The Weekly Law Reports, January 29; 1982

119
1 W.L.R.

A , ' ' ' '

[COURT OF APPEAL]

* ACTIS CO. LTD. v. SANKO STEAMSHIP CO. LTD.

1981 July 22, 23, 24; Lord Denning M.R., Shaw

Oct. 15 and Griffiths L.JJ.
B
Shipping—Charterparty—Time charter—Hire—Vessel exceeding
permitted draught—Refusal to allow vessel to pass through
Panama Canal—Part of cargo transhipped—Whether vessel
off hire—Whether " seaworthy "—Whether owners able to
. recover transhipment costs — Whether entitled to hire for
period of delay—Carriage of Goods by Sea Act 1924 (14 & 15
r Geo. 5, c. 22), Sch., arts. Ill, r. 1 (a), IV, r. 2 (c) "
Ships' Names—Aquacharm
. By a charterparty which incorporated the Hague Rules arid
provided for arbitration in London, the owners of the
Aquacharm let her on a time charter to carry coal from
Baltimore to Tokyo. The charterers, who under the charter
were to load and discharge the cargo under the supervision of
the master, ordered her to load up to the draught " permissible
D by. the Panama Canal Company." The master took on 43,000
tons of coal which was too much for safety through the
Panama Canal. When the Aquacharm reached the entrance to
the canal she was refused permission to go through because
she exceeded the permitted draught. 636 tons of coal were dis-
charged into another vessel, which followed the Aquacharm
through the canal, and were then reloaded before-the Aqua-
charm completed her voyage. The transhipment operations cost
L $71,470 and caused a delay of almost nine days, the hire for
which period came to $86,345. The consequent dispute between
the parties went to arbitration. On a case stated by the umpire,
Lloyd J. held in the owners' favour that during the delay of
nearly nine days the Aquacharm was not off hire within the
meaning of the words " loss of time from . . . any . . . cause
preventing the full working of the vessel " in the off hire clause
P of the charterparty and that she was " seaworthy " within the
** meaning of article III, r. 1 (a) of the Hague Rules, 1 but that
the owners were not entitled to recover the costs of tranship-
ment from the charterers.
On appeal, by the charterers and cross-appeal by the
owners: —
Held, dismissing the appeal, (1) that the lightening of her
cargo in her passage through the Panama Canal did not pre-
Q vent the vessel remaining a " full working " ship and accord-
ingly she was still on hire during the period of nearly nine
days when she was delayed (post, pp. 122C-E, 125B, 126E).
Court Line Ltd. v. Dant and Russell Inc. (1939) 44
Com.Cas. 345 considered.
(2) That " seaworthy " in the Hague Rules bore its ordinary
meaning that the vessel with her master and crew was fit both
to encounter the perils of the voyage and to carry her cargo
JJ safely on that voyage; and that the vessel had been " sea-
worthy " within the meaning of article III, r. 1 (a) throughout
• the voyage (post, pp. 122H, 125r>-F, 126E).
Ciampa v. British Steam Navigation Co. Ltd. [1915] 2 K.B.
774 distinguished.
(3) Dismissing the cross-appeal, that an indemnity did not
lie in respect of loss or expenditure incurred in consequence
\ Carriage of Goods by Sea Act 1924, Sch., art. Ill, r. 1 (a): see post, p. 122G,
Art. IV, r. 2 (a): see post, p. 122G.
 :The Weekly Law Reports, January 29, 1982
120
Actis Co. v. Sanko Steamship Co. (C.A.) [1982]
of a plaintiff's own fault or that of his servant unless covered \
expressly or by necessary implication and that accordingly,
since the costs of the transhipments of the cargo for the
passage through the canal were incurred by the fault of the
master in overloading the Aquacharm, the owners could not
recover those costs even though (per Lord Denning M.R. and
Shaw L.J.) the owners were protected under article IV, r. 2 (a)
of the Hague Rules against an action for the negligence of
the master (post, pp. 123D-G, 126C-D, E, 127A-B). B
