T-3171-75
Dollina Enterprises Limited (Plaintiff)
v.
John Michael Wilson-Haffenden, Ronald Lindsey
Smith, Harold Fenton and Eberhard Baehr and all
other persons having claims against the plaintiff,
its ship Joan W. II or the fund hereby to be
created (Defendants)
Trial Division, Mahoney J.—Vancouver, April 6, 7
and 28, 1976.
Maritime law—Ships colliding—Defendants found entitled
to recover 100% of damages—Total assessed at $99,964—
Plaintiff bringing action to limit liability—Canada Shipping
Act, R.S.C. 1970, c. S-9, ss. 647(2)(d),(f), 651(1)—Collision
Rule 24(a), SORl65-395—Gold Franc Equivalent Order,
SOR/75-369.
A collision occurred between plaintiff's vessel and defend
ants' vessel, and this Court held that defendants' damages,
some $99,964, were totally recoverable. Plaintiff's appeal
against the Prothonotary's report was dismissed, and this action
to limit liability was commenced.
Held, the action is dismissed; plaintiff cannot limit its liabili
ty. It is a basic proposition that if a shipowner engages a master
whom he has good reason to believe is fully competent to
perform his duties, in the absence of other circumstances, the
owner cannot be found at fault for, or privy to, acts or
omissions of the master while performing a duty entirely within
his sphere of responsibility. The skipper of plaintiff's vessel was
performing a duty wholly within his sphere of responsibility;
however, the standard by which the shipowner must measure
the master's competence is that of the ordinary, reasonable
shipowner. While there is no question of privity here, there is
fault. Had the shipowner's standard been that of the reasonable
shipowner, he would have satisfied himself by examination that
the master would navigate safely, and, if not so satisfied, would
have issued appropriate orders. The owner here did neither,
thereby contributing to the accident. As to the amount of the
limitation which would have arisen, had plaintiff been so
entitled, defendants' argument that, under section 651(1)(b) of
the Canada Shipping Act, the Canadian dollar equivalent of
1,000 gold francs should be established with reference to the
date of the mishap, and that since there was then no specifica
tion by the Governor in Council, the market price of gold at
that date should be the basis is consistent with the general
common law principle. However, there is no evidence that the
market price was $91.50 per troy ounce at the date of the
collision (on which defendants' amount was based) nor that the
market price was the accepted basis of such calculations before
the making of the Gold Franc Equivalent Order.
Lennard's Carrying Co. v. Asiatic Petroleum Co. [1915]
A.C. 705; Stein v. The "Kathy K" (1976) 62 D.L.R. (3d)
1; Standard Oil Co. of New York v. Clan Line Steamers
Ltd. [1924] A.C. 100 and Gatineau Power Co. v. Crown
Life Insurance Co. [1945] S.C.R. 655, applied. The
"Empire Jamaica" [1956] 2 Lloyd's Rep. 119, [1957]
A.C. 386; The "Lady Gwendolen" [1964] 2 Lloyd's Rep.
99 (Q.B.), [1965] 1 Lloyd's Rep. 335 (C.A.), [1965] P.
294, agreed with. The "Abadesa" (No. 2) [1968] P. 656,
[1968] 1 Lloyd's Rep. 493 and The "Mecca" [1968] P.
655, [1968] 2 Lloyd's Rep. 17, discussed.
ACTION.
COUNSEL:
J. R. Cunningham and P. G. Bernard for
plaintiff.
T. P. Cameron for defendant Wilson-Haffen-
den.
S. H. Lipetz for defendants Smith, Fenton
and Baehr.
SOLICITORS:
Macrae, Montgomery, Spring and Cunning-
ham, Vancouver, for plaintiff.
McMaster, Bray, Cameron & Jasich, Van-
couver, for defendants.
The following are the reasons for judgment
rendered in English by
MAHONEY J.: This is an action for limitation of
liability under the provisions of section 647 et seq.
of the Canada Shipping Act' ensuing upon a
collision between the fishing vessel Joan W. II,
owned by the plaintiff, and the fishing vessel All
Star, owned by the defendant, Wilson-Haffenden,
and crewed by Wilson-Haffenden and the defend
ants, Smith, Fenton and Baehr. By a judgment of
this Courte those defendants, plaintiffs in that
action, were adjudged to be entitled to recover
100% of their damages from the defendants, and
each of them, in that action, namely: the plaintiff
herein, the ship Joan W. II and her master, Wil-
liam Crewe. A reference to the Prothonotary for
assessment of damages was ordered and interest at
5% per annum from the date of judgment to the
date of payment was awarded along with costs.
