author: THOMAS, District Judge.

text:
    RABE et al. v. DANAHER.
    No. 3411.
    District Court, D. Connecticut
    May 4, 1931.
    Allan K. Smith, of Hartford, Conn., for plaintiffs.
    Francis R. Danaher, of Meriden, Conn., for defendant.
   THOMAS, District Judge.

In two counts the complaint alleges that on October 23 and 24, 1929, the plaintiffo agreed to sell and the defendant agreed to buy certain shares of stock of the value of over $100,000; that the plaintiffs delivered made repeated promises to pay these drafts,, attached, in accordance with the terms of the agreements; that although the defendant made repeated promisesto pay these drafts, he has failed to do so; that the defendant gave to the plaintiffs on November 1, 1929,. a check for a part of the purchase priee,. which check was later protested for nonpayment; that thereafter, having notified the defendant of their intention so to do in the event of nonpayment before December 2, 1929, the plaintiffs sold said stock for the account of the defendant at a loss of over $40,-000.

Upon the defendant’s motion for a more specific statement, the complaint was amplified by setting forth: (1) That the defendant gave nothing to bind the agreement or in part payment thereof; (2) the bank having notified the defendant of the arrival of the stock certificates and drafts, and the defendant having failed to pay the drafts, the certificates and drafts, after remaining at the bank for about three weeks, were returned to the plaintiffs.

Thereafter, upon motion of the defendant for oyer in accordance with section 190 of the rules under the Connecticut Practice Act (Practice Book Conn. 1922, p. 287), this court ordered that the plaintiffs file copies of the agreements alleged, if in writing. No such copies were filed, and under the rule referred to the agreements are to be deemed to rest in parol and no evidence of their having been in writing may be received.

In response to a further motion for oyer, the plaintiffs filed a copy of the'notice to the defendant of their intention to sell the stock for his account if payment was not made before December 2, 1929. This notice stated, in part, that the plaintiffs would exercise their right of lien on the stock and resell it for the defendant’s account.

To the complaint, as thus amplified, the defendant has demurred on the ground that the plaintiffs have failed to show compliance with the Statute of Frauds applicable to the .transactions alleged in the complaint.

Section 6131 of the General Statutes of ■Connecticut, Revision of 1918, now section .5983 of the Revision of 1930, provides:

“Sale of Personal Property. A contract •to. sell or a sale of any goods or ehoses in action of the value of one hundred dollars or ■upwards shall not be enforceable, by action ¡unless the buyer shall accept part of the goods •or ehoses in action so contracted to be sold or sold, and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract or sale be signed by the party to be charged or his: agent in that behalf. The provisions of this section apply to every such contract or sale, • notwithstanding that the goods may be intended to be delivered at some future time, or may not at the time of such contract or sale be actually made, procured or provided, or fit or ready for delivery, or some act may be requisite for the making or completing thereof, or rendering the same fit for delivery ; but, if the goods are to be manufactured by the seller especially for the buyer and are not suitable for sale to others in the ordinary course of the seller’s business, the provisions of this section shall not apply. There is an acceptance of goods within the meaning of this section when the buyer, either before or after delivery of the goods, expresses by words or conduct his assent to becoming the owner of those specific goods.”

It was held in Goodwin v. Mariners’ Savings Bank, 99 Conn. 169, 121 A. 172, that a contract for the sale of shares of stock is within the provisions of this statute.

In view of the plaintiffs’ failure to file any written memorandum of either or both, of the alleged agreements, in response to the motion and order for oyer, the agreements must be deemed to be oral. Rules under the Practice Act, §' 190 (Practice Book Conn. 1922, p. 287).

Nothing was given by the defendant in earnest or in part payment. This appears independently of the specific allegation to that effect in the plaintiffs’ more specific statement. The protested cheek cannot be considered as part payment, since the plaintiffs did not so receive it. Had the plaintiffs intended to consider the check itself a part payment, the defendant would be credited with its amount; the plaintiffs retaining their remedy for enforcing its payment. This court had occasion to consider this questior. in Central Trust Co. v, Cassidy, 300 F. 386, where it was held that the question as to whether or not a payment has been made is largely a question of the intention of the parties. See, also, Ketchum v. Duncan, 96 U. S. 659, 24 L. Ed. 868. It is clear from the allegations of the plaintiffs’ pleading that they did not intend the acceptance of the cheek to operate as an acceptance of part payment.

There remains to be considered the question as to whether the plaintiffs’ pleadings show that the defendant accepted part of the stock and actually received the same within the meaning of the statute quoted supra. Devine v. Warner, 75 Conn. 375, 53 A. 782, 96 Am. St. Rep. 211.

It was held in that ease, as appears on page 379 of 75 Conn., 53 A. 782, that in order to establish a cause of action under this provision of the statute the plaintiffs would have to show facts permitting an affirmative answer to each of the three following questions, to wit:

(1) Was there an agreement of sale and purchase?

(2) Did the seller, pursuant to the agreement, part with and the buyer receive the possession and Control of the stock?

(3) Did the buyer, either before or after the receipt of the* stock, accept it as that purchased ?

The statute provides that there may be an acceptance either before or after receipt of goods by an expression by the buyer of his assent to becoming the owner of the specific goods. It is possible that the plaintiffs could prove under their complaint that there was such acceptance in this ease.

There is, however, nothing in the complaint which permits an affirmative answer to the second question. Tins is so, despite the principle that there may be an actual receipt of goods without a manual delivery or change of custody, as in eases where the vendee designates the vendor as custodian by bailment. The delivery of the stock certificates to the bank, sight drafts attached, was a delivery to the plaintiffs’ own agent. Klein v. Munson, 111 Conn. 709, 151 A. 177. The plaintiffs retained actual possession and control of the stock certificates and a lien for the price, and the defendant at no time had the right of possession. The following quotation from Devine v. Warner, supra, at page 380 of 75 Conn., 53 A. 782, 784, conclusively demonstrates that, upon the facts alleged in the' amplified complaint, there must be a negative answer to the second question: “The jury should have been told that, as a receipt implies a delivery, there must have been a delivery by the vendor and receipt by the vendee of the tobacco, with an intention on the part of the parties to vest in the vendee the possession and right of possession, and discharged of all lien for the price, and an actual acceptance by the vendee of the tobacco, at least as the goods purchased, if not as its owner by virtue of the purchase. Morton v. Tibbett, 15 Q. B. 428; Hinchman v. Lincoln, 124 U. S. 38, 8 S. Ct. 369, 31 L. Ed. 337; Safford v. McDonough, 120 Mass. 290; Marsh v. Rouse, 44 N. Y. 643; Bailey v. Ogden, 3 Johns. [N. Y.] 399, 3 Am. Dec. 509; Messer v. Woodman, 22 N. H. 172, 182, 53 Am. Dec. 241. They should have been told that the statute requires something more by way of proof of a receipt and acceptance than mere words, indicative merely of the parties’ assent to the agreement of sale, and that it was not even enough to satisfy the condition of receipt that the title to the tobacco had become vested in the purchaser. Meehem, Sales, §§ 377, 383; Crug v. Gorham, 74 Conn. 541, 51 A. 519; Meade v. Smith, 16 Conn. 346.”

Hinchman v. Lincoln, 124 U. S. 38, 8 S. Ct. 369, 31 L. Ed. 337, cited in the above quotation, fully supports the principle for which it is cited.

No facts could be proved which would establish a cause of action under the amplified complaint, and so it necessarily follows that the demurrer must be sustained. Submit order accordingly.


source: Caselaw Access Project

author: PATTERSON, District Judge.

license: Public Domain

text:
    THE FRED E. HASLER. PROCTOR & GAMBLE CO. v. ATLANTIC OIL TRANSIT CORPORATION.
    District Court, S. D. New York.

    April 27, 1931.
    May 1, 1931.

      Haight, Smith, Griffin & Deming, of New York City (Charles S. Haight and Wharton Poor, both of New York City, of counsel), for libelant.
    Burlingham, Veeder, Fearey, Clark & Hupper, of New York City (Chauncey I. Clark, Eugene Underwood, and Adrian J. O’Kane, all of New York City, of counsel), for respondent.
   PATTERSON, District Judge.

Suit is brought to recover the value of a cargo of whale oil lost through the sinking of the tank barge Hasler. The libelant had chartered the Hasler from the respondent tp take a cargo of whale oil from the steamer Sir James Clark Ross which lay at Pier 6, .Staten Island, to Port Ivory on Staten Island. The Hasler was in charge of one Va-lerio, a man in the owner’s employ. The pumping of the oil from the Ross into the Hasler commenced shortly after noon on April 15, 1929, and was finished shortly before midnight, when the bargee signified that the Hasler had a load. It then had freeboard of about six inches in the middle and two feet on the ends. A violent storm came up in the early morning of the 16th, which prevented moving the barge. It sank about 5 a. m., while still lying alongside the Ross, bow end inshore, ..and the oil was practically a total • loss. The libelant brought suit on contract against the barge in rem and the owner in personam, alleging unseaworthiness.

• The Hasler was a steel barge, two hundred feet long by thirty six feet wide, with eight tanks. Each tank had two hatches and two gooseneck vents and was connected with the other tanks by equalizing valves. To furnish buoyancy, it had forepeak and after-peak compartments, each with two hatches. It is beyond controversy that the barge was in good condition at the time, so far as structure and equipment were concerned. When such a barge has its hatch covers securely fastened, it is practically unsinkable, even when the tanks are filled with oil; indeed, it is common to see barges of this type being towed around the harbor with decks awash.

The libelant’s theory of the sinking is that the hatch covers on the peak compartments and others as well had not been securely fastened, if fastened at all. The force of the waves during the storm would then move the covers and the compartments would fill with water. ,With the compartments full of water, the barge would have no buoyancy and would sink. This theory is supported both by evidence of a satisfactory character and by the probabilities of the ease; On the day after the sinking, two divers examined the Hasler as it rested on bottom. Their mission was to save the oil by plugging the gooseneck vents and making certain that the hatch covers were tight. They testified to finding one of the forepeak hatch covers off and several of the hatch covers on the tanks off or loose. They did not examine the afterpeak hatches. When the barge was raised on the 21st, four marine surveyors, including a representative of the owner, were present. All of them said that as the barge broke water they noticed that the afterpeak hatch covers were not in place. When the barge was examined in dry dock the next day, no damage could be found other than a crack on the deck which probably developed in the course of lifting the barge from the bottom. The hatch covers and fastenings were in good order. The only testimony in contradiction of this theory is that of the bargee who said that he had securely fastened all the hatches. At the trial it was suggested by the respondent that the hatch covers might have been loosened by the violent pounding of the waves upon the deck. The opinion of the expert witnesses was that this could not have happened with covers fastened securely at the outset, there having been no hateh breakages visible afterwards.

The respondent also put forward the theory that the barge was pushed down by the weight of the water on the deck. It is true that the barge was boxed in by the Ross and by other craft with higher freeboard and doubtless its stem got the full vigor of the waves, but the theory is an impossible one. The deck was a flat one, without sides. With hatches properly covered, the barge had buoyancy and would rise again. The, water could not remain in piles or heaps upon the deck. In its brief, the respondent advances a third proposition, that water was forced through'the gooseneck vents. While more plausible than the others, this theory is also untenable. The openings on these curved pipes were over a foot above the deck, and their diameter was only five and one-half inches. Some water undoubtedly did enter the tanks through the pipes, but they could not have taken water fast enough to put the vessel into a sinking condition in two or three hours. The argument assumes that water was rushing into the tanks in sufficient volume, not only to fill them, but to displace and force out a large quantity of the lighter oil; only in this way could the barge have gone down, for the peak compartments had no vents and the air in them furnished enough buoyancy to permit the flow of water into the tanks so as to fill them without any sinking. And of course this theory utterly disregards the testimony given by the divers and by the Witnesses who saw the barge being raised.

Several witnesses for the respondent called the storm one of unprecedented violence, and stated that conditions in the vicinity of Pier 6 were very bad as early as midnight. Prom other evidence, however, it seems to me that the wind and waves, while unusually high, were by no means the worst on record, and that their force did not seriously affect this barge until after 3 o'clock on the morning of the 16th. It was not until about 3:40 that the bargee became alarmed and reported that the Hasler might go adrift and blow further into the slip. An hour later he reported that it was sinking. Upon the entire case, the most reasonable conclusion from the evidence is that some of the hatch covers were not fastened, and that the sinking was attributable to this fact. This omission was of course negligent on the part of the bargee, who appears also to have been negligent in not having summoned help from the neighboring vessels in an effort to save the barge.

Was the barge thus rendered unseaworthy, and was there a breach of any warranty of seaworthiness? The suit is not based upon mere negligence- on the part of the bargee. The libel charges that under the charter the respondent warranted the seaworthiness of the Hasler, that the Hasler was in fact unseaworthy, and that the loss of the cargo resulted from such breach of warranty. The libelant, doubtless with an eye to the limitation of liability aspect of the matter which may come up at a subsequent stage, has seen fit to plead and to try the case as one involving breach of warranty by the respondent. Ur. less such a breach can be established, the libel must be dismissed.

The charter in this case was oral, and there was an implied warranty by the owner that the barge was seaworthy. The Edwin I. Morrison, 153 U. S. 199, 210, 14 S. Ct. 823, 38 L. Ed. 688; Oxford Paper Co. v. The Nidarholm, 282 U. S. 681, 51 S. Ct. 266, 75 L. Ed. 614, 1931 A. M. C. 522, 524, decided by the Supreme Court February 24,1931; Poor on Charter Parties, § 3. The test of seaworthiness is whether the vessel is reasonably fit to carry the cargo undertaken to be carried. The Sagamore (C. C. A.) 300 F. 701, 703. “Seaworthiness” is given a wider application than the word itself imports. The Newport (C. C. A.) 7 F.(2d) 452, The first thing one thinks of in connection with seaworthiness is the condition of the hull and the equipment; but it has long been settled that a vessel may also be rendered unseaworthy because of bad stowage.' Oxford Paper Co. v. The Nidarholm, supra; Olsen v. United States Shipping Co. (C. C. A.) 213 F. 18. Unseaworthiness may also result from careless use of good equipment before the vessel breaks ground. The warranty calls for “due diligence on the part of all the owner’s servants in the use of the equipment, before the commencement of the voyage.” International Navigation Co. v. Farr & Bailey Mfg. Co., 181 U. S. 218, 225, 21 S. Ct. 591, 593, 45 L. Ed. 830. See also The Newport, supra; The President Polk (C. C. A.) 43 F.(2d) 695. It seems clear, therefore, that a tank barge so laden that it has only two feet freeboard is not seaworthy where its hatches are not securely fastened when the vessel' is ready to sail. A tank barge light is doubtless seaworthy with hatches left open, but the same cannot be said of a loaded barge. In this case the unseaworthiness is attributable to the owner, for the bargee remained its representative so far as the care of the barge and its internal economy are concerned, notwithstanding that the charter was a demise of the barge. Dailey v. Carroll (C. C. A.) 248 F. 466; The Junior (C. C. A.) 279 F. 407.

But it is urged that there was no breach of warranty, because the implied warranty of seaworthiness, it is said, is narrowly limited as to time. No one will dispute that ordinarily there is no implied warranty that a vessel will continue seaworthy after commencement of the voyage. The Steel Navigator (C. C. A.) 23 F.(2d) 590. It is said in Carver on Carriage by Sea, § 21, that the warranty of seaworthiness is a double one, “viz., that the ship shall be fit to receive the cargo when receiving it, and shall be fit to sail at the time of sailing”; and that “the warranty of fitness to receive the cargo is not a continuing warranty after the goods are put on board; the warranty is that at the time the goods are put on board the ship is then fit to receive them and encounter the ordinary perils during the loading stage.” McFadden v. Blue Star Line, [1905] 1 K. B. 697, supports the above statement by Carver. The owner’s argument is that neither branch of the warranty was broken; the first was not broken because the barge was fit to receive the oil when it was loaded, and the second was not broken because the barge never left its mooring. There are indications, however, that the warranties are not so momentary, that on the contrary there is a general warranty of seaworthiness that continues in operation from the commencement of loading until the breaking of ground. The Eugene Vesta (D. C.) 28 F. 762; Bowring v. Thebaud (C. C. A.) 56 F. 520, 523-525; The Caledonia, 157 U. S. 124, 132, 15 S. Ct. 537, 39 L. Ed. 644; compare Reed v. Page, [1927] 1 K. B. 743. But even if the statement by Carver be taken as sound, I think that there was a breach of the implied warranty. The loading of the oil into the barge was not completed, in my opinion, until the hatches were fastened. Their fastening belonged to the loading stage. The barge with loose hatches was not in fit condition to receive the cargo when receiving it. The owner’s contention that the first branch of the double warranty relates only to the ship’s condition “when loading begins” is an undue restriction upon the statement by Carver for which I cannot find any authority. Any such rule would exempt an owner in a ease of unseaworthiness caused by overloading, where the vessel sank prior to commencement of the voyage. It cannot be the law.

As for the damages, I am satisfied that the cargo on board amounted to 1,522.5 tons of oil. The value of this tonnage, at $147.70 a ton, was $224,873.25. There was a salvage of oil worth $8,220.73. The loss was therefore $216,652.52, for which the libelant may have a decree against the barge and against the respondent.

Memorandum.

I will withdraw the finding as to the amount of the libelant’s damages and will sign an interlocutory decree, referring the matter of damages to a commissioner.


author: COOPER, District Judge.

text:
    THE A. S. SHERMAN.
    District Court, N. D. New York.
    Nov. 7, 1930.
    George E. O’Connor, of Waterford, N. Y., for libelant.
    James Farrell, of Troy, N. Y., for respondent.
   COOPER, District Judge.

This is a libel filed May 2, 1928, against the steam tug A. S. Sherman for coal delivered to it at Waterford, N. Y., in September, October, and November, 1927.

On July 16, 1927, the tug was chartered by its owners under a bare boat charter to the Independent Barge Canal Towing Company of Buffalo for the season of 1927 which ended about December 20th. The charter was brief and simple and required the charterer to pay all operating expenses and to furnish all fuel, supplies, wages of crew, etc.

The word “lien” was not mentioned in the charter, and there were no words therein forbidding the charterer from procuring necessaries on the credit of the tug.

Captain Herman Frantz, a half owner of the tug, was employed by the charterers as captain or master at a wage independent of the charter hire.

At or about the time of the charter, Captain Frantz told Frank M. Crane, the president of the libelant, the Peck Coal Company of Cohoes, N. Y., with whom he was well acquainted and had had many business transactions, that he had chartered the- tug as a bare boat to-the Independent Towing Company, and that he (Frantz) was employed by the charterer as captain of the tug. Frantz further said that the Peek Company was to coal the tug and send the bills therefor to the charterer at its main office at Buffalo, No further inquiry about the charter was ever made by Crane.

Crane testified that he told Frantz that he would only sell the coal on the credit of the tug. This Frantz flatly denies. Eighteen deliveries of coal were made to the tug between July 16th and November 25th. The bills were all sent to the charterer, and no bills were sent to the owners.

The charterers paid for eight deliveries of coal on July 16, 21, 26, August 2, 4, 6, 9, and 19.

For coal delivered on ten occasions after August no payment has been made and libel is for the value of these ten deliveries made on September 1, 5, 9, 19, 26, October 6, 22, November 1, 17, 25, amounting to $1,114.75.

It is undisputed that coal in the amount specified in the libel was actually delivered to the tug, that the price indicated in the libel is the agreed or market price, that such price remains unpaid, and that the coal was necessary to the operation of the tug.

The Peek Coal Company furnished coal to other tugs operated by the Independent Company prior to and after July 16th, but whether on the credit of the boats or the charterer does not appear by the evidence, but the bills were likewise sent to the charterer and all amounts paid therefor were paid by the charterer as far as appears by the record.

There is a sharp issue of fact as to whether these 18 deliveries of coal were made on the order of Captain Frantz, the master of the tug, or of Frank H. Godfrey, the agent of the charterer at Waterford, who was in charge of the movement of this and other tugs of the charterer and one of whose duties was to procure fuel and supplies for the tugs. Crane and his bookkeeper, Miss Anna A. O’Connor, testify that Captain Frantz personally ordered all the coal, usually over the telephone. Godfrey, no longer in the employ of the charterer, which because of financial difficulties ceased business in 1927, who was also well known to Crane, testified that he personally ordered the coal over the phone, except possibly on one or two occasions when he believes his wife ordered it. His wife was not sworn. Frantz testified positively that he ordered no coal after the charter was entered into, and that he frequently heard Godfrey order the coal over the phone.

Slips were made out in triplicate with, each delivery of coal. Two accompanied the load. One was signed by the person in charge of the boat and returned to the coal office. One was delivered with the coal to the person in charge of the tug, and the third slip remained in the coal office. Most of the signed delivery slips were signed by Captain Frantz himself. All of the signed slips for delivery of coal in July and August bore the words “Tug Sherman and owners.” None of the signed delivery slips dated after August originally bore the words “and owners,” but contained merely the words “Tug Sherman.” After the return of the signed delivery slips to the coal office, Crane added the words “and owners” on the signed slips for September 1, 5, 9, 18, 26, and October 6. But these words “and owners” were not on the duplicate slips delivered with the coal to the tug, and, of course, never came to the attention of claimants. Crane went to a hospital October 16, 1927, and had no further personal connection with any of the transactions.

Bills were sent to the charterer shortly after each shipment and each of these bills for delivery made in July and August contained the words “Tug Sherman and owners,” but these bills never came to the attention of Captain Frantz or the other owner of the tug.

Some time in August, according to Crane, Frantz objected to the tug being-held for the coal, but be signed tbe slip. Frantz does not deny objecting to the tug being held liable for the coal, but denies that he ever saw the words “and owners” on any slips.

About September 1,1927 or shortly thereafter, perhaps September 6 or 7, Frantz and Crane had a further talk about the charterer’s financial responsibility which has a bearing chiefly on the subject of waiver and is referred to under that subject.

The libelants sent statements to the charterers on the first of each month for coal- supplied to the various, tugs during the preceding month, among which were included the coal delivered to the. Sherman. The bills for coal delivery on September 1, 5, and 18 contained the words “Tug Sherman and owners.” All the remainder of the bills read “Tug Sherman” only. The monthly bills dated December 1, 1927 and January 1, 1928, contained a rubber stamp request for payment.

No further communications passed between the libelants and either the charterers or owners, and on May 2, 1928, the boat was taken under the libel and released on bond.

The claimant-respondent contends that no lien lies, for the reason that the coal was not ordered by the master of the tug, but by an agent of the charterer; that, even if ordered by'the master, he had no authority to bind the vessel, and that, in any event, if any lien did arise, the libelant waived the lien and held only the charterer for the coal. The statute controlling here is found in sections 971-974, 46 USCA.

Section 971 declares that a maritime lien shall exist for necessaries furnished to the ship/

Sections 972 and 973 read as follows:

“§ 972. Persons authorized to procure repairs, supplies, and necessaries. The following persons shall be presumed to have authority from the owner to procure repairs, supplies, towage, use of dry dock or marine railway, and other necessaries for the vessel: The managing owner, ship’s husband, master, or any person to whom the management of the vessel at the port of supply is intrusted. No person tortiously or unlawfully in possession or charge 6f a vessel shall have authority to bind the vessel.
“§ 973. Notice to person furnishing repairs, supplies, and necessaries. The officers and agents of a vessel specified in subsection Q, section 972, shall be taken to include such officers and agents when appointed by a charterer, by an owner pro hac vice, or by an agreed purchaser in possession of the vessel; but nothing in this chapter shall be construed to confer a lien when the fur-nisher knew, or by exercise of reasonable diligence could have ascertained, that because of the terms of a charter party, agreement for sale of the vessel, or for any other reason, the person ordering the repairs, supplies, or other necessaries, was without authority to bind the vessel therefor.”

The libellant unquestionably knew that the tug Sherman was under charter to the Independent Towing Company. Having been told that it was a bare boat charter, and having made no further inquiry as to the terms thereof, it must be held-that the libelant is bound by the terms of' the charter, which he might have ascertained by due inquiry. U. S. v. Carver, 260 U. S. 482, 43 S. Ct. 181, 67 L. Ed. 361.

The' primary question is whether, by the "terms of the charter, the libelant had a maritime lién under the statute for the coal furnished. to" this tug, whether the coal was ordered by the master of the tug or by an agent of the charterer claimed to have the management of the tug in the port at which the coal was obtained and to be one of the ship’s representatives named in sections 972 and 973 of the statute.

