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Reproduced with the permission of 94 Law Quarterly Review (1983) 376-406

Uniform Statutes in English Law

Francis A. Mann [*]

Uniform statutes are provisions enacted or authorised by Parliament and derived from treaties or similar arrangements which a group of nations agrees to incorporate into their respective legal systems with a view to unifying legal rules in a particular field. Even though, as a matter of form, the legislative act itself is, in constitutional law, usually the direct and, indeed, the only source of municipal enforceability, the fact that uniform statutes are the ultimate product of a treaty constitutes their special characteristic. That fact has numerous consequences which it is proposed to examine: Is the interpretation of uniform statutes subject to peculiar rules? In particular, is it possible and perhaps even necessary by some process of interpretation to fill gaps in the uniform text? Do uniform statutes really succeed in unifying the law? If not or not entirely, how are divergences to be overcome or, in other words, what is the relationship between uniform laws and the conflict of laws? Is the idea and object of unification of law a head of public policy and, if so, does it eliminate conflict rules and does it perhaps even have a bearing upon rules of jurisdiction?

When some of these questions were examined on a previous occasion,[1] attention was drawn to, and to some extent a distinction was made between, the various methods practised in England with a view to giving effect in English law to the terms of the treaty. The following observations will deal only with the fourth of these methods, viz. a statute the schedule to which sets forth the text of the treaty and has the force of law. This may now be described as the most usual method and may well be on a different footing from the others, particularly from the second method which involves an Act of Parliament making "such provision as is contained in this Act" and, perhaps, adding the treaty informationis causa only. It is necessary to make the scope of the following suggestions very clear, for some confusion may have been introduced into the subject by a remark of Lord Wilberforce who said of the decision of the House of Lords in Ellerman Line Ltd. v. Murray [2] that it was "atypical and in my opinion should no longer be followed."[3] [page 376]

That decision related to the interpretation of a statute of the second type as defined, for it translated "the international language of the Convention into the phraseology of the Merchant Shipping Acts " and directed "that the Act is to become part of and construed as one with the other acts of that code."[4] Such a method may now be atypical, although the Arbitration Act 1975 in substance adopts it by the description in the Preamble referring to an "Act to give effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards." But whether or no the method is atypical it is entirely different from the situation with which Lord Wilberforce was concerned and which these pages envisage, namely the case in which Parliament "is, broadly speaking, merely machinery rather than the source of law" or, in other words, "is not the real law-giver, but merely the law-transformer,"[5] the treaty itself being the (indirect) source of law. Murray's case has therefore lost none of its authority in the field contemplated by it.


The ultimate object in interpreting uniform statutes is not open to doubt. It is to find answers conforming to the wording, purpose and idea of the treaty and acceptable to all or most of those countries which have ratified it. As Scott L.J. put it,[6] "the maintenance of uniformity in the interpretation of a rule after its international adoption is just as important as the initial removal of divergence ..." The real question is how this can be achieved.

It has become fashionable to take as a guide Lord Macmillan's instruction [7] that the language "should be construed on broad principles of general acceptation."[8] Today it may be submitted with greater confidence than ever before [9] that such principles are those prevailing in and developed by public international law. For both Lord Diplock and Lord Scarman have recently stated [10] with the fullest possible justification that the interpretation of uniform statutes is governed by the Vienna Convention on the Law of Treaties and has thus become one [page 377] of the principal points at which public international and private law meet. The relevant provisions of the Vienna Convention read as follows:[11]

Article 31

General rule of interpretation.

1. A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose.

2. The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes:

(a) any agreement relating to the treaty which was made between all the parties in connexion with the conclusion of the treaty;
(b) any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty.

3. There shall be taken into account, together with the context:

(a) any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions;
(b) any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation;
(c) any relevant rules of international law applicable in the relations between the parties.

4. A special meaning shall be given to a term if it is established that the parties so intended.

Article 32

Supplementary means of interpretation.

Recourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstance of its conclusion, in order to confirm the meaning resulting from the application of Article 31, or to determine the meaning when the interpretation according to Article 31:

(a) leaves the meaning ambiguous or obscure; or
(b) leads to a result which is manifestly absurd or unreasonable.

Admittedly these Articles were designed primarily with a view to texts which are not only concluded under the control of public international law, but also regulate relations between States. But in law there is no difference between such treaties and those contemplating relations between private persons: Articles 31 and 32 apply to both types. Moreover, it does not matter that, technically, the Vienna Convention applies only to treaties concluded after January 27, 1980, when it [page 378] came into effect, for, as again Lord Diplock made clear,[12] it "does no more than codify already existing public international law."

If, then, Articles 31 and 32 are taken as a starting point for the interpretation of uniform statutes enacted by Parliament, certain consequences follow.

1. The first and foremost guide to construction should be the ordinary meaning of the words used in the uniform statute. This is entirely in accordance with English law, for already half a century ago Lord Atkin said:[13]

"For the sake of uniformity it is, therefore, important that the courts should apply themselves to the consideration only of the words used without any predilection for the former law, always preserving the right to say that words used in the English language which have already in its particular context received judicial interpretation may be presumed to be used in the sense already judicially imputed to them."

The paramount importance of the literal interpretation has in recent years sometimes been neglected.[14] Thus in Fothergill v. Monarch Airlines Lord Wilberforce stated in terms:[15] "I start by considering the purpose of Article 26 and I do not think that in doing so I am infringing any golden rule." Lord Diplock, with the concurrence of Lord Keith of Kinkel, Lord Roskill, Lord Brandon of Oakbrook and Lord Brightman, went even further: words forming part of an international Convention "should be given a purposive rather than a narrow literalistic construction"[16] and the latter, somewhat contemptuous [page 379] phrase was emphasised by being repeated a little later. The result was the neglect and even the distortion of the statutory words in a manner which in the course of almost 50 years had apparently not ever or anywhere been put forward. It is submitted with great respect that as a matter of construction it is difficult to defend this approach. In general it is the observance of Article 31 of the Vienna Convention rather than the golden rule known to English law or what Lord Diplock called "a narrow literalistic interpretation" that matters, for the very aim of ensuring uniformity of interpretation is best served by starting from and adhering to the ordinary meaning of the actual words used by the framers of the treaty. Contrary to what is sometimes thought of as continental methods of construction, the predominance of the text has repeatedly been emphasised, for instance, by the Federal Supreme Court of Germany which in a fundamental decision said [17] that a uniform law had to be interpreted "in good faith in accordance with the ordinary meaning which attaches to its provisions in their context and in the light of its object and purpose." A later decision is more diffuse, but it should be quoted in full, because it will have to be referred to in several connections:[18]

"German courts are unrestrictedly entitled to construe international Conventions where according to their content they are destined to create uniform private law in the member-States and, after transformation into the municipal legal systems, to be applied directly to the legal relations between private parties ... In their case the object of uniformity of the law merits special attention. The unification of the substantive law is intended to render it unnecessary to examine the question of the conflict of laws which legal system is to be applied and as far as possible to protect the parties from the application of 'foreign' law. It conforms to the object of unification to interpret and if necessary to amplify such Conventions autonomously. ... In this connection generally recognised principles of interpretation of private law are to be applied. Therefore an interpretation is required which starts from the wording, but which, particularly where travaux préparatoires do not help, gives effect to the logical-systematic context of the individual provisions and to their meaning and purpose. Conceptions of municipal law may not be accepted unhesitatingly, because otherwise the purpose of unification of law may be endangered. Rather the interpretation is to be accomplished in the sense of the uniform statute itself with the object of a hopefully uniform application in all member-States."

It is, however, very clear that notwithstanding its primacy the literal or textual interpretation is liable to be inconclusive. The recent decision [page 380] of the House of Lords [19] on the words "other charges incurred in respect of the carriage of goods" is significant. These words occur in Article 23(4) of the Convention on the Contract for the International Carriage of Goods by Road, the so-called C.M.R., which is scheduled to the Carriage of Goods by Road Act 1965. Was excise duty in respect of stolen whisky paid by the plaintiffs included in those words and therefore recoverable by the plaintiffs from the defendant carriers? All courts gave an affirmative answer, although the majority in the House of Lords was three to two only. The result is noteworthy, since in ordinary language the word "charges" may not readily include excise duties.

2. It is now established that for the purpose of ascertaining the ordinary meaning of a uniform statute it is legitimate to refer to a foreign text irrespective of whether it is the only authentic one upon which the English text is based or whether its authenticity is equal with that of the English text.[20] Very frequently, however, this is again a fruitless effort, as it was in the two recent English cases. In particular the French phrase "frais encourus à l'occasion du transport" gives rise to the same problem as its English counterpart: neither "charges" nor "frais" would normally signify excise duty.

What is not yet clear is whether an English court is permitted to look at texts translated into other languages. Thus it would hardly be open to doubt that the German counterpart of the English phrase "charges incurred in respect of the carriage of goods," viz. the words "sonstige aus Anlass der Beförderung des Gutes entstandene Kosten" cannot reasonably be understood as including excise duties;[21] the same would probably apply to the Dutch word "vervoerskosten" which Lord Wilberforce referred to as part of a decision of the Amsterdam court rejecting the carrier's liability for excise duty.[22] It is submitted that a translated text is a permissible and frequently a useful guide to decision, for it is likely to indicate how one of the High Contracting Parties understood the authentic text.

From the point of view of literal interpretation the Dutch court held that excise duty was more of a "subsequent levy or administrative fine than an item of charges in respect of carriage." This seems to be plainly right and is not refuted by Lord Wilberforce's observation that it "seems to overlook the distinction between 'carriage charges' and 'other charges' in Article 23(4)." In both cases the text requires [page 381] "charges," in the first case charges for the carriage, in the second case charges connected with the carriage such as expenses for packing, unpacking, repacking, customs declarations and examinations, perhaps insurance and similar services of the carrier arising from and connected with the carriage.

