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Nippon Yusen Kaisha Vs. Mahali Ram-ranjidas and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1931Cal269
AppellantNippon Yusen Kaisha
RespondentMahali Ram-ranjidas and anr.
Cases ReferredIn Folke v. Fletcher
Excerpt:
- rankin, c.j.1. the appellants, nippon yusen kaisha, are ship-owners, and we are concerned with two vessels moji maru and hakata maru which sailed from calcutta in may and june respectively of 1926. the claim against the appellants is for the value of 325 bales of gunny bags, as damages caused to the plaintiffs, by the wrongful conduct of the appellants in issuing bills of lading for those bags to the international export company, limited, and delivering them at kobe to the order of this company. each bale contained 400 bags.2. by a contract in one of the forms of the indian jute mills association, the plaintiffs on 27th january 1925, had bought a large quantity of gunnies from the lansdowne mills for delivery in april, may and june of that year. by another contract in similar terms they.....
Judgment:

Rankin, C.J.

1. The appellants, Nippon Yusen Kaisha, are ship-owners, and we are concerned with two vessels Moji Maru and Hakata Maru which sailed from Calcutta in May and June respectively of 1926. The claim against the appellants is for the value of 325 bales of gunny bags, as damages caused to the plaintiffs, by the wrongful conduct of the appellants in issuing bills of lading for those bags to the International Export Company, Limited, and delivering them at Kobe to the order of this company. Each bale contained 400 bags.

2. By a contract in one of the forms of the Indian Jute Mills Association, the plaintiffs on 27th January 1925, had bought a large quantity of gunnies from the Lansdowne Mills for delivery in April, May and June of that year. By another contract in similar terms they resold 3,20,000 bags to the International Export Company Limited which is now in liquidation. The sale in each case was

free alongside export vessel in the port of Calcutta,

and both contracts contained the following clauses:

(3). Payments to be made in cash in exchange for delivery order on sellers, or for railway receipt, or for dock receipts, or for mate's receipts, which dock receipts, or mate's receipts are to be handed by a dock's ship's officer to the sollers' representative.

(4). The buyers hereby acknowledge, that so long as such railway receipt, or mate's receipts whether in sellers' or buyers' mime, are in the possession of the sellers, the lien of the sellers, as unpaid vendors, subsists both on such railway receipts or dock or mate's receipts and the goods they represent until payment is made in full.

3. Contracts in this form are well known in Calcutta and export business in gunnies is in Calcutta conducted entirely or almost entirely under such contracts. This circumstance gives considerable importance to the question which we have to decide.

4. In accordance with the usual course of business the Export Company booked freight with the appellants and obtained shipping orders which stated:

Customs passes must accompany this shipping order and the receipts of cargo issued by the ship must be exchanged for bills of lading.

5. The Export Company issued shipping instructions to the plaintiffs who conveyed thorn to the Mills. The Mills sent the goods alongside in lighters producing to the ship's officer, in addition to the customs passes, a boat note for each lighter signed by the manager of the Mills and saying:

Please receive on board from the Lansdowne Jute Mills the undermentioned goods shipping documents for which have been taken out in the name of Messrs. International Export Company Limited and hand mate's receipt to our Sircar.

6. On receipt of the goods the Chief Officer of the ship issued mate's receipts:

Received on board the Nippon Yusen Kaisha steamer Moji Hakata Maru for conveyance to Kobe from Messrs. International Export Company Limited the undermentioned goods subject to the terms and conditions of the company's bill of lading.

7. The dates and particulars appear from the tabular statement appended to the judgment. For the bales now in question five mate's receipts were signed, three by the Moji Maru for 175 bales between 17th and 19th May, and two for 150 bales on 21th by the Hakata Maru. Bills of lading were issued to the Export Company for the Moji Maru on 18th and 19th May and for the Hakata Maru on 25th May. The former sailed .on 19th May and the latter on 4th June. At the time that the bills of lading were issued by the gentlemen in charge of the Export Department of the appellant's Calcutta Office, the Export Company were not in possession of the mate's receipts and a letter of guarantee was taken from the Export Company by the appellants in the following terms:

In consideration of your signing bill of lading for the undernoted goods without the mate's receipt which has not been received by us, we hereby guarantee to produce the same within two weeks and hold you harmless.