The charter provided that the charterer should procure coal and other supplies. There is no mention of lien in the charter and no prohibition against a lien and no provision for the removal of liens by the charterer. As far as the charter is concerned, the duty was on the charterer to procure and pay for the coal for the tug. If the charter provision that the charterer should furnish the coal is' equivalent to a prohibition against the charterer doing anything by which a lien could be imposed on the tug or is equivalent to a withholding of power to bind the boat, the claimant must prevail. But if it is not such equivalent, the libelant should prevail unless it has waived the lien which is discussed later herein.

The authorities are not agreed on the application of the statute to such a charter as the one in suit. The better authorities, however, seem to hold that one who furnishes necessaries to the tug ordered by one of the persons named in the statute has a maritime lien on the boat unless the charter, by the terms of which he is bound, if he fails to make inquiry, definitely and affirmatively prohibits the authority of the charterer, to procure necessaries upon the credit of. the boat. The South Coast, 251 U. S. 519, 40 S. Ct. 233, 64 L. Ed. 386.

The facts in this case axe best shown by the opinion in the Circuit Court of Appeals of the Ninth Circuit (247 F. 84). The salient provisions of the charter party were as follows: “Eifth. It is understood that this chatter is a charter of the bare vessel, and that said party of the second part [the charterer] shall furnish the crew, pay their wages, victual them, furnish all deck and engine room and saloon stores and supplies of every kind and nature, pay for all fuel * * *' and pay all other charges whatsoever of every nature * , * * that may be incurred in or about the use of said vessel during the term of this charter.”

By the sixth paragraph the owner is accorded the right to appoint the master, who is to be under the orders of the charterer as to management of the ship and whose wages axe to be paid by the charterer. The charter also provided that on default in the payment of charter hire, or failure to discharge all liens within thirty days and at the^ expiration of the charter, the charterer would deliver the boats to the owners “free from all liens and claims of every kind or description * * * except the lien for any salvage services.”

The owners, fearing that supplies would be furnished upon the credit of the vessel, notified the furnisher of the supplies that the steamer was under charter, and that he must not furnish supplies upon the credit of the vessel. The coal was supplied upon the order of the master of the boat acting under the order of the charterers. The lien on the vessel for fuel was allowed by the District Court and affirmed by the Circuit Court of Appeals. . The Circuit Court of Appeals said: “It is the purpose of the statute, as it was the purpose of the law previous thereto, that the furnisher of such commodities as are necessary to enable a ship to enter upon or pursue her voyage, and to engage in maritime traffic, to which only she is adapted, shall have a lien on the ship therefor. It is in the interest of shipping, conducted upon maritime waters, that such should be the ease, as otherwise credit would not be extended, upon the account of the owner or master alone, to enable the ship to discharge its peculiar function, and great inconvenience would follow, to the detriment and disadvantage, if not the ultimate disaster in large measure, of maritime shipping. Many ships sail under charter, either verbal or in form of regularly drawn charter parties, and it is usual and customary for the charterer in either event to disburse the necessary expenses of the ship; and of this all persons furnishing supplies, etc., to a chartered ship must be deemed to have notice. But notwithstanding this notice, or even knowledge that the ship is under charter, we cannot believe that it was the in-tendment of the statute or of the law that the furnisher should, because of that fact, be deprived of his lien when advancing necessary repairs or supplies in good, faith to enable the ship to engage in her accustomed traffic. Nor do we believe that it was the intendment of the statute or of the law thus to impose so vital a hindrance upon maritime shipping, and unless there is something more in the charter party, that unalterably inhibits the master or the charterer from incurring any expenditures on the credit of the ship that may become a lien thereon, the master’s ordinary authority is not impaired or abbreviated; nor can the right of the furnisher of repairs, etc., to extend credit to the ship, and his consequent lien, be so subverted.”

When this ease came to the Supreme Court of the United States, that court said, in affirming the decree: “By the Act of June 23, 1910, e. 373, § 1, 36 Stat. 604, a maritime lien is given for such supplies and by section 3 a presumption is declared that a master appointed by a charterer has authority from the owner to procure them. It is true that the act goes on that nothing in it shall be considered to give a lien where the furnisher knew, or by the exercise of reasonable diligence could have ascertained, that because of the terms of a charter party, or for any other reason, the person ordering the necessaries was without authority to bind the vessel. But the authority of the owner to prohibit or to speak was displaced, so far as the charter went, by that conferred upon the charterers, who became owners pro hac vice, and therefore, unless the charter excluded the master’s power, the owner could not forbid its use. The charter party recognizes that liens may be imposed by the charterers and allowed to stand for less than a month and there seems tó be no sufficient reason for supposing the words not to refer to all the ordinary maritime liens recognized by the law.- The statute had given a lien for supplies in a domestic port and therefore had made that one of these ordinary liens. Therefore the charterer was assumed to have power to authorize the master to impose a lien in a domestic port, and if the assumption expressed- in words was not equivalent to a grant of power, at least it cannot be taken to have excluded it. There was nothing from which the furnisher could have ascertained that the master did not have power to bind the ship.”

It will be seen that the charter and the facts are very similar to- those in the case at bar, except that the charter here is silent on the question of liens, while in The South Coast the charter provided for the prompt removal of lien. In several of the Circuit-Courts of Appeals decisions since The South Coast, that case has been followed and interpreted as holding that a lien for necessaries arises unless the charter prohibits the charterer from binding the boat.

In The Portland, 273 F. 401, 404 (C. C. A. 9, 1921), the charter required the charterer to supply the fuel for the ships. The libel-ant furnished supplies on the order of the charterer. In holding the oil merchant entitled to a lien, the court, in the Ninth Circuit, interpreted the South Coast Case as follows: “The real ground for the ruling in The South Coast was that the supplies were furnished on orders from the master, and the master had the power to impose a lien unless the charter party excluded the possession of such power.”

The Anna E. Morse, 286 F. 794 (C. C. A. 3, 1922), certiorari denied 262 U. S. 759, 43 S. Ct. 705, 67 L. Ed. 1219. In that case the company in possession of and operating the boats agreed to provide and' pay for all supplies, etc. The fuel was ordered by the company operating the boats. In allowing the lien for the fuel, the court said in part:

“Under Merchant Marine Act June 5, 1920, § 30, subsees. P-T, the law -presumes that one intrusted with a ship has the owner’s authority to procure supplies on the pledge of the ship, unless the owner had withheld his authority and the furnisher knew it, or by diligence could have ascertained it. * * *
“A contract between the Emergency Fleet Corporation and an agent for the operation of the ships, requiring the agent to provide and pay for all provisions, equipment, and supplies, and perform all customary duties of managing and operating owner, but containing no provision withholding authority to procure supplies on the credit of the ships, was insufficient to defeat the authority presumed by law to order supplies on such credit under Merchant Marine Act June 5, 1920, § 30, suhsecs. Q and R.”

These sections are now sections 971 to 975 of title 46, USCA.

In The Penza, 9 F.(2d) 527 (C C. A. 2, 1925), the charter provided that the charterer should pay for necessaries. The charter also provided, “ 'although appointed by the owners, the captain shall be under the order and direction of the charterers as regards employment, agency, or other arrangement,’ ” but there was no express prohibition of the master’s power of procuring necessaries upon the credit of his ship. The court upheld a libel for coal, fuel, and supplies furnished the boat at the order of the master of the ship. The court said:

“But by the terms of the charter party there was no express prohibition upon the master to obtain necessaries, and coal and food certainly come within that category, upon the credit of the vessel. It is quite true that the owners hoped it .would not be necessary for the master to go to such lengths to get what he had to have, and they did contract with the charterers to provide the same, but there was no prohibition on the power of the master, which existed before the statute and was recognized and indeed enlarged by the statute. * * *
“Thus it is seen that this master had the right to do’ what he did by traditional law and by statute, and was not prohibited from action by charter. Such a situation is plainly far within The South Coast, 251 U. S. 519, 40 S. Ct. 233, 64 L. Ed. 386, the facts in which case are best set forth in 247 F. 84, and those facts are totally different from those presented in United States v. Carver, 260 U. S. 482, 43 S. Ct. 181, 67 L. Ed. 361, where the ship was in the possession of purchasers on a partial payment agreement, who appointed the master, who ordered nothing, and both 'the partial payment owner and its master were expressly prohibited by the purchase contract from hypothecating the vessel for what the master in the ease did not order, and what the Penza’s captain did of necessity procure.
“We find no similarity between this and the Carver Case; and The South Coast only shows a set of circumstances far more difficult for the lienor than is here presented.”

