Wire Rope Industries of Canada (1966) Ltd. v. B.C. Marine Shipbuilders Ltd. et al.

Wire Rope Industries of Canada (1966) Ltd. v. B.C. Marine Shipbuilders Ltd. et al.
Collection
Supreme Court Judgments
Date
1981-03-19
Report
[1981] 1 SCR 363
Judges
Martland, Ronald; Ritchie, Roland Almon; Dickson, Robert George Brian; Beetz, Jean; Estey, Willard Zebedee; McIntyre, William Rogers; Chouinard, Julien
On appeal from
Federal Court of Appeal
Subjects
Courts
Maritime law
Decision Content
Supreme Court of Canada
Wire Rope Industries of Canada (1966) Ltd. v. B.C. Marine Shipbuilders Ltd. et al., [1981] 1 S.C.R. 363
Date: 1981-03-19
Wire Rope Industries of Canada (1966) Ltd. (Third Party) Appellant;
and
B.C. Marine Shipbuilders Ltd. and Straits Towing Ltd. (Plaintiffs) Respondents;
and
F.M. Yorke & Son Limited (Defendant) Respondent;
and
Wire Rope Industries of Canada (1966) Ltd. (Defendant) Appellant;
and
B.C. Marine Shipbuilders Ltd. and Straits Towing Ltd. (Plaintiffs) Respondents.
1980: March 11, 12, April 23, 24; 1981: March 19.
Present: Martland, Ritchie, Dickson, Beetz, Estey, McIntyre and Chouinard JJ.
ON APPEAL FROM THE FEDERAL COURT OF APPEAL
Courts—Jurisdiction—Federal Court of Canada—Trial Division—Canadian maritime law—Third party proceedings, while related to action in maritime law, based in tort and contract—Whether or not jurisdiction to entertain third party proceeding—British North America Act, s. 91.10—Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, ss. 2, 22(1), (2), 42—The Admiralty Act, 1891, 1891 (Can.), c. 29, ss. 3, 4—An Act to improve the Practice and extend the Jurisdiction of the High Court of Admiralty of England, 1840 (U.K.), c. 65, s. 6—The Admiralty Act, 1934, 1934 (Can.), c. 31—Colonial Courts of Admiralty Act, 1890, 1890 (U.K.), c. 27.
Maritime law—Barge lost at sea—Towline socket failure—Socket resocketed under contract—Tug’s contract requiring seaworthiness at outset of voyage—No liability of due diligence proved—Whether or not tug owner liable—Whether or not third party liable to indemnify other parties for loss of third party negligent in resocketing process. These appeals raised questions of liability for loss at sea of a log barge, owned by the respondent B.C. Marine Shipbuilders Ltd. and chartered to Straits Towing Ltd., while the barge was being towed by the Lorne Yorke, a tug owned by F.M.Yorke & Son Limited. Pursuant to the contract with the tug owner the ship had to be seaworthy at the outset of the voyage, and if it were otherwise, the burden lay on the tug owner to prove due diligence with respect to seaworthiness. The loss occurred because of the failure of a manganese steel socket that formed part of the towline between the tug and the barge. The socket had been resocketed—a process by which a socket was reattached to the wire rope or cable—and because the process had been performed by Wire Rope, that company was joined in the action as a third party. Claims were made by the owner and the charterer of the barge against the tug’s owner; claims for indemnity were made against Wire Rope; as well, the jurisdiction of the Federal Court of Canada to deal with the third party claim was in issue.
At trial, judgment was ordered against Yorke in favour of Straits and B.C. Marine, and a reference directed. The actions against Wire Rope were dismissed. The Court of Appeal allowed Yorke’s appeal from the judgment in favour of B.C. Marine but dismissed its appeal from judgment in favour of Straits. The third party claim by Yorke and the appeals by B.C. Marine and Straits against Wire Rope succeeded, rendering Yorke liable for the barge’s loss with right of indemnity against Wire Rope and making Wire Rope liable to B.C. Marine and Straits for their losses. In this Court, Wire Rope appealed and sought the restoration of the trial judgment. B.C. Marine and Straits sought dismissal of the appeal made by Wire Rope and Yorke, and B.C. Marine also sought a reversal of the Court of Appeal’s dismissal of its action against Yorke. Yorke cross-appealed the judgment made against it in favour of Straits, and alternatively, sought an order for indemnification against Wire Rope for damages and costs for which it could be held liable.
