source: Caselaw Access Project

author: SPENCER WILLIAMS, District Judge: EUGENE A. WRIGHT, Circuit Judge HUFSTEDLER, Circuit Judge

license: Public Domain

text:
    SAINT PAUL MARINE TRANSPORTATION CORP., et al., Plaintiffs-Appellees, v. CERRO SALES CORPORATION, Defendant-Appellant.
    No. 72-1675.
    United States Court of Appeals, Ninth Circuit.
    Sept. 13, 1974.

      George L. Waddell (argued), of Dorr, Cooper & Hays, San Francisco, for defendant-appellant.
    Paul F. Cronin (argued), of Cronin, Fried, Sekiya & Haley, Honolulu, Hawaii, for plaintiffs-appellees.
    Before HUFSTEDLER and WRIGHT, Circuit Judges, and WILLIAMS, District Judge.

       Honorable Spencer Williams, United States District Judge, Northern District of California, sitting by designation.

   OPINION

SPENCER WILLIAMS, District Judge:

Early in the morning of June 23, 1968 the crew of the SS North America, a small Liberian tramp freighter, abandoned its flaming vessel approximately 600 miles east-southeast of Honolulu. The ship’s $1,850,000 cargo of copper concentrates bound for South America belonged to appellant Cerro Sales. The U. S. Coast Guard picked up the crew’s distress signal and at approximately 1515 (HST) directed the M/V St. Paul, a huge Liberian bulk carrier to proceed some 30 miles to render assistance to the disabled vessel. The St. Paul swept the area for some time, rescued 22 survivors and then turned its attention to saving the ship.

Crewmen from St. Paul under the leadership of Second Mate Anastasio boarded the North America that afternoon and again the next day. While the testimony is conflicting as to what happened on the respective days, it is clear that they extinguished several small fires, cleared the decks of burning material, closed several open doors, and on the second trip rigged an emergency towing wire from the North America’s bow to the St. Paul’s stern. The towing attempt was discontinued when the line snapped. On June 24th the St. Paul obtained Coast Guard permission to leave and proceed to Honolulu where the North America’s crew was put ashore.

The Hawaiian tug Malie, engaged by owners of the North America, left Honolulu June 28th, reached the distressed ship five days later, took it in tow and returned with it to Honolulu. The North America was sold as scrap but the $1.85 million cargo was saved intact.

The District court, in an opinion reported at 332 F.Supp. 233 (D.Haw. 1971), granted plaintiff a salvage award of $200,000, 65% to go to the vessel St. Paul and her owners with the remaining 35% to go to the officers and the crew. An extra $1000 was granted to Second Mate Anastasio and $500 to each other member of the boarding party.

Cerro Sales appeals the decision on six grounds: (1) all the actions of the vessel St. Paul were taken for the purpose of rescuing the crew of the North America — not for saving property — and therefore, the St. Paul and the non-boarding crew members are not entitled to a property award; (2) the master and crew are not parties to this purported class action; (3) plaintiffs did not sustain the burden of proving their activities saved the North America and her cargo; (4) the St. Paul, having voluntarily abandoned the North America, is precluded from a salvage award; (5) the district court erred in refusing to reopen the case to take testimony from a witness after a decision was entered; and (6) the amount of the award was unreasonable in relation to the services performed.

The Award, to the Owner and Non-Boarding Crew Members

Appellant contends only crew members who went aboard the North America performed salvage acts with respect to the North America’s cargo and this precludes the St. Paul’s owner and the non-boarding crew members from sharing in the salvage award. This position is contrary to established admiralty law. All who render service in a salvage operation may share in an award. Each individual need not actively participate by manning the small boats, boarding the salved vessel or fighting fires. Norris, The Law of Salvage § 48. Every man’s duties on the salving ship contribute to the property salvage and the law extends a portion of the award to even a “scullion in the galley peeling potatoes while the actual salvage work is going on.” The Centurion, 1 Ware 490 (D.Me.1839). See also The Norden, 1 Spinks 185 (1853); The Barge Ulak, 1924 A.M.C. 1500 (S.D.N.Y.1924).

Similarly, the owner of the salving vessel need not personally participate in the salvage service to receive an award. Norris, supra, § 57; The Blackwall, 77 U.S. 1, 10 Wall. 1, 19 L.Ed. 870 (1869); The Camanche, 75 U.S. 448, 8 Wall. 448, 19 L.Ed. 397 (1869); Sear v. SS American Producer, 1972 A.M.C. 1647 (N.D.Cal.1972); Conolly v. SS Karina II, 302 F.Supp. 675 (E.D.N.Y. 1969).

Class Action Requirements

This action was properly maintained by the St. Paul on its own behalf and on the behalf of the master and crew and is not subject to Federal Rule of Civil Procedure 23.

Admiralty courts have long accepted the obvious judicial economy in maritime representative suits to allow owners of salving vessels to sue on behalf of the master and crew although judgments in such suits do not provide complete theoretical protection to the defendants. The Camanche, supra, at 470-77, 2 Benedict, Law of American Admiralty § 247. See 1 Benedict, supra, § 123, The Lowther Castle, 195 F. 604 (D.N.J.1912); The Neptune, 277 F. 230 (2d Cir. 1921).

Defense and Abandonment

Appellant had the burden of proving the affirmative defense of abandonment. If a potential salvor does abandon a distressed vessel, it is precluded from any award. The abandonment, however, must be voluntary, absolute and of such nature that indicates an absence of all further interest in the property or an indifference to whether it will be saved or not. The Loch Garve, 182 F. 519 (9th Cir. 1910); The City of Puebla, 153 F. 925 (N.D.Cal.1907); The Strathnevis, 76 F. 855 (D.Wash.1896); The Angeline Anderson, 34 F. 925 (D.N.Y.1888); The Khio, 46 F. 207 (D.Md.1891); The Aberdeen, 27 F. 479 (E.D.N.Y.1885); The Tolomeo, 7 F. 497 (S.D.Fla.1881). Therefore, if a salving vessel, after doing all it can and having contributed to the salvage of the vessel, finds it impossible to continue and complete the entire salvage, the doctrine of abandonment does not apply. The Fisher’s Hill, 1953 A.M.C. 2037 (S.D.N.Y. 1953), rev’d. sub nom. Lago Oil and Transport Co. v. United States, 218 F.2d 631 (2d Cir. 1955); Atlantic Transport Co. v. United States, 42 F.2d 583 (Ct.Cl.1930); The Strathnevis, supra. The District Court found that the St. Paul had not abandoned the North America, and in view of the evidence of the attempted (though unsuccessful) tow, the boarding of the vessel, the extinguishment of deck fires, clearing of burning material, closing of open doors, notification to the Coast Guard of the North America’s position and the St. Paul’s remaining on station until authorized to depart, it cannot be said that such a finding is clearly erroneous.

Refusal to Reopen Testimony

The refusal to reopen the testimony to call a new defense witness was not an abuse of discretion under Rule 59(a) of the Federal Rules of Civil Procedure. The motion was made two months after the Decision was entered and over four months after the trial. The trial court obviously did not consider any new evidence either necessary or proper.

Factual Support for the District Court’s Findings

Defendant vigorously asserts the record does not support the district court’s determination that the firefighting and the closing of certain apertures significantly contributed to the salvage of the vessel and her cargo. The record contains over 850 pages of reporter’s transcripts, two depositions of witnesses upon written interrogatories and four depositions on oral interrogatories along with innumerable photographs, log books and transcriptions of radio messages. Additionally, the circumstances surrounding the presentation of evidence were somewhat unusual given the international composition of the crew, numerous language difficulties, and the time-lag between the accident, when the statements were taken and the trial.

The trier of fact has the duty to sift through the inconsistencies of testimony, to weigh the credibility of witnesses and to resolve any ambiguities in the evidence. The scope of appellate review is a narrow one limited to setting aside findings of fact only when they are clearly erroneous. Federal Rule of Civil Procedure 52(a); Guzman v. Pichirilo, 369 U.S. 698, 82 S.Ct. 1095, 8 L.Ed.2d 205 (1962).

The trial court found that (1) a crew from the St. Paul boarded the North America June 23rd, (2) a second party went aboard on June 24th, (3) crew members closed open doors and portholes, (4) the North America’s stern was down and her freeboard was less than normal, (5) the crew extinguished numerous fires on the deck, hatch covers and threw burning debris into the sea, and (6) but for these activities the North America would have sunk.