The general impression which the decision of the House of Lords on the meaning of "carriage charges" in Article 23 of C.M.R. leaves on the reader's mind is that the ordinary meaning of the word may not at present receive the primary weight which one might expect, and this is certainly not displaced by a similar approach of the House of Lords in a later, though much clearer, case in which the word "damage" or "avarie" was held to include (partial) loss.[23]

3. The terms of the treaty cannot, however, be read in isolation. Rather they should be construed "in their context." This is nothing new. Already in 1961, when construing the words "due diligence to make the ship seaworthy" in Article III, rule 1 of the Hague Rules scheduled to the Carriage of Goods by Sea Act 1924, the House of Lords held it necessary to pay particular regard to their history, origin and context."[24] Accordingly, the meaning of those words was held to be that which since a decision of 1895 [25] had been attributed to them in England and was in conformity with that prevailing in Canada, New Zealand and the United States of America.[26] Certainly, as Lord Atkin said,[27] the courts should not display any "predilection" for the local law preceding the Convention, but where the words have been considered and used by courts highly experienced in the subject it is a reasonable inference that the Convention, when using the same word or phrase in connection with the same subject-matter, in all probability does not intend to reject its established meaning; the term may in such circumstances be said to have a special meaning in the sense of Article 31(4) of the Vienna Convention. This has nothing to do with the specifically English rule, first stated in 1870 by James L.J.,[28] according which, where a word of doubtful meaning has received a clear judicial interpretation, the subsequent statute which incorporates the same word or the same phrase in a similar context must be construed so that the word or phrase is interpreted according to the meaning that [page 382] has previously been assigned to it.[29] It is simply common sense that if the Convention adopts a phrase which appears to have been taken from one legal system or from some, where it is used in a specific sense, the international legislators are likely to have had that sense in mind and to intend its introduction into the Convention. History, origin and context, therefore, are peculiarly apt to throw light on the literal meaning. These are elements which are capable of proof. They do not involve guesswork. They are free from the hazards which often bedevil the assessment of a rule's rationale or purpose. Thus when the C.M.R. Convention speaks of "charges," "frais," "Kosten," it is unlikely that in the field of road transport a definite meaning had previously been assigned to any of these terms. Or when the Treaty of Versailles created a "charge" on enemy property, it could not reasonably be a measure subject to English equitable interests.[30] But when a Convention relating to shipping law speaks of "due diligence to make the ship seaworthy" and when, since 1895, the English-speaking world had understood these words in a certain sense, one can well sympathise with Lord Simonds who "emphatically" subscribed to statements by Lord Hailsham and Lord Sumner who said that, when the Convention employs but forbears to define a widely used phrase it shows a clear intention to continue and enforce the old clause as it was previously understood and regularly construed by the courts.[31]

4. The next step in the process of interpretation is to look at the treaty "in the light of its object and purpose" -- words which in every language seem to be tautological and the distinction between which has never been explained and, apparently, has not even been discussed. Perhaps the Vienna Convention intends to express two different aspects of interpretation, namely in the first place the object or purpose of unification, which the treaty as a whole undoubtedly pursues, and secondly the object and purpose of the particular provision the terms of which fall to be construed. Irrespective of whether or no such was the intention of the Vienna Convention and whether or no the words used by it are apt to express the two aspects, it should not be open to doubt that for the purpose of interpretation both of them are material and significant. Their effect requires deeper consideration than it has so far received.

(a) As regards the first point, that is, the object or purpose of applying the Convention so that it implements and promotes the unification of [page 383] the law, this means in practice that the courts should adopt that interpretation which has been or is most likely to be applied by the greatest number of countries. To be even more specific, this means that a judge in England should follow the practice of influential foreign courts even if he himself would not have reached the same result. This is "subsequent practice in the application of the treaty," which Article 31(3)(b) of the Vienna Convention makes an aid to construction, although in a purely English context subsequent practice may be excluded from consideration.[32] What is necessary, therefore, is a comparative approach and a capacity to assess the weight and the probable impact of foreign decisions and, possibly, of academic work.

It is a remarkable and, probably, regrettable fact that the House of Lords seems to be disinclined to permit such a course. Lord Salmon, it is true, took a step towards it, when he said,[33] "If a corpus of law had grown up overseas which laid down the meaning of Article 23, our courts would no doubt follow it for the sake of uniformity which it is the object of the Convention to establish. But no such corpus exists." This would seem to mean that if there exists a uniform practice abroad, the English courts would follow it -- nothing else can be meant by the reference to a "corpus of law." A practice which is divergent provides little guidance and the English courts have shown themselves markedly and surprisingly reluctant even to have regard to it. Thus both Lord Wilberforce and Lord Diplock [34] have explained in some detail why in interpreting the Warsaw Convention of 1929 on international carriage by air they preferred to ignore foreign decisions: they were not always decisions of the highest courts; they were not binding; the process of law reporting varies; the facts are not always clearly discernible. At the same time considerable weight was given to academic writings -- a fact which is not free from perversity if one remembers the reluctance of English courts even to consider the writings of English academic lawyers as well as the reasons for it or, to put it differently, if one is aware of the great circumspection with which continental writings must be treated and of the necessity for weighing the standing, reputation and expertise of the author.

It is certainly true that, to take a probably extreme case pointed out by Megaw L.J.,[35] in six member-States 12 different interpretations of the same words may be produced. But if there are few foreign decisions and if one of them is clearly and persuasively reasoned, as happened in a [page 384] recent case decided by the House of Lords,[36] the English courts, it is suggested, should follow that case and thus intensify and probably secure a uniform interpretation, albeit, that in the absence of the foreign decision they would have reached the opposite result. In particular, where, as in fact happened, two Law Lords adopted the foreign decision and its reasoning,[37] the majority of three Law Lords would have better served the object and purpose of the Convention, viz. the uniformity and harmonisation of the law, if they had refrained from going their own way. As so often, Lord Denning M.R. led the way, when he said in Corocraft v. Pan American Airways [38] that even if he disagreed with certain American decisions he "would follow them in a matter which is of international concern. The courts of all the countries should interpret the Convention in the same way." If foreign decisions have been rendered by supreme tribunals and all of them clearly point in one direction only, English courts which go a different way (as "indefensibly"[39] happened in connection with Article VIII (2)(b) of the Bretton Woods Agreement) badly neglect what may be described as a plain duty.[40] Academic opinion, on the other hand, is never binding, never completely available and rarely expressed with a view to the particular facts in issue. While it should certainly be considered, it should not necessarily be preferred to judicial practice.

(b) Although the (general) object and purpose of creating a uniform practice does not seem to have been in the forefront of English judges' minds, the (specific) object and purpose of the text requiring interpretation in casu has attracted predominant attention -- so much so that in England a text is now rarely interpreted "in accordance with the ordinary meaning ... in the light of its object and purpose," but "purposive interpretation" has become the almost paramount guide. The trouble is that the purpose of a provision may not always be obvious. Of course, where "damage" has to be notified to an Airline within a certain time limit, this is required for the protection of the Airline which will wish to check the passenger's statements, to make inquiries and to assess the extent of the damage; in such circumstances it is not difficult to hold that "damage" includes (total or partial) [page 385] loss.[41] But other cases will be less easy to decide. It is to be noted that in holding that excise duty was covered by the phrase "charges incurred in respect of the carriage" the majority of the House of Lords did not attempt to found its decision on an investigation of the purpose of the provision. In many cases the danger in fact will be that the object and purpose of a particular provision is speculative or even obscure or equivocal. Thus in reference to the words "charges incurred in respect of the carriage" Lord Denning M.R. said:[42]

"I ask myself: what was the intention -- the design or purpose -- behind it all? It seems to me that it was intended that the sender should not be limited to the value of the goods as defined in Article 23(1) ... But that he should also be compensated for any additional expense that he incurred directly by reason of the loss."

With great respect, it is impossible to infer this from the Convention. There is much to be said in favour of a conclusion in the opposite sense. It is satisfactory to note that, as mentioned above, not even the majority of the House of Lords (which in the result agreed with Lord Denning) based its decision on purposive interpretation. Nor did Lord Edmund-Davies and Lord Fraser in their dissenting speeches. These did not thereby become less persuasive.[43]

5. As Article 32 of the Vienna Convention makes clear, a supplementary and, one may add, very much subsidiary means of interpretation is recourse to travaux préparatoires. For the purpose of construing an international Convention this is now accepted by English law.[44] In the light of Article 32 this must be described as a foregone conclusion: indeed, Lord Diplock [45] was probably right in suggesting that in the case of treaties concluded after January 27, 1980, the applicability of Article 32 is obligatory, and in such cases it is by no means free from doubt whether Lord Wilberforce [46] would be entitled to impose two conditions upon the use of travaux préparatoires, viz. "that the material involved is public and accessible, and, secondly, that the travaux préparatoires clearly and indisputably point to a definite legislative intention." These are conditions which go to weight (with which Article 32 is not concerned) rather than admissibility.

The real problem, therefore, is what are relevant travaux préparatoires and what weight should in a given case be given to them. These are [page 386] questions of great general scope, which far exceed the field of treaties, which cannot be comprehensively discussed in the present context and to which it may be necessary to revert. Suffice it to emphasise that the cases in which travaux préparatoires can profitably be used must be "rare,"[47] indeed exceptional. That the minutes of September 27, 1955, which the House of Lords considered [4] and which reproduce a discussion on the meaning of "damage" were inconclusive is so obvious that no detailed reference is required. But by way of example both Lord Diplock and Lord Fraser [49] referred to another minute of September 20, 1955, where, in relation to a vote taken on a certain amendment, it is stated "The President stated that, in the event of a negative vote on the proposal, the Conference would be understood as having stated that the word 'unreasonable' was not necessary, because it was already implied in Article 19 as at present drafted." Both Lord Diplock and Lord Fraser seem to have taken the view that a minute of this type could be material and perhaps even helpful. Respectful doubt cannot be suppressed. Suppose the majority or some of the delegates disagreed with the President, but remained silent, not necessarily on account of Machiavellianism which according to Lord Diplock "is not extinct at international conferences,"[50] but, for instance, because they were anxious to avoid a long discussion with a foolish President. Is the opinion expressed by the President relevant material? It would be a different matter if the President had not stated his own view, but had purported to summarise the delegates' intentions or had summarised the result of an informal test. But it is submitted that even in the absence of recorded contradiction the President's statement does not carry any weight. It is no more than a personal opinion. It does not imply any legislative intent or authority.