Held: The appeals of Wire Rope against the judgments in favour of B.C. Marine, Straits and Yorke should be allowed and the part of the trial judgment dismissing the actions against Wire Rope restored; the cross-appeal by Yorke should be allowed; the action by B.C. Marine and Straits against Yorke should be dismissed; and the cross-appeal of B.C. Marine and Straits should be dismissed.
The Federal Court had jurisdiction to deal with the claims made against Wire Rope. Those claims alleged breach of contract and negligence in the resocketing of the main towing cable which formed part of the equipment of the Lorne Yorke. The claims made against Wire Rope were encompassed within the meaning of “Canadian maritime law” as used in the Federal Court Act. Jurisdiction broad enough to include these claims had been granted the British High Court of Admiralty, and had been transmitted through a succession of courts to the Federal Court. In addition, the substantive law relating to the claims fell within federal legislative competence under s. 91.10 of the British North America Act. There was therefore law of Canada relating to the issues upon which the Federal Court could operate. It was of no significance that Yorke’s claim was one for indemnity. Claims for indemnity and third party actions, generally, are not mere incidents to the principal action but are independent, standing on their own feet.
The appeals against Wire Rope were dismissed for it could not be shown that its work on the socket caused or contributed to the socket’s failure leading to the loss of the barge. There was evidence to support the conclusion that resocketing did not significantly embrittle the socket and cause its failure. Any claim that the defect was caused by an indefinite number of resocketings could not be sustained for no affirmative evidence was adduced to establish more than one socketing and resocketing. As the resocketing did not cause the socket’s failure, no liability could fall on Wire Rope.
Yorke was not liable in the main action brought by B.C. Marine and Straits for the loss of the barge. Any implied warranty respecting the ability of the crew, tackle and equipment at the outset of the voyage to meet the circumstances reasonably expected, was replaced by the inclusion of specific provisions in the contract between Yorke and Straits. Yorke was liable to B.C. Marine or Straits only if the Lorne Yorke, because of a failure by Yorke to exercise due diligence, was not seaworthy when it put out on the voyage that led to the accident, and if the loss was caused by lack of seaworthiness. Yorke successfully met the burden of showing that the socket’s failure was caused by a latent defect. The exercise of due diligence would not have revealed the defect. Even if the socket had had no latent defect, there was evidence that the manganese steel socket could be safely resocketed and that the practice of re-using sockets after resocketing was regularly followed in the industry with no apparent ill-effects. The state of the socket at the outset of the voyage was not such as to make the vessel unseaworthy and so render Yorke liable pursuant to the contract. There was no evidence of loss being caused by faulty navigation or seamanship.
R. v. Thomas Fuller Construction Co. (1958) Limited and Foundation Company of Canada Limited, [1980] 1 S.C.R. 695, distinguished; Tropwood A.G. and the Owners of the Vessel Tropwood v. Sivaco Wire & Nail Company and Atlantic Lines & Navigation Company, Inc., [1979] 2 S.C.R. 157; Quebec North Shore Paper Company et al. v. Canadian Pacific Limited, et al., [1977] 2 S.C.R. 1054; McNamara Construction (Western) Limited et al. v. The Queen, [1977] 2 S.C.R. 654; Bank of Montreal v. Royal Bank of Canada, [1933] S.C.R. 311; Charles Goodfellow Lumber Sales Limited v. Borromée Verreault, Captain Fernand Hovington and Verreault Navigation Inc., [1971] S.C.R. 522, applied; Maxine Footwear Company Ltd. et al. v. Canadian Government Merchant Marine Ltd., [1957] S.C.R. 801; Western Canada Steamship Company Limited v. Canadian Commercial Corporation and Others, [1960] S.C.R. 632; Riverstone Meat Co. Pty. Ltd. v. Lancashire Shipping Co. Ltd., (“Muncaster Castle”), [1961] A.C. 807; Toronto Elevators Limited v. Colonial Steamship Limited, [1950] Ex. C.R. 371; Robin Hood Flour Mills Limited v. N. M. Paterson & Sons Limited, [1967] 1 Ex. C.R. 431, aff’d [1968] 1 Ex. C.R. 175, referred to; Scottish Metropolitan Assurance Company, Limited v. Canada Steamship Lines, Limited, [1930] S.C.R. 262; The “Dimitrios N. Rallias” (1922), 13 L1. L.R. 363, considered.