The Prothonotary assessed the total damages at
$99,964, exclusive of interest, distributed as fol-
R.S.C. 1970, c. S-9.
2 Action No. T-1774-73.
lows: Wilson-Haffenden $74,276; Smith $7,988;
Fenton $9,050 and Baehr $8,650. The plaintiff
herein appealed against that report and that
appeal was dismissed. The plaintiff then com
menced this action.
It is purely coincidental that this action, as the
original action for the determination of liability
arising out of the collision, has come on for trial
before me. As a matter of fact, had it not been for
the settlement of another action a very few days
before this hearing another judge of this Court
would have presided at this trial. The foregoing
comment is pertinent because of the apparent
assumption of at least two of the three counsel
appearing at this hearing that I would take into
account evidence presented at the trial of action
No. T-1774-73 but not introduced at this trial. It
seems to me that such a course of action would be
most improper. In particular, I do not think that I
can have regard to the Preliminary Act filed by
either of the parties in action No. T-1774-73. On
the other hand, counsel for the defendant, Wilson-
Haffenden, utilized the transcript of the evidence
given by Captain Crewe at the trial of action No.
T-1774-73, in his cross-examination of Captain
Crewe. No objection was raised and it seems to me
the portions only of that transcript that were read
into the record of this trial are properly in evi
dence. My reasons for judgment in that trial were
introduced as an exhibit and the judgment itself as
well as the report of the Prothonotary and the
judgment dismissing the appeal against it are,
notwithstanding failure to comply with section
23(1) of the Canada Evidence Act 3 , necessarily
before me by virtue of admissions in the pleadings
herein. Accordingly, the copies of the judgment
and report in action No. T-1774-73 submitted by
counsel during argument and marked Exhibits "B"
and "C" will be received in evidence; the copy of
the Preliminary Act of the plaintiffs in that action
marked "A" will not be received.
3 R.S.C. 1970, c. E-10.
The relevant provisions of the Canada Shipping
Act are:
Limitation of Liability
647. (2)• The owner of a ship, ... is not, where any of the
following events occur without his actual fault or privity,
namely,
(d) where any loss or damage is caused to any property,
other than property described in paragraph (b), or any rights
are infringed through
(i) the act or omission of any person, whether on board
that ship or not, in the navigation or management of the
ship,...
(ii) any other act or omission of any person on board that
ship;
liable for damages beyond the following amounts, namely,
(f) in respect of any loss or damage to property or any
infringement of any rights mentioned in paragraph (d), an
aggregate amount equivalent to 1,000 gold francs for each
ton of that ship's tonnage.
651. (1) For the purposes of sections 647 and 650
(a) the tonnage of any ship that is less than three hundred
tons shall be deemed to be three hundred tons; and
The following facts are undisputed:
1. The plaintiff was owner of Joan W. H.
2. Norman W. Fiddler, the plaintiff's President
and Managing Director is "the person whose
action is the very action of the company", 4 in
other words, the person whose "actual fault or
privity", if any, is to be attributed to the corpo
rate plaintiff.
3. William Crewe was the only person engaged
in the navigation of Joan W. II at times material
to the collision with All Star.
4. The tonnage of Joan W. II is less than 300
tons.
William Crewe was born at Dawson Cove, New-
foundland, and started fishing on the Grand Banks
with his father, at the age of 11. He served as a
seaman with the Norwegian Merchant Marine
during World War II and then returned to fishing
out of Nova Scotia ports. Soon after, at the age of
24, he had his first command. He continued to
" Lennard's Carrying Co. v. Asiatic Petroleum Co. [1915]
A.C. 705 per Viscount Haldane L.C. at p. 714.
work in the east coast fishery, as skipper or crew
man as opportunity presented itself, until 1958
when he moved to British Columbia. He worked in
the west coast fishery as crewman until 1962 and,
from 1962 to 1965, as skipper or crewman. During
1965, he started to work exclusively as a skipper
and has continued in that capacity for various
employers. He seems to have worked as steadily as
the nature of his calling permits except that,
during 1972, he did not fish at all. He has no ticket
and is not required to have one.
Norman W. Fiddler has been fishing on the west
coast since 1929, when he was 13. He has been
master of various fishing boats since 1939 or 1940.
He caused the plaintiff to be incorporated in 1944.