Not long ago Lord Denning M.R. carried the technique of "purposive interpretation" to considerable lengths by suggesting that it would or should enable the court to fill gaps.[51] The House of Lords rejected that suggestion, not only because it denied the existence of a gap as opposed to a question of construction, but also because for the courts to fill it would encroach on the province of Parliament and involve the courts in legislation.[52] [page 387]

It is likely that, contrary to Lord Denning's assumption, this attitude is in line with continental judicial practice. Thus it is true that in 1976 Germany's Federal Supreme Court stated that it was open to the courts to "amplify" a uniform statute in order to give effect to its objects and purposes,[53] and it is not difficult to find academic support for such treatment. It would appear, however, that, if one disregards the jurisprudence of the European Court of Justice which stands on its own and is characterised by a unique mixture of literalism and passion for "integration," actual practice frowns upon the judicial filling of gaps. By way of example it may be useful to consider the Federal Supreme Court's practice on the question of the air carrier's liability for luggage which the passenger takes with him on board the aeroplane. Article 18 of the Warsaw Convention renders the carrier liable for damage sustained in the event of the destruction or loss of or damage to any registered luggage or goods. What is sometimes known as "cabin luggage" is not dealt with. There is a gap. The German Federal Supreme Court held that it was to be filled by reference to domestic German law, for "the provisions of German air law are superseded by the Warsaw Convention only to the extent to which they are inconsistent with its rules."[54] Or Article 21, C.M.R. deals with consignments providing for "cash on delivery," without defining the meaning of "cash." Does it mean payment in specie or is payment by cheque or similar methods permitted? There is a gap in the Convention. The German Federal Supreme Court filled it by applying the proper law of the contract, found it to be German and held that under German law payment by cheque is not permitted.[55]

It would no doubt be possible to find other examples pointing in the same direction. Always with the exception of the European Court of Justice, which pursues a practice of its own creation, no court faced with a genuine gap, as opposed to a problem of construction, will wish to become a legislator or adopt a solution other than the German one.


The preceding observations render it apparent that divergent interpretations of uniform statutes are almost bound to occur, however diligently judges may strive to prevent them. The result is diversity where uniformity ought to prevail. The longer uniform statutes are in force the greater is the extent of differences in interpretation. In 1970 the late Dr. O.C. Giles published an illuminating book on the treatment of international Conventions in national courts.[56] After a comparative survey of uniform laws relating to bills of lading, air transport, bills of [page 388] exchange and miscellaneous other subjects he arrived at the cautious conclusion that it was not possible to proclaim either success or failure, but "that, as in other fields of human endeavour, the perfect solution has eluded the grasp of those creating uniform1aw, although important progress has been made."[57] Thirteen years later the instances of diversity have probably become more numerous and the observer's scepticism in regard to unification as a matter of practical politics has become more pronounced.[58] No complete survey such as that offered by Dr. Giles in regard to commercial law can be attempted here, but in order to provide some evidence in support of the subsequent remarks a few particularly significant examples deserve to be mentioned.

In the first place it is necessary to remember that it is not only the judicial interpretation, but also the text of the so-called uniform statute which may differ from country to country. The Hague Rules of 1924 were adopted in many forms: The Protocol to the Hague Rules of 1924 and Article 16 of the Hague-Visby Rules of 1968 permit acceptance by the introduction of their provisions in a form adapted to the respective national law. Brandon J. (as he then was) spoke of their Romanian, Greek and English versions.[59] There are States which have failed to accept them in any form, others such as Australia have modified them, some adopted the Hague Rules of 1968.[60] Some applied them to outward shipments, others to both outward and inward shipments. Striking differences have occurred in connection with the conversion of monetary limits into local currency. It will be remembered that Article IV (5) of the Hague Rules scheduled to the Carriage of Goods by Sea Act 1924 fixed the limit of liability at 100 (taken at gold value) per "package," It appears that in the member-States this sum was translated into local currency at values which varied between U.S. $62.50 and U.S. $1.55.[61] A decision of the Cour d'Appel in Paris [62] throws interesting light on the resulting situation: bills of lading relating to the shipment of goods from New York to Le Havre were issued in New York and submitted to New York law, including the Carriage of Goods by Sea Act 1936. The liability for damage was limited in New York to $500 per unit, in France to 100 gold value; for reasons which are difficult to follow the latter amount in terms of French francs was much less than the former. The court gave judgment for an amount of francs [page 389] corresponding to 100. Most Conventions which fix maximum amounts of liability permit conversion into local currency; the Warsaw Convention on air transport, for instance, expressly so provides in Article 22(4). It is obvious that the value of such local sums may frequently and quickly change, so that it differs both from the maximum amount fixed in other countries and from the current value of the amount stated in the Convention itself. A judge in a third country who is called upon to award a sum of money to a plaintiff in country A against a carrier in country B will have to remember that the carrier's costs and, therefore, the amount charged by him to the passenger or shipper were no doubt calculated by reference to a maximum amount of liability contemplated by a particular legal system. To hold him liable for an amount prevailing in another legal system would run counter to his and probably the plaintiff's legitimate expectations.

Differences of judicial interpretation are less easily ascertainable, yet equally telling. Take by way of example Article III (6) of the Hague Rules, according to which liability ceases, "unless suit is brought within one year," "à moins qu'une action ne soit intentée," "wenn der Anspruch nicht innerhalb eines Jahres geltend gemacht wird." Is the commencement of arbitration proceedings covered by this phrase? In Germany the wording is such that an affirmative answer is required.[63] The same view is held in France, although the wording by no means supports it,[64] and a fundamental decision of the Court of Appeal has in England arrived at the same result.[65] But in the United States of America the Court of Appeals, Second Circuit, rendered the astonishing decision that arbitration proceedings are not covered by the word "suit " and that therefore an arbitration clause has the effect of excluding any time limit.[66] Another example of great significance is the interpretation put in England upon Article III (1) of the Hague Rules, according to which the shipowner is liable for lack of seaworthiness caused by the negligence of an independent contractor.[67] This conclusion is not universally shared; the Scandinavian countries in particular hold a different view.[68] Or take the famous question whether for the purposes of the Hague Rules the container or each of the cartons contained in it is a package. A decision of the Federal Supreme Court of Germany [69] deals with a situation in which the container had a value of DM 1,250 and the 627 cartons in it had a value of DM 14,000 odd. The court awarded the former amount, but it seems that the American [page 390] practice takes the opposite view.[70] Again it must be emphasised that the German carrier who contracts under German law and who assesses his freight on the basis of German judicial practice should not suddenly be confronted by an English, American or Swiss judge or arbitrator with a liability according to United States law. The converse conclusion is equally true: the American carrier who expects to be liable for DM 14,000 or takes out an insurance policy accordingly should not suddenly be allowed to invoke German law and make a profit equal to about nine-tenths of his expected liability.

One of the most notorious examples of disharmony surrounds the interpretation of Article VIII (2)(b) of the International Monetary Fund Agreement. In France and Germany, where there exists a rich judicial practice, an exchange contract within the meaning of that provision is a contract which in any way affects a country's exchange resources so as to be liable to reduce them,[71] This was originally accepted by the Court of Appeal in England in 1967.[72] In 1976 the Court of Appeal abandoned this view and defined an exchange contract as a contract to exchange the currency of one country for that of another as well as contracts which are a monetary transaction in disguise and in 1982 the House of Lords, without a word of independent reasoning, adopted this definition.[73]-[74] In this way a far-reaching cleavage has arisen; in creating it the courts were oblivious of their plain duty to construe uniform statutes as far as possible so as to promote uniformity.[75] At the same time the House of Lords allowed a second cleavage to arise:[76] ignoring decisions of the New York Court of Appeals [77] it held that an autonomous English documentary credit: was in part an unenforceable exchange contract -- a result fraught with danger to the international financial community.

The most vivid picture of what he calls the "judicial diversification" of the Warsaw Convention on air transport was drawn more than 10 years ago by that great expert, Professor Mankiewicz.[78] From the many examples which he gives it is useful to select the problem raised by the conception of "place of business" in Article 28 of the original Warsaw Convention which deals with jurisdiction at the option of the plaintiff.[79] The question whether that expression, being a translation of the French "etablissement," comprises another Airline or a mere travel [page 391] agency which issues the ticket, provoked numerous decisions, particularly in England, France and the United States of America. No uniform practice developed. The results were in 1976 carefully compiled by the Federal Supreme Court of Germany [80] which felt able to avoid a decision. Yet it arrived at the surprising result that a ticket of the Bulgarian Airline which had been issued by the Deutsche Lufthansa in Germany where the Bulgarian had a "station" enabled the plaintiff to bring his action in Germany. Since the "station" of the Bulgarian Airline had no contact with the plaintiff or, indeed, the public and seems to have carried out purely internal operations, the decision may go much further than most others.

The list of instances which illustrate differences in the terms or the interpretation of uniform statutes could be continued for many pages and with reference to many uniform statutes. An enumeration of such examples would add nothing to the clarification of the real problem: What is their effect in international legal practice? How are they to be dealt with by a judge? What is the principle guiding towards a reasonably satisfactory solution? To this problem it is now necessary to turn.


1. In general the solution of the conflict should be achieved by the classical process of applying the lex causae and, in particular, the proper law of the contract. Irrespective of whether the lex causae has adopted or failed to adopt the uniform law or has accepted it subject to variations or has interpreted it in a specific sense, in principle its law should be followed in the forum. This will not by any means render it necessary in every case to investigate the content of the foreign law; where neither party alleges a divergence, the court or arbitrator is entitled and, indeed, required to take the lex fori as a guide.