The district court relied quite heavily on the testimony of John Walsh, plaintiff's expert witness, in making its award. Answering a hypothetical question, Walsh testified that, in his opinion, two series of acts performed by the St. Paul’s crew saved the ship. He con-eluded that without the firefighting action by the crew, the fire would have spread to the No. 5 hatch and the after accommodation house. The hold under No. 5 hatch would then have been open to sea water. If the after accommodation house had burned, the portholes below decks would have disintegrated and have been open to the sea. As noted, these portholes were partially submerged when the North America reached Honolulu. Therefore, but for the firefighting actions, sea water would have flowed into both the aft-hold of the ship and into the after accommodation house through the open portholes. Walsh emphasized that had either one or both of these events occurred, the North America would have sunk.

Walsh also testified that, independent of the fire-fighting, the closing of open doors and portholes contributed to the ultimate salvage of the cargo. The stern was down when the salvage tug Malie reached the North America, her freeboard was less than normal and the surveyors ultimately found approximately 15 feet of water in the engine spaces. Walsh persuaded the court that any sea water that had been kept out of the ship could well have been the overbalancing amount that would have sunk her. When the salvors closed the doors and portholes, they prevented the awash deck conditions and the lack of freeboard from reaching a critical point, thus keeping the North America afloat until the salvage tug reached her.

This expert opinion, obviously persuasive to the district court, is properly supported by facts in the record. The determination that the St. Paul’s crew saved the defendant’s cargo is therefore not clearly erroneous.

The Size of the Award

Of the $200,000 awarded, $130,000 (65%) went to the St. Paul and her owners, [including $15,000 for reimbursement of costs and expenses], and $70,000 went to the officers and crew. Appellant argues this award is “grotesquely excessive” in relation to the labor expended and the risks incurred.

The Supreme Court has suggested the following criteria for determining an appropriate salvage award: (1) the labor expended by the salvors in rendering the salvage services, (2) the promptitude, skill and energy displayed in rendering the service and saving the property, (3) the risk incurred by the salvors in securing the property from its peril, (4) the value of the property saved, (5) the degree of danger from which the property was rescued, and (6) the value of the property employed by the salvors and the danger to which the property was exposed. The Blackwall, 77 U.S. 1, 13-14, 10 Wall. 1, 19 L.Ed. 870 (1869).

These guidelines have weathered the storms of the past century. See Norris, supra, at 386 (1958); Seaman v. Tank Barge OC601, 325 F.Supp. 1206, 1208-1209 (S.D.Ala.1971). An inspection of the district court’s opinion in this case indicates that in making the award he applied factors analogous to these guidelines.

The St. Paul, her master and crew performed in careful, seamanlike fashion while boarding the burning ship, fighting the fires, sealing off the lower spaces and attempting to tow the North America; they willingly exposed themselves to considerable danger by boarding a burning, disabled vessel under the threat of continuing explosions. The danger of collision between the two ships during the abortive towing operation was extremely high due to the North America’s short tow line. The salvaged property had a stipulated value of $1.85 million and was in imminent danger of being lost when the North America was saved. The St. Paul, carrying a cargo valued at $750,000, was worth over $4 million.

Appellant further contends that any dangers to which the St. Paul and her cargo were exposed during the unsuccessful. towing attempt must be disregarded when determining the size of the award. Admiralty courts award property salvage as a matter of public policy to induce future potential salvors to assume the inconvenience and unknown risk inherent in every salvage effort.

The question thus becomes whether, as a matter of public policy, the courts should consider only the risks inherent in a ship’s good faith attempts at rescue that are actually shown to have contributed to the rescue.

The evidence indicates the St. Paul’s master, although apprehensive of the risks involved, told his owners he would attempt to tow the North America to safety. He sent members of his crew aboard the North America to extinguish the fires and to rig the ship for towing. These activities were interrelated portions of the salvage operation which, in toto, saved the cargo. Portions of that successful salvage may not be discounted when figuring the size of the award. To do so would discourage future salvors from attempting similar acts when given the opportunity to render assistance and frustrate the policy underlying marine salvage awards.

It would be unwise to accept appellant’s totally unsupported premise that unsuccessful efforts contained within the context of an overall successful salvage operation may not be considered. A successful salvage must be viewed as one continuum from beginning to end. Any other rule would require courts to make speculative and unreasonable dissections of complex, multi-faceted salvage operations. By way of example, if defendant’s rule were applied to the plaintiff’s activities in this action, the trial court would be required to determine the quantum of risk and the contribution to the ultimate salvage of each extinguished fire, each closed porthole and question whether each man who boarded the disabled ship successfully extinguished a fire or closed a crucial door. This type of determination has not been required to date and nothing warrants the implementation of such a restrictive rule.

However, the $15,000 reimbursement for costs, included in the owner’s $135,000 award, was erroneously computed on an alleged three-day effort during the salvage operation. The St. Paul was only engaged for 25.5 hours and the $3,840.00 daily cost estimate was unre-futed. The award for costs will therefore be reduced to $4,070.40.

The judgment of the district court is affirmed with the reduction of the owner’s share to $124,070.40.

EUGENE A. WRIGHT, Circuit Judge

(concurring):

I concur in Judge Williams’ opinion with the following additional comments concerning the issue of abandonment.

As Judge Williams points out, if the distressed ship is ultimately saved, the general rule that an abandoning salvor forfeits a salvage award does not preclude an award simply because the salvor does not complete the task of saving the distressed ship. See The Fisher’s Hill, 1953 A.M.C. 2037 (S.D.N.Y.), rev’d sub nom. on other grounds Lago Oil and Transport Co. v. United States, 218 F.2d 631 (2nd Cir. 1955); Atlantic Transport Co. v. United States, 42 F.2d 583 (Ct.Cl.1930); The Strathnevis, 76 F. 855 (D.Wash.1896), and cases cited therein. Appellant argues that in these cases mechanical disability or weather conditions rendered further salvage efforts impossible, whereas no similar circumstances accompanied St. Paul’s departure from the disabled North America. St. Paul was simply unable to take North America safely in tow.

The purpose of salvage awards and the abandonment rule dictate that we reject the contention that an award for a partial salvage be predicated upon the physical impossibility of further effort. Salvage awards encourage mariners to aid ships in distress. See Atlantic Transport Co v. United States, supra, 42 F.2d at 589. Similarly, the abandonment rule encourages those who do aid distressed vessels to maximize their efforts and to discourage them from quitting the salvage before doing all that reasonably can be done. But where more cannot reasonably be accomplished and the distressed ship is ultimately saved, it serves no purpose to deny an award.

Indeed, a contrary rule would discourage potential salvors from giving assistance if they thought that they could not complete the salvage by towing the distressed ship to port. Significantly for this case, the disincentive to give partial assistance to the best of one’s ability does not depend on whether the obstacle to further aid is physical impossibility or, as here, impracticality due to the relative values of the vessels and the risks involved. We should not insert such dissuasion into the law.

The reasoning of the court in Atlantic Transport Co. v. United States, id., did not depend on the fact that further salvage efforts were physically impossible:

Where a vessel is in distress, in peril and danger, as here, or where the sea is rough and the weather unfavorable and the wind high, or where other facts which usually attend a vessel in distress exist, there is always a risk and danger in rendering assistance. It is easier for another vessel to stay out of the way or to pass by and not attempt to render assistance than it is to undertake the risk of doing so and incur a risk of injury to itself and a possible loss of life and cargo in connection with the effort. It has therefore been the policy of the courts, in order to encourage salvaging and the saving of life and property at sea, to be liberal in the matter of salvage where the vessel has made an honest effort to be of assistance or has joined with others in doing so, whether its efforts resulted in the final saving of the vessel or not, provided the failure of final success was not due to any lack of honest effort and willing purpose to assist. . . . “It is not necessary, in order to establish a claim to salvage, that the salvor should actually complete the work of saving the property at risk. It is sufficient if he endeavor to do so, and his efforts have a causal relation to the eventual preservation of it.”

The court’s reasoning supports an award under the circumstances of this case.

Of course, the salvor must show that it did what it reasonably could do and that his effort had “a causal relation to the eventual preservation of” the ship. But this is a factual question to be resolved by the trier of fact. The district court apparently agreed with appellees that St. Paul “made an honest effort to be of assistance,” that she did all that she reasonably could do under the circumstances, and that she did not “abandon” North America. I cannot conclude that this finding is “clearly erroneous.”

HUFSTEDLER, Circuit Judge

(dissenting) :

The crew of the Saint Paul performed ably and courageously in rescuing crewmen from the North America and in boarding her later in an attempt to salvage the vessel and her cargo. But our admiration for the men of the Saint Paul is not a substitute for evidence that the efforts of the boarding parties meaningfully contributed to the ultimately successful salvage by the tug Ma-lie.

