South African Railways and Harbours v Smith's Coasters (Prop) Ltd

• Jurisdiction: South Africa
• Citation: 1931 AD 113

South African Railways and Harbours Appellant v Smith's Coasters (Prop) Ltd Respondent
1931 AD 113

1931 AD p113

Citation	1931 AD 113
Court	Appellate Division
Judge	De Villiers CJ, Curlewis JA and Roos JA
Heard	November 6, 1930
Judgment	January 27, 1931

Flynote : Sleutelwoorde

Crown — Crown Liabilities Act 1 of 1910 — Shipping — Limitation of liability under section 503 of Merchant Shipping Act of 1894 his amended — Whether binding upon Crown.

Headnote : Kopnota

The Crown Liabilities Act 1 of 1910 gives a right of action against the Crown and to that extent the prerogative of the Crown must be taken to have been abrogated by the Act, but all other prerogatives and rights of the Crown remain.

The Crown is not bound by section 503 of the Merchant Shipping Act (57 and 58 Vict. C. 60) as amended.

Where, therefore, the South African Railways and Harbours sued the respondent company for damages arising out of the sinking of a ship owned by the respondent in the approach to a harbour and the latter pleaded that in terms of section 503 of the Merchant Shipping Act of 1894 its liability was limited to an amount of £8 sterling for each ton of the ship's tonnage.

Held, on appeal, that an exception to this portion of the plea should have been allowed.

The decision of the Durban and Coast Local Division in South African Railways and Harbours v Smith Coasters (Proprietary) Ltd., reversed.

Case Information

Appeal from a decision of the Durban and Coast Local Division (TATHAM, J.).

The facts appear from the judgment of DE VILLIERS, C.J.

1931 AD p114

A. E. Carlisle, K.C. (with him J. C de Wet), for the appellant: The appellant is the Crown. See Winter v SA Railways and Harbours (1929 AD at p. 104) and S.A. Railways and Harbours v Edwards (1930 AD 3). The position of the Crown under this statute must be interpreted according to English principles of construction. See Union Government v Tonkin (1918 AD 533 at p. 541), from which it appears that the intention that the Crown should be bound must clearly appear either from the language used or from the nature of the enactment. The expression "The Crown" includes officers of State acting on behalf of the Crown in the discharge of executive duties anywhere in the Dominions. See Halsbury's Laws of England (vol. XXVII, para. 316). The presumption is that the Crown is not bound by statute. See Tonkin's case (supra, at p. 545).

The Merchant Shipping Act a do not bind the Crown as it is not expressly mentioned and the provisions of sec. 741 of the Act of 1894 in expressly exempting King's ships must not be taken to mean that the Crown is generally bound otherwise. See Halsbury's Laws of England (vol. VII, para. 219); Smithett v Blythe (109 E.R. 876) and The Loredano (1922, p. 209). From the object aimed at it is clear that the original enactment of 1734 was to protect British ship-owners from paying more than the value of the ship and the freight where goods on board were stolen by the master or the crew without the knowledge or privity of the owner. See Marsden's Collisions at Sea (8th ed., p. 169f). This limitation was extended by subsequent Acts to theft by others than the crew; fire and collision. These Acts were subsequently incorporated in the Merchant Shipping Acts.

If the court below means that sec. 503 was enacted for the public good and therefore binds the Crown, every Statute must be for the public good to some extent; but that does not lead to a necessary implication that the Crown is bound. See R v Osbourne (146 E.R. 752). All the circumstances must be looked at before it can be decided whether the Crown is bound or not. One of the circumstances to be taken into consideration in this case is the importance of keeping the naval harbours free of all damage and of exacting from those injuring them full compensation. This is important from the view of encouraging shipping, one of the objects of the Statute, and from the view of public safety, e.g., in time of war. See R v de Beer (1929 T.P.D. 104 at pp. 111,

1931 AD p115

112 and 115); Transvaal Provincial Administration v Klerksdorp Municipality (1923 T.P.D. 475); Magdalen College case (77 E.R at p. 1246), where one principle of construction is that the Courts do not give an interpretation which advances private and destroys public interests. If the interpretation contended for is given, the interests of both State and of individuals are protected.

