THB AUGUST-SYLLABUS.

We have attempted to state the main considerations upon which the Supreme Court will base its decision, whenever and on whichever side the decision is reached. In such a region of mingled law and politics it seems im- possible to do more. New York, February2, 1892.

NOTE. Since the preceding article was put in type, the Supreme Court has handed down a decision affirming the validity of the McKinley Act in this respect among others. The opinions are not yet at hand. Chief Justice FULLER and Mr. Justice LAMAR appear to take the view main- tained here, while the rest of the Court, speaking by Mr. Justice HARLAN, consider that the President is not vested by the act with any real legis- lative power, but is left to ascertain that a particular fact exists. Until the opinion of the Court is handed down in full, it will be difficult to say in what cases legislative discretion may hereafter be held to bd delegated. -E.B. W.

HIGH COURT OF JUSTICE- DIVISION. THE AUGUST.

SYLLABUS. A German vessel, loading at Singapore for , took on board, with other cargo, a quantity of pepper shipped by British subjects, un- der English bills of lading in the usual form. On the voyage, heavy weather was experienced, and the vessel put into a port of distress, both the ship and portion of the cargo being damaged. The master tele- graphed to this effect to the ship's agent at Singapore, and the contents of the telegram were communicated to the various shippers, but no in- structions were received by the master. Thereupon the master, acting in good faith on the best advice he could obtain, and believing it to be for the benefit of the cargo-owners, sold, with other cargo, a considerable portion of the pepper, much of which might have been reshipped, and some of which was, in fact, sent on by the purchasers in other vessels to London, where it fetched substantially the price of sound pepper. In an action for breach of and conversion, brought by the plaintiffs, who were the consignees of the whole, and the purchasers of part of the pepper so sold by the master: Held, that the defendants, the owners of the vessel, were not liable, as the law of the flag must be looked at to determine the propriety of the sale, and by German law the conduct of the master was justifiable. Action for non-delivery of goods. The facts are as stated in the syllabus. OPINION OF THE COURT.

OPINION OF THE COURT. SIR JAMES HANNEN, President, after stating the na- ture of the action, proceeded: This action is brought in respect of the pepper sold at Cape Town as damaged, it being contended further for the plaintiffs that such sale was not necessary or justifiable. The defendants pleaded that the August was "a Ger- man vessel, and entitled to fly the German flag, and to all- the privileges of a German ship; and that the defendants and charterers of the said ship were German subjects, resi- dent in Germany; and that the master was a German sub- ject; and that the charter party was a German contract; and that the contained in the bills of lading for the carriage of the said pepper were made and entered into subject to German law; and that by the German law . . . the sale of the said goods was lawful and right." The question raised by this plea was first argued before me, it being agreed that the other questions arising in the case should stand over until I had -determined whether the propriety or impropriety of the conduct of the captain in selling the pepper alleged to be damaged was to be determined by English or German law. The broad distinction suggested to exist between the English and German law on the subject under considera- tion is, that by the it is not sufficient to justify the sale of the goods at a port of refuge, that the captain acted in good faith and in the exercise of the best judgment he could form, if it should be held by the tribunal before which the question may come that there was not in fact a real necessity for the sale; whereas, by the German law, the sale will be justified if the captain, after taking the best advice he can obtain, honestly comes to the conclusion that a sale is best for the interests of the persons for whom he is called upon to act in the emergency which has arisen. This is not given as a complete statement of the Ger- man law on the subject, but merely as an indication of the nature of its difference from the English law for the pur- poses of the present inquiry. THE AUGUST.

