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Cite as: (1910) 1 SLT 277, [1910] ScotCS CSIH_3, 1910 SC 531

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17 March 1910

The Admiralty

Lord Kinnear.—The first parties to this case are the Lords of the Admiralty, and the other parties are tenants of certain farms on the estate concerned, which the Admiralty acquired by purchase from the late Lord Hopetoun in 1903. The leases under which the other parties hold were current at the date of the purchase, and the question is whether the Admiralty, as coming in place of the lessor, are entitled to take advantage of a condition under which the landlord is enabled to resume portions of the farms for purposes described in the leases, the tenants receiving compensation by way of abatement, and also damages in respect of growing crops or unexhausted manure which they may lose. The second parties are willing to surrender the ground, but they maintain that they are not bound to do so on payment of the stipulated compensation, because the purposes for which the first parties require it do not fall within the scope of the clause of resumption—I should say the clauses of resumption, because there are three leases and three tenants, but as the leases are all in identical terms, I take it as if we were dealing with one clause in one lease.

The general purpose for which the first parties require the land is said to be for works in connection with the construction of a naval base at Rosyth; and it is stated in the case that the possible construction of a naval base was not within the knowledge of the parties to the said respective leases at the time of their execution. Although that is stated as a fact upon which the parties are agreed for raising the question of law before us, it does not appear to me to be a relevant fact. Stipulations regarding contingencies which are to extend over a considerable period of years are expressed in general terms just because the particular cases which they are intended to cover are not known to or foreseen by the parties to the contract. The question, therefore, is not whether the design of the Admiralty's operations for the construction of a naval base was or was not anticipated by the parties, but whether the specific purposes for which they propose to acquire the land are within the scope of the particular powers reserved. These purposes are (1) the making of a road through parts of the farms of Rosyth and Hilton, described in the seventh article of the case; and (2) the erection of buildings and machinery in connection with the construction of the piers and docks which are to subserve the main purpose of the naval base.

There are, as I read the lease, two separate and distinct provisions enabling the landlord to resume in different circumstances; but I think it is the second of these provisions only which requires our consideration, because the first, as I read it—and I cannot say it appears to me to be at all doubtful—is limited to operations which the landlord may desire to execute for the purpose of working minerals. This part of the lease begins by reserving to the proprietor what would have been reserved at common law without any express reservation—“the whole mines, minerals, and metals of every description … in the subjects hereby let, with full power to search for, work, win, smelt, burn, and manufacture, and to carry off the same, and to sink pits, form levels, make roads, railroads, canals, erect buildings and machinery, and carry on all works within the subjects thereby let which he may think proper, and to resume the land he may think necessary for these purposes.” I think everything that is contained in that clause is necessarily limited by reference to the avowed purpose of working the landlord's minerals. But the second clause begins in terms which to my mind make it perfectly clear that it is a distinct and additional power for which the landlord intends to stipulate; “reserving also full power at all times to take off land from any part or parts of the subjects thereby let for the purpose of planting, feuing, or letting on building leases, or for making, altering, or widening roads, or for making railroads or canals, or for any other purpose.” It was argued by the second parties that these last words “or for any other purpose” must be limited by reference back to the first power for the resumption of land for working minerals, but that appears to me to be entirely inconsistent both with the formal language and with the plain intention of the clause, because the meaning of the word “also” is not doubtful; and when a landlord has stipulated for one power, and then goes on to stipulate “also” for another power, the second is plainly stipulated as something in addition to the first, and not as something which is to be governed by the first. But then I think also the notion of any reference to the first power is excluded by the nature of the powers themselves which are specified in the second clause, because “planting, feuing, letting on building leases, or for making, altering, or widening roads, or for making railroads or canals,” has no kind of relation in fact to the working of minerals. People do not plant the mineral strata beneath their lands, nor can they grant feus for building upon them, and therefore the two clauses seem to me to be quite separate.

That being so, and reading this second as a distinct clause, I am of opinion that the first of the two purposes for which the Admiralty require the land, namely, that of making roads, is within the plain meaning of the specific powers stipulated for. It is said that whatever may be thought about the other specific powers in this case, power to make roads or canals must be restricted with reference to the power to work minerals. I think that argument is excluded, not only for the reasons I have already mentioned, but because in the clause applicable to the working of minerals there is express power to make roads for that purpose. The lease goes on in the next clause to stipulate generally that the landlord may make roads. That stipulation would be perfectly useless if it applied only to the making of roads for minerals, since that had been already provided for; and the natural implication is that these roads are for more general purposes.

