author: LOVETT, District Judge.

text:
    BOWLES, Adm’r for Office of Price Administration, v. BEARD et al.
    Civil Action No. 324.
    District Court, S. D. Georgia, Savannah Division.
    May 28, 1945.
    S. F. Memory, Jr., and Bernard M. Nelson, both of Savannah, Ga., for plaintiff.
    R. W. McDuffee, of Savannah, Ga., for M. L. Beard and Mrs. Bessie Beard.
    W. Spencer Connerat, of Savannah, Ga., for Atlantic Savings & Trust Co.
   LOVETT, District Judge.

This action was brought by the Administrator pursuant to section 205(a) of the Emergency Price Control Act to restrain further violation of that Act by the defendants. Jurisdiction is conferred upon this court by section 205(c).

On August 20, 1942, the defendant Atlantic Savings & Trust Company, as agent for T. C. Farmer, owner of the premises in question located at 324 East 39th Street in Savannah, Georgia, registered the upper floor as an unfurnished apartment with six rooms as required by the rent regulations of the Office of Price Administration. The registration stated that the rent received on the maximum rental date was $25.90 per month. The defendant Trust Company has continually up to and including the present received exactly the same rent ($25.90 per month) in full compliance with all laws and regulations of the O.P.A.

On September 15, 1940, defendant M. L. Beard rented this apartment unfurnished for $25.90 per month from the defendant Trust Company and placed his own furniture in it. On August 16, 1943, Beard sub-rented the apartment to Mrs. Juanita Seals as a furnished apartment, he allowing his furniture to remain in it, at a monthly-rental of $65.

On January 1, 1944, the Atlantic Savings & Trust Company filed with the Area Rent Director a report of change in tenancy, certifying that as of that date the tenancy was changed from Beard to his mother, Mrs. Bessie Beard. From January 1, 1944, through February, 1945, Beard continued to collect $65 monthly from Mrs. Seals. At the time of each collection he presented Mrs. Seals with his own receipt for $40 for his furniture and also with a receipt purported to be signed by his mother, Mrs. Bessie Beard, for $25.90 for rent on the apartment, though only $65.00 total was paid by Mrs. Seals.

On March 5, 1945, the Atlantic Savings & Trust Company filed with the Area Rent Director another report of change in tenancy certifying that as of that date the tenancy was changed from Mrs. Bessie Beard to Mrs. Jaunita Seals. For the months of March, April and May, 1945, Mrs. Seals has paid the rent of $25.90 direct to the bank and the $40 to Beard for the furniture. The president of the Trust Company testified neither M. L. Beard nor Mrs. Bessie Beard are at this time contractually liable to the Trust Company for any rent. They have been released. No one contradicts him.

On several occasions during the tenancy periods of M. L. Beard and Mrs. Bessie Beard they were served with notice by the Rent Director that this dwelling unit should be registered as a furnished apartment.

On March 10, 1945, the Area Rent Director, still considering this a furnished apartment, issued his order decreasing the maximum rent from $65 to $47.50 per month. The order was made retroactive to October 1, 1943, and refunds of all amounts in excess of $47.50 per month collected since that date were ordered within 30 days. No refunds have been made by any of the defendants, and the rental charges of $25.90 plus $40 have continued.

This action is to enjoin the defendants, (1) from renting any dwelling unit in the Savannah Defense Rental Area at a rental higher than that fixed by the Area Rent Director, (2) from decreasing the furniture and equipment supplied with the upper apartment at 324 East 39th Street in Savannah until a petition to decrease has been filed and allowed and (3) from evicting the tenants from that apartment without first complying with the provisions of the rent regulations relating to the eviction of tenants.

It is the position of the Atlantic Savings & Trust Company that it has never violated or attempted to violate any of the regulations of the Office of Price Administration nor any of the laws under which such regulations have been made and that it has in all respects attempted to cooperate with the Office of Price Administration. On the hearing the Trust Company showed that it had never been requested to decrease the amount of rent ($25.90) which it had collected since the original registration, that it had not been given an opportunity to discuss the matter with the Area Rent Director, and that the first notice of any proceedings in respect to a decrease in rent was the service of the complaint and the order of the court requiring it to appear and show cause why an injunction should not be issued for acts which the Trust Company never committed. The Trust Company complains that such action on the part of the Area Rent Director was done either deliberately or heedlessly and with utter disregard of its rights, that it was made a party without good reason or justification, that such action has reflected upon the good name and reputation of the Atlantic Savings & Trust Company and has caused unnecessary embarrassment to its officers and employees and that the complaint should be dismissed as to this defendant.

It is the contention of defendants M. L. Beard and Mrs. Bessie Beard that this housing accommodation has never been rented as a furnished apartment but that there has always been one landlord renting the housing accommodation and another and separate landlord renting the furniture, that there was no conspiracy to evade the maximum rent regulations but that, on the contrary, the Office of Price Administration is seeking to fix and control the rental of furniture and thus extend its powers to that over which it has no jurisdiction.

If the manipulations of defendants Beard are not found to be in violation of the statute or regulations, then it can be said that they have done nothing unlawful but have successfully avoided the law. If, however, they have evaded the duties imposed by law upon them as landlords, they are guilty of a violation and relief against them may be obtained.

The plaintiff’s case is based principally upon sections 9, 13 and 4(j) of the Rent Regulation for Housing: Section 9; “The maximum rents and other requirements provided in this regulation shall not be evaded, either directly or indirectly, in connection with the renting or leasing or the transfer of a lease of housing accommodations.” 10 F.R. 330. (Emphasis added). Section 13 (6) : “ ‘Housing accommodation’ means any * * * real or personal property rented or offered for rent for living or dwelling purposes, together with all * * * furniture * * * connected with the use or occupancy of such property.” For similar provision see Emergency Price Control Act, section 302(f), 50 U.S.C.A.Appendix § 942(f).

Section 4(j) provides that “within 30 days after the accommodations are first rented fully furnished, the landlord shall register them as a furnished unit.”

It is the plaintiff’s position that, although the lease for the unfurnished apartment is at the present time in Mrs. Seals’ name, the true landlord is not the Atlantic Savings & Trust Company, but is Beard, and that both Beard and the Trust Company should be restrained from collecting any amount of rent greater than that set out in the Area Rent Director’s order of March 10, 1945.

Plaintiff specifically contends that when M. L. Beard, on August 16, 1943, sub-let the apartment and at the same time rented his furniture to Mrs. Juanita Seals, he changed the unfurnished accommodation to a fully furnished unit of which he was the landlord, that as a furnished accommodation the rental was subject to the rent regulation for .housing and that Beard’s failure to register the same within 30 days was a violation of his legal obligation under the rent regulation.

In support of its position plaintiff submits the Administrator’s interpretation of section 13(a) (6), supra, of the regulation defining housing accommodations. The interpretation deals with the extent to which renting of furniture is subject to rent regulation where furniture and the balance of the housing accommodations are separately owned.

Comments on Interpretation l(a)-V, O.P.A. Service, p. 200:875: “* * * if the tenant deals with one person (for example, the landlord, the owner of the furniture, or their agent) in renting the accommodations and the furniture, the furniture under most circumstances is part of the accommodations and the rent therefor is subject to the Regulation. A typical case is where the landlord negotiates with the tenant, or in some manner represents the owner of the furniture. The result will be the same where the owner of the furniture conducts the negotiations with reference to the renting of the accommodations as well as the furniture. “Where furnished accommodations are sub-let by a tenant who owns the furniture) there is no separate ownership since the tenant owns both the furniture and the term created by his rental agreement with the landlord. That is, the sub-tenant occupies by virtue of rights given him by the tenant, not by the landlord).”

It is my inclination to agree with this last contention of the plaintiff which is supported by the Administrator. I feel that during the period in 1943 while Beard was the owner of both the term and the furniture, this housing accommodation was a furnished unit and Beard’s failure to register it as such was a violation of the law. Cf. Womack v. Bowles, Em.App. 1944, 146 F.2d 497. However, the petition in the instant case asks for no retroactive relief. Therefore, we are not concerned with violations that may have occurred in 1943.

The same is applicable for the period of January 1, 1944, to March 5, 1945, during which time the lease was at least nominally in Mrs. Beard’s name. By her own testimony her son, who owned and rented the furniture, continued to handle the lease as her agent. According to the Administrator’s interpretation, supra, the furniture under these circumstances, as well as when Beard himself held the lease, would be “connected with the use or occupancy of such property”, the entire unit as furnished would be subject to the rent regulation, and the failure of Mrs. Beard to register the furnished apartment or to have it registered by her son as agent was a violation of the regulation. Cf. Bowles v. Lewis, D.C.,S.D., January 10, 1945, 61 F.Supp. 185, and for gross example of bad faith, collusion, etc., cf. Taylor v. Bowles, 9 Cir., 1945, 147 F.2d 824. Again, however, we are not here concerned with violations that may have occurred in the past. The plaintiff’s petition only asks for injunctive relief for the future.