Canada Steamship Lines Ltd. v. The King [1952] A.C. 192,
P.C. applied.
Decision of Lloyd J. [1980] 2 Lloyd's Rep. 237 affirmed.
The following cases are referred to in the judgments:
AMF International Ltd. v. Magnet Bowling Ltd. [1968] 1 W.L.R. 1028;
[1968] 2 All E.R. 789. c
Canada Steamship Lines Ltd. v. The King [1952] A.C. 192; [1952] 1 All
E.R. 305, P.C.
Ciampa v. British India Steam Navigation Co. Ltd. [1915] 2 K.B. 774.
Court Line Ltd. v. Dant and Russell Inc. (1939) 44 Com.Cas. 345.
Elder, Dempster and Co. Ltd. v. Paterson, Zochonis & Co. Ltd. [1924]
A.C. 522, H.L.(E.).
Madeleine, The [1967] 2 Lloyd's Rep. 224. D
Mareva Navigation Co. Ltd. v. Canada Armadora S.A. [1977] 1 Lloyd's
Rep. 368.
Sidermar S.p.A. v. Apollo Corporation [1978] 1 Lloyd's Rep. 200..
Walters v. Whessoe Ltd. and Shell Refining Co. Ltd. (unreported),
November 18, 1960; Court of Appeal (Civil Division) Transcript No.
343 of 1960, C.A.
-E
The following additional cases were cited in argument:
Assicurazioni General v. S.S. Bessie Morris Co. Ltd. [1892] 2 Q.B. 652,
C.A.
Compagnie Algerienne de Meunerie v. Katana Societa di Navigatione
Marittima, S.p.A. [1960] 2 Q.B. 115; [1960] 2 W.L.R. 719; [1960]
2 All E.R. 55, C.A.
General Steam-Navigation Co. v. Slipper (1862) 11 C.B.N.S. 493.
Hang Fung Shipping & Trading Co. Ltd. v. Mullion & Co. Ltd. [1966] 1
Lloyd's Rep. 511.
Harmony Shipping Co. S.A. v. Saudi-Europe Line Ltd. [1981] 1 Lloyd's
Rep. 377, C.A.
Svensden v. Wallace Brothers (1884) 13 Q.B.D. 69, C.A.
G
APPEAL from Lloyd J.
On a case stated by the umpire, Mr. C. S. Staughton Q.C., in an
arbitration between the owners, Actis Co. Ltd., and the charterers, Sanko
Steamship Co. Ltd., the following agreed questions had been submitted
(paragraph 14 of the award): (1) (a) Was the vessel (M.V. Aquacharm)
off hire between 14.50 on November 14, 1974, and 09.05 on November 22, H
1974, and between 16.00 on November 23, 1974, and 21.30 on November
24? (b) If the vessel was off hire were the owners entitled to an indemnity
by way of damages or otherwise in the amount of hire which would other-
wise have been earned? (2) Are the owners liable for damages for breach
of contract in the amount of hire which accrued in respect of those
periods? (3) Are the owners entitled to any indemnity in respect of any
(and if so which) of the expenses reasonably incurred in connection with
 The Weekly Law Reports, January 29, 1982
121
1 W.L.R. Actis Co. v. Sanko Steamship Co. (C.A.)
A. the refusal of the Panama Canal Company to permit transit of the vessel
without lightening?
Lloyd J. held [1980] 2 Lloyd's Rep. 237, 240, 241, 245, on March
14, 1980, that the answers to the three questions were: (1) (a) No, so
that question 1 (b) did not arise; (2) No; (3) No.
The charterers appealed on the grounds, inter alia, that the judge erred
_ in law in holding that on the facts the vessel was seaworthy on sailing
from Baltimore and in holding that the charterers had before the umpire
the burden of proving (a) that the master's failure to make allowance in
his loading calculations for the actual density of water at the Gatun Lake
in the Panama Canal was negligent; (b) that but for the breaches of con-
tract disclosed by the facts found the vessel would not have been refused
transit of the Panama Canal and that the judge ought to have held that
C the charterers had suffered loss and damage by the owners' breaches of
contract.
The owners cross-appealed on the grounds, inter alia, that the judge
erred in law in holding that the expenses involved in the transhipment of
the cargo to transit the Panama Canal were not recoverable under the
charterparty and in holding that those expenses were not recoverable under
D an implied indemnity for the direct consequences of complying with the
charterers' orders.
The facts are stated in the judgments of Lord Denning M.R.

