Judgments

Decision Information

Decision Content

T-3573-71
The Bell Telephone Company of Canada—Bell Canada (Plaintiff)
v .
The Ship Mar-Tirenno and owners (Defendants)
Trial Division, Addy J.—Quebec, January 22, 23 and 24; Ottawa, June 13, 1974.
Maritime law—Damage to underwater telephone cables by the anchor of defendant ship—Wharf extremely exposed to ice movement—Ship breaking away creating dangerous situation—Negligence on part of captain—Inevitable acci-
- lea rejected—No contributory negligence—Action sustained.
Interest Rights in admiralty `matters—Jurisdiction of Court—Higher rates granted—Interest Act, R.S. 1970, c. I-18, secs 11, 13.
The plaintiff's claim is for damages caused by the anchor of the defendant ship to its underwater telephone cables near the Port of Quebec. The defendant ship suffered some damage to its hull on a return trip through the St. Lawrence Seaway. In order to repair the ship, the cargo of grain had to be unloaded at the Port of Quebec because of ventilation facilities. It was decided to tie up at Pier 18 which was the only pier that had special facilities for unloading and storing of grain. The captain was advised to double his lines and maintain constant watch because Pier 18 was an extremely exposed wharf in the winter as the tides shift ice backwards and forwards. The ship did break away, collided with the wharf and continued upstream toward a shore-side restau rant creating a very dangerous situation. The captain ordered the engines to be started, ordered the starboard anchor to be dropped to swing the stern away from the shore and then ordered the port anchor to be dropped to stop the movement of the ship. The anchor hooked on to the plaintiff's cables causing the damage.
Held, the action is sustained. Since the defendant know ingly adopted a dangerous course of action and damage to the plaintiff ensued therefrom the burden of proof shifts to the defendant to justify the dangerous course. The captain was negligent in not having informed himself of the location of the cables when he was warned of the danger of the ice at that wharf. Also, the captain was negligent in not assessing the possible alternatives i.e. moving on to Halifax, or tying up at another wharf at the Port of Quebec or unloading the grain from the forward hold by using the ship's machinery and trucks from the wharf. Although the defendants estab lished that watches had been ordered, they failed to estab lish that the watches carried out their duties properly. The defendants' plea of inevitable accident fails because the breaking away and the resulting damage was clearly foresee able and there was a failure to observe and to carry out any
,reventive action. There is no contributory negligence on the part of the plaintiff. All persons navigating that area are required by law to know of the existence and location of the cables and of the prohibition against anchoring in that area.
The Europa (1850) 14 Jur. 627 at page 629; The Marpesia v. The America (1872) L.R. 4 P.C. 212; The Peterborough v. The Bell Telephone Co. of Canada [1952] Ex.C.R. 462; The John Harley v. The William Tell (1866) 13 L.R. (N.S.) 413, referred to. The Bell Telephone Co. of Canada v. The Rapid (1895-97) 5 Ex.C.R. 413; The Czar (1875) 3 Cook Adm. 197, Bell Telephone Co. of Canada v. Beverley Steamship Co. Ltd. [1944] C.S. 154; B.C. Telephone Co. v. The Arabi- en 34 B.C.R. 319 distinguished.
With regard to interest, the discretion to award or not to award should not depend on whether the defendant was grossly negligent or not since the right to interest in admiral ty law is considered as forming part of the damage caused for which the defendant is responsible, and is a right of the person harmed, once the liability has been established. The Kong Magnus [1891] P. 223; The Joannis Vatis (No. 2) [1922] P. 213 and The Northumbria (1869) L.R. 3 A. & E. 6, followed. Canadian Brine Limited v. The ship Scott Misener [1962] Ex.C.R. 441 disagreed with. Interest should be set at 6% (the commercial rates prevailing at the time) since section 13 of the Interest Act is not applicable to the Province of Quebec.
ACTION. COUNSEL:
Roland Chauvin, Michel Racicot for plaintiff .
Raynold Langlois, Richard Gaudreau for defendants.
SOLICITORS:
Houle, Hurtubise & April, Montreal, for plaintiff.
Langlois, Drouin & Laflamme, Quebec, for defendants.
ADDY J.—The plaintiff's claim is for damages caused by the anchor of the defendant ship to its underwater telephone cables, running between the Cities of Quebec and Levis within the limits of the Port of Quebec.
It appears that the defendant ship suffered some damage to its hull on a return trip through the St. Lawrence Seaway. The ship had been damaged on the 10th of December, 1970, when it collided against the wall in the Saint Lambert Lock. The damage was caused on the port side in the vicinity of hold number 1, both above and below the water line of the ship.
