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The Delaware/Opinion of the Court

"It is true that the bill of lading does not say in express terms that the goods shall be stowed under deck, but this is a condition tacitly annexed to the contract by operation of law; and it is equally binding on the master, and the shipper is equally entitled to its benefit, although it was stated in express terms. The parol evidence, then, is offered to control the legal operation of the bill of lading, and it is as inadmissible as though it were to contradict its words."

'In Garrison v. The Memphis Insurance Company, it was held that, where the bill of lading mentioned that the carrier was not to be responsible for injuries caused by the 'perils of the river.' parol evidence was inadmissible to show that by usage 'fire' was included among those perils.

'Where a promissory note mentions no time of payment, the law adjudges it to be due immediately, and parol evidence is not admissible to show a different time of payment agreed upon by the parties at the time it was executed.'

These and other cases were relied on by the court, and in addition to them Barber v. Brace, in the Supreme Court of Connecticut, was cited by counsel, to show that 'a parol agreement anterior to a written contract is inadmissible.'

The question, as the reader familiar with the decisions on the subject will see, is one upon which opinions not consistent with some of those thus above quoted have been given in certain courts. In this court the question had never been specifically passed upon. On that account and for the importance of the question, the argument against the view in the courts below, is presented with more than ordinary fulness.

Mr. E. Casserly, for the plaintiff in error:

I. The objection to the parol proof is put on a rule of evidence. What is the rule of evidence? Does it apply in this case?

1. The rule is exactly stated by our leading text writer, who holds it with all due strictness:

'Parol contemporaneous evidence is inadmissible to contradict or vary the terms of a valid written instrument.'

Mr. Starkie states the rule substantially the same way. And he adds, as 'a general rule,'

'Oral and extrinsic evidence is admissible to rebut a presumption of law or equity. Here it is not offered as a substitute for the written evidence, but to remove an impediment, which would otherwise have obstructed or altered its operation.'

The writer, who, more than any other, has discussed thoroughly the whole subject, states the rule explicitly:

'The true meaning of the rule is, that such evidence shall never be received to show that the intention of the parties was directly opposite to that which their language expresses, or substantially different from any meaning the words they have used upon any construction will admit or convey.'

Barrett v. Insurance Company, is almost in the same language as that last above quoted.

In Parks v. ''Gen. Int. Co.'', it is held that a condition or implied undertaking, not expressed in the terms of the policy, may be superseded by a previous verbal or written statement.

In Susquehanna Company v. Evans, Judge Washington states the rule to be:

'The reasons which forbid the admission of parol evidence to alter or explain written agreements do not apply to those contracts implied by operation of law.'

In Brent's Executors v. Bank, parol proof was admitted of an agreement that payment of a promissory note should be demanded at a particular bank, and not personally of the maker; the note being silent on the subject. Marshall, C.J., say:

'This is not an attempt to vary a written instrument. The place of demand is not expressed on the face of the note, and the necessity of a demand on the person when the parties are silent is a mere inference of law, which is drawn only when they are silent. A parol agreement puts an end to this inference. . . . This does not alter the instrument, so far as it goes, but supplies extrinsic circumstances which the parties are at liberty to supply.'

2. Does the rule apply to this case? How did the proposed parol evidence 'contradict or vary the terms of the written instrument'-in this case, the bill of lading? By its 'terms' the bill makes no provision whatever for stowage of the iron shipped, still less for stowage of it in any particular place. Clearly, then, parol proof of an agreement for a deck stowage cannot be said to 'contradict or vary the terms' of the bill. Suppose we read the bill as though it contained the agreement which we offered to prove-'said iron to be carried on deck.' In what respect does this provision 'contradict or vary the terms of the written contract?' Since it does not, but is obviously in accord with them, how can parol proof of it be said to do so?3 As the bill, by its 'terms,' provides nothing as to the place of stowage, and as the law allows the parties to make what contracts they choose as to that particular subject, and in what manner they choose, by writing or by words, it is incorrect to say that parol proof of a contract, or consent by the shipper to stow on deck, is within any rule against parol proof, either as 'contradicting or varying' 'the terms' of the writing, or as substituting parol when the law demands a writing.

II. This argument cannot be answered. It is, therefore, sought to be eluded. It is said that though by its terms the common or clean bill of lading is silent as to the stowage, yet that it 'imports that the goods are to be safely stowed under deck;' that this is 'a condition tacitly annexed to the contract by operation of law;' and that this implied contract is so conclusive, that the law will not admit parol evidence to show that the parties contracted for a stowage on deck.

1. Is it in any sense correct to say, that the common bill of lading 'imports a stowage safely under deck,' or that such is 'the condition tacitly annexed to the contract by operation of law?' We think not. On the contrary, we submit that what the instrument 'imports' or 'implies' is not a stowage either in any particular place, or in any particular manner; but simply a stowage as to placed and manner, such as is authorized by the custom or usage of trade, whether in respect to the particular goods in the bill of lading, or to the particular voyage which the ship is to make.

2. The law of common carriers of goods had its rise in 'the custom of the realm.' In suit against a carrier, the ancient practice was to set out and prove the general custom, until the custom became in time so well settled, that the courts took judicial notice of it, which is itself a substitute for proof, if not a mode of proof, and is at times the result of actual inquiry into proofs. The same law to-day rests mainly in the custom of trade; perhaps, in all respects, except where either some rule or policy of the law, or some valid agreement between the parties, forbids. In the absence of such rule, policy, or agreement, a common carrier is obliged only to carry such goods, in such parcels, and with such stowage, in such conveyance, by such route, at such charges, with such dispatch, and such delivery, as are customary in his line of business. And, in practice, almost universally the law and the parties wisely agreed in leaving to the custom all these important subjects, except perhaps the charges.

3. Like the other two great instruments of commerce-the charter-party and the policy of marine insurance-the bill of lading in its 'terms' is not a complete contract. It is a brief writing in which only the heads of the contract are expressed; the receipt of the goods on board; the places whence and where they are to be carried; the person to whom they are to be delivered in like good order, &c.; and at what freight. In a bill of lading as in the others-and, indeed, even more so-the parties are silent as to the mode and manner in which the heads of the contract are to be performed. These they leave to the custom of the trade. It is a presumption of law that they have made their contract as to the mode and manner, on this basis.

4. This is more true of the subject of stowage than it is perhaps of any other matter under the bill of lading.

Let us refer first to some of the other instances.

a. The express contract, to carry to the place of destination, means, by construction of law, with all reasonable dispatch. Yet, it is held that this contract is controlled by proof of a custom on the Ohio, to allow boats a delay of a month or more, while waiting the rise of water.

b. So, upon the question, as to when the carrier's responsibility for the goods terminates. The express contract of the bill of lading to deliver to A. is controlled by the usage.

c. The whole question of delivery, time, place, is a question of the custom of business. As where the point was as to the duty of the ferryman to carry goods up a slip.

d. The express contract in the bill of lading here is for a voyage from Portland to San Francisco. This calls for a direct voyage, without deviation; yet it may be controlled by proof of a usage to make the deviation complained of, of the shipper's knowledge of the intent to make it.

5. The power of usage over the subject of stowage as to which the common bill of lading is silent, is still greater. Indeed stowage is completely the creature of usage. Hence it is, doubtless, that the common bill of lading is silent as to it. Under such a bill, whatever usage authorizes, as to either the place or manner of stowage, whether as respects the particular goods to be carried, or other goods in the same ship, or the particular voyage or class of ships in which they are to be carried, may lawfully be done by the carrier. It may be done, though some other place or manner of stowage might be safer for the particular goods themselves or for other goods in the same vessel.

Not only does usage control, but what is the usage varies with the circumstances. In one class of cases the usage turns upon the nature of the goods to be carried; in another class upon the nature of the voyage on which they are to be carried.

a. Thus, in all trades, where the nature of the goods is such that they are dangerous to the ship or cargo-as corrosive or inflammable oils and other liquids-the usage is, that they may be carried on deck, where in case of accident they can do the least harm and may be most readily cast overboard.

b. In like manner live stock are carried on deck, for the sake of their health, and perhaps of convenience of handling them.

c. A usage to carry lumber on deck, between Quebec and London, was sustained on demurrer in Gould v. Oliver.

d. The usage to carry deck loads is more favored in the case of a steamer plying coastwise than in that of a sailing vessel.

e. And it is affected by the peculiar build of the vessel, as in the case of propellers with two decks on our great lakes.

f. In this court the doctrine is established, that what goods shall be carried in the same ship, and how and where they shall be stowed in reference to each other, is controlled by usage, rather than by the greater or less safety of the goods. The principle of this doctrine is conclusive in our favor.

6. Hence, it is not correct to say that a clean bill 'imports that the goods are to be stowed safely under deck;' or that it is the 'condition tacitly annexed to the contract by operation of law;' or 'a rule of law'-that they shall be so stowed. These phrases, which all come to the same thing, are but half truths. They state the effect, not the cause. If they are correct at all, it is because the usage calls for such a stowage under deck. The 'import,' or the 'tacit condition,' or 'the rule of law' comes back after all to the usage.

Either this is the true view, or else you cannot give any well-founded reason why under the same form of words, in the 'clean' bill of lading, the carrier's liability differs so greatly, so that in one case he is liable if he carries on deck; in another he is not; while in a third case he is liable unless he does carry on deck.

On this point of the presumption more will be said presently.

The following proposition, then, which is the sum of the preceding authorities, we submit as the true statement of the law:

FIRST POINT. ''The common bill of lading, such as that in this case, being silent on the subject of stowage, neither imports nor implies any particular place of stowage of goods. What it imports or implies is simply such a place of stowage as is according to the usage of the trade in regard to such goods on such a voyage''.

SECOND POINT. The reason of this rule is, that there being a usage of the trade, that on such a voyage, such goods shall be stowed under deck, it is a presumption of law, in the absence of express words to the contrary, that the parties have contracted for a place of stowage according to the usage.

1. That the effect of a 'clean' bill of lading is simply to raise such a presumption is clear upon principle and on authority.

In trade or commerce the general usage is constantly admitted to expound the contracts of parties, as well where the contract is silent as where the language in which it speaks has by usage a technical meaning. This is because of the presumption arising upon the general usage, that the parties have intended to contract in accordance with the usage.

As applied to stowage. In Vernard v. Hudson, it is held that the presumption that goods shipped under the common bill of lading are to be put under deck, is a presumption arising from the ordinary course of business.

'The bill of lading is what is called a clean bill; that is, it is silent as to the mode of stowing the goods. . . . The usual and only safe mode of carrying goods is under deck; and, when the contract is entered into, it is presumed to be the intention of the parties that the goods shall be stowed and carried in the usual way, unless there is an agreement to the contrary.'

To the same effect is The Paragon, The Rebecca, The Peytona.

THIRD POINT. The presumption of law that under such a bill of lading the parties have contracted on the basis of the usage, and for a stowage under deck in accordance with the usage, is but a prim a facie presumption, and may be rebutted by parol proof of an agreement for a stowage on deck.

1. The presumption mentioned is one arising upon an extrinsic fact; i. e., upon the usage of trade. Whether the usage is such as to require extrinsic proof, or is so general-as in this case-as to dispense with such proof and to rest in judicial notice, is not material. In either case the presumption may be rebutted by parol proof.

2. In close connection with the rule, as to the presumption arising upon the usage of trade, is found this other rule, that 'oral and extrinsic evidence is admissible to rebut a presumption of law or equity.' Mr. Duer justly relies on this rule in support of his views in favor of the admission of parol evidence to rebut a presumption arising upon a usage.

Lord Mansfield, speaking of rebutting by parol evidence a presumption of law, in Brady v. Cubitt, declared: 'I am clear that this presumption, like all others, may be rebutted by every sort of evidence.'

3. In Vernard v. Hudson, already quoted supra, 588, the distinct question arose and was decided. The libel was for freight due on a common bill of lading for goods shipped. The defence was that they were stowed on deck and damage thereby caused. The ship offered parol proof of a contract for stowage on deck, and one question was, whether such proof was admissible within the rule against parol evidence. Judge Story says (406, 407):

'I take it to be very clear, that where goods are shipped under the common bill of lading, it is presumed that they are shipped to be put under deck, as the ordinary mode of stowing cargo. This presumption may be rebutted by showing a positive agreement between the parties that the goods are to be carried on deck; or it may be deduced from other circumstances, such, for example, as the goods paying the deck freight only. The admission of proof to this effect is perfectly consistent with the rules of law; for it neither contradicts nor varies anything contained in the bill of lading, but it simply rebuts a presumption arising from the ordinary course of business. The onus probandi is, therefore, on the libellant to establish such an agreement.'

In Sayward v. Stevens, the bill of lading provided for a deck stowage of part of the plaintiff's goods. Other goods of his were, however, stowed on deck. The whole deck load was jettisoned on the voyage. The court says it was obliged—

'To determine whether the contract rests solely in the bill of lading or whether it can be varied or explained by parol proof of the acts and conduct of the parties,' &c.

The effect of a clean bill of lading is discussed, and though the court has 'no occasion to determine' whether or not the obligation under such a bill to stow under deck 'is a mere presumption, arising from the usual mode of conveying merchandise in vessels and liable to be rebutted by proof of a parol contract,' &c., it intimates a strong opinion on the rule of evidence. It says:

'As bills of lading do not usually contain any express stipulation concerning the place or mode of stowing the cargo these being left to the care and discretion of the master of a vessel-the admission of such evidence would not seem to be a violation of the salutary rule, that written contracts cannot be varied or controlled by parol proof.'

The decision, which was unanimous, was by Shaw, Dewey, and Metcalf, JJ.

This case well illustrates when parol proof varies or contradicts the terms of the bill of lading and is therefore inadmissible. The express provision for a deck stowage of a part of the goods excluded parol proof of a consent to such a stowage of any other part.

To this effect, merely, is Garrison v. Memphis Insurance Co., cited against us by the District judge, though there the parol proof was admitted put held insufficient.

4. By the express contract in the common bill of lading, for a voyage from A. to B., the presumption is of an agreement for a direct voyage. This is a very important presumption, at least as much so to the interests of commerce as the presumption of a stowage under deck. But, being like that, a presumption arising out of the usage of business, it may be rebutted by parol proof of the shipper's personal knowledge that the master intended to deviate. The point was made against the proof; but it was not sustained. The court says:

'There is nothing in the evidence contradicting the express terms of the bill of lading,' &c.

In the Mary Hawes, decided by Lowell, J., in the District Court for Massachusetts, it was held, that proof of a usage to make the deviation, or of the shipper's knowledge of the intent to make it, was admissible.

5. By agreement the merchant may have charge of the stowage of his own goods. This is not unusual where the goods require special care in the handling and stowage. If the merchant should sue the ship for the loss of his goods stowed by himself on deck, as in a deck-house, is it possible that the form of a clean bill of lading would suffice to shut out the parol proof that the stowage was by the merchant himself?

6. So, the rule is that under the common bill of lading the title to the goods is in the consignee. This, too, is a presumption arising out of the usual course of business, and may be rebutted by parol proof. On the same principle the warranty of title implied in a sale of chattels in the vendor's possession may be rebutted by parol, whether the contract of sale is oral or written.

7. The rule that parol proof is admitted to rebut presumptions arising from the usage or ordinary course of business, where the written contract is silent, prevails in analogous cases in the law of marine insurance, under the policy, and for the same reasons as under the bill of lading.

a. Take the case of deviation. From the fact of insurance, it is presumed that the parties agreed for an adventure, to be pursued in the usual manner; in other words, for a direct voyage, without voluntarily changing the risks. This, too, being a presumption arising upon the usage of trade, may be rebutted by parol proof of representations.

b. Take from the same law of insurance, a still stronger illustration. It is now settled law in this country that even the warranty implied in every marine policy, that the vessel insured is seaworthy, as the fundamental fact of the contract, may be superseded by parol proof of previous verbal 'representations' of the assured party. The principle of the rule is, says Mr. Duer, that the warranty of seaworthiness is not implied from any terms of the policy, but rests on the presumption that the seaworthiness of the vessel is understood by the parties to be the basis of their contract. Adopting this view of his, it is clear enough that, when this presumption is repelled, by parol proof of representations to the contrary, such representations become a part of the contract, as they do by the American law, and completely displace the presumption of a warranty.

8. Now, since in regard to the policy and the charter-party, parol proof is admitted to rebut by extrinsic facts, the presumption arising upon the usual course of business-or the 'inference of law,' in the words of C. J. Marshall-with respect to matters of which the writing is silent, why should not the same rule of evidence apply to the bill of lading? Since these three great instruments work together in one design for the interests of commerce, to speed or to guard them on every sea, why should they not rest before the law upon the same or similar general principles for their interpretation?

IV. In some of the most noted cases in respect to goods carried on deck under a clean bill of lading, parol proof of the merchant's agreement that his goods might be so carried, or of circumstances from which it might be inferred, was admitted without objection from eminent counsel. A few will be cited.

In Lawrence v. Minturn, in this court, there was a written memorandum for a deck stowage, but it was of course merged in the bill of lading executed a month afterwards.

In Gould v. Oliver, the suit was on a charter-party, for lumber stowed on deck, and jettisoned during the voyage. The defendant sought to show by parol, a consent, by knowledge and approval of the plaintiffs' superintendent, to the stowage. No objection was made by the counsel for the plaintiffs, Sir Thomas Wilde and Mr. (now Baron) Wightman. The proof held insufficient only for want of authority in the superintendent.