But then that does not dispose of the more difficult question whether it is within the scope of the clause that the first parties should use the land for the erection of buildings and machines in connection with the construction of piers and docks. The words of the reserved power are certainly wide enough to cover this or any other purposes; but then it is said that since the stipulation is for certain enumerated and specified purposes, the general words which follow the specific enumeration must be construed to cover only other purposes which are ejusdem generis with those specified. That this is a rule of construction nobody disputes, but it is a rule of construction only, that is to say, it is a canon which must be used to guide the Court in construing a written instrument in order to find out what is the true intent and meaning of the language used, and I think we must be cautious in applying it as if it were an abstract rule of law which could be used to force a meaning upon the words of the contract irrespective of other indications of what is the true intention of the parties. This is really, as it seems to me, only a particular illustration of the general rule for the interpretation of written instruments, that doubtful words must be read with reference to the context and with reference to the general intent and purpose of the instrument under construction.

I think that view is in conformity with the doctrines laid down in the House of Lords in the case of the Thames and Mersey Marine Insurance Co. v. Hamilton, Fraser, & Co . I do not think the decision in that case and the decision in the case of Tillmans & Co. v. s.s. “Knutsford” Limited, also cited to us by the second parties, are authorities for the decision of the present case. They are not, in my opinion, really in point, because they concern the construction of contracts of a totally different kind from that with which we are concerned, and contracts which were required to be interpreted with reference to considerations which have no application to this particular case. The case of Tillmans was a case involving the construction of a bill of a lading, and that of the Thames and Mersey Insurance Co. was upon the construction of a contract of marine insurance, and both of these contracts, as was very clearly pointed out by the noble and learned Lords in the case of the Thames and Mersey Marine Insurance Co., have been the subject of judicial construction for so long a period that the persons entering into them must be presumed to have accepted the meaning imposed by a series of decisions both upon particular words and upon general words in such contracts.

The decisions, therefore, are not, in my opinion, in point. But then I think the observations which are made by the noble and learned Lords in the case of the Thames and Mersey Marine Insurance Co., with regard to the true meaning and effect of construction of the canon in question, are of the highest value. Lord Halsbury, who was then Lord Chancellor, puts it in this way. After saying that the words of the clause then in question, (which is one of the ordinary clauses insuring against perils of the sea), were in themselves wide enough to include the particular risk which was in question in that case, he goes on to say—“two rules of construction, now firmly established as part of our law, may be considered as limiting those words. One is that words, however general, may be limited with respect to a subject-matter in relation to which they are used. The other is that general words may be restricted to the same genus as the specific words that preceded them.” What I observe in this sentence is that the learned Lord Chancellor says the general words may be so restricted, and not that there is a rule of law by which such words must be restricted, irrespectively of other considerations; but he goes on to lay down the more general rule that it is to be remembered that what the Courts have to do in the construction of written documents is to reach the meaning of the parties through the words they have used. And then he goes on to consider what is to be presumed was the meaning of persons entering into a contract of marine insurance with reference to the accepted meaning of the words employed. Lord Herschell says:—“It is contended on behalf of the appellants that these general words, following a specific enumeration, must be limited to perils ejusdem generis with those specified, or, to put it in another way, that they must be construed with reference to the scope and purpose of the instrument in which they occur, viz., a policy of marine insurance.” Now, I think the view of the law stated by both these noble and learned Lords makes it clear that we are not to apply this canon as an abstract rule of law which by itself would enable us to put a meaning on the contract, but that we are to begin by reading the contract itself, taking it as a whole, considering the true meaning of the particular clause with reference to its language, to its place in the contract, and to the general scope and purpose of the contract itself.

Now, there are two observations which occur to me upon the construction of the clause itself. In the first place, with reference to the language of the clause, I observe that the general words which are intended to cover the purposes unspecified are not only in themselves wide enough to cover the particular purpose in question, but that they are as wide as the form of language can make them, because the words of the reservation are “full power to take off land,” for certain purposes, “or for any other purpose.” I do not think that it is proper in the construction of a clause to deny all force to terms such as the word “any.” “Any purpose” does not, in ordinary language, mean for certain purposes or for purposes of a certain kind; it means any other purpose, whatever it may turn out to be. “Any purpose” is any you please. But although I make that observation on the phraseology, I do not think it at all conclusive, both because in other cases a similar phrase has been found and yet the canon of ejusdem generis has been held to apply, and still more because of the principle of the rule itself, which assumes from the beginning that words are to be restricted within a narrower range than would naturally belong to them taken by themselves; but as far as the phraseology goes, it is, I think, an indication that what the parties to the contract intended is an unlimited general reservation.

But the second observation is perhaps of more importance, and it is this, that if you are to limit general words by holding that they must cover only things that are ejusdem generis with preceding specific words, you must find that these specific words themselves are ejusdem generis with one another. The question is, whether the enumerated purposes have such a common characteristic as to make a genus, because if they have not, the contract does not disclose a particular category by reference to which the general words are to be limited. Now, I confess I have great difficulty in seeing what is the common characteristic which is said to be expressed in all the specific purposes for which the landlord is to resume the land under this contract. He may resume for planting, for granting feus, without any restriction as to the uses to which the feuar may put his property, for letting on building leases, without any restriction as to the character of the buildings, for making railroads or making canals, or any other purpose. I confess I do not see what the genus is, which is to limit the construction of these last general words. I do not wish to put too much weight upon that circumstance either, because the point arose in the Thames and Mersey Insurance Company case, and did not receive effect in the House of Lords; but then I think that the reasons for which it failed to receive effect are not such as to prevent the necessity for our considering it in the present case. In the first place, the meaning of the general words under consideration in that case, as Lord Halsbury and Lord Herschell both pointed out, has been fixed by a series of decisions, and therefore the force of them was well understood; secondly, Lord Macnaghten, who alone deals specially with the point, declined to give effect to it on grounds which I rather think not only do not exclude our considering it, but make it necessary that we should do so. What he says is:—“It was objected by Mr Cohen that the rule of ejusdem generis does not apply unless you can find a common characteristic running through or underlying the previous words. I do not know that this is so, at any rate where several distinct cases are enumerated leading to a common result, or intended to be met by a common remedy.” Now, the common result which all the distinct cases in the clause under construction led to was sea damage, and accordingly there was no difficulty in applying the general rule so as to exclude anything which did give rise to sea damage.

But that leads one to consider what is the common result to which the several and distinct cases that are enumerated in the present clause lead. I cannot say that I can find any other than this, that they all necessarily lead to the result of the land being diverted from the purposes of an agricultural lease. But then if that is the common result, that covers the Admiralty's case. Their object in taking the land is to apply it to purposes which would divert it from the agricultural purposes for which it was let. I should be disposed to agree that if a landlord attempted to use a clause of this kind for the purpose of taking land in order that he might use it himself, or let it to somebody else to use, for growing crops or for grazing, the tenants might very well be entitled to say that such a purpose would not fall within the general words of the reservation, because the whole purpose of the reserved power was to take the subject away from agricultural purposes altogether. But then I think that this is exactly the purpose for which the Lords of the Admiralty propose to use it. At all events, I do not doubt that the generality of the power must be limited by reference to the purpose and scope of the contract, and therefore the landlord could not take back ground to such an extent or for such purposes as would prevent the tenant from making a profitable use of the remainder for the purpose for which it was let. But no objection of that kind is taken in the present case.

If it were necessary,—and I again confess I have a little difficulty in grasping the principle upon which it should be necessary,—to relate the purpose for which the power of resumption is exercised, not to the whole category of specified cases, but to one or other of the particular cases enumerated, I should say that that purpose for which the Admiralty proposes to use the land is ejusdem generis with the specified purpose of granting leases for building. That is a destination in which the tenant has no interest whatever. If the landlord granted a lease of this ground for building or for a feu, his lessee or his vassal is not required by the clause to be put under any restriction as to the kind of building he may erect. He may erect what he pleases. He may build houses. He may build factories. I see nothing to prevent him erecting the buildings and machinery necessary for the construction of piers. But the construction of these works by the landlord himself is, for all purposes of the contract, exactly the same kind of thing as the construction of such works by his tenants or by his vassals. The tenant under the lease has no interest whatever in the question whether they are constructed by his landlord or by persons whom his landlord enables to do so.

I am therefore of opinion that the case of the Admiralty is well founded, that they are entitled to take these lands for the purposes specified, and that in the general words under which they claim there is no such limitation as would exclude their so doing. The result is that we ought to answer both the first and the second questions in the affirmative.

Lord Johnston.—The Earl of Hopetoun, as proprietor of lands at Rosyth, let the farms of Hilton, Rosyth, and Orchardhead to three tenants, with power of resumption of land for certain purposes, expressed in identical terms. Thereafter the Commissioners of the Admiralty acquired Lord Hopetoun's, then Lord Linlithgow's, lands at Rosyth for the purposes of a projected naval base, which is understood to include docks and their appurtenances, and, specially with reference to Admiralty purposes, all that is necessary in the way of machinery and machine shops for the repair and fitting out of ships and for their supply.