It was decided to proceed to Quebec, as the shore facilities at Sorel, Trois-Rivières and Montreal apparently did not include available ventilated storage for grain. On arrival, the ship was carrying approximately 13,235 tons of vari ous grains. It had approximately 2,336 tons of alfalfa pellets in the forward hold, of which some 1,800 tons were to be discharged in order to permit the repairs to be carried out.
In order to properly effectuate repairs, grain, which had been loaded in the forward hold, had to be discharged and it was decided to tie up at Pier No. 18, which was the only pier that had special mechanical onshore facilities for the unloading and storing of grain. The facilities consisted of two mobile towers on tracks.
The ship tied up to Pier No. 18 during the afternoon of the 13th of December, 1970, after having requested and received permission from the port authorities to do so. The captain was advised to double his lines and to maintain a constant sea watch on the lines, both fore and aft, and also to maintain a constant sea watch in the engine room and on the bridge. This recom mendation was made to him because of the fact that Pier No. 18 is an extremely exposed wharf in the winter-time by reason of the movement of the ice, as the Port of Quebec is subject to tides which shift the ice backwards and forwards as the tides ebb and flow.
The harbour master of the Port of Quebec, one Captain Henri Allard, testified that the orders at the Port were that any vessel tied up at Pier No. 18 was supposed to maintain a con stant state of alertness in case it should be necessary to pull away from the wharf at any time because of the ice. It must be ready to move away at any time with a sufficient com-
element of crew aboard at all times in order to handle it efficiently.
When the ship was originally tied up on the 13th, it was tied to six different bollards on the wharf. Each tie consisted of two separate lines: there were, in other words, two lines' to the forward bollard, two bow lines leading to the port side of the bow, two forward springs, two rear springs, two stern lines leading to port of the stern and two lines leading aft, for a total of twelve lines; on the following day, two addition al lines were added: one forward and one aft, for a total of fourteen lines. There is no doubt that the ship was using about twice the number of lines, as would normally be required in that port, were there no danger from ice. It is worthy to note that, although the ship's captain, when giving evidence, stated that he did not have the impression that any tugs were required to clear the ice from the wharf in order to allow the boat to tie up, the ship's log does contain an entry to the effect that two tugs were required to do this and it seems clear that this occurred.
The captain ordered a sea watch to be main tained on the bridge, consisting of one officer and two seamen. He also ordered an engine watch to be maintained constantly, consisting of one officer and one seaman, and also a watch on the lines forward, consisting of one officer and two men, and a similar watch on the lines aft.
The following day, at approximately 5:45 p.m., after the major part of the 1,880 tons of grain, which were to be discharged from the forward hold, had been removed, all of the lines suddenly parted within a matter of something less than thirty seconds, and the ship moved rapidly up river caught by the ice on the rising tide. The stern of the ship collided almost immediately with a wharf some short distance upriver from the pier, to which it had been secured and, after colliding with the wharf, it continued upstream a very short distance moving again toward shore and creating an imminent and very dangerous situation for the occupants of a shore-side restaurant known as the Riviera Restaurant.
In an attempt to prevent the ship from collid ing with the restaurant and to arrest the ship's motion, the captain, who had been in the saloon at the moment the ship started to move and who rushed immediately to the bridge, issued orders to start the engine and to drop the starboard anchor in order to swing the stern away from the shore. He then, immediately afterwards, gave an order to drop the port anchor in an attempt to stop the movement of the ship which was still proceeding upriver with the ice. During this time the normal procedures were being fol lowed to start up the engine. It appears that it did start after a normal interval of some two or three minutes. Even with the engine going and the two anchors out, the ship continued to move upriver with the ice for a short distance until the anchors finally took hold.
After the ship was stopped in the river and the immediate danger from the ice had subsided and the boat was being controlled by the power of the propeller, an order was given to weigh the anchors. The port anchor was somewhat dif ficult to raise and, when it cleared the ice, it was noticed that the flukes had hooked onto the two submarine cables. The anchor was freed from the cables without too much difficulty, and the ship returned to port.
It is uncontradicted that the cables, which were hooked by the anchor, were those of the plaintiff and that whatever damage was caused to the cables was caused by the anchor of the defendant vessel.
