JUDGMENT DELIVERED.

Otago Daily Times, Issue 20893, 6 December 1929, Page 3

JUDGMENT DELIVERED.

CLAIM FOR SUMS ADVANCED. PLAINTIFF’S CASE FAILS. His Honor‘Mr Justice Kennedy gave his reserved decision in the Supreme Court yesterday in the case iu which action was taken by A. J. Allen, Ltd., to recover suras advanced by them by way of wages to the captain and crew of the s.s. Oreti, and- also for necessaries paid for and supplied to the steamer by the plaintiffs. When the case was heard, Mr Hay appeared for. Messrs A. J. Allen, Ltd., Mr Lascellcs (Christchurch) for the liquidators of the company which owned tho Oreti, and Mr J. 8. Sinclair for the mortgagee (Mr Dunn). ' His Honor’s judgment was as follows: ‘ The plaintiff, A. J. Allen, Ltd., claims ns agent for the Oreti Shipping Company, Ltd., tho sum of ’£456 19s 3d, of which buiti £233 12s 8d is stated to be for wages to January, 1020, paid for and on behalf °£ the Oreti Shipping Company, Ltd., and the balance, namely, £222 16s 7d, is stated to. have been owing for necessaries supplied by it to the ship Oreti from January 1, 1029, to February 28, 1929. The ship Oreti was owned by the Oreti Shipping Company, Ltd., and was subject to a first mortgage to Alexander Dunn securing approximately £7OO, and to a second mortage securing a large amount. The Oreti Shipping Company, Ltd.; went into liquidation on March 4, 1020, and the Oreti vv°s on March C, 1020, arrested on the plaintiff’s application and, later, on the application of the liquidator of the company and with the consent of tho first mortgage, the ship was sold. Tho contest is as to tho right of the plaintiff on the one -hand and of the first mortgagee on the,other to part o! the proceeds of the sale.

