Bow McLachlan & Co. v. The Ship "Camosun"

Bow McLachlan & Co. v. The Ship "Camosun"

The Exchequer Court of Canada, exercising admiralty jurisdiction, has power to entertain an equitable defence in abatement to an action in rem to enforce a ship mortgage; the owners may set off against the mortgage only the diminution in value of the ship at delivery caused by defective construction, and may not claim consequential damages in that proceeding. The amendment (paragraph 7) thus disclosed a good defence pro tanto and was properly allowed.

Citation
(1908) 40 SCR 418
Parties
Plaintiff/appellant: Bow McLachlan & Co.; Defendant/respondent: The Ship "Camosun" (Union Steamship Company of British Columbia, owners)
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
16 June 1908
Procedural Posture
Admiralty Mortgage Action in Rem / Appeal to Supreme Court of Canada From Exchequer Court of Canada (admiralty)
Outcome
Appeal dismissed; judgment of Exchequer Court affirmed
Legal Topics
Mortgage Enforcement, Action in Rem, Set Off and Abatement, Jurisdiction of Colonial/exchequer Admiralty Courts, Pleading Amendment and Counterclaim
Source Language
English
Admiralty Law Maritime Mortgage Contract Law Civil Procedure Mortgage Enforcement Action in Rem Set Off and Abatement Jurisdiction of Colonial/exchequer Admiralty Courts +1 more

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Parties

Bow McLachlan & Co.

Plaintiff/appellant

The Ship "Camosun" (Union Steamship Company of British Columbia, owners)

Defendant/respondent

Procedural Posture

Admiralty Mortgage Action in Rem / Appeal to Supreme Court of Canada From Exchequer Court of Canada (admiralty)

Legal Issues

  1. 1 Whether Exchequer Court in admiralty has jurisdiction to entertain a defence in abatement to a mortgage action in rem
  2. 2 Whether an action in rem to enforce a mortgage excludes equitable or personal defences and set-offs by the ship owners
  3. 3 Whether claims for defects in construction must be pursued in a separate action or may be set off pro tanto against the mortgage claim

Ratio Decidendi

The Exchequer Court of Canada, exercising admiralty jurisdiction, has power to entertain an equitable defence in abatement to an action in rem to enforce a ship mortgage; the owners may set off against the mortgage only the diminution in value of the ship at delivery caused by defective construction, and may not claim consequential damages in that proceeding. The amendment (paragraph 7) thus disclosed a good defence pro tanto and was properly allowed.

Court Disposition

Appeal dismissed; judgment of Exchequer Court affirmed

Orders

  • Order of Exchequer Court affirmed (paragraph 7 of amended defence allowed as a good defence pro tanto)
  • Appeal dismissed with costs