Arthur v. The Cassius

| U.S. Circuit Court for the District of Massachusetts | Oct 15, 1841

STORY, Circuit Justice.

This cause has been- very fully argued upon the appeal. The merits of the whole controversy mainly turn upon the following points. 1. Whether there was in fact a final refusal on the part of the consignee at Velasco to receive the goods there. 2. If there was, whether the master had a right, under all the circumstances, to carry the same to New Orleans, and there to make sale of them on account of the shippers. 3. If the respondents fail, .on these points, to make out a satisfactory .defence in proof, whether, as owners of the •Cassius, they are responsible for damages to the libellants. 4. If they are so liable, what should be the rule and measure of the damages.

In respect to the liability of the owners of the Cassius, (who have intervened for their own interest,) in this suit, I have no difficulty. The charter-party is in no just sense a mere personal contract of the master. It contains an express stipulation, pledging not ■only the personal security of the master, but also the Cassius and her freight and appurtenances. for the due fulfilment of the covenants of the charter-party on his side. Now, if the master was, as the owners of •the Cassius by their answer assert, owner for the voyage, under a special agreement with them. I do not perceive why he is not to be deemed so for all purposes whatsoever, and to have a perfect right as such owner to pledge the Cassius for the due fulfilment of the charter-party. If, on the other hand, the general owners were owners for the voyage, •as I am of opinion upon their own statement of their agreement with the master, they ought to be held to be, then the Cassius is liable upon the charter-party, which is not .denied to have been only authorized to be made for the voyage therein stated. What •was that agreement, as stated in the answers both of the master and the owners? That the master “should employ and navigate the Cassius, and victual and man her, and should be entitled to retain as his compensation therefor, and for his own services as master, one half of the freight, which should be earned by the Cassius, and he was to pay the other half of the freight to the •owners of the said schooner.” The owners, then, were, upon acknowledged principles of law, jointly interested with the master in the freight; and jointly responsible with the master to the shippers, as partners or part •owners in the freight and profits of the voyage (the gross freight); or he was to receive the half freight in lieu of and as a compensation for his services as master, and then the owners were directly liable as owners for the •voyage; as well as general owners. In either view, the case would fall within the principles applicable to the jurisdiction of courts of admiralty by proceedings in rem upor charter parties, which were recognized i) the case of The Volunteer, [Case No. 16,991, with which I have not since seen any reasoi to be dissatisfied. The case of Taggard v Loring, 16 Mass. 336" court="Mass." date_filed="1820-03-15" href="https://app.midpage.ai/document/taggard-v-loring-6404896?utm_source=webapp" opinion_id="6404896">16 Mass. 336, has been cited at the bar as establishing, that the master was owner for the voyage. That ease is distinguishable in its actual circumstances from the present. The agreement in that case does not appear from the statements of the Report to have been identical with the present. And if it were, I must say, that I should have some difficulty in acceding to the authority of that case, if it meant to establish, that the master had an exclusive special ownership in ihe ship for the voyage. I should rather incline to the opinion, that if he had any ownership at all for the voyage, it was in common with the general owners. In the present case there does not appear to be any distinct proof of what the agreement between the owners and master was. None is produced in writing, and none is established in the testimony. It rests wholly upon the answers of the owners and master, whose statements on such a point, even if responsive to the allegations of the libel, (which they are not,) would not of themselves, in a court of admiralty,’ be satisfactory evidence. Besides, there is this additional consideration,, that the charter-party, in this very ease, was executed by the master in his character as master, and not as charterer and owner for the voyage. The respondents have admitted, in effect, that he was entitled, to make the charter-party; and they held him out to the public, from the nature of this employment as a freighting vessel, as having general authority to bind the owners on a freighting voyage. The secret agreement, therefore, between the master and the owners, as to the shares of the freight between them, or the rights of the master in the navigation and control of the vessel, cannot, as they were not made known to the charterers, bind them, or vary their rights against the general owners. This objection, therefore, in every view is unmaintainable.

