract are destined to compose it (as is sometimes done by all states with regard to provisions, in a time of scarcity), in this case also it seems that the law of the country would give no damages to the owner against a merchant who had been thus compelled by the law of the same country to abandon his engagement (e), but the contract would be dissolved on both sides. On the other hand, if a merchant hire a ship to go to a foreign port, and covenant to furnish a lading there, a prohibition by the government of that country to export the intended articles, neither dissolves the contract, nor excuses a non-performance of it (f); for the laws of one nation do not give effect to the positive institutions of another inconsistent with its own; and the different interests of nations sometimes render an act meritorious in one, which is prohibited by another in alliance with it, if the act be not contrary to the general law of nations, or to existing treaties; and the common exception of (c) French Ordin. liv. 3, tit. 1, des Charteparties, art. 7; Code de Com. art. 276. In respect of the question, who are to be considered enemies or not, the general principle is, that every person is to be considered as belonging to the country in which he has his domicile, whatever may be his native or adopted country. Story on Prize Courts, p. 59. The Vigilantia, I Rob. 1. The Endraught, 1 Rob. 19. The Sarah Christina, 1 Rob. 237. The Indian Chief, 3 Rob. 23. The President, 5 Rob. 277. The Neptunus, 6 Rob. 413. McConnel v. Hector, 3 Bos. & Pull. 113. Bynk, Q. J. Priv. ch. 3. If a person goes into a belligerent country originally for temporary purposes, he will not preserve his neutral character if he remain there several years, paying taxes, &c. The Harmony, 2 Rob. 322. The Embden, 1 Rob. 17. And a neutral consul resident and trading in a belligerent country is, as to his mercantile character, deemed a belligerent of that country. The Indian Chief, 3 Rob. 22; the Josephine, 4 Rob. 25. And the same rule applies to the subject of one belligerent country resident in the country of its enemy, and carrying on trade there. The Citto, 3 Rob. 38; 3 Bos. & Pull. 113. But the native character easily reverts, as by a person putting himself in itinere, to return to his native country, animo revertendi. The Indian Chief, 3 Rob. 22. La Virginie, 5 Rob. 98. It is a fundamental principle of prize law that all trade with the enemy is prohibited to all persons, whether natives, naturalized citizens, or foreigners domiciled in the country, during the time of their residence, under the penalty of confiscation. Story on Prize, p. 69. The Vigilantia, 1 Rob. 1, 14. The Hoop, 1 Rob. 196. Potts v. Bell, 8 Term Rep. 548. (d) Liv. 3, tit. 3, Fret, art. 15. See before, part 4, chap. 9, sec. 5. and the Code de Com. art. 299. (e) By Lord Ellenborough, in Barker v. Hodgson, 3 M. & S. 267. (f) Blight and Others v. Page, Guildhall Sitt. after Mich. Term, 1801, before Lord Kenyon, Ch. J., cited 3 Bos. & Pull. 295, note (a), and see Sjoerds v. Luscombe, 16 East, 201. the restraint of princes and rulers applies only to the case of the master (g). But in such a case, or if the default be owing to the personal neglect or inability of the freighter, and not to any general cause, the master, upon his arrival at the port of lading, should obtain another cargo, if possible, from other persons, and not sullenly hoist sail and depart, in order to charge the merchant with the whole freight. And if upon the ship's arrival he is informed that the merchant is unable to furnish the lading, he cannot, by waiting the time appointed in the charter-party, charge the merchant with the demurrage (h). It has also been held, that a contract was not dissolved, nor a merchant excused, for the non-performance of his covenant, by a prohibition of intercourse on account of an infectious disease (i). But although contracts of this nature are dissolved by the breaking out of war or hostilities in the manner before mentioned, of which no person can foresee the termination; yet they are not dissolved by an embargo, or temporary restraint of their performance imposed by the government of the country in whose ports the vessel may happen to be, as a measure of political caution in time of war, or upon the expectation of it, either in the lading port, or in a place at which the ship may have touched in the course of her voyage (k). This subject has received a judicial termination in the law of England. The case (1) was as follows:-Hadley, the plaintiff, brought an action against Clarke and Others, owners of the ship Pomona, for not carrying to Leghorn goods put on board the Pomona, at Liverpool, to be conveyed to Leghorn, the danger of the seas only excepted. The plaintiff had paid 297%. 