As to the reason for the breaking of the ship's lines, it was established in evidence, and I so find, that the first line to give way was the forward spring. This, in the opinion of the asses sors, is a very clear and irrefutable indication that the cause of the breaking of the lines was the pressure of the ice on the bow and sides of the ship pushing it upriver with the rising tide rather than excessive tension on the bow lines resulting from a possible failure to slacken them, while the grain was being unloaded from number 1 hold and the increased buoyancy for ward was causing the bow to rise. I accept their view on this point and agree with them that there is no evidence to indicate that there was
any undue tension on the bow lines at that time and that all the evidence points to the lines having been broken by reason of the moving ice seizing the ship and carrying it upriver.
The assessors were also of the view that the watches, which the captain ordered, were quite adequate in the circumstances. They were also of the view that, once the lines had broken, the correct orders were given in a proper sequence and that these orders were promptly and effi ciently followed and that there was no apparent faulty seamanship on the part of the crew in freeing the ship from the ice and bringing it under control. They were also of the view that the captain had no alternative but to order the anchors to be dropped, when and where he did, nor do they feel that, once it was noticed that the telephone cables were hooked to the anchor, anything but the proper procedures were adopt ed to free the cables. After carefully reviewing the evidence, I also accept their views on these matters and can find no act nor omission which might constitute negligence on the part of either the captain or any member of his crew, subse quent to the time the cables broke, nor is there any evidence of defective equipment or ma chinery which might have caused or contributed to the mishap.
While dealing with the machinery and equip ment, it is remarkable that no evidence whatso ever was adduced by either side as to the actual condition of the lines. When a line breaks, it does so because it is not of sufficient strength to resist the type and degree of strain put on it and the first question which naturally comes to mind is what the condition of the line was at the moment it was put under strain. One would have thought that, had the lines been in good condition, the defendant would have been most anxious to establish this fact and, conversely, had they not been, the plaintiff would have been equally as anxious to establish their defective condition.
Since there was no evidence either way regarding the actual condition of the lines as to wear and tear and since, in the assessors' view,
the gauge and composition of the lines were quite normal, having regard to the size of the ship, no fault can be imputed to the defendants for maintaining inadequate equipment from the mere fact that the lines failed to hold the ship, since, again according to the assessors, the force of the ice with the rising tide would create an almost irresistible strain on any lines. Fur thermore, the onus would be on the plaintiff to establish defective lines if it were relying on that fact as constituting negligence.
The case, in my view, therefore, turns on whether there was any negligence on the part of the captain or any member of his crew in tying up to that wharf in the first place, or in the manner in which the ship was secured or remained there, or in remaining there at all, and finally, whether he and his crew took all precau tions, which normally should be taken to avoid the ship breaking away from its moorings as it did, including constant and proper observation of all conditions which might affect the security of the ship.
Where a person has actual dominion and con trol over an object or has a legal duty to control it and that object goes out of control and causes damage, then, it is obviously up to the person in control to explain by positive evidence the reason why the object went out of control or, at least, to establish by positive evidence that it was not due to any act or omission on his part or on the part of any other person whose actions were under his control.
The evidence is clear that, although this was the captain's first experience in a port under conditions of ice, he was specifically warned, at least twice, of the danger of ice. He was told that he should double his lines, maintain a sea watch forward and aft on the lines, and also maintain engine and bridge watches at all times. He did, in fact, double his lines and order the recommended watches to be maintained. He was warned that there was a danger from the ice, but there is no evidence whatsoever that he even attempted to inform himself of the precise nature of the danger or of the extent of the danger.
As to the captain's failure to inform himself of all of the conditions of the port, which might affect his ship, he admitted at trial that he knew of the existence of the submarine cables but did not know of their location because the charts he had aboard did not indicate them. The assessors informed me that, for many years, the position of these cables was indicated on marine charts of the St. Lawrence. The ones filed at trial clearly indicated the position of the cables and the publication covering the typography and facilities of the Port of Quebec also indicated their location. In the same way that failure to consult a chart constitutes negligence, (refer The Sub-marine Telegraph Company v. Dickson'), failure to have up-to-date charts aboard would equally constitute negligence. It is true that the lack of knowledge in this case might not have contributed to the damage. At the very least, this is evidence of the failure of the captain to inform himself fully of the condi tions when he knew he was assuming a risk by tying up at Pier No. 18. This must also be considered in the light of the evidence of the captain when, even at the time of trial, he admit ted that he did not yet know whether any member of his crew had ever had any experi ence in the handling of a ship in a port where ice was present. One would think, since he had no experience whatsoever himself, he would, at the very least, have informed himself as to whether any crew member possessed any.