Viewing relief prospectively, and considering therefore only the present relationships of the several tenants to the landlord Trust Company, the controlling question for decision is whether Beard has transferred his lease to Mrs. Seals, or whether the parties are acting in concert to evade the law. The positive and uncontro-verted testimony of the president of the Trust Company is that both Beard and his mother have been released from all contractual obligation to the Trust Company, that neither of them is longer its tenant, that since March 5, 1945, Mrs. Seals had been accepted by the Trust Company as the tenant and that she pays the rent direct to the Trust Company, Beard and his mother having no control over it. True she pays rent for the furniture also to Beard. But I do not regard that fact as conclusive in determining whether the furniture is “connected with the use or occupancy of” the rented premises. Certainly the Trust Company is not forbidden by the Emergency Price Control Act to release one tenant and substitute another without the transfer of the lease. The right to contract freely is a valuable right protected by the Constitution, and it should not be lightly determined that Congress intended to impose a restraint on the right to contract unless the language of the law is plain and clear to that effect. In this case, Beard really had no lease for a definite term. According to the testimony after Savannah was declared a defense housing area he was merely considered and treated as a tenant at will. He made no effort to transfer any lease, written or verbal, to Mrs. Seals. As already indicated, she was his tenant for a period of time in 1943, and during that period the furniture was connected with the use and occupancy of the property. Perhaps that was true also when Beard attempted to have his mother substituted as a tenant of the Trust Company and the landlord of Mrs. Seals. At least there was unitary control over both the apartment and the furniture during those periods of time. That is no longer true, however. Mrs. Seals is now at liberty to place her own furniture in the apartment or rent furniture for it from another, in either case requiring Beard to remove his furniture, and thus relieve herself from any further obligation to pay him rental therefor. She is no longer his tenant of the apartment; she is the tenant of the Trust Company. The fact that she rents the furniture from a third person, who formerly was also a tenant of the rented premises, is insufficient to make the furniture subject to the same control by the same person controlling the apartment. There having been no formal transfer of the lease, I can not bring myself to believe that there has been any evasion of the law by the old tenant surrendering his term and a new tenant becoming substituted in his place. Nor am I able to find that there has been any concert of action or conspiracy or collusion between the Trust Company on the one hand and the Beards or Mrs. Seals on the other.

Mrs. Seals has not been made a party to this case, and though the defendants M. L. Beard and his mother moved at the conclusion of the oral testimony to make her a party that motion has been denied because not seasonably made. In the absence of Mrs. Seals, as well as for other reasons, I do not attempt in this opinion to fix or determine her rights to recover any excessive rentals from Beard. It was stated on the hearing that it was her purpose to institute an action to recover rentals in excess of the amount fixed by the 'Area Rent Director for the furnished apartment. That action may be instituted in the State courts which have concurrent jurisdiction with this court. Whatever the forum, no effort should be made here to pre-determine the rights of the parties.

It has been suggested in behalf of the Administrator that at this late day I should direct M. L. Beard to file a registration of the furnished apartment because he was the true landlord of Mrs. Seals for the months of October, November and December, 1943. I am of the opinion he should have filed this registration statement. I do not see how filing it at this late day will be of any practical benefit to any of the parties to this case. The Administrator is at liberty to proceed otherwise against Beard for his failure to file a registration within 30 days of the first renting.

It has also been suggested that even at this time the Trust Company and Beard should be looked upon as joint landlords of Mrs. Seals, and that Beard should be enjoined from collecting any further rentals from Mrs. Seals for his furniture or for any other purpose until he has complied with maximum price regulations No. 139 and No. 165 under the Emergency Price Control Act. There are two reasons why I think this relief should not be granted. Beard and the Trust Company are not joint landlords of Mrs. Seals. One is her landlord as to the apartment; the other as to the furniture, if one who rents furniture to another can properly be called a landlord. And the price regulations mentioned were not pleaded in the Administrator’s bill of complaint, and the relief now suggested as appropriate was not asked for in his original complaint. It is conceded that in this proceeding I could not properly enjoin Beard from the violation of price regulations; and therefore I should not attempt to do obliquely that which can not be done directly.

With full recognition that the courts share the responsibility along with the administrator of the “war against inflation,” the facts presented here do not rise to that level which requires the exercise of the court’s discretion in favor of the issuance of an injunction to operate only in futuro. The court is not bound to issue an injunction where the violations have ceased before the hearing. Hecht Co. v. Bowles, 321 U.S. 321, 64 S.Ct. 587, 88 L.Ed. 754; Bowles v. Huff, 9 Cir., 146 F.2d 428. I am quite convinced that the Trust Company and Mrs. Seals are acting in entire good faith. I do not see that either of them has consciously violated any law or regulation up to this time. Mrs. Beard has entirely disappeared as an actor from the scene of controversy. Beard remains only because he holds title to the furniture in the demised premises and collects the monthly rental therefor. If the administrator is of the view that under these circumstances the furniture is connected with the use and occupancy of the apartment rented, so as to bring it within the power to regulate the monthly rental to be paid for the furniture independently, under Sec. 13 (6) of the rent regulations for housing, he should proceed anew to fix the rental value of the furniture disassociated entirely from the rental of the apartment. This he has not yet done.

In my opinion the relief prayed for should be denied and the petition as a whole should be dismissed.

In addition, the petition as against Mrs. Beard should be dismissed on the ground that any participation on her part in the past in the violation of the Emergency Price Control Act has ceased and, so far as the record before me shows, she was an innocent party to the violation.

The petition against the Trust Company should likewise be dismissed. It has never violated nor attempted to violate either the Act or the Regulations. Upon the government’s theory of joint landlords it may not have been improper to join the Trust Company as party defendant, though the cause of action against it could have been more skillfully pleaded, so as to give the Trust Company the exculpation which the administrator now concedes it is entitled to have.

Let a decree be presented on notice.

       50 U.S.C.A.Appendix^ § 925(a): “Whenever in the judgment of the Administrator any person has engaged or is about to engage in any acts or practices which constitute or will constitute a violation of any provision of section 4 of this Act (section 904 of this Appendix), he may make application to the appropriate court for an order enjoining such acts or practices * *

       50 U.S.C.A.Appendix, § 925(c): “The district courts shall have jurisdiction of criminal proceedings * * * and, concurrently with State and Territorial courts, of all other proceedings under section 205 of this Act.” (Emphasis added.)


source: Caselaw Access Project

author: CAFFEY, District Judge.

license: Public Domain

text:
    THE AGWIDALE. THE SAN VERONICO.
    District Court, S. D. New York.
    March 29, 1945.