Then as to the merits of the case. In the first place, was there any absolute, positive, and final refusal of the consignee to receive the cargo? There certainly is something in the conduct and management both of the master and the consignee in respect to then-proceedings at the port of Velasco, which is exceedingly suspicious and mysterious, not to say, which gives rise to great doubts, whether there was not some connivance between them for purposes adverse to the interests of the charterers, on whose account the shipment was made. . It has been suggested at the argument, that the consignee was, or at least might fairly be presumed to be, the real owner of the shipment. I see no sufficient foundation for such a suggestion in the facts of the case.' It is repugnant to the apparent objects and intentions of the charter-party; and if the consignee had been the intended shipper in the original enterprise, it is inconceivable, why he was not made a direct party to the charter-party. His conduct at Velasco, while it may furnish some reason to doubt (if the evidence is believed) his good faith to the charterers and shippers, cannot be admitted to control their rights or change their property without their knowledge and adoption of all his conduct. It is said, that he might have been made a witness in the cause on the part of the libel-lants. Perhaps he might, but certainly not without a release, which, if he has sacrificed their interests, they would be very unwise to give. On the other hand, the respondents could have used him as a witness without a release; and if they meant to rely upon his being the owner of the shipment, it was their own fault not to take it, or to exhibit other proofs of the fact, since it is properly a mat-rer of defence to the suit.

Tlye conduct of the master in signing two protests, each of which was false in its statements, as he in his answer on oath now admits, is utterly without excuse. It was -done in connivance with the consignee, under the pretence on his side, (as his letter to the master shows), that- the landing of the •cargo was either impracticable, or so dangerous and expensive, that the whole might be abandoned to the underwriters, and thus the loss thrown on them; when in point of fact, as all the evidence now in the case conclusively shows, the landing might have been effected without danger or difficulty. These protests were drawn up and signed by the master for the purpose of giving this very gloss to the transaction. Neither of these protests alludes in the slightest manner to the refusal of the consignee to receive the cargo. On the contrary, both of these protests, as well as the letter of the consignee, put the case upon the other ground. But I cannot but entertain some suspicion, founded upon the positive evidence in the ease, that another motive had its operation upon the mind of the consignee, that is, a desire to have the cargo landed and sold by the master at auction on account of the underwriters, so that it might be bought in at a low price for his own benefit. Be this as it may, for such has been the conduct of these parties that I cannot judicially repose confidence in their acts or statements, if <3apt. Hendley is to be believed (and I do not well know what reason to assign why he should not) it is certain that the consignee did subsequently offer to receive the cargo and comply with the charter-party, nay, did require that the cargo should be landed, and the master refused to land it, alleging the dangerous situation of his vessel and the extreme difficulty, if not impracticability, of so doing. Now, even if the consignee did at first refuse to receive the cargo; yet, if before the departure of the Cassius from the port he was willing and ready to receive it, it was the duty of the ’master to proceed and land it. If he could have landed it (of which there is now no doubt) and he did not, it was a plain breach of the contract. It was an idle pretence to suggest that the cargo could not be sold at Velasco for the want of sufficient money to be had to pay for the same. That was nothing to the master. The freight was not payable in money at Velasco, but was payable by a bill to be drawn by the consignee on New York. It was, therefore, wholly immaterial to the master whether the cargo could be sold at Velasco or not. In this view of the case there was a clear breach of the charter-party by the master, in the non-delivery of the cargo at Velasco.