The assessors advise me that under certain conditions of ice and tide the force exerted by ice could not be overcome by doubling or, at times, even tripling the lines and, to that extent at least, the force might be considered as irre sistible and, for that reason, the wharf in ques tion was considered extremely dangerous in winter and was to be avoided, except in condi tions of extreme emergency. I accept their advice on this matter. But again, there is no evidence whatsoever that the captain was aware of this nor was there any evidence that he made any attempt whatsoever to inform himself of that fact. Had he done so, he might never have
7- [18641 C.B.N.S. 758.
tied up at the wharf at all, but might well have chosen to move on to Halifax (there was no evidence adduced that he could not have pro ceeded to Halifax), or he might very well have decided to tie up at some other wharf at the Port of Quebec and to unload the grain from the forward hold by using the ship's machinery and trucks from the wharf.
The tying-up at the wharf in question, without informing himself fully, or, at least, taking all reasonable steps to inform himself fully of the nature and extent of the danger and, more specifically, of the very great force which the ice would exert on a ship on a rising tide at that particular wharf, constituted negligence on the part of the captain. He chose to merely accept the fact that there was a danger and to accept, without knowledge of the extent of it, the recommendations the two persons in question chose to make. As a result of that negligence, the very situation, which would otherwise have been foreseen or which, most probably, would have been foreseen had the captain not neglect ed to inform himself, arose and, as a direct result and a clearly foreseeable result thereof, the lines broke and the ship was put in a peri lous situation and in a state of emergency which, in order to avoid the very real danger of loss of life to the occupants of the Riviera Restaurant, necessitated the dropping of the anchors.
Not only is the chain of causality unbroken but all of the ensuing events, including the emergency anchoring, were clearly foreseeable.
It is, of course, trite law to state that one cannot be excused by reason of actions result ing from the existence of a state of emergency when the emergency itself is caused or con tributed to by one's own negligence, and it mat ters not whether the negligence is founded on misfeasance or on nonfeasance. Where it is the duty of a person to inform oneself of the nature and extent of a dangerous situation, knowledge of the nature and extent of the danger will be imputed to that person and his actions will be judged as if, at the time of the act or omission,
he actually had the knowledge which it was his legal duty to acquire.
Finally, once a plaintiff has established that a defendant has knowingly adopted a dangerous course of action and that damage to the plaintiff has ensued therefrom, he has discharged his burden of proof, at least temporarily, and the burden shifts to the defendant to justify his having taken such a dangerous course. Without any such evidence by the defendant, as a matter of reasoning and of fact the plaintiff would necessarily succeed.
The captain exposed his ship to a very dan gerous situation, which was dangerous not only for his ship and its crew but dangerous for others and for the property of others. The extent of that danger is uncontradicted; he was not acting under a situation of immediate emer gency since the ship had been damaged in Mont- real three days previously and had proceeded to the Port of Quebec without any evident change in the condition of the vessel or its cargo having been proven in evidence. In such a case, it is obvious that the defendants must establish that there was no other reasonable alternative open to the ship but to put itself in that particular situation and then must establish also that, having taken the risk, all precautions, which could reasonably have been taken, were adopt ` ed having regard to the nature and extent of the danger.
As to the first part of the test, the defendants, as stated previously, failed to establish that sail ing on to the Port of Halifax, or unloading at another pier in Quebec, would not be other reasonable alternatives which could have been adopted in lieu of tying up at Pier No. 18. There might well have been other reasonable courses open to the defendant ship but, in any event, it has failed to establish that there were no other reasonable and less dangerous alternatives open to it. As to the second portion of the test, there is a lack of evidence that the very danger, which should have been anticipated, was ever observed by any member of the crew of the ship. There is no evidence that any crew member ever noticed the ice approaching with the rising tide. Had this been done, then, other actions might well have been taken such as
giving immediate orders to start up the engine before the lines actually broke in order to assist the lines in withholding the strain of the ice. The captain gave specific orders that watches were to be maintained and he and his officers did carry out periodic inspections. However, for the period of some one-and-a-half hours immediate ly preceding the accident, there is no evidence whatsoever that the people who were detailed to the watches, actually carried out their duties or that those detailed to slacken and to keep watch over the lines were actually doing so. This, coupled with the fact that no member of the crew was called to give any evidence as to what observations were made of the ice previous to the lines breaking, leads me to the conclusion that, although the defendants established that watches had been ordered, they failed to estab lish that the watches carried out their duties properly.
There was a failure to observe and to carry out any preventive action. The defendants, in this case, plead inevitable accident and, in order to succeed, they must establish that all reason able precautions were taken to avoid the mishap and that the accident itself was inevitable in the sense that it could not be reasonably foreseen or, if foreseen, could not be guarded against by using all reasonable precautions under the circumstances.