In The Rebecca, already cited, parol proof of consent to stow on deck, under common bill of lading, received and considered by the court.

And The Waldo is to the like effect.

In Sproat v. Donnell, proof was admitted that the merchant knew of the deck stowage, and made no objection.

V. As to the cases cited against the admissibility of the parol proof, it must suffice to notice those bearing with some directness on the point.

Creery v. Holly was not a suit between the parties to a bill of lading. It was a suit by vendor against vendee for the value of a quantity of iron shipped from New York to Baltimore by the former to the latter, upon orders from him. Though there was a clean bill of lading, the iron was stowed on deck, and in stress of weather cast overboard. The defendant offered to show that the plaintiff (the vendor) had agreed orally that the goods might be shipped on deck. This was objected to, as being within the rule against parol evidence, but admitted. For aught that appears, the defendant was neither a party nor privy to the bill of lading, and his parol evidence was admissible to show what amounted to non-delivery of the goods sold through the fault of the vendor. The case is one of doubtful impression.

Barber v. Brace is still more unsatisfactory as an authority. Parol proof of an agreement to stow the goods on deck, when first offered on the trial below, was excluded. It was afterwards admitted, to contradict the plaintiff's witnesses, and was limited to that by the judge, who, however, charged the jury to find for the defendant (the carrier), if there was an agreement to stow on deck. A verdict for the defendant was sustained.

The Waldo was a case of deck stowage, under the common bill of lading, and of an attempt to prove by parol an agreement for such a stowage. The decision is in terms against the admission of the parol proof. Yet the eminent judge, as if not wholly satisfied with his decision excluding the parol proof, goes fully into it in another aspect of the case, and holds it insufficient to prove the agreement so to stow.

White v. Van Kirk was the case of a bill of lading for a voyage from Albany to Baltimore. The question was which of two routes-an inside or an outside route-neither of which was specified, should have been taken. The master took the outside route and lost the goods. The merchant offered parol proof of an agreement with the master for the inside or safer route. It was rejected by the court, which at the same time, however, as if not quite sure of its law, held the agreement not proved. As an authority, this case is worse than doubtful.

The same general criticism applies to Niles v. Culver. The writing there was the carrier's receipt for '245 barrels of apples, to forward to New York, at 44 cents per barrel; advanced $10, and cartage $4.81.' The court held this to be not a receipt, but a contract, incapable of being varied by parol proof, &c. It doubts a case which holds that the admission in the bill of lading that the goods shipped are in good order is not conclusive. It excluded all parol evidence of an agreement as to many matters on which the receipt was silent, the time of forwarding, the particular, boat, and that there was to be no transshipment.

Most of the other cases cited against us are cases on promissory notes. Of these it suffices to say that the peculiar negotiable character of such instruments makes them so unlike the common bill of lading as to deprive such cases of much application here.

Mr. C. E. Whitehead (a brief of Mr. J. E. Ward being filed), contra.

Mr. Justice CLIFFORD delivered the opinion of the court.

Ship-owners, as carriers of merchandise, contract for the safe custody, due transport and right delivery of the goods; and the shipper, consignee, or owner of the cargo contracts to pay the freight and charges; and by the maritime law, as expounded by the decisions of this court, the obligations of the ship-owner and the shipper are reciprocal, and it is equally well settled that the maritime law creates reciprocal liens for the enforcement of those obligations, unless the lien is waived by some express stipulation, or is displaced by some inconsistent and irreconcilable provision in the charter-party or bill of lading. Shippers should in all cases require a bill of lading, which is to be signed by the master, whether the contract of affreightment is by charter-party or without any such customary written instrument. Where the goods of a consignment are not all sent on board at the same time, it is usual for the master, mate, or other person in charge of the deck, and acting for the carrier, to give a receipt for the parcels as they are received, and when the whole consignment is delivered, the master, upon those receipts being given up, will sign two or three, or, if requested, even four bills of lading in the usual form, one being for the ship and the others for the shipper. More than one is required by the shipper, as he usually sends one by mail to the consignee or vendee, and if four are signed he sends one to his agent or factor, and he should always retain one for his own use. Such an instrument acknowledges the bailment of the goods, and is evidence of a contract for the safe custody, due transport, and right delivery of the same, upon the terms, as to freight, therein described, the extent of the obligation being specified in the instrument. Where no exceptions are made in the bill of lading, and in the absence of any legislative provisions prescribing a different rule, the carrier is bound to keep and transport the goods safely, and to make right delivery of the same at the port of destination, unless he can prove that the loss happened from the act of God or the public enemy, or by the act of the shipper or owner of the goods. Stipulations in the nature of exceptions may be made limiting the extent of the obligation of the carrier, and in that event the bill of lading is evidence of the ordinary contract of affreightment, subject, of course, to the exceptions specified in the instrument; and in view of that fact the better description of the obligation of such a carrier is that, in the absence of any Congressional legislation upon the subject, he is in the nature of an insurer, and liable in all events and for every loss or damage, however occasioned, unless it happened by the act of God or the public enemy, or by some other cause or accident, without any fault or negligence on the part of the carrier, and expressly excepted in the bill of lading.

Seventy-five tons of pig-iron were shipped by the libellants, on the eighth of May, 1868, on board the bark Delaware, then lying in the port of Portland, Oregon, to be transported from that port to the port of San Francisco, for the freight of four dollars and fifty cents per ton, to be delivered to the shippers or their assigns at the port of destination, they paying freight as therein stipulated, before delivery if required, with five per cent. primage and average accustomed. Dangers of the seas, fire, and collision were excepted in the bill of lading, and the statement at the close of the instrument was, 'vessel not accountable for breakage, eakage, or rust.'

Process was served and the claimant appeared and filed an answer, in which he admits the shipment of the iron and the execution of the bill of lading exhibited in the record. Sufficient also appears in the record to show that the voyage was performed and that but a small portion of the iron shipped, to wit, some thirteen or fourteen thousand pounds, was ever delivered to the consignees, and that all the residue of the shipment was thrown overboard as a jettison during the voyage, which became necessary by a peril of the sea, for the safety of the other associated interests and for the preservation of the lives of those on board. Sacrificed as all that portion of the shipment was as a jettison in consequence of a peril of the sea, excepted in the bill of lading, the claimant insists that the libellants have no claim against the ship, and that the libellants as the shippers of the iron must bear their own loss.

Evidence was exhibited by the claimant sufficient to show that the allegations of the answer that the iron, not delivered, was sacrificed during the voyage as a jettison in consequence of a peril of the sea are true, but the libellants allege that the iron was improperly stowed upon the deck of the vessel, and that the necessity of sacrificing it as a jettison arose solely from that fact, and that no such necessity would have arisen if it had been properly stowed under deck, as it should have been by the terms of the contract specified in the bill of lading. That the iron not delivered was stowed on deck is admitted, and it is also conceded that where goods are stowed in that way without the consent of the shipper the carrier is liable in all events if the goods are not delivered, unless he can show that the goods were of that description, which, by the usage of the particular trade, are properly stowed in that way, or that the delivery was prevented by the act of God or the public enemy, or by some other cause or accident, without any fault or negligence on the part of the carrier and expressly excepted in the bill of lading.

Goods, though lost by perils of the sea, if they were stowed on deck without the consent of the shipper, are not regarded as goods lost by the act of God within the meaning of the maritime law, nor are such losses regarded as losses by perils of the sea which will excuse the carrier from delivering the goods shipped to the consignee unless it appears that the manner in which the goods were stowed is sanctioned by commercial usage, or unless it affirmatively appears that the manner of stowage did not, in any degree, contribute to the disaster; that the loss happened without any fault or negligence on the part of the carrier, and that it could not have been prevented by human skill and prudence, even if the goods had been stowed under deck, as required by the general rules of the maritime law.

Enough appears in the record to show that all the iron not delivered to the consignees was stowed on deck, and there is no proof in the case to show that the usage of the trade sanctioned such a stowage in this case, or that the manner in which it was stowed did not contribute both to the disaster and to the loss of the goods.