APPEALS AND CROSS-APPEALS from decisions of the Federal Court of Appeal[1], allowing the appeals from and varying the judgments of Gibson J. Appeals by Wire Rope against the judgments in favour of B.C. Marine, Straits, and Yorke allowed, and that part of the judgment at trial dismissing the actions against Wire Rope restored; cross-appeal by Yorke allowed; the action by B.C. Marine and Straits against Yorke dismissed; and the cross‑appeal of B.C. Marine and Straits dismissed.
D. Brander Smith and N. Daugulis, for the appellant.
W. O’M. Forbes, for the respondents B.C. Marine Shipbuilders Ltd. and Straits Towing Ltd.
J.R. Cunningham, for the respondent F.M. Yorke & Son Limited.
The judgment of the Court was delivered by
MCINTYRE J.—These appeals raise questions of liability for the loss at sea of a log barge owned by the respondent B.C. Marine Shipbuilders Ltd. Claims were made by the owners and charterers of the lost barge against the owners of the tug engaged to tow it; claims for indemnity were also made against a company which had performed certain services for the tug; as well the jurisdiction of the Federal Court of Canada to deal with the third party claim for indemnity was in issue.
The respondents B.C. Marine Shipbuilders Ltd. (B.C. Marine) and Straits Towing Ltd. (Straits) commenced these proceedings in the Federal Court against F.M. Yorke & Son Limited (Yorke) claiming damages for breach of a contract of towage and for negligence resulting in the loss of their barge, the Westport Straits. The breach alleged was that Yorke had failed to furnish a seaworthy tug. By the order of Mr. Justice Sheppard, dated January 7, 1970, Yorke issued a third party notice directed to Wire Rope Industries of Canada (1966) Ltd. (Wire Rope) and later filed a statement of claim for indemnity for any damages for which it might become liable to the respondents. Yorke alleged negligence on the part of Wire Rope in the resocketing of a cable used in towing the Westport Straits, a process I will describe later, and breach of an implied warranty of fitness of its work. On January 5, 1973 Collier J. gave leave to B.C. Marine and Straits to add Wire Rope as a defendant, and in their amended statement of claim they claimed negligence in the resocketing process and resultant damages against Wire Rope.
Yorke denied negligence and denied breach of any implied term of seaworthiness of the tug and its towing gear. It asserted that it had exercised due diligence in furnishing a seaworthy vessel. In its statement of defence and counterclaim, Yorke said that if any negligence was involved in connection with the towing and loss of the Westport Straits it was attributable to the negligence of one Tobiasen, the mate of the tug, who was an employee of Straits and who had been placed as mate upon the tug by agreement with Yorke. Wire Rope denied negligence in the resocketing and also denied any implied or express warranty as to the quality of its work.
The plaintiff B.C. Marine owned the Westport Straits. By demise charter it chartered the barge to its co-plaintiff Straits. It was to be used to haul logs between Vancouver and a port, or ports, on the westerly coast of Vancouver Island. Straits, in turn, had chartered the tug Lorne Yorke from Yorke. It then engaged Yorke to tow the Westport Straits from Vancouver to a port on Kyuquot Sound on the west coast of Vancouver Island and there to pick up a load of logs and return them to Vancouver. Yorke picked up the barge at Vancouver and commenced to tow it to its destination.
The voyage involved passing through the Straits of Juan de Fuca and proceeding along the west coast of Vancouver Island to the entry to Kyuquot Channel where it was necessary to turn to starboard and pass into the channel and proceed to the destination which was known as Fair Harbour farther up the channel. The weather conditions were bad and on the night of January 31, 1968, while en route to Fair Harbour, the tug had been forced by weather to turn back from the westerly end of the Straits of Juan de Fuca and remain in the shelter of the straits for several hours. By the morning of February 1, the master of the Lorne Yorke elected to proceed with the voyage. He continued along the west coast of Vancouver Island towards Kyuquot Sound. At midnight on February 1 he turned over the watch to the mate Tobiasen, and went to bed. At about 0200 hours on February 2 Tobiasen reduced speed to cut down the ‘surging’ effect of the movement of tug and barge on the towline. This had the effect of allowing the towline to sink to the bottom and drag. At about 0245 hours while entering Kyuquot Channel the tug encountered a squall with sleet and snow and strong gusting winds from east-south-east. At this time the towline had been extended to about 2,000 feet. Tobiasen found that the tug was being moved to port, toward the northerly shore of the channel and, as he ordered a change of course to starboard, the towline became snagged on the bottom and the tug would no longer answer to its helm. In these conditions of weather and sea both tug and tow were placed in extreme hazard. The master was called after speed had been reduced to reduce pressure on the towline. The master came to the wheelhouse at once. He ordered the dropping of the towing pins—devices used to guide the towlines straight over the stern of the tug—for the purpose of making it possible to drive the tug hard to starboard, which he did, while at the same time going to full power in an attempt to jerk the towline free. The towline parted and, as a result, the barge Westport Straits was driven ashore and became a total loss.