The argument for the defendants is based on the prin- ciple laid down by the Court of Exchequer Chamber in Lloyd v. Guibert,' that where the contract of affreight- ment does not provide otherwise, as between the parties to the contract in respect of sea damages and its incidents, the law of the country to which the ship belongs must be taken to be the law to which they have submitted themselves. In the very learned judgment in that case, delivered by WILLES, J., on behalf of the Exchequer Chamber, he says p. 129): "Exceptional cases, should they arise, must be dealt with upon their merits. In laying down a rule of law, regard ought rather to be had to the majority of cases upon which doubt and litigation are more likely to arise; and the general rule, that where the contract of affreight- ment does not provide otherwise, there, as between the parties to such contract, in respect to sea damage and its incidents, the law of the ship should govern, seems to be not only in accordance with the probable intention of the parties, but also most consistent and intelligible, and, there- fore, most convenient to those engaged in commerce." This subject has since been very fully considered by the Court of Appeal in the case of the Gaetano and Maria.' In that case goods were shipped by British subjects under a charter party made in London for the carriage of goods to in an Italian ship. The ship put into Fayal in distress, and the master entered into a bottomry bond, by which he hypothecated the cargo as well as the ship without communicating, as he might have done, with the cargo-owners, but which, by the Italian law, he was not bound to do. The question was whether the captain was bound by the English law, by which he had no authority to bind the owners of the cargo without communicating with them; or by the Italian law, under which such com- munication was unnecessary. The present , in giving judgment in that case, says (p. 146): "What is the principle which ought to govern the case? The goods are put on board an Italian ship, and the person to exercise arthority is an Ital-

I Law Rep., I Q. B., 115. 2 Law Rep., 7 P. D., 137. OPINION OF THE COURT. ian master. Is the authority of the Italian master to de- pend upon the law of the country of the shipper, when the law is contrary to the law of his own country? Why should it? Is the master of the ship to be taken to know the law of the country of each shipper of the goods which are put on board his ship? It would be strange if that were so. If a merchant puts his goods into the power of an Italian master on board an Italian owner's ship, what is. the mean- ing of the transaction but that he is to deal with goods on board his ship, unless he is bound to another mode? Upon principle, it seems to me that he who ships goods on board a foreign ship, ships them to be dealt with by the master of that ship according to the law of the country of that ship, unless there is a stipulation to the contrary." And after reviewing the facts of the case of Lloyd v. Guibert,' and pointing out that there the contract was one of affreightment, he continues : " Still, if the contract was there held to be a foreign contract, because it was made with regard to the shipment of goods on board a foreign ship, the principle governs this case, and would authorize our saying that the authority which arises out of the con- tract of shipment is the authority which the law of the country of the ship would give to the master." And COTTON, L. J., thus states the principle applica- ble (p. 149): "When the owner of goods puts them on board a vessel, he must authorize the owner of that vessel, and his agent, the captain, to deal with those goods accord- ing to the law of the country to which that vessel belongs." This "rule is applicable, because no one who ships goods -on board a vessel can be ignorant of the flag-that is, of the country to which the ship belongs-whilst the master would be in a very difficult position if he had to inquire what was the law of the country of the goods if, as regards one por- tion of the cargo, he had power to deal, when the necessity arose, in one way, and as regards another portion of the cargo in another way." This appears to me to be binding authority in the

1 Law Rep., i Q. B., 115. THE AUGUST.

present case, unless a valid distinction can be drawn be- tween the law which is to govern the right of a master to hypothecate cargo and that applicable to his right to sell it in circumstances of emergency. I can find no such dis- tinction, and it will have been seen that the passages I have quoted from the judgments in Lloyd v. Guibert' and the Gaetano and Maria are perfectly general, and apply with equal force to the case of a master called upon in a position of difficulty to deiermine whether he should sell goods as to that of one having to determine whether he should pledge them. It was urged also for the plaintiffs that a later case in the Court of Appeal, the Chartered Mercantile Bank of India v. Netherlands, India, etc., Co., ' modified the de- cision in the Gaetano and Maria and supported their con- tention. I am of opinion, however, that it has no such effect. There is no such suggestion throughout the judgments there delivered that there was any intention to vary the law as laid down in the earlier cases I have cited. There, goods were shipped under a bill of lading containing, amongst other excepted risks, "collision." In the course of the voyage the carrying ship came into collision with another vessel belonging to the same owners, both ships being to blame. It was a question in dispute whether both were Dutch. It was held that, whether they were Dutch or not, the defendants were liable in tort for the negligence of their servants on board the ship with which the carrying vessel collided. This case does not appear to me to throw any light on the one now under consideration. It was held in that case that the contract was English, even though the ship in which the goods were carried was Dutch. Assuming that the contract in the present case was English, that does not govern the question of what law is to be applied to goods carried in a German ship, a state of facts not provided for and not contemplated by the contract hav- ing arisen. Such facts existing, we must consider what

1 Law R~ep., i Q. B., It 5. .2o Law Rep., Q. B. D., 521. THE LAW OF THE FLAG.

law it is just to apply to these exceptional circumstances, and, for the reasons so forcibly stated in Lloyd v. Guibert and in the Gaetano and Maria, it appears to me that the master of the August could only be expected to act in conformity with the law of his flag. Holding, fierefore, as I do, that the captain, in deal- ing with the damaged cargo at the port of distress, was entitled to act in accordance with German law, I pro- ceed to consider what is the German law applicable to such a case. (After reviewing the German law at length, the learnedjudge held that it absolved the master and own- ers of the shi from liability for the sale, and judgment was directedfor the defendants.)