None of these principles are controverted by the claimant, but he insists that the iron not delivered was stowed on deck by the consent of the shippers and in pursuance of an oral agreement between the carrier and the shippers consumated before the iron was sent on board, and before the bill of lading was executed by the master. Pursuant to that theory testimony was offered in the District Court showing that certain conversations took place between the consignee of the bark and the agent of the shippers tending to prove that the shippers consented that the iron in question should be stowed on the deck of the vessel. Whether any express exception to the admissibility of the evidence was taken or not does not distinctly appear, but it does appear that the question whether the evidence was or not admissible was the principal question examined by the District Court, and the one upon which the decision in the case chiefly turned. Apparently it was also the main point examined in the Circuit Court, and it is certain that it has been treated by both sides in this court as the principal issue involved in the record, and in view of all the circumstances the court here decides that it must be considered that the question as to the admissibility of the evidence is now open for revision, as the decree for the libellant was equivalent to a ruling rejecting the evidence offered in defence or to a ruling granting a motion to strike it out after it had been admitted, which is a course often pursued by courts in cases where the question deserves examination. What the claimant offered to prove was that the iron was stowed on deck with the consent of the shippers, but the libellants objected to the evidence as repugnant to the contract set forth in the bill of lading, and the decree was for the libellants, which was equivalent to a decision that the evidence offered was incompetent. Dissatisfied with that decree the respondent appealed to the Circuit Court, where the decree of the District Court was affirmed, and the same party appealed from that decree and removed the cause into this court for re-examination.

Even without any further explanation it is obvious that the only question of any importance in the case is whether the evidence offered to show that the iron in question was stowed on deck with the consent of the shippers was or was not properly rejected, as it is clear if it was, that the decree must be affirmed; and it is equally clear, if it should have been admitted, that the decree must be reversed.

Different definitions of the commercial instrument, called the bill of lading, have been given by different courts and jurists, but the correct one appears to be that it is a written acknowledgment, signed by the master, that he has received the goods therein described from the shipper, to be transported on the terms therein expressed, to the described place of destination, and there to be delivered to the consignee or parties therein designated. Regularly the goods ought to be on board before the bill of lading is signed, but if the bill of lading, through inadvertence or otherwise, is signed before the goods are actually shipped, as if they are received on the wharf or sent to the warehouse of the carrier, or are delivered into the custody of the master or other agent of the owner or charterer of the vessel and are afterwards placed on board, as and for the goods embraced in the bill of lading, it is clear that the bill of lading will operate on those goods as between the shipper and the carrier by way of relation and estoppel, and that the rights and obligations of all concerned are the same as if the goods had been actually shipped before the bill of lading had been signed. Such an instrument is twofold in its character; that is, it is a receipt as to the quantity and description of the goods shipped, and a contract to transport and deliver the goods to the consignee or other person therein designated, and upon the terms specified in the same instrument. Beyond all doubt a bill of lading, in the usual form, is a receipt for the quantity of goods shipped and a promise to transport and deliver the same as therein stipulated. Receipts may be either a mere acknowledgment of payment or delivery, or they may also contain a contract to do something in relation to the thing delivered. In the former case, and so far as the receipt goes only to acknowledge payment or delivery, it, the receipt, is merely prim a facie evidence of the fact, and not conclusive, and therefore the fact which it recites may be contradicted by oral testimony, but in so far as it is evidence of a contract between the parties it stands on the footing of all other contracts in writing, and cannot be contradicted or varied by parol evidence. Text writers mention the bill of lading as an example of an instrument which partakes of a twofold character, and such commentators agree that the instrument may, as between the carrier and the shipper, be contradicted and explained in its recital that the goods were in good order and well conditioned, by showing that their internal state and condition was bad or not such as is represented in the instrument, and in like manner, in respect to any other fact which it erroneously recites, but in all other respects it is to be treated like other written contracts.

Bills of lading when signed by the master, duly executed in the usual course of business, bind the owners of the vessel if the goods were laden on board or were actually delivered into the custody of the master, but it is well-settled law that the owners are not liable, if the party to whom the bill of lading was given had no goods, or the goods described in the bill of lading were never put on board or delivered into the custody of the carrier or his agent. Proof of fraud is certainly a good defence to an action claiming damages for the non-delivery of the goods, but it is settled law in this court that a clean bill of lading imports that the goods are to be safely and properly stowed under deck, and that it is the duty of the master to see that the cargo is so stowed and arranged that the different goods may not be injured by each other or by the motion or leakage of the vessel, unless by agreement that service is to be performed by the shipper. Express contracts may be made in writing which will define the obligations and duties of the parties, but where those obligations and duties are evidenced by a clean bill of lading, that is, if the bill of lading is silent as to the mode of stowing the goods, and it contains no exceptions as to the liability of the master, except the usual one of the dangers of the sea, the law provides that the goods are to be carried under deck, unless it be shown that the usage of the particular trade takes the case out of the general rule applied in such controversies. Evidence of usage is admissible in mercantile contracts to prove that the words in which the contract is expressed, in the particular trade to which the contract refers, are used in a particular sense and different from the sense which they ordinarily import; and it is also admissible in certain cases, for the purpose of annexing incidents to the contract in matters upon which the contract is silent, but it is never admitted to make a contract or to add a new element to the terms of a contract previously made by the parties. Such evidence may be introduced to explain what is ambiguous, but it is never admissible to vary or contradict what is plain. Evidence of the kind may be admitted for the purpose of defining what is uncertain, but it is never properly admitted to alter a general rule of law, nor to make the legal rights or liabilities of the parties other or different from what they are by the common law. Cases may arise where such evidence may be admissible and material, but as none such was offered in this case it is not necessary to pursue that inquiry. Exceptions also exist to the rule that parol evidence is not admissible to vary or contradict the terms of a written instrument where it appears that the instrument was not within the statute of frauds nor under seal, as where the evidence offered tends to prove a subsequent agreement upon a new consideration. Subsequent oral agreements in respect to a prior written agreement, not falling within the statute of frauds, may have the effect to enlarge the time of performance, or may vary any other of its terms, or, if founded upon a new consideration, may waive and discharge it altogether. Verbal agreements, however, between the parties to a written contract, made before or at the time of the execution of the contract, are in general inadmissible to contradict or vary its terms or to affect its construction, as all such verbal agreements are considered as merged in the written contract.

Apply that rule to the case before the court and it is clear that the ruling of the court below was correct, as all the evidence offered consisted of conversations between the shippers and the master before or at the time the bill of lading was executed. Unless the bill of lading contains a special stipulation to that effect the master is not authorized to stow the goods sent on board as cargo on deck, as when he signs the bill of lading, if in common form, he contracts to convey the merchandise safely, in the usual mode of conveyance, which, in the absence of proof of a contrary usage in the particular trade, requires that the goods shall be safely stowed under deck; and when the master departs from that rule and stows them on deck, he cannot exempt either himself or the vessel from liability, in case of loss, by virtue of the exception, of dangers of the seas, unless the dangers were such as would have occasioned the loss even if the goods had been stowed as required by the contract of affreightment. Contracts of the master, within the scope of his authority as such, bind the vessel and give the creditor a lien upon it for his security, except for repairs and supplies purchased in the home port, and the master is responsible for the safe stowage of the cargo under deck, and if he fails to fulfil that duty he is responsible for the safety of the goods, and if they are sacrificed for the common safety the goods stowed under deck do not contribute to the loss. Ship-owners in a contract by a bill of lading for the transportation of merchandise take upon themselves the responsibilities of common carriers, and the master, as the agent of such owners, is bound to have the cargo safely secured under deck, unless he is authorized to carry the goods on deck by the usage of the particular trade or by the consent of the shipper, and if he would rely upon the latter he must take care to require that the consent shall be expressed in a form to be available as evidence under the general rules of law.

Where goods are stowed under deck the carrier is bound to prove the casualty or vis major which occasioned the loss or deterioration of the property which he undertook to transport and deliver in good condition to the consignee, and if he fails to do so the shipper or consignee, as a general rule, is entitled to his remedy for the non-delivery of the goods. No such consequences, however, follow if the goods were stowed on deck by the consent of the shipper, as in that event neither the master nor the owner is liable for any damage done to the goods by the perils of the sea or from the necessary exposure of the property, but the burden to prove such consent is upon the carrier, and he must take care that he has competent evidence to prove the fact. Parol evidence, said Mr. Justice Nelson, in the case of Creery v. Holly, is inadmissible to vary the terms or legal import of a bill of lading free of ambiguity, and it was accordingly held in that case that a clean bill of lading imports that the goods are stowed under deck, and that parol evidence that the vendor agreed that the goods should be stowed on deck could not legally be received even in an action by the vendor against the purchaser for the price of the goods which were lost in consequence of the stowage of the goods in that manner by the carrier. Even where it appeared that the shipper, or his agent who delivered the goods to the carrier, repeatedly saw them as they were stowed in that way and made no objection to their being so stowed, the Supreme Court of Maine held that the evidence of those facts was not admissible to vary the legal import of the contract of shipment; that the bill of lading being what is called a clean bill of lading, it bound the owners of the vessel to carry the goods under deck, but the court admitted that where there is a well-known usage in reference to a particular trade to carry the goods as convenience may require, either upon or under deck, the bill of lading may import no more than that the cargo shall be carried in the usual manner. Testimony to prove a verbal agreement that the goods might be stowed on deck was offered by the defence in the case of Barber v. Brace, but the court rejected the testimony, holding that the whole conversation, both before and at the time the writing was given, was merged in the written instrument, which undoubtedly is the correct rule upon the subject. Written instruments cannot be contradicted or varied by evidence of oral conversations between the parties which took place before or at the time the written instrument was executed; but in the case of a bill of lading or a charter-party, evidence of usage in a particular trade is admissible to show that certain goods in that trade may be stowed on deck, as was distinctly decided in that case. But evidence of usage cannot be admitted to control or vary the positive stipulations of a bill of lading, or to substitute for the express terms of the instrument an implied agreement or usage that the carrier shall not be bound to keep, transport, and deliver the goods in good order and condition.