8. Very soon after the receipt of the bills of lading the Expert Company negotiated them for value with the Bank of Taiwan.

9. The plaintiffs had received invoices in good time from the Landsdowne Mills but did not pay for the goods until 27th and 29th May and 7th June for the Moji Maru and Hakata Maru respectively and on those days obtained the corresponding mate's receipt.

10. After the bills of lading had been issued and negotiated namely on 29th May 1926, the plaintiffs sent to the appellants a notice of lien stating that

for the protection of such lien or claim we are entitled to retain the relative mate's receipt and that accordingly the bill of lading, on which also we claim a lien, must not be issued nor may the said goods be delivered to any persons whomsoever unless and until such relative mate's receipt be previously surrendered to you.

11. On the same date the appellants replied that the bills of lading had already been passed and signed under the shippers' letter of guarantee and asked the plaintiffs to take up the matter with the shippers. On 3rd June the plaintiffs' solicitor wrote to claim that the appellants are liable for wrongful dealing and conversion of the bales, having wrongfully handed over the bills of lading to the Export Company. He also forwarded a copy of a letter written to the Export Company in which a claim is made that the plaintiffs were the owners of the bales, that they were entitled to a lien thereon and to damages for conversion thereof. On the same date the appellants replied that the bales were sent before the receipt of the lien notice of 29th May and were therefore legally handed over to the shippers. On 4th June the plaintiffs' solicitor repeated the claim stating:

You know fully well that the mate's receipts wore being held by my clients by virtue of their contract with the shippers.

12. To this the appellants replied that they are not in a position to know of any contract between the sellers and the shippers or anything passing between them. On 9th June the plaintiffs' solicitor claimed immediate payment of the value of 325 bales, and on 11th the appellants repeat that they are not liable. On 18th the suit was commenced against the Export Company and the appellants claiming, inter alia, an injunction restraining the defendants from disposing of the goods in any way or delivering them to a third party. On 28th June an application was made for an interlocutory injunction and an interim injunction was granted; but after a few days, as it appears that the vessels had probably arrived at destination, and that the goods had been delivered, an interlocutory injunction was refused and the injunction granted ad interim was dissolved. In a written statement delivered on 14th July it was stated that the goods had been delivered to the holders of the bills of lading.

13. The question is whether in these circumstances the appellants as ship-owners, are liable to the plaintiffs for the value of the goods. It is of importance to consider the state of mind of the appellants and the knowledge or notice which they had of the fact that the contract between the plaintiffs and the Export Company, which was the contract in general use, gave to the sellers a right of lien so long as the mate's receipts were in the sellers' possession.

14. The learned Judge has held that on 14th May the plaintiffs' brokers gave express verbal notice to the shipping company of the fact and nature of the plaintiffs' interest in the goods. Witnesses were called before him as to what transpired at this interview. That there was an interview on 14th May between the brokers on the one hand and Messrs. Awoki and Kimura of the appellant's Calcutta office on the other is not disputed. It seems that a criminal charge had been brought against the firm of Osman Jamal in connexion with the issuing of bills of lading without production of mate's receipts. The brokers Gulazarilal and Phulchand say that they went to the appellants' office, explained that they were interested in certain goods sold by their own firm of Ramjihan Sarowgee and were interested also on behalf of the plaintiff's goods, that they gave full particulars of the case, and with reference to these goods made it clear that any failure to insist upon mate's receipt would deprive the sellers of the benefit of their lien. According to them the main purpose of the interview was to get an assurance from the appellants' office that no bills of lading in the absence of mate's receipts would be issued in respect of the goods with which they were concerned. Messrs. Awoki and Kimura say that the interview, which was extremely short, consisted of the brokers coming to Mr. Kimura's table and asking as to the practice as regards mate's receipts and bills of lading, that no mention was made of any particular goods. but that the enquiry was a general enquiry with reference to the counts of business. They say that it was explained that bills of lading were usually issued against mate's receipts, but that sometimes they were issued in the absence of mate's receipts upon a guarantee. The learned Judge has come to the conclusion that the brokers' story is in substance correct. He says that in his view the probabilities are in favour of the plaintiffs' case. Thinking that the course of dealing between the appellants and the Export Company shows that the appellants had been unduly lenient to them and to have shown a remarkable toleration of their business methods giving them greater facilities than other shippers, he is not much impressed with (ho contention of the appellants that they would not have issued the bills of lading if any such notice had in fact been given.