THiE LAW OF THE FLAG. The foregoing case is the latest law of that flag to regulate those * application of that canon of con- contracts, and that they must either struction, commonly designated as submit to its operation or not con- the "law of the flag," which has tract with him or his agent at all." been adopted by the English courts While the rule, thus broadly in cases involving the relations stated, has never been judicially arising from a contract by charter recognized in this country, but, on party or bill of lading, where, either the contrary, has been repudiated owing to the diverse nationality of when it has come before the courts the parties, or other circumstances for consideration, there can be no connected' with the transaction, doubt but that, when a case shall there is no conclusive presumption arise which shall call for its appli- as to the municipal law to which cation within its proper limits, recourse must be had to determine the courts of this country will fol- the rights of the parties. low it. Mr. FoorE, in his work on Private The Nature 'of the Rule.-Un- International Law, page 408, states til within a comparatively re- that the law of the flag is "to reg- cent time the prevailing doctrine ulate the liabilities and regulations was that the recognition and en- which arise among the parties to forcement of a foreign municipal the agreement, be it of affreight- law were based upon. the comity ment or by hypothecation, upon prevailing among nations, and even this principle; that the ship-owner at the present time that theory who sends his vessel into a foreign is not without its adherents. (See port gives a notice by his flag, to remarks of BROWN, in the all who enter into contracts with Brantford City, 29 1ged. Rep., 373. the shipmaster, that he intends the to 383.) THE AUGUST.

The current theory, however, is waiver must be clearly expressed, that the force of a foreign municipal or there will be conclusive pre- law is in no wise due to a spirit of sumption that by reason of their comity, but depends upon the in- allegiance to the government the tention of the parties, which, when parties have consented to be bound ascertained, must be enforced as a by the terms of the law. Where matter of right. Considered as a there is diverse citizenship, no such foreign law, it can have no extra presumption can arise, and the- territorial effect, and none can be question of the intention is an open conferred by comity; but, viewed one. as a stipulation, which the parties Where there is no evidence of the to a contract have impliedly incor- intention, the presumption gener- porated into it by submission to the ally is that the parties intend to law of such foreign country, it oc- submit themselves to the law of the cupies precisely the same position place where the contract is made: as any other provision of the con- P. & 0. Co. v. Shand, 3 Moo. P. tract, and the Court which refuses C. (N. S.), 272 ; the Montana, 129 to enforce such foreign law, un- U. S., 397; Jacobs v. Credit Lyon- less it involves the violation of nais, 12 0. B. D., 589. Lord MANS- the public policy of the country, FIELD thus stated the law in Robin- clearly violates the duty imposed son v. Bland, 2 W. Black, 258 upon it. Substantively, foreign law (176o): "The general rule estab- is exactly what it has always been lished ex comitate et juregentium regarded as a matter of procedure. is, that the place where the con- It is simply a fact. It stands upon tract is made, and not where the the same footing as the contract action is brought, is to be consid- itself. It must first be shown that ered, in expounding and enforcing the parties intended to be bound the contract. But this rule admits by a contract, and, when that is of an exception, where the parties done, the provisions of that con- (at the time of the making of the tract must determine the rights of contract) had a view to a different the parties; and so, when it is kingdom." proved that the parties intended to But in England, at least, the ten- submit to a foreign law, that law dency is, in cases of affreightment, must determine their rights. toward a different presumption. The grounds upon which a for- Mr. ScRUTTON, inhisworkon Char- eign municipal law is enforced and ter Parties, etc., p. ii, after refer- that upon which a local municipal ring to the above rule, says : "It is law is enforced are identical. It submitted that, in the absence of is the consent of the parties in both any express indication of intention instances which entitles the Court as between the parties to a contract to give force to the law. There is of affreightment, there is a strong this distinction, however: where no presumption. in favor of the law of questions of public policy are con- the ship's flag." cerned, it is undoubtedly true that That this presumption is not, in the parties owing allegiance to the England, conclusive is shown by same municipality may waive the the case of the Chartered Mercan- provisions of the local municipal tile Bank of India v. the Nether- law and provide otherwise; but such lands India Steam Nay. Co., io Q. THE LAW OF THE FLAG.