All its shares are owned by Fiddler and his wife.
At one time Fiddler, in partnership with his broth
er, owned and managed 11 fishing boats and, at
the same time, commanded one of them. There is
no evidence as to how many, if any, boats other
than Joan W. II, Fiddler or the plaintiff owned or
managed during 1973.
Fiddler was looking for a skipper for Joan W. II
for the 1973 fishing season and heard of Crewe
through the B.C. Independent Co-op, an organiza
tion concerned with the marketing of its members'
catch embracing about half Vancouver's independ
ent fishing boat owners. He contacted Crewe
because he had the reputation of being "a good
producer and a good skipper". On cross-examina
tion, Fiddler acknowledged that Crewe's reputa
tion as a good skipper was founded on the fact that
nothing bad was said about him. They met over a
cup of coffee and made their deal.
Joan W. II had been extensively overhauled
during the winter of 1972-73. New engines had
been installed. Fiddler sailed as a crewman on her
first two voyages of the 1973 fishing season. This
appears to have been dictated by an interest in her
performance after the overhaul and not by any
concern for Crewe's ability. In any case, there is
no evidence of any incident out of the ordinary
during those two voyages, and Fiddler found noth
ing in Crewe's performance that he thought worth
while discussing with him. Those voyages were
followed by two more that passed without incident.
The collision occurred soon after Joan W. II had
left Vancouver on her fifth voyage. Five more
voyages, again without incident, ensued that year
with Crewe in command.
Crewe says that Fiddler gave him no instruc
tions as to the navigation of Joan W. II prior to the
collision. He says that he would have followed
them had they been given. His attitude is that
Fiddler was the owner and had a right to call the
shots. Fiddler says that he did suggest that with
the new engines, Crewe ought not to run the vessel
at full speed at night. He also says that he told all
his skippers "not to take unnecessary chances".
Specifically, Fiddler was satisfied by his observa
tions during the two voyages, which consumed
something in the order of five weeks in all, that
Crewe was very familiar with the radar and other
navigational aids on the vessel.
There was, on board the Joan W. II, a copy of
the 1972 edition of Capt. Lillie's Coast Guide and
a log book, both containing information to assist in
navigation. The Coast Guide set out the whistle
signals to be given in various situations and para
phrased collision Rule 24(a) while the log book set
forth Rule 24(a) verbatim, if without attribution. 5
It was Joan W. II's clear violation of Rule 24(a),
coupled with the absence of evidence of negligence
contributing to the collision on the part of All
Star, that led to the finding that Joan W. II, her
skipper and owner were entirely liable.
The collision occurred between 2 and 2:30 a.m.
on May 8, 1973. It was a rainy, blustery night with
at least patches of fog. Joan W. II and All Star
were running on much the same course, All Star
having left port first. All Star was proceeding at a
5 SOR/65-395, P.C. 1965-1552.
Rule 24
Overtaking
(a) Notwithstanding anything contained in these Rules,
every vessel overtaking any other shall keep out of the way of
the overtaken vessel.
speed of about seven knots and Joan W. II at
about eight knots. Crewe was alone in the wheel-
house of Joan W. II operating with radar and on
automatic pilot. On All Star, Wilson-Haffenden
had turned over the wheel to Smith a short time
before the collision and was still in the wheelhouse.
Their observations of each other, as set forth in the
Reasons, follow:
Prior to turning over the wheel to Smith, Wilson-Haffenden
had first seen another vessel's mast light and running lights
slightly to port at a distance he estimates at two miles. He saw
it again about '/a mile back and recognized it as a dragger. He
told Smith to keep an eye on it. They saw it again 100 yards to
port and 100 feet astern. It seemed to be passing safely. On his
orders, Smith altered course one point to starboard. The next
thing he knows is that Smith said "He's going to hit us". The
only thing he saw immediately before the collision was Joan W.
II's port running light. Smith's evidence is to the same effect:
that at one moment the other vessel appeared to be passing
safely and the next time he saw it the collision was imminent.
Meanwhile Crewe had picked up another boat on radar. It
was 'h mile ahead and '/a mile to starboard. He tried to change
the radar scale but, due to waves and rain, could not pick
anything up. The next thing he knows is that, when he looked
out his wheelhouse window, the other boat was 10 feet away.
He had seen no lights. He had not altered course. He had not
changed speed.
It must be concluded that there were protracted
periods of zero and near zero visibility for some
time prior to the collision.
