MARITIME NATIONAL FISH, LTD Vs. OCEAN TRAWLERS LTD

JUDGEMENT

(1.) The appellants were charterers of a steam trawler the St. Cuthbert which was the property of the respondents. The charter party, dated 25 October 1928, had originally been entered into between the respondents and the National Fish Company, Ltd., but was later by agreement taken over by the appellants. It was for 12 calendar months, but was to continue from year to year unless, terminated by 3 months' notice from either party, the notice to take effect at the end of one of the years. It was expressly agreed that the trawler should be employed in the fishing industry only; the amount of monthly hire was to be fixed on a basis to include a percentage of the purchase price, and also operating expenses. There was an option given to the charterers to purchase the trawler. By letters dated 6 and 8 July 1932, exchanged between the appellants and respondents, it was agreed that the charter party as then existing should be renewed for one year from 25 October 1932, but at a rate of monthly hire which was 25 per cent. lower than that previously paid: the amount so agreed came to $590.97 per month. It was also then agreed that in the event of the appellants giving notice on or before 25 July in any year that they did not intend to renew, they should further give notice whether or not they intended to exercise the option to purchase. In fact the appellants gave notice on 27 January 1933, that they did not intend to renew the charter or to purchase the vessel.

(2.) When the parties entered into the new agreement in July 1932, they were well aware of certain legislation consisting of an amendment of the Fisheries Act (c. 73 Revised Statutes of Canada, 1927) by the addition of S. 69-A, which in substance made it a punishable offence to leave or depart from any port in Canada with intent to fish with a vessel that uses an otter or other similar trawl for catching fish, except under license from the Minister : it was left to the Minister to determine the number of such vessels eligible to be licensed, and Regulations were to be made defining the conditions in respect of licences. The date of this amending S. 69-A was 14 June 1929. Regulations were published on 14 August 1931, former Regulations having been declared invalid in an action in which the appellants had challenged their validity.

(3.) The St. Cuthbert was a vessel which was fitted with, and could only operate as a trawler with an otter trawl. The appellants, in addition to the St. Cuthbert, also operated four other trawlers, all fitted with otter trawling gear. On 11 March 1933, the appellants applied to the Minister of Fisheries for licences for the trawlers they were operating, and in so doing complied with all the requirements of the Regulations, but on 5 April 1933, the Acting Minister replied that it had been decided (as had shortly before been announced in the House of Commons) that licences were only to be granted to three of the five trawlers operated by the appellants: he accordingly requested the appellants to advise the Department for which three of the five trawlers they desired to have licences. The appellants thereupon gave the names of three trawlers other than the St. Cuthbert, and for these three trawlers licences were issued, but no licence was granted for the St. Cuthbert. In consequence, as from 30 April 1933, it was no longer lawful for the appellants to employ the St. Cuthbert as a trawler in their business. On 1 May 1933, the appellants gave notice that the St. Cuthbert was available for re-delivery to the respondents; they claimed they were no longer bound by the charter.