Remarks, it must be admitted, are found in the opinion of the court, in the case of Vernard v. Hudson, and also in the case of Sayward v. Stevens, which favor the views of the appellant, but the weight of authority and all the analogies of the rules of evidence support the conclusion of the court below, and the court here adopts that conclusion as the correct rule of law, subject to the qualifications herein expressed.

DECREE AFFIRMED.

title: The Delaware/Opinion of the Court


text: Talk:The Delaware/Opinion of the Court

license: Creative Commons - Attribution Share-Alike - https://creativecommons.org/licenses/by-sa/4.0/

title: Talk:The Delaware/Opinion of the Court


text:
Leary v. United States (81 U.S. 607)

APPEAL from the Court of Claims.

On the 19th of November, 1862, one Leary, owner of the steamer Mattano, chartered her to the United States, for the purpose of plying in the harbor of Port Royal, South Carolina, or for any other service the government might designate.

By the terms of the charter-party Leary engaged that the vessel during the existence of the charter, should be kept tight, stanch, well-fitted, tackled, and provided with every requisite, and with men and provisions necessary; that the whole of it (with the exception of room necessary for the accommodation of the crew and the storage of cables and provisions) should be at the sole use and disposal of the government during the existence of the charter; and that no goods or merchandise should be laden on board otherwise than from the government or its agent, on pain of forfeiture of the amount that may become due on the charter; that he, Leary, would receive on board the vessel, during the charter, all such goods and merchandise as the government might think proper to ship. The government on its part agreed to charter and hire the vessel at $250 a day, for each day that it might be retained under the charter, the government to supply the coal; and that in case the vessel, while executing the orders of the government, should be destroyed or damaged by a hostile force from any quarter, or by being compelled by the government, to run any extraordinary marine risk, then Leary was to be indemnified; in case of loss, the value of the vessel being fixed at $26,000, 'and in case of damage, the amount to be assessed by a board of survey, to be convened on her, after her arrival at Port Royal, South Carolina, or other friendly port, at the expense of the government.'

While under charter, the vessel was lying at one of the wharves in the harbor of Port Royal. On the 12th of May, 1863, the military harbor-master ordered her out to make room for another steamer. The captain of the Mattano objected to going out, as the tide was very low; and, as he believed, there was a considerable breeze from an unfavorable quarter. The harbor-master ordered the Marttano peremptorily to back out, and her captain let go his lines and did so. In thus backing out she struck upon the fluke of a sunken anchor imbedded in the sand, and sunk in fifteen minutes.

This anchor, against whose fluke the vessel struck, was a mooring anchor, and had been placed where it was by the United States quartermaster, to moor big ocean steamers prior to November, 1862, and had a buoy attached to it which showed its position; but, about the 1st of January, 1863, the buoy had gone adrift in a gale of wind, and had never been replaced, and there was nothing at the time of the accident to warn vessels of the position of the sunken anchor. No one could have pointed out where the anchor was at that time. The captain of the Mattano knew of the existence of the anchor, but thought he was a long way outside of it. There was no unskilfulness in executing the order to back out.

The Mattano was removed from where she sank by a wrecking-boat sent there by the Secretary of War, and under orders from the quartermaster, about July 4th, 1863, and the cost of this service was paid by the United States. A gale of wind, which came on after she sank, did damage to her by carrying off her upper works, wheel-house, and joiners' work clear to the hull. No board of survey was convened to assess the damage done to the vessel.

After the vessel had been raised by the United States Leary took possession of her, carried her to New York, and there had her put in order in such a way as to leave her fit for a towing or carrying vessel, but not fitted for passengers. These repairs were completed on the 10th of December, 1863, and cost Leary for her restoration $18,265.25; and she was worth then $12,000 less than before the accident. From the time this occurred, 12th of May, 1863, until the time the repairs were completed, December 10th, 1863, there were two hundred and fourteen days. The repairs were made as rapidly and as economically as possible. She was chartered again to the defendants in May, 1864, at $100 a day.

On this case the Court of Claims decided that the disaster was a usual marine disaster, such as was covered by ordinary marine policies of insurance, and not such extraordinary marine risk as was contemplated in the charter-party; and that if the owners neglected to protect themselves against such perils by insurance they would have to bear the loss. The court accordingly dismissed the petition, and hence the appeal to this court.

Messrs. Chipman, Hosmer, and Durant, for the appellants, argued in substance:

1st. That the United States were the owners of the injured vessel, by the terms of the charter-party, during the continuance of the service stipulated, and were consequently responsible for the damages sustained by the vessel whilst engaged in that service.

2d. That the damages to the vessel were occasioned by her running an extraordinary marine risk under compulsion from the United States, and for indemnity against such damages the charter-party stipulated, and they sought a reversal of the decree accordingly on those grounds.

Mr. G. H. Williams, Attorney-General, and Mr. C. H. Hill, Assistant Attorney-General, contra.

Mr. Justice FIELD delivered the opinion of the court.

title: Leary v. United States (81 U.S. 607)


text: Talk:Leary v. United States (81 U.S. 607)


text:
Leary v. United States (81 U.S. 607)/Opinion of the Court

There is no doubt that under some forms of a charter-party the charterer becomes the owner of the vessel chartered for the voyage or service stipulated, and consequently becomes subject to the duties and responsibilities of ownership. Whether in any particular case such result follows must depend upon the terms of the charter-party considered in connection with the nature of the service rendered. The question as to the character in which the charterer is to be treated is, in all cases, one of construction. If the charter-party let the entire vessel to the charterer with a transfer to him of its command and possession and consequent control over its navigation, he will generally be considered as owner for the voyage or service stipulated. But, on the other hand, if the charter-party let only the use of the vessel, the owner at the same time retaining its command and possession, and control over its navigation, the charterer is regarded as a mere contractor for a designated service, and the duties and responsibilities of the owner are not changed. In the first case the charter-party is a contract for the lease of the vessel; in the other it is a contract for a special service to be rendered by the owner of the vessel.

In examining the adjudged cases on this subject we find ome differences of opinion, especially in the earlier cases, as to the effect to be given to certain technical terms used in the charter-party in determining whether the instrument parts with the entire possession and control of the vessel, but no difference as to the rule of law applicable when the construction is settled. All the cases agree that entire command and possession of the vessel, and consequent control over its navigation, must be surrendered to the charterer before he can be held as special owner for the voyage or other service mentioned. The retention by the general owner of such command, possession, and control is incompatible with the existence at the same time of such special ownership in the charterer.

If, now, in the light of these observations we look at the charter-party in this case we shall find little difficulty in disposing of the first ground for reversal presented by the appellants. The vessel here was chartered for the purpose of plying in the harbor of Port Royal, in South Carolina, or for such other service as the government might designate, and the provisions which the charter-party contains on the part of the owners sound only in covenant. By it they engage that during the existence of the charter the vessel shall be kept tight, stanch, well fitted, tackled, and provided with every requisite, and with the necessary men and provisions; that the whole of the vessel, with the exception of the necessary room for the accommodation of the crew and the storage for the cables and provisions, shall be at the sole use and disposal of the government; that no goods or merchandise shall be laden on board otherwise than from the government, or with the assent of its agent, on pain of forfeiture of the amount that may become due on the charter; and that the owners will receive on board all lawful goods and merchandise which the government may think proper to ship. In consideration of these stipulations the United States agree that the owners shall receive the sum of two hundred and fifty dollars per day for each day the vessel is retained under the charter, and that they will supply the vessel with coal; and in case the vessel, whilst executing the orders of the government, shall be destroyed or damaged by a hostile force, or by being compelled to run any extraordinary marine risk, that the owners shall be indemnified.

The stipulations here designated on the part of the owners imply the possession and command of the vessel by them, and would be inconsistent with such possession and command by the government.

Stipulations that the general owners shall keep the vessel in good condition during the existence of the charter and receive on board certain goods at the request of the government and refuse to receive other goods without its assent, would be out of place and inappropriate if the government were, at the same time, special owners of the vessel for the service stipulated, having the vessel in its entire possession and control. Great weight was given to similar clauses by the King's Bench, in Saville v. Campion, and by the Supreme Court of New York, in Clarkson v. Edes. In each of these cases they were held conclusive that the possession and control of the vessel had not passed to the charter, but had been retained by the general owner.