The proposed rule is in harmony with the demands of justice as well as the requirements of established law. To disregard the content of the proper law would in many, perhaps in most, cases lead to the exclusive control of the lex fori and therefore to unsatisfactory results, for it would necessarily set aside the expectations of the parties. Take a bill of lading issued in Rio de Janeiro under Brazilian law for a shipment from Rio to Hamburg and providing for the jurisdiction of the English courts or for arbitration in London. The carrier has no doubt calculated freight on the basis of his potential liability under Brazilian law. He has covered himself by insurance to the same extent. The conflict of laws was developed for the very purpose of protecting what used to be called vested rights, i.e. the contractual or other rights and obligations as created by the proper law. To override them cannot be readily supported. [page 392]

Moreover, it is elementary that whenever a set of facts involves a foreign element we are instructed to ascertain the legal system that applies, the proper law or the lex causae.[81] There is no reason of principle, logic or justice why, as a rule and where the circumstances so require, the same process should not be gone through in the case of uniform states in particular or statutes in general -- for the primary and paramount impact of the conflict of laws is entirely independent of the nature of the substantive law, i.e. of the question whether this is statutory or common law. There cannot be any rational distinction between the two sources of English law. If this were not so all 1aw on the Continent would be applicable irrespective of any conflict rule, for there all law is statutory. No such suggestion has ever been made.

The foregoing submissions are by no means devoid of judicial and academic support. Admittedly it has often been suggested on the Continent [82] that uniform laws render the conflict of laws unnecessary, but the case of a contradiction between the statutory texts and the judicial interpretations in various countries has hardly ever been squarely faced. Nor has the general problem been much discussed in this country; in fact it is possible that there are only two statements which clearly propound an accurate assessment.[83] On the judicial level the Warsaw Convention fell to be considered by the Court of Appeal in a case in which the plaintiffs were the owners of two boxes of platinum which were flown by South African Airways from South Africa to London and there transferred to the defendants who were to fly them to the United States of America. Only one box arrived. The other one was held to have been stolen in London by a loader employed by the defendants. The Court of Appeal held that the defendants' servants acting within the scope of their employment had been guilty of wilful misconduct and that therefore the defendants were liable for the full value of the stolen box as provided for by Article 25 of the Warsaw Convention.[84] Eveleigh L.J. said: [page 393]

"In my opinion the Warsaw Convention should be construed in accordance with the law which governs the contract of carriage, for the Convention is incorporated into that contract. In the present case it is agreed between the parties that the law applicable to the contract of carriage is South African law. No special evidence was called, however, as to the effect of South African law ... and that being so, the court has to proceed on the basis that South African law is the same as English law. Thus we arrive at the position where the court has to decide whether, according to the rules of English law, this servant was acting with wilful misconduct within the scope of his employment."

On the question of principle one should perhaps also mention the important decision of the court in Monterosso Shipping Co, Ltd. v. International Transport Workers Federation,[85] which clearly proves that the applicability of an English statute depends on the proper law of the contract being English, and that, subject to statutory prohibition, illegality or public policy, a reasonable choice of law bona fide made overrides the mandatory rules or any other law and is the very essence of the doctrine of the proper law,

2. An exception to the proposed rule arises where the uniform law or the statute incorporating it lays down its own conflict rule which eliminates or restricts the parties' choice. Thus a special rule is included in the Australian Carriage of Goods by Sea Act which provides that the Hague Rules shall apply to every bill of lading issued in Australia without regard to any submission to a different system of law.[86] A special conflict rule, though a limited one, is also supplied by Article 41 of the C.M.R. Convention according to which "any stipulation which would directly or indirectly derogate from the provisions of this Convention shall be null and void." If, therefore, the parties agree that a contract for the carriage of goods by road which would normally be subject to the C.M.R. Convention should be governed by the law of a country which has failed to adopt it, then such a choice of laws is null [page 394] and void.[87] In such circumstances it is legitimate to speak of a choice of law being prohibited. The fact that provisions of a type well known to international practice have not been included in a particular uniform law should make it very difficult to read them into such a Convention (e.g. the Hague-Visby Rules).[88]

It should, however, be clearly appreciated that provisions which define and delimit the scope of the Convention or the statute adopting it do not come within the category now under discussion or involve the prohibition of a choice of law. Provisions which make application dependent upon the nationality of the parties, the type of carriage, cargo or shipment, the countries between which goods are carried or similar enactments are not conflict rules, but have a substantive character in that they indicate the scope of the Convention. They are not conflict rules, because they do not prescribe the application of a particular legal system or rule, but deal with the field of application of a Convention or statute known to be applicable.[89]

One of the most famous examples which has to be considered in the present context is Article X of the Hague Rules or, in an amended form, of the Hague-Visby Rules. The text of both versions leaves no doubt but that it does not constitute a conflict rule, as in fact academic writers have frequently pointed out.[90] Nor is there for present purposes any real difference between the two versions. According to the earlier version the Rules applied if the bill of lading was issued in a contracting State. The more recent version repeats this provision and adds the case of a carriage from a port in a contracting State. But since the bill of lading is almost invariably issued in the port of shipment, this addition cannot have much significance or, in particular, alter the character of the provisions in Article X. Nor should it make any difference that the Carriage of Goods by Sea Act 1924 did not incorporate Article X of the Hague Rules into English law, but that section 1 of the English statute rendered the Hague Rules applicable to shipments from any British port, while the Carriage of Goods by Sea Act 1971 merely refers to the Hague-Visby Rules, including Article X, to which it gives the force of law. Pace Dr. Morris [91] the mere fact of transposition does not change [page 395] the character of the provision, The incorporation of Article X as such means that the Hague-Visby Rules have a wider scope in that they cover a shipment, not merely from Britain, but from any contracting State, It ought not to mean that the widened scope dispenses with the precondition of the bill of lading being governed by English law. Dr. Morris, it is true, suggests that the move of the self-limiting provision from the legislation implementing the Rules into the Rules themselves means "that an English court would now hold the Rules to be applicable, e.g., to a shipment between two foreign contracting States." If this means anything it is that Article X has become a conflict rule with the following unacceptable result: let us assume that both Brazil and Germany apply the Hague-Visby Rules, but Korea does not, A shipment from Rio de Janeiro to Hamburg on a Korean vessel under a bill of lading governed by Korean law, but providing for arbitration in London would be subject to the Rules, although neither German nor Brazilian nor Korean law so permits, Or Dr, Morris would have to hold that, although neither Germany nor Brazil nor Korea accept a construction of Article III (1) of the Rules, according to which a shipowner is liable for lack of seaworthiness resulting from an independent contractor's negligence, the English court or arbitrator would ignore the conflict rule and apply the English interpretation in the opposite sense.[92] No international or national legislator can have intended this. On the contrary, he was well aware of the Protocol of Signature to the Brussels Convention of 1924 and Article 16 of the Convention of 1968 both of which allow contracting States to include the Rules in their own legislation "in a form appropriate to" it (and thus to perpetuate diversity).

3. No exception to the general rule should, however, be derived from the fact that when the English legislator adopts a Convention he gives it "the force of law." Such a phrase does not confer upon a uniform law a different or higher status than is enjoyed by any other rule of English common or statutory law and, in particular, does not exempt it from the operation of the conflict of laws or bring about the unacceptable consequence of making the lex fori paramount. Yet Dr. Morris asserts it as "the truth ... that when an international Convention on the law of transport is given the force of law in the United Kingdom, its provisions apply to all disputes within its scope, regardless of the proper law of the contract."[93] [page 396]

For the reasons given this submission lacks persuasiveness, but in regard to the Carriage of Goods by Sea Act 1971 it seems, for the time being, to have been accepted as the ratio decidendi by the House of Lords in the case of The Hollandia.[94] Goods were shipped from Britain to a Dutch port on a Dutch vessel. The bill of lading provided for Dutch jurisdiction and the application of Dutch law. Both clauses were held to be null and void, for, as Holland has not adopted the Hague-Visby Rules, the ship-owner's maximum liability was less than in England, so that the two clauses had the effect of lessening the ship-owner's liability defined by the English Act of 1971. If in the present context one disregards the question of construction which arose and is referred to above,[95] one asks oneself how the House of Lords arrived at a result which, once again, is embodied in a single opinion by Lord Diplock and which the House seems to have had singularly little difficulty in reaching, though the implications may be far-reaching.[96]

The difficulty lies in ascertaining how Lord Diplock came to apply English law, i.e. to ignore the conflict rule which by virtue of an unquestionably valid choice pointed to Dutch law. Although one is reminded of public policy, when Lord Diplock [97] rejects what nobody has ever suggested, viz. that it could be "open to any shipowner to evade the provisions of Article III (8) by the simple device of inserting" any forum or choice of law clause,[98] the ratio decidendi cannot have been English public policy, which is not mentioned in the speech at all.

It can only have been based on the existence of a statute which was interpreted as invalidating or prohibiting (pro tanto) any clause having the effect of lessening the shipowner's liability. The statutory character of the English rule was sufficient to displace the proper law of the [page 397] contract. Such a conclusion would give rise to enormous problems should the Sale of Goods Act 1979 prevail over a valid choice of law? Or did Lord Diplock regard Article X of the Hague-Visby Rules as a conflict rule or as a prohibition of a choice of law? An affirmative answer may have been intended, for in the last paragraph of the speech emphasis is put on "the express inclusion in the Hague-Visby Rules of Article X (absent from the Hague Rules) expressly applying the Hague-Visby Rules to every bill of lading falling within the description contained in the Article."[99] Such an interpretation would attract the doubts expressed above about Dr. Morris's views and provokes the further comment that in so far as shipments from Britain are concerned the Rules applied since 1924, it being irrelevant whether they applied by virtue of the statute or by virtue of the Convention having statutory force, but they had to be part of the proper law. Any "distinction between the 1924 Act and the 1971 Act" or any "contrast between the legislative techniques adopted in the two Acts" cannot, therefore, be in point. Or why did Lord Diplock emphasise that the "1971 Act deliberately abandoned what may conveniently be called the 'clause paramount' technique employed in section 3 of the 1924 Act?"[1] This is a difference without a distinction, for the essential Article III (8) is identical in both Acts. Once more one can only conclude by regretting the absence of additional speeches.


