S/S Steamship Co. v. Eastern Caribbean Container Line S.A., (1986) 66 N.R. 74 (FCA)

• Judge: Pratte, Hugessen and LaCombe, JJ.
• Court: Federal Court of Appeal (Canada)
• Case Date: February 26, 1986
• Jurisdiction: Canada (Federal)
• Citations: (1986), 66 N.R. 74 (FCA)

S/S Steamship v. Caribbean Container (1986), 66 N.R. 74 (FCA)

MLB headnote and full text

S/S Steamship Company Ltd. v. Eastern Caribbean Container Line S.A.

(A-650-85)

Indexed As: S/S Steamship Co. v. Eastern Caribbean Container Line S.A.

Federal Court of Appeal

Pratte, Hugessen and LaCombe, JJ.

February 26, 1986.

Summary:

A creditor obtained judgment against a carrier and applied for a garnishee order respecting a debt for freight owed to the carrier by a shipper. The shipper resisted the application on the ground that it had a claim against the carrier for damages for delay in excess of its debt for freight.

The Federal Court of Canada, Trial Division, dismissed the application on the grounds that the shipper was entitled to set off its damages claim against the freight debt and that, where the carrier's solvency was in doubt, to issue a garnishee order would create a preference in favour of the judgment creditor. The judgment creditor appealed.

The Federal Court of Appeal held that the garnishee order should have been ordered. The court held that a claim for damages for delay may not be set off against a carrier's claim for freight. The court held that where the carrier was not bankrupt, there was no reason to deny the creditor a garnishee order.

Creditors and Debtors - Topic 4307

Garnishment by creditor - Garnishee order and priorities - Priority of garnishor over other creditors - A trial court denied a judgment creditor a garnishee order on the ground that the debtor's solvency was in doubt and to issue the garnishee order would create a preference in favour of the judgment creditor - The Federal Court of Appeal held that, where the debtor was not bankrupt, there was no reason to deny the creditor a garnishee order - See paragraph 8.

Creditors and Debtors - Topic 4444

Garnishment by creditor - Defences - Set-off by garnishee to debtor - A judgment creditor of a carrier applied for a garnishee order respecting a debt for freight owed to the carrier by a shipper - The shipper resisted the application on the ground that it had a claim against the carrier for damages for delay in excess of its debt for freight -The Federal Court of Appeal held that the garnishee order should issue and that a claim for damages for delay may not be set off against a carriers claim for freight - See paragraphs 5 to 7.

Shipping and Navigation - Topic 2225

Carriage of goods - Damages for delay - Set-off - The Federal Court of Appeal held that a claim against a carrier for damages for delay in delivery may not be set off against the carrier's claim for freight - See paragraphs 5 to 7.

Cases Noticed:

Meyer v. Dresser (1864), 33 (Part II) Law Journal Common Law (N.S.) 289, refd to. [para. 6].

The Brede, [1973] 2 Ll. R. 333 (eng. C.A.), refd to. [para. 6].

Aries Tanker Corp. v. Total Transport, [1977] 1 Ll. R. 334 (H.L.), refd to. [para. 6].

A.S. Gunnstein v. Jensen, [1977] 2 Ll. R. 434 (C.A.), refd to. [para. 6].

B.C. Marine Shipbuilders Ltd. and Stuarts Towing Ltd. v. F.M. Yorke and Son Limited and Wire Rope Industries of Canada, [1981] 1 S.C.R. 363; 35 N.R. 288, refd to. [para. 6].

Sivaco Wire & Nail Co. et al. v. Tropwood A.G. et al., [1979] 2 S.C.R. 1054; 26 N.R. 313, refd to. [para. 6].

Gaherty v. Torrance et al. (1862), 6 Lower Canada Jurist 313 (Q.B), refd to. [para. 6].

Halcrow v. Le mesurier (1884), 10 Quebec L.R. 239 (Q.B.), refd to. [para. 6].

Spindler et al. v. Farquar (19051906), 38 N.S.R. 183 (C.A.), refd to. [para. 6].

Insurance Co. of North America v. Colonial Steamship Limited, [1942] Ex. C.R. 79, refd to. [para. 6].

Kaps Transport et al. v. McGregor Telephone and Power Construction Co. Ltd. (1971), 13 D.L.R.(3d) 732, refd to. [para. 6].

St. Lawrence Construction v. Federal Commerce and Navigation Co. Ltd. (1985), 56 N.R. 174 (F.C.A.), refd to. [para. 6].

Authors and Works Noticed:

Halsbury's Laws of England (4th Ed.), vol. 42, paras. 411-416 [para. 5].

Counsel:

Gerald P. Barry, for the appellant;

Martine Tremblay, for the respondent.

Solicitors of Record:

Barry & Associates, Montreal, Quebec, for the appellant;

Harris, Allain, Thomas Mason, Montreal, Quebec, for the respondent.

This case was heard on February 25 and 26 1986, at Montreal, Quebec, before Pratte, Hugessen and LaCombe, JJ., of the Federal Court of Appeal.

On February 26, 1986, Pratte, J., orally delivered the following judgment for the Federal Court of Appeal: