Lead Opinion
Eаch of the libelants herein chartered ships from the Government pursuant to the Merchant Ship Sales Act, 50 U.S. C.A.Appendix, § 1735 et seq., and agreed to various terms of a standard charter, which made the rental price depend in part on the amount of the profit realized by the charterer. The libelants claim that the Maritime Commission, contrary to provisions of the Act, exacted from them too great a percentage of the profits and these actions were brought under the Suits in Admiralty Act, 46 U.S.C.A. § 741 et seq., to recover the illegally collected amounts. The foregoing cause of action is asserted in each of the libels. In several of the cases some payments were made by the shippers after redelivery of the ships and within two years of the filing of the libel. And some of the libelants sought to obtain refund of certain alleged overcharges caused by the Commission’s refusal to allow certain expense deductions and its refusal to permit cumulative accounting under certain circumstances.
In each case, the Government moved to dismiss the libels because of lack of jurisdiction, on the ground that all of thе claims stated therein were barred by the two-year limitation of the Suits in Admiralty Act, 46 U.S.C.A. § 745. As to this, the Government’s position was that the causes of action accrued as of the
Judge Palmieri, in an opinion reported at D.C.,
Before dealing with this question, we note that we are without appellate jurisdiction over the Dichmann, Wright & Pugh appeal. Dichmann, in its reply brief, conceded that, since the second count of its libel was still pending in the District Court, its appeal from the dismissal of the first and third counts was interlocutory. It cited 28 U.S.C.A. § 1292(3) as express statutory authority for us to entertain this appeal. But our authority to entertain interlocutory admiralty appeals is limited by the requirement of 28 U.S.C.A. § 2107 that the appeal be filed within 15 days after entry of judgment. Here, the judgment appealed from was filed on May 22, 1956 and the appeal was not filed until August 10, 1956, — more than 15 days later. The appeal therefore is too late, and must be dismissed. The Fanny D (Eggers v. Southern Steamship Co.), 5 Cir.,
In the appeals which are properly before us, the following facts are pertinent to the issues raised. The Maritime Commission in 1946 was authorized by statute to charter vessels owned by the Government. The statute, 50 U.S.C.A.Appendix, § 1735 et seq., provided for rental rates in § 1738, which incorporated by reference § 709(a) of the Merchant Marine Act, 46 U.S.C.A. § 1199 (a). This latter section provided that every charter executed by the Maritime Commission should contain provision that, whenever the charterer’s adjusted profits exceed a certain amount, the char
However, the libelants objected to the sliding scale rate as illegal before making payment thereunder and obtained from the Maritime Commission the assurance that payments of charter hire were to be deemed preliminary and subject to adjustment until final audit. In recognition of this the Commission inserted Clause 13 in the charters.
The libelants argue that the cause of action for return of charter hire illegally exacted accrued as of the date of final audit, or — at the earliest — when the last payment or credit entry in their account with the Commission was made. In all cases this would avoid the time bar. The Government contends that the statute commenced running as of the date when each libelant redelivered the chartered vessels to the Commission. If this be so, these libels would be time-barred.
We agree with the judges below that the basic issues in this appeal were decided adversely to the appellants in our decision in Sword Line v. United States, 2 Cir.,
The Sword Line case held that a cause of action, such as that presented in these
To avoid the impact of these decisions, the appellants have restated their theories but even as restated most of them were presented and rejected in Sword Line and American Eastern. The “mutual account” or “open account” theory as advanced by Judge L. Hand was rejected by his colleagues in Sword Line,
There remains the contention, forcefully urged by those appellants to whom it is available, that, even if suits for refund of payments made prior to redelivery of the ships are time-barred, the court had jurisdiction over those libels which demanded refund of post-redelivery payments to the Commission which were made within two years of the filing of the libel. (For libels so situated, see the Appendix hereto.) The Government replies that the libelants cannot now demand refund since such payments were voluntary, citing Railroad Co. v. Commissioners,
This point was unmistakably presented and was disposed of without discussion by another panel of this court in Sword Line in an opinion which did not explain why the court lacked jurisdiction of the claim for recovery of the post-redelivery payments. However, the rationale of the opinion in that case which was equally applicable to payments made before and after redelivery, and the rationale of American Eastern, required the orders of dismissal now before us on review. Indeed, in its briefs and its petition for rеhearing in Sword Line, the libelant pointed out that after redelivery and within two years prior to the libel it had paid to the Commission $660,000, which it contended was additional charter hire. Yet the court held that there was no jurisdiction to entertain the claim.