      To the Honorable the Judges of the United States District Court for the Southern District of New York:
    The report of Wharton Poor, appointed Commissioner by order dated August 18, 1944, respectfully shows:
    The order of August 18, 1944, provides in part: “Ordered, adjudged and decreed that Agwilines, Inc., as owner of steamship Ag-widale and on behalf of any others interested in said vessel, her use and operation, recover of and from Eagle Oil & Shipping Company, Ltd., claimant of motorship San Veronico and her stipulators, 85% of the provable damages sustained as a result of the collision set forth in the libel herein together with interest.”
    On January 29, 1945, there appeared before me counsel for libelant and claimant. Libelant’s counsel offered in evidence a stipulation dated December 27, 1944, as to certain facts and rested; counsel for claimant also rested. Oral argument then took place, after which there were delivered to me briefs and reply briefs in behalf of both parties.
    Libelant was represented by Chauncey I. Clark, Claude E. Wakefield, William E. Collins and Edward A. Neiley, and claimant by Edwin S. Murphy and Helen C. Cunningham.
    The stipulation of December 27, 1944, shows that as a result of the collision referred to in the libel the libelant Agwilines, Inc., sustained physical damage to its vessel, and has made or will make disbursements for repairs, etc., in the total amount of $6,707.78, itemized under nine separate headings. These nine items are not disputed.
    Item No. 10, a claim for demurrage and expenditures for fuel and water, is the only remaining item and is in dispute.
    The controversy is this:
    As a result of the collision the Agwidale was necessarily out of service for nine days, from June 6, 1943, 5 a. m. to June 15, 1943, 5 a. m.; from June 6, 1943, at 8:20 a. m. until June 11 at 3:30 p. m. she was undergoing repairs, and from the last mentioned date until June 15 at 5 a. m. she was waiting for a convoy. During all this period the Agwidale was under time charter to the United States through the War Shipping Administration. Pursuant to the provisions of this charter the United States was under obligation to, and did, pay li-belant half hire during the repair period (Charter party clause 4), full hire during the period while the Agwidale waited for a convoy, and $207.89 for fuel and water. During the repair period libelant paid $240.12 for fuel and water, for which it has not been reimbursed. (Charter party clause 4).
    Counsel for the San Veronico do not dispute liability for the pecuniary loss of the owners of the Agwidale, namely, half hire for the first repair period, and $240.12 for fuel and water paid during this period.
    The advocates for the Agwidale claim that the fact that the owners of the Agwi-dale have been paid part hire during the detention period is res inter alios acta, and that the liability of the San Veronico is not thereby diminished. Consequently, they claim loss of hire for nine days, equal to $10,942.56 and $448.01, the total disbursements for fuel and water, as damage sustained under item 10.
    The case sharply raises a question which has already been before the Courts on occasions, namely, what damages is a shipowner entitled to for loss of use of his ship due to collision when under his charter party hire continues to run and is paid by the charterer?
    A related question was decided by the Supreme Court in Robins Dry Dock & Repair Co. v. Flint et al., 275 U.S. 303, 48 S.Ct. 134, 72 L.Ed. 290. In that case Flint, Goering & Co. were time charterers of the Norwegian s/s Bjornefjord. During the currency of the time charter, it became necessary to drydock the ship for minor repairs and the propeller was removed. Due to the negligence of the employees of the drydock company, the propeller was dropped and broken. A new propeller had to be cast and this caused a delay of several weeks.
    Flint & Co. were relieved from paying hire during this delay under the off-hire clause in the charter, see The Bjornefjord, 2 Cir., 271 F. 682, but nevertheless sustained a heavy loss because the rate of hire due under the charter party was much less than the then current rate. To recover this loss Flint & Co. sued the Robins Company and were successful in the District Court and Circuit Court of Appeals. Judge Mack in the Circuit Court of Appeals held that the time charterers had merely a contract right to the use of the ship, but that this was property which the law would protect against impairment by the negligent act of a third party.
    The Supreme Court reversed the lower courts. In an opinion by Holmes, J., it was said (275 U.S. 308, 309, 48 S.Ct. 135, 72 L.Ed. 290): “as a general rule, at least, a tort to the person or property of one man does not make the tort-feasor liable to another merely because the injured person was under a contract with that other, unknown to the doer of the wrong. * * * The law does not spread its protection so far.”
    The advocates for the Agwidale concede that, in view of the decision in the Robins case, supra, the United States has no direct claim against the San Veronico, but point out that it does not necessarily follow that the hire and disbursements paid by the United States cannot be recovered by the owners of the Agwidale.
    Prior to the decision of the Supreme Court in the Robins case, there had been a decision by the District Court in this circuit that a time charterer was entitled to recover his loss in a tort action from the vessel at fault in a collision, The Aquitania, D. C., 270 F. 239, and a time charterer, had also been allowed recovery of loss sustained by negligent damage to the ship’s mast by a stevedore, Hines v. Sangstad S. S. Co., 1 Cir., 266 F. 502. In so far as these decisions allow the time charterer to recover for negligent damage to his contract right, they are overruled by the Robins case.
    Admitting that the United States has no claim against the San Veronico, the question remains whether the owners of the Ag-widale can recover the hire paid them by the United States and the disbursements made by the United States. I know of only three decisions which could be considered in point, and these are adverse to the right of recovery; none of them are binding on this Court. Before coming to those cases, it seems to me necessary to consider the basis on which damages for loss of use are assessed in collision cases.
    The measure of damages for detention when the ship is under a long term time charter is the hire which the shipowner loses, to which should be added other incidental expenses (fuel, etc.) incurred. The Yaye Maru, 4 Cir., 274 F. 195; The Brand, 3 Cir., 224 F. 391, Ann.Cas.l917B, 996; The Essex Envoy, 18 Asp.M.C.N.S. 54; 34 Ll.L.L.R. 191.
    Market rates are in my opinion inapplicable when the loss sustained is definitely fixed by the contract on which the ship is employed. In any event, there is no evidence as to market in the case at bar and it is even likely that there was no time charter market in June, 1943, because all of the great merchant fleets were under requisition.
    The decisions show that whenever de-murrage is claimed, the Courts scrutinize the proof of the shipowner and allow him only the actual loss sustained. Events peculiar to the particular shipowner, and even of a fortuitous character, may eliminate or reduce a claim for damages due to detention.
    In The Bodlewell, L.R. [1907] P.D. 286, the plaintiff’s ship had been employed by the shipowner, who was seeking to break into a “ring”, in a line. At the time of the collision, cargo was being carried at a cut-rate basis, and the employment of the ship was not remunerative. The shipowner expected admission into the “ring” at a later period and would then earn handsome profits. It was held that, as the ship was being unremuneratively employed at the time of the collision, no demurrage could be allowed.
    In The Susquehanna, L.R. [1926] A.C. 655, an oil tanker belonging to the Admiralty was delayed for a month in making repairs made necessary by a collision. The Admiralty, by economy in consumption, managed to get through their work without the injured tanker. It was held that de-murrage based on what it would have cost the Admiralty to hire a substitute was not recoverable.
    In The York, L.R. [1929] P.D. 178, the s/s Royal City had suffered some collision damage which did not require immediate repair. Some months later, the owners of the Royal City contracted to sell her to Greek buyers, delivery to be made.,at Antwerp not later than February 25th. The Royal City arrived at Antwerp on January 10th. Her cargo was discharged. She was inspected by her buyers while afloat, her engines and boilers were opened up and she was drydocked, all as required by the contract of sale, the buyers taking delivery on February 13th. The collision repairs were begun on January 16th and completed prior to delivery to the buyer. It was held that no damages for detention were recoverable, as the plaintiff had suffered none; the ship would have been detained in any event for the purpose of complying with the sales contract.
    The decisions in our Courts apply the same rule. To recover demurrage the libelant must show that his ship would have been profitably employed during the period of detention. The Loch Trool, D.C., 150 F. 429; The Colombia, D.C., 197 F. 661, affirmed 5 Cir., 199 F. 990. If for commercial reasons or even because of some unusual condition affecting the particular shipowner, i. e., blacklisting, employment would not have been obtained, demurrage is not recoverable. A/S Bonheur v. San Francisco & P. S. S. Co., 9 Cir., 287 F. 679; The Winfield S. Cahill, 2 Cir., 258 F. 318. If a tug owner can handle all of the work available with the remainder of his fleet, he cannot recover demurrage while his injured tug is being repaired. Brooklyn Eastern Dist. Terminal v. United States, 287 U.S. 170, 53 S.Ct. 103, 77 L.Ed. 240. If a ship running in a line with fixed sailing dates is able to make her sailing date, despite her being delayed, no demurrage is recoverable. The Saginaw, D. C., 95 F. 703. There Judge Addison Brown said that the demurrage to be allowed was “indemnity for actual pecuniary loss, and nothing more” (page 704).
    See, too, such well-known cases as: The Conqueror, 166 U.S. 110, 17 S.Ct. 510, 41 L.Ed. 937; The Morristown, 2 Cir., 238 F. 347; The Glendola, 2 Cir., 47 F.2d 206; Navigazione Libera Triastina Societa Anonima v. Newtown Creek Towing Co., 2 Cir., 98 F.2d 694.
    The burden is on the libelant to prove that he has sustained a loss. In the absence of proof of loss there “is not a head of pecuniary damages, for no actual harm was done.” Lord Sumner in The Susquehanna, supra, [1926] A.C. 655 at page 663.
    In the present instance, the libelant has proved a loss of half hire for a little over five days and expenditure in the amount of $240.12 for fuel and water during the repair period. These, in my opinion, are the only amounts which the libelant has lost as a consequence of the detention. The remainder of the hire and the other item of expenditure, for fuel and water,- are the loss of time charterer who is not entitled to hold the San Veronico therefor under the decision in the Robins case.
    If there should be doubt as to the correctness of the above conclusion, it should be dispelled by the decision^ which have dealt with the same, or a similar, situation.
    In The Yaye Maru, D.C.Md., 265 F. 850, a steamer of that name was injured in a collision on November 5, 1919, for which the s/s War Lark was alone at fault. The Yaye Maru was under a time charter, containing the usual off-hire clause to the effect that “in the event of loss of time” due to damage to hull or machinery, hire should cease “for the time thereby lost.” In the collision action, the owners of the War Lark contended that no demurrage was allowable on the ground that hire continued to run during the repair period of six days, for the reason that during all of this period the Yaye Maru was waiting for a government embargo to be lifted so that she could load a cargo of coal; therefore, there was no loss of time to the charterer.
    Judge Rose, then District Judge in the Maryland District, agreed with the War Lark’s contention. He found that the Yaye Maru had not been delayed by the collision and consequent repairs. There was, therefore, he considered, no “loss of time,” and the charterer was liable for the hire during the repair period. He consequently held that the owners of the Yaye Maru, not having sustained a pecuniary loss on account of the ship’s detention, were not entitled to the recovery of demurrage from the War Lark. Judge Rose said (265 F. 851) : “On the 25th of the following January the owner of the Yaye Maru allowed her charterer some $20,000 as off-hire. It is admitted that its action in so doing cannot affect the right's of the War Lark. It is consequently unnecessary to inquire or to speculate as to why the charterer found the owner so yielding, for it may not recover from the War Lark, unless the payment was one the charterer could have compelled it to make.”
    Judge Rose’s decision was reversed on appeal, 4 Cir., 274 F. 195, but the reversal was solely on the ground that the Yaye Maru was off-hire during the repair period. The Circuit Court of Appeals found that there was at least a possibility that the charterer might have sent the Yaye Maru on a voyage at the time of the repair period ; there was consequently a “loss of time so that the Yaye Maru was off-hire while repairing. Demurrage was therefore allowed. Had the Circuit Court of Appeals agreed with Judge Rose in his conclusion that the Yaye Maru was not off-hire, that Court would seemingly have held that de-murrage was not recoverable and affirmed the decree. The Circuit Court of Appeals said (274 F. at page 196): “The primary question is whether the charterer was entitled to this allowance for off-hire under the break-down clause of the contract. Could he have enforced it as a matter of right?” After concluding that the Yaye Maru was off-hire, the Circuit Court of Appeals ended its opinion (274 F. at page 200): “If the owner of the Yaye Maru was bound to allow the off-hire in dispute, it was an element of the damage caused by the wrongful act of the War Lark, and the latter must respond.”
    Chargeurs Reunis v. English & Am.Shipping Co., 1921, 9 Ll. L. L. R. 90 (Admiralty Division), affirmed at page 464, by the Court of Appeals, seems directly in point.
    In that case, the s/s Ceylan, owned by Chargeurs Reunis and under requisition time charter to the French Government, had been injured in a collision for which defendant’s s/s Merida was solely at fault. It appears from the decision that under this charter party the Ceylan’s hire and expenses had to be paid for by the French Government during the repair period. It was held that neither the Chargeurs Reunis (owners) nor the French Government (charterers) could recover from the Merida the hire and expenses that had to be paid by the French Government. In the Court of Appeal Bankes, L. J., said (9 Ll. L. L. R. 464 at page 465) :
    “They (the French Government) had requisitioned the vessel upon the terms of the charter-party. They were the. charterers, and under the terms of the charter-party they were under an obligation to pay the owners certain sums which are named in the charter; and under the terms of the charter they remained liable to pay the owners certain of those sums during the time the vessel was under repair, and they (the Government) could make no use of her. They claimed as damages the loss they had sustained owing to the fact that they had to continue to pay for the vessel, although they were unable to use her during the time she was under repair. Objection was taken to that claim upon the ground that under the charter-party the French Government acquired no more than a contractual right to use the vessel; and if that were their only right, then according to English law they could not claim damages against the wrongdoer who had caused the loss they claimed for, because it has been held and clearly established that in such circumstances no damages are recoverable. The French Government sought to overcome that contention by contending, first of all, that under the terms of this charter-party, having regard to the fact that it was a charter-party entered into under requisition, they were not in the position of ordinary time-charterers, but there was a demise of the vessel to them. Looking at the document itself, I can only agree with the view taken by Mr. Justice Hill when he said:
    “ T arrive at the conclusion that the ship always was and remained in the possession of her owners under the terms of the charter-party, which the owners were obliged to agree to, because the French Government had requisitioned the ship. That being' so, it seems to me that as the French Government were neither the owners of the ship nor in possession of her, all that can be said for the French Government is that they had the use of the ship under a contract, and, therefore, damages to the French Government arise only because under the terms of the contract they continued liable to make certain payments to the owners while getting no benefit from the ship during the period of detention. In those circumstances the French Government had no cause of action arising out of the negligence of the Merida. That means this: that if there is to be any recovery at all it can only be a recovery by the owners.’ ”
    After concluding that the charter was compulsory was immaterial, Bankes, L. J., continued at page 466 of 9 Ll. L. L. R. 464:
    “A second point is taken by Mr. Leek. Fie says that these wrongdoers ought not be allowed to get off so lightly, and that looking at the matter as between the owners of the vessel and the wrongdoers merely, the wrongdoers ought to pay to the full for the damage sustained by their wrongdoing; and he says, for a reason I do not quite follow, from this point of view the owners stand in a better position than the French Government, and although the French Government cannot recover any damages, and although, so far as the wrongdoers are concerned, they, the owners have received from the wrongdoers the whole loss they have sustained, nevertheless, they, the owners, are entitled to say to the wrongdoers 'you must pay something more.’ I confess I cannot follow the argument. It seems to me that if the damages are not recoverable by the French Government because the French Government have no right which alone would entitle them to recover them, it does not lie in the mouth of the owners to say they are in a better position.
    “Mr. Stranger, for the appellants, has further argued that the charter-party is an insurance policy or contract of indemnity, and that if it is either the one or the other the doctrine of subrogation has to be called in aid, and his clients are in a better position if that is done. The short answer is: The charter-party is neither an insurance policy nor a contract of indemnity. It is a charter-party pure and simple, and although payment of hire is expressed in language not familiar in English charter-parties, it remains payment of hire for the use of the vessel, although the French speak of the payment under the heading of indemnity.
    “Therefore, in my opinion, the appeal fails and must be dismissed with costs.
    “Lord Justice Scrutton and Lord Justice Atkin concurred.”
    The Essex Envoy, 1929, 18 Asp.M.C.N.S. 54, 34 Ll. L. L. R. 191, is of the same type as the Yaye Maru, supra. The s/s City of Lyons was detained as a consequence of a collision for which the Essex Envoy was at fault. The City of Lyons was under time charter at the time of the detention. It was argued on behalf of the Essex Envoy that demurrage was not recoverable on the ground that the City of Lyons did not go off-hire. Bateson, J., held that there was loss of time, even if not loss of use, that the City of Lyons consequently went off-hire, and that demurrage was recoverable.
    It seems never to have occurred either to counsel or to Court that the hire should be recoverable whether or not the ship went off-hire, as is now contended on behalf of libelant.
    While The Essex Envoy, supra, is not directly in point, it is at least persuasive that libelant’s theory in the case at bar is rather ingenious and novel than based on commonly accepted legal principles.

