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REPORTS-1924, SCOTS LAW TIMES.

The matter of the succession duty stands differently.

By section 42 of the Succession Duty Act, 1853, it is provided that succession duty shall form a first charge on the interest of the successor in the real property in respect of which said duty is assessed. But as I read the section the charge thus created is a charge in favour and for the security of the Crown. As was pointed out in the case of Laurie (25 R. 636 at p. 639), the Act of 1853 does not carry forward a charge in favour of the person paying the duty, there being no express counterpart of sections 9 (5), 9 (6), and 23 (18) of the Finance Act. And in order to cast this burden on to the fee of the entailed estate or its surrogatum, statutory authority must no doubt be found.

Section 44 of the Act of 1853 expressly provides for the case in which the succession duty is actually paid, not by the successor but by trustees and the like who are vested for the time in the property subjected to the duty. Such persons, being accountable for the duty, are empowered on paying the same to retain the amount, or to raise the amount of the duty and incident expenses by a bond over the estate, which bond, I take it, may be granted either to themselves or to such other person as shall advance the money. But I was not referred to any statutory authority expressly covering the case in hand, or to any judicial decision in

19

accident that the duty has been settled before BILL the application is made, should not, I think, CHAMBER. foreclose the right of the heir to exercise a Petition, power which would otherwise be open to him. BedellIn the result, accordingly, I hold the matter Sivright's of the succession duty to be in pari casu with Curator the estate duty.

Bonis.

No question is raised in the note in regard October 30,

to interest on the duties paid, and there remains only the crave as regards the expenses of and incident to the note.

In certain cases the Court have declined to throw the burden of such expenses upon the fee of the entailed estate. This was the result in Laurie's case, but this was an application to authorise the granting of a bond over the estate for the duties and expenses; and, following the line of older decisions (Blair, 3 М. 698; Maclaine, 5 R. 1053), the Court declined to add the expenses of the application to the amount of the bond to be granted. The entailed estate being in forma specifica, it was impracticable to exercise the general powers conferred by the Act of 1875, section 12 (6). The cases of Harris' Trs. (6 F. 470), followed in Farquharson's Trs. (1915, 2 S.L.T. 176), were cases of ordinary trusts, not of entails. In these cases, also, the question was as to the charging of the fee by bond, and the same decision was given as regards expenses. The present application, however, stands differently. It is a note

which the matter has been raised or discussed in a pending petition presented under the Act

for

in circumstances such as the present. I am of opinion, however, that sanction for granting the crave of the note may be found in the entail statutes. The Act of 1848, section 25, inter alia, authorises an heir of entail, subject to the sanction of the Court in cases in which the fee of the estate is validly charged with debt, to sell the same "for the purpose of paying off the debt in respect of which the said charge has been or might be competently made." And the Act of 1853, section 9 (which was passed subsequent to the Succession Duty Act), gave the like powers of sale in all cases in which there should be entail debts or "other debts or sums of money which might lawfully be made chargeable upon the fee of an entailed estate." It may be argued that where succession duty is paid by the proper debtor, viz. the heir-inpossession or his representative, the debt is extinguished by payment and ceases to be effective as a basis for a charge upon the estate. But this, in my opinion, would be a somewhat narrow view. The section is in its term wide enough to cover all cases of "lawful chargeability" irrespective of who may be the creditor under the charge, whether the Crown, the heirin-possession, trustees, or other persons accountable, who, by paying the duty, become in effect the assignee of the Crown charge. The mere

of 1882, which, by section 23 (9), expressly authorises such expenses as a charge upon the moneys forming the price of the estate which has been sold. And the estate being in the form of money the practical difficulty above referred to does not arise. This distinction is well illustrated by a comparison of the two casesMacKechnie (6 S.L.T. 242) and Steuart Menzies (10 S.L.T. 636). I shall accordingly grant the necessary authority as regards the expenses of the application.

The certificates produced appear sufficiently to vouch the amounts of the duties paid, as also that the same were paid in respect of the entailed estate, for which the money held by the trustees is a surrogatum. A remit to a man of business would therefore appear to be necessary only in order to see that the transaction is duly carried out in terms of the order and authority of the Court.

Counsel for Petitioner, Maconochie; Agents, Tods, Murray & Jamieson, W.S. J. A. L.

1923.

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REPORTS-1924, SCOTS LAW TIMES.

A

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November 23, 1993.

v. Owners of the "Clan Gordon."

Ship Total loss - Seaworthiness Competence of master-Instructions for safe navigation of ships of special construction issued by builders to owners but not communicated by owners to the master-. Ballast tanks emptied at sea by master contrary to builders' instructions-Vessel turning over and sinking-Held (reversing judgment of First Division) that the failure of the owners to communicate the

builders' instructions to the master rendered the vessel unseaworthy, that such failure was the cause of the loss of the vessel, and that the owners were liable for loss of the cargo.

Ship-Total loss-Loss of cargo-Liability of shipowners -Bill of lading-" Harter Act "- Clause in of lading exempting owners from liability for "accidents of navigation of whatsoever kind (even when occasioned by the negligence, fault, or error in judgment of the pilot, master, mariners, or other servants of the shipowner, not resulting

...

from want of due diligence by the owners of the ship .) "-Failure of owners to communicate to the master certain instructions issued by the builders for the safe navigation of ships of a special construction-Held that such failure was fault on the part of the owners and that they were liable

to cargo owners for consequent loss of ship and

cargo.

(Reported ante, 1923, S.L.T. 130.)

Appeal from an Interlocutor of the First Division (the Lord President, Lords Skerrington and Cullen, dissenting Lord Sands).

The pursuers appealed to the House of Lords. The appeal was heard on 24th, 25th, and 26th July 1923.

On 23rd November 1923 their Lordships reversed the interlocutor appealed from, restored the interlocutor of the Lord Ordinary, and found the respondents liable in costs in their Lordships' House and in the Court of Session, reserving as to modification in the Court of Session.

Viscount Haldane. In the opinion which I am about to deliver, my noble and learned friend, Lord Birkenhead, desires me to say that he concurs.

The mixed question of fact and law that arises in this appeal is one which necessitates close examination. Only after modifying my own view from time to time as the arguments at the Bar proceeded, and after subsequently re-studying the whole of the evidence and the judgments in the Courts below, have I arrived

at the conclusion that the Lord Ordinary and Lord Sands were right, and that the judgment of the majority in the First Division cannot stand.

Having regard to the concurrence of findings on what is an issue of fact, I think that we are bound to hold that it was established by the respondents that when the "Clan Gordon" left New York she was physically seaworthy. But it appears to me to be not less clearly shewn that she was thus seaworthy only on the footing of having two out of six of her ballast tanks filled, to the extent of containing 290 tons of water. Without this amount of water in the tanks she was not, having regard to her loading, seaworthy, and the master in charge of her had to know this and observe the requirement through his voyage. He did not know it; he pumped out the water, and the ship heeled over and was lost two days after her commencement of the voyage. I think that the requirement as to this ballasting was due to the construction of this steamer as a turret vessel. Only scientific calculation could shew the absolute character of a requirement which if not observed would render the ship unseaworthy. The master had not been instructed as to its special significance in the case of a turret ship like the "Clan Gordon." He could not divine it, nor could the ordinary experience of a master not informed of the special peril due to abnormal construction be relied on to disclose it. The master did not know the unusual risk he was called on to undertake. The fault of this absence of knowledge lay not with him but with the owners, whose duty it was to have instructed him that while the vessel was seaworthy it was only conditionally seaworthy. The breach of the condition was therefore an occurrence for which they were personally in fault.

In the light of what has been proved, the two tanks held just enough water to give the vessel the stability indicated in the builders' instructions. But it is significant that the master was not shewn to have been specially warned that the presence of the water-ballast was essential to the ship as loaded, if its stability was to be preserved. The instructions of the builders shewed that such ballasting was essential, and the master was not told about it. In his evidence Captain M'Lean says that it was the first cargo of the kind that he had actually loaded himself, and that before he sailed he had intended to sail with his ballast tanks empty. This makes it not surprising that two days later he directed that the tanks should be pumped empty. He hoped to obtain thus more freeboard for his vessel. He says that he had got no instructions from his owners that, with a homogeneous cargo he was on no account to pump out the ballast

REPORTS-1924, SCOTS LAW TIMES.

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tanks. All he knew was that those in charge conclusion than that Doxfords thought there HOUSE of turret ships were to be careful of them. were risks in the case of turret ships, as to which OF LORDS.