Apparently the only point now pressed which was not determined in Sword Line or American Eastern was raised in the Blidberg libel. This concerned a claim for expenses incurred in repairing latent defects which existed when the ships were received by Blidberg. But this claim was obviously in existence, at the very latest, when the ships were redelivered. Since the libels were not filed within two years of the redelivery these claims are barred. 46 U.S.C.A. § 745.
If the subject-matter of these appeals were res nova, we are by no means sure that our dispositions would coincide with those made by the majority opinion in Sword Line and by American Eastern. However, we will not overrule these recent decisions of other panels of the court. On the authority of Sword Line and American Eastern we hold that these libels also were barred.
Accordingly, the decrees appealed from are affirmed except the Dichmann, Wright & Pugh, Inc. appeal which is dismissed.
Before CLARK, Chief Judge, and MEDINA, HINCKS, WATERMAN and MOORE, Circuit Judges.
Pursuant to libelants’ petitions after the filing of our first opinion in this ease, this court on December 19, 1957 granted rehearing en banc
Each of the libelants herein chartered ships from the Government pursuant to the Merchant Ship Sales Act, 50 U.S.C.A. Appendix § 1735 et seq., and agreed to various terms of a standard charter, which made the rental price depend in part on the amount of the profit realized by the charterer. The libelants claim that the Maritime Commission, contrary to provisions of the Act, insisted on including in the standard charter provisions calling for excessive additional charter hire and these actions were brought under the Suits in Admiralty Act, 46 U.S.C.A. § 741 et seq., to recover such excess.
In each case, the Government moved to dismiss the libels because of lack of jurisdiction, on the ground that all of the claims stated therein were barred by the two-year limitation of the Suits in Admiralty Act, 46 U.S.C.A. § 745. As to this, the Government’s position was that the causes of action accrued as of the time the libelants returned their ships to the Commission, and that this “redelivery” date in all cases was more than two years prior to the commencement of suit.
Judge Palmieri, in an opinion reported at 141 F.Supp. '58,'dismissed all the libels, except those of Blidberg Rothchild and Fall River Navigation Co., and denied leave to amend because, however pleaded, the actions were time-barred.
Before dealing with this question, we note that we are without appellate jurisdiction over the Dichmann, Wright & Pugh appeal. Dichmann, in its original reply brief, conceded that, since the second count of its libel was still pending in the District Court, its appeal from the dismissal of the first and third counts was interlocutory. It cited 28 U.S.C.A. § 1292(3) as express statutory authority for us to entertain this appeal. But our authority to entertain interlocutory admiralty appeals is limited by the rеquirement of 28 U.S.C.A. § 2107 that the appeal be filed within 15 days after entry of judgment. Here, the judgment appealed from was filed on May 22, 1956 and the appeal was not filed until August 10, 1956. The appeal therefore is too late, and must be dismissed. The Fanny D (Eggers v. Southern Steamship Co.), 5 Cir.,
In the appeals which are properly before us, the following facts are pertinent to the issues raised. The Maritime Commission in 1946 was authorized by statute to charter vessels owned by the Government. The statute, 50 U.S.C.A.Appendix § 1735 et seq., provided for rental rates in § 1738, which incorporated by reference § 709(a) of the Merchant Marine Act, 46 U.S.C.A. § 1199(a). This latter section provided that every charter exe
However, the libelants claim that before entering into such charters and be-
fore making payments thereunder they objected to the sliding scale rates as contrary to § 709(a) and hence illegal; that by reason of their objections the Maritime Commission assured them that payments of additional charter hire would be deemed preliminary and subject to adjustment until final audit; and that, as a result of this understanding the final paragraph of Clause 13 was inserted in the charters. In addition, the libelants claim that all parties to the charters operated under the assumption that, until final audit, charter hire payments were merely preliminary. In support of this position, they point to Commission regulations, 46 C.F.R. §§ 299.31 (k) (1), 299.-37-2(a) (1), (2) and (b) (3), to instructions such as the one set out in the margin,
The Government now contends that Clause 13 of the charter is irrelevant to the limitations question and that the statute, of necessity, began to run on the date of payment with the result that all of the libels herein involving payments made before the date of redelivery are time-barred. The Government also argues that jurisdiction is lacking over libels for recovery of payments made after redelivery even if made within two years of suit because such payments as a matter of law were “voluntary” within the meaning of Railroad Co. v. Commissioners,
The issues before us have been presented to this court twice before, although in not such comprehensive and forthright manner as in the present case. In Sword Line, Inc., v. United States, 2 Cir.,
The panel of this court which delivered the original opinion on these appeals — • the opinion now withdrawn — felt unwilling to depart from the authority of those cases. But now that the court on rehearing has undertaken to proceed en banc, we feel under somewhat less constraint from our past decisions and consider anew, on the intrinsic merits, the issues now before us.