Nicholas Phillips Q.C. and Jonathan Sumption for the charterers.

Stewart Boyd Q.C. for the owners.
„ Cur. adv. vult.
E
October 15. The following judgments were read.

LORD DENNING M.R. In 1974 the owners of the Aquacharm let her to
Japanese charterers on a time charter. She was to carry a cargo of coal on
a trip from Baltimore to Tokyo. This necessitated her passing through the
P Panama Canal. The charterers ordered her to load up to the draught
" permissible by the Panama Canal Company of 39' 6" TFW." TFW
stands for tropical fresh water.
The master took on board 43,000 tons of coal. That was too much
for safety through the canal. When a vessel is in transit through the
Panama Canal she has to sail through a lake called Gatun Lake. It is a
_, fresh water lake. Now, when a vessel passes from salt water into fresh
water, there is a tendency for the bow to go down relative to the stern.
The master knew this, but he did not allow for it when he loaded at
Baltimore. He was at fault in loading the vessel. She was already down by
the head when she reached Cristobal, at the entrance to the canal. This
gave rise to a risk that, when her.bow went down on entering the Gatun
Lake, she might touch bottom. He ought to have loaded less cargo so as
H to allow for the tendency of the bow to go down.
When the vessel arrived at the entrance to the canal, the Panama Canal
Company refused to allow her to go through. They said that she exceeded
the permitted draught as prescribed by their regulations. To get over the
difficulty, it was decided to discharge 636 ton's of coal into another vessel
called Mini Lux. She followed the Aquacharm through the canal. The 636
tons were then reloaded at the other end.
This delay held up the vessel for eight days 23 hours and 45 minutes.
 The'Weekly Law Reports,' January 29, 1982
122
Lord Denning M.R. Actis Co. v. Sanko Steamship Co. (C.A.) [1982]
Nine days all but a quarter of an hour. The hire for that period came to A
$86,344.89. The charterers refused to pay. They invoke the " off hire "
clause to excuse them from paying.
The total cost of transhipment came to $71,470. The owners claim to
recover this cost from the charterers under an express or implied term of
the charter.
B
1. Off hire or not?
The charterparty was on the New York Produce Exchange form, but
with arbitration in London instead of New York. The " off hire " clause
15 said:
". . . in the event of the loss of time . . . by any other cause prevent-
ing the full working of the vessel, the payment of hire shall cease for c
the time thereby lost...."
The umpire, Mr. C. S. Staughton Q.C. and the commercial judge,
Lloyd X, [1980] 2 Lloyd's Rep. 237 held that the vessel was still on hire
for those nearly nine days. She was not off hire. I agree with them. In
seeing whether clause 15 applies, we are not to inquire by whose fault it
was that the vessel was delayed. We are to inquire first whether the " full T-J
working of the vessel" has been prevented. Only if it has, do we consider
the "cause." I do not think the lightening of cargo does "prevent the
full working of the vessel." Often enough cargo has to be unloaded into
a lighter—for one reason or another—to get her off a sandbank—or into
a basin. The vessel is still working fully, but she is delayed by the need to
unload part of the cargo. It is rather like Court Line Ltd. v. Dant and
Russell Inc. (1939) 44 Com.Cas. 345. The vessel was still working fully, E
but she was delayed by the boom across the Yangtse River. This vessel
was, therefore, still on hire for nearly nine days.