Irrespective of the proper law chosen by the parties the Hague-Visby Rules or, indeed, any uniform statute would be applicable in an English court in its English interpretation if public policy so required. This would be an instance of public policy in its positive form and occurs, in the words of Savigny,[2] where "laws of a strictly positive, imperative nature" are involved.[3] One may admit that statutes may be expressive of public policy, but it is difficult to see why uniform statutes in general or statutes relating to international transport in particular [4] should be a matter of public policy.

The late Sir Otto Kahn-Freund, it is true, for many years described "the policy of unification as a paramount international ordre public" and in somewhat general terms advocated resorting to it, when uniform [page 398] statutes fall to be considered.[5] Similarly, in The Hollandia [6] Lord Denning M.R. in the Court of Appeal referred to "the public policy which demands that in international trade all goods carried by sea should be subject to uniform rules." But English courts have traditionally been most diffident in applying public policy, unless fundamental standards of morality, justice or welfare or, as has been very felicitously suggested, human rights were at stake.[7] The unification of law or of transport law in particular is a matter of "political expediency" in the sense of Parke B.'s phrase.[8] Even in so far as it is a matter of legal policy it cannot be a matter of public policy in the eyes of anyone who remembers how inadequate, illusory and elusive unification is in the real world. In other words unification is an abstract ideal. In the concrete case what is or purports to be done in its name may often contribute to the intensification of diversity.

On the other hand it may be said that it is the specific provision in a uniform statute that should be treated as being expressive of public policy and, therefore, requiring application in all situations. From this point of view it must be asked: can it really be a matter of English public policy that, for instance, a shipowner should be liable for each kilo of gross weight rather than for each package or unit lost or damaged? A question of this type (and many similar ones can be formulated) can, it is submitted, only be answered in the negative.

It is possible that an entirely different aspect of public policy was in Lord Diplock's mind, when, as mentioned above, he emphasised that it was not "open to any shipowner to evade the provisions of Article III, rule 8 by the simple device of inserting in his bills of lading issued in, or for carriage from a port in, any contracting State"[9] a clause excluding the law of the port of shipment. The point is of such importance that it must be repeated that nobody has ever asserted the contrary. It cannot have been part of the appellant's case in The Hollandia to do so. A bill of lading governed by the law of the country to which the carrying vessel belongs and to which the goods are intended to be carried, is not to be condemned on the ground that it is an evasion or a device. It is a perfectly normal and legitimate clause universally used in international trade, embodied in numerous standard forms and supported by weighty reasons of commercial requirements and expectations. The point relates, not to public policy, but to the limits of the parties' freedom of choice. No theory, no form of words has ever been put forward with a [page 399] view to restricting that freedom in the circumstances underlying the decision in issue. How the limits are to be defined does not need discussion in the present context.[10]


Many uniform statutes define the courts in which actions arising from their terms may be brought. Article 31 of the C.M.R. Convention is an example: actions may be brought in the court of a contracting country designated by agreement between the parties, in the place of the defendant's ordinary residence or place of business or the place where the goods were taken over by the carrier or where delivery is to take place. Similarly, Article 28 of the Warsaw Convention on transport by air allows actions to be brought in four jurisdictions. Such rules are of a procedural character and will always have to be applied by a court in a contracting State even in the absence of a provision such as Article 41 of the C.M.R. Convention or Article 32 of the Warsaw Convention which prohibit deviations. Where the uniform statute does not include provisions of this type, they ought not to be implied on the ground that the statute is mandatory and its implementation could be impeded or evaded by a forum clause. The very fact that, against the background of so many uniform statutes regulating jurisdiction, a particular uniform statute does not include a forum clause precludes, it is submitted, any interpretation limiting freedom of contract.

The problem is by no means confined to uniform statutes, but is a general one.[11] Its correct solution has been most impressively demonstrated by the Supreme Court of the United States in the great case of The Bremen:[12] a German company undertook with an American corporation to tow a drilling rig from Louisiana to Italy. The contract which included certain exemption clauses contrary to the public policy of the United States and invalid there provided for the decision of disputes by the High Court of Justice in London. The Supreme Court, in an opinion delivered by Chief Justice Burger, held that the forum clause was valid, "unless enforcement is shown by the resisting party to be unreasonable." Such a refusal could not be based on the fact that the English court would give effect to the exemption clauses; the effectiveness of the forum clause was excluded only in the event of enforcement contravening "a strong public policy of the forum in which suit is brought, whether declared by statute or by judicial decision." Another [page 400] telling example of international practice is a decision of the Federal Supreme Court of Germany.[13] A German, resident and working in Germany, was the commercial agent of a Dutch industrial enterprise. His contract was terminated and under mandatory provisions of German law he became entitled to compensation. When he brought proceedings in Germany, the defendant Dutch company relied on a clause in the contract according to which the Dutch courts had jurisdiction and Dutch law (denying compensation) applied. The action failed. The court assumed that in the absence of special terms German courts would have had jurisdiction, German law would have applied and the defendant had intended to eliminate the German provisions about compensation. It also assumed that there could be circumstances in which the clause would have been unreasonable. Yet the connection with Holland was close and constituted "grounds which justified the defendant in wishing to submit the contract with the plaintiff to Dutch law and jurisdiction." It is believed that the reasoning of both the American and the German decision is exemplary.

In the case of uniform statutes the same reasoning should prevail, but the picture is much more blurred. The controversy primarily relates to the Hague and Hague-Visby Rules of 1924 and of 1968 respectively. Neither of them deals with jurisdiction. It is apparently only the Australian Act according to section 9 of which any term "purporting to oust or lessen the jurisdiction of the courts of the Commonwealth or of a State in respect of the bill of lading or document shall be illegal, null and void, and of no effect." Notwithstanding this model the American Carriage of Goods Act 1936 does not contain a similar term. For this very reason an excellent decision by three judges of the Court of Appeals, Second Circuit, in 1955 held that forum clauses were not inconsistent with the Act or the Hague Rules.[14] In 1967, however, nine judges of the Court of Appeals, Second Circuit, imputed to the legislator the intention to invalidate forum clauses in a bill of lading if they excluded an available jurisdiction of an American court.[15] Belgian courts, particularly the commercial tribunal in Antwerp, have taken a similar line.[16] On the other hand the French Cour [page 401] de Cassation [17] as well as numerous Courts of Appeal [18] and the supreme tribunals of Holland [19] and Germany [20] have decided in the opposite sense and allowed forum clauses, sometimes in circumstances which were quite remarkable. Thus in Germany the forum clause was enforced even if the judgment of the agreed court was not enforceable in Germany, one of the reasons being that "the internationally usual clauses about jurisdiction in regard to bills of lading regularly determine the court at the carrier's principal seat of business as having jurisdiction" and in the interest of international practices this had to be respected.[21]

Until recently there was strong reason to believe that English law was to the same effect. The binding character of jurisdiction clauses has often been emphasised [22] and in relation to the Hague Rules of 1924 a decision of the Court of Appeal of 1927 [23] was widely understood to express the same principle. Goods were shipped from England to Bombay; the bill of lading contained the usual clause conferring jurisdiction [page 402] on the courts of the place of destination. The action brought by the consignees in England was dismissed, Scrutton L.J. saying: "The only difference is a question of procedure -- where shall the law be enforced? -- and I do not read any clause as to procedure as lessening liability." The point did not arise again until The Hollandia [24] was decided in 1982 under the Carriage of Goods by Sea Act 1971 (which in this respect is in no way different from the Act of 1924). It will be remembered that the House of Lords was concerned with a clause in a bill of lading which in relation to a shipment from Scotland to a Dutch port on a Dutch vessel provided for Dutch jurisdiction and law.[25] Both parts of the clause were considered "colourable devices"[26] designed to lessen the carrier's liability. As regards the forum clause in particular, the choice of the carrier's and the place of destination's forum was described as" a court of convenience, viz. one situated in a country which did not apply the Hague-Visby Rules or, for that matter, a country whose law recognised an unfettered right of a shipowner by the terms of the bill of lading to relieve himself from all liability."[27] In a further passage, Lord Diplock said that if the dispute was about duties referred to in Article III (8) and if the foreign country would award a lower sum than envisaged by Article IV (5) of the Hague-Visby Rules then an English court is in my view commanded by the 1971 Act to treat the choice of forum clause as of no effect."[28] It is most important to realise that there is no difference between the Hague and the Hague-Visby Rules on the point of principle; the latter certainly calculate the compensation differently, but even under the Hague Rules which continue to apply in all but about a dozen countries in the world other differences on numerous points could have arisen. Yet a wide range of countries has given effect to the clause employed by The Hollandia and described by the Federal Supreme Court of Germany as the "internationally usual" one, though in the eyes of the House of Lords it was a "colourable device." One cannot help coming back to the same point which in England more than elsewhere one would have expected to be a compelling one: in the case of a uniform statute more than in any other it is impermissible to imply clauses which could have been, but are not included in it, or to allow the ultimate or indirect "effect" of a contractual provision to override the text of the statute [page 403] or to treat as a colourable device a clause which has much practical advantage to commend it. But the most unfortunate consequence is: that a kind of legal chauvinism ensures the reign of English law and courts whereas international tolerance used to be the hallmark of English commercial law.

It should, however, be remembered that, when section 2 of the Civil Jurisdiction and Judgments Act 1982 is put into effect, Article 17 of the 1968 Convention is likely, as between the member States of the E.E.C., to supersede the law laid down by the House of Lords; Article 57 will not apply, because the Hague-Visby Rules are not a Convention which governs jurisdiction. Moreover, not even the House of Lords asserted the invalidity of the prorogation agreement as such or for all purposes.