15. It is difficult for a Court of appeal on such a question of fact to differ from the finding of the learned Judge who has seen the witnesses. We are somewhat embarrassed by the circumstance that in Appeal No. 2 of 1930, which is also at the present time before us, another learned Judge on the evidence of the same witnesses has come to a contrary conclusion. However unfortunate it may be that the same Court should have to accept contradictory findings upon exactly the same question of fact, we must I think deal with each case in complete separation from the other.

16. In the present case however I think we are obliged to examine the reasons given by the learned Judge for this finding of fact with some care. There is some evidence to warrant the conclusion that a notice of lien would not necessarily have prevented the appellants from issuing the bills of lading to the Export Company against a guarantee, but I am satisfied that this would not have boon done save after a very special bargain and, that if the story told by the brokers be true, it is very unlikely to have happened. Further, if the real intention of the brokers was to give notice with reference to a particular consignment it is remarkable that the ordinary method of giving written notice of lien, a method which the plaintiffs had adopted in previous cases should not have boon known to them and adopted in this case. But the learned Judge has not adverted to the main consideration upon this question of fact. When, on 27th May 1926, the brokers, in respect of their own consignment sent the ordinary written notice of lion, no reference whatever is made to any earlier notice. On the next day the appellants write that the bills had boon signed on the shipper's own letter of guarantee. One would certainly have expected that in these circumstances the reply to this letter would contain a statement as to the notice given at the interview and an emphatic complaint that it had been disregarded. The appellant's letter of the 28th is replied to by the brokers' solicitors and it is manifest that the brokers, though they had taken the trouble to instruct solicitors, had not mentioned to them that at an interview on 14th May express notice had been given. This letter complains that instead of following the usual and correct custom of issuing a bill of lading only on production of the mate's receipt, the appellants had at their own risk issued the bill of lading to the brokers' purchasers. Nor do the brokers, though it is improbable that they should not have heard that their principals (the plaintiffs in the present case) were companions in misfortune, give to the plaintiffs any information which would induce them to make a point as to what happened at the interview. So late as 8th June 1926, the brokers' solicitors return to the charge without mentioning this interview and on 10th June the appellants' manager insisted that the bills of lading were issued in the absence of your clients' lien notice.' The broker's suit was brought on 12th June and contains no statement of oral notice. There was a petition for a receiver on 16th June and affidavit in answer on the 18th by Mr. Kimura.

17. It is not until 21st June, in an affidavit in reply, that there can be found any trace of a suggestion that something said on 14th May affects the matter. The terms of para 3 of that affidavit are much more like the interview as spoken to by the appellants' witnesses in this case than they are like the evidence given by Gulzarilal and Phulchand, while Mr. Kimura's affidavit on 23rd June shows that he at once put on oath the story which ho gave before the learned Judge. Now I regard these documents, of which the learned Judge has made no mention as convincing proof which displaces altogether the credibility of the story told by Gulzarilal and Phulchand, and with the greatest respect to the learned Judge, I am of opinion that this case cannot be decided on the basis of an express oral notice given on 14th May.

18. It is on the other hand reasonably plain upon the evidence that the Export Company, which was constantly asking the appellant's Calcutta office for bills of lading to be given at a time when mate's receipts were outstanding with their sellers, and which was getting this facility in each case upon the terms of a letter of guarantee, and which was being placed to get in the mate's receipts and return them to the appellants in exchange for the letters of guarantee was doing something perfectly well understood by those in charge of the appellant's office. It may or may not be that in law it makes no difference whether they understood it or not, but it is idle for Mr. Kimura and Mr. Awoki to pretend that the difficulty which the Export Company experience in getting in the mate's receipts was a difficulty of whose nature and conditions they were not fully cognizant. It was just here that the usual, if not invariable, terms upon which gunnies were bought and sold in Calcutta, under the standard contracts of the Indian Jute Mills Associations, impinged upon their business as ship-owners: and they would be skilfully ignorant indeed if they entertained any vague delusions about the matter. Mate's receipts to any shipowner import the chance of liability, to put it no higher, and the mere fact that letters of guarantee were religiously taken and afterwards returned, makes it certain that the appellants were providing for themselves a refuge in case of claim by a seller.

19. It is quite true that a lighter man or anyone else may lose a receipt or may drop it into the water, or that it may be otherwise lost or destroyed by accident. Such cases however would be few and the facts as to them would come to light and it would be the shipper's business and interest to give special explanation. The more circumstance that in the boat note the Mills asked that the mate's receipt should be handed over to their sircar proves nothing of itself. It would be quite consistent with the Mills having been previously paid and having sold to the shipper direct. But the constant receipt by the appellants of lien notices is of itself a fact inconsistent with the suggestion that the appellants when, in the absence of a lien notice, they insisted on letters of guarantee were unaware of the nature of the claim to which they might be exposed.

20. Having regard to the contract and the shipping instruction given, I think it reasonably plain that when the goods were delivered alongside the vessel, or very shortly thereafter, the general property in the goods passed to the buyers [under S. 83, Contract Act. It has been contended for the plaintiffs that by reason of the retention of the mate's receipt the goods were not unconditionally appropriated to the contract as the sellers reserved jus disponendi over them; but this argument seems to me to be ill founded. The contract in this case regulates the matter and clearly the intention that the right of the seller shall be a vendor's lien imports that the property passed. On this point I would refer to the judgment of Sale, J., in Juggernath Augurwallah v. E.A. Smith [1906] 33 Cal. 547 and on appeal [1907] 34 Cal. 173.

21. Again it was contended for the plaintiffs that the words 'from Messrs. International Export Company Limited' in the mate's receipt do not import that the mate's receipt is taken in the name of the company, so as to be a recognition of property in the company or an acknowledgment that the goods are to be held by the ship on its account. I think however that the intention from the first was to deliver to the ship on account of the Export Company in whose name, as the shipping instructions and the boat notes both assert, shipping documents had been taken. This in my judgment is a very important feature of the present case. The system under which by contracts in the form before us, a series of intermediate dealers is interposed between the mills on the one hand and the ultimate shippers on the other would seem to require, if the mate's receipt is to operate as a security to each buyer against his seller's default in making payment that the older and more usual form of mate's receipts in which no owner's name is mentioned should be employed. In that case it would seem to be clear that up to the time when the bill of leading is issued, the ship holds the goods for the person entitled to the mate's receipt and until the ultimate shipper has became entitled thereto he cannot claim prima facie that the ship is holding on his account. The real difficulty in the present case is created by the fact that with the consent of and by the active representations of the plaintiffs and the mills, these goods were delivered to the ship on terms that the ship was to receive and hold for the Export Company the contract between the parties being inconsistent with this state of affairs. As between the parties the ship was to hold for each seller as against his buyer as between the parties and the ship. The ship in the case before us, was to hold for the Export Company. I regard this as a matter of some importance upon the 'question whether the ship-owners can be said to have acted wrongfully or negligently in delivering the bills of lading to the person on whose account the goods had been placed with them by the plaintiffs and their suppliers. There is much force in the contention that as the plaintiffs and the mills had accepted mate's receipts in the shipper's name, the ship was entitled to act upon the footing that they at all events, unless they gave express notice to the contrary, could not complain against the ship for carrying out their own instruction. If the course of business between the parties was consistent with the position which they had adopted vis a vis the ship, it is not clear that the shipowner would be justified, from a general knowledge of the course of their business, in refusing to issue bills of lading to the person from whom he had been expressly asked to receive the goods. The requirement that mate's receipts should be produced before bills of lading could be issued is a requirement made and inserted in the shipping order in the interest of the ship-owner. The production of the mate's receipt is a very necessary condition if the ship-owner is to be asked to issue bills of lading to a person other than the person named in the mate's receipt.

