PUBLIC RECORD OFFICE
Reference :-
C.O. 885
24 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH—NOT TO
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26 November 1914.}
OVERSĘA PRIZE DISPOSAL COMMITTEE:
Mr. HUGHES and Mr. W. RICHARDS.
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43. (Mr. Holt.) Immediately war broke out it was the practice. (Mr. Richards.) Yes, but these ships put in before.
H. (Chairman.) With regard to ships which were actually in port at the moment that war broke out, it was absolutely impossible for the cargo owners to effect a war insurance because they were captured; they were actually seized before they could have doue anything?
That is 80.
The position with regard to the cargo is that speaking generally the original underwriters are doubtless off the risk, but they can be put on it again for a certain premium by putting into operation the deviation clause. In the event of deviation or change of voyage the underwriters will continue on the risk by paying a suitable premium; they are prepared to do that.
45. (('hairman.) How will that affect the case? If we can bring the underwriters into line and put the cargo back on to the original policies you get over your difficulty-Then there is no risk. But a cargo of this kind consiste of an enormous number of interests. There are probably 1,100 or 1,200 bills of lading.
46. There will be a certain number of those that you cannot deal with ?—That we cannot be sure of, yee.
47. Those will have to be covered? - Yes. (Mr. Hughes.) I would like to put this question-- Whatever we do whose is the risk if we are wrong?
48. (Chairman.) The Government's?-{Mr. Richards.) That is all right. (Mr. Hughes) We have been dealing with it on quite a different basis to that.
(Chairman.) The moment the Government steps in and requisitions a cargo-I do not mean to say that cargo which has been released from the Price Court where the risk is that of the owner of the cargo, but there is a certain cargo which has not been released, and the risk of that is the Government's because the Government will have to make it good if it is lost. I must be corrected if I am wrong, but I understand that a cargo which has been released will stand at the risk
of the owner.
(Mr. Tennyson.) That will be the bulk of the cargo. 49. (Chairman.) That will stand at the risk of the actual owner of the cargo ?-Supposing it does not?
50. The only other person it can be, will be the Government, for cargo which has not been released ?---- Supposing I come and tell you what I am doing? Suppose I say, "This is what I am doing; these are the insurances I am effecting," and you say, "That is all right." Now, supposing it is all wrong, and the ship is lost, and the merchants come down upon us and say, "We cannot recover under our original policies, and you will have to pay," and they bring actions against us and they win, who will pay the money.
51. I cannot tell you at the present moment ?--- That is where we get to, because if you say we have to pay it, it is quite easy, but we have to cover it, and that is a very complicated thing to cover.
52. Does not the case work out to this, that wo have two classes of cargo in that ship? We have That is certain cargo which has not been released.
requisitioned by the Crown, and is released to the Crown, and for the time being is the property of the (rown, and at the risk of the Crown. That can be covered. We must take an outside value for that portion and cover it. Now that is quite simple ?--Yes.
53. The remainder of that cargo has been released to the claimants. That stands at their risk as long as it is on board the ship-(Mr. Richards.) So far an ordinary risks go?
54. So far as ordinary risks go. She is at present lying in a safe port, and the risk is very small. It is no good to them there, and they want you to take that cargo on, and deliver it to where they can use it. The proposition has to be put to them as to whether they are willing to have that cargo taken on at a price which includes, if their original policies do not hold good, the insurance of that cargo or an indemnity to clear you?
Mr. Hughes.) Of course, you understand that this question of the liability of the original underwriters is a disputed question? I am told by one gentleman that the voyage is abandoned-that is what he tells me.
[Continued.
Mr. Richards, whose opinion is quite as good as his, says he does not think the voyage is abandoned. I have to do one of three things. The Government have to be responsible for that, or I have to cover it as if the voyage was abandoned, or I have to open a policy by telling my underwriters the whole circumstances, and saying: Now cover my risk, whatever it may be.'
55. Is not there a fourth alternative, and that is this, that you should get together the cargo owners and that they should agree upon a common line of action with regard to the insurance: I do not know whether we can get together a sufficient number of representatives of the cargo owners to come to an agreement --No, we cannot do that.