We have come to the conclusion that the rights of the parties to these charters, so far as additional charter hire is concerned, are governed by Clause 13. This is not the case, frequently occurring, in which money has been collected by the Government by virtue of a statutory direction. The statute involved
When the libelants raised their contentions below, and in earlier cases, the Government’s position was that Clause 13 was entirely irrelevant. Consequently, the Government never attacked the libel-ants’ asserted interpretation of that clause: it filed no answers and its excep-tive allegations raised no issues of fact. On this rehearing, however, for the first time the Government argues that even if Clause 13 is controlling on the limitations issue the libelants are misinterpreting the language of that clause: it now for the first time suggests that “each final audit” in Clause 13 means each annual audit. But this dispute as to interpretation is plainly one that now appears to involve questions of fact on which extrinsic evidence is admissible. The parties never had occasion to present such evidence. And the particular problem of interpretation has never been passed upon by any judge in these cases or in any other that has been brought to our attention.
As to the interpretation of Clause 13 and its effect upon claims for the recovery of additional charter hire, we have been presented on appeal with many arguments based on facts alleged in briefs and affidavits, some but not all of which were part of the record below. But since the issue was not raised below, probably because the Government thought it irrelevant under the Sword Line decision, we think the cases should be remanded and the issue should be submitted to the trial judges for findings and determination after giving the Government opportunity to raise such issues of fact as may be desired. This is a case in which parol evidence is admissible on the disputed issue as to interpretation of the charters, Corbin on Contracts, Vol. 3, § 579, and we think we should wait until the relevant record of fact below has been made and completed before we commit the court to any particular interpretation. Our preview, on this appeal, of the contentions of the parties as to Clause 13 leads us to suggest that issues framed thereby are peculiarly appropriate for determination on such evidence as the parties may offer rather than on affidavits. Pacific-Atlantic Steamship Company v. United Stаtes, D.C.D.Del. 1955,
The true intent of Clause 13 having been ascertained, it can then readily be determined whether these suits in so far as they seek recovery of additional charter hire have been brought within the two-year limitation. And any suit thus found to have been timely brought should then, of course, be heard and decided on the merits.
Certain of the libels also include claims not directly based upon the asserted illegality of the progressive rate of additional charter hire under Clause 13. Thus, it is alleged that the Commission, for accounting purposes, improperly split the year 1947 into two segments which had the effect of unduly increasing the libelants’ charter hire liability. The Commission’s construction of the cumulative accounting provision is also asserted to have improperly increased the libel-ants’ charter hire liability. One libelant asserts that the phrase “capital necessarily employed” as used in Clause 13 has
A different situation, however, prevails with regard to Blidberg’s claim for refund of expenditures for latent defects existing at the time the vessels were delivered on charter as contained in its sixth cause of libel. Such a claim does not come within the express provision of Clause 13 which reserves disputes concerning “additional charter hire.” The accrual of this claim, therefore, was not deferred until the final audit and consequently it is time-barred. Isthmian Steamship Co. v. United States, D.C.S.D.N.Y.,
To the extent that Sword Line and American Eastern are inconsistent with rulings indicated above, they are overruled.
