Circular No. 17.-LMM.

Admiralty, 21st February, 1874.

Seizure of Illegal Colours hoisted on board Merchant Vessels.

The Lords Commissioners of the Admiralty have had under their consideration the above question, and are pleased to issue the following directions:

With respect to the carrying of improper colours by British Merchant vessels, the 105th section of the Merchant Shipping Act, 1854, provides as follows:-"If any colours usually worn by Her Majesty's ships, or any colours resembling those of Her Majesty, or any distinctive national colours, except the Red Ensign usually worn by merchant ships, or except the Union Jack with a white border, or if the Pendant usually carried by Her Majesty's ships, or any Pendant in anywise resembling such Pendant, are, or is hoisted on board any ship or boat belonging to any subject of Her Majesty, without warrant for so doing from Her Majesty or from the Admiralty, the Master of such ship or boat, or the Owner thereof, if on board the same, and every other person hoisting or joining, or assisting in hoisting, the same shall, for every such offence, incur a penalty not exceeding £500; and it shall be lawful for any Officer on full pay in the military or naval service of Her Majesty, or any British Officer of the Customs, or any British Consular Officer, to board any such ship or boat, and to take away any such Jack, Colours or Pendant, and such Jack, Colours or Pendant shall be forfeited to Her Majesty."

2. Before exercising the above power in any case, the Naval Officer will send a communication in writing to the Master of the vessel, calling his attention to the above-mentioned section of the Merchant Shipping Act, and will further allow a reasonable time to elapse from the delivery of such communication.

3. In any home port the Officer will also, if he thinks necessary, apply to superior authority for instructions; and in any foreign port he will, by communicating with the Consul, or otherwise, endeavour to avoid giving offence to the local authorities.

4. Sec. 3 and 4 of Art. 12, p. 19, of the Queen's Regulations, and Circular No. 6 L. of the 4th February, 1869, are hereby cancelled.

By Command of their Lordships,

To all Commanders-in-Chief, &c

ROBERT HALL.

Inclosure in F.O. Circular, May 15, 1875.

The following Extracts from the "Instructions to Lloyds' Agents" have been printed by the Committee of Lloyds, for the information of Her Majesty's Consuls and Representatives, Commanders of Vessels and others.

It is essential that Lloyds' Agent should understand that, according to English law, the Master of a vessel has, as Agent of the Shipowner, control over both ship and cargo, and is responsible for both. Nothing less than a special power can take away this control over the property

confided to his charge; but the Master can appoint an Agent, and it is presumed that he will, on behalf of the Assured, or their representatives, readily avail himself of the assistance of an Agent who is specially appointed by Lloyds, and whose co-operation will facilitate the settlement of loss or average with the underwriters.

In every act of interference, whether by advice or otherwise, the Agent is not to be considered as the representative of the underwriters upon any particular policy, except when he is specially instructed to that effect, but rather as a person whose duty it is, from the nature of his appointment, to protect underwriters from fraud, negligence, or mismanagement in the mode of treating property in peril or under damage.

Shipping Lists.-The Agent will furnish, on the forms supplied by the Secretary and in accordance with the instructions received from him from time to time, prompt and regular advices of the arrival and sailing of vessels. He should also send the names of vessels arriving with damage, or having damaged goods on board, which have been surveyed under his superintendence; and the names of such vessels with damaged goods as have not been surveyed under his superintendence, and the reasons that may have prevented him from attending the survey of the whole or any part of the damaged goods in each cargo. Supplies of shipping forms and envelopes can be had on application to the Secretary of Lloyds.

Abandonment.-In no case is the Agent to accept an abandonment of either ship or cargo as the representative of the underwriters: he must in all cases leave the persons who abandon to act upon their own responsibility.

Total Loss.-In case of shipwreck, the Agent will take charge of the property in the absence of the Master or Owner of the vessel or goods or any of their representatives, or any legal authority, and he will make such arrangements for its protection and preservation as he may deem expedient. He will also give immediate advice of the circumstances to the assured, and follow their instructions in all cases where he can obtain them.

