If it remains doubtful whether the charterers were to have sole possession and control of the vessel during the voyage or were to be constituted owners pro hac vice, then the general owners must be deemed such for their rights and authority continue until displaced by some clear and definite transfer of them. The legal presumption is in favor of continuance of ownership and against any transfer of the ship to the charterer for the voyage, and is said to be so strong that, if the end sought to be effected by the charter party can conveniently be accomplished without the transfer of the vessel to the charterers, courts of justice are not inclined to regard the contract as a demise of the ship, although there may be express words of grant in the formal part of the instrument.
The master remains the agent of the owner under any contract falling short of a demise, and the owner is bound by all his acts and omissions within the scope of his authority as in the ordinary relation of carriage by sea. If the instrument amounts to a demise, the master is the charterer's agent, and not that of the owner. Bills of lading or other contracts of affreightment signed by the master bind the owner or the owner pro hac vice on the theory of the master's agency. This subject is discussed in the case of Freeman, 18 How. 182, quoted extensively in Chapter III, § 10, supra. Charter parties frequently contain a clause whereby the charterer agrees to indemnify the shipowner against any liability arising from the signature of bills of lading by the master. Probably this clause would be implied in a charter party if not expressed therein. This gives the owner of the ship a right of action over against the charterer on account of any liability to which the shipowner or ship may have been subjected at the hands of the shipper. Thus if the charter party contained covenants for the protection of the shipowner under certain circumstances and the bill of lading issued by the master did not contain these restrictions and the shipper recovered under the bill of lading against the ship or her owner, the latter in turn could recover against the charterer (Field Line v. South Atlantic Co., 201 Fed. 301).
9. Bills of Lading.—
The forms differ greatly in contents and legal effect but have the common features of an acknowledgment of the receipt of the goods; a description by which they may be identified; an agreement to carry to destination and deliver; the rate of freight and an exception of certain perils. In addition to these features it has been usual to include more or less elaborate provisions tending to a diminution or limitation of the ship's liability, sometimes extended to great length in small or illegible type, and the attempt to take advantage of these is sometimes described as "fine print and coarse work." These stipulations, in so far as they attempt to exempt the shipowner from the consequences of his own or his servants' negligence are not enforced in courts of the United States on grounds of public policy. They probably, however, have some value as deterrents of claims and litigation but should be studied in connection with the Harter Act (7 Comp. St. §§ 8029-8035). (See Chapter VIII, p. 119.) The common carrier by sea is subject to the same rules of extraordinary liability as the common carrier by land but this liability is controlled by the admiralty law of limited liability (Liabilities and Limitations, Chapter VIII, p. 112) and the provisions of the Harter Act. Like the land carrier, he may also enlarge or diminish his liability by special contract; such a contract must be clear and plain, based upon a meeting of minds, due consideration or mutuality, and conformity with law; it will not, however, protect against negligence on the part of the carrier. An example is found in the Guildhall, 58 Fed. 796, where a cargo was damaged in a collision occasioned by improper navigation. The owners of the ship based their defense on a provision in the bill of lading, which attempted to exempt from liability for "any neglect or defaults of the master, mariners, or others in the service of the owners, collision, perils of the seas," etc. It was held:
These stipulations are valid by the law of Rotterdam (the port of departure), and of England. But the obligation of the steamer, as a common carrier, was to deliver her cargo safely in this country, at the port of New York. As against the consignee and owner here, she can not commit torts on the high seas against his property with immunity, nor justify such torts, except by some valid contract, proved according to the law of the forum. By numerous decisions of the Supreme Court of the United States, stipulations like these, inserted by a common carrier in a bill of lading, are, first, void as against public policy; and secondly, they are not evidence of any contract to that effect on the part of the shipper and consignee; because unreasonable and not having the necessary element of voluntary assent.
See also Compania de Navigacion La Flecha v. Brauer, 168 U. S. 104:
Exceptions in a bill of lading or charter-party, inserted by the shipowner for his own benefit, are unquestionably to be construed most strongly against him.
In this case the cargo consisted of cattle, and the bill of lading contained this:
On deck at owner's risk; steamer not to be held accountable for accident to or mortality of the animals from whatever cause arising.... It is also mutually agreed that the carrier shall not be liable for loss or damage occasioned by ... accidents of navigation, of whatsoever kind, even when occasioned by the negligence, default or error in judgment of the pilot, master, mariners or other servants of the shipowner.
The vessel was improperly ballasted and rolled over on her beam ends. Some of the cattle were injured and in order to right the ship a number of them were thrown overboard, no discrimination being exercised between sound animals and those which had been injured. The court after laying down the general principles above quoted, further held: