Ps contracted the bailee to convey their goods and allowed them to sub-bail under any terms. The bailee sub-bailed to D with an exclusive jurisdiction to Taiwan. When D’s ship sunk, P wanted to sue them in Hong Kong. Privy Council ruled that the action in HK would be stayed since P was bound by the terms of the sub-bailment. General propositions: A sub-bailee owes the same duty to take care as does a bailee for reward and when sub-bailee is in breach of this, the bailor can pursue him directly. However, where sub-bailment agreement is agreed to by bailor, the terms of it can be invoked by the sub-bailee and bailor is bound by them.