The appeal of Dichmann, Wright & Pugh, Inc. is dismissed. All other decrees appealed from are reversed and the suits are remanded for further proceedings in accordance with this opinion, except that the dismissal of Blidberg’s sixth cause of libel is affirmed.
Notes
. A few of the libels alleged disputes as to the valuation of specific items entering into the cost basis upon which the profits were calculated. These included differences concerning the amount of “capital necessarily employed,” the “post redelivery overhead expenses,” the “cost of repairing latent defects,” “management fees” and “agency fees.”
. “November 5, 1956
Memorandum
“Libelant here seeks to recover from respondent alleged overpayments made pursuant to its charter of certain Government-owned vessels. Libelant further seeks leave to amend its libel in order to allege, in fuller detail, the transactions giving rise to the alleged causes of action.
“Respondent excepts to the libel as time-barred under Suits in Admiralty Act, 46 U.S.C.A. section 741, et seq., and opposes the proposed amended libel on the theory that, as amended, the libel still fails to state a cause of action accruing within the required two-year limit prior to the date of filing of thе libel.
“Respondent’s exception is sustained; libel dismissed. Libelant’s application for leave to amend is denied.
“The points now at issue before the Court have been too well-settled by recent authoritative decisions as to require consideration de novo. Sword Line v. United States, 2 Cir., 1955,
“Settle order on notice.
William B. Herlands United States District Judge.”
. “Cifrase 13. Additional Charter Hire. * #
“The Charterer agrees to make preliminary payments to the Owner on account of such additional charter hire and on account of any additional charter hire accrued under any War Shipping Administration Form 203 (Warshipdemise-out) charter (prior to the times of payment provided for above or in such War-shipdomiseout charters) at such times find in such manner and amounts as may be required by the Owner; provided, however, that such payment of additional charter hire shall be deemed to be preliminary and subject to adjustment either at the time of the rendition of preliminary statements or upon the completion of each final audit by the Owner, at which times such payments will be made to the Owner as such preliminary statements or final audit may show to be due, or such overpayments refunded to the Charterer as may be required.”
. “Where a voucher check is tendered by the Charterer, it is requested that no reference be made thereon through restrictive legend or otherwise to the effect that it is a final settlement. The accompanying letter of transmittal should state that the remittance is on account of additional charter hire due the Maritime Administration and is subject to adjustment upon the completion of final accounting between the Charterer and the Maritime Administration and that neither the tender of such payment by the Charterer, nor its acceptance by the Maritime Administration shall be construed as an approval of the correctness of the amount thereof, nor as a waiver of the rights or remedies of either party under the terms of the agreements involved or otherwise.” (May 14, 1951 letter from Maritime.)
. Judge LOMBARD has not participated in this appeal.
. This action was required under the holdings of prior decisions of this court which will be discussed in this opinion.
. “Clause 13. Additional Charter Hire.
If at the end of the calendar year 1946, or any subsequent calendar year or at the termination of this Agreement, the cumulative net voyage profit (after the payment of the basic charter hire here-inabove specified and payment of the Charterer’s fair and reasonable overhead expenses applicable to operation of the Vessels) shall exceed 30 per centum per annum of the Charterer’s capital necessarily employed in the business of the Vessels (all as hereinafter defined), the Charterer shall pay over to the Owner at Washington, D. C., within 30 days after the end of such year or other period, as additional charter hire for such year or other period, an amount equal to the percentages of such cumulative net voyage profit in excess of 10 per centum per an-num on such capital computed in accordance with the following table (but such cumulative net profit so accounted for shall not be included in any calculation of cumulative net profit in any subsequent year or period) :
“Cumulative net voyage profit (in excess of 10% per annum on capital necessarily employed) not in excess of $100 per day — 50%.
“Cumulative net voyage profit (in excess of 10% per annum on capital necessarily employed) in excess of $100 per day but not in excess of $300 per day — 75% on such excess over $100 per day.
“Cumulative net voyage profit (in excess of 30% per annum on capital necessarily employed) in excess of $300 per day — 90% on such excess over $300 per day.
