Sewell v.

Burdick
Sewell v. Burdick
HOUSE OF LORDS (1884) 10 App. Cas. 74.
Shipowners sued the indorsees of a bill of lading for freight, arguing that liabilities had been transferred to
them under s. 1 of the 1855 Act. The indorsees were not party to the original contract of carriage, and had
taken the bills of lading only in security for a loan. They never took possession of or dealt with the goods.
The bills of lading were indorsed in blank.
Held:
The indorsees were not liable. The 1855 Act did not apply.
Notes:
1. The Earl of Selborne, L.C., was unwilling to extend the decision beyond its own facts, and thought (at
p. 83) that the result may have been different had the indorsement been personal, rather than in blank, or
(at p. 86) if the pledgee had taken delivery. But Lord Blackburn (at p. 93) doubted the validity of the first
distinction, and Atkin LJ in Brandt v. Liverpool thought Lord Selborne's second distinction wrong.
Scrutton LJ in the same case thought Lord Selborne must have been thinking of the earlier common law,
and indeed delivery can lead to a common law implied contract (as in Brandt v. Liverpool).
2. It is more likely that the case turns on the nature of a pledgee's property (e.g. Lord Fitzgerald at p. 106).
He does not obtain general property in the goods, merely a special property as pledgee. If so, the case also
applies to banks taking bills as security, where money is advanced on a commercial credit, however the
bill of lading is indorsed. Further, since the Act does not apply at all in this situation, neither liabilities nor
rights of suit are transferred, so banks cannot sue on the carriage contract either. Prior to the 1992 Act
they could therefore rely only on the principles discussed in Brandt v. Liverpool. This was a serious
limitation on the operation of the 1855 Act.
3. There are dicta, especially in the speech of Lord Bramwell (at p. 105), adopting a narrow and literal
interpretation of the Act. These dicta are further considered in The San Nicholas and The Sevonia Team.
They should be treated with caution because they go much further than necessary for the decision, and are
not supported by the other speeches. This debate is in any case now largely academic since the 1855 Act
was repealed in 1992.
4. The modern day importance of the case is that in spite of Lickbarrow v. Mason, transfer of the bill of
lading does not necessarily transfer the general property in the goods.
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