The key district court findings were that the boarding parties closed doors and portholes in the after accommodations and that without that action seawater would have entered the vessel through these apertures in such quantities that the vessel could have sunk before the Malie reached her. No one testified that anyone closed portholes. The porthole finding is based solely on Di-Colo’s unsworn statement in Italian annexed to his deposition. The Italian statement was accompanied by an English translation that does not mention portholes. Porthole closing entered the case for the first and only time when plaintiff’s in-court translator was trying to interpret DiColo’s unsworn statement. Of course, the DiColo statement was inadmissible hearsay even if the translator correctly interpreted it, a dubious assumption under the circumstances. Plaintiffs do not question its hearsay character; rather, they argue that defendant waived objection when it failed to object upon the initial offer of the document. The document was offered, along with a number of other documents, under a single number before any testimony was taken. Defendant’s counsel reserved the right to correct the translation. After plaintiff’s translator testified, defendant’s counsel moved to strike the unsworn statement, and the motion was denied. The motion should have been granted. On these facts, no predicate exists for a waiver of the hearsay objection.

Testimony is in the record that the boarders closed one or more of the poop house doors. For two reasons the door closing episode cannot sustain the district court’s further finding that the boarding crew’s activities contributed to salvaging the vessel: first, neither the plaintiff’s expert nor the court attempted to decide what effect door closing would have had on the vessel if portholes had not also been closed; second, no substantial evidence, direct or circumstantial, supported an inference that the amount of water that was prevented from entering the vessel through the closing of one or more doors in the poop house could have been enough to sink the vessel.

Entirely apart from these deficiencies in the evidence, the Saint Paul is foreclosed from any recovery because she abandoned the North America. The Saint Paul conducted vigorous and successful efforts in rescuing the crew of the North America. In contrast, her attempt, after the crew were rescued, to salvage the vessel was brief, sporadic, and ineffectual. She did not have adequate equipment to make more than a passing try to salvage the North America. After her insufficient towline parted, she gave up any further salvage operations and left. Her departure was voluntary; she was not dismissed, superseded, or disabled by her salvage attempt. She is not to be criticized for deciding that the risks to herself were too great to undertake any further salvage efforts, but neither is she entitled to a salvage award after she voluntarily abandoned the North America. The district court’s finding that she did not abandon the vessel is unsupported by the record and is thus clearly erroneous.

The important purposes served by salvage awards and the abandonment rule are impaired, not promoted, by permitting those whose contributions to ultimate salvage are as slight as those performed by the Saint Paul to share in the salvage award. Heroic efforts to salvage are not likely to be made by salvors knowing that any ultimate bounty will be shared handsomely with any potential salvage claimant who made any fleeting effort toward salvage.

I have no occasion to reach any of the other issues. I would reverse.

      . Appellant also points out that proceeding to the disabled ship, rescuing survivors, searching for lost crew members and transporting the survivors to Honolulu were actions directed at “life salvage.” If this was all that liad been done by the St. Paul, plaintiffs would be limited to an action against the tug Malie for a share of its propery award under 46 U.S.O. § 729. The fire fighting and closing of doors were directed at saving the cargo and have given the owner and the non-boarding crew members a right to participate in any salvage award. See St. Paul v. Cerro Sales, 313 F.Supp. 377 (D.Hawaii 1970).

      . The Advisory Committee on the Federal Rules of Civil Procedure, commenting on the merger of admiralty and civil practice, treated representative marine salvage suits under Rule 17 (a) and not under Rule 23. See 7A Moore’s Federal Practice U .55 (3).

      . The defendant suggests the plaintiff should have attempted more than one tow, searched below deck for water leaks and additional fires, rigged navigational running lights and left a crew to stand watch until a salvage tug arrived. A suggested course of conduct made with the benefit of “20-20” hindsight does not alter an appellate court’s standard of review over district court factual determinations.

      . Tlie district court correctly discounted all activities directed at life salvage from its consideration of the property salvage award and also noted that the “bare attempt” to tow the North America had not contributed to the ultimate salvage of the cargo.

      . Defendant belatedly objects that certain statements made by Seaman DiColo were inadmissible hearsay and therefore, improperly considered by the district court. Counsel must make and preserve his record at the trial level and may not present new objections on appeal. The record clearly shows that defendant waived any objection to the admissibility of the statement on two occasions. Reporter’s Transcript at Pages 12 and 147.

      . Probably the most significant evidence presented came from Mr. John Walsh, an expert witness presented by plaintiff, and one of three surveyors who surveyed the North America upon her arrival at Honolulu. Mr. Walsh has impressive credentials and presented himself and his testimony in a manner most persuasive upon the Court.” gee 332 F.Supp. 233, at 237-238 (D.Hawaii 1971).

      . Plaintiff asked Walsh to assume the following facts before giving his expert opinion :
      (1) a boarding party had gone aboard the North America,
      (2) members of that party had extinguished the following small fires :
      (a) debris fires in the area between No. 4 and No. 5 hatches,
      (b) small fires in the after area of No. 4 hatch,
      (c) other fires in the area of No. 3 hatch,
      (3) threw burning boards and other items overboard from the areas around both No. 3 and No. 4 hatches,
      (4) neither No. 5 hatch cover was damaged by fire nor the after accommodation house was damaged by fire.
      (5) the aft portholes were partially submerged before the vessel reached Honolulu, and

        (6) the North America had a freeboard of less than normal when she was towed to safety in Honolulu.
      The testimony of the various witnesses, although varying to some degree, placed all the above facts before the court.

      . Walsh testified that this would have caused the aft end to submerge and/or increase the “probability of a decisive free-surface area in No. 4 hold,” (i. e. cause the North America to roll heavily in a very sluggish manner allowing the sea to break over the open deck).

      . Reporter’s Transcript Page 360.

      . Statistical comparisons, while not disposi-tive, can be helpful. The owners of the St. Paul received a $130,000 award or less than 3% of the combined value of the St. Paul and its cargo that had been exposed to risk of loss during the salvage operation.
      The $200,000 salvage award is approximately 11% of the value of appellant’s cargo that would have been lost but for the St. Paul and her crew.

      . Merrit & Chapman v. United States, 274 U.S. 611, 47 S.Ct. 663, 71 L.Ed. 1232 (1926), cited by defendant, does not support its position. In that case, a vessel, lying next to a blazing pier, was cooled by an overflow of water that had been directed at the pier fire. The Supreme Court refused to allow a salvage award on the grounds that any aid to the ship was both unrequested and merely incidental.

      . Waterman SS Corporation v. Dean, 171 F.2d 408 (4th Cir. 1948), cert. denied 337 U.S. 924, 69 S.Ct. 1168, 93 L.Ed. 1732 (1948); The Kia Ora, 252 F. 507 (4th Cir. 1918); United States v. Aslaksen, 281 F. 444 (6th Cir. 1922); The Yarzin, 180 F. 892, aff’d 185 F. 1007 (2d Cir. 1910); The Philah, F.Cas.No. 11091a (D.Fla.1857). See also, Dize v. Steel Barge Beverley, 247 F.Supp. 968, 973 (E.D.Va.1965).

      . Success is a prerequisite to any salvage award. Courts will not reward any efforts, however meritorious, if the property is not ultimately saved. However, the St. Paul and her crew were successful in saving both the ship and her copper cargo.

      . See Exhibits P-5 (a), P-16, P-37, P-41, and P-42.

      . Mr. Walsh, the plaintiff’s expert witness, based his opinion that the plaintiff’s efforts contributed to the salvage upon hypothetical questions. When the facts in a hypothetical are not supported by the record, the foundation for the expert’s opinion obviously collapses,


author: PER CURIAM:

text:
    UNITED STATES of America, Appellee, v. Thomas Courtney COOK, Appellant.
    No. 226, Docket 74-1729.
    United States Court of Appeals, Second Circuit.
    Argued Sept. 11, 1974.
    Decided Oct. 8, 1974.

      Brian F. Mumford, Asst. U. S. Atty., Albany, N. Y. (James M. Sullivan, Jr., U. S. Atty., Albany, N. Y., on the brief), for appellee.
    Steven Delibert, New York Civil Liberties Union, New York City, for appellant.
    Before SMITH, TIMBERS and GURFEIN, Circuit Judges.

       At the time of oral argument, Judge Gurfein was a District Judge of the United States District Court for the Southern District of New York, sitting by designation.