The question in this case relates to the rights of the Commissioners of the Admiralty, as coming in place of the Earl of Hopetoun, to resume lands for the purposes of their works, paying therefor merely the compensation provided by the leases.

The purpose of the resumption was, first, for a new road through the property; second, for the erection of buildings and plant in connection with the construction of the said naval base.

Now, there is a twofold provision in the leases for resumption. I do not think that it is necessary to consider the first, as it is clearly limited to land required in relation to the working of reserved minerals, and the smelting or otherwise treating or working up into other products such minerals when won. And it can hardly be pretended that, as the works of the Commissioners of the Admiralty cannot be brought under this category, they are entitled to the benefit of certain general powers conferred in relation thereto.

But the second provision is as follows:—“Reserving also full power at all times to take off land from any part or parts of the subjects hereby let for the purpose of planting, feuing, or letting on building leases, or for making, altering, or widening roads, or for making railways or canals, or for any other purpose.” This purpose of resumption is not restricted by any reference to minerals.

The power to make roads is general and in no way restricted by its collocation with the preceding purposes of resumption, viz., planting, feuing, or letting on building leases. Though the road in question would never have been made but for the projected dockyard works, there can, I think, be no doubt of the power of the Commisssioners to resume the land necessary for it, extending to about six acres, from two of the farms in question. It is not material, but it was explained that its object is not directly or exclusively to give access to the Admiralty works, but to relieve the traffic on the existing road.

For the further purpose of works, an average of twenty-five acres is required from each of the three farms, out of total areas averaging about two hundred acres, and the ground in question is all on the seashore, extending from the present highroad on the north to the sea on the south. There is therefore no question of a wholesale resumption, such as might be regarded as in fraud on the lease.

The question for the Court is whether, accepting the guidance of the rule of construction known as ejusdem generis, the purpose in question comes under the same category as any of those mentioned—Tillmans & Co. These are, speaking generally, purposes of land development, but in certain specific directions, What the Admiralty have in contemplation has, of course, nothing in common with planting or making, altering, or widening roads, or even making railroads. But there are other purposes enumerated, viz., feuing, letting on building leases, and making canals. Feuing in its ordinary acceptation contemplates building, and certainly letting on building leases does so. And if a proprietor may resume for the purpose of enabling other persons to build, I think that resumption for the purpose of himself building falls under the same category. Now, there is no restriction on the class of building. A factory, equally with a dwelling-house, is covered by the general terms used. And if the proprietor could resume to give off ground to another for erecting what is commonly termed a public work, I think he could equally resume for the purpose of starting a manufacturing business himself. It could hardly be maintained in pari casu that the Duke of Buccleuch could resume ground at Caroline Park to feu off to the town of Edinburgh for their great gasworks, and could not resume for the purpose of any business enterprise in which he himself might wish to engage. And the purpose for which the land in this case is wanted is for building, and for buildings of the same character as a factory or public work. It is not for the docks themselves, which are necessarily to seaward, on this line of coast if not always, of high-water mark, but for shore adjuncts of such docks. I do not, therefore, require to consider whether the docks themselves would fall under the same category as canals, though there would be much to say in favour of the contention.

I think, therefore, that the questions submitted both fall to be answered in the affirmative.

Lord Salvesen.—This question arises between the present proprietors of the farms of Rosyth, Orchardhead, and Hilton, which they acquired by private agreement in 1903 from the former owner, the Earl of Hopetoun. The three farms in question had been previously let on agricultural leases to the other parties to the case. The Commissioners of Admiralty desire to resume possession of part of the lands included in each of these leases for the erection of buildings and plant in connection with a proposed naval base, and the question we have to determine is whether they are entitled to do so on compensating the tenants in terms of the leases, or whether they must pay compensation on the same footing as if they were acquiring the land under compulsory powers. This question depends entirely on the construction of the clauses of the leases printed in the appendix.