Arbitration clauses are also a subject which many uniform statutes specifically deal with. Thus reference may once more be made to the C.M.R. Convention which allows an arbitration clause to be included in a contract of carriage on condition that it provides that the tribunal shall apply the Convention. Apart from such express terms arbitration clauses should, in general, have the same fate as forum clauses. Since, however, most countries in the world are members of the New York Convention on arbitration, section 1(1) of the Arbitration Act 1975 will, in regard to bills of lading, cause a serious problem in England, for where there is an international arbitration agreement, the court is required to stay proceedings. Is it the consequence of The Hollandia that where a bill of lading issued in Scotland in respect of a shipment from Britain to the Netherlands on a Dutch vessel provides for arbitration in Amsterdam proceedings brought in England are to be stayed, while in the event of an agreement on the jurisdiction of Dutch courts the English action can proceed? It would be an odd inconsistency and it is not certain whether Lord Diplock gave a convincing answer to it. He seemed to assume that there would also be a choice-of-law clause and continued:[29]

"But if the particular choice of substantive law made by the express clause is such as to make the clause null and void under the law of the place where the contract was made, or under what, in the absence of such express clause, would be the proper law of the contract, I am very far from accepting that it would be open to the arbitrator to treat the clause as being otherwise than null and void or to give any effect to it."

This would seem to mean that in the assumed circumstances the English court would refuse to stay the proceedings on the ground that [page 404] the arbitration clause was null and void under English law. Since ex hypothesi English law would not be the proper law (for the arbitration clause is presumed to import a reference to Dutch law [30]) and since validity is governed by the proper law,[31] invalidity could only be based on the clause being contrary to English public policy or being prohibited by statute. For the reasons given, the former argument would constitute a radical departure from tradition, while the latter one cannot be supported by the Hague-Visby (or the Hague) Rules as formulated by the international legislator, but is likely to prevail in the English courts in the curious pro tanto fashion discovered by Lord Diplock. The argument seems to imply that whenever a choice of law clause, a forum clause or an arbitration clause would have the effect of a departure from the law on bills of lading as laid down in the Carriage of Goods by Sea Act 1971 and as understood and applied in England it is to that extent null and void. It is submitted that this would be an extravagant and at the same time a parochial conclusion,[32] which affects international trade with unusual intensity and the implications of which will have to be worked out over many years.[33]

If, following Belgian and rejecting Dutch, French and German practice, the House of Lords had founded its decision (which rests on arguments equally applicable to the Hague Rules [34]) on public policy and clearly defined the circumstance and scope of its application, one could have become reconciled with the result, however regrettable the introduction into English law of what are believed to be repugnant ideas would have been. The gravamen of the grievance is that the [page 405] interpretative approach as well as the basis and reach of the decision are lacking principled explanation and analysis.[35] [page 406]


* F.B.A., LL.D. (Lond.), Dr. Jur. (Berlin), Hon. Dr. Jur. (Kiel and Zürich), Member of The Institut de Droit International, Honorary Professor of Law in the University of Bonn, Solicitor in London.

1. "The Interpretation of Uniform Statutes" (1946) 62 L.Q.R. 278, also to be found in Studies in International Law (1973), p. 614. Since then the literature has grown considerably. See, in particular, Sinclair (1963) 12 I.C.L.Q. 508; Brownlie, Principles of Public International Law (3rd ed., 1979), p. 50 with further references. For a comparative survey see Schreuer, British Year Book of International Law 1971, p. 255. As to Germany see Bayer (1955) 20 RabelsZ 603. As to Italy see Giardina (1973) Rivista dl Diritio Internazionale 701.

2. [1931] A.C. 126.

3. James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141, 153. In support of the suggestion in the text it is possible to refer to a dictum by Lord Denning M.R. in Corocraft v. Pan American Airways [1969] 1 Q.B. 616, 653, to the effect that in Murray's case "the English statute was clearly given priority over the Convention."

4. Barras v. Aberdeen Steam Trawling & Fishing Co. [1933] A.C. 402, 431, per Lord Blanesburgh, at p. 441, per Lord Russell of Killowen. See, already, the former's remarks in [1931] A.C. 126, 133.

5. See the present author's paper referred to supra, note 1, at pp. 268, 290 or p. 630.

6. The Eurymedon [1938] P. 41, 61. Many similar statements are to be found in later cases.

7. Stag Line Ltd. v. Foscolo Mango & Co. Ltd. [1939] A.C. 328, 350.

8. See James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141, 154, per Lord Wilberforce, at p. 161, per Lord Salmon; Fothergill v. Monarch Airlines [1981] A.C. 25I, 285, per Lord Fraser, at p. 293, per Lord Scarman; The Hollandia [1983] A.C. 565, 571, per Lord Diplock.

9. The point of the present author's article referred to supra, note 1, was to suggest that uniform statutes should be interpreted according to the principles of public international law. It took 35 years for such a suggestion to be accepted.

10. Fothergill v. Monarch Airlines [1981] A.C. 251, 282, 290 respectively.

11. Cmnd. 7964.

12. Fothergill v. Monarch Airlines [1981] A.C. 251, 282. Contrary to the opinion expressed by Lord Fraser at p. 289 it does not, therefore, matter, when the treaty came into effect.

13. Stag Line Ltd. v. Foscolo Mango & Co. Ltd. [1939] A.C. 328, 343.

14. This is so even outside the field of uniform statutes. See the worrying comment by Lord Diplock upon the construction by Lord Simonds of the Finance Act 1933 in Fothergill v. Monarch Airlines [1981] A.C. 251, 280.

15. Ibid. at p. 272. Italics supplied.

16. The Hollandia [1983] A.C. 565, 572, relating to the Carriage of Goods by Sea Act 1971 and the Hague-Visby Rules scheduled thereto. The argument rejected by the House of Lords was that Art. III (8) of the Hague-Visby Rules literally corresponding with Art. III (8) of the Hague Rules renders null and void and of no effect "any clause, covenant or agreement relieving the carrier from liability ... or lessening such liability." A clause providing for the jurisdiction of the Dutch courts and submitting the bill of lading to Dutch law was held to be void, because it "would have the effect of lessening the carrier's liability" as compared with English law (ibid. at p. 574F). In substance, therefore, the House of Lords did not look to the words or to the "clause, covenant or agreement," but to their effect. The difficulty is aggravated, when it is realised that Art. III (8) speaks of a clause being "null and void and of no effect," while Lord Diplock is compelled to rewrite these words and to hold that a forum and choice-of-law clause is valid at its inception, remains valid in many respects and, if and when a case of invalidity arises, is "of no effect" only "pro tanto" (ibid. at p. 575F) -- implications which are plainly irreconcilable with the text. Lord Diplock's interpretation now constitutes English law, but it is to be hoped that the method employed by the Hoese of Lords will be confined to the Carriage of Goods by Sea Act 1971 and will not be followed abroad. It is a method which renders it almost impossible so to draft an international Convention that it does not produce unforeseen and unforeseeable consequences. See further, infra, p. 405.

17. BGHZ 52, 220 (June 25, 1969). The statement or principle is almost identical with the text of Art. 31 of the simultaneous Vienna Convention.

18. NJW 1976, 1583 (March 19, 1976). Citations have been omitted.

19. James Buchanan & Go. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141.

20. Ibid. See also Folhergill v. Monarch Airline, [1981] A.C. 251.

21. Quite apart from the use of the word "Kosten" the German text speaks of charges payable by reason of the carriage (as opposed to "in consequence of the carriage").

22. James Buchanan & Go. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141, 153-154.

23. Fothergill v. Monarch Airlines [1981] A.C. 251.

24. Riverstone Meat Co. Pty. v. Lancashire Shipping Co. Ltd. [1961] A.C. 807, 836, per Viscount Simonds who, incidentally, relied on dicta in Barras v. Aberdeen Steam Trawling & Fishing Co. [1933] A.C. 402. It must again be emphasised that, although the dicta were point, the case, like Ellerman Line Ltd. v. Murray [1931] A.C. 126, was different from it involved in Riverstone Meat.

25. G. E. Dobell & Co. v. Steamship Rossmore Co. Ltd. [1895] 2 Q.B. 408.

26. See, e.g. Riverstone Meat Co. Pty. v. Lancashire Shipping Co. Ltd. [1961] A.C. 807, per Lord Hodson at p. 874.

27. Stag Line Ltd. v. Folcolo Mango & Co. Ltd. [1939] A.C. 328, 343.

28. Ex parte Campbell (1870) L.R. 5 Ch. 703, 706.

29. See Webb v. Outrim [1907] A.C. 81, 89; Gosse, Millard Ltd. v. Canadian Government Merchant Marine Ltd. [1929] A.C. 223, 230, per Lord Hailsham, at p. 237 per Lord Sumner; Barras v. Aberdeen Steam Trawling & Fishing Co. [1933] A.C. 402, 411, per Lord Buckmaster, at p. 430 per Lord Warrington, at p. 442 per Lord Russell of Killowen, at p. 446 per Lord Macmillan; Riverstone Meat Co. Pty. v. Lancashire Shipping Co. Ltd. [1961] A.C. 807, 837, per Viscount Simonds.

30. Josef Inwald A.G. v. Pfeiffer (1928) 44 T.L.R. 352 (H.L.).

31. For references see supra, note 29.

32. As to contracts see F. L. Schuler A.G. v. Wickman Machine Tools Sales Ltd. [1974] A.C.235.

33. James Buchanan & Go. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141, 161.

34. Fothergill v. Monarch Airlines [1981] A.C. 251, 275, 276, 284.

35. Ulster-Swift Ltd. v. Taunton Meat Haulage Ltd. [1977] 1 W.L.R. 625.646; see also Michael Galley Footwear Ltd. v. Laboni [1982] 2 All E.R. 200.

36. See the Dutch case mentioned by Lord Wilberforce in James Buchanan & Co. Ltd. v. Babco forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141, 153-154.

37. Lord Edmund-Davies and Lord Fraser of Tullybelton in the case mentioned in the preceding note.

38. [1969] 1 Q.B. 616, 655.