   PER CURIAM:

Thomas Courtney Cook appeals from a judgment entered May 20, 1974 after a bench trial in the Northern District of New York, James T. Foley, Chief Judge, convicting him of failure to report for induction in the armed forces of the United States, in violation of Section 12(a) of the Military Selective Service Act of 1967, 50 U.S.C. App. § 462(a) (1970). He was adjudged a Young Adult Offender, 18 U.S.C. § 4209 (1970); imposition of a prison sentence was suspended; and he was placed on probation for a period of two years, 18 U.S.C. § 5010(a), with the special condition that he perform work contributing to the national interest during his probation.

The only issue open to us on this appeal is the correctness of Judge Foley’s holding that a I-S(C) deferment terminates on completion of a registrant’s actual course of study for the school year, rather than 12 months from the date the registrant begins his course of study as claimed by appellant.

We agree with Judge Foley’s interpretation of “academic year” since the purpose of a I-S(C) deferment is fully served on completion of the actual course of study for the school year. We assumed that to be the proper interpretation in United States ex rel. Vacca v. Commanding Officer, 446 F.2d 1079, 1083 (2 Cir. 1971). We see no reason for departing from that view here. See McLain v. Local Board 47, 439 F.2d 737, 741-42 (8 Cir. 1971); Nestor v. Hershey, 425 F.2d 504, 512-13 (D.C.Cir. 1969); Marowitz v. Local Board 12 (N.D.N.Y.1973); Peller v. Local Board 65, 313 F.Supp. 100, 103-04 (N.D.Ind. 1970) . To the extent that Walsh v. Local Board 10, 305 F.Supp. 1274 (S.D.N.Y.1969), construed “academic year” to mean the 12 month period following the beginning of the registrant’s course of study, we disapprove that construction.

In the instant case, appellant’s induction order was mailed to him on August 24, 1970, some two months after the end of his academic year in June, but was returned by appellant to the local board on September 15. Judge Foley found that the government had proven beyond a reasonable doubt all the requisite elements of a knowing and wilful refusal to report for induction as required by law. We agree.

We affirm on the well reasoned opinions of Judge Foley, reported at 383 F.Supp. 353 (N.D.N.Y.1974).

Affirmed.

      . Appellant’s argument that, as a Mohawk Indian and as such a member of the Six Nations of Indians (although born in Hanover, New Hampshire, the son of a United States citizen), he is exempt from service under the Military Selective Service Act of 1967, is foreclosed by our decision in Ex parte Green, 123 F.2d 862 (2 Cir. 1941), cert. denied, 316 U.S. 668 (1942), to which we continue to adhere.

      . Referring to “academic year” as used in Section 6(i) (2) of the Military Selective Service Act of 1967, 50 U.S.C. App. § 456 (i) (2) (1970), and the then applicable regulation, 32 C.F.R. § 1622.15(b) (1970), the regulation having since been repealed. 36 Fed .Reg. 23376 (1971).


text:
    DILLINGHAM CORPORATION, a corporation-employer, and Employers Mutual Liability Insurance Company of Wisconsin, a corporation-insurer, Appellants, v. W. L. MASSEY, Deputy Commissioner Fourteenth Compensation District under the Longshoremen’s & Harbor Workers’ Compensation Act and Allan G. MacDonald, Claimant, Appellees.
    No. 72-2555.
    United States Court of Appeals, Ninth Circuit.
    Oct. 29, 1974.
    Order Dec. 12, 1974.

      Ridgway K. Foley, Jr. (argued), of Souther, Spaulding, Kinsey, Williamson & Schwabe, Portland, Or., for appellants.
    Raymond J. Conboy (argued), of Poz-zi, Wilson & Atchison, Portland, Or., Ronald R. Glancz, Atty. (argued), of Appellate Section, Civil Div., Dept, of Justice, Washington, D. C., for appellees.
   OPINION

Before KILKENNY and SNEED, Circuit Judges, and JAMESON, District Judge.

PER CURIAM:

Appellee MacDonald (claimant) submitted a claim against appellant Dil-lingham Corporation (employer) for a work-related injury under the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C. § 901 et seq. After an evidentiary hearing, appellee Massey, Deputy Commissioner under the Act, found that claimant’s pre-existing condition did not constitute a “previous disability” pursuant to the Act and, therefore, that employer was liable for the full amount of the award. The district court upheld the Deputy Commissioner’s findings, and this appeal follows.

The primary issue on appeal is whether the Deputy Commissioner committed error in finding that a previous disability did not exist. A secondary issue relates to the finding on percentage disability.

FACTS

Claimant suffered a broken hip at age 12 which resulted in a slightly shorter left leg and a minor limp. He, nevertheless, led a physically active adolescence and participated in high school athletics. He was rejected for military service because of the condition, but still engaged in years of strenuous physical employment. He worked as a shipfitter, a logger, and a marine machinist, all occupations which involved considerable heavy work, including climbing, bending and lifting. His leg condition in no way prevented him from engaging in normal employment.

In 1963, claimant fell while working as a machinist on a ship being repaired by employer. He suffered an injury which severely aggravated his pre-exist-ing condition. Further degeneration developed in 1966, culminating in a falling accident at home in 1970, inability to continue employment, and a bleeding duodenal ulcer, all found to be caused by the aggravated condition. In appropriate proceedings in 1972, the employer was found liable for 85% permanent partial disability of the left leg and compensation retroactive to 1964.

LEGAL BACKGROUND

Section 8(f)(1) of the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C. § 908(f) (1), provides a limited exception to the general rule of full liability for the employer in workmen’s compensation cases. If a claimant’s injury coalesces with a “previous disability,” his award is prorated between the employer and the Second Injury Fund provided by the government.

The principal purpose of this special provision is to aid the handicapped in obtaining employment. It protects them from discrimination by employers who might otherwise refuse to hire them due to the increased risk of disability. Lawson v. Suwanee Fruit & Steamship Co., 336 U.S. 198, 201-202, 69 S.Ct. 503, 93 L.Ed. 611 (1949).

However, Congress did not intend that all pre-existing conditions come under coverage by the Fund, but only those “manifest” at the time of initial employment. American Mutual Ins. Co. of Boston v. Jones, 138 U.S.App.D.C. 269, 426 F.2d 1263, 1267 (1970). An underlying condition which is not manifest to a prospective employer cannot qualify as a previous disability. United States Fidelity & Guaranty Co. v. O’Keeffe, 240 F.Supp. 816 (S.D.Fla. 1962). Thus, the key to the issue is the availability to the employer of knowledge of the pre-existing condition, not necessarily the employer’s actual knowledge of it. American Mutual, supra, 426 F.2d at 1267.

The determination of a previous disability’s manifestation is a factual one, and a number of factors may come into play. The employee’s appearance, medical reports and work experience are relevant, but the critical element is what the employer has available to him when the hiring occurs, should he decide to take notice of it. Boyd-Campbell Co. v. Shea, 254 F.Supp. 483 (S.D.Tex.1966), is clearly in point.

Because the administrative determination at issue is a factual one, American Mutual Ins. Co. of Boston, supra, 426 F.2d at 1268, we are bound by the findings of the Deputy Commissioner unless we can say that they are unsupported by substantial evidence taking the record as a whole. O’Keeffe v. Smith, Hinchman & Grylls, 380 U.S. 359, 85 S.Ct. 1012, 13 L.Ed.2d 895 (1965); O’Leary v. Brown-Pacific-Maxon, Inc., 340 U.S. 504, 71 S.Ct. 470, 95 L.Ed. 483 (1951); Portland Stevedoring Co. v. Johnson, 442 F.2d 411 (CA9 1971).

CONCLUSION

The administrative record shows that between the time of claimant’s childhood injury and his employment by appellant, he consistently engaged in activities and employment which would lead the average person to conclude that he had no disability.

The fact that claimant’s pre1963 condition showed up on X-ray photographs and resulted in a military deferment is not dispositive of the issue. What is manifest to a physician is not necessarily manifest to a lay employer. Boyd-Campbell, supra. On the record as a whole there is a substantial evidence to sustain the Deputy Commissioner’s findings of fact.

We likewise conclude that the record shows substantial evidence in the form of physicians’ statements to sustain the factual finding of an 85% permanent partial disability of claimant’s left leg.

Judgment affirmed.