The first clause founded on by the Commissioners does not, in my opinion, empower them to resume possession of the lands in question for the purposes of a naval base. The clause starts by a reservation of the minerals, and confers power on the landlord to search for and work them, to sink pits, make roads, erect buildings and machinery, “and carry on all works within the subjects hereby let which they may think proper, and to resume the lands they may think necessary for this purpose.” It was argued that this clause gave the landlord an unqualified right to resume land for the purpose of erecting buildings and machinery, but I think it cannot be so construed. No doubt there is a power to resume land for these purposes, but, in my opinion, only so far as reasonably necessary for the proper development of the minerals in the estate. We were told that, as regards one portion of the lands sought to be resumed, the intention of the present owners is to utilise it in connection with a quarry; but by far the greater area is not in that position, and there is no attempt to draw any distinction in the question of law stated for our decision between the relatively small area and the other lands.

The second clause founded on is in these terms:—“Reserving also full power at all times to take all land from any part or parts of the subjects hereby let for the purpose of planting, feuing, or letting on building leases, or for making, altering, or widening roads, or for making railroads or canals, or for any other purpose.” This clause must be construed with reference to the subject-matter of the lease, and consistently with the farm continuing to be tenanted as an agricultural subject. To take an extreme case, it is obvious that Lord Hopetoun could not, under this clause, have resumed possession of the bulk of the agricultural land, leaving only the steading and its immediate surroundings in the possession of the tenant. A power so exercised would have defeated the purpose for which the lease was entered into. Apart from such an extreme case, it must be a question of circumstances whether the land sought to be resumed forms so material a part of the subjects let that it cannot be reasonably regarded as within the contemplation of and would be against the good faith of the bargain embodied in the lease. No such question arises in the present case upon the facts, for it is only proposed to take 23 acres out of a total of 243 from Rosyth farm, 27 acres out of a total of 206 from Orchardhead farm, and 21 acres out of 186 from Hilton farm; and it cannot be said that these areas are so large in relation to the acreage let as to make the farms substantially unworkable as agricultural subjects. Further, no such case is made on the pleadings.

Taking, then, the clause as it stands, it seems to me impossible to contend that Lord Hopetoun would not have been entitled to feu or let on building leases to the Commissioners of Admiralty the areas of the respective farms which are here in question. There is no limitation whatever as to the purposes to which the land feued or let on building leases is to be applied; and I take it to be clear that Lord Hopetoun would have been entitled to have resumed the several areas in question for the purpose of feuing them to persons who desired to erect factories or similar buildings upon them. It was contended that while this might be so in the case of private feuars, it does not follow that a landlord would be entitled to resume lands upon the same terms for the benefit of a company possessing Parliamentary powers. It is true that a railway company acquiring the ground compulsorily would have required to compensate the tenants upon an entirely different footing from that upon which the landlord could himself resume possession of the land; but the clause contemplates the right of the landlord to resume land for the making of railroads, and I think that cannot be limited to a private undertaking. I see nothing to have prevented Lord Hopetoun from resuming the areas in question, for the purpose of selling them to a railway company to be used in connection with their undertaking; and, if so, the concluding words of the clause, “for any other purpose,” are sufficiently broad to have entitled him to have feued the lands to the Commissioners of Admiralty for the purpose of making a naval base.

The Commissioners, however, do not propose to feu, or let on building leases, the areas in question, but to erect buildings and machinery upon them, retaining in their own hand the dominium utile of the ground. They are therefore not within the express purposes enumerated in the clause, except in so far as regards the making, altering, or widening of roads. Reliance, however, is chiefly placed upon the general words to which I have referred. In my opinion Lord Hopetoun under these words would have had power to resume lands for the purpose of himself erecting buildings and machinery upon them, just as he was entitled to feu or let them on building leases for the same purpose. If so, I cannot see how the Commissioners are in any worse position. It may be assumed that neither party, at the time when the lease was entered into, contemplated the particular use to which the land is now about to be put; but the question is not as to the contemplation of parties, but as to the fair meaning of the reserved power. I think that question is not free from difficulty, but I have come to the conclusion that the clause cannot be construed so as to exclude the Commissioners, as the present owners, from resuming land for the purpose for which they desire to use it. To the tenant it is immaterial in what way the area which is taken from the farm is utilised. The loss which he suffers arises from his being deprived of the occupation, and while this may involve a certain hardship—which he did not contemplate when he entered into the lease—it was one of the risks which he contracted to take.

I am therefore of opinion that both questions of law must be answered in the affirmative; and I would only add that, even if I had come to a different conclusion as regards the second, I can see no ground whatever why the Commissioners should not resume lands necessary for making the road referred to in the first question, as express power is, by the lease, conferred upon them of doing so.

The LORD PRESIDENT was absent at the hearing.

LORD M'LAREN was absent.

[1910] SC 531

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