Crewe acknowledged that the safe speed at
which to run is the speed at which the vessel can
be stopped within the limit of visibility. It is
obvious he was exceeding that speed. Fiddler was
emphatic under cross-examination in maintaining
that, in his opinion, Crewe had been navigating in
a proper seamanlike way prior to the collision. He
considered eight knots a moderate speed in zero
visibility; he says Joan W. II could, if necessary, be
stopped from that speed within three boat lengths.
Visibility was, at times at least, no more than one
boat length. Neither Crewe nor Fiddler accepted
the proposition that an extra lookout was needed
nor that the boat's whistle should have been sound
ed. I am inclined to agree that, in the circum
stances, an extra lookout would have been of little
practical advantage.
It is manifest that Crewe navigated in a manner
that met Fiddler's standards and it is, therefore,
not surprising that Fiddler did not find it necessary
to instruct or direct him in this respect after
observing him for nearly five weeks at sea. It may
very well be that the standards adopted by Crewe
and Fiddler are the standards accepted by a
majority of those engaged in the west coast fish
ery. Certainly the standard adopted by Wilson-
Haffenden was not significantly different. The dis
tinction on the question of liability was that All
Star was overtaken and Joan W. II did the
overtaking.
I accept the basic proposition that if a shipowner
engages a master whom he has good reason to
believe fully competent to perform his duties, in
the absence of other circumstances, the shipowner
cannot be found at fault for, or privy to, the acts or
omissions of that master while performing a duty
entirely within his sphere of responsibility. 6 Crewe,
in this instance, was performing a duty entirely
within his sphere of responsibility—navigating the
Joan W II. However, the standard by which the
shipowner must measure the master's competence,
in order reasonably to conclude that he is fully
competent, is not a subjective standard; it is that of
the ordinary, reasonable shipowner.
The Lady Gwendolen was one of three ships
owned by the Guinness brewing interests and
employed in the transport of their product across
the Irish Sea to ports in England. On November
10, 1961 she collided in thick fog with a vessel at
anchor. Liability was admitted and the action' was
for limitation of liability. The corporate plaintiff's
alter ego had been its head brewer until January,
1961 when he became its assistant managing
director. In the Court of Appeal, Sellers L.J. had
this to say: 8
6 The Empire Jamaica [1957] A.C. 386; [1956] 2 Lloyd's
Rep. 119.
7 The "Lady Gwendolen" [1965] P. 294; [1964] 2 Lloyd's
Rep. 99 (Q.B.); [1965] 1 Lloyd's Rep. 335 (C.A.).
8 [1965] P. 294 at page 333; [1965] 1 Lloyd's Rep. 335 at
page 339.
It is no excuse for the plaintiffs that their_main business was
that of brewers and that the ownership of three ships was
incidental to their business and solely for distributing their
product to Liverpool and Manchester.
In their capacity as shipowners they must be judged by the
standard of conduct of the ordinary reasonable shipowner in the
management and control of a vessel or of a fleet of vessels. A
primary concern of a shipowner must be safety of life at sea.
That involves a seaworthy ship, properly manned, but it also
requires safe navigation.
Mr. Justice Ritchie, for the Supreme Court of
Canada, in Stein v. The `Kathy K." 9 , stated with
respect to a shipowner's counterclaim seeking to
limit its liability:
The burden resting on the shipowners is a heavy one and is
not discharged by their showing that their acts were not "the
sole or next or chief cause" of the mishap.
He adopted the following statement of Viscount
Haldane: 10
They must show that they were themselves in no way at fault or
privy to what occurred.
There is no question of privity in this case.
However there is fault. I have no doubt that had
Fiddler's standard vis-Ã -vis the navigation of Joan
W. II been that of the ordinary reasonable ship-
owner rather than what it was, and what may well
be that of the ordinary independent west coast
fishing boat owner, he would have made a point of
ascertaining that Crewe knew what prudent navi
gating practice was, in various circumstances
likely to be encountered, and have issued orders as
to its observance. He would not simply have relied
on Crewe's experience as a fishing boat skipper
and his observations on two apparently uneventful
voyages. In particular, an ordinary reasonable
shipowner would have made sure that the master
he hired knew that a speed of eight knots in
conditions of zero or near zero visibility was negli
gent, if not reckless, and that he would act accord
ingly. He would have made sure that when, for any
reason, radar contact with nearby objects was lost,
the master would proceed at a speed that would
permit him to stop the vessel within the range of
9 (1976) 62 D.L.R. (3d) 1 at page 13.
