MERCHANT'S AND OWNER'S risk is a term generally used in connection with contracts of carriage by sea, the term owner's risk beim,. usually confined to contracts of carriage by rail and deposit with warehousemen. It is introduced in these contracts in order to relieve the carrier or warehouseman from responsibility for the safety of goods carried or stored. Merchant's risk would appear in a charter-party in some such form a.s a stipulation that " the steamer shall he provided with a deck-load if required at full freight, but at merchant's risk." Such a stipulation does not, however, exclude the right of the charterers to general average contribution from the shipowners in respect of deck cargo shipped by the charterers, and necessarily jettisoned to save the ship and the rest of the cargo. 13ut if there were an improper jettison by the master and crew, this stipulation would relieve the shipowners from liability. "The stipulation is obviously in favour of the shipowners," said the Master of the Rolls in Burton v. English," for in order to earn a larger freight they may require a part of the cargo to be deck cargo, when it would be at the merchant's risk." A similar condition is also found incorporated in bills of lading. Owner's risk.—The reported cases on the meaning of this phrase are generally' instances where it occurs in the advice note from the raila ay com pany to the consignee, and where the company, having completed the actual carriage of' the goods, is simply holding them at the disposal of the consignee. In each case the precise iinport of the phrase must entirely depend upon the general wording of the advice note. A typical case of this class is that of Mitchell v. Lancashire and Yorkshire Railway Co., who sent to the plaintiff, who was the consignee, the following not as carriers, but as warehousemen, at owner's sole risk, and subject to the usual warehouse charges in addition to the charges now advised. When you send for the goods please to send this note.
For the Lancashire and Yorkshire Railway Company, J. Taylor, Agent.
Sixty bags fax, weight, freight, Sze. (carriage so much). Total to Pay (so much).
First note the care of the company to emphasise the fact that they are no longer carriers, but merely warehousemen. In view of their lighter responsibility in the latter character, it is always interesting for the business to watch the anxiety of railway companies to resolve themselves into warehousemen. It is undoubtedly their general practice, whenever even faintly possible, to meet claims made against them as carriers with the contention that the cause of the particular claim arose when they were warehousemen. It is a good practice, too, for claimants to generally regard that contention with suspicion, and only to recognise it after a careful con sideration of all the facts. But to return to the above case, wherein a railway company endeavoured to escape even the liability of warehousemen. Soon after the receipt of the advice note, Mitchell went to the station and -removed two tons of the flax, but left the rest at the station for more than two months. There were no warehouses at the station, and the flax remained on open ground insufficiently covered, and became damaged by wet. In the above action for damages the company contended that they
charged nothing for warehousing, were not even liable as warehousemen, and held the flax at " the owner's sole risk "; but they admitted that if they were bound to take reasonable care of the flax, they had not done so. It was held, however, that, treating the advice note acquiesced in by Mitchell as a contract, the terms of it, taken altogether, did not exempt the company from liability for negligence to the extent that they would be liable as ware housemen or bailees for hire; and that they were therefore liable for the damage. The judgment included some very valuable remarks, which should be carefully studied. "The defendants," said Mr. :Justice Field, " were originally tinder a contract to carry these goods to New church station, and I take it that their duty was to do that which they did ; and on the arrival of the goods at the station they gave the consignees notice of it, and then it became the consignees duty to send for them within a reasonable time. During that reasonable time it might be a question whether the company held the goods as carriers or ‘varehousemen. In order to prevent all doubt the company adopted the usual course, that is, they gave notice to the consignees : Your goods have come; you must send for them and fetch them away as soon as possible.' And then they go on to say, 'If you do not do that, we give you notice that we will no longer be liable as carriers, but we will hold them as warehousemen.' Now, if the notice had stopped there, of course there would have been no question at all about it, because, even if the defendants were not bound to hold the goods, they did, in point of fact, hold and retain them on the terms of their own notice; therefore the only question, is as to what is the true construction of their own advice note. Now, undoubtedly, the words 'at owner's sole risk' du create a difficulty of construction. I must confess, for myself, that I do not at present see what element that expression provides for looking at the exact nature and character of the warehousemen's liability ; but then I am bound to look at the whole contract, and read it altogether; and I find these words, 'at owner's sole risk,' follow affirmative and positive words describing what the obligation is under which they come, and in what character they held the goods, viz., as warehousemen. . . . They became liable as warehousemen, and in that respect they are liable." And Mr. Justice Blackburn, in the same case, said that he did not think there had been any ca.se decided to the extent that, because the owner of goods was idle and blamable for leaving them in the carriers' hands, therefore they, as trustees, held them under no responsibility whatever. " I think in this case the railway company in holding these goods could have charged warehouse rent, and that being so, I think there can be no doubt that prima' facie there was a liability in them as bailees for reward. The liability of an ordinary bailee is to take ordinary and reasonable care."