2. The master's fault

Seeing that the cause of all the trouble was the master's fault in over-
loading the vessel, the question is whether the charterers can recover p
damages from the owners. Such damages being the hire they have to
pay to the owners for the nearly nine days.
The answer depends on whether the vessel was seaworthy or not when
she left Baltimore for her trip through the Panama Canal to Japan. If she
was unseaworthy, the shipowners would be liable. They would not be able
to prove that they exercised due diligence. The shipowners would be
liable under articles III, r. 1 (a) (requiring the carrier to exercise due
diligence to " (a) make the ship seaworthy ") and IV of the Hague Rules
(see Schedule to the Carriage of Goods by Sea Act 1924). If she was
seaworthy, the shipowners would not be liable. They would be exempted
from liability by reason of article IV, r. 2 (a), because the loss arose from
the " neglect... of the master " in the " management" of the ship. *
Both the umpire and the judge found that this vessel was seaworthy. H
I agree with them. I think the word " seaworthy " in the Hague Rules is
used in its ordinary meaning, and not in any extended or unnatural mean-
ing. It means that the vessel—with her master and crew—is herself fit to
encounter the perils of the' voyage and also that she is fit to carry the
cargo safely on that voyage: see Scrutton on Charterparties, 18th ed. (1974),
p. 83. This vessel was so fit. It may be that she had to be lightened to
pass through the Panama Canal, but that did not make her unfit. It is
 The Weekly Law Reports, January 29* 1982
123
1 W.L.R. Actis Co. y.Sanko Steamship Co. (C.A.) Lord Denning M.R.
y\ quite unlike Ciampa v. British India Steam Navigation Co. Ltd. [1915]
2 K.B. 774. The vessel there was unfit to carry the cargo safely because
she had to be fumigated. So also in The Madeleine [1967] 2 Lloyd's Rep.
224. As the judge said, there is ho case in which a ship has been held to be
unseaworthy merely because she has to lighten in order to get into port.
So also if she has to lighten in order to get through a canal.
I hold, therefore, that the charterers cannot recover damages for having
" to pay the hire.

3. Cost of transhipment
The owners say that they were put to all the cost of transhipping the
636 tons of coal into a lighter and back again. They claim to recover that
cost under clause 8 of the charter, which says:
^ " The captain (although appointed by the owners) shall be under the
orders and direction of the charterers as regards employment and
agency, and charterers are to load, stow and trim, tally and discharge
the cargo at their expense under the supervision of the captain...."
Alternatively, the owners claim the cost under an implied indemnity—
implied, they say, in a time charter trip—that they should be indemnified
against the costs properly incurred by them as a result of complying with
the directions to take the cargo on that trip.
This is a point on which the umpire and the judge differed. The
umpire thought that the owners were entitled to be indemnified. The
judge thought not: [1980] 2 Lloyd's Rep. 237, 244-245. To my mind this
point is to be solved by remembering that the master was at fault in
E overloading the vessel—for the specified trip. He put so much cargo into
the vessel that she had to be lightened in order to pass through the
Panama Canal. The case comes, therefore, within the long line of auth-
orities which show that indemnity will not lie in respect of loss or
expenditure which is the consequence of the plaintiff's own fault or that
of his servant unless covered expressly or by necessary implication: see
F Canada Steamship Lines Ltd. v. The King [1952] A.C. 192 and Walters v.
Whessoe Ltd. and Shell Refining Co. Ltd. (unreported), November 18,
1960; Court of Appeal (Civil Division) Transcript No. 343 of 1960,
but fully set out by Mocatta J. in AMF International Ltd. v. Magnet
Bowling Ltd. [1968] 1 W.L.R. 1028, 1056-1058. I do not think that this
principle is affected at all by the fact that the shipowners are protected
by article IV, r. 2 (a) of the Hague Rules against an action for the
G negligence of the master. The simple point is that the indemnity, on its
true construction, does not cover the cost of transhipment when it has
been brought about by the fault of the master. On this point, therefore,
I agree with the judge and not the umpire.