ORDER ON ATTORNEY FEES

Appellee MacDonald has applied for reasonable attorney fees in this court pursuant to the provisions of 33 U.S.C. § 928(b). Appellants object to the allowance of attorney fees on the ground that the case under consideration arose prior to the effective date of the relevant legislation, November 26, 1972. The same type of objection was presented, fully considered and rejected in Overseas African Construction Corp. v. McMullen, 500 F.2d 1291, 1297 (CA2 1974). Convinced that the Second Circuit properly disposed of the issue, we adopt McMullen as the law of this circuit on this point and award appellee MacDonald an attorney fee in the sum of $1,500.00 against appellants.

       The Honorable William J. Jameson, Senior United States District Judge for the District of Montana, sitting by designation.


author: DONALD RUSSELL, Circuit Judge:

text:
    ARMCO STEEL CORPORATION, a corporation, et al., Appellants, v. UNITED MINE WORKERS OF AMERICA et al., Appellees. UNITED STATES STEEL CORPORATION, Appellant, v. UNITED MINE WORKERS OF AMERICA et al., Appellees.
    Nos. 74-1323 and 74-1324.
    United States Court of Appeals, Fourth Circuit.
    Argued April 30, 1974.
    Decided Nov. 8, 1974.

      David D. Johnson, Charleston, W. Va. (Jackson, Kelly, Holt & O’Farrell, Forrest H. Roles and Spilman, Thomas, Battle & Klostermeyer and R. Page Henley, Jr., Charleston, W. Va., on brief), for appellants in No. 74-1323.
    Leonard L. Scheinholtz, Pittsburgh, Pa. (Reed, Smith, Shaw & MeClay, Pittsburgh, Pa., Charles M. Love and Campbell, Love, Woodroe & Kizer, Charleston, W. Va., on brief), for appellant in No. 74-1324.
    Joseph A. Yablonski, Washington, D. C. (Lewis D. Sargentigh, James M. Hav-iland, Pittsburgh, Pa., Steven B. Jacobson, Washington, D. C., Bruce C. Boyens, Leo Catsonis and Catsonis & Linkous, Charleston, W. Va., on brief), for appel-lees in Nos. 74-1323 and 74-1324.
    Before HAYNSWORTH, Chief Judge, and RUSSELL and WIDENER, Circuit Judges.
   DONALD RUSSELL, Circuit Judge:

Protesting certain state and federal regulations on the allocation, distribution and sale of gasoline during the oil crisis in early 1974 — regulations which it was asserted unfairly interfered with their travel to and from work — certain unidentified coal miners allegedly affiliated with various locals' of the United Mine Workers, but not employees of either of the plaintiffs in these two actions, set up picket lines about the mines operated by the plaintiffs United States Steel Corporation and Armco Steel Corporation. The plaintiffs’ employees, all of whom were represented by the United Mine Workers of America under the terms of the National Bituminous Goal Wage Agreement of 1971, refused to cross these picket lines, thereby causing a work-stoppage at the mines of the two plaintiffs.

(a) United States Steel Corporation v. United Mine Workers

The plaintiff United States Steel promptly filed in the District Court an action under Section 301 of the Labor-Management Relations Act of 1947, 29 U.S.C. § 185, seeking (1) to enjoin the work-stoppage as allegedly in violation of the Bituminous Coal Wage Agreement, (2) to require compliance by the defendants with the arbitration procedures of that agreement, and (3) for damages. The defendants in this action are the United Mine Workers of America, District No. 29 of the national union and the six locals, representing the employees at the plaintiff’s several mines. Contemporaneous with the filing of the action, it moved before the District Court for a temporary injunction against the work-stoppage. After hearing, the District Court entered an order denying both preliminary and permanent injunctive relief. In so doing, it held that, while the plaintiff was “suffering irreparable damage and harm from refusal of the members of said defendant Local Unions to cross picket lines maintained by unidentified pickets,” the work-stoppage did not represent “an ar-bitrable matter under the wage agreement” and would not provide a basis for injunctive relief under Boys Markets v. Clerks Union (1970), 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199. It is from that order that the United States Steel Corporation prosecutes its appeal. See, Section 1291, 28 U.S.C.

(b) Armco Steel Corporation v. United Mine Workers

In its original complaint, filed about the same time as that of the United .States Steel, Armco Steel set forth three counts: one under the Sherman AntiTrust Act, 15 U.S.C. § 1 et seq., a second, under the Emergency Petroleum Allocation Act of 1973 (P.L. 93-159) and the Economic Stabilization Act of 1970, as amended (12 U.S.C., § 1904), and a third, a common law count for tortious interference with employees contrary to state law. After hearing, the District Court held it was without jurisdiction to entertain counts one and two and jurisdiction over count three being pendent, it dismissed the third count as well. At this point Armco moved for and was granted leave to amend by adding a fourth count, setting up a claim under Section 301 of the Labor-Management Relations Act of 1947, as amended, similar to that asserted by the United States Steel. Following this amendment, Arm-co applied for a temporary injunction on the same grounds pressed by United States Steel and the District Court made a similar ruling. Armco has appealed both the dismissal of its anti-trust action as well as the dismissal of its application for relief under its fourth count.

(c) Consolidation for Appeal of Two Cases

Since the appeals of both United States Steel and Armco have the same factual background and, at least so far as the actions under Section 301 are concerned, present similar issues, we consolidated the appeals for hearing and shall decide the two appeals in a single opinion.

I.

Section SOI Actions

First consideration will be given to the Section 301 actions and the denial of relief therein by the District Court in both cases on like grounds. In United States Steel injunctive relief only was denied. In Armco all relief was denied.

In Boys Markets it was established that a District Court, subject to the traditional principles of equity, has jurisdiction under Section 301 to grant in-junctive relief against a work-stoppage on the part of the union if the collective bargaining agreement contains a mandatory arbitration procedure and the work-stoppage is over a grievance or involves a matter which the parties are contractually bound to arbitrate. Monongahela Pow. Co. v. Loc. No. 2332 (4 Cir., 1973), 484 F.2d 1209, 1214, n. 14; Wilmington Shipping Company v. International Longshoremen’s Assn. (4th Cir. 1974); cf., Pilot Freight Carriers, Inc. v. International Brotherhood of Teamsters (4th Cir. 1974), 497 F.2d 311. The defendants, however, contend that Boys Markets is inapposite in these case for three reasons: 1. The Bituminous Coal Agreement of 1971 does not include a specific “no-strike” provision or promise not to engage in any work-stoppage which, under their view of Boys Markets, is essential to injunctive i'elief; 2. The dispute, giving rise to the work-stoppage, was not arbitrable; and 3. The refusal of workers to violate a picket line may not be enjoined.

The first objection of the defendants may be quickly disposed of. An agreement not to strike and not to engage in a work-stoppage over any arbitrable issue may be implied from a mandatory arbitration provision in a labor-management contract. This was specifically held in Gateway Coal Co. v. United Mine Workers (1974), 414 U.S. 368, 94 S.Ct. 629, 38 L.Ed.2d 583. There the Court said:

“Although the collective-bargaining agreement in Boys Markets contained an express no-strike clause, injunctive relief also may be granted on the basis of an implied undertaking not to strike. In Teamsters Local v. Lucas Flour Co., 369 U.S. 95 [82 S.Ct. 571, 7 L.Ed.2d 593] (1962), the Court held that a contractual commitment to submit disagreements to final and binding arbitration gives rise to an implied obligation not to strike over such disputes.” (p. 381, 94 S.Ct. p. 638)

It should be noted that the 1968 agreement involved in Gateway has like language to the 1971 agreement involved here. And in its decision construing that earlier provision, the Court held categorically that such Agreement incorporated by implication a no-strike provision and a promise to submit to binding arbitration any arbitrable dispute or issue. It is true the obligation found by the Court to exist was an implied and not an express obligation. But, as Gateway decided, an implied obligation not to strike is as effective as an express obligation in supporting jurisdiction under Boys Markets. Actually, Gateway’s holding that an implied agreement not to strike is as effective as an express one is little more than a reiteration of what had been indicated in Boys Markets itself. There, the Court, in stating its rule, upheld jurisdiction to grant in-junctive relief on the basis of “a no-strike obligation, express or implied,” thereby equating “implied” with “express” obligations (398 U.S. at p. 248, 90 S.Ct. 1583). It follows, therefore, that there was an implied obligation on the Union under this Agreement to submit to mandatory arbitration any arbi-trable issue between the Union and the employers and that this “implied” obligation was as good as an “express” provision, so far as the application of Boys Markets was concerned.

