Marine Adventure. Obligations of Merchant and Shipowner
Obligations of a shipowner and a merchant regulated by the common law rules were mutually absolute – the former shall reach place or places named in contract, there load the goods and deliver them to the receiver. The latter shall provide for the goods and pay freight. Read also Common law duties.
The law of contract regulates performance of obligations which the parties have chosen to impose on themselves in the course of their commercial relations. Most of general principles of English law of contract were developed in the eighteenth and the nineteenth centuries on the rise of public interest to the philosophy of laissez-faire, accordingly the courts saw their role mainly in holding the parties to their bargain as provided in contract. Contacts of sea carriage were no exception to this rule (read more on absolute contracts here).
Absolute duties were subject only to few exceptions such as acts of God or King’s enemies and perils of the sea. Generally speaking, only total loss of the vessel excused the shipowner from fulfilling his contract, in which case, unless he managed to tranship goods to destination, the owner was not entitled to any payment for the services done before his vessel become a total loss, same as contractor who performed his contract in part but was not able to finish it without fault of his own, as Blackburn J held in Appleby v Myers (1867) L. R. 2 C. P. 651:
The case is in principle like that of a shipowner who has been excused from the performance of his contract to carry goods to their destination, because his ship has been disabled by one of the excepted perils, but who is not therefore entitled to any payment on account of the part performance of the voyage, unless there is something to justify the conclusion that there has been a fresh contract to pay freight pro rata.
Thus leaving the parties to regulate their commercial relationships within strict limits of self-imposed contractual obligations the courts were frequently called to consider cases where no provisions were made in contract for certain events which, when happened, considerably changed apportionment of liabilities between the sides, or in instances where a contract, if followed to the letter, would lead to such irrational results that it was absurd to suppose that two commercial men entered into a contract to pursue it to this end. In this connection it is worthy to mention that ‘safe port’ warranty, same as many other shipping and insurance law terms which emerged during the era of industrial boom of the nineteenth century, was being developed under the strong influence of principles of mercantile reasonableness and business necessity.
Harshness of an absolute obligation to reach the named place, imposed on the shipowner was recognised by the lawmakers, but this duty was thought to be compensated by a counter obligation of the charterer to handle the particular ship and provide the goods at the place she reaches. Bramwell B expressed this dilemma in Bastifell v Lloyd (1862) 1 H & C 388 at p.394:
At the trial I was struck with the hardship of making the shipowner responsible for the condition of a particular wharf; but the charterer is responsible for the condition of the particular ship, and it was by the conjoint condition of the wharf and ship that the latter was prevented from getting alongside the wharf.
Origins of the warranty go back to the middle of the nineteenth century and disputes over the standard provision in the contracts of carriage stipulating geographical limits of final destination with qualifying words ‘as near thereto as she might safely get’. This qualification served to mitigate the rigidity of the bargain by permitting the charter-party to be performed under the concept of a secondary destination, when due to natural factors such as tides and insufficiency of water vessel was not physically able to reach her final destination stated in the contract.
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