Inevitable accident has been defined as an accident "which a party charged with an offence could not possibly prevent by the exer cise of ordinary care, caution and maritime skill." This definition is to be found in The Europa 2 and was approved by the Privy Council in The "Marpesia" v. The "America " 3 and was also adopted by Cameron J. (as he then was) when sitting on appeal from a judgment of a district judge in admiralty for the Quebec Admi ralty District in The Peterborough v. The Bell
2 (1850) 14 Jur. 627 at page 629.
3 (1872) L.R. 4 P.C. 212.
Telephone Co. of Canada 4 . Since inevitable accident is a state of affairs relied upon by a defendant to exist in order to avoid liability, its existence must be established affirmatively by the person relying upon it, namely, the defend ant. See Burrard Terminals Ltd. v. Straits Towing Ltd. 5 ; The Merchant Prince 6 ; Tremblay v. Hyman'; Poplar Bay _ Steamship Co. v. The Charles Dick 8 ; also the Peterborough case, (supra). The same principles as to onus apply to a plea of an act of God. See Carver's Carriage By Sea by Colinvaux 9 . Exceptional currents, which only occur on rare occasions, do not constitute an act of God. See The Kepler 10 ; The Pladda "; and The "Velox " 12 .
The breaking away, which caused the acci dent, was clearly and distinctly foreseeable and, in fact, foreseen and was the object of two separate warnings; the resulting damage was also clearly foreseeable. The accident was, therefore, not of the type of rare occurrence which normally characterizes an inevitable acci dent at law. In view of this, the burden on the defendant ship of establishing that it "could not possibly prevent it by the exercise of ordinary care, caution and maritime skill" is greatly com pounded, and, in my view, for the same reasons mentioned above which constitute negligence on its part, the defendant ship also fails in this particular defence. In addition thereto, as to the defence of inevitable accident, it , is worthy of note that there were two icebreakers available in the vicinity and no explanation was given as to why the icebreakers were not engaged to
4 [1952] Ex.C.R. 462.
5 (1965) 50 D.L.R. (2d) 41.
6 [1891-4] All E.R. Rep. 396.
7 (1917-21) 20 Ex.C.R. 1.
8 [1926] Ex.C.R. 46.
9 Vol. I, 12th Ed. paras. 9, 10, 11. (British Shipping Laws—Vol. 2).
10 (1876) 2 P. 40.
" (1876-7) 2 Prob. Div. 34.
12 [1955] 1 Adm. 376 at page 380.
stand off in front of the vessel in order to attempt to break up any large ice flow before it actually reached the defendant ship. I would have thought also that, since the anchor chains were strong enough to hold when hooked to the cables, they would have been strong enough to secure the ship to the wharf instead of using lines. The assessors, however, felt that this was not a recognized procedure in this part of the world, although used in the Mediterranean when hurricane warnings were given. Be that as it may, the accident cannot be said to be inevi table when clearly foreseen and when it has not been affirmatively established that there were no other reasonable alternatives open.
Where the plaintiff has established that the damage originated from the ship breaking away from its moorings, the defendant ship must explain how this happened without negligence on the part of its crew or by reason of faulty equipment. See The John Harley v. The William Tell 13 .
The case of Bell Telephone Co. of Canada v. Beverley Steamship Co. Ltd. 14 relied on by the defendants is not, in my view, of great assist ance. In this particular case, the ship was anchored in an authorized anchorage. It was held that, on the facts, the ship was properly anchored and that there was no negligence whatsoever in the manner in which the ship had anchored. Subsequently, a completely unexpect ed hurricane arose, which wrecked many ships, and caused the anchors of the defendant ship to drag and finally catch in the telephone cables. It was held that the ship was not responsible for the damage caused in hooking the cables, but, it was found responsible for the manner in which the cables were disengaged from the anchors— the ship's crew having cut the cables instead of taking proper steps to disengage them.
The case of British Columbia Telephone Com pany v. The Arabien i 5 . is not very helpful either to the defendant ship. Although it was held in that case that the plaintiff had failed to dis-
i3 (1866) 13 L.R. (N.S.) 413.
14 [1944] C.S. 154.
15 34 B.C.R. 319.
charge the onus of proving negligence, there was no indication as to the grounds of the finding in the report of the case; on the con trary, the trial Judge stated that his conclusion was a result of careful consideration of all of the facts but that he was refraining from review ing the facts.