B. D., 521, where an English mer- The first may be subdivided into chant shipped goods at an English those applying to the authority of port to be carried to a Dutch port, the ship-owner, either by way of in a ship registered in Holland and hypothecation or affreightment; carrying the Dutch flag, belonging and, second, the authority of the to a company registered in Hol- master over the cargo. land and also in England as an (i) Effect of the Law of the Flag English stock company. The bill ufion the Authority of the A/aster. of lading was in English. It was (a) To bind ship-owner by way of held in the Queen's Bench and in hypothecation or affreightnient. the Court of Appeals that these facts The exception of bottomry bonds were sufficient to overcome any pre- from the general rule, that the lex sumption in favor of the law of the loc contraclusprevails, seemed ano- flag, and showed that it was the in- malous to the writers on the con- tention of the parties to be governed flict of laws. by the law of England. BRETT, MR. MACLACHLAN, in his treatise L.J., said: "It may be true, in one on Merchant Shipping, published sense, to say that where the ship in I86o, suggested that the explana- carries the flag of a particular coun- tion of this might be found in ap- try,prinidfade the contract made plying the law of the flag of the by the captain of that ship is a con- ship. "The agency that we speak tract made according to the laws of of here is devolved upon him by the country whose flag the ship the law of his flag. The same law carries. But that is not conclu- that confers this authority ascer- sive." tains its limits; and the flag at the Accepting the intentions of the mast-head is notice to all the world parties,theu, as beingthe crucial test of the extent of such power to bind of the law which applies in each par- the owners or freighters by his act" ticular case, it becomes evident that (3 d ed., p. 170). the law of the flag of the ship is no He further says: "Is the for- more than an element, to be con- eigner who deals in his own coun- sidered in conjunction with all the try with this agent bound by that other facts of the transaction in law (of the flagi)? First, he has no- ascertaining the true intention of tice of it, and therefore if he be, the parties. As to its relative there is no injustice. weight in determining this ques- "The notice of which we have tion no inflexible rule can be estab- spoken is to be found in the na- lished. In some instances its pre- tional flag that he hoists on every ponderance appears to be so great sea and sails under into every port. as to amount almost to a conclusive Agents under the municipal laws, presumption. In other cases it may even within the bounds of muni- be outweighed entirely by the other cipal jurisdiction, bear no such facts. public credentials. Moreover, his This rule has been applied in two command on board, the ship's pa- classes of cases: first, those involv- pers, and all the circumstances that ing its effect upon the authority of connect him with the vessel, isolate the master; and, second, those in- the vessel in the eyes of the world, volving the validity of contracts of and demonstrate his relation to the affreightment. owners and freighters as their agent THE AUGUST.