But he knew nothing of the Doxford instructions [issued by the shipbuilders to the owners]. Had he been informed of them he says that he would have obeyed them. But the reason of the necessity for what they prescribed was not known to him. He had been in command of the "Clan Gordon" for some time previously, and had been employed on other turret ships, and had found no difficulty. The case with which he had to deal, of a ship loaded just as this one, was, however, new to him, and he appears to have somewhat overestimated the proportion between the cargo in the lower holds and that between the decks. If he had known that there was not so much weight in the lower holds, it may be that he would not have emptied the tanks. Captain M'Lean was admittedly a competent and experienced

of the

1993.

special guidance for masters was required. It Standard
is true that the instructions were prepared and Oil Co. of
sent out by the builders, not only long after the New York
ship was built but many years before the v. Owners
accident, and that they are open to some " Clan
criticism of the calculations on which they are Gordon."
founded. But the substance which underlies November 23,
what they prescribe remains. They suggest
to instructed persons that, as in the case of a
turret ship there is danger of righting force
diminishing more rapidly than in the instance
of a wall-sided ship, it is necessary to provide
an appropriate amount of special ballast. This
seems to follow from the proposition that the
ship is not to be loaded down to her marks with
a homogeneous cargo without water or other
adequate ballast. In so far as this is scientific-
ally true, no amount of fortunate experience

officer, and there had been no difficulty with in the course of which the peril happens not
turret ships excepting in the case of the "Clan to have matured can properly be set against it.
Ranald," when the disaster was due to the care- Under these circumstances, and with the
lessness of another master. Captain M'Lean
simply did not imagine that he could be running
a serious risk when he began to pump out the
tanks at sea, and nothing in his experience of
turret ships had pointed to there being such a
risk as there actually was.

No doubt the primary and immediate cause of the disaster which occurred to the "Clan Gordon" must be taken to be, not defect in the initial loading, but the pumping of the tanks out at sea just before the disaster happened. But, then, if the Doxford instructions meant anything, they meant that such pumping must not take place. Whether its effect would be to destroy general stability, or to enable the free water to cause a dangerous disturbance of stability by the rush to the sides of the half empty tanks, does not matter. The instructions obviously implied not only that water must be kept in tanks that were filled

but that it must not be withdrawn.

builders' warning in their hands, was it the
duty of the owners to inform the masters of
their turret ships of the special risk to which the
turret form gave rise? I think that it was.
On the mere experience and skill of the individual
master they could not safely rely. He might
never have given thought to any unusual critical
point as possible in the stability of his ship,
or have been in circumstances from which he
could derive the necessary experience. The
deduction of the critical point was, as I have
said, the outcome of scientific calculation, rather
than of practice. But that circumstance did
not render it the less important, or justify people
in thinking that it was of such a nature that it
could be left to be divined by those who had
not been specially instructed.

I think that the true conclusion as to this
case is that expressed in a passage near the end
of Lord Sands' dissenting judgment in the

First Division. "The broad view of the matter On this point at least the instructions do not appears to me to be this: A vessel of a peculiar seem to me to be ambiguous, and if they had type was lost under circumstances not satisbeen given to Captain M'Lean, we must take it factorily explained. This led the builders to that he would have interpreted them properly issue certain instructions in regard to the loading and carried them out. There is no doubt that of such vessels. If these instructions had been Doxfords [the builders] sent them round as observed the 'Clan Gordon' would not have being suggested by their investigation of the been lost. The defenders took no steps to circumstances which led to the overturning of bring these instructions to the knowledge of the "Clan Ranald." It may be that ordinary the master of the 'Clan Gordon." I see no ships might have proved to be subject to some sufficient answer to the reasoning either of analogous peril, but not, so far as we can gather Lord Hunter, the Lord Ordinary, or of Lord the views of Messrs Doxford, to the same extent. Sands. Not the less it is hardly admissible Mr Holey, their assistant chief draughtsman, to come to this result easily without careful

says in his evidence that the document, a copy of which was sent out for each turret ship, was meant to prescribe what was to be provided when loading. It is difficult to draw any other

consideration of the judgments of the majority
in the First Division. For I have rarely read
judicial opinions on a technical question which
impressed me more by their care in expression

v. Owners

1923.