56. But that is the proper arrangement to come tò, I think!—After this meeting this is what I am pro- posing to send: "It will be necessary to collect is u deposit on account of contract which we are prepared "to enter into with the Colonial Office for conveying "the two ships with cargoes to certain destinations a "certain percentage of the original ocean freight on the cargo forwarded. It will be necessary that this ** collection should be made from at least 80 per cent. of Australian cargo to be. forwarded before any "action can be taken. The delay at Cape Town amounts to a technical deviation as far as regards "the underwriters of the cargo not covering war - risks, &c." We were going to make it all perfectly clear what the cargo owners were responsible for and what we were not responsible for. That is how we were going to deal with it. That is why we were so glad to come here to know exactly what responsibility the Government were going to take, if any. (Mr. Richards.) Could the cargo be carried on under the terms of the original bill of landing, and subject to the terms of the bill of lading. That would relieve Mr. Hughes of a great deal of responsibility.
57. I should say, certainly yes?—There are all sorts of responsibilities.
58. I know there are. I should say myself—again. I am talking through my hat, as it were, because there is no precedent to go by-that the original bills of lading were perfectly good?-And the terms available to protect Mr. Hughes ?
(Chairman.) Certainly.
(Mr. Tennyson.) We are proposing to navigate one ship to the United States, and if the original bills of lading stand we shall be sued by the German owners.
(Chairman.) I do not think it is a feasible proposi tion to send it to the States. Of course you can send a ship to the States which has been condemned to the Crown.
(Mr. Tennyson.) This ship has.
(Chairman.) Then you can send her, because the ownership in international law has passed and there is no question about any rights of the original owner being revived.
(Mr. Tennyson.) The bills of lading in that case are terminated?
(Chairman.) Yes, absolutely.
(Mr. Tennyson.) But you distinguish in the case of a detained ship?
(Chairman) Yen.
59. (Mr. Tennyson.) That is a point on which I should not like to express an opinion.—(Mr. Hughes.) Yours is a sort of quarter-deck law. I must say that scema a sensible way of dealing with it, and I quite agree with you. Then the Government lay down what I call this quarter-dock law and therr takes the reapon- sibility. That is what you would say, and that seems to me an absolutely reasonable way of dealing with it. If we go on with all these lawyera we shall never get a settlement of this thing; we shall discuss it from now till Christmas. It is quite refreshing. (Mr. Richards.) There are the crews to be sent unt.
60. (Chairman.) That will come into the average? -And then there are the handling and shifting expenses.
61. That will come into it ?-(Mr. Hughes.) That simplifies it immensely. (Mr. Richards.) Then the arrangement will be free of liability for any repairs or anything of that kind-dry-docking or any dues?
26 November 1914.]
MINUTES OF EVIDENCE.
Mr. HUGHES and Mr. W. RICHARDA.
62. Dry dooking, but not dues P-If Mr. Hughes tenders for a certain sum payable outright ?
63. It must cover all dues? The dites at Capo Town?
64. You? Before he takes possession of the ship? 65. Yes. That falls on the cargo ?-Before he takes possession ?
66. Yes. You must find that out because you cannot get the ships out of Cape Town till that is settled. Unless you can get the Cape Government to waive the dues you will have to pay them!-Will they give delivery?
67. I cannot say that they will give delivery. What arrangements we come to now are subject to the con- currence of the Dominion Government Thero is a telegram from Australia which is important: ** King's Proctor insists individual appearance Cape Town each Australian consignee by 31st December." That is absurd.
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68. You cannot do that ?—No. Surely, satisfying the Australian authorities will be sufficient?
69. (Mr. Tennyson.) Does that mean the King's Proator at Cape Town ?-Evidently. It is proposed that this should be dealt with by the Prize Court in Australia.
(Mr. Tennyson.) Oh, no.
70. (Chairman.) It will have to be dealt with by the Prize Court at Cape Town --There are 1,100 interests.
(Mr. Malkin.) That is essential. You cannot get rid of that until you get an Act of Parliament.
71. (Chairman.) Until we get an Act of Parlia ment to enable us to shift the case to any court that is convenient - What does that mean? Does that mean these arrangements cannot be carried through?
72. No, it does not mean that. It means that the Government will have to step in and requisition the cargo and the ship and everything else away, giving an undertaking on certain conditions. It will make no difference whatsoever to the moving of the ship or the moving of the cargo-And it will not delay the delivery of the cargo ?
(Chairman.) Not in the least, if we come to an agreement.
(Mr. Tennyson.) The cargo which is to be released is taken out of the court altogether?
(Chairman.) Yes.
(Mr. Malkin.) They must get it released by the court, or else on an un-lertaking which they must get.
(Chairman.) The cargo ownere must do that.
78. (Mr. Malkin.) The Government takes no respon sibility in that?-Who will do that? There are an enormous number of sinall interests in each case, quite an exceptional number. The interests in Hamburg and Antwerp are smaller and more numerous. America they are very numerous and very mixed. Supposing you have 1,100 bills of lading from America, and, say, 800 in the "Apolda," that is 1,900, and about 400 in the other ship; that is 2,300 bills of lading.
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74. Those will all have to be produced, whether this arrangement goes through or not, because, if not, they will not be released by the Prize Court P—If they have to be produced in Cape Town, that is a serious diffi- culty. They have all gone forward to Australia.
75. (Mr. Tennyson.) A lot are on the way from the States here ?-(Mr. Hughes.} We have first to get out to Australia and get this average bond signed. That will take some time. Then, having agreed to the settlement, we have to say, "You will have to send all your bills of lading to Cape Town."
(Chairman.) That can be done at any time.
76. (Mr. Tennyson.) They ought to have done that a long time ago. We told them to?-But supposing they have not, I cannot move the ship.
(Chairman.) Oh, yes you can.
77. (Mr. Malkin.) Or they will lare to get their cargo released on bail bonds in Cape Town ?— (Mr. Richards.) I am getting a little fogged.
78. (Chairman.) I will try to explain it. These 1ple have been foolish enough to employ German shipping instead of British shipping, and for that they have to suffer. The fact of the cargo being put on board the German ship has tainted that cargo with
[Continued.
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enemy ownership, and the whole of the cargo which is on board the ship is supposed to be enemy cargo because it is on an enemy's ship. Now, in order to get that cargo released, they have to produce before the court, at which the cargo is held proof that they are the legal owners, and that proof can only be supplied by the documenta connected with that cargo?- (Mr. Hughes.) That court is in Cape Town?
79. Yes (Mr. Richards.) That is a great practical difficulty. We will have to arrange that all bills of lading shall be collected in one place, Australia or Cape Town.
80. They should all go to Cape Town -Could not the Government say, "We will substitute one Prize Court for another "P
81. That is what we want to do, but we cannot do it yet it necessitates legislation, and as Parliament rises to-morrow we cannot do it. It will have to go through in the ordinary course --The great thing is to make arrangements to send them out.
82. Do you know where these bills of lading are?— (Mr. Hughes.) Many are in Australia, and many are held by Messrs. Parker, Garrett and Co. here, who were appointed by the underwriters to represent them; some by Crump, and some by Waltons.
83. The bills of lading which are held in this country are quite simple to deal with. They can be sent out to a proper agent in Cape Town with instruc- tions to enter an appearance for each owner and get his release?—(Mr. Richards.) But it will take a long time.
84. Three weeks--well, I suppose it would take a good deal longer than that. But it will not affect your moving the ship?-With great deference, it seems to me that there is a little difficulty, if they will not release the cargo on a guarantee to produce these bills of lading at some time or another.
85. They will release the cargo to the Crown, and the Crown will have to take the risk of all cargo which has not been dealt with by the court. You can get over the difficulty in that way.
(Mr. Ecans.) Is not that going a little bit too far? (Mr. Mulkin.) Why should the Crown take any responsibility?
(Chairman.) The owners of the bills of lading will have to give a hond to the Crown.
88. (Mr. Tennyson.) It might be done in this way, that the Federal Steam Navigation Company might take a release of the cargo, and they might cover themselves with the consignees in some way?-(Mr. Richards.) I gather that is impossible. I gather they will not give a release.
Crown.
(Chairman.) They will only give a release to the
(Mr. Tennyson.) I understand if the Crown with. draws its claim they will give a release to anybody the Crown directs.
way.
(Chairman.) Yes, the Crown can consent in that
(Mr. Tennyson.) And the Crown will be given an indemnity. Mr. Hughes will then cover himself against the consignees, either by insurance or by arrangement with the consigneas.
(Mr. Malkin.) Why cannot Mr. Hughes give an undertaking to the court and get the goods released to him?
(Mr. Tennyson.) The Crown only comes in because the Crown has to consent.
(Mr. Malkin.) That does not involve any liability? (Mr. Tennyson.) No.
87. (Mr. Malkin.) The iden is that Mr. Hughes should have some one at Cape Town to represent him. and a release should be granted by consent of the Crown to that person of all carga which could not be otherwise released because they could not produce their documents of title. That release would be granted un
Mr. Hughes entering into a bail bond for the amount of the cargo so released. That amount he would have to cover by arrangement with the cargo owners.
When the cargo owners could produce their documenta of title they would go to the court and the bail bonu would be cancelled and the transaction would be at an end ?—(Mr. Richards.) That is all right so far as that
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