Accepting the postulate that there was an obligation under the Agreement involved here, to submit any arbitrable issue to mandatory arbitration, the next issue is: Was the refusal of the members of the Union to cross the picket lines an arbitrable issue? Monongahela Pow. Co. v. Local No. 2332, supra (484 F.2d 1209), seems conclusive that it was. In that case, the Court stated that a court, in construing a labor agreement, should “resolve all doubt in favor of arbitration, and order arbitration ‘unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute.’ ” (at 1213). Following this premise, the Court held that “a union’s no-strike commitment can give rise to an arbitrable dispute warranting judicial intervention in the form of a labor injunction.” The dispute there involved was the same as here, i.e., the arbitrability of the refusal of members of a local union to cross picket lines established by another local. The picket lines, which the members of the defendant local were honoring in that case, were established for the purpose of showing “sympathy and solidarity” with employees on strike in another Division of the employer and represented by another local. The objective of the picketing was as unrelated and foreign to the actual working conditions of the employees at the installation where the members of the defendant Union worked as was the objective of the picketing in these cases. And the contractual obligation to arbitrate was as definite as it was in Monongahela. Thus, the Agreement in these cases included a positive affirmance on the part of all parties “that they will maintain the integrity of this contract and that all disputes and claims which are not settled by agreement shall be settled by the machinery provided in the ‘Settlement Disputes’ article of this agreement unless national in character * * Under the “Settlement of Disputes” provision of the Agreement, the parties agreed for final and binding arbitration of any dispute about matters specifically mentioned in the Agreement and “about matters not specifically mentioned in this agreement,” particularly “should any local trouble of any kind arise at the mine.” And, in order to make the arbitration provision more all-inclusive, the Agreement calls for binding arbitration of any controversy “as to the meaning and application of the provisions of this agreement.” The only difference between this Agreement and the labor contract involved in Monongahela is that in the former there is an implied no-strike provision and in the latter an express no-strike provision. Gateway, however, makes such difference immaterial. Monongahela and Wilmington Shipping Company, which reaffirmed Monongahela, establish, so far as this Circuit is concerned, the arbitrability of the grievance here.

Since argument of these appeals, counsel for the Union has called to our attention Gary-Hobart Water Corporation (1974) 210 N.L.R.B. No. 87. We find nothing in that decison at variance with the above conclusions. The Board recognized, as we held in Monongahela, that the right of employees “to refuse to cross another union’s picket line, may be waived by appropriate provisions in a collective-bargaining agreement.” It found authority for that conclusion, as we did, in N.L.R.B. v. Rockaway News Supply Co. (1953), 345 U.S. 71, 73 S.Ct. 519, 97 L.Ed. 832. It held, of course, that the waiver was “only as extensive as the scope of the grievance and arbitration procedure of the contract in question” and that “when the subject of the dispute is not cognizable under the grievance-arbitration procedure the quid pro quo for the no-strike clause is no longer present and the no-strike clause does not apply.” This is but another way of expressing the principle that Boys Markets applies only when the grievance is arbitrable. But the statement of such a principle presents no impediment to the plaintiffs’ demand for injunctive relief in these cases: The ar-bitrability of the grievance in these eases is, as we have already said, clear under the Agreement. There is thus nothing in Gary-Hobart that militates against the conclusions reached above.

The final argument of the defendants that the right of employees to honor a picket line, even in the face of a no-strike provision in the collective-bargaining agreement executed on behalf of such employees, is federally protected and may not be the subject of injunctive relief was answered in Monongahela, where, relying on N.L.R.B. v. Rockaway News Supply Co., supra, we said that the “statutory right of employees to refuse to cross a picket line * * * may be waived * * * by the action of their union in agreeing to a no-strike clause.” (484 F.2d p. 1214).

The appellees do not appear to dispute nor could they well dispute that the plaintiffs have established their right to injunctive relief under the traditional equity rules. The District Court found that the defendants had engaged in a work-stoppage and were likely to continue to do so unless restrained. It concluded, too, that the plaintiffs, as a result of such work-stoppage were suffering irreparable injury for which they had no adequate remedy at law. Those findings, along with our conclusion that the dispute centering on the work-stoppage, contrary to the conclusion reached by the District Court, was arbitrable, entitled the plaintiffs to injunctive relief. The denial of temporary injunc-tive relief and the dismissal of the actions for injunctions and damages were accordingly error.

II.

Armco’s Anti-Trust Action

Turning now to the anti-trust action pressed by Armco: The District Court correctly dismissed so much of Armco’s original and amended complaint as sought to set up a claim under the anti-trust laws against the defendants. In Apex Hosiery Co. v. Leader (1940), 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311, the Court emphasized that the Sherman Act had never been applied “in any case, whether or not involving labor organizations or activities, unless the Court was of opinion that there was some form of restraint upon commercial competition in the marketing of goods or services and finally this Court has refused to apply the Sherman Act in cases like the present in which local strikes conducted by illegal means in a production industry prevented interstate shipment of substantial amounts of the product but in which it was not shown that the restrictions on shipments had operated to restrain commercial competition in some substantial way.” There is no allegation or contention that the strike of the unions involved, however illegal it may have been, was for the purpose of restraining commercial competition in the marketing of goods or services, or that it had operated to restrain commercial competition in some substantial way. There was accordingly no cause of action stated under the Sherman Act.

Armco’s reliance on Los Angeles Meat & Provision Drivers Union v. United States (1962), 371 U.S. 94, 83 S.Ct. 162, 9 L.Ed.2d 150 and Columbia River Packers Association, Inc. v. Hinton (1942), 315 U.S. 143, 62 S.Ct. 520, 86 L.Ed. 750 is misplaced. In the former case, the Court expressly found that the case “was not one ‘involving or growing out of any labor dispute,’ but one involving an illegal combination between businessmen and a union to restrain commerce. In such a case, as Allen Bradley Co. clearly held, neither the Norris-LaGuardia Act nor the labor exemption provisions of the Clayton Act are applicable.” (371 U.S. at 102, 83 S.Ct. at 166) In Hinton, the dispute was one “among businessmen over the terms of a contract for the sale of fish”; it was one “altogether between fish sellers and fish buyers.” The sellers of fish were “not employees of the petitioners or of any other employer, nor do they seek to be.” The controversy was plainly not a labor dispute and could not qualify under the Norris-LaGuardia exemption.

Conclusion

The District Court was in error in refusing the plaintiffs temporary injunc-tive relief and in dismissing the actions for a permanent injunction under the rule in Boys Markets; it, however, properly dismissed the cause of action asserted by the plaintiff Armco under the anti-trust law. The Court also erred in dismissing the cause of action for damages under § 301 in the Armco case. Since we hold a cause of action was stated in count four in the Armco amended complaint, the District Court on remand should reconsider its ruling dismissing the pendent state law count in that case. Mine Workers v. Gibbs (1966), 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218.

These actions are accordingly affirmed in part, reversed in part, and remanded with directions in conformity with the foregoing conclusions.

      . On application under FRAP Rule 8, an injunction in both cases pending appeal was granted by a member of this Court.

      . Appeal from the dismissal of the second count is to the Temporary Emergency Court of Appeals. (Emergency Petroleum Allocation Act of 1973, § 5, incorporating by reference § 211(b) (c) of Economic Stabilization Act of 1970, 12 U.S.C. § 1904 (note) ). Armco has filed an appeal to that Court and that appeal is pending.

      . See, Wilmington Shipping Company v. International Longshoremen’s Association, supra (Adams, J., concurring), summarizing tile holding in Monongahela.

      . The right to recover of the defendants in damages is not before us and we express no opinion thereon. For an excellent discussion of such right, see Xote, 6 Ga.L.Rsv. 797 (1972).

      . 310 U.S. at pp. 495-497, 60 S.Ct. at pp. 993-994.


author: WEBSTER, Circuit Judge.

text:
    STANDING ROCK SIOUX INDIAN TRIBE, Appellee, v. Byron L. DORGAN, Tax Commissioner, State of North Dakota, Appellant.
    No. 74-1119.
    United States Court of Appeals, Eighth Circuit.
    Submitted May 17, 1974.
    Decided Nov. 1, 1974.

      Marvin J. Sonosky, Washington, D. C.. for appellant.
    Albert R. Hausauer, Sp. Asst. Atty. Gen., Bismarck, N. D., for appellee.
    Before GIBSON, Chief Judge, WEBSTER, Circuit Judge, and Williams, District Judge.

       The Honorable Paul X Williams, United States District Judge, Western District of Arkansas, sitting by designation.

   WEBSTER, Circuit Judge.