188. for insurance of the goods for the voyage. The ship sailed from Liverpool, and in pursuance of permission given for that purpose, put into Falmouth on the 30th of June, 1796, to wait for convoy. While she waited there for that purpose, an embargo was, by order of the King in Council, dated 27th of July, 1796, laid on all ships bound to Leghorn, being one of the ports in the territories of the Grand Duke of Tuscany, then in possession of the French. This embargo was directed to continue until further order of the board of Privy Council. On the 23rd of August following another order of Council issued, allowing vessels in the situation of the Pomona to return to their ports of lading, and land and warehouse their cargoes there under certain regulations. In the month of August, 1798, and not before, the Pomona left Falmouth, without the consent of the plaintiff, and returned to Liverpool, where after some dispute the plaintiff received the goods without prejudice to the question, whether under the circumstances the defendants were excused for the non-performance of their contract. On the 24th of October, 1798, the embargo was taken off. At the trial of the cause the plaintiff obtained the verdict of a jury for the (9) Blight and Others v. Page, and see also as to this point, Touteng and Another v. Hubbard, 3 Bos. & Pull. 298. (h) Blight and Others v. Page. (i) Barker v. Hodgson, 3 M. & S. 267. (k) French Ordin. liv. 3, tit. 1; Des Charte-parties, art. 8, and see liv. 3, tit. 3, Fret, art. 16; Pothier, Charte-partie, num. 100. (1) Hadley v. Clarke, 8, Term Rep. K.B. 259. amount of the charges of insurance. The right of the plaintiff to recover was afterwards solemnly discussed in the Court of King's Bench; and the Court was of opinion that the embargo did not dissolve the contract, being only a temporary restraint, and that the plaintiff had a right to recover. Before the commencement of the transaction between the parties, all intercourse with countries under the government of the French, during the then existence of hostilities between France and this country, had been prohibited by Act of Parliament (m); but this prohibition was also held to be only temporary with respect to Leghorn, and consequently not to alter the case. In the case of an embargo, the French ordinance expressly authorizes the merchant to unlade the goods at his own expense, if he thinks fit, upon condition to relade them or indemnify the master (n); and Valin (o) and Pothier (p) declare it to be their opinion, that if the goods are of such a sort that they will not keep during the period of the embargo, and cannot at its expiration be readily replaced by others of the like kind, the embargo will put an end to the contract. In such a case, whatever the rule of law may be, the interest of all parties will in general induce them to annul the contract upon reasonable terms. But in the case of an embargo imposed by the government of the country of which the merchant is a subject, in the nature of reprisals and partial hostility against the country to which the ship belongs, the merchant may put an end to the contract, if the object of the voyage is likely to be defeated by the delay. Thus in the case of a Swedish ship, chartered by a British merchant to go from London to St. Michael's for a cargo of fruit, which, having sailed on the voyage, was driven back by contrary winds and forced into Ramsgate harbour, and there stopped, on the 15th of January, 1801, by the embargo imposed by the British government on all Swedish vessels; upon which the merchant applied to the captain to give back his letters of advice, who declined to do so, and who, soon after the embargo was taken off, which happened in the following June, offered to proceed on the voyage, but was directed by the merchant not to do so, because the season for shipping fruit was then passed: the Court of Common Pleas held that the master could not maintain an action against the merchant for the non-performance of the contract (g). For otherwise a British subject would sustain the evils that the government of his country intended to inflict on foreigners; which is contrary to the principle now established in the law of insurance, viz., that the insurer is not answerable for a loss happening to an enemy by British capture in a course of hostilities, whether existing at the time of insurance, or taking place afterwards (r). In the case of another Swedish vessel stopped under the same em (m) 33 Geo. 3, c. 27, s. 3. (n) Liv. 3, tit. 1, Charte-parties, art. 9. (0) Tom. 1, p. 628. (p) Charte-partie, num. 102. (q) Touteng and Another . Hubbard, 3 Bos. & Pull. 291. (r) Furtado v. Rodgers, 3 Bos. & Pull. 191, and Kellner v. Le Mesurier. Gamba v. Mesurier, and Brandon v. Curling, all three decided in the Court of King's Bench in Mich. Term, 1803, and reported 4 East, 396, 407, 410. |