Attendance of Master.-All surveys should be attended by the Master of the vessel, who should also sign the certificate of survey. In case the Master refuses to attend or is prevented from attending, the Agent will note the fact on the certificate, and the reason of the Master's absence.

Bottomry. Particulars of Bottomry and Respondentia Bonds should in all cases be reported to the Committee. The raising of necessary funds by these means should not be resorted to unless credit cannot otherwise be obtained, and the Owner should in all cases be previously communicated with, either by letter or by telegraph. The sale of vessels or cargoes at ports of arrival under these bonds should also be reported.

Auctions. In cases where combination amongst buyers is likely to defeat the integrity of a public sale, the Agent should see that sealed tenders are advertised for, if such a course can be legally pursued.

Auctioneers. With a view to prevent frauds upon underwriters at public sales, the Agent should endeavour, whenever a sale is unavoidably necessary, to have a voice in the appointment of the Auctioneer, and he should see that due publicity of the sale is given in each case.

Ship Stranded. When a vessel is in distress, or on shore, within the

1

limits of his district, it is the duty of Lloyds' Agent to offer his services to the Master.

Condemnation as Unseaworthy.-When it is proposed to condemn as unseaworthy a vessel that has sustained damage, the Agent is to use every means in his power to prevent such condemnation, unless it is evident that the vessel cannot be repaired so as to enable her to prosecute her voyage. In case a vessel cannot be repaired, and her condemnation as unseaworthy becomes unavoidable, it is the duty of the Agent to investigate carefully and to distinguish whether such condemnation is caused by perils of the sea or by any natural defect or decay.

Surveyors and Repair.-In the event of repairs being necessary to enable a ship to proceed on her voyage, the Agent will see that properly qualified men are appointed surveyors.

In selecting a surveyor, the Committee would prefer that the choice. should fall upon the Surveyor to "Lloyds' Register of British and Foreign Shipping," whenever there is one stationed at the port.

It is necessary that the Surveyors should distinguish as far as possible in their survey and estimates between the damage sustained during the voyage in which the vessel is actually engaged and the damages or defects existing prior thereto, and which are chargeable to the Owners.

Documents. The necessary documents in cases of claim against the underwriters on the ship are :—

1. The Protest, which should be compared with the Log-Book and certified by the Agent, who should report any discrepancies that may be discovered between them.

2. Surveys describing distinctly the cause of damage.

3. General account of disbursements.

4. Vouchers or receipted bills included in the general account, and discount allowed if any.

5. Rate of exchange.

6. The Bottomry Bond (where there is one).

7. The value of the ship and the certificate, according to Form B in the Schedule.

Survey.-Lloyds' Agent, if called on by the consignees of a cargo to certify damage, will only act as a Surveyor when his experience of the class of goods to be surveyed enables him to pronounce an accurate opinion. But when he does not act himself he will appoint properly qualified surveyors, and will take care that the survey is conducted in accordance with the following general instructions :

1. A special survey should be held on the hatches of the vessel, and particularly with reference to the stowage and dunnage of the cargo.

2. Damage by sea water during the voyage should be carefully distinguished from damage arising from other causes, as, for example, from bad stowage or packing, vermin, pilfering, inherent causes, or from the goods having been exposed to rain or damp before shipping or after discharging.

In some cases it may be necessary that the Agent should personally satisfy himself that these instructions are carried out.

Survey of Goods on Landing.-The survey of damage should take

place as soon as the goods are landed, and with this object the Agent should immediately offer his services to the consignee. In the event of any unreasonable delay taking place before the Agent's services are called in, the Agent should not refuse a survey, but should grant a certificate, with the date of the arrival of the vessel, and the date and place of survey prominently noted on it.

Sound to be separated from Damaged.-The Agent is to see that the sound portions of each package are separated from the damaged, and he will particularise the quantity of each in his certificate. In the event of the separation of the sound goods from the damaged not being assented to by the consignees, the Agent will notify their objections.

Damage in Craft.-In all ports where it is necessary to discharge goods into lighters or craft, the Agent is required to ascertain whether the person in charge of such lighter or craft has demanded of the Master or Mate of the vessel discharging, a certificate, or himself given a receipt, expressing any apparent damage or defects in the goods delivered over to him; and the Agent is to make a note of the same upon his survey.