Conclusion
H I think that the decision of the judge [1980] 2 Lloyd's Rep. 237 was
correct on all the points. The appeal should be dismissed, and also the
cross-appeal.
Shaw L.J. cannot be here this morning. I have his judgment with me,
but I will ask Griffiths L J . to give his judgment first.

GRIFFITHS L.J. The Aquacharm was hired on a time charter to carry

a cargo of coal from Baltimore to Japan. This voyage entailed passage
 The Weekly Law Reports, January 29, 1982
124
Griffiths L.J. Actis Co. v. Sanko Steamship Co. (C.A.) [1982]
through the Panama Canal. When the Aquacharm arrived at the Panama A
Canal, the canal authorities refused to allow her to enter the canal until
she had lightened her cargo as they feared that her draught was too deep
for safe passage through the canal. The Aquacharm, therefore, off-loaded
a part of her cargo into a lighter; she was then permitted to pass through
the canal followed by the lighter. The coal was reloaded into the
Aquacharm at the other end of the canal. This operation resulted in a B
delay of approximately nine days and the additional costs involved in the
transhipment of a part of the cargo. Should these additional expenses fall
upon the owners or the charterers?

The off hire clause

The charterers submit that they are not liable to pay for the period of C
delay as the Aquacharm was off hire during that time. Clause 15 of the
charterparty provides:
" That in the event of the loss of time from deficiency of men, stores,
fire, breakdown or damage to hull, machinery or equipment, ground-
ing, detention by average accidents to ship or cargo, drydocking for
the purposes of examination or painting bottom or by any other cause D
preventing the full working of the vessel, the payment of hire shall
cease for the time thereby lost...."
The charterers rely upon the words, " any other cause preventing the
full working of the vessel." Mr. Phillips, founding himself upon a passage
in the judgment of Kerr J. in Mareva Navigation Co. Ltd. v. Canaria
Armadora S.A. [1977] 1 Lloyd's Rep. 368 submits that the excess draught E
caused by the amount of cargo she was carrying prevented the full
working of the Aquacharm because she was unable in that condition to
perform the service required of her, namely to pass through the canal. I
do not read Kerr J.'s judgment as supporting the proposition that a ship
which is sound in herself is prevented from " full working " because it
has loaded too much cargo to pass through a particular waterway, or to p
enter a particular harbour.
Kerr J. was not considering a situation such as has arisen in this case,
and the whole emphasis of his judgment directs one to consider the
efficiency of the ship herself in deciding whether or not it is capable of
"full working": see in particular the passage where he said [1977]
1 Lloyd's Rep. 368,382:
CJ
" But if, for instance, the cargo is damaged as the result of an
accident, but the vessel's ability to work fully is not thereby prevented
or impaired, because the vessel in herself remains fully efficient in all
respects, then I do not think the charterers bring themselves within
the clause."
The Aquacharm remained at all times in herself fully efficient in all H
respects. She could not pass through the canal because the canal authori-
ties decided she was carrying too much cargo, but that decision in no way
reflected upon the Aquacharm's efficiency as a ship.
By contrast, in Sidermar S.p.A. v. Apollo Corporation [1978] 1 Lloyd's
Rep. 200, a ship was held up by the port health authorities because two of
the crew had been taken to hospital with suspected typhus, and the health
authority insisted that the ship be disinfected before they would issue a
 The Weekly Law Reports, January 29, 1982
125
1 W.L.R. Actis Co. v. Sanko Steamship Co. (C.A.) Griffiths L.J.
A free pratique. Mocatta J. held that the vessel was off hire during that
period of delay. A ship suspected of carrying typhus is prevented from
working fully until it is cleared, for no responsible person would use it in
such a condition. The incapacity of the ship to work in such a case is
directly attributable to the suspected condition of the ship itself, and in
my view is clearly distinguishable from the present case.
_ Although obviously not on all fours, the present case is nearer to
Court Line Ltd. v. Dant and Russell Inc., 44 Com.Cas. 345 when the
ship although sound in herself was delayed by a boom across the Yangtse
River, and it was held that it remained on hire.
As the Aquacharm remained at all times an efficient ship, she was
capable of " full working " within the meaning of the off hire clause and
the charterers do not succeed under this head.
C
Was she seaworthy?
If the charterers cannot avail themselves of the off hire clause, they
claim to recover the cost of the nine days delay as damages on the ground
that the owners had failed at the beginning of the voyage to exercise due
diligence to make the Aquacharm seaworthy pursuant to article III,
D r. 1 (a) of the Hague Rules which applied to this charterparty.
Mr. Phillips submits that because, after loading, the draught of the
Aquacharm was too great to permit her passage through the Panama Canal
she was, therefore, unseaworthy because she could not safely carry her
cargo on the contemplated voyage.
As I understand the authorities, there are two aspects of seaworthiness.
p The first requires that the ship, her crew and her equipment shall be in all
respects sound and able to encounter and withstand the ordinary perils of
the sea during the contemplated voyage. The second requires that the ship
shall be suitable to carry the contract cargo: see in particular Elder,
Dempster and Co. Ltd. v. Paterson, Zochonis & Co. Ltd. [1924] A.C. 522.
The Aquacharm at all times fulfilled the first requirement of sea-
worthiness; there is no suggestion that her draught was such as to put her
F at risk in a heavy sea or to render her in any way unsafe to sail in. The
Aquacharm also fulfilled the second requirement; she was a suitable vessel
to carry a cargo of coal. The reason why she could not enter the Panama
Canal was not because she was unsuitable to carry a cargo of coal but
because the master had loaded the coal so that the Aquacharm was down
by the head when she arrived at the canal, and possibly had loaded too
Q much coal. The Aquacharm was delayed because of bad stowage; not
because she was unseaworthy. Therefore, the alternative way in which
the charterers seek to escape liability for the hire during the period of
delay also fails.

The cost of transhipment

jj These extra costs were paid for by the owners who seek to recover
them pursuant to clause 8 of the charterparty, which provides:
" That the captain shall prosecute his voyages with the utmost des-
patch, and shall render all customary assistance with ship's crew and
boats. The captain (although appointed by the owners) shall be under
the orders and directions of the charterers as regards employment and
agency; and charterers are to load, stow and trim the cargo at their
expense under the supervision of the captain, who is to sign bills of
 :The Weekly. Law Reports, January 29, 1982
126
Griffiths L.J. Actis Co. v. Sanko Steamship Co. (C.A.) [1982]
lading for cargo as presented, in conformity with mates or tally clerk's A
receipts, without prejudice to this charterparty."
I agree with the judge that as a matter of construction this clause
applies only to loading and discharging at loading and discharging ports!
This is, I think, apparent from the juxtaposition within the clause of the
charterers' duty to load and discharge and the master's duty to sign bills
of lading which is a duty clearly associated with loading at a loading port. B
The clause has no application to the unexpected partial transhipment of
the cargo that occurred during this voyage.
There remains the owners' alternative submission that they are entitled
to recover the expenses of transhipment under an implied indemnity for
the direct consequences of complying with the charterers' orders.
The short answer to this submission is that the owners have failed to C
show that the transhipment expenses were incurred as a direct consequence
of complying with the charterers' orders. The master did not stow the
coal in compliance with the charterer's orders; had he done so, it may well
be that the canal authorities would have allowed the Aquacharm passage
through the canal, although this is a matter of doubt because of the parti-
cular calculations adopted by the canal authority. What is certain is that
the master's failure to ensure that the cargo was properly stowed made it D
inevitable that the transhipment expenses would be incurred. The burden
is on the owners claiming the indemnity to establish that the charterers'
orders caused the loss—this they have failed to do and they are not,
therefore, entitled to be indemnified against the expenses of the tran-
shipment.
I too would dismiss the appeal. E