22. It is also useful as a protection to him in case the shipper named in the receipt is acting for a principal in which case the principal may have possession of the receipt intending to take bills of lading himself. It is therefore a very good advice to a ship-owner that he should insist wherever possible upon the production of the mate's receipt because this is some protection to him against being put in the invidious position of being called upon by two rival claimants to deal with the goods as they direct. It cannot however be said in my judgment that the issuing of the bills of lading in the circumstances of the present case was in itself a wrongful act or amounts on the part of a carrier to a conversion of the goods. Where a bailee or carrier deals with goods entrusted to him (his intention is material to the question whether he converts them because a dealing with them in the ordinary course of business manifests of itself no intention to deny the owner's title or to intermeddle or interfere with the title of anyone but if A is the real owner of the goods he may demand them from the carrier and if the carrier does not interplead but sets up the title of his bailor, he must prove such title or be liable to the owner for the value of his goods.

23. In the present case the plaintiffs put their cause of action as arising on 29th May when they claimed the goods ten-days after the Moji Maru had set sail saying that the bills of lading should be given to them. If at that moment the plaintiffs had a right to possession of the goods, it is in my judgment reasonably clear that there was a demand by them followed by a refusal by the appellants. But it seems to me to be another question altogether where the appellants were not within their rights in issuing the bills of lading to the Export Company notwithstanding their knowledge that by the general course of business the very people who had delivered the goods to the ship to hold them on behalf of the Export Company, had, or very probably had, an arrangement between themselves and the Export Company to. the effect that the ship was to hold for the seller as against the buyer. They knew after all that the plaintiffs had not chosen to give the usual notice of lien and if they were content to take the risk and trouble involved in rival claims being made thereafter it is difficult to say that their action was unreasonable.

24. I cannot say that any of the cases which have been cited to us are very close to the present but some assistance may perhaps be derived from the cases of Cowasjee v. Thompson [1845] 3 M.I.A. 422, Hathesing v. Laing [1873] 17 Eq. 92 and Natheappa Chetty v. Irrawaddy Flotilla Company [1913] 41 Cal. 670. In Cowasjee's case the bill of lading was given to the person who was entitled to mate's receipt so that ease proves very little. In Hathesingh's case the facts, as ultimately proved would seem to be that the mate's receipt was produced to the Master at the time he signed the bill of lading to the person named therein; but discussing the case upon the footing that the mate's receipt had not been so produced and that the only-claim of the brokers was founded upon an alleged endorsement of the mate's receipt, of which no notice had been given to the ship, Vice-Chancellor Bacon refused to accept the proposition that Captains or Masters of ships are bound to have mate's receipts returned to them before they signed any bills of lading for the goods mentioned in such mate's receipts. In that case however there were no circumstances, known to the Captain, which could have led him to suppose that although the brokers had put the goods on board in the name of their principals the absence of the mate's receipt was due to a claim made by the brokers on the goods.

25. It seems to me to be going too far having regard to the well known practice that bills of lading are issued before the ship sails, a practice which is essential to the ordinary course of business to hold that a person who has himself directed the ship to hold the goods for shipment on behalf of A should be allowed on waking up ten days after the date of sailing to treat as wrongful the [carrying out of his own instructions in the absence of anything done by him to countermand the same in good time. A ship nowadays must either give bills lot lading for the goods or refuse to sail with the goods at all. Hence for myself I should want clear authority for such a proposition. In Craven's case [1886] 6 Taunt. 433 where it was said that the fact that the mate's receipts were taken in the plaintiff's name made no difference to the decision, the bills of lading notwithstanding this fact and notwithstanding the mate's receipt wore held by the plaintiff, had been issued to another. In Schuster v. Mekellar [1857] 7 E. & B. 704 the mate's receipts wore in the old form; they did not contain the plaintiff's name; the bills of lading were issued to the plaintiff's buyer without production of the receipt. In Folke v. Fletcher [1865] 18 C.B.N.S. 403 the Captain refused to give bills of lading to the shipper and set up the title of another person to the goods. But the special features of the case before us: (1) That the bills of lading were issued to the person mentioned as the shipper in the mate's receipt; (2) that the claim is by the person who had accepted this form of mate's receipt from the ship; (3) that the mate's receipts were not exchanged against the bills of lading; (4) that the plaintiffs had given no notice to the ship that it was not entitled to hold for the person mentioned in the mate's receipt; (5) that the ship-owner's general knowledge gave him reason to think it probable that as between the plaintiffs and the Export Company the plaintiffs had a claim to possession of the goods; (6) the evidence in this case is sufficient to show that the practice of prudent and reasonable men is to give written notice of lien: (7) it is also sufficient to show that prudent and reasonable ship-owners act from time to time as the appellants did. Although it seems to me reasonably clear that if the mate's receipts had not been given as an acknowledgment that the ship held on behalf of the Export Company the result would be very different, I am not prepared to hold that in this case the action of the ship-owners in issuing the bills of lading to the Export Company was a wrongful act of which the plaintiffs can complain.