for a specific purpose, and with the rule laid down by Mr. MAC- power well defined under the na- LAcHLIN, holding that the master tional maritime law" (p. 170). had no greater authority to bind the This rnl; was followed, in 1864, ship-owner than was conferred by in the leading case of Lloyd v. Gui- the law of the ship. He said : bert, i Q. B., II5. In that case "We think that, as far as regards the plaintiff was a British subject, the implied authority of the master who had chartered a vessel carrying of a ship to bind his owners person- the French flag, at St. Thomas, a ally, the flag of the ship is notice Danish NVest India island, for a to all the world that the master's voyage from St. Marc, in Hayti, to authority is that conferred by the Havre, London, or Liverpool, at law of the flag; that his mandate the charterer's option. The ship is contained in the law of that was chartered by the master in country, with which those who deal pursuance of his general author with him must make themselves ity. The vessel belonged to acquainted at their peril" (33 L. French subjects, domiciled and J. Q. B., 248). trading in France, and the char- Upon appeal, in the Exchequer ter party in the French lan- Chamber, the decision was placed guage described her as French. upon a broader ground. After A cargo was shipped at St. Marc for an elaborate discussion, it was Liverpool, and the vessel sailed held that neither the English, with it; but she was compelled to Portuguese or Haytien laws had any put into Fayal, a Portuguese port, application, and thatthe considera- in distress, and, in order to repair, tions in favor of the Danish law the master borrowed money upon were outweighed by those in favor bottomry upon ship, cargo and- of the law of the flag of the ship. freight. On arrival at Liverpool The ground of the discussion in the ship and cargo were insufficient the Court of the Queen's Bench, to pay the charge, and it fell to the that of the limitation of the author- cargo-owner, who claimed to be in- ity of the master, was not consid- demnified by the ship-owners. ered in the Exchequer .Chamber, By the laws of France there was the Court being of opinion that by no personal liability of the ship- entering into the contract of af- owners, and the case turned upon freightment the parties intended to what law was applicable. It was be governed by the law of the ship held by the Queen's Bench, and as to all questions of sea damage. afterward upon appeal by the Ex- Said XVILLIS, J. : chequer Chamber, that neither the "The general rule, that where the Danish law (the law of the place of contract of affreightment does not contract) nor the law of Hayti provide otherwise, there, as be- (where cargo was loaded), nor the tween the parties to such contract, Portuguese law (where bottomry in respect of sea damage and its was given), nor the law of England incidents, the law of the ship should (as the place of performance), were govern, seems to be not only in ac- intended by the parties to apply, cordance with the probable inten- but that all the facts showed that tion of the parties, but also most they intended to submit to the law consistent and intelligible, and of the flag. In the Queen's Bench, therefore most convenient to those BLACKBURN, J., followed directly engaged in commerce." THB LAW OF THE FLAG.

The same question had already visit in the course of a circuitous been before the courts of this coun- voyage." try, and different decisions had been In Malpica v. McKeown, 1 La., rendered, none of them being exact- 249, a question arose as to the ly in accord with Lloyd v. Guibert. liability of the ship-owner for prop- In Pope v. Nickerson, 3 Story, erty on board the ship belonging 465, exactly the same question to a passenger which was lost. arose. The schooner Anawan, The point was made that, as the owned by citizens of Massachusetts, passenger and property were taken took on board at Malaga a cargo on board at a foreign port, the law consigned to Philadelphia. She of that place, and not that of the put into Bermuda in distress, and place of residence of the ship- there the master executed bottomry owner, should determine his lia- upon ship, cargo and freight. The bility. PORTER, J., said, in decid- question arose whether there was ing that the lex loci contraclus any personal liability of the ship- prevailed: owner. By the law of Pennsyl- "We are of the opinion that the vania, such personal liability ex- law of the place of contract, and not isted, but by the laws of Massachu- that of the owner's residence, must setts and Spain it did not exist. be the rule by which his obligations Judge STORY held that the law of are to be ascertained. The lex loci Massachusetts, being the law of contractus governs all agreements the domicile of the owners, pre- unless expressly excluded, or the vailed. He said: performance is to be in another "But what I wish to rely country, where different regula- on is the fact that the master has tions prevail. What we do by an- no power to bind the owners be- other we do by ourselves; and we yond the authority given to him by are unable to distinguish between the owners; and that, from the the responsibility created by the nature of the case, the extent of owner sending his agent to contract that authority, is the law of the in another country and that pro- country where the ship belongs and duced by going there and contract- they reside, for it is there that the ing hiinself." authority is given, and there it is to The same question again arose in be interpreted. If, by the law of that State, in Arayo v. Currel, i La., the domicile of the ship and of the 528, and a similar conclusion was owners, the authority of the master reached. is limited to the ship and freight, MARTIN, J., said: "If this ques- and does not, in the absence of ex- tion turned on the master's having press instructions, bind the owners exceeded his powers, we are in- personally, it seems difficult to clined to think that, as the general understand how resort can be had rule authorized him to bind the to the law of a foreign country, un- owner to the extent contracted for, known and unsuspected (it may be) the plaintiff who contracted with by the owners, to expand that him was unaffected by a limitation authority to the positive creation in a statute of another country, of of personal obligations on the part which he could not be presumed to of the owners, and that, too, ac- have any knowledge, and to the cording to the law of every succes- authority of which he was not sub- sive country which the ship may ject." THE AUGUST.