This appeal presents for our consideration the jurisdiction of a federal court to entertain an action brought by an Indian tribe to recover state sales and use taxes illegally collected from its members by the Tax Commissioner of North Dakota. The District Court dismissed the action for want of subject matter jurisdiction. Holding this action to be barred by the Eleventh Amendment to the Constitution of the United States, we affirm the judgment of the District Court.

In 1973 the Supreme Court of North Dakota declared that the action of tax officials in collecting sales and use taxes from Indians on tribal reservations contravened the Constitution, laws and treaties of the United States. White Eagle v. Dorgan, 209 N.W.2d 621 (N.D.1973). The Standing Rock Sioux Indian Tribe promptly filed its complaint in federal court against the state tax commissioner, seeking to recover all sums illegally collected from its members. It is from the dismissal of this action that the Tribe appeals.

In this case the Tribe has sued as parens patriae to collect monetary damages on behalf of its members, at least some of whom are potential claimants for tax refunds under the reimbursement program established by the state. In its complaint, the Tribe has claimed injury to itself, asserting that its sovereignty has been diminished by the illegal taxation, as well as injury to its members, in that at least some of them were compelled to pay taxes unlawfully assessed by the state. Cf. McClanahan v. Arizona State Tax Commissioner, 411 U.S. 164, 93 S.Ct. 1257, 36 L.Ed.2d 129 (1973). Jurisdiction of the District Court is predicated upon 28 U.S.C. § 1362 and 28 U.S.C. § 1343(3). However, we must first consider such asserted jurisdiction in the light of appellee’s claim of sovereign immunity under the Eleventh Amendment to the Constitution of the United States, for, where properly invoked, the Eleventh Amendment bars the action regardless of the statutory basis of jurisdiction. O’Neill v. Pennsylvania, 459 F.2d 1 (3d Cir. 1972).

I

The Eleventh Amendment provides :

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

While it is not clear whether the court below considered the Eleventh Amendment in its dismissal of the action, we note that under the recent decision of the United States Supreme Court in Edelman v. Jordan, 415 U.S. 651, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974), “the Eleventh Amendment defense sufficiently partakes of the nature of a jurisdictional bar so that it need not be raised in the trial court” in order to be properly presented to the Court of Appeals. 415 U.S. at 678, 94 S.Ct. at 1363. See also Ford Motor Co. v. Department of Treasury, 323 U.S. 459, 466-467, 65 S.Ct. 347, 89 L.Ed. 389 (1945).

The doctrine of sovereign immunity as embodied in the Eleventh Amendment has been liberally construed to achieve its intended purpose. Thus, an unconsenting state is immune from suit in federal court by its own citizens, a situation not expressly covered therein. Edelman v. Jordan, supra; Employees v. Department of Public Health and Welfare, 411 U.S. 279, 93 S.Ct. 1614, 36 L.Ed.2d 251 (1973); Parden v. Terminal Railway Co., 377 U.S. 184, 84 S.Ct. 1207, 12 L.Ed.2d 233 (1964); Great Northern Life Insurance Co. v. Read, 322 U.S. 47, 64 S.Ct. 873, 88 L.Ed. 1121 (1944); Duhne v. New Jersey, 251 U.S. 311, 40 S.Ct. 154, 64 L.Ed. 280 (1920); Hans v. Louisiana, 134 U.S. 1, 10 S.Ct. 504, 33 L.Ed. 842 (1890). In addition, the Amendment has been construed to preclude federal jurisdiction in a suit against a state brought by a foreign government. Monaco v. Mississippi, 292 U.S. 313, 54 S.Ct. 745, 78 L.Ed. 1497 (1934). Finally, the Amendment may be invoked by the state where it is not a named party but is the real party in interest in an action for the recovery of money against a state official or agency. Scheuer v. Rhodes, 416 U.S. 232, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974); Edel-man v. Jordan, supra; Ford Motor Co. v. Department of Treasury, supra; Ex parte New York, 256 U.S. 490, 41 S.Ct. 588, 65 L.Ed. 1057 (1921).

The suit in this case is by the Standing Rock Sioux Tribe against the North Dakota Tax Commissioner. It is strictly a suit for money damages. The complaint alleges an abuse of lawful authority by the Commissioner in refusing to make tax refunds to reservation Indians from whom taxes were collected unlawfully as a matter of federal law. The complaint, however, does not seek to impose personal liability upon the Commissioner, and counsel has conceded in oral argument that the funds would come from the state treasury. Contrast Scheuer v. Rhodes, supra, where the claim alleged an abuse of lawful authority and sought personal liability. If this suit is in fact a suit against the state to recover a refund of taxes upon the ground that the tax was illegal under federal law, then federal courts are without power to entertain it without the consent of the state. Edelman v. Jordan, supra; Ford Motor Co. v. Department of Treasury, supra; Great Northern Life Insurance Co. v. Read, supra; see Anderson v. Graham, 492 F.2d 986 (8th Cir. 1973); Like v. Carter, 486 F.2d 552 (8th Cir. 1973). Such consent to be sued in federal court is not alleged in the complaint nor may it be inferred from procedures established by North Dakota for the reimbursement of individual taxpayers. See Great Northern Life Insurance Co. v. Read, supra, 322 U.S. at 53-54, 64 S.Ct. 873.

II

In attempted avoidance of the effect of the Eleventh Amendment, the Tribe argues (1) that the suit is not in fact against the state and (2) that as an Indian tribe its claim lies outside the reach of the Eleventh Amendment. We reject both contentions.

The Real Defendant

The Tribe contends that the Amendment has no application here because the funds sought to be recovered are available to the Tax Commissioner under the constitution and laws of North Dakota without resort to an intrusion into the state treasury. We disagree. The constitution and the statutory scheme of North Dakota do permit the tax collector to pay refunds to taxpayers without individual authorization from the legislature. See N.D.Const. § 186(1); N.D.C.C. § 57-01-12; § 57-39.-2-25 (1972). The Tribe, however, has paid no taxes and therefore is not entitled to receive monies from those funds unless deemed an appropriate party by a court of competent jurisdiction. Whether they should be paid to the Tribe is a question on the merits and cannot be reached unless jurisdiction is first established. And jurisdiction is precluded here because no matter whether judgment is obtained against the Tax Commissioner in his official capacity or against the state, the funds are to come from the state treasury.

The Status of Indian Tribes

We turn now to the Tribe’s contention that 28 U.S.C. § 1362 authorizes Indian tribes to sue in federal court whenever the United States could sue, and since the Eleventh Amendment does not bar suits by the United States, the Tribe likewise cannot be barred.

Prior to the enactment of 28 U.S.C. § 1362 in 1966, considerable uncertainty existed regarding the capacity of a tribe to sue or be sued in the absence of a specific statute conferring such capacity. See United States Department of Interior, Federal Indian Law 490-91 (1972). In United States v. Minnesota, 270 U.S. 181, 46 S.Ct. 298, 70 L.Ed. 539 (1926), the Supreme Court recognized the right of the United States to sue the State of Minnesota on behalf of an Indian tribe in the Supreme Court for the return of lands or monetary proceeds allegedly taken in violation of the treaties between the United States and the Indians. Commenting on the fact that the United States, which had a direct interest in the case, had sued where the Indians could not have done so, the Court observed :

The reason the Indians could not bring the suits suggested lies in the general immunity of the State and the United States from suit in the absence of consent. Of course, the immunity of the State is subject to the constitutional qualification that she may be sued in this Court by the United States, a sister State, or a foreign State. * * * Otherwise her immunity is like that of the United States. But * *■ * the fact that [the Indians] could not sue the State [does not] show that the United States is without right to sue her for their benefit.

270 U.S. at 195, 46 S.Ct. at 301.

When Congress enacted 28 U. S.C. § 1362 in 1966, it intended to authorize Indian tribes to bring suits in federal court to protect their federally derived property rights in those situations where the United States has declined to act in their behalf. Fort Mojave Tribe v. LaFollette, 478 F.2d 1016 (9th Cir. 1973); see Salt River Pima-Maricopa Indian Community v. Arizona Sand and Rock Co., 353 F.Supp. 1098 (D.Ariz.1972). Thus, “one of the purposes of the legislation was to permit the Tribes to initiate litigation involving issues which could have been instituted by the United States as trustee.” Moses v. Kinnear, 490 F.2d 21, 25 n.9 (9th Cir. 1974); Confederated Salish and Kootenai Tribes v. Moe, Civil No. 2145 (D. Mont., Oct. 11, 1973) slip opinion at 6.

