Various anomalies, &c., then in existence.
In fact, the Navigation Laws, as they stood in 1847, were full of anomalies, and were altogether unsuited for the state of things at which nations had now arrived. The 7th clause of the Act 7 & 8 Vict., cap. 88, directed, that “no goods shall be exported from the United Kingdom to any British possession in Asia, Africa, or America, nor to the islands of Guernsey, Jersey, Alderney, or Sark, except in British ships.” Goods, the produce of colonies in Asia, Africa, and America, could, however, be brought in vessels of any flag to the Channel Islands, but, from these, they must be brought in a British ship; and there was also the further anomaly, as we have shown, of United States vessels being allowed to clear out with produce and manufactures of the United Kingdom to the East Indies.
Curious effects of the Registry Laws
as regarded individuals or corporate bodies.
Power was then, also, granted to the Queen in Council to allow any foreign nation to trade with British colonies; and this privilege was granted to a considerable number. To some it was accorded without restriction; to others, such as France and Spain, who were rivals, restricted powers were given; while the privilege, granted to the United States of trading with British colonies, was afterwards accorded to Columbia, Rio de la Plata (including the States since formed), Mexico, Hayti, Chili, France to a limited extent, and the Spanish Colonies; and, further, all countries within what were called the limits of the East India Company’s Charter, that is, all foreign countries west of Cape Horn, and east of the Cape of Good Hope, had liberty to trade with the British possessions within the same limits. (Order in Council, 16 July, 1827.) French ships under this order were, however, only allowed to import into British colonies such goods, the produce of France, as were enumerated in the table annexed to the order (Orders, 1 June, 1826; 16 Dec., 1826), this order not including wine, the staple of France, a distinction deliberately adopted and confirmed. But, besides these perplexing anomalies, and others to which I shall presently call attention, the execution of the Navigation Law, as it was in 1847, was full of difficulties arising from the Registry Law, and the naturalisation of goods brought to Europe, &c. With respect to the Registry Law, there was a clause (the 13th) of the Navigation Act which stated “that no ship shall be admitted to be a British ship unless duly registered;” and that this might be properly done, the owner had to declare “that no foreigner has any right, share, or interest in the ship.” The following remarkable case will show how completely the spirit of this old law was neutralised in the case of Joint-Stock Companies.
Ship Equador.
Decision of Queen’s Bench, December 1846.
An application was made to the Collector at Liverpool for the registry of a ship called the Equador, belonging to the Pacific Steam Navigation Company. In the first instance, the Company required registry as a Joint-Stock Company, and three members, who had been duly elected and appointed trustees, attended at the Custom-House, Liverpool, to subscribe the requisite declaration of registry, in conformity with the provisions of the 13th and 36th sections of the Act 8 & 9 Vict., cap. 89 (the Registry Act). By the 13th section, the trustees of a Joint-Stock Company, in common with all other owners of British ships (excepting those owned by corporate bodies), were required to declare “that no foreigner, directly or indirectly, hath any share or part interest in the said ship or vessel.” The trustees in question stated that they could not make that declaration, because, in point of fact, foreigners did hold shares in that ship, and also in the other vessels belonging to the said Company; and they requested the Collector and Controller at Liverpool to expunge from the declaration the words above recited; but those officers, having no legal authority to comply with this request, refused to make this alteration. The Company then addressed the Board of Customs, requesting that they would direct their officers at Liverpool to expunge from the declaration the words above recited; but the Board, acting under advice, refused compliance with the request. The Company’s secretary then demanded registry on behalf of the Company as a “corporate body,” and claimed to make the declaration, contained in the 13th section of the Act aforesaid, which applies to corporate bodies. That declaration does not, like the other declaration, exclude foreign interest; and if, in the first instance, the Company had claimed registry as a corporate body, the probability is, that it would have been granted as a matter of course, without raising the question of foreign interest. But the Collector and Controller at Liverpool, with a full knowledge that foreigners were proprietors of the vessel, and adverting to the 13th and other sections of the Registry Act, refused registry; and the Commissioners of Customs, acting upon their solicitor’s opinion, supported the Liverpool officers in their refusal to grant the registry. The Company then moved for a mandamus in the Court of Queen’s Bench; and, after the usual proceedings in such cases, it was decided by the Court that as the Company applied for registration in its corporate capacity, the Court could not take notice of its constituent members, whether they were actually foreigners or not; or, in other words, that an English Incorporated Company was a British subject for the purposes of the Registry Act.
Further details: owner to reside in the United Kingdom.
The result of this remarkable decision was that foreigners, when incorporated, could own a ship, but not individually. In an extreme case, a ship might, ultimately, become the sole property of foreigners exclusively, and yet be entitled to be registered as a British ship, as a corporate body remains permanently. So that the law created the curious anomaly that a foreigner could not have a share in a British vessel, but might be the owner of all the shares of a corporate body which owned, for instance, the Great Eastern. Another difficulty arose with reference to the residence in or out of England of the owner of a ship. The Free-trade party contended that if a foreigner were disposed to come here and build a ship, there was no disadvantage either to British shipbuilders or British shipowners, or British sailors, especially as he could hold all the shares of a ship. On the other hand, it was contended that this was an extreme case, not likely often to occur, and the principle, if acted upon, of allowing individual ownership, might give considerable power to foreigners to the prejudice of British subjects; in fact, that the violation of this principle went to the very basis of the Navigation Law, which it would destroy. To such a point was real British ownership carried out, that, as the Act required owners of British ships to reside in the United Kingdom, the owner of a British registered ship, if he resided at Paris,[57] would lose his privileges as such.