26. In this view I approach the plaintiffs' case which is that their demand made on 29th May and the ship's refusal thereon made the appellant liable to them for the value of the goods. Now, we know from the plaint itself that before 29th May the bills of lading had been endorsed by the Export Company to the Bank of Taiwan. If this endorsement gives to the Bank of Taiwan a better right to possession of the goods than the plaintiffs had, the appellants, if I am so far right, committed no wrong by refusing to treat the goods as deliverable to the order of the plaintiffs.

27. If, as between the plaintiffs and the Export Company, the right to the goods was in the plaintiffs, the endorsement of the bills of lading by the Export Company would not in it self defeat the plaintiffs' right, nor is it so contended on behalf of the appellants. But it is said that just as a person can under the Factors Acts in England give a better title to another than he has himself. so under Section 178, Contract Act:

A person who is in possession of any goods or any bill of lading dock warrant warehouse keeper's certificate wharfinger's certificate or warrant or order for delivery or any document of title to goods may make a valid pledge of such goods or documents provided that the pawnee acts in good faith and under circumstances which are not such as to raise a reasonable presumption that the pawner is acting improperly provided also that such goods or documents have not been obtained from the lawful owner or from any person in lawful custody of them by moans of an offence or fraud.

28. As the appellants delivered the goods to the order of the Bank of Taiwan it is clear that it would be open to them in the circumstances of this case to set up the title of this Bank as derived from but bettor than the title of their own bailor. notwithstanding that much expense and great industry have been expended in the defence of this case, the appellants do not in their written statement and have not by their evidence raised or proved this defence at all. Before us the learned Advocate-General for the appellants complained that the plaint was not so framed as to make his clients aware that they would be charged with conversion of the bails. This contention is I think quite impossible and I have no doubt at all that we must deal with his application to be allowed to amend and to give further evidence raising this defence upon the footing that his clients have on this point no real excuse. In my opinion this application should be rejected.

29. The next question is whether the plaintiffs were entitled to claim these goods from the appellants and required them to be held for the plaintiffs or delivered to the plaintiffs, at Kobe. That the plaintiffs did so require and that the appellants refused before 18th June 1928, when this suit was brought is I think reasonably clear. The plaintiffs sued before the goods had been 'delivered, but before an interlocutory injunction could be obtained, delivery had been made at Kobe. The facts as to this are not made precise by the evidence but the learned Advocate-General for the appellants has informed us that according to his instructions the goods were delivered to the order of the Bank of Taiwan between 20th and 30th of June. It is quite true that the plaintiffs must have a cause of action on the date when they instituted the suit but the conduct of the appellants in the days immediately following the institution of the suit may well be evidence that their conduct between 29th May and 18th June was a refusal of the-plaintiffs' claim thereto. It is abundantly clear to me that they did so re-fuse and that they set up and stood by the title of the Bank of Taiwan. Were the plaintiffs then on 29th May entitled to require that the appellants should treat them as the persons entitled to possession of the goods? In my judgment they were. By this time the plaintiffs-held the mate's receipts and by their agreement with the Export Company to whom the general property in the goods had passed the delivery to the ship was not a completed delivery to the Export Company and the plaintiffs were entitled to the possession of the goods. The Export Company could not as against the plaintiffs set up their own wrong in respect that they had taken the bills of lading or authorized the vessel to sail with the plaintiffs' goods on board thereby terminating the plaintiffs' lien. Apart from Section 178 their assignees were, in no better position.

