Background:
Catherwood Towing Ltd. entered into a Barging and Towing Services Agreement with Lehigh Hanson Materials Limited. During towing operations, Lehigh’s barge grounded twice, causing damage. Catherwood conceded negligence but argued that Lehigh’s obligation to obtain Hull and Machinery (H&M) Insurance relieved it of liability for the losses.

Legal Issues:

1. Interpretation of Contract: The core issue was whether Lehigh’s covenant to insure its barges (Article 9.2(c)) provided Catherwood with immunity from claims for damages caused by Catherwood’s negligence, despite Article 7.3, which made Catherwood responsible for such damages.
2. Counterclaims: Catherwood sought solicitor and client costs, arguing that Lehigh breached the agreement by pursuing the claims, contrary to the insurance covenant.
3. Applicable Law: The case involved interpreting provisions of the Marine Liability Act, which capped Catherwood’s liability at $500,000 per incident.

Judgment:
The Court dismissed the appeals and cross-appeals. It upheld the trial judge’s conclusion that Lehigh’s covenant to insure superseded Catherwood’s responsibility under Article 7.3, relieving Catherwood of liability for the barge damage. The Court also dismissed Catherwood’s claim for indemnity costs, finding no breach of the agreement by Lehigh.

Award:
There was no monetary award or costs granted in favor of either party, as both appeals were dismissed.