as being a special and exceptional one by the
calculation by the builders. The owners ought
to have known of this, and it is obvious that the
master might well not have. Even experienced
navigators seem not to have come to suspect
it in the course of their voyages in these turret
ships. Captain M'Lean suspected danger so
little that, if left to himself, he tells us that he
would have pumped out his tanks before leaving
New York. The instructions from Doxfords'
office, of which he knew nothing, were, as Barr,
the managing director of the respondents, says,
a surprise to the respondents themselves, who
appear not to have taken them seriously, or
to have made any independent attempt at
the time to see whether they were or were not
well founded. And yet her righting power
depends largely on the shape of a vessel, and is
a matter which can only be accurately ascer-
tained by highly technical and highly scientific
study. I am, therefore, unable to agree with
the Lord President when he says that it would
be detrimental to security at sea to put on
owners who have appointed a competent master
a duty to give him instructions even in such
special circumstances. Unless this is done, the
most competent master may not be aware of
risks of which only exact knowledge, extending
beyond any which he can be assumed to possess,
can inform him.

HOUSE than those of the majority as well as of the this case, specific danger had been established
OF LORDS. minority in the Courts below. The Lord
Standard President holds that the builders' instructions
Oil Co. of were fallacious in that, even if the cargo was so
New York far from being homogeneous that the ratio of
of the the density of what was between decks to what
"Clan was in the lower holds was only 83 per cent.,
Gordon." somewhere near 500 tons of water was required
November 23, in the ballast tanks to give stability. This
he thinks to be out of the question, inasmuch
as the ship was shewn to be actually stable
with only 290 tons of water in the tanks. He
attributes this error, he suggests, to defective
calculation by Doxfords about the cargo. But
he goes on to say that even if this be so it is not
wholly fatal to the pursuers' case, inasmuch as
the master admitted that if the owners had
communicated to him Doxfords' instructions
he would not have pumped out the 290 tons
after leaving port, whatever he might have
thought about the necessity of these instructions.
I am not satisfied that all the criticisms on
calculation of the cargo made by the Lord
President were wholly well founded. But even
if they were, I think he has himself given the
answer to them. For it is not in serious dispute
that the vessel was defective in righting power
and, therefore, unseaworthy when loaded
unballasted down to her marks with a homo-
geneous cargo. The criticism of the Lord
President does not affect this proposition.
It may be that the wash over of the water in
the half-emptied tanks contributed to and
accelerated the turning over of the vessel.
But if the master had been told that she was
unstable without 290 tons of water-ballast
he would not have begun to pump out the tanks.
It is no answer to say that the Clan Gordon"
and other steamers of the same turret construc-
tion had previously made successful voyages
without any water-ballast. That may have
been their good fortune. But it does not prove
that to make such voyages without special

66

The reasons just given leave open, even assuming the view which I have expressed to be true, yet another point urged on their behalf by the defenders. They argue that as the instructions from the builders were, when received, passed on to Mr Lyall, the defenders' engineer, now dead, this relieves them from responsibility. For Lyall was their servant and as such responsible to them for all structural matters, and for giving instructions to the masters of their ships. If this be so, they contend that their liability cannot extend to the full sum the Lord Ordinary, but is limited to £27,581,

ballast was safe. Careful scientific calculation of £97,892, 17s. 7d. awarded to the pursuers by

has, in my opinion, demonstrated conclusively
that it was not, having regard to the restriction Os. 9d., being the amount calculated on the

It is

footing of a liability of £8 for each ton of the
ship's tonnage. This contention they base on
section 503 of the Merchant Shipping Act, 1894
(as amended by section 69 of the Merchant
Shipping Act, 1906), which limits the liability
where the damage has been occasioned without
the actual fault or privity of the owner.
now well settled that those who plead the
section as a defence must discharge the burden
of proving that they come within its terms.
That is to say, they must shew that they were
themselves in no way in fault or privy to what
occurred: in this case, to the failure to render
the ship properly seaworthy, by taking care

on righting force in the case of a turret ship, and
the tendency of the righting force to diminish
rapidly after a point has been reached which is
only reached substantially later in the case of
a wall-sided vessel. The Lord President thinks
that the danger to the ship was one which
neither arose from a latent peril in her con-
struction, as in the case of the "Schwan"
([1908] P. 356; [1909] P. 93), nor from anything
lying beyond the scope of competent seamanlike
skill. He is, therefore, of opinion that if there
was blame for the accident it is the master and
not the owners who are made responsible for
it under the charter-party and the bills of
lading and the Harter Act. But surely, in that the master was instructed about the special

e

of the

1028.

