Plaintiff sued defendants for short-delivery of goods carried by sea. There was a charter-party between the owners of the carrying vessel and the de¬fendants as time charterers which was not incorporated in the Bill of Lading issued by defendants but the Bill of Lading stipulated that the vessel owner or charterer by demise shall be liable as principal and not the issuer of the bill.

The plaintiff as holder of notice of the principal's existence failed to ascertain the vessel's real owner or demise charterer.

The trial court held that the defendant is a proper party and can be sued. The defendant appealed to the Court of Appeal.

The Court held that the defendant could not be sued. The plaintiff appealed to the Supreme Court.