The towline in use was in three connected sections. The principal section described as the main towline extended from the tug about 1,300 feet where it joined the second section or pennant which was some 350 to 400 feet in length and it, in turn, joined the third section which was of similar length and attached to the barge. The connections between the main towline and the first pennant, and between the two pennants, were effected by the use of sockets at the end of each section of cable, joined by links to the opposite sides of a steel tag plate. The sockets were made of steel. They were provided with an eye through which the link of the tag plate passed and were attached to the end of the towline by a process called socketing. Drawings illustrating the triple towing gear involved in this appeal appear below. Figure ‘A’ illustrates the linkage involved where three barges are towed at once. Figure ‘B’ illustrates the method of towing employed by Yorke on the date of the loss of the barge and, as well, gives an idea of the relative positions of tug, tow, and towline at the time the line failed. Figure ‘C’ shows the method of linkage from pennant to pennant, and figure ‘D’ provides a rough sketch showing the broken socket. It was the socketing of the main towline which brought Wire Rope into this action.
When the broken towline, or what remained of it, was taken aboard the Lorne Yorke it was observed that the break in the line had occurred at the main towline socket. The socket itself had broken and allowed the link to the adjoining pennant to escape. The line itself remained intact. Marks about fifty feet from the socket indicated where the towline had apparently been caught on the rocks. It was alleged against Wire Rope that the socket failed because it had been damaged and weakened by the negligence of Wire Rope in resocketing the towline. Wire Rope had performed this service for Yorke on October 13, 1967. Much of the evidence at trial was concerned with this issue. The process of socketing must be understood.
The sockets in use by Yorke at the time of the accident were made of manganese steel. This steel is particularly suited for this function, being very strong, ductile, and having great tensile strength. During the manufacturing process of manganese steel sockets the steel is heated to a temperature of some 1,950° F. and then quenched, or cooled very quickly, in cold water. The sudden cooling prevents the precipitation in the steel of undesirable carbides which, if present, would have the effect of making or tending to make the steel brittle, and thus subject to failure and unsuitable for use in this type of socket. After manufacture if it is necessary for any reason to heat the steel beyond 500° F. or 600° F. there is a danger that some embrittlement may result, depending upon the temperature reached and the time it is maintained, particularly if the heating is repeated frequently. To avoid this danger the steel should be reheated to 1,950° F. and quenched suddenly in cold water as above.
The type of socket in use in this case is used upon cable, commonly called wire rope. When put in use the socket is attached to the towline by running the end of the towline into the bottom of the socket so that it is enclosed by a collar or cylinder forming the base of the socket and called a basket. The wires of the cable end are loosened to give what is termed a ‘brushing’ effect and then molten zinc is poured into the base of the socket. When the zinc cools and hardens the end of the cable is securely retained in the socket.
From time to time for various reasons, including wear on the cable which frequently appears in the vicinity of the socket, it is necessary to remove the socket and to cut out any worn part of the line. If the socket is considered to be sound it can be resocketed and returned to use. The evidence indicated that re-use of sockets involving a consequent resocketing was common practice with York and other towing companies on the Pacific coast. To remove the socket it is necessary to heat the zinc in the socket to its melting point which was, according to the evidence, between 700° F. and 800° F. The molten zinc is then allowed to escape and the cable may be removed. The remaining zinc may then be cleaned out of the socket and after worn portions of the cable are removed the socket may be replaced as described above. It should, however, be noted that the process of heating to 1,950° F. followed by a rapid quenching in cold water is done in the foundry where the socket is cast and could not be carried out, and was not carried out, in the circumstances of the resocketing in this case, which will be described later.