In the case at Bar, the defendants also allege that the plaintiff was interfering with rights of navigation and was, therefore, the author of its own misfortune, or, at least, contributorily neg ligent. The plaintiff enjoyed a valid easement entitling it to have its cables installed where they were. Navigable waters such as the St. Lawrence River have often been likened to public highways giving one the right to navigate, pass and repass at all times and states of the tide.
There is no doubt that the easement granted to the plaintiff _ does not entitle it to interfere with the ordinary rights of navigation any more than the ownership of the soil on which the cables are laid would do so. Refer to Mayor of Colchester v. Brooke 16 and The Swift".
But the rights of navigation in territorial waters are necessarily restricted. Among the many restrictions, one finds prohibition against anchoring in certain areas. The installation and maintenance of cables on the bottom of a river, in an area where anchoring is prohibited, is not an interference with the rights of navigation since the rights to navigate in this area do not include the right to anchor there.
It would not have been necessary for the vessel to drop anchor at that place in the river if the master and crew had used proper care in the first place. Refer Bell Telephone Co. of Canada v. Canada Steamship Lines, Limited 18 . '
16 7 Q.B. 339.
17 [1901] P. 168.
18 (1938) 76 C.S. 473 at page 477.
For the above reasons, it is clear, in my view, that negligence has been established against the defendant ship and that it has failed in its plea of inevitable accident.
As to the existence of contributory negligence on the part of the plaintiff, I was somewhat concerned over the argument that, notwith standing its knowledge that its cables had been hooked on many occasions previously by ships' anchors, the plaintiff continued to maintain them between the Cities of Quebec and Levis in the middle of a very busy port, when the same cables could presumably be installed elsewhere or perhaps encased in cement in such a way that ships' anchors could not catch in them.
The fact that the cables were installed, within the limits of the Port of Quebec, undoubtedly increased the possibility of damage occurring to the cables, having regard to the number of ships, which not only pass by but which ma noeuvre about the area, tie up at the various piers and anchor in the authorized anchorages in the general area of the Port. The installation, however, does not in any way constitute a hazard to navigation as lawfully authorized in that area; it does not, in fact, interfere with the manoeuvring of ships on the surface over the cable area, which is all that the ships are entitled to do in that particular place. The position of the cables is clearly indicated on up-to-date naviga tional charts and the official releases of publica tions covering navigation and piloting on the St. Lawrence. All persons navigating in that area are required by law to know and, therefore, are presumed at law to know of the existence and location of the cables and of the prohibition against anchoring in the area. The plaintiff was, therefore, entitled to assume that the defendant ship knew these facts. The plaintiff was further more entitled to assume that the defendant ship would act lawfully, in a reasonable and prudent manner, and in accordance with the recognized standards of seamanship and failure on the plaintiff's part to take all precautions, which might be required to guard against any possible damage to itself or its property arising out of the negligent or unlawful acts or omissions of other parties, does not constitute negligence on its part in the circumstances of this case. I fail to
see how the maintenance of cables in a lawful place, where they create no hazard whatsoever to navigation as authorized and where they can only be damaged by either a deliberate unlawful act or a negligent act of another party, can constitute contributory negligence on the part of the plaintiff.
There were many cases where damages were claimed by the plaintiff herein resulting from ships' anchors hooking its cables in the Port of Quebec in the very area where the present damage occurred, yet, in no case did the Courts find any contributory negligence. In many of these cases, contributory negligence was alleged and pleaded. I do not intend to review all of them here but it is interesting to note that in the Peterborough case, (supra), there was a claim of contributory negligence against the company for the manner in which the cable was laid and the Trial Court, upheld on appeal, found that there was nothing in the laying of the cable which indicated negligence. It is true that each case turns on its facts and that another case cannot be used to interpret the facts in the case at Bar, but, I can find no facts whatsoever in the case at Bar different from those in the Peterborough case which would indicate contributory negli gence on the part of the plaintiff, The Bell Telephone Company of Canada. Another case in point, which also happens to deal with the same cable in Quebec Harbour, is The Bell Telephone Company of Canada (Limited) y. The "Rapid " 19 . Here again, the Court found that there was no negligence on the part of the plaintiff in placing its cable at this particular point since it had full permission to do so and that anchorage in that particular area was prohibited.
19 (1895-97) 5 Ex.C.R. 413.
Another case where underwater cables were damaged by a ship anchoring in Quebec Har bour, and that no contributory negligence was found against the plaintiff, is the case of The "Czar'no.
It is interesting to note also that in all of these cases nothing more and nothing less was done by the plaintiff which might lead one to con clude that there was contributory negligence on its part than in the case at Bar.