It will thus be seen that the Circuit Court of Appeals in the Second, Third, and Ninth Circuits have held, since the statute of 1910 was enacted and since the South Coast Case was decided, that, where necessary supplies are ordered by the master or captain of the ship, whether appointed by the owner or the charterer, one who furnishes necessaries upon the order of the said captain is presumed to have furnished them upon the credit of the ship and to have a maritime lien upon the ship for the value of the necessaries, unless the owner has in the charter definitely prohibited the charterer from procuring the necessaries upon the credit of the vessel.

It is contended by claimant here that the ease of U. S. v. Carver, 260 U. S. 482, 43 S. Ct. 181, 67 L. Ed. 361, is decisive of this ease in favor of the claimant. The ship in the Carver Case was owned by the United States, but was in possession of a corporation under the charter by which the corporation was to pay all costs and expenses incident to the use and operation of the vessels and “will not suffer nor permit to be continued any lien, incumbrance, or charge which might have priority over the title and interest of the owner in said vessel.” It was also provided further that in any event within fifteen days the charterer would make adequate provision for the satisfaction or discharge of any claim that might have priority over the title of the owner.

The Supreme Court, in distinguishing this case from the South Coast Case, said: “But there is a sufficient difference in the language employed there and here to bring about a different result. In the South Coast, the contract went no farther than to agree to discharge liens within a month. Here the pri•mary undertaking was that ‘the charterers will not suffer nor permit to be continued any lien/ etc. We read this as meaning will not suffer any lien nor permit the same to be continued. Naturally there are provisions for the removal of the lien if in spite of the primary undertaking one is imposed or claimed. But the primary undertaking is that a lien shall not be imposed.” See, also, The Penza, supra, for distinction between the two eases.

There have been many cases since U. S. v. Carver, 260 U. S. 482, 43 S. Ct. 181, 67 L. Ed. 361, holding that no lien lies where the charter expressly forbids. But these caáes have no application here, for the charter did not expressly forbid.

There are also some cases holding that no lien lies where the charter merely required the charterer to procure and pay for necessary supplies, but does not expressly prohibit binding the boat. The other cases on which claimant relies are chiefly of this class and are as follows:

Curacao Trading Company v. Bjorge, 263 F. 693 (C. C. A. 5, 1920), certiorari denied, 253 U. S. 492, 40 S. Ct. 584, 64 L. Ed. 1028. The time charter here provided that the charterer should provide and pay for supplies. There was no prohibition against liens. The libelant was under contract with the charterers to furnish coal for all steamers of which they were owners, charterers, time charterers, or in which they were otherwise interested and furnished the coal when the vessel came to port. The coal was delivered after request of and promise by the charterers to pay for the same. The court held that there was no lien.

In Pensacola Shipping Co. v. U. S. Shiping Board et al., 277 F. 889 (C. C. A. 5, 1922) the same Circuit Court of Appeals held a like charter as excluding authority of the charterer to bind the vessel.

The Bjorge Case is followed in the Dictator, 18 F.(2d) 131 (D. C. La. 1927), a District Court case in the same circuit, where the charter provided that the charterer should pay for all coal and port charges. In this case, however, libelant was under contract with the charterer “to supply all the bunker coal that [charterer] may require * * * for the use of its steamers, * * * estimated to be the minimum of 1,500 tons, with the maximum of 6,000 tons.”

The case of The St. Johns, 273 F. 1005 (C. C. A. 4, 1921) reversed in 260 U. S. 707, 43 S. Ct. 246, 67 L. Ed. 474, without opinion, cited by claimant, has little application here. The charter probably prohibited the charterer from allowing any liens for supplies for the boat, and the ease turned upon the question of due diligence in ascertaining the terms of the charter in view of the knowledge of the libelant.

In the ease of The Princess Matoika (D. C.) 298 F. 153, affirmed 1 F.(2d) 233 (C. C. A. 2, 1924), the charter prohibited liens in exactly the same words as did the charter in U. S. v. Carver, 260 U. S. 482, 43 S. Ct. 181, 67 L. Ed. 361, and this is distinguished from the case at bar.

In The Thordis, 290 F. 255 (D. C. E. D. N. Y. 1923) the charter there as here provided merely that the charterer should pay for supplies for the vessel and did not prohibit liens. It was held that there could be no lien because the charterer was without authority to permit a lien to be imposed on the vessel.

There are some cases in other jurisdictions to the same effect, such as the Ville de Djibouti, 295 F. 869 (D. C. E. D. Pa. 1924) and the very recent ease, The Ben Lawers, 42 F.(2d) 897 (D. C. W. D. Wash. 1930).

Most of these eases have some distinguishing features, but such of them as do not seem.in epnfiiet with the Supreme Court decision in the South Coast Case. Contracting parties are presumed to contract with, full knowledge of the law.

Where, therefore, a statute declares that a lien upon a ship for necessaries furnished arises when the necessaries are ordered by a master or other person intrusted with the management thereof, who is presumed to have authority to bind the ship unless by the charter party such persons are without such authority, it is a reasonable, if not a necessary, conclusion that to overcome such presumption of authority the parties must do so by language expressly and affirmatively prohibiting authority to bind the boat.

Upon reason and authority, therefore, it should be held that a mere provision in a bare boat charter that the charterer shall pay for necessary supplies is only a contract between the parties binding along on them and not intended to have and not having the effect of prohibiting the charterer from procuring necessaries upon the credit of the boat nor the effeet of overcoming the presumption of the statute that the master or other person intrusted with the ship had authority to bind the ship for necessaries.

Having come to the conclusion that, if not waived, the libelant is entitled to a lien on the-tug if the coal was placed thereon at the order of some person so related to the tug as to be one of the persons named in the statute, it will not be necessary to decide whether the coal was ordered by Captain Frantz or Godfrey, if the status of both bring them within the statute. Clearly Captain FVantz was the master of the tug, and it matters not whether appointed by the owner or charterer. He was in fact appointed by the charterer, and his status so far as the statutory presumption that as master he had power to bind the boat for necessaries is concerned is the same as if he had no interest in the boat and was unacquainted wdth the owner.

Was Godfrey a person who was intrusted with the management of the tug at the port of Waterford within the meaning of section 972 of the statute? According to the testimony which is undisputed in this respect, he was intrusted by the charterer with the management of the tug Sherman and other tugs of the Independent Towing Company at the port of Waterford and vicinity, directed their movements, and ordered supplies and necessaries for them. It would seem as to all the tugs of the Independent Towing Company, including the Sherman, he was intrusted with the management -within the meaning of the Bection. The Penn, 273 F. 990 (C. C. A. 3); The Penn, 276 F. 118 (C. C. A. 3); El Amigo, 285 F. 868 (C. C. A. 5); The Oceana, 244 F. 80 (C. C. A. 2).

It is therefore unnecessary to decide whether the coal was ordered by Captain Frantz or Godfrey. If decision were necessary, it would be held that, considering all the circumstances and interests of the witnesses and the weakness of human memory, the coal was ordered by Godfrey and not by Frantz, at least so far as the coal delivered after August is concerned.

The claimant further insists that, if li-belant would otherwise have had a lien, it has waived its right thereto.

Claimant relies on these facts or alleged facts that the libelant knew that (1) the tug was under charter to the Independent Company; that the bills were to be sent to the charterer; the bills were sent to the charterer and not to the owner; all payments received were made by the charterer. Such demand for payment as was made was made upon the charterer; the libelant well knew the owner (Frantz) believed the charterer irresponsible; the owner Frantz expressed to libelant its doubt of the ability of the charterer to pay either the coal bill or the charter hire and masters’ wages; that it is unreasonable to suppose that the owner, being personally present, would permit coal to be supplied on the credit of the boat.

Claimant asserts that any lien based on the statutory presumption of authority of those intrusted with the management of the boat that might otherwise exist was waived by such acts and conduct. Claimants cite The Eastern, 257 F. 874 (D. C. Mass); The Millinocket, 266 F. 392 (D. C. E. D. N. Y.).

Certainly any protest against the libelant supplying coal on the credit of the boat was far less definite and vigorous than the protest in the South Coast Case where the lien was nevertheless held to lie.

In that ease the libelant refused to furnish fuel except on the credit of the boat, and Crane testifies to the same thing here, but it is denied by Frantz.

Lack of responsibility- on the part of the charterers would influence the furnisher of supplies to insist on holding a lien on the boat fully as much as it would induce the owner to insist on exempting his boat from lien.

But it is undisputed that Frantz and Crane talked about the uncertain responsibility of the charterer, and that the early bills before September 1st did contain the words “Tug Sherman and Owners,” and that some of the slips containing the same words were signed by Frantz, and duplicates thereof containing the same words were left with him. His statement that he does not remember seeing the words “and owners” on the slips is not sufficient to overcome the force of the signed slips. It is also doubtless true that Frantz protested against the slips indicating the coal was chargeable to tug and owners, but he continued to sign slips so reading.

It is undisputed that bills for coal "furnished to the tug “Sherman” were sent to the charterers at Frantz’ request or instruction. It is a reasonable inference that the sending of the bills to the charterer under the situation existing here was not intended by the libelant to be a waiver or surrender of its lien against the tug unless the bills were paid. This must be so at least as to all coal furnished before September 1,1927.

Captain Frantz testified that shortly after September 1, probably about September 6 or 7, he and Crane had a further conversation about the charterer and its financial responsibility, in which Frantz said that toward the end of the season irresponsible charterers frequently gave the debtors “a beating.” Frantz says Crane told him that he (Peek) would take a chance, as he had been paid regularly, and that he (Frantz) should take a chance. When asked what the chance was that was to be taken he (Frantz) replied that it was the payment for the coal. But at another time he said that he was worried abput his money, meaning undoubtedly his wages and charter hire. It may be of significance that, from that time on, the slips delivered with the coal did not originally bear the words “and owners,” nor did those for any deliveries after.

Peek says that such words were inserted by him on the signed slips after «the delivery of the coal and the return of the signed slips to the coal office, at least so far as five or six duplicate slips are concerned, running from September 1 to October 6. On October 16, he went to the hospital and had no further active connection -with deliveries thereafter made. The carbon copies of the bills sent by the Peek Company to the Independent Company for coal delivered to the tug after August bear the words “Tug Sherman and owners” as to the coal supplied on September 1, -5,19, but only the words “Tug Sherman” appear on the bill for coal sold September 9, :26, October 6, 22, November 1, 17, and 27. These bills were never brought to the attention of the tug owner or master and can only bind the libelant, but they were sent at the request of Frantz, who was both master of the tug and owner. On all but three the words “and owners” are lacking.

Do these things mean that after such conversation .the libelant agreed to take a chance on getting his money from the charterer and thereafter omitted the words “and owners” ? If the words “and owners” were no longer placed on any of the slips delivered with the coal after September 1, the acts and conduct of the parties seem consistent with a waiver of any lien on the boat and a willingness to rely on and take a chance on payment by the charterer.

On the other hand, the mere charging the price against the person on whose orders the necessaries were furnished does not affect the right to a lien on the boat. Nor is taking a bond for security. El Amigo, 285 F. 868 (C. C. A. 5).

One who charges waiver of lien and “holding of the charter exclusively liable has the burden of proof of establishing the waiver. The Dana (D. C.) 271 F. 356, The Hatteras (C. C. A.) 255 F. 518.

The question is whether or not there was intent to waive the lien.

The proof does not quite satisfy the court that the libelant intended to relinquish and waive a lien against the boat, though the matter is not at all free from doubt. From the fact that there was no other change of conduct of the parties except the omission of the words “and owners” from the slips delivered after September 1, that some delivery slips for coal delivered in September before September. 6 or 7, the probable date of the conversation, omitted the words “and owners,” that Crane put such words on all delivery slips returned to the office after their return for coal delivered from September 1 to October 16, the time he went to the hospital, although the claimant could have had no knowledge of his so doing, and that Crane had no connection with the coal sales after the last date, the court, not without some hesitation, is constrained to hold that claimant has not met the burden of proof of showing waiver of the lien.

Libelant has a lien on the tug for the amount claimed for which the bondsman is liable, and decree may be so entered.

Additional Opinion.

Since writing the memorandum in the above case, counsel for the libelant has asked that certain statements of fact therein be amended because ambiguous or erroneous in stating the facts accurately.

The main portion of the objection runs to the following portion of the memorandum contained on page 783: “None of the signed delivery slips dated after August originally bore the words ‘and owners’ but contained merely the words ‘Tug Sherman.’ After the return of the signed delivery slips to the coal office Crane added the words ‘and owners’ on the signed slips for September 1st, 5th, 9th, 18th, 26th and October 6th. But these words ‘and owners’ were not on the duplicate slips delivered with the coal to the tug and, of course, never came to the attention of claimants.”

It is true, as libelants contend, that Crane’s statement that he added the words “and owners” on the signed slips was limited to the slips of September 1, 9, 26, and October. 6. These were the four duplicate slips produced by Captain Frantz, the claimant of the tug. Crane did not state that he added the words “and owners” to the said slips on September 5 and 18. The duplicates of these slips were not produced by Captain Frantz and were undoubtedly forwarded to the Independent Towing Company’s office at Buffalo as the other duplicates were and as the four slips just mentioned would have been had not the routine in some way been interfered with.

Inspection of the slips of September 5 and 18 leads to the conclusion that the words “and owners” were subsequently added .on these slips as they were on the slips of September 1, 9, 26, and October 6, and the court does so find, although there is no statement to that effect by Mr. Crane.

It should also be stated that the slip of October 22 did not contain the words “Independent Towing Company,” but contained the name “Herman Frantz, Tug Sherman,” and signed as received by F. H. Godfrey. It should also be clear that none of the slips after October 16, 1927, contained the words “and owners.” It will be remembered that Crane went to the hospital on that day and the remaining transactions were handled by the clerk in charge, witness O’Connor.

       “Subsection Q,” should be omitted.


author: GODDARD, District Judge.

text:
    LLOYD ROYAL BELGE SOCIETE ANONYME v. ELTING, Collector of Customs.
    District Court, S. D. New York.
    July 22, 1931.
    Karlin, Campbell, Hickox, Keating & McGrann and Delbert M. Tibbetts, all of New York City, for plaintiff.
    George Z..Medalie, U. S. Atty., and Mor-, ton Baum, Asst. U. S. Atty., both of New York City, for defendant.
   GODDARD, District Judge.

This is a motion to dismiss the complaint for failure to state facts sufficient to constitute a cause of action.

The suit was brought for the recovery of $300, which the plaintiff paid on January 10, 1930, to the collector of customs of the port of New York under protest as a condition to granting clearance papers, for its steamship Henri Jaspar which was about to sail from New York for Antwerp. It is alleged in the complaint that the $300 was a penalty imposed on the ground of an alleged violation of section 18 of the Immigration Act of 1917 (8 USCA § 154) for having failed to detain on board the Henri Jaspar an alien passenger, one Victor Feneuil, who had been brought to the United States by the plaintiff, and who had been excluded from admission for the reason that he was a quota immigrant not in possession of a quota visa; the alien, however, having a nonquota visa, was accepted as a passenger by the steamship company; the nonquota visa had been issued by the American consul at Antwerp upon the alien’s representations that he had been a resident of the United States for a period of more than seven years and was returning to an unrelinquished domicile in this country; that, after a hearing by the Board of Inquiry at Ellis Island he was, on November 24,1929, excluded from' admission into the United States on the ground that he was a quota immigrant and had a nonquota immigrant visa, and the Commissioner of Immigration caused him to be returned to the Henri Jaspar and ordered that he be deported. It is also alleged that, notwithstanding due diligence on the part of the master of the Henri Jaspar, the alien escaped from the vessel before her departure from the port of New York. The fine of $300 was imposed upon the steamship company for its failure to detain and deport him. The complaint also contains the following allegation: “Fifth: The plaintiff was given notice of an intention to impose a fine of $1,000 and the return of passage money in the sum of $136 on the ground that the plaintiff had brought to the United States a quota immigrant not in possession of a quota visa, but upon a showing duly made to the Secretary of Labor by the plaintiff that it had accepted the said alien as a passenger on the faith of the consular non-quota visa and the representation of the alien that he had resided in the United States for more than seven years and was returning to an unre-linquished domicile, the Department of Labor declined to impose the aforesaid fine and return of passage money.”

So that it appears that the fine of $1,000 provided for under section 16 of Act 1924 (8 USCA § 216) for bringing in the alien was not imposed, but that the fine of $300 was imposed under section 18 for the steamship company’s failure to detain and deport the alien.

Section 18 of the Immigration Act of February 5, 1917, c. 29 (8 USCA § 154): “All aliens brought to this country in violation of law shall be immediately sent back, in accommodations of the same class in which they arrived, to the country whence they respectively came, on the vessels bringing them, unless in the-opinion of the Secretary of Labor immediate deportation is not practicable or proper. The cost of their maintenance while on land, as well as the expense of the return of such aliens,' shall be borne by the owner or owners of the vessels on which they respectively came. It shall be unlawful for any master, purser, person in charge, agent, •owner, or consignee of any such vessel to refuse to receive back on board thereof, or on board of any other vessel owned or operated by the same interests, such aliens; or to fail to detain them thereon; or to refuse or fail to return them in the manner aforesaid to the foreign port from which they came; or to fail to pay the cost of their maintenance while on land; or to make any charge for the return of any such alien, or to take any security for the payment of such charge; * * * and if it shall appear to the satisfaction of the Secretary of Labor that such master, purser, person in charge, agent, owner, or consignee has violated any of the f ore-,going provisions, or any of the provisions of section 151 of this title, such master, purser, person in charge, agent, owner, or consignee shall pay to the collector of customs of the district in which the port of arrival is located, or in which any vessel of the line may be found, the sum of $300 for each and every violation of any provision of said sections; and no vessel shall have clearance from any port of the United States while any such fine is unpaid, nor shall such fine be remitted or refunded.”

. Section 16 of the Immigration Act of May 26, 1924 (8 USCA § 216):

“(a) It shall be unlawful for any person, including any transportation company, or the owner, master, agent, charterer, or consignee of any vessel, to bring to the United States by water from any place outside thereof (other than foreign contiguous territory) (1) any immigrant who does not have an unexpired immigration visa, or (2) any quota immigrant having an immigration visa the visa in which specifies him as a nonquota immigrant.
"(b) If it appears to the satisfaction of the Secretary of Labor that any immigrant has been so brought, such person or transportation company, or the master, agent, owner, charterer, or consignee of any such vessel, shall pay to the collector of customs of the customs district in which the port of arrival is located the sum of $1,000 for each immigrant so brought, and in addition a sum equal to that paid by such immigrant for his transportation from the initial point of departure, indicated in his ticket, to the port of arrival, such latter sum to be delivered by the collector of customs to the immigrant on whose account assessed. No vessel shall be granted clearance pending the determination of the liability to the payment of such sums, or while such sums remain unpaid, except that clearance may be granted prior to the determination of such question upon the deposit of an amount sufficient to cover such sums, or of a bond with sufficient surety to secure the payment thereof approved by the collector of customs.
“(c) Such sums shall not be remitted or refunded, unless it appears to the satisfaction of the Secretary of Labor that such person, and the owner, master, agent, charterer, and consignee of the vessel, prior to the departure of the vessel from the last port outside the United States, did not know, and could not have ascertained by the exercise of reasonable diligence, (1) that the individual transported was an immigrant, if the fine was imposed for bringing an immigrant without an unexpired immigration visa, or (2) that the individual transported was a quota immigrant, if the fine was imposed for bringing -a quota immigrant the visa in whose immigration visa specified him as being a non-quota immigrant.”

The contention of the government is that the alien had been brought to the United States “in violation of law,” and therefore that the steamship company was subject to the fine of $300 under section 18, notwithstanding the fine of $1,000 provided for under section 16 was not imposed as the steamship company had exercised due diligence and could not have ascertained that the alien was a quota immigrant, whose immigration visa specified him .as being a nonquota immigrant; in other words, that section 18 (8 USCA § 154) created an absolute liability upon a steamship company which brought to the United States an excludable alien. Clearly, the answer depends upon whether the alien was brought here “in violation of law.” If so, the fine imposed -under section 18 was proper; otherwise it was not.

Section 16(a), 8 USCA § 216(a) provides that “it shall be unlawful for any person, including any transportation company * * * to bring to the United States by water from any place outside thereof * * * (1) any immigrant who does not have an unexpired immigration visa, or (2) any quota immigrant having an immigration visa the visa in which specifies him as a nonquota immigrant.”

Thus it is expressly provided that it is unlawful to bring to the United States a quota immigrant having a nonquota visa, and the fact that in another subdivision of the section it imposes a fine of $1,000 upon the vessel for bringing in such an immigrant and that the Secretary of Labor may remit the $1,000 if it appears to his satisfaction that the steamship owner could hot, by the exercise of reasonable diligence, ascertain the real, status of the immigrant, does not make the act of bringing in such immigrant lawful. It is clearly stated to be unlawful.

Section 18 (8 USCA § 154) provides that all aliens brought to this country “in violation of law” shall be sent back on the steamer which brought them, and that it shall be unlawful for the owner of the vessel to refuse to receive on board or “to fail to detain” such alien, and imposes a fine of $300 for the failure to do so.v

It seems to me that the intention of Congress had two objectives in view: First, to impose a fine of $1,000 upon owners of vessels which brought in certain excludable immigrants, which fine the Secretary of Labor might remit if he was satisfied that the owner could not have ascertained, by the exercise of due diligence, that the immigrant was not admissible; second, to require the owner of the vessel to take back upon his vessel such immigrant, detain him until sailing time, and return him to the country from which he came, and, for the vessel owner’s failure to do this, a fine of $300. It does not seem at all likely that, merely'because the owner of the steamship had been relieved from paying the $1,000 fine for bringing in the alien, it was to be allowed to turn the immigrant loose and be rid of the obligation of returning him to the country where he came from. The conclusion that the remission of the $1,-000 fine does not affect the $300 for failure to detain is strengthened by that part of section 18 itself which, after providing for the fine of $300, says, “Nor shall such fine be remitted or refunded.”

Neither the facts nor the statute in the ease at bar are similar to those in Compagnie Francaise de Navigation a Vapeur v. Elting, Collector of Customs (C. C. A.) 19 F.(2d) 773. In that case a fine for bringing in an alien under an alleged violation of section 6 of the Act of May, 1921, as amended by Act. of May 11, 1922 (42 Stat. 540), was involved, and the court held that, as the immigrant might be admitted in the discretion of' the immigration officials under section 2 of the Immigration Act of 1921 (42 Stat. 5,540) and Regulations section 2, subd. (a), the vessel owner might bring the immigrant to this country so that he would have an opportunity of making his application to the proper authorities and present his evidence in support of it, and Judge Swan said: “It can scarcely be supposed that Congress intended to penalize-a vessel owner for transporting an alien privileged to come for such purpose.” 19 F.(2d) page 774.

In Compagnie Franeaise de Navigation a Vapeur v. Elting, supra, it was held that the owner of the vessel was not, under the circumstances, liable for a fine for bringing the immigrant so that he could make his application. The court did not hold or intimate that the vessel owner was relieved of duty imposed under section 18 of detaining and returning to the country from which the immigrant was brought in the event he was found to be not admissible.

Moreover, section 16 of the Immigration Act of 1924 (8 USCA § 216) is more specific and absolute than section 6 of the Aet of May, 1921, as amended by the Aet of May, 1922 (42 Stat. 540). Section 16 says: “It shall be unlawful * * * to bring to the United States * * * (1) any immigrant who does not have an unexpired immigration visa, or (2) any quota immigrant having an immigration visa the visa in which specifies him as a nonquota immigrant.”

Section 6 (42 Stat. 540) reads: “That it shall be unlawful * * * to bring to the United States * * * any alien not admissible under the terms of this Aet or Regulations made thereunder. * * * ” It is to be observed that section 6 refers to an alien not admissible under the aet or “Regulations.”

The fact that the complaint of the steamship company alleges that it exercised due care to prevent the escape of the alien is immaterial, as the duty to detain aboard its vessel and deport the alien was, under section 18 (8 USCA § 154), an absolute one.

Accordingly, the complaint is dismissed.


author: WATSON, District Judge.

text:
    SHUMAKER et al. v. BOROUGH OF DALTON et al.
    No. 633.
    District Court, M. D. Pennsylvania.
    July 16, 1931.
    J. E. Sickler, of Scranton, Pa., for plaintiffs.
    Welles, Mumford & Stark, of Scranton, Pa., for defendants.
   WATSON, District Judge.