10 Standard Oil Co. of New York v. Clan Line Steamers Ltd.
[1924] A.C. 100 at p. 113.
visibility whether or not he felt it expedient, in the
circumstances, to post an extra lookout. The ordi
nary reasonable shipowner would satisfy himself,
by examination, that his master would navigate
safely and, if not so satisfied, would issue appropri
ate orders. Fiddler did neither and his failure was
a fault that contributed to the casualty.
In their statement of defence, the defendants
plead that if the plaintiff were found entitled to
limit its liability the amount of the fund should be
$51,870 rather than the $25,020 asserted by the
plaintiff.
The Canada Shipping Act provides:
651. (1) For the purposes of sections 647 and 650
(b) the Governor in Council may by order from time to time
specify the amounts which shall be deemed to be equivalent
to 3,100 gold francs and 1,000 gold francs respectively.
The Governor in Council had not acted upon this
authority until October 1975 when the Gold Franc
Equivalent Order" was adopted. It specifies that
$83.40 shall be deemed to be the equivalent of
1,000 gold francs. The tonnage of Joan W. II,
being less than 300 tons, is deemed by section
651(1) (a) of the Act to be 300 tons and the
plaintiff's figure of $25,020 is 300 times $83.40.
The defendants argue that the Canadian dollar
equivalent of 1,000 gold francs ought to be estab
lished with reference to the date of the collision,
May 8, 1973, and that, since there was then no
specification by the Governor in Council in effect,
the market price of gold at that date ought to be
the basis of the determination. This is consistent
with the general principle of common law that
where damages are to be measured in a currency
other than the currency of the forum measuring
them, the appropriate date for conversion into the
domestic currency is the date when the damage
1 1 SOR/75-639, P.C. 1975-2579.
occurred. ' 2 Against this position, the plaintiff
argues that the Gold Franc Equivalent Order is to
be regarded as procedural, not legislative. It cites
two English cases: The "Abadesa" (No. 2) 13 and
The ` Mecca". 14 The pertinent circumstances in
each case are very similar. An order declaring the
sterling equivalent of 1,000 gold francs to be £23
13s. 27/32d. was made in 1958. Casualties involv
ing the ships occurred later, liability was estab
lished and actions brought by the shipowners to
limit their liability were pending when, on Nov.
18, 1967, the pound sterling was devalued. On
Nov. 24, 1967, reflecting the devaluation, an order
declaring the sterling equivalent to be £27 12s.
9 1 / 2 d. was made. When the limitation actions were
later disposed of by the Court, the equivalent in
effect at the date of determination rather than that
in effect at the date of the casualty was held to
apply.
Ordinarily, in view of my finding that the plain
tiff is not entitled to limit its liability, I should not
have found it necessary to mention this matter at
such length. It is purely a question of law and no
findings of fact by me should be necessary should
a higher court hold the plaintiff entitled to limit its
liability and have to decide the matter. However, I
think it desirable to record that there is no evi
dence whatever that the market price of gold at
the date of the collision was $91.50 per troy ounce.
The calculation leading to the $51,870 amount
hangs entirely on that price. Further, there is no
evidence that the market price of gold was the
accepted basis of such calculations in Canada
before the Gold Franc Equivalent Order was
made. Counsel for the defendants asserted in argu
ment that it was; counsel for the plaintiff denied in
argument that it was but, I repeat, there is no
evidence on the point.
12 Gatineau Power Co. v. Crown Life Insurance Co. [1945]
S.C.R. 655.
13 [1968] P. 656; [1968] 1 Lloyd's Rep. 493.
14 [1968] P. 665; [1968] 2 Lloyd's Rep. 17.
I now come to the question of costs. Mr. T. P.
Cameron appears on the record as counsel for all
of the defendants and his firm as their solicitors.
They were identically represented in action No.
T-1774-73. At the opening of this hearing he
introduced himself to me as representing only the
defendant Wilson-Haffenden and he introduced
Mr. S. H. Lipetz as counsel for the other defend
ants. I have searched the record in vain for some
indication of compliance by those other defendants
with Rule 300(5) in effecting a change of solicitor.
I might also add that I have searched in my own
mind, again vainly, for some reason why the plain
tiff should bear any cost for the separate represen
tation of the defendants.
All counsel requested that costs be awarded on
the basis of this having been a Class III action
throughout. That is appropriate.
The action is dismissed. The defendants are
entitled to one set of costs on the Class III scale.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.