I come now to the question of damages. Of the total amount of $228,414.80 of damages claimed, the defendants, by joint admissions, filed as Exhibit No. 13 at trial, admitted the sum of $190,447.67 as damages properly arising from the accident.
The defendants claim that a depreciation of $6,090.55 should be allowed on one of the two cables, that is, cable number 517, since it was one-and-a-half years old and that the plaintiff was getting a new cable in return. It was clearly established that it was necessary to put in a new cable as the old cable could not be repaired. The plaintiff is entitled to restitutio in integrum but to no more. A depreciation as such should not be calculated but it is the duty of the Court to consider the value of the object destroyed at the time of destruction in order that the object can be replaced by money's worth.
Joint admissions, filed as Exhibit No. 13, established the life of the cable as being thirty years and on that basis the value of the cable destroyed can be fairly established at the cost of a new one less the sum of $6,100.00. That amount should, therefore, be deducted from the total claim of $228,414.80.
The defendants claimed further that, as one of the two cables, namely cable number 517, was replaced in January 1971 and the other, namely cable number 518, was replaced in the summer, an allowance of some $31,876.58 should be made, as this represents the increased
20 (1875) 3 Cook Adm. 197.
cost of installing number 517 in winter-time as opposed to summer installation. This argument, in my view, is completely answered by the fact that both cables were in actual service; cable 517 carried 689 pairs and it is reasonable to deduce that these lines were required to supply the plaintiff's service to its customers. Commer cial enterprises, such as that of the plaintiff, do not install expensive cables unless there is a business requirement for them. The mere fact that the plaintiff was 'able to operate with one cable in lieu of two until the summer-time, when the second cable was replaced, is not evidence from which we can conclude that neither cable was required until summer. In the absence of evidence that both cables might have been dis pensed with, I find no difficulty in coming to the conclusion that on the balance of probabilities the first cable was required to be replaced immediately.
The plaintiff claims interest on the total amount of damages and the defendants dispute this amount.
It is clear that this Court, under its admiralty jurisdiction, has the right to award interest as an integral part of the damages suffered by the plaintiff regardless of whether the damages arose ex contractu or ex delicto.
The Admiralty Courts, in the exercise of their jurisdiction, proceeded upon different principles from that on which the common law authorities were founded; the principle in this instance being a civil law one, to the effect that, when payment is not made, interest is due to the obligee ex mora of the obligor. Refer Canadian General Electric Co. Ltd. v. Pickford & Black Ltd. 21 ; Canadian Brine Limited v. The Scott Misener 22 and the authorities stated therein at pages 450 to 452. Since the principle is based on the right of the plaintiff to be fully compen sated, including interest, from the date of the tort, I am not, however, prepared to hold, as seems to have been done in the Canadian Brine case, (supra), that the discretion to award or not
21 (1971) 20 D.L.R. (3rd) 432 at page 436.
22 [1962] Ex..R. 441.
to award interest should depend on whether the defendant was grossly negligent or not. Since the right to interest in admiralty law is con sidered as forming part and parcel of the damage caused for which the defendant is responsible, and is a right of the person harmed, flowing from the actual commission of the tort, I fail to see how, once the liability for the damage has been established, the question of whether or not there has been gross negligence on the part of the tortfeasor phould be taken into consideration, in any way: interest in these cases is not awarded to the plaintiff as punitive damages against the defendant but as part and parcel of that portion for which the defendant is responsible of the initial damage suffered by the harmed party and it constitutes a full application of the principle of restitutio in integrum. See The Kong Magnus 23 ; The Joannis Vatis (No. 2) 24 ; and The Northumbria 25 . In the present case, although I find that there indeed was negli gence, it is not a case of gross negligence. Yet, notwithstanding this, I am satisfied that the in terest should be awarded unless there should be some reason flowing from the plaintiff's con duct or some reason to reduce or eliminate the claim for payment of interest, other than the question as to whether there was or was not gross negligence on the part of the defendants.
The action originated in the former Excheq uer Court and was commenced by writ. The statement of claim issued in the French lan guage, reads in part as follows:
... avec intérêts depuis l'assignation et dépens.
This would mean the date of service of writ and not of the statement of claim. Since the plaintiff has not claimed interest from the date of the accident but merely from the date of service of the writ and since no amendment of the state ment of claim has ever been requested, it is obvious that this Court cannot award interest for any time previous to the service of the writ. Had the statement of claim merely mentioned
23 [1891] P. 223 at page 236.
24 [1922] P. 213 at page 223.