The fact that the service stipulated in the present case was to be rendered for the government cannot alter the natural import of the terms used in the charter-party, or change its construction, although in a doubtful case that fact might be entitled to much consideration.

2. The second ground presented by the appellants for a reversal of the decree is readily answered. The risk that the vessel incurred in complying with the orders of the harbor-master was not an extraordinary marine risk within the meaning of the charter-party. The term extraordinary is there used to distinguish an unusual risk which the vessel might be compelled to run by order of the government, from those risks which would be covered by an ordinary marine policy and which might be expected to arise from the service in which the vessel was engaged. The contract of the government was not intended to apply to the usual risks attendant upon the performance of a service such as was here mentioned, but risks outside and beyond them.

The risk incurred was of a possible collision with a sunken anchor in the harbor. This was an ordinary risk which every vessel must run that enters a harbor, and is one which every marine policy covers.

DECREE AFFIRMED.


text: Talk:Leary v. United States (81 U.S. 607)/Opinion of the Court


text:
Erskine Collector v. Hohnbach

ERROR to the Circuit Court for the Eastern District of Wisconsin; the case being thus:

The 19th section of the act of July 13th, 1886, enacts:

'That no suit shall be maintained in any court for the recovery of any tax alleged to have been erroneously or illegally assessed or collected, until appeal shall have been duly made to the Commissioner of Internal Revenue, according to the provisions of law in that regard, and the regulations of the Secretary of the Treasury established in pursuance thereof, and a decision of said commissioner be had thereon.'

With this statutory provision in force, Hohnbach sued Erskine, a collector of internal revenue, in an action of trespass for the seizure by him, the said collector, and conversion to his use of certain personal property of the alleged value of $10,000, belonging to him, the plaintiff.

The declaration was in the usual form in such cases, and alleged that the seizure and conversion were made in May, 1869, at Milwaukee, in the State of Wisconsin. To this the defendant pleaded the general issue, and two special pleas, in which he justified the acts complained of on the ground that they were done by him as collector of internal revenue of the first collection district of Wisconsin, in the enforcement of an assessment chargeable against the plaintiff, duly made by the assessor of the district, and certified to him, with an order directing its collection. Both pleas set up the same defence of justification as collector of internal revenue, differing only in the particularity with which the facts of assessment and distraint and sale of the property were detailed.

To the first special plea the plaintiff replied de injuri a su a propri a absque tali caus a-that the defendant committed the several trespasses mentioned in the declaration of his own wrong, and without the cause alleged by him; and upon this replication issue was joined.

To the second special plea the plaintiff replied that the tax assessed, which was upon tobacco sold and materials used in its manufacture, was never chargeable to him, inasmuch as he did not manufacture and sell, or remove, within the period mentioned in the assessment, the tobacco described, or any part thereof, and that he had paid all the taxes chargeable against him upon the tobacco manufactured by him, and sold or removed for consumption or use during that period. To this replication the defendant rejoined that the plaintiff had not paid the sum assessed against him, as stated in the plea, for the tobacco thus manufactured by him and sold or removed for consumption. The conclusion was to the country, and the plaintiff joined in the issue.

On the trial which followed the jury found the several issues in favor of the plaintiff, and assessed his damages accordingly.

The defendant then moved in arrest of judgment on several grounds. They amounted, however, substantially to this: that the second special plea set forth a good defence to the action, inasmuch as it showed that the seizure and conversion complained of were made by the defendant as collector of internal revenue in the enforcement of a tax regularly and legally assessed against the plaintiff; and that the replication did not answer this plea because it did not allege that the plaintiff had taken an appeal from the assessment to the Commissioner of Internal Revenue, without which the action was not maintainable. The motion was denied, and judgment was entered upon the verdict for the plaintiff. To review this judgment the defendant brought the case here on writ of error.

Mr. C. H. Hill, Assistant Attorney-General, for the plaintiff in error; Messrs. Smith and Stark, contra.

Mr. Justice FIELD delivered the opinion of the court.

title: Erskine Collector v. Hohnbach


text: Talk:Erskine Collector v. Hohnbach

title: Talk:Erskine Collector v. Hohnbach


text:
Erskine Collector v. Hohnbach/Opinion of the Court

We do not think that the omission, in the replication, to allege that the plaintiff had taken an appeal from the assessment to the Commissioner of Internal Revenue affected the character of the replication, or that the insertion of the allegation would have aided it. The defect of the replication consisted in the fact that it raised an immaterial issue. An appeal to the Commissioner of Internal Revenue from an assessment is only a condition precedent to an action for the recovery of taxes paid. It is not a condition precedent to any other action where such action is permissible.

The collector could not revise nor refuse to enforce the assessment regularly made by the assessor in the exercise of the latter's jurisdiction. The duties of the collector in the enforcement of the tax assessed were purely ministerial. The assessment, duly certified to him, was his authority to proceed, and, like an execution to a sheriff, regular on its face, issued by a tribunal having jurisdiction of the subject-matter, constituted his protection.

Whatever may have been the conflict at one time, in the adjudged cases, as to the extent of protection afforded to ministerial officers acting in obedience to process, or orders issued to them by tribunals or officers invested by law with authority to pass upon and determine particular facts, and render judgment thereon, it is well settled now, that if the officer or tribunal possess jurisdiction over the subject-matter upon which judgment is passed, with power to issue an order of process for the enforcement of such judgment, and the order or process issued thereon to the ministerial officer is regular on its face, showing no departure from the law, or defect of jurisdiction over the person or property affected, then, and in such cases, the order or process will give full and entire protection to the ministerial officer in its regular enforcement against any prosecution which the party aggrieved thereby may institute against him, although serious errors may have been committed by the officer or tribunal in reaching the conclusion or judgment upon which the order or process is issued.

Now, the replication to the second special plea did not deny the jurisdiction of the assessor to make an assessment under the circumstances alleged in the plea; nor that the assessment made by him was duly certified to the defendant as collector of the district, with an order to proceed to enforce it, nor that the property assessed was subject to taxation; but only averred that the assessment made was not chargeable against the plaintiff, because he had not manufactured and sold or removed the property assessed within the period mentioned, and had paid all the taxes chargeable against him upon such property-an averment which, if true, would only have shown that the assessor had erred in his judgment in making the assessment, and could not have controlled the action of the collector, nor have justified him in suspending the enforcement of the tax. A judgment debtor might as well complain of the enforcement of an execution by a sheriff on the ground that the court erred in finding that he was indebted to the plaintiff and so giving judgment against him.

An immaterial issue having been thus tendered the proper course for the defendant to pursue was to demur to the replication, and thus force the plaintiff to join issue on the merits of the defence pleaded, or to allow judgment to pass against him. Had the issue here made been the only one in the case tendered to the defence pleaded by the second special plea, the defendant, not being able to set up that defence under the general issue, would have been entitled after verdict to an arrest of judgment and an award of repleader. But such was not the fact here. The first special plea set up the same defence as the second. In both of the special pleas the defendant justified the seizure and conversion of the property, described in the declaration, as collector of internal revenue, under an assessment against the plaintiff duly made by the assessor of the district and certified to him. The difference in the language used in the two pleas, and in the particularity with which the assessment of the tax and the distraint and sale of the property were set forth, did not change the substantial identity of the defence made.

Now the replication of de injuri a, which was interposed to the first special plea, put in issue the material averments of that plea. It threw upon the defendant the burden of proving so much of the plea as constituted a defence to the action. As no error in the ruling of the court on the trial is presented, we are forced to presume that the defendant was afforded every opportunity allowed by law to establish the facts averred by him. To arrest judgment upon the verdict rendered on this issue because an immaterial issue was formed upon a replication to another plea setting up the same defence, and award a repleader, would be in effect to allow the same matter to be twice tried. Such being the case, the granting or refusing the motion rested in the discretion of the court below, with which this court will not interfere.