(b) To control the cargo.- tion but that he is to deal with the This question is closely allied to the goods as an Italian master is to be last one, and the same rule applies: taken to deal with goods on board "Whoever puts his goods on his ship, unless lie is bound to an- board of a foreign ship to be car- other mode? Upon principle it ried, authorizes the master to deal seems to me that he who ships goods with them according to the laws of on board a foreign ship, ships them the ship's flag, unless that authority to be dealt with by the master of is limited by express stipulation be- that ship according to the law of the tween the parties at the time of the country of that ship, unless there agreement :" Scrutton on Charter is a stipulation to the contrary." 8 Parties and Bills of Lading, page i r. In the Bahia, Br. & L. 3 , Dr. In the Gaetano and MLIaria, L. R. LusHINGToN held, in a case where 7 P. D., .37 (182), a charter party cargo was shippedon board a French was entered into in London for the ship, that all questions relating to charter of an Italian ship. Goods transshipment were to be deter- were shipped under this contract in mined by the law of the ship. New York. The vessel put into Although the question has not Fayal in distress, and while there yet been determined by our courts, borrowed money upon bottomry of it seems most probable that the law ship, freight and cargo, without of the flag would be followed to its communication with owners, as re- proper limit, that is, to questions quired by the law of England. In concerning the right of the master a suit upon the bottoniry bond the to bind the ship-owner, either by cargo-owners defended and alleged hypothecation or by implied stipu- that it was invalid, as it was made lations in contracts of affreightment without communication. It was limiting the liability of the ship- held that the law of Italy, which owner, and also to all questions in did not require communication, reference to the power of master was applicable. over cargo. BRETT, L. J., said: "What isthe It seems, too, that questions of principle which is to govern this the right of the ship-owner to re- case? The goods are put on board cover pro rata freight are to be an Italian ship, and the person to governed by the law of the flag: exercise authority is an Italian Lowndes, on General Average, p. master. Is the authority of the 229. The question was raised in Italian master to depend upon the Nat. Board of Underwriters v. 'Mel- law of the country of the shipper, chers, 45 Fed. Rep.. 543, but its when that law is contrary to the decision was unnecessary under the law of his own country? Why facts of that case. should it? Is the master of a ship It will be observed that in the to be taken to know the law of the case of Pope v. Chickerson, Judge country of each shipper of the goods STORY approached very closely to which are put on board his ship? the doctrine of the "law of the It would be strange if that were so. flag." But to have applied that If a merchant puts his goods into law to that case would have left the the power of an Italian master, on case undecided. The flag was board of an Italian owner's ship, American, but by rererring to that what is the meaning of the transac- country, owing to our peculiar sys- THE LAW OF THE FLAG. tern of government, there was no namely, that of the flag; and so to uniformity in the law upon this hold is to adopt a simple, a natural subject, and therefore some further and consistent rule." test was necessary. Upon appeal, however, while (2) The Efrect of the Law of the the decision was affirmed, the Flag upfon the Validity of the Con- Court, evidently, did not go quite tract of Affreightment.-In the so far. Lord HALSBURY, L. C., Missouri Steamship Company, 42 said: "Now this is a contract Ch. Div., 321 (1886), this rule was for the conveyance of cattle from widely extended. In that case a Boston to England by sea, on contract was made in Boston, be- board a British ship, by a British tween an American citizen and the company whose domicile is in Eng- agent in Boston of a British steam- land. These circumstances, though ship company, for the transporta- very strong, would, perhaps, not be tion of certain cattle in the 1is- conclusive. But when I look at the souri, a British ship. The contract contract itself and find that the or- contained a provision that the com- dinary exceptions to the bill of lad- pany should not be liable for negli- ing are the Queen's enemies and gence of the master or crew. Such so on, it is absolutely impossible a provision was valid by the Eng- to resist the conclusion that the lish law, but invalid by that of the parties did contemplate being gov- United States and Massachusetts. erned by the English law in their The cattle were lost by the negli- contracting relations." The effect gence of the master and crew. of the use of the words, "Queen's Crnlnv, J., held that the English enemies," is shown in the principal law, as the law of the ship, showed case to mean only the enemies of that it was the intention of the the ruling power, which mighthave parties to submit to the English been that of America or of Eng- law. He said: "I have referred land. The learned judge was also somewhat fully to this judgment of the opinion that, as one of the (Lloyd v. Guibert) in order to show provisions only, and not the entire that the principle upon which it contract, was void by the law of proceeds is not confined to the par- Massachusotts, where it was made, ticular facts of that case, but is ap- that it would be enforced by the plicable, and ought to be applied, English courts. not merely to questions of construc- In the United States directly tion arising out of the contract of opposite conclusions have been affreightment, but to questions as reached. to the validity of stipulations in the In the Brantford City, 29 Fed., contract itself. Any distinctions 373, decided in D. C. U. S., S. D. of founded on the difference of these N. Y., in 1886, the facts were al- questions were not rested on sub- most identical with those in the stantial grounds, and would lead to Missouri. Judge - BRow-N- held uncertainty and confusion in mer- that the law of the United States cantile transactions of this charac- should prevail. It may be doubtful ter. It is just to presume that in whether the point was actually in- reference to all such questions the volved in that case, as the facts tend parties have submitted themselves to show that the proximate cause to the law of one country only, of the damage was the defective THE AUGUST.

