Related topics

Contract, Liabilities for Breach

Deviation Justified

Deviation, Permissible Limits of

‘Liberty to Call’ Clause

Ordinary Sea Route (Track)


Law and Sea.

William S. Holdsworth, in his book "A history of English law" traced the first successful insurer’s defence on the ground of deviation back to 1547 when the oldest known suit in Admiralty in case of Broke v Maynard took place. Same author names the common law case Green v Young (1702) 2 Salk. 444 as one of the earliest case law authorities concluding that deviation was fatal to the policy, but that for a loss occurring before the deviation the insured could recover.
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Deviation
Last updated: 28-Nov-2015

In Clayton v Simmonds (1741) 1 Burr. 343 it was held by Lee CJ that:

…if a ship puts into a port, not usual, or stays au unusual time, it is deviation.

Per Lord Mansfield in Lavabre v Wilson (1779) 1 Dougl. 284 at p.291:

A deviation from necessity must be justified both as to substance and manner. Nothing more must be done than what the necessity requires. The true objection to a deviation is not increase of the risk. If that were so it would only be necessary to give an additional premium. It is that the party contracting has voluntarily substituted another voyage for that which has been insured.

Leduc & Co v Ward (1888) 20 QBD 475 per Lord Esher M.R. at p.482:

If the  stipulation  were  only  that  she   might  call   at  any  ports,  the   invariable construction   has   been  that  she  would   only  be  entitled  to  call   at  such   ports   in  their geographical order; and therefore the words "in any order" are frequently added, but in any case it appears to me that the ports must be ports substantially on the course of the voyage. It follows that, when the defendants’ ship went off the ordinary track of a voyage from Fiume to Dunkirk to a port not on the course of that voyage, such as Glasgow, there was a deviation, and she was then on a voyage different from that contracted for to which the excepted perils clause did not apply; and therefore the shipowners are responsible for the loss of the goods.

Phelps, James & Co v Hill [1891] 1 QB 605, per Lopes LJ at p.613:

The shipowner through his master is bound to act with prudence and skill and care in avoiding dangers and in mitigating the consequences of any disaster which may have happened. The master is bound to take into account the interests of the cargo-owners as well as those of the shipowner. He must act prudently and concerned. So strict is the rule with regard to deviation that, while the master may deviate save life, he may not deviate to save property.

Fletcher Moulton LJ in Joseph Thorley Ltd v Orchis Steamship Co.Ltd [1907] 1 KB 660 at p.669 defined deviation as ‘something fundamentally different’ introducing characteristic ‘fundamental’ into descriptions of deviation and fundamental breach:

The cases shew that, for a long series of years, the Courts have held that a deviation is such a serious matter, and changes the character of the contemplated voyage so essentially, that a shipowner who has been guilty of a deviation cannot be considered as having performed his part of the bill of lading contract, but something fundamentally different, and therefore he cannot claim the benefit of stipulations in his favour contained in the bill lading. In what position, then, does he stand? He has carried the goods to their place destination, and is therefore entitled to some remuneration for that service, of which their owner has received the benefit. The most favourable position which he can claim to occupy that he has carried the goods as a common carrier for the agreed freight. I do not say that in all circumstances he would be entitled as of right to be treated even as favourably as this, but in the present case the plaintiffs do not contest his right to stand in that position. That, however, still leaves him liable to the plaintiffs for the amount which they have recovered in this action.

And per Collins M.R. at pp.610-611:

The principle … seems to be that the undertaking not to deviate has the effect of a condition, or a warranty in the sense in which the word is used in speaking of the warranty of seaworthiness, and, condition is not complied with, the failure to comply with it displaces the contract. It goes to the root of the contract, and its performance is a condition precedent to the right of the shipowner to put the contract in suit. It may be, no doubt, that, although that condition broken, the circumstances are such as to give rise to an implied obligation on the part of the cargo owner to pay the shipowner the freight, and, it may be, to perform other stipulations which may be implied under the circumstances from the fact of the carriage of the cargo to its destination; but that is quite consistent with the effect of the deviation being to displace the special contract expressed in the bill of lading.

… the Court regarded the deviation as amounting to failure to comply with condition   precedent, and therefore as displacing the express contract, independently of question whether the deviation had any bearing on the particular loss complained of by the cargo owners. If that be the true principle, it is applicable, as it appears to me, to the present case. There is no connection, it is true, between the deviation and the particular negligence which in this case occasioned the loss, but that is quite immaterial if the principle underlying the decision in Balian v Joly, Victoria & Co. applies, namely, that the shipowner cannot set up the exception clause in the bill of lading contract, which only exists for his benefit,  if he has performed a condition precedent upon which his right to rely on that contract depends.