      All of the collision cases which resemble the case at bar support the theory of the claimant and are adverse to libelant. All of these decisions were rendered by eminent judges. Libelant has not been able to refer to any collision case to the contrary.
    Libelant has cited three State Court cases in which the suits were to recover for personal injury; two of these were in the Massachusetts courts and one in Wisconsin. In the most recent, Shea v. Rettie, 287 Mass. 454, 192 N.E. 44, 95 A.L.R. 571, suit was brought by policemen for personal injuries. By the rules of the Police Department, injured policemen were entitled to half pay in case of disability. It was held that these payments by the Police Department did not reduce the damages as they were to be regarded as payments under policies of accident insurance. The other cases cited by libelant involved either insurance payments or gratuities.
    On the other hand, counsel for the San Veronico cite Drinkwater v. Dinsmore, 80 N.Y. 390, 36 Am.Rep. 624, where it was stated that an employee could not recover for loss of wages while recovering from an injury due to defendant’s fault if his employer was legally bound to continue payment of wages.
    In my opinion, a contract of personal service differs in many respects from a contract for the hire of a ship, and I have based my decision on the cases involving ships and have not placed reliance on the conflicting decisions in the State Court cases cited..
    If in the case at bar the charter party had provided that the Agwidale was off-hire during the detention, and libelant had held a policy of insurance insuring against loss of time, the San Veronico would have been liable for the full hire and the underwriters would have been subrogated to the recovery. That rule is inapplicable here, because libelant receives hire under a charter party and is not indemnified by underwriters. See judgment of Bankes, L. J., in the Chargeurs Reunis case, supra. This charter party cannot be turned, at the option of the libelant and the United States, into something which it is not. Nor do so-called “equitable” considerations increase the damages which libelant recovers. The law in this class of cases is correctly ruled by the Supreme Court in the Robins case and by the English Court of Appeal in the Chargeurs Reunis case, and no greater measure of damages could be awarded libel-ant on some theory that a larger award would be -more equitable.
    Libelant also cites the salvage cases of The Kanawha, 2 Cir., 254 F. 762, and Castner v. United States, 2 Cir., 5 F.2d 214, where the right of a time charterer to share in a salvage award was recognized. It has always been the policy of Admiralty courts to encourage the rendition of salvage services, and, if, in salvage cases, the rights of the time charterer were disregarded, vessels under time charter would be eliminated as salvors. Salvage claims are based on contract, and have nothing to do with tort. I do not believe that these salvage cases are in anywise of assistance in fixing the measure of damages in a collision case.
    Libelant also argues that there is an analogy in the cases where, in collision suits, the cargo’s share of general average has been collected from the ship at fault.
    It is now the law, both in this country and in the English Courts, that if the carrying ship collects general average from her cargo, the owners of that cargo have a direct claim to recover the amount so collected in a suit against the non-carrying ship or her owners. The Cheldale, 61 T.L.R. 188 (December 1944); A/S Cuzco v. The Sucarseco, 294 U.S. 394, 55 S.Ct. 467, 79 L.Ed. 942, which later case is cited by the libelant. In the case last cited, the Supreme Court said (294 U.S. p. 404, 55 S.Ct. 471, 79 L.Ed. 942), that the right of the cargo to recover “arises directly from the tort.” Such a right to recover has long been recognized in the United States Courts. Ralli v. Societa, etc., D.C., 222 F. 994.
    In Pool Shipping Co. v. United States, 2 Cir., 33 F.2d 275, also cited on behalf of libelant, the shipowner brought suit under private act of Congress to recover for damages sustained in a collision with a Coast Guard cutter. The suit was brought by the shipowner in its own behalf and as bailee of the cargo. It seems very clear that, if the cargo had not paid its contribution in general average, then the items of which that contribution consisted would be recoverable by the shipowner in its own right On the other hand, if cargo had paid, then the shipowner would be entitled to recover cargo’s general average contribution as bailee of the cargo.
    There are very many important differences between the contractual obligation to pay hire under a charter and contribution in general average. The Supreme Court pointed out the distinction in A/S Cuzco v. The Sucarseco, supra, 294 U.S. at page 404, 55 S.Ct. 471, 79 L.Ed. 942. If the shipowner sues as bailee of the cargo, he may no doubt, by long-established precedent, recover physical damage to the cargo and average contribution paid by the cargo which the cargo could recover in a direct suit.
    The time charterer cannot, however, sustain a collision suit to recover hire paid during the repair period and the shipowner cannot sue as “bailee” of the charterer.
    I therefore conclude that, as regards item 10 of the damages, as stipulated, libelant is entitled to recover no more than 85% of the hire for the first period, amounting to $3,216.91, and 85% of $240.12 for fuel and water, for which amount libelant has not been reimbursed by the charterer or otherwise.
    I adopt as my findings of fact the contents of the stipulation between the parties through their proctors, dated New York, December 27, 1944, marked Exhibit 1, constituting all of the evidence introduced at the hearing, and my conclusion of law is that libelant is entitled to recover 85% of the total of items 1 to 9 and also 85% of $3,457.03 under item 10, all with interest as stipulated, except for interest on item 10 which should apparently run from July 1, 1943, see charter party, clause 3.
    Subject to the approval of the Court, I fix my fee as Commissioner at $500. Proctors for libelant and claimant inform me that they consider this figure satisfactory. I certify that my fee as Commissioner has not been paid upon the filing of this report.
    All of which is respectfully submitted.
    Burlingham, Veeder, Clark & Hupper, of New York City (Chauncey I. Clark, of New York City, Claude E. Wakefield, of Washington, D. C., William E. Collins, of New York City, and Edward A. Neiley, of Washington, D. C., of counsel), for li-belant.
    Kirlin, Campbell, Hickox & Keating, of New York City (Edwin S. Murphy and Helen C. Cunningham, both of New York City, of counsel), for claimant of the M. V. San Veronico.
   CAFFEY, District Judge.

