In Re Arbitration Between Polemis And Furness, Withy & Co., Ltd., Ct. Of App.,

3 K.B. 560 (1921)

Facts

Polemis and Boyazides (P), the owners of the Greek steamship Thrasyvoulos chartered the steamship to Furness, Withy & Co., Ld. (D). P were to provide and pay for all the provisions and wages of the captain, officers, engineers, firemen, and crew, to pay for the insurance of the vessel, war risks excepted, and also for all the engine room stores, and maintain her in a thoroughly efficient state in hull and machinery for ordinary cargo service. D were to provide and pay for all the coals, fuel, port charges, pilotages, agencies, commissions, and all other charges whatsoever, except those before stated. By clause 21: 'The act of God, the King's enemies, loss or damage from fire on board in hulk or craft, or on shore, arrest and/or restraint of princes, rulers, and people, collision, any act, neglect, or default whatsoever of pilot, master, or crew in the management or navigation of the ship, and all and every of the dangers and accidents of the seas, canals, and rivers, and navigation of whatever nature or kind always mutually excepted.' By clause 22, should any dispute arise between the owners and charterers, the matters in dispute were to be referred to three persons in London, one to be appointed by each of the parties hereto, and the third by the two so chosen; their decision or any two of them, to be final and binding. D loaded her with a cargo of benzine and other items and headed to Casablanca. It had become necessary to shift a number of the cases of benzine, and native stevedores had placed heavy planks across the forward end of the hatchway in the 'tween decks, using it as a platform in the process of transferring the cases from the lower hold to the 'tween decks. Because of breakage of the cases, there was a considerable amount of petrol vapor in the hold. In the course of heaving a sling of the cases, the sling came into contact with the boards placed across the forward end of the hatch, causing one of the boards to fall into the lower hold. The fall was instantaneously followed by a rush of flames from the lower hold, and this resulted eventually in the total destruction of the ship. P claimed that D was liable for the loss of the ship; that fire caused by negligence was not an excepted peril; and that the ship was in fact lost by the negligence of the stevedores, who were D's servants, in letting the sling strike the board, knocking it into the hold, and thereby causing a spark which set fire to the petrol vapor and destroyed the ship. D contended that fire was an excepted peril; that there was no negligence for which the charterers were responsible, inasmuch as to let a board fall into the hold of the ship could do no harm to the ship and therefore was not negligence towards the owners; and that the danger and/or damage were too remote - i.e., no reasonable man would have foreseen danger and/or damage of this kind resulting from the fall of the board. The Arbitrators found that a spark emanating from a dropped plank could not reasonably have been anticipated. Some damage to the ship might reasonably be anticipated by a falling plank. The arbitrators found that the ship was lost by fire, that the fire arose from a spark igniting petrol vapor in the hold, that the spark was caused by the falling board, that the fall of the board was caused by the negligence of the Arabs (other than the winchman) engaged in the work of discharging, that the said Arabs were employed by D or their agents the Cie. Transatlantique on behalf of D, and that the said Arabs were the servants of D, that the causing of the spark could not reasonably have been anticipated from the falling of the board, though some damage to the ship might reasonably have been anticipated, there was no evidence before us that the Arabs chosen were known or likely to be negligent, that the damages sustained by P through the said accident amount to the sum of £196,165 1s, 11d. D appealed.