At the heaving it was admitted bv counsel for the plaintiff that it could no‘t properly be contended that the plaintiff had any maritime lien for necessaricG supplied by it to the ship, and tho plaintiff a claim was confined to a claim to a maritime lien for £167 le 8d alleged to be money advanced to the master for his own wages and (or the wages of tho crow and for the sums of £4 ICs and £3B 11s berthage and dock dues paid by the plaintiff to the Otago Harbour Board. For the latter charges no maritime lien arises. JUio agent did not, on payment to tho utago Harbour Board, become entitled to any maritime lien entitling it to • a claim to the proceeds of the sale of the ship in priority to the claim of the mortgagee or to that of the liquidator. • I'lestion, then, arising for decision is the plaintiff’s claim to a maritime lien for the stun of £167 Is 8d paid to the master of/the ship.- It was contended that the master was entitled to a lien for this sum, and that the plaintiff, having advanced the money to the master, should stand in his shoes and be entitled to his lien. - ; The ship-Oreti was chartered in 1924 i°J] , e Marlborough Shipping Company, Ltd., by Mr D Reece, who was intimately ' Vlth the management of the plaintiff company and with Reece Bros., ami later with Reece and Co.. Ltd, Mr u. Reece was a director of the plaintiff company, and also a director of the “hipping Company, in which company the plaintiff held shares. His col;h™ gU J^- I l?s xvcr ' on tho directorate of pla ‘ nti “ company were , content to . 011 matters relating to the Oreti Sfcf-S‘ n l- Com i\ ny > J**-. in his'hands and They looked to him to keep with °n ch *i' tJ ‘P ““duct of offairs ,ivV th , oreti 8 l“Pl>m(t Company. Ltd., ana he always assured them, so Mr Allen says, that everything was all right. Adances for wages were only part of the pajmenta which the plaintiff company rennlfj/5r t]le Orcfi Shipping Company, Ltd. Advance* were made in the same way as payment for what were necestho Necessaries supplied bn eiiTfi.V^ aro . 1 ? r nla - facie presumed to be supplied on the credit of the ship and owLr° th f perß ? nal , c . re dit of tho ar?rPu f lar^I th i S f ° rm 1H wl,ich accounts Dlied or d^; d i r y ftn agent .’ ' vh ° has sup”r p ■ i * or necessaries, to hie printJm, ls cadence to rebut that presump. Co lons” 8 * Co - v - Bnchhoistor and u; 0 -’ j 908 ,’ ,-f- C -. 45Sat p. 460. Lord Att ” 6 ? 1 ’. delivering tho judgment of their Lordships in that case, said: “Nor is an^r/i 1110 ,?- r p rinciple of law that an agent, loses his right so to £Ua if in ho account ho furnishes to his principal for those necessaries ho gives credit for sums received. In tho case of Th« Underwriter the governing consideration ™ favour' of Phillimore, J , tbiq +w the plai n tiff turned was stituted h ‘now’' 88 here ’ the suit wa s inoo.nw a- 0 , 1 to recover* any particular the whrffo^V ° £ a general account, but nartleiffit L the si,m - expendcd upon this • ° ccas . lon m payment of the tbp C «h£ ieS required by the exigencies of hftv« h p? ?- nd 'V 1 i lout '"■hich she could not 1 on^inue d hor voyage/ iy » Advances for tvages were only a 'Dart of the payments the plaintiff company ro . madc - Although no actnarad- ““ ? c r jaecs was mado until the mastor notified the amount required and almaster signed a receipt for the amount advanced, yet all tho circumstances show that the advance was really to the managing agents or the owners lor whom the. plaintiff was the agent, ■the heading “Oreti” in the accounts was a matter of bookkeeping practice and did not- alter the substantial nature of , c . arrangement, which was that the plaintiff wds the Dutiedin agent and made advances as required and, in case the freights received were not sufficient, looked to the managing agents .or the owner to be reimbursed, receiving for rernuneratiOn as such agent a percentage on freight and a two-guinea fee in respect of each inward trip. The advances or payment* now sued for did not differ from, advances and payments made every time the-ship was in the local port* and even when not in the local port, except in thit, that all previous advances or payments had been promptly reimbursed by the Oreti Shipping Company, Ltd., on re- : quest. The proper inference to draw from the evidence, in my opinion, is that the master did not, in receiving the advance, incur a liability on account of the ship and that the plaintiff did not make the advance in reliance on the ship as the source of payment, but made it in reliance on the managing agents or the owner. Tho advances were made to the master for and On behalf of the Oreti Shipping Company, t Ltd., 8S the indorsement of the plaintiff’s writ states. Tho course of dealing between the parties, the actual accounts rendered, and the adCompanying correspondence .and the admissions made in cross-examination show, in my opinion, that the advances are properly to be taken to bo made on the request of the Oreti Shipping Company, Ltd., or tho managing agents under promise of reimbursement, when the monthly statement was sent, of any excess over and above the amount of freight received. The accounts produced show continuous and substantial payments by the plaintiff, for which it could not iu any event claim a maritime lien. Ido not think that some of these payments were made in reliance on the managing agents or the owner, and that others were made in reliance not on the managing agents Or the- owner but in reliance On the ship. "What the plaintiff did was to institute this action to recover the balance of a general account and then to abandon all items but certain particular and selected items and to claim a lien for them. £ find then in fact that the payment for wages was not made in reliance upon the ship but in reliance on the managing agent* or owner. The plaintiff's advances were, in my opinion, made, ns in Clark v. Bowring, 10 Ct. of Sess. 1168, on the credit of the managing agents or the owners, and consequently, ns pointed out by nil the judges in that case, the plaintiff never acquired a maritime lien for those advances. The plaintiff has failed to establish his claim, and there will be formal judgment against the plaintiff in accordance with this judgment. The liquidator, after the sale, might have left the burden of opposition to the plaintiff’s claim to the first mortgagee, who had intervened as defendant. This affect* the award of costs. Costs arc awarded ns against the plaintiff as follows Ten guineas as a lump sum in lieu of taxed costs to tho. liquidator, with witnesses’ expenses and disbumnents to be fixed by the registrar, and 20 guineas to the first mortgagee in lieu of taxed costs with disbursements to bo fixed by tho registrar.