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Canada Steamship Lines v The King

Canada Steamship Lines v The King [1952] AC 192

Summary: Exclusion clauses, ambiguity in contractual clauses


Canada Steamship Lines entered into a Crown lease in 1940. The Duration of the lease was for 12 years and the lease pertained to dock property on St Gabriel Basin on the Lachine Canal. All of this was situated in the Port of Montreal. Pursuant to the Crown lease, Canada Steamship Lines became the tenant there. The property included a freight shed. The lease contained an exclusion clause which related to that shed, specifically stating that the Claimant would not have any claim for damage to goods which were stored in the shed. Nevertheless, under the lease the Defendant had the duty of maintaining the shed including bearing the costs of so doing. In the process of maintaining the shed, an employee used an oxy-acetylene torch (which was improper and negligent practice) and accidently set some cotton bales on fire, with that fire spreading and eventually burning down the entire shed. This caused significant damage, including $40,714 worth of damage to the Claimant. The Claimant wished to sue the Defendant, but the Defendant asserted that no liability existed due to the exclusion clause.


The issue in this case was whether the exclusion clause could be construed to exclude liability on the facts of the case.


It was held that the exclusion clause, as well as a different indemnity clause, were both ambiguous. In that situation, they would be interpreted in favour of the Claimant. In fact, the issue of negligence may be irrelevant, as strict liability could apply due to the Defendant’s failure to keep the shed in good repair. The following test was set out:

“(1) If the clause contains language which expressly exempts the person in whose favour it is made (hereafter called the `the proferens’) from the consequences of his own servants, effect must be given to that provision (2) If there is no express reference to negligence, the court must consider whether the words used are wide enough, in their ordinary meaning, to cover negligence on the part of the servants of the proferens (3) If the words used are wide enough for the above purpose, the court must then consider whether `the head of damage may be based on some ground other than negligence”
– (Lord Morton of Henryton)

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Answering problem questions in the University of London LLB programme requires a clear understanding of legal principles, good analytical skills and the ability to apply the law to a given set of facts. Here are some tips to help you answer problem questions effectively:

  1. Read the question carefully: Make sure you understand what the question is asking before you begin writing.
  2. Identify the legal issues: Identify the legal issues raised by the facts and the relevant laws that apply to those issues.
  3. Analyze the facts: Analyze the facts presented in the question, focusing on the details that are relevant to the legal issues.
  4. Apply the law: Apply the relevant laws to the facts, making sure to consider all relevant legal principles and cases.
  5. Structure your answer: Use a clear and well-structured approach, starting with an introduction that outlines the main legal issues, followed by a discussion of the relevant laws and a conclusion that summarizes your analysis and sets out your conclusion.
  6. Use relevant cases and statutes: Cite relevant cases and statutes to support your analysis and help illustrate the legal principles you are discussing.
  7. Be concise: Be concise and to the point, focusing on the key issues and avoiding unnecessary detail.
  8. Proofread: Proofread your answer carefully to make sure it is error-free and clear.
  9. Time management: Make sure you manage your time effectively, leaving enough time to review your answer and make any necessary corrections.

By following these tips, you should be able to answer problem questions in the University of London LLB programme effectively and with confidence. Good luck!

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