“The Charterer agrees to make preliminary payments to the Owner on account of such additional charter hire and on account of any additional charter hire accrued under any War Shipping Administration Form 203 (Warshipdemiseout) charter (prior to the times of payment provided for above or in such Wurship-demiseout charters) at such times and in such manner and amounts as may be required by the Owner; provided, however, that such payment of additional charter hire shall be deemed to be preliminary and subject to adjustment either at the time of the rendition of preliminary statements or upon thе completion of each final audit by the Owner, at which times such payments will be made to the Owner as such preliminary statements or final audit may show to be due, or such overpayments refunded to the Charterer as may be required.”
. “Where a voucher check is tendered by the Charterer, it is requested that no reference be made thereon through restrictive legend or otherwise to the effect that it is a final settlement. The accompanying letter of transmittal should state that the remittance is on account of additional charter hire due the Maritime Administration and is subject to adjustment upon the completion of final accounting between the Charterer and the Maritime Administration and that neither the tender of such payment by the Charterer, nor its acceptance by the Maritime Administration shall be con
. For purposes of this opinion it is not necessary to pass upon this contention. We observе, however, that carried to its logical conclusion the contention is that every issue going to the merits is jurisdictional.
. As to the timeliness of the libels, cer-tiorari was denied.
Dissenting Opinion
(dissenting).
I concur with the majority that the purported appeal in No. 24283, Dich-mann, Wright & Pugh, Inc. v. United States, should be dismissed for lack of appellate jurisdiction.
With respect to the issues relative to jurisdiction that the majority find to have been raised in the other thirteen cases and which in their judgment require remand to resolve, I concur in the dissenting opinion of Judge CLARK. I would hold, with him, that the respective written instruments in each case, all of which contain the identical Clause 13, need no further judicial consideration below to make them properly interpretable, and that the interpretation placed upon these charter-parties in his dissent is a proper and justifiable one. I believe we should decide now, without more, whether these cases, case by case, are so time-barred as to deprive the courts of any jurisdiction over the respective alleged causes of action, and in the course of so doing I would follow our previous holdings in Sword Line, Inс., v. United States, 2 Cir., 1955,
Dissenting Opinion
(dissenting).
Despite many years on the bench I have still to find an acceptable formula for appellate disposition of a case where the adjudication below gives concern, but falls short of clearly demonstrable error. Of this at least I do feel sure, that a court of review should not attempt to relieve itself of responsibility — get itself off the hook — by merely remanding, i. e., passing the buck back, to the trial court. It should remand only when it has a clear concept of what the trial judge can do to advance the case to final adjudication and precisely states that for his benefit and the benefit of the litigants thus subjected to tantalizing delay.
These basic requirements seem to me quite unfulfilled in the decision herewith. The mandate is merely for remand “for further proceedings in accordance with this opinion.” The opinion proper has some further vague suggestions or directions for the “framing” of issues — apparently many of them — and for the taking of testimony — evidently extensive and unlimited — as to each. But the opinion itself demonstrates by the controlling force it gives to Clause 13 of the charters that there is really but a single issue, namely, the interpretation of a written instrument. And on this the record is already complete and the case ripe for final ruling. More precisely stated the issue is whether Clause 13 can be interpreted to control and set aside the normal rule — - relied on in our earlier rulings on the issue
To understand what is happening we must consider the state of the existing record before remand. What we are dealing with is a “built-in” statute of limitation forming a very direct boundary to the grant of remedy against the sovereign. 46 U.S.C. § 745. This is important in several ways. It shows the strong legislative policy against stale claims against the government. It clearly places the burden of proof upon the claimants to show that they properly come within an unrestricted class. And since it thus vitally delimits the court’s jurisdiction, it makes appropriate and normal the usual processes for the testing of issues of federal jurisdiction, as actually had here, namely, motion and affidavit.