The complaint lacks any allegation, however, which would have made the United States the real party in interest even if the United States had brought the action as Trustee prior to the enactment of § 1362. The state no longer taxes Indians contrary to law. The United States has no direct interest in monies illegally collected from the Indians. In a case in which the United States has no direct interest, § 1362 cannot elevate the Tribe to a position equivalent to that of the United States. The Tribe, therefore, cannot pierce the shield of sovereign immunity with an illusory sword. Moreover, since there is nothing in 28 U.S.C. § 1362 to suggest that the United States intended to waive its own sovereign immunity by this enactment, Scholder v. United States, 428 F.2d 1123, 1125 (9th Cir.), cert. denied, 400 U.S. 942, 91 S.Ct. 240, 27 L.Ed.2d 246 (1970), there is certainly no basis for inferring that this statute abrogated the sovereign immunity of the several states.

A second argument that the Tribe is not a citizen of any state and is therefore outside the reach of the Eleventh Amendment leads us first to the “stateless person” cases which hold that where a party is unable to establish that he is either a citizen of a state or a citizen or subject of a foreign state, no diversity jurisdiction exists in federal court. Shoemaker v. Malaxa, 241 F.2d 129 (2d Cir. 1957); Factor v. Pennington Press, Inc., 238 F.Supp. 630 (N.D.Ill.1964); Reyes v. Penoci, 202 F.Supp. 436 (D.P.R.1962); Pemberton v. Colonna, 189 F.Supp. 430 (E.D.Pa.1960), aff’d per curiam, 290 F.2d 220 (3d Cir. 1961); Blair Holdings Corp. v. Rubenstein, 133 F.Supp. 496 (S.D.N.Y.1955). Indeed, it is clear that an Indian tribe is not a citizen of any state and cannot sue or be sued in federal court under diversity jurisdiction, Federal Indian Law, supra, at 341; see Oneida Indian Nation v. County of Oneida, 464 F.2d 916 (2d Cir. 1972), rev’d on other grounds, 414 U.S. 661, 94 S.Ct. 772, 39 L.Ed.2d 73 (1974).

But the reasoning in those would-be diversity cases is not controlling in Eleventh Amendment cases, where different policy considerations come into play. In Blair Holdings Corp. v. Ruben-stein, supra, the court rejected the plaintiff’s contention that a logical extension of the rule that “stateless persons” are not subject to diversity jurisdiction would require a construction of the Eleventh Amendment permitting “stateless persons” to sue a state in federal court. The court said:

[Plaintiff’s] contention fails to recognize the difference between sovereign immunity and jurisdiction founded on diversity. A literal construction of the Eleventh Amendment would have done violence to the fundamental concept that ‘it is inherent in the nature of sovereignty not to be amenable to the suit of an individual without its consent’ and that this ‘exemption, as one of the attributes of sovereignty, is now enjoyed by the government of every state in the Union.’ Hans v. State of Louisiana, supra, 134 U.S. at page 13, 10 S.Ct. at page 506.

133 F.Supp. at 502 (footnote omitted).

We think this analysis is fully consistent with the liberal interpretation traditionally afforded the Eleventh Amendment.

Ill

In conclusion, we hold that the Eleventh Amendment bars this suit for money damages, and that neither 28 U.S.C. § 1362 nor the plaintiff-Tribe’s similarity to a “stateless person” exempts it from this jurisdictional bar.

      . The complaint also prayed for interest, attorneys’ fees and other appropriate relief.

      . Honorable Bruce M. VanSickle, United States District Judge, District of North Dakota.

      . That the collection of the taxes was illegal is not contested. Moreover, appellant concedes that a procedure has been established by the state wherein any aggrieved individual taxpayer may submit and process his claim against the state.
      “Guidelines” published by Tax Commissioner Dorgan’s office provide in part as follows :
      Refunds for sales and use tax must be made pursuant to the provisions of Chapter 57-39.2 and Chapter 57-40.2 of the North Dakota Century Code.
      An Indian customer who has paid sales and use tax and who is now entitled to a refund may file a refund claim for such sales and use tax directly with the State Tax Commissioner accompanied by proper proof and thus receive the cash refund directly. In this way no claim need be filed with or through the retailer. Refund claims must be filed within three years of the date on which the tax was paid; however, claims for refunds for years beyond the three year limitation will be given a hearing by the Tax Commissioner and, if denied, can be appealed to the Court.
      The type of proof required will vary depending upon the factual situation of each ease but generally must consist of and include such documentation as: copies of sales tickets or their equivalent showing the amount of sales or use tax paid, the date of payment, identity of retailer to whom it was paid, and the identity of the customer; or a statement from the retailer to the effect that the tax was received from the customer and remitted to the State Tax Commissioner along with the amount of tax involved, dates of payment, and identity of the customer.
      The Tribe’s complaint challenged the conditions imposed by these Guidelines as “impossible to fulfill * *

      . There is no allegation of any payment of the unlawfully imposed taxes by the Tribe itself, and the Tribe has presented no plan to return the refunds to any individual taxpayer should it prevail in this action.

      . 28 U.S.C. § 1362 provides :
      The district courts shall have original jurisdiction of all civil actions, brought by any Indian tribe or band with a governing body duly recognized by the Secretary of the Interior, wherein the matter in controversy arises under the Constitution, laws, or treaties of the United States.

      . 28 U.S.C. § 1343 provides in part:
      The district court shall have original jurisdiction of any civil action authorized by law to be commenced by any person:
      * * * * *
      (3) To redress the deprivation, under color of any State law, statute, ordinance, regulation, custom or usage, of any right, privilege or immunity secured by the Constitution of the United States or by any Act of Congress providing for equal rights of citizens or of all persons within the jurisdiction of the United States.
      * * * * *

      . As explained infra, the Amendment has been held applicable to suits in federal court against a state brought by a citizen thereof.

      . See note 3 supra.

      . Arguably, the question whether the reimbursements should be paid to the Tribe is a question of standing, i. e., whether the Tribe has alleged sufficient injury on behalf of its members to bring this action to collect refunds for the taxes which these individual taxpayers were unlawfully compelled to pay. Cf. Sierra Club v. Morton, 405 U.S. 727, 92 S.Ct. 1361, 31 L.Ed.2d 636 (1972). We have recognized that in appropriate cases an organization may have standing to vindicate the constitutional rights of its members. NAACP v. Button, 371 U.S. 415, 428, 83 S.Ct. 328, 9 L.Ed.2d 405 (1963); Smith v. Board of Educ. of Morrilton, 365 F.2d 770 (8th Cir. 1966). In any event, although standing to sue is a threshold question, see Adolphus v. Zebelman, 486 F.2d 1323 (8th Cir. 1973), as is sovereign immunity, it is unnecessary for us to reach the former because of our disposition of the case on the latter ground.

      . See note 5 supra.

      . Another purpose of the statute was to eliminate the jurisdictional amount requirement of 28 U.S.C. § 1331 for a particular class of suits, namely federal — question actions brought by an Indian tribe or band. Scholder v. United States, 428 F.2d 1123 (9th Cir.), cert. denied, 400 U.S. 942, 91 S.Ct. 240, 27 L.Ed.2d 246 (1970); Quinault Tribe of Indians v. Gallagher, 368 F.2d 648, 655-656 (9th Cir. 1966), cert. denied, 387 U.S. 907, 87 S.Ct. 1684, 18 L.Ed.2d 626 (1967); H.R.Rep.No.2040, 89th Cong., 2d Sess., 1966 U.S.Code Cong. & Admin.News, at pp., 3145, 3146; see Oneida Indian Nation v. County of Oneida, 414 U.S. 661, 94 S.Ct. 772, 39 L.Ed.2d 73 (1974).

      . We are not concerned, therefore, with the substantial number of cases which have permitted suits for injunctive or declaratory relief against state officials in their official capacity. Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908); Edelman v. Jordan, supra, 415 U.S. 1347, 94 S.Ct. 1347; Rothstein v. Wyman, 467 F.2d 226, 236-237 (2d Cir. 1972), cert. denied, 411 U.S. 921, 94 S.Ct. 1552, 36 L.Ed.2d 315 (1973). Moreover, we recognize that there is some authority for the proposition that the Eleventh Amendment would not bar a tribe from suing a state official where the remedy sought is injunctive or declaratory relief rather than monetary damages. See Great Lakes Inter-Tribal Council, Inc. v. Voigt, 309 F.Supp. 60 (W.D.Wis.1970); cf. Sohappy v. Smith, 302 F.Supp. 899 (D.Ore.1969).