The libelant' excepts to the commissioner’s report. The claimant moves to confirm it.

I. In 1943 the Agwidale, owned by the libelant, collided with the San Veronico. The parties agreed that the San Veronico would be liable for 85% of the provable damages of the Agwidale suffered as a result of the collision. The stipulation was embodied in the order appointing the commissioner to determine the damages. The commissioner heard a stipulation as to the facts, heard argument and assessed damages. I adopt his opinion.

II. The libelant has excepted to only one item in the report. That deals with the damages from the detention of the ship. In determining the damages from detention the commissioner took into consideration the charter party under which the United States, not a party to the action, was time charterer of the ship. He found that the charter party provided for payment of half hire during the repair period and of full hire while the vessel was waiting for a convoy and that these sums were paid. Accordingly, he fixed as damages for detention only the half hire during the repair period which had not been paid by the charterer.

The libelant contends that the commissioner should not have considered the charter hire paid by the United States and that he should not have ruled that the measure of damages for detention when a vessel is under a long time charter is the hire which the vessel owner loses. Instead, the libelant contends that the commissioner should have ruled that the measure of damages is the value of the use of the ship to the owner, the charter rate of hire being prima facie evidence of such value to be taken as the yardstick in the absence of any other evidence.

All of the exceptions raise only one question. That is this: Was the commissioner correct in considering the amount of hire actually paid by the charterer during the period of detention in determining the damages suffered by the libelant?

III. The case of Chargeurs Reunis Compagnie Francaise De Navigation A Vapeur (“Ceylan”) v. English & American Shipping Co., 9 Ll. L. L. R. 90, affirmed 464, is squarely in point. In that case the French Government had time-chartered a ship owned by the Chargeurs Reunis under a wartime requisition. The ship collided with one owned by the English & American Shipping Company, which was found liable. The charter party provided for payments of hire during the period of detention for repairs and the payments were made. On appeal it was said: “The question [in the lower court] was whether the French Government could in their own name, or in the name of the shipowners, maintain a claim for damages in respect of the period of detention”. Chargeurs Reunis casé, supra, 464. The Court of Appeals squarely-held that the French Government could not maintain a.suit for such damages nor could the shipowners collect the amounts of hire paid by the French Government. In support of that view the statement of Lord Justice Bankes on appeal was this (p. 466) : “It seems to me that if the damages are not recoverable by the French Government because the French Government have no right which alone would entitle them to recover them, it does not lie in the mouth of the owners to say they are in a better position.”

This case clearly disposes of the contentions of the libelant.

IV. The British case is in line with the holding by the Supreme Court of the United States that the rule for damages in admiralty causes is the actual pecuniary loss. The Conqueror, 166 U.S. 110, 126-127, 134, 17 S.Ct. 510, 41 L.Ed. 937. The same proposition is sustained by the Circuit Court of Appeals for this Circuit. Navigazione Libera T. S. A. v. Newtown Creek T. Co., 2 Cir., 98 F.2d 694, 698-699. It is also supported by numerous other Federal decisions, as well as by a leading case in the Court of Appeals of New York. Drinkwater v. Dinsmore, 80 N.Y. 390, 392, 393, 36 Am.Rep. 624.

V. The libelant argues that Pool Shipping Co. v. United States, 2 Cir., 33 F.2d 275, controls the decision in the case at bar. In the Pool case the court refused to consider general average contributions to the shipowner in mitigation of the damages he might collect from the party injuring his ship. It held that the contributions were like insurance and that the payment of a contribution subrogated to the contributor the right to sue to that extent.

But the payment of charter hire during a period of repair is not a payment of insurance. The amount to be received is fixed by agreement between the parties beforehand and has no relation to the actual damages or to their cause. Furthermore, the charterer has no cause of action against the party damaging the ship. There is no subrogation. Robins Dry Dock & Repair Co. v. Flint, 275 U. S. 303, 309, 48 S.Ct. 134, 72 L.Ed. 290; Chargeurs Re-unis Compagnie Francaise De Navigation A Vapeur (“Ceylan”) v. English & American Shipping Co., supra, 9 Ll. L. L. R. 465, 466.

VI. The libelant argues also that the doctrine in Massachusetts, that the negligent party in a personal injury suit cannot use payments made to the injured person by other persons to diminish the amount of his liability, is applicable. Shea v. Rettie, 287 Mass. 454, 192 N.E. 44, 45, 46, 95 A.L.R. 571; Elmer v. Fessenden, 154 Mass. 427, 28 N.E. 299. The principle of those cases is fully met by the contrary New York holding. Drinkwater v. Dinsmore, 80 N.Y. 390, 392, 36 Am.Rep. 624. But the cases mentioned are not really applicable to a technical admiralty situation.

VII. Since the first exception of the libelant raises the question of the day from which the damages ran, I approve the finding of the commissioner that the date is that of the next payment of the charter hire under the charter party rather than the date of the collision.

The amount of the commissioner’s compensation agreed on by counsel is approved.

Exceptions overruled. Report confirmed.

Settle order on notice.


author: MOORE, District Judge.

text:
    UNITED STATES v. CERTAIN LANDS IN ST. CHARLES COUNTY, MO., KNOWN AS WELDON SPRING AREA.
    Nos. 765, 767, 771, 777, 781, 785, 791, 797, 805, 807, 810, 811, 817, 827, 835, 841, 865, 874, 875, 877, 985, 987, 991, 995, 997, 1000, 1001, 1010, 1015, 1021.
    District Court, E. D. Missouri, E. D.
    June 8, 1945.

      Harry C. Blanton, U. S. Atty., of Sikes-ton, Mo., and M. Walker Cooper, Sp. Asst. U. S. Atty., and Russell Vandivort, Asst. U. S. Atty., both of St. Louis, Mo. (J. Edward Williams, Acting Head, Lands Division, and Victor C. McCrea, Atty., Department of Justice, both of Washington, D. C., of counsel), for plaintiff.
    William R. Gentry, Samuel M. Watson, William R. Gilbert, Harry Richards, William H. Allen, Igoe, Carroll, Keefe & Coburn, and Robert P. Elam, all of St. Louis, Mo., Webster Karrenbrock, B. H. Dyer, and Theodore C. Bruere, Jr., all of St. Charles, Mo., Redick O’Bryan, of St. Louis, Mo., and Caldwell, Downing, Noble & Garrity and Adams, Adams & Adams, all of Kansas City, Mo., for defendants.
   MOORE, District Judge.

All of these cases, except Numbers 807 and 874, now come before this Court on motions filed in each by the plaintiff, United States of America, for entry of judgment in the amount of the compensation fixed in certain option contracts, but without interest thereon, and certain counter-motions by defendants asking for judgment with interest on the principal amounts since the date of taking. Numbers 807 and 874 (Muschany and Andrews cases) are here on motions by the plaintiff to delete interest from judgments already entered, but the issues therein presented differ only slightly. This opinion is to be considered as filed in and ruling all of the above numbered separate proceedings.

The lengthy history of this condemnation litigation is already adequately documented in the Reports and needs no further recitation. The facts of the original proceedings appear in the contrary opinions of District Court Judges Davis and Collet, United States v. Certain Land Situate in St. Charles County, Mo., et al., D.C., 46 F.Supp. 921, and United States v. 94.68 Acres of Land in St. Charles County, Mo., et al., D.C., 45 F.Supp. 1016; in the Eighth Circuit Court of Appeals opinion in United States v. Muschany, 139 F.2d 661; and in the opinion of the Supreme Court of the United States in Muschany v. United States, 324 U.S. 49, 65 S.Ct. 442. In addition, the facts surrounding the present motions are ably stated in the opinion of Judge Hulen filed in Division No. 2 of this Court on the 4th day of May, 1945, 60 F.Supp. 741, covering identical motions in companion cases to those now before this division. The issues here presented differ in no respect from those decided by Judge Hulen and, with the above references to source materials where the facts may be found, the Court will state its views and holding on the issues presented, which, I deeply regret, are not in accord with those of my learned brother Hulen.