We are aware of numerous decisions in this country to the effect that the replication de injuri a is only a good replication where the plea sets up matter of execuse, and is not good where the plea sets up matter of justification, though the justification be under process from a court not of record, or rest upon some authority of law other than a judgment of a court. Such are the decisions of the Supreme Court of New York, and they proceed upon the supposed doctrine of the resolutions in Crogate's Case. But an examination of that case will show that the doctrine is not supported to the extent laid down in the New York decisions. The third resolution in Crogate's case does state that a replication de injuri a is bad where the justification is under authority of law, but, as observed by Mr. Justice Patteson, in Selby v. Bardons, this, if taken to the full extent of the terms used, is inconsistent with that part of the first resolution which states that where the plea justifies under proceedings of a court not of record the replication may be used. In that case the declaration was in replevin for goods and chattels. The avowry of the defendant stated that the plaintiff was an inhabitant and occupier of a tenement in a certain parish; that a rate for the relief of the poor of the parish was duly made and published, in which the plaintiff was rated at seven pounds; that he had notice of the rate and was required by the defendant, as collector, to pay the same, which he refused; that he was then summoned before two justices to show cause why he refused; that he appeared, but showing no cause, the justices issued a warrant to the defendant to distrain the plaintiff's goods and chattels, under which he, and the other defendant as his bailiff, took the goods and chattels mentioned in the declaration. To this avowry the plaintiff filed the plea of de injuri a, to which a special demurrer was interposed assigning for cause that the plea offered to put in issue several distinct matters, and was pleaded as if the avowry consisted wholly in excuse of the taking and detaining and not as a justification and claim of right. The court considered at length both causes, and held that the plea was good. On error to the Court of Exchequer Chamber this ruling was affirmed, and the decision, it is believed, has never been departed from in the English courts. The plea de injuri a in this case to the avowry stands like the replication de injuri a to a plea setting up similar matter in an action of trespass. There is no distinction in the effect of the plea in one case and the replication in the other. This was held by the King's Bench in the case cited, and by the Court of Exchequer Chamber on error.

This case is authority for the sufficiency of the replication to the first special plea. Other cases might be cited to the same purport. The decisions in England on this point will be found collected in a learned note to Crogate's case by Mr. Smith in his Leading Cases, and the decisions in this country will be found collected in an equally learned note by the American editors of that work.

But aside from the considerations mentioned, however the replication might be regarded in some courts on special demurrer, its defective character, if at all defective, was cured by the verdict. The objection to its sufficiency to put the averments of the plea in issue cannot be raised after verdict.

JUDGMENT AFFIRMED.


text: Talk:Erskine Collector v. Hohnbach/Opinion of the Court


text:
The Key City

APPEAL from the Circuit Court for the Eastern District of Wisconsin; the case being thus:

Young shipped a quantity of wheat on the steamboat Key City, a vessel owned by a corporation called the Northwestern Packet Company, which had this and several other steamboats engaged in the navigation of the Upper Mississippi River. The cargo was lost, and so never delivered. At the time when the shipment was made and the cargo lost on the Key City, there was engaged in the same business in the same waters with the Northwestern Packet Company, a rival corporation known as the La Crosse and Minnesota Steam Packet Company.

After the loss of the wheat, these two companies united their stock in trade, their steamboats, barges, and other property, and formed a new corporation, the corporators of which were taken exclusively from those in the two old companies; and to the new corporation they gave the name of the Northwestern Union Packet Company. To this company all the property of the two other companies was transferred by appropriate instruments. Whether at the time of this union and transfer the La Crosse and Minnesota Company owed debts or not, or what became of them, did not appear. But it did appear that the Northwestern Company, the original owner of the Key City, was largely indebted, and that this was well known to all the parties. Not only was it well known, but provision was made for the payment of the debts generally of that company by the newly formed company out of a fund to come within its control. The nature of that provision was this: certificates of stock of the value of the boats, barges, and other property of the Northwestern Company merged in the new company were issued, but on their face they recited that no dividends would be paid on such stock until the debts of the Northwestern Company should be paid out of the proportion of the net profits which the shareholders of that company would otherwise be entitled to.

In this state of things, Young, three years and a half after the wheat was lost, and his cause of action had accrued, filed a libel in admiralty against the Key City for its failure to perform its contract of affreightment. The Northwestern Union Packet Company, that is to say, the new corporation, appeared as claimants, ant set up as a defence that the lien was lost by the lapse of time, to wit, the three years and a half which had intervened between the date when the cause of action accrued and the date of the commencement of the suit; and that defence was sustained by the Circuit Court. The change in the ownership of the vessel during the interval was relied on as strengthening the defence.

Mr. J. W. Cary, for the appellant:

1. Professor Parsons says as follows:

'It has been decided that neither the statute of Anne limiting suits in the English admiralty, nor the statute of limitations of any of our States, is of any force in our admiralty. Whether a claim is to be considered stale or not must depend upon the peculiar circumstances of each particular case, and it is difficult to lay down any general rule. It is, however, we think, evident that a party may have a suit in personam, when be cannot sue in rem; because in this latter case, the rights of a bon a fide purchaser may intervene. If the vessel remains in the hands of the owners who were in possession at the time the debt accrued, an action may be brought after a considerable lapse of time. But if the vessel has been sold to a bon a fide purchaser, the suit should be brought as soon as an opportunity is presented; and if it is not, a delay is fatal.'

The position laid down in this last sentence rests alike on reason and authority.

It rests on reason, because admiralty liens are secret; they are not accompanied by possession, and there is no record of them, as in the case of chattel mortgages. It rests equally on authority. In The Admiral, decided by Sprague, J., a collision occurred October 7th, 1852. The vessel continued for some months plying on her old course, and was then sold to a stock company, and stock in the company given in payment. On a libel being afterwards filed the judge dismissed the libel. He says:

'The rule adopted in courts of admiralty, is to allow the continuance of the lien until a reasonable opportunity is given to enforce it. If a party neglects to avail himself of it, third persons are not to be prejudiced by his delay.'

In The Louisa, the libel was for a seaman's wages, and was filed in November, 1845, for wages, commencing in March, 1842, and ending in November after. The vessel in the interim had been sold, and one of the old owners was insolvent. Both the District and Circuit Courts refused to sustain the libel, on the ground 'of the long delay to resort to the vessel, and when, in the meantime, the owners had changed and one of them become insolvent.'

In The Buckeye State, it was held that a delay of three years to enforce a lien by a material-man, was a bar to recovery, and the libel was dismissed for that reason, a third person in the meantime having become the owner of the boat.

In The Lillie Mills, supplies were furnished in March, June, and October, 1853, and the libel was filed October, 1855; a change of ownership having previously occurred. Sprague, J., says:

'When the rights of third persons have intervened, the lien will be regarded as lost, if the person in whose favor it existed has had a reasonable opportunity to enforce it, and has not done so. This is the well-settled rule in admiralty.'

In The General Jackson, the supplies were furnished September, 1852. The vessel was sold to the claimant in May, 1854, and the libel filed about eighteen months after supplies furnished. Sprague, J., says:

title: The Key City


text: Talk:The Key City

title: Talk:The Key City


text:
The Key City/Opinion of the Court

'During all that period the vessel was plying between this port and the ports of Maine, as often as once a month, giving the libellant ample opportunity to enforce his claim, had he seen fit, long before the sale of the vessel to the present claimant. It must, therefore, be held that the libellant has waived his lien.'

2. Was there then a bon a fide change of ownership of this particular boat, the Key City, May the 1st, 1866? Of this there can be no doubt. Prior to that time the boat was owned by the Northwestern Packet Company; after that it was owned by the Northwestern Union Packet Company, an entirely different corporation, with different stockholders, and holding their interests in different proportions. There is no pretence that any notice of this lien was given to the new company, or that they ever had any knowledge of it until the marshal took possession of the boat. The two old companies remained corporations, legal existences, notwithstanding the formation of the new company and the sale to it of this property. There was no consolidation or legal union of the two. The old companies remained liable to suit and liable for their debts, and the individual stockholders were also liable if they had appropriated the property of the company. The property of the Northwestern Packet Company was paid for in stock of the new company, which was a good and valid payment, as much so as if paid in money. The new company was to pay the debts of the old out of the earnings of the new, in certain proportions, but in no other way. Dividends were withheld and applied for that purpose. To allow this suit to prevail would affect the rights, stock, and property of all the stockholders unjustly and inequitably. The new company cannot be subjected to this proceeding. The claimant could be compelled to appropriate net earnings belonging to the Northwestern Company or to the stockholders who were of that company, after a debt had been established. The libellant could have pursued the Northwestern Company, and after judgment its stockholders, for the stock held in the new company.

Does the fact that the stockholders of the Northwestern Company were paid, but in stock of the new company, alter the case? We think not. In The Admiral, already cited, and where after the collision the vessel was sold to a stock company, and stock in the company given in payment to the former owners, the court say:

'It is said all the former owners of the Admiral were stockholders in the claimant's company, and that thus the corporation is affected with knowledge of this lien. It does not appear that they owned in the company in the same proportion as before, and if it did, it would make no difference, because there were other stockholders in the company who took in ignorance of the claim, and they ought to be protected. The former owners became merely stockholders in the new company, and their knowledge does not affect the corporation with knowledge. The difficulty is, that as this is a process in rem, and the boat the property of the corporation, there is no process to reach the interests of the former owners without affecting the interests of others who purchased innocently. The boat is now owned by a corporation and not by individuals. The persons owning do not own as before any part or rights in the boat, but they own stock in the company.'

The mere conveyance of a vessel, even to an innocent purchaser, without notice, will not of itself necessarily disturb a maritime lien.