It is, indeed, a reflection upon able and shrewd counsel to believe that, faced with the legal requirement and practical necessity of disclosure, they should have held back relevant and convincing material. One of the more confusing aspects of the decision is that it is not clear how far it is intended to repudiate the normal procedure for testing issues of federal jurisdiction as shown by the cases cited in my footnote 2 supra. In any event we cannot expect miracles of counsel; anything more they bring to a new trial will be only cumulative to what is already before us. Obviously were there oral evidence of direct statements of intent on the part of the negotiators now presently remembered (none has been suggested), such evidence could not be used to control or vary the written document. All the material useful for decision is actually at hand; I do not see why my brothers do not employ it for final adjudication that jurisdiction exists if such is the way they feel they must go. The obstacles will not be any the less after two or three more years of protracted litigation.
That this is their direction is, I think, to be fairly deduced from the opinion, even though the discussion therein is limited. Not only does it accept the text of Clause 13 as “an adequate, prima facie, showing of jurisdiction,” but it takes the highly drastic and quite confusing course of overruling out of hand our two previous rulings to the contrary cited in my note 1 supra. What reason is there for overruling Sword Line and American Eastern if eventually they may be held correctly decided? Indeed, in the present state of division in the court, what reason or effect is there to this declaration in any event?
Let us look more closely at this “prima facie” ruling. In interpreting the writing we must start with the congressional policy disfavoring stale claims. I see no reason here for exceptional treatment. The contracts were made, the services performed, and the payments made a decade or more ago. And what is more, the ships were actually returned to the government, thus entirely closing the transactions, almost a decade ago. It is especially strange, if these were live issues where the government was expected to make vast refunds, that some of the rental payments were actually made after the ships were returned.
Turning now to Clause 13 itself— quoted in full in the opinion — it should be noticed that it is not a provision for claim adjustment; nor does it in any way suggest that it was meant to deal with the processing of claims for refund. Clearly it is what it is labeled as being, namely, a provision for “Additional Char
In the final paragraph of Clause 13 the preliminary statements therein referred to are correlated with the final audit. This places a well-nigh insuperable obstacle in the way of the interpretation claimed by libelants. For the “adjustment” visualized is to be had “either at the time of the rendition of preliminary statements or upon the completion of each final audit by the Owner”; the idea is carried further thus, “at which times such payments will be made to the Owner as such preliminary statements or final audit may show to be due, or such over-payments refunded to the Charterer as may be required.” Each final audit therefore serves a function of settling the payments due on each calendar year’s profits. Thus it fits properly with the rest of the clause. It cannot be made to mean some final settlement of all and sundry differences a decade or more hence when at length both parties are prepared to have a balance struck. Thus the government’s brief is correct in saying: “Thus the charterеrs’ right to file a claim for adjustment and refund of an overpayment of additional hire and to bring immediate suit if refund was not made is precisely the same at the time of a charterer’s rendition of its preliminary accountings and at the time of the owner’s final audit.”
This natural construction is supported by various Maritime Administration regulations which (1) require the charterer at the end of each calendar month to pay 90 per cent of the additional charter hire then indicated to be due, 46 CFR 299.31 (k) (1); (2) provide that such payments are preliminary and subject to adjustment upon completion of audit by the government covering the period involved (the calendar year), id.; (3) provide that tender of the monthly payments and their acceptance do not prejudice rights under the charter or otherwise, id.; (4) require remittance of monthly payments to be accompanied by a preliminary statement, 46 CFR 299.31 (k) (2); (5) provide that if this statement indicates that 90 per cent of the cumulative total for the expired portions of the periods involved (calendar year) is less than the total of payments theretofore made for the period, the charterer may apply for a refund, 46 CFR 299.31(k) (5); and (6) require each charterer to submit a separate final accounting of additional charter hire for each annual or over-all accounting period [which under 46 CFR 299.-37-l(h) and (i) is defined as a calendar year or a period less than a calendar year, 46 CFR 299.37-2(b)]. Hence, simply put, Clause 13, read with the regulations, provides that the charterers must make monthly payments on account of the additional charter hire which are preliminary because only upon the rendí
Neither in wording nor in practical operability, however, is the Clause appropriate for the adjustment of the type of “overpayment” here involved. For the charterers knew that as they read the law the sums here claimed were not correct even when remitted. So there is no suggestion anywhere in the contract that the earlier language in Clause 13 bears on these “overpayments” in any way. Nor is there any suggestion in Clause 13 or in the regulations that the preliminary payments are tentative because the charterers believed the Clause to be illegal or that the parties agreed to put off a judicial determination of the legality of the rates. It is a strange contract which would preclude suit by the charterers to reform the contract or to recover the specific monthly “overpayments” if actually illegal. But, as the opinion herewith makes clear, libelants to succeed must rely on such an interpretation, viz., that the phrase “each final audit” can mean only some type of closing-out accounting which ultimately and finally terminates all relations between the charterers and the United States. I submit with all deference that the mere statement of the argument betrays its weakness; without fairly conclusive support somewhere for such a reading there is no “prima facie showing of jurisdiction.” Surely the parties did not intend an agreement to require the deposits of huge sums of money for an indefinite time pending determination of the legality of the contract rates. For quite clearly the period of limitation can start only when the parties agree and are content that they have eventually obtained an ultimate closing-out accounting. Ironically enough, since even late deposits are to be included, there is nothing to prevent the charterers from continuing to make the government a good and safe depositary, paying better than market rates of interest, for their excess funds. Hence for my part I cannot accept this as permissible interpretation against respondent’s persuasive showing (wholly consistent with both the charters and the .regulations) that “each final audit” means an audit of the charterers’ yearly profits.