fittings of the steamship, amtiount- Supreme Court of the United ing to unseaworthiness, which States in the Liverpool and Great was not one of the exceptions Western Steam Co. v. Phoenix In- of the bill of lading: Steel v. surance Co., 129 U. S., 397 (1889) State Line S. S. Co., 3 App. Cases, (the Montana). There, a contract 72; the Huaji, 16 Fed. Rep., 861; was entered into in New York by a Tattersall v. Steamship Co., L. R., resident of New York with the 12 Q. B. D., 297. Referring to the agent of a British company for law of the flag, he says: "The carriage of certain property to 'law of the flag,' so called, which, Liverpool. The bill of lading con- it is urged, should govern this case, tained the usual clause, exempting does not embody any rule of legal the company from negligence of construction. Literally, it is but a master and crew. The property concise phrase to express a simple was shipped on the Montana, car- fact, namely, the law of the coun- rying the English flag, which was try to which the ship belongs and lost through the negligence of the whose flag she bears, whether it master and crew. accords with the general maritime The Court held that the law of law or not. In so far, however, as this country, as the lex loci con- the law of the flag does not repre- tractus, must prevail, and .that the sent the general maritime law, it is exemption clause was invalid. but the municipal law of the ship's Mr. Justice GRAY said: "This home." review of the principal cases de- In the Titania, 19 Fed. Rep., iot monstrates that, according to the (1883), the same judge held that in great preponderance, if not the uni- the case of a shipment from Dun- form concurrence, of authority, the dee to New York, on board a British general rule, that the nature, the vessel, the English law should gov- obligation and the interpretation of ern in respect to damages upon the a contract are to be governed by high seas. He said: "The ship- the law of the place where it is ment being made in England, and made, unless the parties at the time upon an English vessel, the law of of making it have some other law the flag should govern." In the in view, requires a contract of Oranmore, 24 Fed., 922, there was affreightment, made in one coun- an express provision that any ques- try between citizens or residents tion under the bill of lading should thereof, and the performance of be determined by the English law. which begins there, to be governed In the District Court of U. S., D. of by the law of that country, unless Maryland, Judge MORRIs held that the parties, when entering into the the English law should goverti. contract, clearly manifest a mutual Considering that case in connection intention that it shall be governed with the decisions of the courts of by the law of some other country." this country, 'it is questionable An examination of these cases whether there was not merely an demonstrates that the American attempt to evade the decisions in courts will not, from the mere fact reference to liability for negli- that goods were shipped on an gence. But the question was not English vessel, assume that the raised. contract is an English one. This question came before the The question is not free from THE LAW OF THE FLAG. doubt, and it is probable that pa- general rule is that the law of the triotic motives had some effect country where a contract is made in both cases. governs as to the nature, the obli- In some respects the American gation and interpretation. *The rule, to prefer the lex loci contrac- parties to a contract are either the tus, seems to have more to support subjects to the power there ruling it. Take the following case: or, as temporary residents, owe it If goods should be shipped at an a temporary allegience; in either English port in an American ship, case, equally they must be under- under a contract made with ship's stood to submit to the law there agent at that place, and incorpo- prevailing, and to agree to its action rated into the bill of lading was the upon the contract." clause that the owner should not In the recent case of Jacobs v. be liable for negligence of master Credit Lyonnais, L. R. 12 Q. B. D., and crew, it does not seem proba- 589, the defendants, a London firm, ble that the English courts would contracted in London to sell to the hold that the shipment of the goods plaintiffs, London merchants, a on the American vessel'would make quantity of Algerian exports, to be the contract an American one. shipped by a French company at They would probably discover some an Algerian port, on board vessels facts to show that it was the inten- to be provided by the plaintiffs in tion of the parties to submit to the London. The contract also con- English law. tained provisions in regard to ship- Upon principle, the case of the ment by steamer from Algiers, and Missouri appears to be in conflict the plaintiffs were required to ap- with other