SHAW LJ. (read by Lord Denning M.R.). I entirely agree with the
judgment of Lord Denning M.R. and with that of Lloyd J. I would only
enter my own caveat against any artificial extension of the concept of
" seaworthiness" where that term is used in relation to the carriage of
goods by sea.
It was submitted for the appellant charterers that inasmuch as the
Aquacharm left Baltimore carrying a cargo of 43,000 tons which caused
her to draw more than was permissible for a voyage which would take
her through the Panama Canal, ergo she was not seaworthy in relation to
the passage through the canal. This involved either (i) the proposition that
a vessel which was seaworthy at one stage of a voyage and underwent no
change of condition might nonetheless be regarded as unseaworthy at
another stage, or (ii) the alternative contention that a ship is to be
regarded as unseaworthy throughout a contracted voyage if, on leaving
the port of loading, her condition is such that her progress will be
impeded at some stage of that voyage by some event to be anticipated
albeit she is at all times sound and trim.
While these submissions appear superficially tenable, they cannot H
survive critical examination. " Seaworthiness " connotes an inherent quality
with which the unit comprising vessel and cargo is invested. So long as that
unit maintains a constant character, that quality remains inherent in it.
External factors cannot influence or affect the innate attribute of sea-
worthiness.
Counsel for the charterers was, therefore, driven to contend that, hav-
ing regard to what were the known incidents of a voyage through the
 The Weekly Law Reports, January 29, 1982
127
1 WX.R. Actis Co. v. Sanko Steamship Co. (C.A.) Shaw LJ.
A Panama Canal, involving the passage of Gatun Lake, the Aquacharm as
loaded, and drawing what she did, was unseaworthy when she departed
from Baltimore. This proposition which equates the seaworthiness of a
vessel with her ability to perform the contractual voyage without im-
pediment is not consonant with any recognised principle in relation to
charterparties.
I would dismiss the appeal for the reasons stated in the judgment of
Lord Denning M.R.

Appeal and cross-appeal dismissed.

Charterers to pay two-thirds of the
costs and owners one-third.
Leave to appeal.
C
Solicitors: Ince & Co.; Holman, Fenwick & Willan.

A. H. B.

[QUEEN'S BENCH DIVISION, BIRMINGHAM]

E
* WEST MERCIA CONSTABULARY v. WAGENER AND OTHERS

[1981 W. No. 454]

1981 April 14 Forbes J.

Injunction—Detention or preservation of property—Proceeds of

r " crime—Proceeds paid into bank account—Police applying for
injunction to freeze bank account—Whether jurisdiction to
grant injunction to preserve proceeds of criminal activities—
R.S.C., Ord. 29, r. 2 (1) l
The first defendant was charged under section 20 (2) of the
Theft Act 1968 with fraudulently obtaining property. It was
alleged by the police that at the beginning of April 1981 the
G first defendant had caused advertisements to be placed in
several local newspapers inviting the public to send cheques
to the second defendant, a private company wholly owned by
the first defendant, for the purchase of certain electronic
appliances which neither the first defendant nor the second
defendant possessed at any material time. On dates after
April 7, 1981, cheques received in response to those advertise-
ments were alleged to have been paid into a bank account
H which the second defendant had with the third defendant.
On an application by the police for an injunction pursuant
to R.S.C., Ord. 29, r. 2, restraining the defendants by them-
selves, their servants or agents from making any withdrawals,
1
R.S.C., Ord. 29, r. 2: "(1) On the application of any party to a cause or
matter the court may make an order for the detention, custody or preservation of
any property which is the subject matter of the cause or matter, or as to which any
question may arise therein, or for the inspection of any such property in the
possession of a party to the cause or matter."