It is true that the libelants ably and ingeniously develop various arguments from the background material in an endeavor to combat this analysis. Doubtless they will fashion others if allowed to prolong the proceedings. But the very ingenuity exercised, viewed against the results achieved, suggests how pressing is their need for an argumentative support which they still find lacking. It hardly seems worth while now to discuss these arguments at length beyond a general suggestion of their weakness. They deal either with supposed inconsistencies with the government’s present position, such as segregatiоn of accounts or the like, or with claimed admissions by the Maritime officials. The principle against waiver of public rights by government officers would make these dubious in any event; but even more important is the fact that the inconsistencies or waivers are apparent only to those predisposed to see them. They obviously did not occur to the officials at the time. Unconscious waiver of public rights is not a legal principle to be pressed far.
The opinion states that the government for a considerable time concealed its present and ultimate contention. That charge, if important, does not seem to me to be sustained on the record. Appellants have vacillated in the theories they would rely upon, and seemingly have come to a choice of Clause 13 only recently. As the case developed there was not early occasion for the government to be more specific in its opposition (which has always been steady and continuous) than it has been. And its position has been reasonably well known, as was apparent in the earlier cases before us. So Judge Walsh, ably analyzing these points in the trial court in the American Eastern case, D.C. S.D.N.Y.,
“The labyrinthine aspects of the charter and regulations which libel-*153 ant has seen fit to exaggerate are really only superficial. They are to be expected in any administrative attempt to deal with a complex subject matter on a mass scale. Care must be taken not to permit their seeming complexity to confuse the elementary simplicity of the dealings between the parties.”
In any event the point cannot be of controlling importance, since we have now come quite completely to the point where we enforce justice and the law, notwithstanding possible deficiencies in presentation by the lawyers.
Consequently I must conclude that the procedure here does not require, but indeed makes anomalous, any further trial or delay in adjudication. The case is ripe for final settlement, which should now be had, of the jurisdiction issue. And any termination which does not follow the simple course stated in Sword Line and applied in American Eastern runs into serious difficulties, as resting upon a strained interprеtation of a written instrument. Here some note should be taken of our procedure. These cases were originally argued on January 15, 1957. The process of decision, particularly the rehearing in banc, has delayed action now for a year and a half, and the end is of course not yet in sight. I fear nothing has been achieved by the delay but the accentuation of our differences, with no progress toward their adjustment. Had the case been terminated by February 1957 by decision of the original panel, with a concise statement of our disagreement — a matter of interest, which the public is entitled to know — but without attempting the supposed, though illusory, reconciliation of views to be obtained by a hearing in banc, everyone, it seems, would have profited.