The trial judge found that the mate of the Lorne Yorke, although an employee of Straits, was at all relevant times under the control and direction of Captain McLean, the master of the Lorne Yorke. He therefore considered that, being in the actual control and employment of Yorke, his negligence, if found to exist, would be attributable to Yorke. In this I agree with him and this point was not argued later. It may be observed here that in view of the position taken in this Court on the question of negligence in seamanship and navigation by B.C. Marine and Straits it ceased to be of significance.
He went on to refer to the scientific evidence called by the parties regarding the treatment of the socket and its effect, and expressed his findings in these words:
Having carefully considered all this evidence, I am of the view, using the usual test of more probable than not, in respect to both the expert and lay evidence, what Chapman and Babey of Wire Rope Industries of Canada (1966) Ltd., did at the material time in re‑socketing, because of the manner in which they did it and the time involved, did not result in the subject socket (Exhibit 3) becoming embrittled to any significant extent.
Whatever embrittlement there was in this subject socket, in my view, was caused by the indefinite number of re-socketing operations which were done to it prior to the occasion when Chapman and Babey did their work.
In addition, at the material time when the subject socket broke, it was not subject to just a straight linear pull. Instead, it was subject to a large number of stresses in various directions at the moment when it broke. As a consequence, it is difficult to say precisely how much strength and ductility it had lost.
Regarding the position in this matter of Yorke, he went on to say:
In coming to the conclusion I do, I am of the view, firstly either the Defendant, F.M. Yorke & Son Limited through its servants which includes in law the mate Tobiasen, may have caused the tug through improper seamanship to have got itself in the position it reached near the rocks at the southwesterly end of Kyuquot Channel so that even with proper seamanship, the tug could not have been extricated from its difficulty without breaking the towline; or second, it may be that the situation in which the Defendant, F.M. Yorke & Son Limited through its servants, got the tug into at the material time was a situation which it was not unreasonable under the circumstances of time and sea, to have got the tug into and that following that, the actions taken by Captain McLean were the correct actions and that the towline at the socket should not have broken and it broke only because it was a faulty socket which the Defendant, F.M. Yorke & Son Limited, knew or should have known was likely to occur or by contract impliedly warranted would not happen. (cf McKenzie Barge & Derrick Co. Ltd. v. Rivtow Marine Ltd. (1968), 2 D.L.R. 505.)
In either event, the Defendant, F.M. Yorke & Son Limited is liable to the Plaintiffs for the damages that resulted.
He held Wire Rope not liable in the matter and ordered judgment against Yorke in favour of Straits and B.C. Marine and directed a reference as to damages. The plaintiffs were given costs against Yorke and the actions against Wire Rope were dismissed with costs.
In the Court of Appeal, Pratte, Ryan and Smith JJ.A., Ryan J.A. speaking for the Court, allowed the appeal of Yorke against the judgment in favour of B.C. Marine and dismissed Yorke’s appeal against the judgment in favour of Straits. It also ordered that Yorke should succeed in its third party claim against Wire Rope and allowed the appeal by B.C. Marine and Straits against Wire Rope. The effect of this judgment was to render Yorke liable to the plaintiff Straits for the loss of the barge and give Yorke a right of indemnity against Wire Rope. It also gave judgment against Wire Rope for the loss to the plaintiffs B.C. Marine and Straits.
These appeals were taken by leave granted on June 29, 1978. The appellant Wire Rope asks that both of its appeals be allowed with costs and that the judgment at trial be restored. B.C. Marine and Straits seek the dismissal of the appeals of Wire Rope and Yorke against the Federal Court of Appeal’s judgment in their favour. B.C. Marine, as owner of the lost barge, also seeks a reversal of the Court of Appeal’s dismissal of the action against Yorke. Yorke asks that its cross-appeal from the judgment against it in favour of Straits be allowed and that the action be dismissed. Alternatively, if the cross-appeal is not allowed Yorke seeks an order for indemnification against Wire Rope for any damages and costs for which it may be held liable.
The hearing of the appeals commenced in this Court on March 11, 1980. On March 12 during argument the Court raised the question of jurisdiction of the Federal Court Trial Division to entertain Yorke’s action for indemnity against Wire Rope. This point had not been raised before. Counsel were referred to the judgment of this Court in R. v. Thomas Fuller Construction Co. (1958) Limited and Foundation Company of Canada Limited[2]. The hearing was adjourned to give time for counsel to consider the position in the light of the Fuller case and to submit new factums on the question of jurisdiction so that it could be argued in full. On April 23, 1980, counsel having filed new factums, argument resumed. The hearing was completed and judgment reserved. I will deal firstly with jurisdiction.