This is an action to restrain the borough of Dalton, Pa., and its officers, from enforcing an ordinance forbidding the burial of the dead within certain described territory within the limits of the borough of Dalton.

The Dalton Cemetery Association, one of the plaintiffs, was incorporated by a decree of the court of common pleas of Lackawanna county, Pa., February 8, 1886. It had charge and control of a cemetery known as the “Shumaker Cemetery,” located in the borough of Dalton. All of the burial lots were sold many years ago, and the Dalton Cemetery Association was, and had been, for many years without funds with which to keep up the cemetery. E. Ellsworth Shu-maker, the other plaintiff, was the owner of certain land in the borough of Dalton, adjoining the Shumaker Cemetery, and within the territory described in the ordinance referred to.

Prior to the passage of the ordinance, Shumaker informed the Dalton Cemetery Association that he would deed to the association lots on his land for burial purposes as they were needed, the association to transfer them to the purchasers, and that he would turn over to the association 10 per cent, of the amount received for the lots, for use by the association for the care of the eemetery. No contract was ever entered into between the Dalton Cemetery Association and Shumaker, and no lots were ever deeded to the Dalton Cemetery Association by Shumaker, in accordance with his proposal.

The plaintiff contends that the ordinance should be declared invalid, unconstitutional, and void, because:

“(1) It violates that provision of the Fourteenth Amendment to the Constitution of the United States which says: ‘Nor shall any state deprive any person of life, liberty or property without due process of law/
“(2) It violates that provision of the Fourteenth Amendment to the Constitution of the United States which says: ‘Nor' (shall any state) ‘deny to any person within its jurisdiction the equal protection of the laws/
“(3) It violates that provision of section 10, article 1 of the Constitution of the United States which says: ‘No state shall * * * pass any * * * law impairing the ob-
ligation of contracts/
“(4) It is special legislation, and grossly discriminative against the plaintiffs.
“(5) It is arbitrary, oppressive, unreasonable/’

The question raised by reasons (1) and (2) is whether Shumaker’s property is taken contrary to the Fourteenth Amendment. By the Act of May 4, 1927, P. L. 519, art. 28, § 2801 (53 PS § 15021), the state of Pennsylvania conferred upon boroughs power to “prohibit within their limits, or within any described territory within such limits, the burial or interment of deceased persons,” and in pursuance thereof the borough of Dalton enacted the ordinance which prohibited the burial or interment of any deceased person within certain described territory within the limits of the borough.

That the state of Pennsylvania has the power to control and prohibit burials in municipalities, there can be no doubt.

In Kincaid’s Appeal, 66 Pa. 411, 5 Am. Rep. 377, the Supreme Court of Pennsylvania said: “No one can doubt the power of the legislature to prohibit all future interments within the limits of towns or cities. In ancient times, in Greece and Rome, such was the universal rule. It was one of the laws of the twelve tables ‘Hominem mortuum in urbe ne sepelite neve vieinitate.’ It is much to be regretted that it was not adopted as our policy at an early period. This is no invasion of any right of property. Every right, from an absolute ownership down to a mere easement, is purchased and held subject to the restriction that it shall be so exercised as not to injure others. Though at the time it may be remote and inoffensive, the purchaser is bound to know at his peril that it may become otherwise, by the residence of many people in its vicinity, and that it must yield to laws for the suppression of nuisances. If conditions or covenants, appropriating land to some particular use, could prevent the legislature from afterwards declaring that use unlawful, legislative powers necessary to the comfort and preservation of populous communities might be frittered away into perfect insignificance.”

And the state may confer the same power on municipal corporations, such as cities and boroughs. “Nor can it be doubted that the legislature may confer the same power upon municipal corporations, such as cities and boroughs. They are but subdivisions of the state, created by the state, for the comfort and convenience of the citizens dwelling therein. The state confers upon them a portion of its sovereignty for the purpose of enabling them to control their local affairs.” Klingler v. Bickel, 117 Pa. 326, 11 A. 555, 557.

In Laurel Hill Cemetery v. City and County of San Francisco, 216 U. S. 358, 30 S. Ct. 301, 302, 54 L. Ed. 515, the ordinance passed by the board of supervisors prohibited burials in existing cemeteries. The question was whether the property was taken contrary to the Fourteenth Amendment. In holding that it was not, Mr. Justice Holmes, in delivering the opinion of the court, said: “And yet again the extent to which legislation may modify and restrict the uses of property consistently with the Constitution is not a question for pure abstract theory alone. Tradition and the habits of the community count for more than logic. Since, as before the making of constitutions, regulation of burial and prohibition of it in certain spots, especially in crowded cities, have been familiar to the Western world. This is shown sufficiently by the cases cited by the court below, e. g., Coates v. New York, 7 Cow. [N. Y.] 585; Kincaid’s Appeal, 66 Pa. 411, 5 Am. Rep. 377; Sohier v. Trinity-Church, 109 Mass. 1, 21; Carpenter v. Yeadon, 158 F. 766, 86 C. C. A. 122. The plaintiff must wait until there is a change of practice or at least an established consensus of civilized opinion before it can expect this court to overthrow the rules that the lawmakers and the court of his own state uphold.”

The question raised by the third reason is whether the ordinance impairs the obligation of a contract. As already pointed out, no contract existed, the obligation -of which could be impaired. There is no evidence in this ease from which it can be found that a contract existed between the Dalton Cemetery Association and Shumaker. “Before we can be asked whether to determine whether a statute has impaired the obligation of a contract, it should appear that there was a legal contract subject to impairment, and some ground to believe that it has been impaired.” New Orleans v. New Orleans Water-Works Co., 142 U. S. 88, 12 S. Ct. 142, 146, 35 L. Ed. 943.

The remaining questions are those raised by the fourth and fifth reasons, and are as to whether the ordinance is special legislation and grossly discriminative against the plaintiffs, and whether it is arbitrary, oppressive, and unreasonable.

The ordinance cannot be held to be special legislation. “Ordinances are not laws within the meaning of the constitutional provisions prohibiting local or special legislation.” Taylor v. Philadelphia, 261 Pa. 458, 104 A. 766, 767.

The Legislature of Pennsylvania having conferred upon municipal corporations the power to enact ordinances for specific purposes, an ordinance adopted pursuant to such authority cannot be impeached as unreasonable because contrary to what the court might deem more equitable in the - particular instance. Ligonier Valley R. Co. v. Latrobe Borough, 216 Pa. 221, 65 A. 548. “The unreasonableness of an ordinance is a matter to be urged upon council at the time of its being considered by that body, as its conclusion finally adopted and set forth in the ordinance is not reviewable 'by the court merely because its provisions are alleged to be unreasonable and that the discretion vested in the eouncilmanie body has been unwisely exercised.” Ellwood Lumber Co. v. Pittsburgh, 269 Pa. 94, 112 A. 19, 20.

I shall not discuss all of the evidence, but say that, when the size, population, and surroundings of the borough are considered, also the conditions in the territory described in the ordinance, and the proportion of the area of the borough which was already devoted to cemeteries, the reasonableness of prohibiting burying in the portions or territory described in the ordinance (if that question is subject to a review by the court) was so proper that the decision of the borough council should not be interfered with. I have read all the testimony, and I agree that the decision of the council was exercised properly and for the public good.

As to the contention that the ordinance is discriminative, arbitrary, and oppressive: The ordinance creates no personal disability. All persons are prohibited. The ordinance is not directed against the plaintiffs,, or either of them, by name. If it had been so directed, the complaint might be a just one, but all. persons are equally prohibited and equally amenable for the violation of the ordinance. “The enactment of an ordinance by a borough, prohibiting the burial of deceased persons in designated territory within its limits, is a valid exercise of the legislative power vested by law in boroughs. * * * Where a borough has already three cemeteries within its limits, the prohibition to establish a fourth is not unjust, unreasonable, discriminatory, or an abuse of power.” Borough of Blakely v. Joseph Gilinsky, 17 Lack. Jur. (Pa.) 15.

The ordinance passed by the borough of Dalton is not unreasonable in its provisions, nor is it oppressive, arbitrary, or discriminatory in any particular. It is a valid exercise of the legislative police power fixed by law in the borough.

I have examined all of the cases cited by counsel and have examined them to the best of my ability, and I find nothing in any of them to cause me to doubt that the complainants have failed to make out their ease.

The bill is dismissed.