risk arising from its shape. Now, even on the
assumption that the late Mr Lyall was fully
directed to instruct the master on this point,
and that the failure to do so was his fault, the
owners are surely not discharged from responsi-
bility. For their personal duty was to provide
a seaworthy ship, and the ship was not sea-
worthy if the master was not instructed on
the special matter in question. That they left
their duty to be discharged by Lyall, as their
servant or agent, therefore, does not relieve
the owners of blame. Their responsibility as
regards seaworthiness was an individual one
of which they could not divest themselves,
and when they left its discharge to Lyall they
did so at their own risk. I am well aware of
the magnitude and seriousness of the conse-
quences of this conclusion to the respondents,
but I am unable to see how what they did
divested their breach of duty of these conse-
quences. I therefore think that the interlocutor
of the Lord Ordinary should be restored, and
that the respondents must pay the costs here
and in the Inner House. As to the point made
by Mr Macmillan about expenses, it is true
that the pursuers failed technically in the part
of their case which related to physical sea-
worthiness in New York Harbour. But the
evidence they led on this point was not easily
severable from the evidence required on the
broader issue on which they succeeded.
Accordingly, I do not think that we ought to
interfere with the exercise made of his discretion | certain not improbable conditions unless special

reveal, calculation of a kind which no ordinary House
master, however long his experience at sea, or LORDS.
could be reckoned on as having either made or Standard
as having been able to make. Thus it was the Oil Co. of
duty of the owners, whose business in making New York
their ship seaworthy was to have the master v. Owners
instructed as to all defects in seaworthiness " Clan
during the voyage arising from inherent causes Gordon."
that were not obvious, and of which his merely November 23,
practical knowledge could not be relied on to
inform him. This the owners in the case before
us failed to do, when they did not bring to the
mind of the master of a turret ship the Doxford
special instructions. These instructions may
be open to criticism in detail, though I think
that the Lord President attaches more import-
ance than is due to the effect on their substantial
validity of the points he made. But, as the
Lord President himself concedes, they shew
that it was unsafe to get rid of the water-ballast
after the ship had started. Speaking broadly,
Doxfords' investigations had shewn the reason
for such unsafeness and its direct relation to
the shape of the ship. The investigation was
of a technical character. The master could not
himself be expected to make an investigation
leading to a calculated result like this, or to
learn for himself what was implied merely in
the course of ordinary experience. I differ
at this point from what I understand the Lord
President to suggest, and I draw the inference
that the ship was inherently unseaworthy in

by the Lord Ordinary in giving the pursuers the whole of their expenses.

The appeal was admirably argued on both sides, and I wish, before sitting down, again to state the broad reasons which have made me finally feel myself compelled to prefer the argument of the appellants.

These reasons are as follows: The vessel was unseaworthy in that she could not safely undertake a voyage with a cargo of an approximately homogeneous character unless she had, and retained, at least 290 tons of water in her lower tanks. That this was her indisputable condition for safety is not the less true because she, and vessels resembling her in shape and construction, had successfully made a certain number of voyages with a full cargo, and without this minimum ballast required. To be put about under a rapid action of the helm is what in the case of every vessel that undertakes a long voyage may be necessary, and in the case before us the operation is proved to have been a dangerous one for a turret ship without sufficient ballast. The inherent danger was one which a master not specially instructed might well overlook. Even a long experience might chance not to reveal it. It was a danger, however, which scientific calculation could

precautions were taken, which it was the duty
of the owners to enjoin as being required by
the structure of their ship.

I am therefore of opinion that the appeal
must be allowed.

66

Lord Atkinson. It having been admitted that the Clan Gordon" was not by reason of want of stability unseaworthy when she left New York Harbour, the main questions for decision in this appeal are whether the neglect of her owners to communicate to the master the contents of the document No. 141 of process rendered him incompetent to navigate his ship laden as she was, and therefore rendered that ship unseaworthy, and whether the owners had exercised the due diligence to make the ship seaworthy. The appellants filed the following pleas in law :

1. The defenders, having failed to carry and deliver the pursuers' said cargo in terms of their contract, are liable in damages.

2. The sum sued for being the loss to the pursuers caused by the said breach of contract, decree should be pronounced in terms of the conclusions of the summons.

3. The "Clan Gordon" having been sent to sea in an unseaworthy condition, and the pur

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