The question of jurisdiction of the Federal Court has been raised and considered in several recent cases, of which the most significant for our purpose is Tropwood A.G. and the Owners of the Vessel Tropwood v. Sivaco Wire & Nail Company and Atlantic Lines & Navigation Company, Inc.[3] At no time in these proceedings has it been contended that the Federal Court did not have jurisdiction to deal with the claims made by the plaintiffs B.C. Marine & Straits against Yorke. It is clear that these claims, arising out of a marine accident concerning rights and liabilities under a barge charter and a contract of towage and the exercise of due diligence in connection therewith, come within the ambit of Canadian maritime law as described in s. 2 of the Federal Court Act. The jurisdictional question arises, however, because of the claims against Wire Rope which allege a breach of contract and negligence in the resocketing of the main towing cable. The issue then is, do such claims fall within the jurisdiction of the Federal Court, or are they governed by provincial law and therefore come within the jurisdiction of the Supreme Court of British Columbia?
In Tropwood it was held, following earlier decisions in this Court in Quebec North Shore Paper Company et al. v. Canadian Pacific Limited, et al.[4] and McNamara Construction (Western) Limited et al. v. The Queen[5], that to give the Federal Court jurisdiction there must be a body of applicable federal law upon which that jurisdiction might operate. Such was not the case in Quebec North Shore, nor in McNamara, and accordingly jurisdiction in respect of the issues arising in those cases rested not in the Federal Court but in the Superior Courts of the provinces. However, in Tropwood, it was held that there exists a body of federal law described as Canadian maritime law in the Federal Court Act over which the Federal Court has jurisdiction, that it was within Parliament’s legislative competence under s. 91.10 of the British North America Act, and that certain of the paragraphs of s. 22(2) of the Federal Court Act gave specific jurisdiction to the Federal Court. Laskin C.J.C., speaking for the Court, said at p. 163: I come, therefore, to the Federal Court Act. I have already quoted s. 22(1) and I refer to the words “Canadian maritime law” therein, words which are defined in s. 2 of the Act as follows:
“Canadian maritime law” means the law that was administered by the Exchequer Court of Canada on its Admiralty side by virtue of the Admiralty Act or any other statute, or that would have been so administered if that Court had had, on its Admiralty side, unlimited jurisdiction in relation to maritime and admiralty matters, as that law has been altered by this or any other Act of the Parliament of Canada;
This definition is supplemented by s. 42 of the Federal Court Act, reading as follows:
Canadian maritime law as it was immediately before the first day of June, 1971 continues subject to such changes therein as may be made by this or any other Act.
This definition of Canadian maritime law in s. 2 refers to the law that was administered by the Exchequer Court “by virtue of the Admiralty Act or any other statute”. The. reference to the Admiralty Act is undoubtedly to the Act of 1934, but the Admiralty Act of 1891, although it was repealed, may certainly be considered as “any other statute” by virtue of which law was administered by the Exchequer Court on its admiralty side. If therefore there was a deficient incorporation of admiralty law by the Act of 1934, the same cannot be said of the Act of 1891.
He went on to pose two further questions in these terms:
Two questions, therefore, remain. The first is whether a claim of the kind made here was within the scope of admiralty law as it was incorporated into the law of Canada in 1891. If so, the second question is whether such a claim fell within the scope of federal power in relation to navigation and shipping.
He held that the claim made in Tropwood, “damage to incoming cargo”, had been brought into the admiralty jurisdiction of the Exchequer Court of Canada by The Admiralty Act, 1891, 1891 (Can.), c. 29, and that as a result such a claim, pursuant to s. 2 of the Federal Court Act, would be subject to Canadian maritime law under the jurisdiction of the Federal Court of Canada pursuant to s. 22(1) and certain paragraphs of s. 22(2) of the said Act. He held as well that the claim would also fall under federal legislative competence under s. 91.10 of the British North America Act.