Assuming that a distinction may be drawn between the trading and other activities of the Crown, as the court below held, the action here is based on the culpa of respondents, i.e., to recover as damages a sum incurred by the Crown in carrying out an executive act. Besides the activities of the Crown under Act 22 of 1916, as suggested by the court below, are not confined to commerce merely, but are much wider. See Chapter 1, secs. 3 (a), (g), (i) and 4 (12). As to the reasoning based on the assumption that secs. 8, 22 and 4.1 deal exhaustively with the rights of the Crown, this loses its force because secs. 8 and 43 were necessary in view of the Crown Liabilities Act of 1910. Sec. 22 gives inter alia a right of parate executie which it was wiser expressly to confer. The cases of Union Government v Estate Whittaker (1916 AD 194 at p. 201) and in re Webb & Co. (1922, 2 Ch. D. 369), which were cited by the learned Judge in the court below as showing the modern tendency to hold the Crown bound in its commercial activities, merely applied the ordinary rule of construction. The reference to the trading side of the Crown was merely used as an element in examining the surrounding circumstances from which it was to be ascertained whether the Crown was bound or not. See Webb's case (supra, at p. 377).

If the point is not to be decided in accordance with the usual principles of construction of statutes it should be looked at from the point of view of the Crown's prerogative under the Roman Dutch law, under which the claim falls under the Lex Aquilia and respondents are liable for the full amount of the damage. See Smith v Davis (1878, Buch. 66). Even where there is no culpa, maritime law allows half of the damage to be recovered where it is less than the value of ship and cargo; where it is more, the ship and cargo may be surrendered as noxa. See Bynkershoek's Quaestinnes Juris Privatae (Bk. 4, Ch. 20).

The Crown or Fisc has a tacit hypothec for the amount of the damages as soon as the judgment is given. See Voet (22.2.9); Huber's Hed. Reg. (2.46.12); Nathan's Common Law (vol. II,

1931 AD p116

pp. 942-3); de Bruyn's Opinions of Grotius (85 p. 608). The tacit hypothec of the Crown is preserved by sec. 8 of Law 13 of 1887 (n).

E. A. Selke, K.C. (with him T. B. Horwood), for the respondent: Assuming that the appellants are the Crown in the broadest acceptation of the term, it does not follow of necessity that they possess all or any of the prerogatives, privileges or rights which are peculiar to the Crown under the Roman Dutch Law or English Law when engaged on activities essentially governmental.

In that assumption sec. 2 of Act 1 of 1910 makes justiciable by the Court claims against the Crown which, had they been against a private person would have been enforced by action. Subject to certain provisos that Act has swept away all the prerogatives of the Crown. See S.A. Railways and Harbours v Edwards (1930 AD at p. 7). Part 8 of the Merchant Shipping Act of 1894 which includes sec. 503 is by sec. 509 made to extend to the whole of the Dominions, and sec. 504 in that part contemplates and authorises the bringing of an action for a declaration of limitation of liability in terms of sec. 503. See MacLachlan's Merchant Shipping (6th ed., p. 96). An action for a declaration of rights falls within the Crown Liabilities Act . See Minister of Finance v Barberton Municipal Council (1914 AD 335). Though in point of fact the appellants have not instituted action in this case but have relied on their rights by way of defence, that makes no difference to the legal position. Therefore whether or not the provisions of the Merchant Shipping Act bind the Crown, the provisions as to limitation of liability do bind the Crown by reason of Act 1 of 1910, sec. 2, as sec. 503 does not take away any rights of the Crown but merely fixes the extent of liability. See a dictum in The Loredano (1922, P at p. 211).

As to the meaning of the rule in regard to the Crown being bound by statute as set out in Tonkin's case (supra at p. 541) see Halsbury's Laws of England (vol. VI, para. 543) and Receiver of Revenue v Barlinski & Co. (1920 CPD 410 at p. 413).

Under English and Roman Dutch Law prerogative rights are part of the common law as distinct from legislation and they vary from time to time and from place to place in the sense that they exist only in so far as they have not been abrogated or modified by legislation. See Halsbury's Laws of England (vol. VII, para. 219); The Attorney-General v Keyser's Royal Hotel (1920, A.C. at p. 526 per Lord DUNEDIN) and compare the argument of Sir

1931 AD p117

JOHN SIMON in Food Controller v Cork (1923, A.C. at p. 653) which was adopted. See also Union Government v Estate Whittaker (supra, at p. 203 and 207 ff); Receiver of Revenue v Barlinski (supra, at pp. 413-4). As there are privileges of the Crown embodied in Act 22 of 1916, they must be looked upon as the only powers given to the Crown in regard to the subjects dealt with in that Act to the exclusion of common law rights. See The Attorney-General v de Keyser's Hotel (supra, at pp. 538, 539, 540); in re Webb & Co. Ltd. (supra, at p. 387) and Whittaker's case (supra, at p. 207). It also follows that the statement that the Crown's prerogatives are as extensive in the Dominions as in the United Kingdom must be understood as subject to the above qualifications. See Whittaker's case (supra, at p. 207) and Tonkin's case (supra, at p...