Scottish Court of Session Decisions

The Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58), sec. 13, enacts—“‘Workman’ does not include any person employed otherwise than by way of manual labour whose remuneration exceeds two huudred and fifty pounds a-year … but save as aforesaid means any person who has entered into or works under a contract of service or apprenticeship with an employer, whether by way of manual labour, clerical work, or otherwise, and whether the contract is expressed or implied, is oral or in writing,”

In an arbitration in the Sheriff Court at Kirkcudbright under the Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58), between Mrs Robertina Fleming or Sharpe, widow of William M. Sharpe, master mariner, Kippford, Kirkcudbrightshire, and Mrs Janet Aitken or Sharpe, his mother, pursuers and respondents, and John Carswell, merchant, Dalbeattie, managing owner of the sailing schooner “Dolphin,” defender and appellant, the Sheriff-Substitute ( Napier) found the pursuers entitled to compensation, and at the request of the defender stated a case for appeal.

The following facts were found proved or admitted—“(1) The appellant admits—( a) that the respondents are the sole dependants of the late William Martin Sharpe, and were wholly dependent upon his earnings; ( b) that William Martin Sharpe had for fully seven years prior to his death acted as master of the schooner ‘Dolphin,’ and that his earnings during the three years preceding his death amounted to £234, 16s.; ( c) that Sharpe died in Liverpool on 7th January 1909, as the result of injuries sustained by him on board the ‘Dolphin’ the previous day, and while acting in the course of his employment as master thereof. (2) That the appellant was the managing owner of the ‘Dolphin,’ and as such managing owner, and on behalf of the part-owners, he employed Sharpe to act as master of that vessel. (3) That Sharpe owned ten sixty-fourth shares of the ‘Dolphin,’ and that the appellant, who owned thirty-three shares, and one other person, namely, John Tait, master mariner, Kippford, who owned twenty-one shares, were the other part-owners. (4) That the ‘Dolphin’ was not ‘hired out,’ that is, was not chartered, but was employed generally in carrying cargoes between Dalbeattie and Liverpool. The appellant generally found the cargo for the voyage from Liverpool to Dalbeattie, which was usually consigned to him for the purpose of the business of grain merchant and miller which he carried on at Dalbeattie, and Sharpe generally found the cargo for the voyage from Dalbeattie to Liverpool. … (6) That Sharpe performed all the duties and had all the powers of a master of such a vessel as the ‘Dolphin’; that he received a fixed remuneration for his services as master; that in addition thereto, that he, the appellant, and Tait shared the profits and bore the losses made by the ‘Dolphin’ in proportion to the respective shares which they held

On these facts the Sheriff held that Sharpe was simply a part-owner and master of the ‘Dolphin,’ and that Sharpe was not a partner of nor did he enter into a joint-adventure in a course of trading carried on by means of the “Dolphin” with the

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appellant, nor with the appellant and Captain Tait. He therefore held that the respondents were entitled to compensation.

The questions of law for the opinion of the Court were—“(1) Whether the deceased William Martin Sharpe at the time of his death was a workman in the employment of the appellant within the meaning of the Workmen's Compensation Act 1906? (2) Does the fact that Sharpe was a part-owner of the ‘Dolphin’ debar the respondents from claiming compensation from the appellant? (3) Whether Sharpe at the time of his death was ( a) a partner of, or ( b) a joint-adventurer, with the appellant, or with the appellant and Captain Tait, in a course of trading carried on by means of the ‘Dolphin’?”

Argued for the appellant—The relation between the deceased and the other co-owners was one of partnership, and if there was partnership, then there could be no liability. Partnership might not follow from joint-ownership, but from the facts found in this case it did. There were two criteria of partnership — (1) sharing of profits, (2) mutual agency—Partnership Act 1890 (53 and 54 Vict. cap. 39), sec. 2; Cox v. Hickman, 1860, 8 Clark (H.L.) 268; Stewart v. Buchanan, October 23, 1903, 6 F. 15, 41 S.L.R. 11. Both these criteria existed here. The fact that deceased supplied the cargo at the home port supported this contention, because the authority of the captain, as captain, to get necessaries depended on his being away from the home port—Carver on Carriage by Sea (4th ed.), p. 48; Abbot on Merchant Ships and Seamen (14th ed.), p. 159; “ The Fanny,” 1883, 5 Asp, M.C. 75, per Lord Esher, M.R. Joint-adventure was in the same position as partnership. But if there was partnership there was no liability— Ellis v. Ellis & Company, [1905] 1 KB 324. The case of Ellis was decided under the Act of 1897 (60 and 61 Vict. cap. 37), but the terms of the Act of 1906 were even more favourable to the appellant's view—Workmen's Compensation Act 1897, secs. 1 and 7; Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58), secs. 1 and 13. This, however, would not apply to workmen profit-sharing— Clark v. G. R. & W. Jamieson, 1909 SC 132, 46 S.L.R. 73, and Gill v. Aberdeen Steam Trawling and Fishing Company, Limited, 1908 S.C. 328, 45 S.L.R. 247. Gorman v. Gibson & Company, December 2, 1909, not yet reported— v. infra. There the employee was not a partner. The appellant acted as agent for disclosed principals—the registered owners of the ship—and they were the real employers—Bell's Principles (10th ed.), 224A; M'Donald v. Owners of “Banana” [1908], 2 K.B. 926. There was here really no contract of employer and employed, but merely an arrangement as to the duties of the partner.

Argued for the respondent—Section 7 of the Act of 1906 brought within the scope of the Act masters and seamen if workmen. This led to the definition of “workman” in section 13, and the facts found by the Sheriff-Substitute agreed with that definition. Gorman v. Gibson & Company, cit. sup., was an authority for the proposition that where there is a contract of employment made by the managing owner the managing owner is liable. But even if there was a partnership the claim for compensation was not barred. The ratio decidendi of Ellis, cit. sup., did not apply to Scotland, because in England a firm had no separate persona, whereas in Scotland it had—Partnership Act 1890, sec. 4 (2). A partnership in Scotland therefore was in the same position as a limited company in England, and in Ellis, Collins, M.R., recognised that there would in the latter case have been a claim.