39. The phrase is Sir Joseph Gold's: Staff Papers of the International Monetary Fund 28 (1981), p. 747.

40. Wilson Smithett & Cope Ltd. v. Terruzzi [1976] Q.B. 683, approved by the House of Lords in United City Merchants (Investments) Ltd. v. Royal Bank of Canada [1982] 3 W.L.R. 1039. On these cases and the relevant foreign material see Mann, The Legal Aspect of Money (4th ed., 1982), p. 384 et seq., pp. 397-398 and (1982) 98 L.Q.R. 526. These decisions are irreconcilable with the intention, proclaimed in James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141 and Fothergill v. Monarch Airlines [1981] A.C. 251, so to construe an international Convention as to promote uniformity. For this reason alone the decisions on Art. VIII (2) (b) are bound to cause misgivings.

41. This was decided in Fothergill v. Monarch Airlines [1981] A.C. 251.

42. James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1977] Q.B. 208, 214.

43. It should be made very clear that at any rate in relation to treaties purposive construction is nothing new to English law. Already in Imperial Japanese Government v. P. & O. Steam Navigation Co. [1895] A.C. 644, 657 Lord Herschell said: "The treaties must be interpreted according to their manifest spirit and intent. In construing such instruments a too slavish adherence to the letter would be out of place, although, of course, violence must not be done to the language used."

44. Fothergill v. Monarch Airlines [1981] A.C. 251.

45. Ibid. at p. 283.

46. Ibid. at p. 278.

47. Ibid. at p. 278.

48. Ibid. at p. 283, per Lord Diplock.

49. Ibid. at pp. 282 and 289 respectively.

50. Ibid. at p. 283.

51. James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1977] Q.B. 208, 213.

52. James Buchanan & Co. Ltd. v. Babco Forwarding and Shipping (U.K.) Ltd. [1978] A.C. 141. An international tribunal cannot fill gaps: see O'Connell, International Law (2nd ed., 1970), p. 256.

53. See the citation supra, note 17.

54. BGHZ 52, 213, 72, 389 (November 29, 1978).

55. BGHZ 83, 96, 101 (February 10, 1982).

56. Uniform Commercial Law (A. W. Sijthoff: Leyden).

57. Ibid. at p. 193.

58. A particularly grave misfortune would happen if the United Kingdom allowed itself to be persuaded to adopt the Convention on the Law Applicable to Contractual Obligations (Cmnd. 8489) which the Commission of the European Economic Community felt called upon to promote. It is about the worst example of misguided enthusiasm for "harmonization."

59. The Elefteria [1970] P. 94, 101-102.

60. According to Chaveau, Droit Maritime Français (1978), p. 3 the 1968 version applied only in Denmark, Ecuador, France, Lebanon, Norway, Singapore, Sweden, Switzerland, Syria and the United Kingdom.

61. Braekhus, Rec. 164 (1979 iii), p. 322.

62. October 24, 1966, Droit Maritime Français (1967), p. 23.

63. Schaps-Abraham, Seerecht (4th ed., 1978). s. 612, n. 6.

64. Rodiere, Traite General de Droit Maritime, ii (1968), No. 782.

65. The Merak [1965] P. 223.

66. Son Shipping Go. Inc. v. De Posse & Tanghe, Sorer Bond Ltd., 199 F. 2d 687 (1925).

67. Riverstone Meat Go. Pty. Ltd. v. Lancaster Shipping Go. Ltd. [1961] A.C. 807.

68. Braekhus, Rec. 164 (1979 iii), 329, who wisely adds that a situation such as this renders the conflict rules "necessary even for cases lying within the area of the application of Conventions adopted by all the States to which the case has connections."

69. BGHZ 78, 121 (September 22, 1980).

70. The Aegis Spirit [1977] 1 Lloyd's Rep. 93.

71. For details see Mann, The Legal Aspect of Money (4th ed., 1982), p. 384 et seq.

72. Sharif v. Azad [1967] 1 Q.B, 605.

73.-74. United City Merchants (Investment) Ltd. v. Royal Bank of Canada [1982] 2 W.L.R, 1039.

75. See supra, pp. 377,385, text to notes 6 and 38.

76. See the detailed Note in (1982) 98 L.Q.R. 526.

77. See supra, note 71 for references.

78. (1972) 21 I.C.L.Q. 718.

79. Ibid. at pp. 745-747.

80. NJW 1976, 1586, 1587 (March 23, 1976) or IPRspr. 1976 No. 123c. See the more recent decision of June 16, 1982, BGHZ 84, 339.

81. That this is the function of the conflict of laws is, more or less clearly, stated in the first paragraph of every single book dealing with the subject. One of the clearest formulations is to be found in Martin Wolff, Private International Law (2nd ed., 1950), s. 1, who says that "if in the facts of the case there is some foreign element ... then its legal repercussions can only be examined when the preliminary question as to the applicable law has been answered." But Cheshire & North, Private International Law (10th ed., 1981), p. 3 also say in the first sentence of the book: "That part of English law known as Private International Law comes into operation whenever the court is seised of a suit that contains a foreign element."

82. See, for instance, the Federal Supreme Court of Germany, supra, note 17, but see also note 55.

83. Martin Wolff, Private International Law (2nd ed., 1950), s. 6, says that "where such unified internal laws have been created, all problems of private international law disappear -- unless the agreed rule is variously interpreted in the countries concerned." And Sir Otto Kahn-Freund, Hague Rec. 143 (1974 iii), p. 193 says: "Not as if such substantive unification obviated a recourse to the rules of private international law ... Yet this unification of substantial portions of commercial law, whilst far from making conflict rules redundant, reduces the urgency of their unification in practice."

84. Rustenberg Platinum Mines Ltd. v. Pan American Airways [1979] 1 Lloyd's Rep. 19, commented upon by Mann (1979) 95 L.Q.R. 346, It is a pity that Dicey and Morris ignore this case and the compelling statement by Eveleigh L.I. at p. 24. The decision of Bingham J. in Bofors-Uva v. Scandia Transport [1982] 1 Lloyd's Rep, 410 is not very clear on the point which does not appear to have been argued. Goods were shipped from Sweden to England under a waybill to which the C.M.R. Convention applied and which was held to be subject to Swedish law and to provide for arbitration in Sweden. In interpreting the C.M.R. provisions the learned judge said that he was "not, of course, applying Swedish law as the appropriate governing law for interpreting the Schedule to an English Act." It is submitted that the thought underlying this sentence is incorrect. On the other hand there was no evidence that Swedish law on the point was different from English law. That point involved the question whether the reference to Swedish law (which has accepted the C.M.R. Convention) was a sufficient "provision" within the meaning of Art.33.

85. [1982] 3 All E.R. 841. For an earlier case see, e.g. Sayers v. International Drilling Co. [1971] 1 W.L.R. 1178.

86. s.9.

87. The principal English provision of the same type is s. 27 of the Unfair Contract Terms Act 1977 on which see Mann (1978) 27 I.C.L.Q. 661.

88. But see below section 3 on the decision of the House of Lords in The Hollandia [1983] A.C. 565.

89. On this type of self-limiting substantive provisions see Mann, British Year Book of International Law 1972-1973, p. 117 at p. 121.

90. See, for instance, Sir Otto Kahn-Freund, Hague Rec. 143 (1974 iii), p. 240; Stödter, Liber Amicorum Algot Bagge (Stockholm 1956), p. 220 et seq.; Schaps-Abraham. Seerecht (4th ed., 1978), s. 662, n. 8; Röper in Reithmann, Internationales Vertragsrecht (3rd ed., 1980), p. 395. That the Hague Rules apply only if the proper law of the contract so directs is well established in Germany and Holland. See Court of Appeal Hamburg, November 30, 1978, IPRspr. 1978 No. 36A and, on the other hand, Hoge Raad, May 13, 1966, Rev. Crit. 1967, 522 (shipment from Antwerp to Rio de Janeiro on Dutch vessel; choice of Dutch law valid).

91. (1979) 95 L.Q.R. 59 et seq., especially at p. 64.

92. On this see supra, note 67. The discussion in the text is subject to the effect of the decision in The Hollandia [1983] A.C. 565, referred to in the following s. 3.

93. Op. cit., supra, note 91 at p. 66. It is difficult to understand why the statement is confined to Conventions on the law of transport. On p. 64 Dr. Morris imputes to the present writer the view that if both Britain and Norway have adopted the Hague-Visby Rules and the bill of lading in respect of the shipment from Britain to Norway is subject to Norwegian law, it "can escape the Rules." Nothing of the kind was suggested. The only suggestion was that the choice of law prevails. If Norway has adopted the Hague-Visby Rules they apply, and they do so in their Norwegian incarnation or interpretation.

94. [1983) A.C. 565.

95. See above note 16.

96. It is understood that at the beginning of the argument their Lordships announced that they had read the papers. The appellant's argument was allowed to take about three hours. The respondent's counsel was not called on.

97. [1983] A.C. 565, 574. Italics supplied. The case in point was one where the genuineness, legality and customary character of the clause could not be doubted. See also Infra. p. 399. The "familiar 'floodgates' argument" used by Lord Diplock has been rejected by Lord Fraser of Tullybelton and Lord Roskill in Junior Books Ltd. v. Veltchi Go. Ltd. [1983) A.C. 520, 532, 539. In these circumstances there exists perhaps additional reason for surprise at Lord Roskill's concurrence with Lord Diplock's speech "in all respects."

98. In so far as the conflict of laws is concerned Lord Diplock's speech in The Hollandia includes some remarkable dicta. (1) It is submitted that the possibility of a reference to Dutch law "including its private international law" (p. 573) cannot in truth be envisaged. (2) If goods are shipped on a Dutch vessel to a Dutch port from a Scots port it is by no means certain that "the proper law would prima facie at any rate be Scots law" (p. 573). (3) On p. 576 Lord Diplock seems to support the proposition that the validity of a choice of law depends on "the law of the place where the contract was made" or on "what, in the absence of such express clause, would be the proper law of the contract." Such views are likely to be in conflict with accepted teachings. (4) In the last sentence of the speech, doubt is thrown on the meaning of "wide-ranging dicta" in one of the greatest cases in English law decided by one of the strongest judicial committees ever formed, viz. the Vita Food Products case [1939] A.C. 277. The alleged obscurities were not specified.