In order to defeat the lien, some other circumstance than mere lapse of time should be made to appear, before the equity, upon which the doctrine is based, can arise.

In The Batavia, Lord Stowell concluded upon the facts proven, that the transfer was merely colorable to avoid payment of certain port charges and duties at Batavia, hence no equity in the purchaser to demand a discharge of the lien.

In Willard v. Dorr, while Story, J., passing on the question, says in substance, that courts of admiralty, like courts of equity, will refuse their aid to enforce old, dormant demands, and that it prescribes a rule to itself, by analogy to statutes of limitation, yet enforced a remedy after twelve years had elapsed; no equitable circumstance appearing, to bring the case within the rule suggested.

In The Admiral, relied on by opposing counsel, stress is laid by the court upon the circumstance that the cause of action was a collision; that the facts were denied, and the witnesses dispersed. The purchasers were without notice, and without ability to contest the claim upon the facts.

In the present case the new company received its conveyance with notice of an existing debt, and covenanted to pay it. The validity of our demand is conceded, and the new company received and still holds a full consideration for what it covenanted. That we could, in equity, compel the performance of such covenant will not be doubted. What consideration arises here-what condition-to demand that our maritime lien be discharged more than would have arisen had the vessel remained in the hands and ownership of the Northwestern Packet Company? The rule, relied on by opposing counsel, exists and is enforced for the protection of innocent purchasers without notice, and as against whom it would be inequitable to decree payment of another's debt, but the rule does not apply. If there be a recovery here, it will be charged in account to the Northwestern Packet Company; and it is not denied that the respondent has an abundant indemnity fund. The fact that dividends were to be retained from the stockholders of the old companies to answer their old debts, is a material feature in this case. No such feature existed in the case of The Admiral.

Mr. Justice MILLER delivered the opinion of the court.

The authorities on the subject of lapse of time as a defence to suits for the enforcement of maritime liens are carefully and industriously collected in the briefs of counsel on both sides, to which reference is hereby made without specifying them more particularly.

We think that the following propositions as applicable to the case before us may be fairly stated as the result of these authorities.

1. That while the courts of admiralty are not governed in such cases by any statute of limitation, they adopt the principle that laches or delay in the judicial enforcement of maritime liens will, under proper circumstances, constitute a valid defence.

2. That no arbitrary or fixed period of time has been, or will be, established as an inflexible rule, but that the delay which will defeat such a suit must in every case depend on the peculiar equitable circumstances of that case.

3. That where the lien is to be enforced to the detriment of a purchaser for value, without notice of the lien, the defence will be held valid under shorter time, and a more rigid scrutiny of the circumstances of the delay, than when the claimant is the owner at the time the lien accrued.

Counsel for the appellees argue that the libel in the present case was rightfully dismissed under this last proposition; and we are of opinion that if the claimants had shown an ordinary case of purchase and payment without notice, the lapse of time would protect them. While on the other hand we are of opinion that if the claimant had been the owner when the lien accrued, it would not be a good defence in this instance.

We must, therefore, inquire into the special circumstances under which the claimant became the owner of the vessel against which the lien is asserted. These show that there was no sale of the property of one of these original corporations to the other, but that they agreed to unite their property and their interests, and for convenience assumed a new corporate name; that in doing this they recognized a large and undefined indebtedness on the part of the Northwestern Company, and provided for its payment out of the earnings otherwise payable to that company. No doubt these debts were most of them, like the present one, liens on the property of that company, and known to be so by all who united in the transaction. And, finally, that neither the stockholders of the La Crosse and Minnesota Company, nor of the new corporation, have ever parted with or paid any money or other thing of value for the Key City, otherwise than by this consolidation of the companies into one; and it is not apparent, nor even a reasonable presumption, that if the new company has to pay the libellant's debt in this case they will be the losers, but it is nearly certain the loss will fall where it should, on the stockholders coming in through the Northwestern Company.

We do not see, under these circumstances, how the claimants can avail themselves of the rule for the protection of purchasers without notice.

DECREE REVERSED, with directions to enter a decree for libellant for the amount due him for his wheat lost by the Key City,

WITH INTEREST BY WAY OF DAMAGES.

title: The Key City/Opinion of the Court


text: Talk:The Key City/Opinion of the Court

title: Talk:The Key City/Opinion of the Court


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Delmas v. Insurance Company

662

ERROR to the Supreme Court of Louisiana; the case being this:

J. Menard, of New Orleans, gave to one Delmas an obligation, the consideration of which (as was said) was Confederate money. On this obligation Delmas obtained a judgment. Subsequent to the date of the obligation given, as above said, the State of Louisiana adopted a new constitution of government, the 127th article of which thus ordained:

'All agreements, the consideration of which was Confederate money, notes or bonds, are null and void; and shall not be enforced by the courts of this State.'

So far as to Delmas and the debt to him.

The same Menard, above mentioned, gave also, May 28th, 1857, to the Merchants' Insurance Company, a note payable at one year, and secured by mortgage. On the 16th March, 1866, the note was thus indorsed:

'The payment of this note is without novation extended to 1st of December, 1866.

'J. MENARD.'

The mortgage also was reinscribed; but to neither the extension of the note nor to the reinscription of the mortgage was there any stamp affixed.

The Stamp Act of June 30th, 1864, it is here perhaps necessary to remind the reader, specifies in a schedule a great number of instruments of writing (not including, however, either the extension of the time of payment of a promissory note, or the 'reinscription' of a mortgage) on which stamps must be affixed, and prescribes the amount of the stamp; and says, also:

'Agreements or contracts other than those specified in this schedule, 5 cents.'

In this state of things, one Henderson-having in his hands a sum of money belonging to Menard, on which both Delmas and the insurance company set up respectively liens under the judgment and mortgage above mentioned-filed a bill in one of the State courts of Louisiana, in the nature of an equitable bill of interpleader, to have it determined by the court to which of the claimants upon it the noney should rightfully be paid. Coming in to interplead, the insurance company, on the one hand, impeached the judgment of Delmas because it was based upon a contract the consideration of which was Confederate money; and Delmas, on the other, impeached the mortgage of the insurance company because neither the extension of the note nor the reinscription of the mortgage had a stamp affixed to it.

The court where Henderson filed his bill decided both matters in favor of the insurance company; and the Supreme Court of Louisiana, where the matter went on appeal, did the same.

As respected the matter of the consideration of Delmas's note, it said (assigning no other reason):

'His judgment was based on a contract or agreement the consideration of which was Confederate money. ''To render the decree asked for would be to enforce a prohibited agreement. (Article 127 Constitution''.)'

In thus stating the reasons of its judgment, the Supreme Court of Louisiana followed the Code of Practice of the State, which requires it to state those reasons by citing as exactly as possible the law on which it founds its opinions.

As respected the stamps, it decided that the extension of time on the note was not such an agreement as required stamps; nor the reinscription of the mortgage either. From this decision Delmas brought the case here, as within the 25th section of the Judiciary Act, alleging that the validity of the article 127 of the Constitution of Louisiana had been drawn in question as impairing the provision of the Federal Constitution forbidding any State to pass a law violating the obligation of contracts, and that the Supreme Court had decided in favor of its validity, and also because the construction of an act of Congress about stamps had been drawn in question, and that the court below had decided that it was inapplicable.

Mr. T. J. Durant, for the plaintiff in error:

The renewal of the note is clearly a new agreement, and comes under the head of 'Agreements other than those specified in this schedule.'

The same may be said of the reinscription of the mortgage. A mortgage to affect third persons must be publicly inscribed on records kept for that purpose. This prescrves the mortgage during ten years. The effect ceases, even against the contracting parties, if the inscriptions have not been renewed before the expirations of their time, in the manner in which they were first made. Nothing could come more completely within the meaning of the Stamp Act than such a reinscription; it is a renewal of the mortgage, and that is the case provided for in Schedule B.

Mr. A. G. Riddle, for the defendant in error:

The extension of the note did not require to be in writing at all, and neither the extension nor reinscription required a stamp.

On the other matter this court has no jurisdiction. In Bethel v. Demaret, a writ taken under an assumption that the case was within the 25th section, seems to settle the case. The syllabus there is: 'The decision of a State court which simply held that promissory notes given for the loan of 'Confederate currency,' together with a mortgage to secure the notes, were nullities on the ground that the consideration was illegal according to the law of the State at the time the contract was entered into, is not a decision repugnant to the Constitution.'

The writ in that case was accordingly dismissed, as not within the 25th section. So we ask that this one may be. The judgment of the Supreme Court of Louisiana would have been the same if the article 127 had not been referred to.

Mr. Justice MILLER delivered the opinion of the court.

title: Delmas v. Insurance Company


text: Talk:Delmas v. Insurance Company

title: Talk:Delmas v. Insurance Company