After careful consideration of the various submitted briefs of counsel, the real issues presented for decision appear to be four in number: First, the question is raised whether there is anything in the facts of these cases that makes them a particular type of condemnation proceeding.to which that part of the Statute allowing interest to landowners does not apply; second, whether if in such a condemnation proceeding interest is ever allowable, these landowners have by any contract, election, waiver, stipulation or option done anything to waive, give up, or bar themselves from, a right that they might otherwise have; third, whether, if the landowners are entitled to interest, they are entitled to it from the date of the actual taking or only from the date of the filing of the declaration of taking; and, fourth, whether the original decrees entered only in the Andrews and Muschany cases (those appealed to the Supreme Court), which expressly provide for interest, are final and binding on the interest issue in those two cases and, also, binding as precedent or through special agreement of the Government in all the other cases. The Court will discuss the above issues seriatim.

There is no dispute between the parties that the general rule is (absent a contract or statute evincing a contrary intent) that interest does not run against the United States upon claims or contracts even though there has been an unreasonable delay or default in the payment of the principal upon the part of the Government. Tillson v. United States, 100 U.S. 43, 25 L.Ed. 543; United States v. North America Transportation & Trading Co., 253 U.S. 330, 40 S.Ct. 518, 64 L.Ed. 935; United States ex rel. Angarica de la Rua v. Bayard, 127 U.S. 251, 8 S.Ct. 1156, 32 L.Ed. 159; United States v. State of North Carolina, 136 U.S. 211, 10 S.Ct. 920, 34 L.Ed. 336; Smyth v. United States, 302 U.S. 329, 58 S.Ct. 248, 82 L.Ed. 294, 114 A.L.R. 807. Likewise, there is no dispute that in ordinary condemnation proceedings an exception is made which Congress has by statute approved and codified. 40 U.S.C.A. § 258a; Seaboard Air Line R. Co. v. United States, 261 U.S. 299, 43 S.Ct. 354, 67 L.Ed. 664; United States v. Rogers, 255 U.S. 163, 41 S.Ct. 281, 65 L.Ed. 566. The parts of said Statute material here are:

“In any proceeding in any court of the United States outside of the District of Columbia which has been or may be instituted by and in the name of and under the authority of the United States for the acquisition of any land or easement or right of way in land for the public use, the petitioner may file in the cause, with the petition or at any time before judgment, a declaration of taking signed by the authority empowered by law to acquire the lands described in the petition, declaring that said lands are thereby taken for the use of the United States. * * *
“Upon the filing said declaration of taking and of the deposit in the court, to the use of the persons entitled thereto, of the amount of the estimated compensation stated in said declaration, title to the said lands in fee simple absolute, or such less estate or interest therein as is specified in said declaration, shall vest in the United States of America, and said lands shall be deemed to be condemned and taken for the use of the United States, and the right to just compensation for the same shall vest in the persons entitled thereto; and said compensation shall be ascertained and awarded in said proceeding and established by judgment therein, and the said judgment shall include, as part of the just compensation awarded, interest at the rate of 6 per centum per annum on the amou/nt finally awarded as the value of the property as of the date of taking, from said date to the date of payment; but interest shall not be allowed on so much thereof as shall have been paid into the court. No sum so paid into the court shall be charged with commissions or poundage.
“Upon the application of the parties in interest, the court may order that the money deposited in the court, or any part thereof, be paid forthwith for or on account of the just compensation to be awarded in said proceeding. If the compensation finally awarded in respect of said lands, or any parcel thereof, shall exceed the amount of the money so received by any person entitled, the court shall enter judgment against the United States for the amount of the deficiency.” (Emphasis the Court’s)

The difference of opinion between the parties first arises on the question of whether the particular facts here cause these proceedings to be a type of condemnation proceeding to which that part of the statute relating to interest is inapplicable.

The Court is of the opinion that under the policy of Congress, as expressed by the above statute, and under the facts, there is no valid reason why these landowners should not receive the benefit of the statutory exception. It is true that the negotiations between the Government and the landowners originally resulted in option contracts. It is also true that those contracts provided for condemnation proceedings under certain restricted circumstances. Those facts, however, do not change the circumstance that there are now before this Court condemnation proceedings brought under the general condemnation statute and in no respect different from any other like proceedings except in the method of ascertaining the value of the land. These are not friendly condemnation proceedings for the purpose of clearing title but, as the long history of litigation prior to these motions will readily prove, they are as completely antagonistic and adversary actions as this Court has ever seen. These proceedings for condemnation were certainly not brought within the terms of the option contracts, since those options provide only for friendly proceedings “if for any reason the title to the land is not approved by the Attorney General.” It is certain that no other type •of condemnation proceeding was within the contemplation of the parties when the option contracts were entered into. The history of these cases shows that the Government brought these actions as straight adversary condemnation proceedings, in complete disregard of the option contracts, and that the entrance of those contracts into the issues was by way of equitable defense on the part of the landowners. Those option contracts have played a part, therefore, in these proceedings to the extent of fixing the worth of the land, but it would be completely erroneous to say that they in any way make these a different type of condemnation proceeding, or that those options have been specifically enforced in their entirety.

Such being the facts, no reason appears on the face of the Statute why these landowners, different from any other landowners, should be divested of the right to interest on the deficiencies of their awards. The statute merely provides that “said compensation shall be ascertained and awarded in said proceeding and established by judgment.” No distinction is made in the statute between different methods of ascertaining the compensation. Had the value of the land here been found by a jury, by commissioners, or by stipulation filed in the case, the statute in the absence of express waiver would make no distinction in regard to interest in any case where a deficiency in the deposit existed. Why, therefore, should there be any distinction because the value of the land was fixed by an agreement prior to suit between the parties, which agreement, it should be noted, was enforced against a recalcitrant Government on equitable principles ?

These landowners certainly come within the spirit of the statute and the intent of Congress. The history of the statute, as admitted by the parties, shows that its purpose was to grant interest not as interest, but as part of the compensation, i.e., to compensate for the loss of the use of the land, or the use of the value thereof in money, pendente lite, Seaboard Air Line R. Co. v. United States, supra; United States v. Rogers, supra. The properties of these people were taken from them some time prior to the institution of these suits and only since submission of the present motions has the Government begun to deposit the full amounts due under the options. Thus, they have lost both the use of the land and the use of their money, and it was just such a situation as this that Congress intended to remedy by making the unusual exception to the rule that the United States pays no interest.

To say that this is a different type of condemnation proceeding pursuant to contract is to ignore the fact that the contracts never have been enforced in full and never will be. The original proceedings were not suits for specific performance of the contracts because, had they been, the result should have been the dismissal of these actions. On equitable principles the amount of compensation was fixed and charged against the United States under the terms of the options, but the United States itself has defaulted and still defaults on many of the terms of the contracts. For example, it has not — as the contracts provided — accepted deeds and paid the agreed purchase price upon the furnishing of satisfactory certificates of title. That it can and will never do. Neither has it brought condemnation proceedings for the sole reason assigned in the options for doing so. Nor has it, when bringing condemnation proceedings, followed the terms of the contracts, which provide that—

“The Government will proceed to acquire the land by condemnation proceedings instituted in the District Court of the United States in which said property is located, under a consent verdict fixing the award at the agreed valuation and in accordance with all the terms and provisions of this option and will upon filing its petition in such proceedings deposit said agreed purchase price with the clerk of said court.” (Emphasis the Court’s)

The requirement for a deposit upon the filing of the petition has certainly never been performed by the Government and never can be. The Government has made no offer to consent to a verdict and yet, through its Agents, contends that it simply wishes to go through with the original contract. That, it is manifest, is impossible.

The essential error in the position of the Government lies in the assumption that the effect of the opinion of the Supreme Court was to convert these condemnation proceedings back to simply technical processes for the perfection of title in a proceeding contemplated by the parties and within the terms of their contracts; or, stated in another way, to convert these proceedings into an identity with an action in the Court of Claims for specific performance of a contract. This argument erroneously assumes, first, that the Supreme Court had the power and desire to restore the status quo ante; secondly, that by striving and prevailing for the prices promised them by their Government (in the adversary proceeding forced upon them) these landowners somehow bound themselves to all the concomitants of a discarded contract procedure and simply turned back the clock some years, thereby wiping out all that had intervened; and, thirdly, that there is something inconsistent in allowing the landowners their promised price as a matter of equity and also giving them the benefits arising solely by statute from a method of procedure which was forced upon them by the Government. The reasons why the prices provided in the options were compulsorily imposed upon the Government by the Courts are that it was felt unconscionable and contrary to public interest to allow the Government, after accepting unusual benefits, to renege on its solemn word, and justice demanded that the landowners be given by way of-ascertainment of value in condemnation that which they would have received had not the Government breached the contracts. In other words, there is actually nothing in the record of this case to show that the contracts per se were to be enforced. The Government was merely allowed to follow its chosen and elected course subject only to the duty to give the promised price. Any concomitants arising, however, from that elected course (i.e., interest) were not negatived or touched upon. Since, therefore, the Government has elected its remedy of condemnation, this Court can see no valid distinction between these proceedings and any others, unless there is something in the record to show that the landowners here have waived a right that they might have otherwise possessed. The Court will next address itself to that question.

