This was an application by the defendants in the above suit for leave to file a counterclaim against the plaintiffs and also for an order that the plaintiffs should find security.
Mr. A. P. Stokes (Messrs. Stokes and Platt) made the application on behalf of the defendants, and Mr. J. C. Hanson (Messrs. Dowdall, Hanson and MeNeill) opposed the application on behalf of the plaintiffs. 7 Mr, Stokes said that his application was made under Rule 35 of the Rules of the Supreme Court, by virtue of the Order in Council of 1o>4, section 41. By this rule it was laid down that where in his answer a defendant raised a specific defence, he might be entitled to relief by filing' a counterclaim in cross suit, and the Court might make such order or terms as seemed just, and might also order the plaintiffs to give security for costs. With regard to the last point, the pleadings spoke for themselves. It would be admitted, he believed, that the point arose out of the natural order of things. With regard to the first. point, he believed that the Court had a discretionary power, and he would first refer his Lordship to what had taken place in similar cases at home. Counsel quoted a case from the Law Times Reports, Vol. 8, p. 281, which he held was almost on all fours with the present case, and said that the powers of this Court and of the home Court were practically the same. It was not entirely on all fours with the present case. The facts were that a Dutch firm was sued by a British firm and the latter lost the action on the ground of want of jurisdic~ tion. The Dutch firm afterwards brought an action against the British firm in connection with the same matter. Leave to issue a counterclaim was granted to the British firm, because the Dutch firm had come into that Court voluntarily as plaintiffs. The Dutch firm alleged that as the Court had no inrisdiction to allow an action brought against them in that Court to succeed, therefore the Court could not allow a counterclaim. The position therefore was, that although the British firm could not succeed in an action against the Dutch firm, yet because the Dutch firm came voluntarily into that Court against a British firm, and so under the Court's jurisdiction. the defendants were entitled to counterclaim.
His Lordship said that the Court in question was one of plenary jurisdic whereas this Court had only limited jurisdiction.
Mr. Stokes said that in his julement the case just quoted, L. J. Coleridge said that it would be monstrous and absurd to prevent the British firm from counterclaiming under the circumstances. The Dutch firm had voluntarily come under the jurisdiction of the Court and were therefore under the full powers of the Court.
His Tordship referred to the recent case of the Ravenna v. Chisima.
Mr. Stokes said that in that case there were many distinct differences from the present case. The reasons given by the Privy Council for refusing a counterclaim [in that case was that the suit arose in Japan. The Japanese government brought an action in the British Consular Court against the P. and O. Company and it was in that Court in Japan that the P. and Q. Company endeavoured to counterclaim against the Japanese and the-judyment of the Privy Council was to the affect that the existence of the British Court in Japan was a concession granted by the Mikado, and the jurisdiction of the Court was limited by the treaty and counterclaim could therefore be allowed. The limit of the concession granted by the treaty with Japan was simply that British subjects should be tried and claims brought against them in the British Consular Court; a counterclaim would go beyond that concession. But that consideration did not apply to this case at all. Supposing a Chinese brought an action in that Court against a British subject, there could not be a counterclaim against the Chinese subject because by tne treaty the Emperor of China only abrogated certain rights and counterclaim was not one of them.
The present case—that of an American ship bringing action against a British ship—was quite outside the case of the Ravenm v. Chishima.
His Lordship said that it seemed to him that Court had no mie power against an American plaintiff than against a Chinese, The power of the Court was limited by treaty and where was the Court to get authority against. American plaintiffs? The Court in Ensland had to 00 justice to any party while the ju ion here was limited by the powers given by the treaty.
Mr. Stokes submitted that the Order in Council was distinctly intended to meet a case of this nature. Ti ad any mean ing at all, it was meant for a case of this nature.
His Lordship said that supposing a subject. of Bolivia, which country bad no treaty with China, had a right of action against a British' subject, he must sue in the British Court, but could only, on the other hand, be sued in a Chinese Court. In such' a case, in the action brought by the Bolivian in the British Court, an order would be made that the plaintiff' should give security, for the British subject having to sue in an un-civilised Court must have rights correlative with some civilised code, Mr, Stokes said, with regard to treaty rights, as the American plaintiff was pursuing his remedy in this Court. he was bound by its rules and orders. He could not come and plead any treaty between England and China.
His Lordship said the American plaintiff had to go to that Court because he had no other Court to go to. _Mr. Stokes said that the owners of the Newchwang, the China Navigation Ca., could be sued in any British Court, though it was convenient no doubt: for the plaintiffs to come to that Court. If they submitted to the jurisdiction of the Court the only thing which could prevent: the defendants from _counterclaiming would be by treaty. If the plaintiff was a apanese the Ravenna case would be fatal. If plaintiffs wore Chinese subjects they would not. be able to submit them to the Rules. The American plaintiffs agreed to submit to the jurisdiction of that Court, and part of that jurisdiction, as laid down by the Order in Council of 1881, was the right of counterclaim. Tu the case of the Dutch firm, cited by him, the British Court had no jurisdiction and the action against the Dutch firm failed, but when the latter came to the British Court as plaintiffs they had to accept the jurisdiction of the Court and Tord. Coleridge spoke very strongly on the point. Before going to the second point, he wished to submit that in counterclaiming they were not limited to a certain amount,
Text read from the printed page and cleaned; old type leaves the occasional error.