San Martine Compania De Navegacion, S.A. v. Saguenay Terminals Limited

In July, 1955, the appellee, here called Saguenay, as charterer, chartered the vessel Santa Ana from the appellant San Martine, owners, for portions of each of four ensuing years. The ship was operated under the charter until the owners, by notice dated November 9, 1956, invoked the clause of the charter party which provided that in the event that Canada, the United Kingdom, or the United States, became involved in hostilmercantile marine by any of those ities leading to the requisition of their countries, the owners and the charterers should have the right to cancel the charter upon completion of the voyage upon which she was actually engaged. In serving a notice upon Saguenay, the owners relied upon the Suez Canal attack which commenced in October, 1956, as the hostilities which gave rise to the right to cancel.

Saguenay requested withdrawal of the notice; that however, was refused. It obtained a replacement for the vessel from others at a higher charter rate and brought suit against San Martine in the court below alleging breach of charter and seeking recovery of damages for the claimed ensuing loss. The Santa Ana was seized to obtain security for the damage claimed.

San…