23 (1869) L.R. 3 A. & E. 6 at pages 10 and 14.
interest without any specific time I would then have been obliged to consider whether interest should be awarded from the actual date of the accident. Since the second cable was not replaced until the summer-time and there was no evidence to establish that there was any real necessity for replacing it before that time, and the plaintiff was not put to the expense of replacing it before that time, interest, in the case of the second cable, should run from the time of actual replacement on the basis of the principles stated by Lord Denning M.R., and approved by Jackett P. (as he then was) in the case of Canadian General Electric Co. v. The "Lake Bosomtwe" 26 . The relevant passage of Lord Denning M.R.:
(a) When a profit earning ship was sunk in a collision, the Court of Admiralty awarded interest on the value of the ship ... from the date of the loss to the date of the trial,
(b) When a ship was not sunk, but only damaged, the Court of Admiralty awarded interest on the cost of repairs, but only from the time that the repair bill was actually paid, because that was the date from which the plaintiff had been out of pocket, and
(c) Where there was loss of life in a collision, the Court of Admiralty allowed interest only from the date of a regis trar's report.
Due to the fact that admissions were made by statement of admissions, filed as Exhibit 13, as to the total cost only and no detail' was fur nished as to the actual cost of the two cables, it becomes most difficult, on the evidence before me, to separate exactly the cost incurred in purchasing and installing both sets of replace ment cables, except that the admitted difference between the cost of laying the new cable to replace cable number 517 in the wintertime and to replace number 518 in June was $31,876.58. Deducting this from the total amount of $222,- 314.80 leaves $190,438.22. One-half of this amount or $95,219.11 would presumably repre sent the actual cost of purchasing and installing the replacement for cable number 518 in the summer-time and the balance of the amount of $222,314.80, namely, $127,095.69 would repre-
26 [1970] Ex.C.R. 552 at 558—NOTE: This case was reversed on appeal: ref. (1971) 20 D.L.R. (3rd) 432. But the principle as to interest being allowed in all admiralty cases was approved.
sent the cost of purchasing and installing the replacement for cable number 517.
As I can find nothing in the conduct of the plaintiff, or in the circumstances of the case to deny interest, interest would therefore run from the date of service of the writ, namely, from the 15th of December, 1970 on the sum of $127,- 095.69 and from the 15th of June 1971 on the sum of $95,219.11.
As to the rate of interest, although in the past most cases have been awarding interest at the rate of 5%, in view of the great increase of interest rates generally over the last few years, it seems to me that a rate of 5% interest is completely unrealistic altogether apart from the legal rate of interest which runs on judgments once they are rendered. Section 13 of the Inter est Act 27 provides that every judgment shall bear interest at the rate of 5% in the Provinces of Manitoba, British Columbia, Saskatchewan, Alberta, the North-West Territories and the Yukon Territory. Other provinces have fixed rates of interest laid down by their provincial statutes, but these rates of interest cover inter est on a judgment debt. Other statutes provide for a rate of interest to be paid on monies paid into Court.
It seems clearo me, however, that if one is to consider the right of the plaintiff to interest as a part of his damage under principle of restitutio in integrum, then, in order to be fair, the actual commercial rate of interest prevailing at the time should be applied regardless of what rate of interest a judgment debt should bear at this time or what rate of interest any govern ment at the time should choose to pay on monies paid into Court. In the last year and a half, interest rates generally and prime bank rates have risen in a most spectacular fashion. In that period the prime bank rate has risen from 6% to something around 9i% and one might well speculate whether, until judgment and as long as the amount is unpaid, the rate that should be applied should, in fact, be the prime bank rates which have prevailed from time to time until judgment. But this point was
27 R.S.C. 1952, c. 156, (now R.S.C. 1970, c. I-18).
never raised by the plaintiff and I refrain from deciding the issue or making any finding based on that view, for it would be grossly unfair in any event to award damages on a basis which was never claimed or raised in the pleadings, or in evidence or argued at trial.
As a suitable yardstick and good indication of what would be fair, would be the prime bank lending rate prevailing at the time that the right to calculate interest as part of the damage arose. At the date of the accident and the date when the writ was issued, as well as at the dates when the expenditures for repairing the cables were made, the prime bank lending rate of interest was identical, namely 6%, and interest shall therefore be calculated at that rate.
Judgment will, therefore, issue in favour of the plaintiff in the amount of $222,314.80 plus interest at 6% per annum on the sum of $127,- 095.69 from the 15th of December, 1970 and on the sum of $95,219.11 computed from the 15th of June, 1971 until date of judgment. The plain tiff will also be entitled to its costs.
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