This case concerned the grounding of the SS Oak Hill in the St Lawrence River on 25 August 1962, and the subsequent damage to cargo during unloading and reloading operations at Quebec. The plaintiff cargo owner of pig-iron claimed damages against the defendants, the shipowners and carriers. The defendants sought to rely on the charterparty exception for errors in navigation and argued that any damage during unloading/reloading was part of a general average procedure conducted by independent surveyors, which purportedly absolved them of liability. Evidence showed that the grounding occurred on the wrong side of buoy no 8712, outside the navigation channel, during a clear night, indicating a serious error of navigation by pilot Brochu, who was subsequently found unfit to pilot ships by the Minister of Transport and had his license suspended.

Held: Judgment in favour of the plaintiff.

The grounding of the SS Oak Hill was caused by a serious error of navigation by the pilot, which fulfilled the exception clause in the charterparty. However, the subsequent damage to the cargo during unloading and reloading at Quebec was found to result from the negligence of the surveyors, as well as the master and crew of the vessel. Consequently, the defendants could not claim immunity under either the York-Antwerp Rules or the charterparty.

Noel J: In view of the negligent and faulty manner in which the reloading of the cargo took place in Quebec, as established by the two Italian surveyors and experts of the defendants, and the somewhat detached attitude of the master of the vessel during the operations, as there is nothing to even suggest that the surveyors were told by the master or the shipowners of the importance of not mixing the pig-iron, the defendants cannot say that they have, as carrier of this cargo, properly and safely carried and taken care of it so as to ensure that it would safely and separately reach its destination. This loss or damage was not a direct consequence of the general average act declared herein, but even if because of r 12 of the York-Antwerp Rules 1950 it should be accepted as 'Damage to or loss of cargo ... caused in the act of handling ... storing, reloading and stowing', it resulted from the joint fault and negligent actions or omissions of both the surveyors and the master of the Oak Hill, for which fault and neglect the defendants, as carriers, hold no immunity. They have no immunity under the York-Antwerp Rules as this is not a general average claim (and even if it was the plaintiff would still have its remedy) and they have no immunity under the charterparty because the loss did not result from an error of navigation or neglect in the navigation of the ship in the ordinary course of the voyage within the meaning of the exceptions. The damage here was indeed caused by the combined acts of negligence of the surveyors and of the master and officers and crew in the management of the cargo at a time when the ship was not navigating but was moored in dock, where it remained during the whole operation of unloading and reloading. These acts of neglect, even if committed during the general average procedure, cannot be held as those of the plaintiff so as to prevent the latter from successfully recovering the damages to its cargo.