English cases. prove and accept the exports as -In P. & 0. v. Shand, 3 Moo. P. put on board in that country. C. (N. S.), 272 ; 12 L. T. N. S., 8o8 In the Court of Appeals, BOWEN, (I865), the plaintiff paid one entire L. J., remarks : "Certain presump- sum for his passage from England tions or rules in this respect have to Mauritius by a ship of the de- been laid down by judicial writers fendant company, and signed a of different countries and accepted ticket stating that he accepted the by the courts, based upon common conditions printed thereon, one of sense, upon business convenience, which was that the company would and upon the comity of nations; not be responsible for loss of the but they are only presumptions or luggage of the passengers. Some .prima-facierules that are capable of the plaintiff's luggage was last of being displaced whereyer the seen at Suez, in the company's pos- clear intention of the parties can be session, and was not afterward to gatbered from the document itself be found. In an action to iecover and from the nature of the transac- its value, the Supreme Court of tion. The broad rule is that the law Mauritius held that the Fret'ch law, of the counitry where the contract which there prevailed, should gov- is made presumably governs the ern. Upon appeal, the Privy Coun- nature, the obligation and the inter- cil reversed that Court's holding pretation of it, unless the contrary that the liability of the company appears to be the express intention was to be determined by the law of the parties. of England, as the lex loci con- "Again, it may be that the con- traclus. TURNER, L.J., said: "The tract is partly to be performed in THE AUGUST. one place and partly in another. there would be little doubt that the In such a case, the only certain American law would determine its guide is to be found in applying effect." sound ideas of'business. conveni- Change the facts of this case ence and sense to the language of slightly, and supply, instead of an the contract itself, with a view to English line of steamships, a line discovering from it the true inten- composed of American and English tion of the parties. ships. How can there be any pre- "Even in respect of any perform- sumption of the intention that the ance that is to take place abroad, law of the flag was intended to the parties may still have desired govern in such a case? that their liabilities and obligations The shipper at the inland point shall be governed by the English does not know whether his cotton law, or it may be that they have will be carried on an English or an intended to incorporate the foreign American sbip. law to regulate the method and It certainly is not true that a manner of performance abroad, -stipulation in a bill of lading, that without altering any of the inci- the ship-owner shall not be liable for dents which attach to the contract the negligence of the master and according to the English law. crew, is to be void or valid by the Stereotyped rules laid down by fact that the cotton is shipped on juridical writers cannot, therefore, the American or English ship, a be accepted as infallible canons of fact of which the shipper has no interpretation in these days, when knowledge whatever. commercial transactions have al- The lex loci contractus has better tered in character and increased in support. In a contract for carriage complexity; and there can be no the agreement is made at one place hard-and-fast rule by which to con- for delivery in another. It is evi- strue the multiform commercial dent that the customs of the place agreements with which, in modern of delivery must govern the manner times, we have to deal." of delivery. That would seem to The rule suggested by Mr. Carver be the only application of the law (Carriers, page 218), that where of that place. Generally, the man- there is a division of carriage the ner of carriage is an immaterial parties may intend to be bound by question and does not affect the one law as to one part and another contract. law as to another part, does not Two facts only are of importance- seem to solve this question. the delivery of the goods to the He puts the following case: "An carrier, and the delivery by the agreement is made between Ameri- carrier to the consignee. The cans for the carriage of cotton, method of carriage is, generally under a through bill of lading, speaking, immaterial. If there is from a place inland in the United right delivery the law is satisfied. States to England, say by rail to Why, then, should an immaterial Philadelphia, and thence by steamer fact determrine the relations of the belonging to an English line. It parties to the contract and decide may well be supposed that the law whether a provision of the contract of the flag was meant to govern the is valid or invalid? contract as to the latter part of the HORACE L. C1EYNEy. . transit, although as to the first part Philadelphia.