But, suppose, in the next place, there was a final refusal to receive the cargo by the consignee, did that authorize the master to carry it to New Orleans ? The learned counsel for the respondents has insisted, at the argument, that it did. I agree, that in cases of necessity, the master becomes, by mere intendment and authority of law, the agent of all concerned, as well of the owners of the cargo, as of the ship — ut res magis valeat quam pereat. But this right of the master is to be clearly made out by unquestionable proof of such necessity. In the present case, the cargo could have been landed at Velasco, which was the port of destination. Then there was no necessity of carrying it elsewhere. It is said, that it could not have been sold at Velasco, for want of money in the hands of purchasers. Be it so. But there was no necessity of any sale; the cargo was not perishable; and, therefore, the sale would have been unjustifiable on the part of the master; since it would not have been a sale of necessity. The cargo might have been landed and stored, and kept until the charterers at New York could have received information, and given orders as to what should be done with it. But it is said, that the master was not bound to give up the cargo before his freight was paid or secured according to the charter-party; and that he had a right to retain it for the lien created by law. Assuming, that such a lien existed under the terms of the present charter-party, still it is perfectly clear, by the language of the same instrument, that the freight was payable only “on delivery of the cargo at the port of Velasco,” and “that no freight was to be paid on such part of the cargo, if any, as may be lost in rafting the same on shore.” So that until a right delivery on shore, no freight could accrue duo. If the consignee refused to receive the cargo after it was landed, and to give the bill on New York for the freight, then it became the duty of the master to place the same in the hands of some trustworthy person for the security of his lien for the ¿eight, and, subject thereto, for the benefit and account of the owners. But no right, even under such circumstances, could exist on tlie part 'of the master to sell the cargo, unless it was perishable, and might otherwise have been lost or have perished, which is not proved or pretended by the answer. A fortiori, if the master had no right to sell at Velasco, because there was no necessity therefor, he could not have a right to carry the cargo to New Orleans and sell it there; since it is just as clear that there was no necessity therefor. This act, therefore, in carrying it to New Orleans, was a gross breach of his duty, and the sale a tortious conversion of the property. It might, perhaps, have admitted of a very different construction, if the cargo could not have been landed at Velasco, or there deposited in safety for the owners; or if the sale at Velasco or at New Orleans had become indispensable from the perishable nature and condition thereof. Such a case has not been made out; and, therefore, it need not be decided upon the present occasion.

It appears to me, therefore, clear that the non-landing of the cargo at Velasco, and the carrying of the cargo to New Orleans, and the sale thereof in that port, are all breaches of duty on the part of the master, for which the respondents are liable.

Tlie only remaining question is as to the rule and measure of damages. It appears to me, that, as the cargo safely arrived at Velasco, and might have been landed there, but for the misconduct of the master, the libellants are entitled to recover the actual value thereof at Velasco, at the time when the same might have been there landed, deducting all duties and charges, and the freight for the voyage, as if the cargo had been duly landed. ■ It is said that no freight was due, because there was no delivery thereof. That is true. But still the cargo was carried there, and if it had been rightly delivered there, the freight would have constituted a charge upon the value in that port. So that, if -the libellants are to take the value there, as I think is the true rule, they are to be, as to that value, in the same state and condition as if the cargo had been duly landed, and not in a better state and condition. The rule, adopted in cases of prize, of ten per cent, upon the prime cost, is not applicable to cases like the present. That rule ordinarily supposes, that the vessel has been captured, before she has arrived at the port of destination, and then the court in. odium spoliatoris will presume the cargo worth more at the port of destination than, the prime cost by ten per cent.; which used to be the old rule of estimating the fair and reasonable profits in ordinary cases, after-deducting all charges. But where the vessel actually arrives at the port of destination, in cases like the present, the loss, if any, is susceptible of a more exact computation, by its true and real market value-there.

I shall, therefore, refer it to an assessor,, to ascertain the value of the cargo at Velas-co, deducting the freight and duties, and all other proper charges; and the libellants will be entitled to recover the difference, as the true amount of their loss, with costs., The decree of the district court is, therefore, reversed; and the final decree will be entered according to this opinion.

As the master has died pending the proceedings, and no revivor of the suit, as to. him, has been moved for, it is unnecessary-to consider whether a proceeding in rem and in personam can be instituted in the admiralty in a case of this sort. The libel must be-treated as defunct, so far as the master is. concerned.