The option contracts involved in these cases can be the only evidence of any such waivers or elections; and the Government here makes no contention that any circumstances other than those contracts constitute any such waivers or agreements. Thus, the question simply is, did the landowners by entering into such option contracts thereby stipulate and agree that no matter what happened the sums therein specified should be the total compensation for their lands? This Court, in answer to that question, can find nothing on the face of those option contracts, or from the surrounding circumstances, to indicate any such intention on the part of the landowners, or, for that matter, the Government. Had the contracts been performed, either by conveyancing or by a friendly condemnation proceeding, as provided in the options, the argument advanced by the Government might have strength. But, as it was, the parties were contracting for the sale of their land and they naturally made no provision for interest. Had the contracts been performed in the manner contemplated on their face they would have needed no interest and been entitled to none. However, those contracts were not executed and never will be. How, therefore, can it be said that agreements to take no interest under the condemnation statutes can be found in contracts whose subject matter was something totally different than the proceeding that was subsequently brought ? At the time the option contracts were executed the present proceedings were certainly not in the minds of any of the parties, and their possibility is no where reflected in those contracts. The landowners stated what they would take for their land in certain eventualities, which eventualities were the delivery of deeds in return for money (or, a friendly title clearing condemnation in a certain event). Neither of these eventualities ever occurred, but a totally different, completely unforeseen and most unwelcome litigation was commenced. The general law of contracts would certainly forbid a holding which bound a contracting party by an instrument the subject matter of which was entirely different. The Government not the landowners, breached the contract, and that contract is dead and will never be performed except that the landowners, by reason of the final holding of the Supreme Court of the United States, will be put in a monetary way in the same position as if the contracts had been executed. The question of interest in this adversary condemnation proceeding is not within the four corners of the contract at all, and is to be determined by operation of law.

Argument has been presented in behalf of the landowners that even if the option contracts could have some relevancy to the question of interest under the condemnation statute, that they have relevancy only to the extent that in condemnation they show an intent to fix the value of the land but not the total compensation therefor. This argument is based on the contention that there is a difference in condemnation between the words “value” and “compensation,” and that the word “compensation” includes not only the value found by the trier of the facts but also any additional items required by law, such as the statutory interest. A decision on this problem, in view of the preceding statements of this opinion, is, of course, not necessary, since the Court has already decided that the contracts have no bearing at all on the interest question. However, the Court wishes to point out that it is in agreement with this contention insofar as it believes that if by any stretch of the imagination it can be held that the parties were contracting in contemplation of an adversary proceeding in condemnation, then they were contracting only to the extent that they were fixing the value of the land in the same manner that Commissioners or a Jury would fix the same, and without any stipulation to cover the entire condemnation proceeding (including matters like interest, which are handled by operation of the Statute). The option contracts, when they speak of the contemplated friendly condemnation to clear title, provide for “a consent verdict fixing the award at the agreed value.” They further provide for an immediate deposit of that valuation. Certainly, under the terms of the Statute where the Government agrees to and does deposit an agreed valuation there can be no question of interest. With this in mind the landowners’ agreement to a value would have constituted their entire compensation because of the contemporaneous agreement of the Government to instantaneously pay in that value and cut off the right to interest. Nowhere, however, can words be found that show a contemplation by the landowners that they are fixing the possible total compensation that they would take in condemnation regardless of whether the Government, in accordance with its mutually dependent promise, paid in the money subject to the landowners right of user.

It should be noted, before turning to a consideration of the remaining stated issues, that the Court has found, after consideration of the various authorities cited, no binding authority on the previously discussed issues, and feels that in its decision interpreting the Statute under the facts the Court must and is at liberty to arrive at its conclusions independently. All of the authorities cited by the Government to the effect that interest is generally not allowable against the United States, except where contract or statute so provides, are of interest, but actually of no assistance to the Court in the cases at bar.

The only authorities relied on by the plaintiff that the Court has found to even touch upon the propositions here are United States, v. 3.25 Acres of Land in Seneca County, New York, 53 F.Supp. 884, and United States v. Certain Lands in St. Louis, 58 F.Supp. 305, both District Court cases, and the latter decided by Judge Duncan of this District. Although neither is in any way decisive, since their special applicability has been strongly urged, a statement of the Court’s views on them is made necessary.

The Court believes that the issues involved in the case before Judge Duncan were not at all the same as those here presented and that that case is so distinguishable as to be of no value as even influential authority. That suit was begun as an ordinary adversary condemnation, but while pending a proposition was made by the owner of the land for settlement of the case. A settlement was agreed upon, accepted, and a judgment rendered for the exact amount of the contract. A motion was filed by the landowners asking for interest from the time of the entry of judgment until payment, on the theory that the Government had unreasonably delayed the payment. Interest was denied by the Court. First, it should be noted that the interest question arose from a demand for interest after entry of judgment, and not before. Second, the contract, in the form of an accepted offer of settlement filed in the case, provided that—

“The consideration hereinabove set forth shall be the amount of the award to be decreed for all damages and compensation by reason of the taking of said lands by such judicial proceedings and we hereby agree that this offer to sell, if accepted, shall, without more, constitute a stipulation, which may be filed in said suit as final and binding evidence of the award to be made in such proceedings and paid into Court for the benefit of all persons entitled thereto.”

Thus, when the contract was made, an adversary proceeding was not only in mind but was actually the subject matter of the contract. That contract was a compromise, and that with which they were dealing was well within the minds of the landowners. If they agreed to accept the sum named in the settlement for “all damages and compensation” they would certainly be presumed to include in their computations of what they would take not only the original value of the land but any other claims they might have had to that date against the Government, such as interest (or compensation for the deprivation of use pendente lite). 58 F.Supp. loc.cit. 307, Judge Duncan states:

“The difficulty with defendant’s position is that by its own action it removed itself from the provisions of the statute. If this statute were applicable here, defendant would be entitled to interest on $35,000 from the date of taking on June 19, 1939, until the date of the payment, August 14, 1944, but defendant makes no such claim. On the contrary, it bases its claim upon the ground of unreasonable delay in the payment of the amount agreed upon, and for which judgment was entered. It could make no other claim in view of the clear, unambiguous statement in its offer that: ‘ * * * the amount of the award to be decreed for all damages and compensation by reason of the taking of said land * * *.’ (Emphasis supplied.)
“From this language it must be determined that the defendant’s offer was a full and complete offer, not one fixing an amount as of the time of taking, but as of the time of the acceptance and payment.”

From the above quotation it can be clearly seen that the real basis of decision was a finding of fact that the landowners had voluntarily given up and waived any right they had, and that is just exactly what this Court finds that the landowners in the cases at bar did not do. There is no difference'to be found in that opinion as to the law, there is simply a factual situation not here present. It should also be noted about -that case, that there the landowners did not petition clearly for interest under the statute, but went outside of it relying on alleged unreasonable delay, and, as before noted, it is clearly the law that no matter how arbitrary or unreasonable the delay and how great the hardship imposed, the United States may not be forced to pay interest absent a statute or contract providing therefor. That case was decided on its facts, and the facts in the cases at bar are in no way identical.

The other District Court case, United States v. Certain Lands in Seneca County, New York, supra,' may be more in point, it is true, but still is essentially distinguishable from the cases at bar for the same reason as Judge Duncan’s opinion. Although the exact fact situation present in that case is not made clear by the opinion, it should be noted that Judge Burke seemed to be of the very definite view that that proceeding was brought completely within the terms <of the option contract, and not, as in the cases at bar, in derogation and denial of those contracts. The option provided, as here, for friendly condemnation to clear title and although the opinion does not show the Government’s motive in bringing the matter to Court, surely it must be presumed, since Judge Burke seems to so imply, that the action was brought within the rights given by the contract. All through the opinion appears the assumption that a proceeding contemplated by the option had occurred and that, therefore, the contract should bind. This is best illustrated by .the very words of the Court, 53 F.Supp. loc.cit. 885:

“By agreement of the parties, therefore, it was left to the determination of the United States, through its officers in charge of the matter, to determine, notwithstanding the prior acceptance of the option, whether the title was unsatisfactory for purchase by deed. By express agreement the Government had the right, at its election, to acquire title by condemnation and the church agreed in that event to cooperate to that end and the option price was to constitute conclusive evidence of the true value of the whole property. When reasonably and fairly exercised, as it appears to have been in the light of the matters set forth in the motion papers, the determination to acquire title by condemned tion is not open to question cmd when resorted to, the express agreement of the parties as to compensation must control. That agreement was that the option price ‘shall be final and conclusive evidence of the true value of the whole of said property and of the proper award to be made in such proceedings’. The possibility of the Government electing to acquire title by condemnation was not an unforeseen circumstance and in such event, that there would be some delay in the proceedings, might reasonably have been inferred. The option, however, contained no provision for adding anything to the award to conipensate for delay in the payment of compensation. The court may not supply what the parties themselves have failed to include in the agreement.” (Emphasis the Court’s)

That being the situation, the case can give no assistance where, as here, the Government itself departs from the contract, and makes its performance impossible, and does not exercise any contract right, in the words of Judge Burke, “reasonably and fairly”.