Hence I would affirm the decisions reached below by able district judges in accordance with views heretofore expressed by this court. I should add that of course I do not object to the dispositions made of certain libels not presenting the main issue. But as to this issue, since there would seem a distinct possibility of its going higher — in view of its great importance involving, inter alia, the premature and undefined overruling of previously settled precеdents — I do feel an obligation to mention the further question here definitely presented as to the effect of a vote by a judge retired from regular active service under 28 U.S. G. § 371(b) upon an appeal which has been ordered heard in banc. The question arises because the governing statute 28 U.S.C. § 46(c) says: “A court in banc shall consist of all active circuit judges of the circuit”; and Judge Medina, whose vote is here decisive, took advantage of the retirement provisions of 28 U.S.C. § 371(b) on March 1 last. I do not like to raise the question (which obviously can be settled only by the Supreme Court or by corrective legislation) because I have been active in inducing retired colleagues to sit and because I regard their continued participation in cases committed to their consideration desirable and beneficial all around. And I think this conclusion also applies to retired District Judge Leibell, who sat on the original panel herein which voted for affirmance. But the matter has caused doubt and uncertainty in other cases we have had, and a definitive answer is urgently desirable.
On Petition of Appellee for Further Rehearing en Banc
The United States, as appellee, attacks thе decision carried in our opinion of
It was on December 19, 1957 that we granted rehearing of our earlier decision before the court in banc. The court in banc comprised Chief Judge Clark, Judges Medina, Hincks, Waterman and Moore, all then active circuit judges. Judge Lumbard declined to sit with the court on the ground that he was disqualified by reason of earlier contacts with the cases below when serving as United States Attorney. The court in banc when thus constituted conformed in all respects to 28 U.S.C.A. § 46 (c) which provides: “A court in banc shall consist of all active judges of the circuit.” Since Judge Medina was a member of the court in banc which was duly constituted to hear and determine the issues raised by the petition for rehearing, we think his subsequent retirement did not affect his competence to participate in the decision thereafter reached. Nothing in the Code requires that the court of appeals when once constituted according to law, whether in banc or by assignment as an authorized division, shall suspend its judicial task and reconstitute itself either to exclude an active member of the court thereafter retiring or to include an active member of the court thereafter appointed. As the Reviser’s note indicates, § 46 was included in the Code of 1948 to preserve the interpretation established by Textile Mills Securities Corporation v. Commissioner of Internal Revenue,
Moreover, § 43(b) of the Code of 1948 provides: “Each court of appeals shall consist of the circuit judges of the circuit in active service. The circuit justice and justices or judges designated or assigned shall also be competent to sit as judges of the court.” This provision is not stated to be exclusive of the “judges designated or assigned” to hear and determine a case as members of a court in banc. The provision is as applicable to such judges as it is to judges designated and assigned to the divisions of' the court provided for in § 46(b) and to-judges designated and assigned under §§' 294 and 296. The provision thus lends further support to our conclusion that Judge Medina, who under § 46(c) was designated and assigned as a member of the court in banc was competent even-after his retirement to sit under §§ 43'. (b), 294(b) and 296.
The other claims of error raised in the-petition we think unfounded. They involve matters already carefully considered by us. And the requested' clarifications we think unnecessary and inappropriate. We havе reversed and' remanded for a determination of jurisdiction and, if jurisdiction be sustained, of the merits. We have made it plain-that these determinations should be made-without constraint by Sword Line, Inc. v. United States, 2 Cir.,
Petition denied.
Separate Statement of CLARK, Chief Judge, and WATERMAN, Circuit Judge.
Judge HINCKS’ opinion herewith demonstrates both the difficulty and the impracticability of interpreting the governing statute, 28 U.S.C. § 46(c), otherwise than by giving the word “determined” its normal meaning of “decided,” and the word “active” its natural force of “non-retired.” This view is underlined by the contrast drawn between judges “in active service” and “retired” judges, even though designated to sit, in the several statutes such as 28 U.S.C. §§ 294(b) and (d), 295, 296, and 371(b). It appears to be the general conclusion of other circuits. In re Sawyer, 9 Cir.,
. Sword Line, Inc., v. United States, 2 Cir.,
. Land v. Dollar,
. It is made by a minority only of the active judges, against the expressed view of other judges who may ultimately prevail. An overruling so deficiently based can only mislead the unwary.
. Some of the payments were actually made within the two-year limitation; while these are not separately noted in the opinion, they seem barred as voluntary payments.
. See, e. g., United States v. Bess,