Deck Loads.-The Agent will ascertain and notify whether any and what goods were laden on deck.

Sale of Goods at an intermediate Port.-In the case of a vessel putting into an intermediate port, the Agent should protest against the sale of any part of the cargo unless absolutely necessary from its perishable condition.

In the case of a vessel being wrecked short of its destination, the Agent will offer to co-operate with the Master or other representatives of the Assured in procuring a conveyance for the cargo to its original destination in the best and most expeditious manner.

Sale to take place in reasonable Time.-The sale should take place within a reasonable time from the period of landing, and the usual certificate of sound value should give the market value of the goods at the date of sale.

Exaggerated Valuations.-Care should be taken to guard against exaggerated valuations; and if part of the goods arrive in a sound state, and are sold, a certified copy of the sale of such sound part should always be furnished.

Documents.-The documents required by the underwriter for the adjustment of average on goods damaged by sea water are as follows:1. The protest, which should be compared with the Log-Book and certified by the Agent, who should report any discrepancies that may be discovered between them.

2. Survey on board and certificate of stowage.

3. Survey on goods landed, stating clearly cause and nature of
damage; if the damage does not arise from sea water, the same
should be certified, as well as its probable cause.
The survey
should also state the mode in which the goods were packed;
and if in tin or zinc, whether properly soldered; and in cases
of claim for leakage of liquids, the condition of the packages
on landing, and whether the same were of good construction and
fit for the voyage.

4. Custom House Certificate of rebate of duties on account of damage.
5. Certificate of the market price or value of the goods at the time of

sale for cash if they had arrived free from damage, or certificate of the actual sale of the sound, which is always to be preferred. 6. Account sales of damaged goods duly certified and showing whether sold in bond or duty paid, and for cash or credit; and if for credit state what deduction for discount should be made to reduce the proceeds of sales to cash.

7. The Agent to certify on his certificate which of the charges described in the documents are extra in consequence of the damage, and if sold by auction whether any and what portion of the auctioneer's commission is returned, also if any and what charges are paid by the buyers of the goods.

8. In cases of damage to articles usually sold by weight, it is desirable, where practicable, to forward a certificate of the weight of the sea-damaged portion, also the total gross and net landing weight of the sound portion of each mark separately.

Capture of Neutral Goods in Enemies' Vessels. If the country in which the Agent resides is at war with any other country, and a captured vessel of that other country should be brought into any port within the Agent's district, he should watch the proceedings of the Prize Court, and endeavour to prevent any sale of the cargo either before or after the condemnation of the vessel as lawful prize.

In reporting the circumstances to Lloyds, he should point out particularly what steps it will be necessary for the owners of the goods to take, whether in any local Marine Court or in the Central Court of Prize, to obtain possession of their goods, and should specify the documents which the Court will require for establishing the ownership of the goods, and for proving that the owners belong to a neutral country.

Insured Property in peril.-When a vessel is in distress or on shore within the limits of his district, it is the duty of Lloyds' Agent to make such arrangements with the Master for recovering, saving or preserving the property as may be deemed expedient. It is repeated that the Agent, by this instruction, is not empowered to accept an abandonment of either ship or cargo.

Salvage. In all cases where salvage or remuneration is claimed for assistance rendered to vessels, the Agent should attend the meetings of commissioners, magistrates, or other persons legally authorized to determine the amount, in order to rebut, by the evidence of the Master and crew, any exaggerated statements on the part of the salvors.

Salvage for Recapture.-It has frequently happened, when a vessel has been captured and recaptured, that instead of the salvage being paid, and the vessel proceeding to her port of destination, both vessel and cargo have been sold for the payment of salvage, and the loss of the underwriters been thereby much increased. It is therefore incumbent on the Agent to endeavour, upon every occasion, to take such steps as appear requisite for an adjustment of the salvage, so that the vessel may proceed with her cargo to her port of destination.

Average Statements.-The Agent is not to make up or sign any statement of average, either general or particular, leaving any claim to be adjusted between the underwriters and the assured, upon the documents furnished.

M