Turning to the case at bar, the claim against Wire Rope by Yorke alleges negligence in the resocketing of the main towing cable pursuant to a contract made regarding such work, and claims an indemnity for loss caused by a breach of that contract. The claim by B.C. Marine and Straits involves negligence in the resocketing operation which resulted in their loss. It will be observed that the root of both claims lies in the work done by Wire Rope in resocketing the cable and that the cable was part of the equipment of the tug Lorne Yorke, a seagoing vessel which was involved in the marine accident that gave rise to this action. That such a claim formed part of admiralty law which was incorporated into Canadian law by the Canadian Admiralty Act of 1891 seems clear. That Act constituted the Exchequer Court of Canada a Colonial Court of Admiralty, conferring on it all the jurisdiction given in that Act pursuant to the British Colonial Courts of Admiralty Act, 1890, 1890 (U.K.), c. 27. The jurisdiction of the British High Court of Admiralty was therefore vested in the Exchequer Court of Canada. That jurisdiction was formed, in part, by another English Act, An Act to improve the Practice and extend the Jurisdiction of the High Court of Admiralty of England, 1840 (U.K.), c. 65. Section 6 of that last-named Act provided:
VI. And be it enacted, That the High Court of Admiralty shall have Jurisdiction to decide all Claims and Demands whatsoever in the Nature of Salvage for Services rendered to or Damage received by any Ship or Sea-going Vessel, or in the Nature of Towage, or for Necessaries supplied to any Foreign Ship or Sea-going Vessel, and to enforce the Payment thereof, whether such Ship or Vessel may have been within the Body of a County, or upon the High Seas, at the Time when the Services were rendered or Damage received, or Necessaries furnished, in respect of which such Claim is made. It is my opinion that this section is sufficiently broad to comprehend the claims made against Wire Rope in the case at bar.
The Canadian Admiralty Act of 1891 provided in sections 3 and 4:
3. In pursuance of the powers given by “The Colonial Courts of Admiralty Act, 1890”, aforesaid, or otherwise in any manner vested in the Parliament of Canada, it is enacted and declared that the Exchequer Court of Canada is and shall be, within Canada, a Colonial Court of Admiralty, and as a Court of Admiralty shall, within Canada, have and exercise all the jurisdiction, powers and authority conferred by the said Act and by this Act.
4. Such jurisdiction, powers and authority shall be exercisable and exercised by the Exchequer Court throughout Canada, and the waters thereof, whether tidal or non-tidal, or naturally navigable or artificially made so, and all persons shall, as well in such parts of Canada as have heretofore been beyond the reach of the process of any Vice‑Admiralty court, as elsewhere therein, have all rights and remedies in all matters, (including cases of contract and tort and proceedings in rem and in personam), arising out of or connected with navigation, shipping, trade or commerce, which may be had or enforced in any Colonial Court of Admiralty under “The Colonial Courts of Admiralty Act, 1890.”
This jurisdiction was carried forward by The Admiralty Act, 1934, 1934 (Can.), c. 31, and passed into the purview of the Federal Court by the Federal Court Act in its definition of maritime law in s. 2 and by the terms of s. 42 of that Act.
42. Canadian maritime law as it was immediately before the 1st day of June 1971 continues subject to such changes therein as may be made by this or any other Act.
Section 22(1) gives a general statement of jurisdiction, and s. 22(2)(m) and (n) reproduced hereunder are apt to cover the claims in question here and in part are a restatement of the jurisdiction of the British Admiralty Courts contained in s. 6 of the 1840 Statute cited above:
(m) any claim in respect of goods, materials or services wherever supplied to a ship for her operation or maintenance including, without restricting the gener- ality of the foregoing, claims in respect of stevedoring and lighterage;
(n) any claim arising out of a contract relating to the construction, repair or equipping of a ship;
I am therefore of the view that the claims made against Wire Rope come within Canadian maritime law as defined in the Federal Court Act. There can be no doubt in my mind that the substantive law relating to these claims falls within federal legislative competence under s. 91.10 of the British North America Act, being in relation to navigation and shipping. There is therefore law of Canada relating to the issues arising in this case upon which the jurisdiction of the Federal Court may operate. In my opinion, it is of no significance that the claim made by Yorke is a claim for indemnity. Claims for indemnity and third party actions, generally, are not mere incidents to the principal action. They are independent actions which stand upon their own feet. On this point I refer to the Fuller case, supra, where Pigeon J. referred to Bank of Montreal v. Royal Bank of Canada[6], at pp. 315-6, where Duff C.J.C. said:
… The Supreme Court of Ontario has jurisdiction, by virtue of the statutes and rules by which it is governed, to entertain and dispose of claims in what are known as third party proceedings. Claims for indemnity, for example, from a third party, by a defendant in respect of the claim in the principal action against him, can be preferred and dealt with in the principal action. But there can be no doubt that the proceeding against the third party is a substantive proceeding and not a mere incident of the principal action.