Per Roche J in Rio Tinto v Seed Shipping (1926) 24 LIL Rep 316:

The essence of deviation [is] that the parties contracting have voluntarily substituted another voyage for that which has been insured. A mere departure or failure to follow the contract voyage or route is not necessarily a deviation, or every stranding which occurred in the course of a voyage would be a deviation, because the voyage contracted for, I imagine, is in no case one which essentially involves the necessity of stranding. It is a change of voyage, a radical breach of the contract, that is required to, and essentially does, constitute a deviation …

Here I am satisfied, and I find as a fact, that the master never intended to leave the route of the voyage, that is to say, the route of the voyage from Glasgow to Huelva.What he did was to make a mistake as to the compass course which was necessary to take him from the terminus a quo to the terminus ad quem. To use an analogy which, although analogies are misleading, I think at this stage is in order, he did not adopt another road instead of the road that he had agreed to take, but he got himself into the ditch at the side of the road which he was intending to follow. He was not on another route; he was on the existing route, although he was out of the proper part of the route which he ought to have followed.

Lord Parmoor in Cunard Steamship Co Ltd v Buerger [1926] All ER Rep 103 said at p.106:

It is a well-established principle that stipulations in a contract of carriage limiting or negativing the liability of carriers, by land or water, for loss of or damage to goods entrusted to them for carriage do not apply when such loss or damage has occurred outside the route or voyage contemplated by the parties when they entered into the contract of carriage, unless the intention that such limitations should apply is expressed in clear and unambiguous language.

Hain Steamship Company Ltd v Tate & Lyle Ltd [1936] 2 All ER 597 per Lord Atkin, at page 601:

I venture to think that the true view is that the departure from the voyage contracted to be made is a breach by the shipowner of his contract, but a breach of such a serious character that however slight the deviation the other party to the contract is entitled to treat it as going to the root of the contract, and to declare himself as no longer bound by any of its terms….

The same view is taken in contracts of marine insurance where there is implied an absolute condition not to deviate. No doubt the extreme gravity attached to a deviation in contracts of carriage is justified by the fact that the insured cargo owner when the ship has deviated has become uninsured. It appears to me inevitable that a breach of contract which results in such momentous consequences well known to all concerned in commerce by sea should entitle the other party to refuse to be bound. It is true that the cargo owner may, though very improbably, be uninsured: it is also true that in these days it is not uncommon for marine insurers to hold the assured covered in case of deviation at a premium to be arranged. But these considerations do not appear to diminish the serious nature of the breach in all the circumstances of sea carriage; and may be balanced by the fact that the ship can, and often does, take liberties to deviate which prevent the result I have stated. If this view be correct then the breach by deviation does not automatically cancel the express contract, otherwise the shipowner by his own wrong can get rid of his own contract. Nor does it affect merely the exceptions clauses. This would make those clauses alone subject to a condition of no deviation, a construction for which I can find no justification. It is quite inconsistent with the cases which have treated deviation as precluding enforcement of demurrage provisions. The event falls within the ordinary law of contract. The party who is affected by the breach has the right to say, I am not now bound by the contract whether it is expressed in charterparty, bill of lading or otherwise. … I am satisfied that once he elects to treat the contract as at an end he is not bound by the promise to pay the agreed freight any more than by his other promises. But on the other hand, as he can elect to treat the contract as ended, so he can elect to treat the contract as subsisting: and if he does this with knowledge of his rights he must in accordance with the general law of contract be held bound.

In E. L. Oldendorff & Co. G.M.B.H. Appellants v. Tradax Export S.A. Respondents (The Johanna Oldendorf), [1974] AC 479 per Lord Diplock at p.556-557:

Charterparties originated at a period when contractual obligations were as a general rule treated as absolute. A party’s obligation was to secure that anything that he warranted should be done, was done. If it was not, then, unless this was the result of some default of the other party, he was liable in damages, even though circumstances over which he himself had no control and could not even have foreseen made it impossible for it to be done. In the case of maritime carriage this rule was subject to the exception that performance was excused if it were prevented by Act of God or of the King’s enemies or by inherent vice in the goods carried. At a very early date it became usual to incorporate in charter parties express exceptions for other maritime perils, and in modern charter parties these have been extended to strikes and other hindrances to performance which take place on land. But that the old rule still applies in the absence of an express exception in the charter party is shown by the fact that when there is deviation from the chartered voyage the ship owner’s liability for the safe delivery of the goods is absolute, save for the limited common law exceptions mentioned above.


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