99. [1983] A.C. 565, 577. It should perhaps be made clear that in so far as "the forte of law" is concerned 1here is no difference between the Act of 1924 and that of 1971. The former employs the phrase in the Preamble and when in s. 1 it uses the words "shall have effect" it does not mean anything different: Vita Food Products case [1939] A.C. 277, 287, per Lord Wright.

1. [1983] A.C. at p. 577.

2. A Treatise 011 the Conflict of Laws (translated by W. Guthrie), s. 349.

3. Dicey and Morris at p. 22 speak of overriding statutes. The expression is unobjectionable except that it creates a special category of statutes only.

4. They are being put into a separate class by Dicey and Morris at p. 842.

5. See (1953) 39 Transactions of the Grotius Society 65, also to be found in Selected Writings at p. 256; The Growth of Internationalism in English Private International Law (Jerusalem, 1960), pp. 43-46.

6. [1982] Q.B. 872 at p. 884.

7. In this connection the European Convention on Human Rights may have to be considered.

8. Egerton v. Brownlow (1853) 5 H.L. Cas. 1, 123.

9. See supra, note 97.

10. On this problem see Mann (1950) International Law Quarterly 60, 597; Morris, ibid. at p. 297. It should be emphasised that the problem of evasion is entirely outside the scope of this article.

11. The literature is considerable. It must suffice to refer to Sir Otto Kahn-Freund (1977) 26 I.C.L.Q. 825, who mentions many earlier writers.

12. 407 U.S. 1 (1972), particularly at pp. 15, 16 and see the English counterpart, Unterweser Reederel G.m.b.H. v. Zapata Off-Shore Co. [1968] 2 Lloyd's Rep. 158, both noted at (1972) 88 L.Q.R. 472.

13. NJW 1961, 1061 (January 30, 1961).

14. W. H. Muller & Co. Inc. v. Swedish American Line Ltd., 224 F. 2d 806 (1955).

15. Indussa Corporation v. The Ramborg, 377 F. 2d 200 (1967). It is not impossible that the court felt that in the circumstances of the case the forum clause was "unreasonable," but the decision is being applied generally and without regard to the implications of the decision in The Bremen, 407 U.S. 1 (1972). See, e.g. Northern Assurance Co. v. Caspian Career [1977] American Maritime Cases 421; Misui Co. Ltd. v. The Glory River, 464 F. Supp. 1004 (1978); Pacific Lumber & Shipping Co. v. The Star Shipping, ibid. at p. 1314, where a clause for arbitration in London was set aside.

16. Cass., June 9, 1932, Pas. 1932 I 183 (goods shipped from Antwerp to Turkey on German vessel; bill of lading providing for German law and jurisdiction; Belgian law held to be d'ordre public); Cass., December 19, 1946, Pas. 1946 I 480 (goods shipped from Belgium to Hamburg; bill of lading subject to Belgian law, but jurisdiction of Hamburg courts; held valid, because no reason to think that Hamburg courts would not apply Belgian law); Trib. Brussels, December 7, 1972; Jur. Anv. 1973, 103; Com. Antwerp, May 29, 1973, Jur. Anv. 1974, 250; September 4, 1973, ibid. 1973, 360, 365; Trib. Brussels, October 31, 1974, Droit Europ. Transp. 1975, 50; Com. Antwerp, April 8, 1976, Jur. Anv. 1974, 380; April 15, 1975, ibid. 1975-76, 84; September 16, 1976, ibid. 1976, 453, and many other cases.

17. Cass. Com., July 7, 1969, Droit Maritime Français (1969), p. 671; shipment from Portugal to France on Portuguese vessel; bill of lading providing for exclusive jurisdiction of Lisbon court, held valid.

18. Court of Appeal Rouen, November 14, 1978, D.M.F. 1979,274: shipment on Moroccan vessel from Rouen to Casablanca. Bill of lading provides for exclusive jurisdiction of Moroccan courts in the form of the Conlinebill (Baltic and International Maritime Conference). Held valid, because Hague Rules do not forbid forum clauses. In the same sense Court of Appeal, Paris, March 11, 1963, D.M.F. 1964, 375; Rouen, December 1, 1977, ibid. 1978, 590; May 15, 1979, ibid. 1980, 469; August 28, 1979, ibid. 1979, 604 (goods shipped on Belgian vessel from Beira to Le Havre; bill of lading providing for jurisdiction of Belgian courts; held valid and excluding French jurisdiction); Court of Appeal, Paris, June 27, 1980, D.M.F. 1981, 85 (goods shipped from Marseilles to Mauretania on Spanish vessel; bill of lading providing for Spanish law and jurisdiction; held "que la Convention de Bruxelles ne comporte, en ce qui concerne la comptence, aucune clause derogatoire au droit commun francais ainsi qu'il resulte des termes de l'article 14 de cette Convention"); December 6, 1980, ibid. 1981, 85.

19. Hoge Raad, May 13, 1966, Rev. Crit. 1967, 522.

20. December 8, 1968, IPRspr. 1968/9 No. 198 (shipment from U.S.A. to Hamburg, so that Hague Rules as understood in Germany applied; Dutch carrier issued bill of lading; "all questions ... shall be settled in and in accordance with laws of the country of carrying company."); February 12, 1970, ibid. No. 112; December 21, 1970, NJW 1971, 325; February 8, 1971, NIW 1971, 985; December 9, 1973, IPRspr. 1973, No. 128b (shipment from Bangkok to Hamburg, so that Hague Rules as applied in Germany prevailed; proper law German, but exclusive jurisdiction Bangkok); Court of Appeal Hamburg, February 12, 1970, IPRspr. 1970, No. 112a, affirmed on other grounds by the decision of December 21, 1970. In one case, however, the Supreme Court treated it as relevant whether the foreign court would apply the Hague Rules: "In view of the purpose of the law the protection of the mandatory provisions of the Hague Rules must be guaranteed for the German consignee. In this sense the forum clause cannot be held valid irrespective of the foreign court's decision:" December 3, 1973, IPRspr. 1973, No. 128b.

21. See the decision of December 21, 1970 mentioned in the preceding note.

22. See Dicey and Morris at p. 255 with references.

23. Maharani Woollen Mills Co. v. Anchor Line (1927) 29 LI.L.R. 169, followed by Scarman J. (as he then was) and by the Court of Appeal in The Merak, [1965] P. 223. Both cases were referred to by the Court of Appeal, but disregarded in Lord Diplock's speech.

24. [1983] A.C. 565.

25. The clause also reproduced a provision of Dutch law limiting liability in accordance with the Hague Rules. This did not add anything to the reference to Dutch law as the proper law.

26. [1983] A.C. 565, 573. It is very difficult to understand how commercial lawyers of great experience could come to accept this characterisation. Numerous forms of bills of lading that are in general use and numerous judicial decisions have accepted a reference to the law and the courts of the ship's nationality (and of the place of destination) as the most appropriate choice of law. This is so for strong practical reasons.

27. Ibid. at p. 574G.

28. Ibid. at p. 575D.

29. Ibid. at p. 576D.

30. Dicey and Morris at p. 1127, notes 28 and 29.

31. Ibid. at p. 1127, note 27.

32. The idea of partial nullity which Lord Diplock applied in The Hollandia [1983] A.C. 565, and which he had already developed in the United City Merchants (Investment) Ltd. case [1983] A.C. 168 is novel, not supported by the text of any statutory rule, difficult to apply in practice and almost arbitrary in character. A search for any precedent has been unsuccessful. The idea of severability is something quite different: nullity of a clause leaves the rest of the contract intact. Here partial nullity means that although the statute prescribes the total invalidity of a certain clause or contract an entirely different clause or contract is held to be invalid only if, when and in so far as it may lead to the result of the proscribed clause or contract being upheld. It is submitted that the fundamental reason for so surprising a theory lies in the neglect of the principles of statutory interpretation which do not permit the radical deviation from the text or the disregard of general rules of the conflict of laws. The comparable case of The Bremen, 407 U.S. 1 (1972) is inspired by much more traditional ideas.

33. The final question which apparently has not ever or anywhere been discussed is whether the nullity of "any clause, covenant or agreement in a contract of carriage" attracts the nullity of the whole contract evidenced by the bill of lading so as to subject the contract to the general law applicable where no bill of lading is issued, or whether the contract evidenced by the bill of lading less the offending clause remains in force. Nor is there any material on the problem of ascertaining the legal system which provides the answer to that question. It is submitted that the proper law should apply, and that if this is English the nullity of one clause is likely to involve the nullity of the written contract as a whole so as to hold the parties to their common law rights and duties.

34. For this reason the points made in the last paragraph of Lord Diplock's speech do not, it is respectfully submitted, constitute a convincing answer. The change in legislative technique or the amendment of Article X were not the ratio decidendi of the decision of the House of Lords. This is to be found exclusively in Art. III, r. 8 which exists since 1924.

35. The unacceptable implications of The Hollandia are vividly illustrated by Sheen J.'s decision in The Benarty, April 26, 1983, not yet reported. Goods were shipped at Hamburg, Bremerhaven, Antwerp, Cherbourg and London for carriage to Indonesia on a British ship chartered by Indonesians. At each port the Indonesian charterers issued bills of lading providing for the exclusive jurisdiction of Indonesian courts and the application of Indonesian law. Neither the Hague nor the Hague-Visby Rules apply in Indonesia. The Hague Rules apply in Germany, the Hague-Visby Rules apply in Belgium, France and Britain. The learned Judge applied the Carriage of Goods by Sea Act 1971 and disregarded the express choice of forum and law. It is difficult to think of a more extreme case. To impose British legislation upon German, Belgian and French shippers and Indonesian carriers may be a misapplication of The Hollandia, but proves the unprincipled character of the latter decision.

Pace Law School Institute of International Commercial Law - Last updated May 2, 2006
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