The Fuller case, in my view, is distinguishable. In that case Foundation Company of Canada, Ltd., a building contractor, brought action against the Crown for a breach of contract relating to damage caused by blasting operations which had been performed by another contractor, Thomas Fuller Construction Co. (1958) Limited. There was no doubt that the Crown had been properly impleaded in the Federal Court which had full jurisdiction to hear the plaintiff’s claim against the Crown. The Crown then issued a third party notice claiming indemnity against the Fuller company. In so doing, it relied specifically upon the law of Ontario to support a claim based on negligence. This Court held, as did the Federal Court of Appeal and the Trial Division, that there was no law of Canada to support the jurisdiction of the Court in respect of that particular third party claim. In this respect, the case differs from the case at bar, lacking the essential element of a law of Canada to feed the jurisdiction of the Federal Court. I am satisfied that the Federal Court had jurisdiction to entertain not only the claims made by B.C. Marine and Straits against Yorke, but also the third party claims made by Yorke against Wire Rope and the direct claims made by B.C. Marine and Straits.
I now turn to the question of the liability of Wire Rope in this matter. It will be seen at once that the only connection Wire Rope had with the matters raised in these proceedings resulted from the resocketing which was done for Yorke on October 13, 1967. Whether the claims against Wire Rope sound in contract or tort, and whether they are for direct relief or indemnity, the basis for any liability upon Wire Rope must remain the same. For success against Wire Rope it must be shown that its work on the socket caused or contributed to its failure, leading to the loss of the barge. For this reason the socketing operation must be examined.
On October 13, 1967 two workmen employed by Wire Rope came to the premises of Yorke to do some resocketing at the request of Yorke. Mr. J. C. Yahemech, marine superintendent for Yorke, gave them three or four socketed towlines, the precise number is not clear, and instructed them to remove the sockets and resocket the lines using the same sockets which were then on the lines. One of the lines involved was the line which failed in this accident. Mr. Yahemech left them to their task. He returned some hours later when the job was nearly completed. The whole operation took six hours. The cost to Yorke was in the neighbourhood of ninety dollars. When it was completed the cables, including the one used to tow the Westport Straits on the occasion of its loss, were left in the possession of Yorke and Wire Rope had no further part in the matter.
It was alleged that Wire Rope, for a period of something in excess of three years, had done all the resocketing for Yorke. This was not denied and both the trial judge and the Court of Appeal accepted this fact and spoke of an indefinite number of resocketings. It may be observed at this point that the only negligent resocketing alleged against Wire Rope was that of October 13, 1967 and, whatever the evidence of previous resocketings may have been in general terms, there was no evidence of any indefinite number of resocketings of this particular socket. The significance of this fact will be dealt with later.
A review of the evidence of certain of the expert metallurgists who were called by the various parties must now be made. Mr. Ian Heslop, a consulting engineer called by B.C. Marine and Straits, who has specialized in metallurgical engineering, served as a senior metallurgical engineer in industry, and has been called as an expert witness on metallurgical matters in many courts, gave evidence of having examined the socket. He found it to have numerous casting defects (shrinkage cavities and blow-holes); a brittle microstructure, whereas properly treated material would be tough and ductile; and considerable wear. He gave his opinion that the brittleness was the most significant cause of the failure, making the socket likely to fail under “shock, impact or bending loads of relatively small magnitude”. He felt that the socket had been heated above 650° F. and that this had rendered the metal weak and brittle and that this was the result of resocketing. He said that this particular metal should stretch before failing and it had not done so in this accident because of its brittleness. In his view, properly treated material would have a higher breaking point and cumulative damage would result from continued reheatings without proper reheat and quenching treatment.
Another expert, called by Wire Rope, James Pearce McCulloch, a professional engineer with high qualifications in metallurgical engineering and with broad experience in that field, gave evidence of various tests which he had made and experiments he had performed on manganese steel in an effort to determine the cause of the failure of the socket in question.
In one experiment Mr. McCulloch fractured a manganese steel socket which had been resocketed numerous times and fou