30. It is not necessary to discuss whether the plaintiffs' position at any time before 29th May entitled them to complain of the conduct of the appellants and if so whether the ordinary action in trover would have been applicable to their case. Nor is it necessary to discuss nice questions about vendors' liens. If the ship was holding on behalf of the Export Company it was in my judgment open to the Export Company to. agree with the plaintiffs that the possession of the ship should as between themselves be the possession of the plaintiffs just as it would be open to a buyer to agree to hold goods as agent for the seller until a certain event had happened to entitle him to hold them in his own right. If goods in the possession of a carrier on behalf of another are wrongfully put on board a vessel and the vessel innocently accept them in the ordinary course of business I take it to be clear that the carrier would be entitled to demand the goods. There are dicta in the older cases to the effect that to maintain trover there must be a right of property as well as a right to possession but it has often been pointed out that this requirement does not operate to exclude such actions by bailees or carriers or by unpaid vendors whom the law regards as having a special property. On the facts of this case the plaintiffs can recover the full value as damages whether they put their claim in trover or in trespass.

31. On this view the appeal fails in substance. I observe however that by the decree the plaintiffs are to recover Rs. 72,150 against both defendants the Export Company and the appellants. It is said in the decree that the plaintiffs are to recover this sum against the Export Company as price of the goods and are to recover the same sum against the appellants as damages. It. is somewhat confusing to a simple mind to be told that the plaintiffs can recover the price of their goods from their buyers and at the same time recover the value of the goods from another party on the ground of conversion thereof. So far as the appellants are concerned they would be liable to the plaintiffs for the value of the goods at the date of refusal, that is on some date immediately after 29th May. It would appear from Ex. QQ that the market rate had gone down below the contract rate. As the Export Company has not appealed, we are not obliged to alter the decree in their favour.

32. In these circumstances the decree should be varied by deleting therefrom the explanatory clause in brackets which follows upon the mention of the sum of Rs. 72,150 where that sum is first mentioned in the decree and judgment should go against the appellants and the Export Company for the goods at the end. of May, the difference between that sum and the figure of Rs. 72,150 being awarded against the Export Company alone as additional damages due to the plaintiffs for the Export Company's refusal to accept and pay for the goods.

33. Both parties have contended that the Carriage of Goods by Sea Act (26 of 1925) assists them but I have not been able to see that it affects the matter.

34. It is agreed by learned Counsel before us that the last figure in Ex. QQ that Rs. 49-4-0 shall be accepted as the measure of damages against the appellants on the basis of this judgment of course, without prejudice to any right of appeal that either party may have. It does not appear to me that this point about the amount of damages should be allowed to affect the cost of this appeal. But the appellants ought to have their costs in both Courts of the issue as to the interview of 14th May. Save as above mentioned the appeal will be dismissed with costs.

C.C. Ghose, J.

35. I agree in the judgment delivered by my Lord, the Chief Justice.

Williams, J.

36. The facts and arguments have been stated fully by my Lord, the Chief Justice, and I need not repeat them.

37. I defer from my learned brothers with regard to one only of the conclusions to which they have come. In my opinion the ship-owners were not justified in handing the bills of lading to the Export Company without production of the mate's receipts.

38. Possession of the mate's receipt is prima facie evidence of ownership. The holder is entitled to a bill of lading in exchange in the absence of notice to the ship-owner that the holder is not the owner.

39. The ship-owner may sign the bill of lading without production of the mate's receipt, but he does so at the risk of delivering the bill to some one who is not the owner, or who is not entitled to the bill of lading.

40. I am satisfied from the evidence in this case that the shipping company had full knowledge of the terms upon which the gunny trade is carried on in the port of Calcutta and that they knew or ought to have known when they delivered bills of lading to the Export Company without production of the mate's receipts, that there was a very strong probability that the Export Company were not then entitled to the bills, and that in so delivering them they wore running a risk that the Export Company might never become so entitled. To insure against this risk they took the letters of guarantee.

41. Even if it were open to the appellants to raise the point under Section 178, Contract Act, such a contention would not help them. As against the plaintiffs' claim the appellants cannot set up a title in a third party which was created, if at all as a result of their own wrong doing.

42. For this reason I agree that this appeal must be dismissed.


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