Attempts have been made to show guiding principles in the Supreme Court opinion in Muschany v. United States, supra. The Court, however, can find no guidance therefrom and is certain that any language of the Supreme Court that has been used by either of the parties to this suit to justify their conclusions is not pertinent, since it is only too clear that the Supreme Court of the United States was in no manner addressing itself to the issues now raised by these motions.

Since the submission and briefing of these motions this Court’s attention has been directed by defendants to the decision of the United States Circuit Court of Appeals for the Fifth Circuit in United States v. Baugh et al., 149 F.2d 190, decided May 4, 1945. As in Judge Duncan’s opinion in United States v. Certain Lands in St. Louis, supra, the suit was commenced as an ordinary condemnation and a stipulation was subsequently filed. The Fifth Circuit held that the landowners were entitled to interest from the filing of the stipulation until deposit. United States v. Baugh et al. is of interest not because it necessarily expressly rules the issues here, but because it contains thought closely allied to this Court’s holding. The stipulations there waived hearing before commissioners, consented to decrees vesting title, and agreed that certain sums be adjudged as just compensation. They further read—

“The foregoing stipulation is made to expedite the vesting of title in the plaintiff, the United States of America, and the payment of just compensation for such lands to the owners thereof, and it is the purpose and intent hereof to vest in the Court, without any further proceeding and notice, full authority to close such action by final judgment and to disburse the funds in accordance therewith.”

After the filing of these stipulations an eight months’ delay ensued before deposit by the Government, although possession had been taken \yhen suit was commenced. Judge Waller discusses the effect of these stipulations, 149 F.2d loc.cit. 192, and the quotation suffices to illustrate the analogous reasoning to this Court’s:

“In the present case the Government did not take a deed from the landowner as in an outright purchase, but it acquired title and possession by condemnation. The stipulation merely had the effect of relieving the Government from having to make proof as to what was just compensation and of running the risk of having an amount fixed which might be unsatisfactory. The stipulations eliminated controversies, but otherwise the condemnation suit proceeded to final judgment. There is no mention in the stipulations that interest was, or was not, included. Just compensation in condemnation censes means just compensation at the time of taking of possession, and when the parties reduced to writing a stipulation fixing just compensation there seems to be no reason to conclude that the landowner impliedly waived any legal right. In view of the- several express waivers made in the writing it will not be presumed to have contained any implied waivers of substantial constitutional rights.” (Emphasis the Court’s)

Again, the learned Judge says, 149 F.2d loc.cit. 193:

“But the Government failed to pay for seven or eight months thereafter, and there is neither proof nor presumption that the landowners intended to waive interest in the future, particularly for such an indefinite and unreasonable period, and such a waiver cannot be read into the agreement. Their right to have interest is found in the Constitution and is neither found nor lost in the contract.
“The Constitution no more permits the deprivation of money without just compensation than it does the deprivation of the use of land without just compensation.” (Emphasis the Court’s)

Although the facts are different, the case is sound authority for this Court’s holding that where a contract fixes the value of the land, the presence of such contract does not affect the matter of interest, which is governed by operation of law.

It is further of interest to note that the Court, in United States v. Baugh, states, 149 F.2d loc.cit. 193:

“The settled law of the land at the time a contract is made is a part of the contract and must be read into it.”

This is in direct answer to the plaintiff’s underlying argument in the cases at bar that the contract upon which an award is based must provide for interest for it to be allowable. It would seem, however, that the rule is, to the contrary, that a contract is presumably made in view of the law existing (which gives a right to interest), and if this presumption is to be altered the contract must so provide.

The third issue, as above stated, is whether, having decided that the landowners are entitled to interest, they are entitled to interest from the date of actual taking of the land, or from the date of the filing of the declaration of taking in this Court. Here, it is the Court’s opinion, that the latter date must govern. Although it is true that the Government went into possession of these lands sometime prior to filing of these condemnation suits, and withheld the use of the land from the landowners during that intervening period, it is also true that the right in the landowners to interest now is bottomed upon the Statute. This Statute is in derogation of the general rule that no interest is allowable against the sovereign, and strict conformity must, therefore, be required in the application of the exception to these cases. For any loss of the use of their lands after the actual taking but prior to the filing of the declaration of taking, the landowners right lies outside of the condemnation laws and in contract, and they must, therefore, go uncompensated in the same manner that persons dealing with the sovereign in matters other than condemnation receive no interest.

Finally, considering the fourth issue, it has been argued that since the original decrees, entered in the Muschany and the Andrews cases (those appealed to the Supreme Court), provided a judgment for the principal amount of the options plus interest, and since those decrees have been affirmed by the Supreme Court of the United States, that the question of interest is res adjudicata in these cases at least. Additionally, it is argued in this line, that those decrees form influential or binding precedent for all of the other cases and that, further, because of some commitment by counsel for the Government the landowners in the other cases are entitled to the same treatment in all respects as Mu-schany and Andrews.

The question of whether interest is res adjudicata in the Andrews and Muschany cases depends essentially on whether those decrees were, in the form written, affirmed by the Supreme Court, or whether they were made subject to revision or re-entry. The Circuit Court of Appeals, of course, reversed the findings and decrees in those cases, which would have the effect of setting the same aside. The Supreme Court, however, reversed the Court of Appeals and in its mandate ordered that the Muschany and Andrews cases be remanded to the District Court for further proceedings in accordance with its opinion. Although it is true that the Supreme Court did not expressly state that the decrees in the form written were affirmed, it appears that such is the undoubted effect. A reversal of the Court of Appeals must, of necessity, reinstate the rule of the District Court if nothing more is done. The order of the Supreme Court, remanding to the District Court for further proceedings in accordance with its opinion, can only mean that since the opinion was in accord with the District Court that that latter court should proceed as it had been proceeding prior to appeal. Although the language of the Supreme Court’s mandate may not be expressly an affirmance, it cannot be interpreted in any other way, since there are no further proceedings to be had other than execution of the judgments previously entered.

The Court recognizes, however, that the issue of interest was not raised before either of the appellate courts, and that neither opinion adjudicates that question. However, that is not the fault of the landowners since the original decrees gave them interest, and those decrees became final unless attacked and set aside on appeal. In view of the Court’s holding on the other issues previously discussed in this opinion, a decision of the present issue is, of course, not necessary in order to hold with the landowners. However, the Court feels that so far as the Andrews and Muschany cases are concerned justice requires that the landowners be given the benefit of the Government’s failure to seek reversal of the decrees already entered in their favor. The Government, it appears to this Court, participated in an appeal through two courts, alleging error committed by this court. The question of interest was squarely present in the record and the Government could have attacked that during the same appeals. Now, however, having been defeated on the question of the validity of the option contracts the Government seeks to pick another point jn the original decrees which it believes erroneous and attack the landowners on that. Such procedure certainly is violative of all tenets of appellate procedure.

As for the effect of this upon the other cases in which no decrees were entered, it certainly cannot be said that the opinions of the Supreme Court in the Muschany and Andrews cases form any precedent on the interest question. The issue of the interest awards not having been attacked on appeal, and the opinions of both the Court of Appeals and the Supreme Court being absolutely silent thereon, it would, indeed, be erroneous to say that because the Government neglected to allege an error and obtain a decision on the interest provisions in the Muschany and Andrews decrees that they have thereby made binding or even influential law for other cases.

However, aside from that question, there is the suggested commitment of the Government, which would cause all other cases to follow the exact result of the Andrews and Muschany cases. This Court feels that in all probability good conscience might dictate that all landowners should be given the same treatment as those in the test cases, since they doubtless failed to press their cases to judgment in reliance on an assumption that all cases would result identically. However, the Court further feels that no agreement by the Government intended to cover the question of interest has been shown and is, therefore, not disposed to hold that the Government is bound in that regard. Adequate reasons have been stated elsewhere in this opinion for allowing interest to all landowners, and the Court, therefore, must rule this issue as to all landowners other than Muschany and Andrews against the defendants.

In conclusion, therefore, the Court is of the opinion that the landowners are entitled to entry of judgments which shall include interest upon the deficiencies in their awards from the dates of the filing of the declarations of taking in these cases. The Court is duly appreciative of the position of the Government and the vigilance of its officers in protecting its rights. Great skill and diligence has been exercised by those agents, and the Court believes that their efforts were certainly not unreasonable in light of the contrary opinions arrived at by the various jurists to whom the issues have so far been presented. However, the Court feels that the landowners, within the spirit of the Fifth Amendment of the Constitution of the United States, are entitled to a just compensation for their lands, and that that includes the right to receive as additional compensation the interest granted by the Statute for their loss of the use of their land, or the use of their money, during the long period when the officers of the Government were attempting to diminish the amounts to be paid to them. As already stated, it appears to this Court that these landowners so clearly come within the class intended by Congress to be benefited by the Statute that, although the Government’s earnest attempts to obtain reversals were in the best of faith, the landowners should not be made to suffer because of those attempts.

Wherefore, the Court directs that in accordance with this opinion drafts of judgments carrying interest on the undeposited deficiencies from the filing of declarations of taking be presented in all of the above styled cases, except the Muschany and Andrews cases in which decrees have already been entered, and that, also, orders ruling the numerous motions and counter-motions be supplied. Upon submission for approval and settlement of the same appropriate orders and decrees will be entered.