Scottish Court of Session Decisions

Subject_1 PERICULUM.
Subject_2 SECT. III.

Periculum between Mandant and Mandatary. - Postmaster, whether answerable for Money sent by Post.

William Hoog Merchant in Rotterdam
v.
Kennedy and Maclean, Merchants in Glasgow

1754, July 24.
Case No. No 31.

A merchant in Scotland having ordered goods to be sent him from Holland, and the ship in which they were sent having been lost, he was found liable for the price of them, although no bill of lading, or letter of advice had been sent.

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In July 1751, Kennedy and Company commissioned certain goods from Hoog, to be sent by the first ship bound for Leith, Greenock, or Borrostownness Hoog, on the 12th of August, shipped the goods on board the Hopewell, Burton, bound for Leith, and committed the invoice to the care of the captain: He sent no bill of loading, or formal letter of advice, by course of post; but, on the 3d of September, he transmitted a copy of his account-current, wherein he took credit for goods sent by Burton for Leith as per invoice, without specifying either the goods or the ship. The Hopewell sailed from Rotterdam on the 6th of September, and next day was lost. Kennedy and Company being pursued by Hoog for the price of the goods commissioned, contended, That they were not liable; and pleaded, That Hoog, as executor of a mercantile commission, was bound to have sent bill of loading, invoice, or letter of advice, by course of post, to his constituents; and that his omission must subject him to the damage arising from the loss of the goods. Neither does it alter the case that the loss was fortuitous; for that the custom of merchants presumes, That, where damage could have been avoided, on information given, it would have been avoided. Now, the defender might, on advice, have insured the goods, and avoided the damage; without advice, he could not; Hoog must therefore be subjected to the damage, which, by his own neglect, became inevitable.

Answered for Hoog: The defences ought to be repelled; for that the commission was executed according to its precise tenor; neither bill of loading, nor letter of advice was required; and the custom of merchants is, in this case, indeterminate. Where regular posts are not established, it is impossible to send bills of loading and letters of advice; where the ship generally arrives sooner than the post, which happens in the run between Holland and Leith, it would be superfluous. But, separatim, the defenders might, in consequence of the advice given, have insured the goods. Advice was timeously given, That goods were shipped on board a vessel, commanded by Burton, and bound for Leith; the defenders knew that the goods in question were the only goods commissioned by them from the pursuer, they might therefore have insured them; for that, although the voyage must be specified in the policy of insurance, the extent of the premium depending upon it; yet the name of the vessel and of the commander need not.

“The Lords found the defenders liable, and also found expences due.”

Act. J. Dundas, A. Lockhart. Alt. J. Dalrymple. Clerk, Justice. Fol. Dic. v. 4. p. 59. Fac. Col. No 113. p. 168. *** Lord Kames reports this case:

Upon the 12th July 1751, Kennedy and M'Lean wrote to Mr Hoog, merchant in Rotterdam, and commissioned from him two butts bright madder, and 300 pounds tartar, to be sent by the first ship to Greenock, Leith, or Borrowstounness, Upon the 12th of August, these goods were put on board the Hopewell, Captain Burton master, for Leith, without any bill of lading, invoice, or letter of advice. On the 14th of September, Mr Hoog transmitted to his correspondents their account-current, in which was engrossed the goods commissioned, mentioned to be sent per Burton for Leith. It appeared after, that Burton had sailed from Rotterdam 25th August, and, on the 4th September, was shipwrecked on the coast of Holland. A process being brought for payment of the price of the goods commissioned; the defence was, That if the pursuer had sent a letter of advice debito tempore, the goods would have been insured; and, therefore, that his neglect must subject him to all hazards. And, in support of this defence, it was laid down as a general rule, that it is the indispensable duty of factors and others who deal by commission, to give regular notice of the shipping of the goods by course of post, and also to transmit a copy of the bill of lading. It was answered, That this general rule suffers many exceptions; in particular, that in small commissions from this country to London or Holland, there is no such thing in practice as regular letters of advice by course of the post; and that such regular advice would, especially from Holland, be an useless piece of form; because, for the most part the ship arrives at Leith before the letter can come by the course of the post. The pursuer insisted upon another circumstance, that he did not deal by commission, nor stated any commission, but furnished the goods to the defenders at the same price he furnished them to the factors and others in Holland.

“The Lords repelled the defence, and decerned.”

The pleadings in this case being extremely loose, I shall endeavour to put it in its true light. The pursuer insisted, that he was not bound to send a letter of advice. Ergo, Whatever damages might have happened by want of that advice, he would not have been liable. For example, had the ship arrived at Borrowstounness, and the goods been lost in the landing, or after they were landed, for want of care, the pursuer by his argument would not have been answerable. This is surely pleading the point too high. If regular advice may possibly prevent loss, it clearly follows, that it is the duty of the factor or merchant to give advice. In the present case this step was indispensable, where the commission was to send the goods either to Greenock, Leith, or Borrowstounness; for without advice the defenders could not know where to expect their goods. This point being established, the only remaining point is, Whether the factor's neglect of duty will subject him to every damage that might possibly have been prevented by a regular advice, or only to the damage which is the necessary consequence of neglecting to give advice? This question is easily determined; for I take it to be a general rule in all other affairs, as well as in commerce, that neglect of duty subjects the party to every risk and to every damage, except what he can show must necessarily have happened though he had done his duty. Upon this reasoning the interlocutor is well founded; for the pursuer made it evident, that the goods must have perished though he had done his duty. The letter of advice he sent, though late, yet gave the defenders an opportunity to insure, if they thought this measure proper; because they did not hear of the shipwreck for some time after this letter of advice came to hand. They did not, however, insure; and from this it was justly presumed, that they would not have insured though they had got the most early advice.

Sel. Dic. No 67. p. 90.