Coburn v. Factors & Traders Ins.

| U.S. Circuit Court for the District of Eastern Louisiana | Apr 15, 1884

Pardee, J.

After much deliberation in this ease I have concluded that it makes very little, if any, difference whether the respondent companies were stockholders, incorporators, or copartners in the Harbor Protection Company. In either case they were beyond their rights and powers under the scope and effect of their charters as insurance companies, and what they have done has been ultra vires. But the view I take of the case renders it unnecessary to determine the responsibilities devolving on them by reason of their connection with the Harbor Protection Company, but for the case concede them to be as claimed by libelant. Nor is it necessary to consider as to the legal force and effect of the employment of libelant by the Harbor Protection Company, and the several agreements by and between libelant and the same company. Neither the Harbor Protection Company nor the respondents owe the libelant by reason of any salvage services rendered to or for them. The case is that the Protection Company, in the first instance, and the respondent in the second, had received moneys for salvage services, which, in law and in fact, belonged to the officers and crew of the tug-boat on which libelant was employed, and a share of which money belonged to him. It maybe assumed, and perhaps correctly assumed, that libelant, as master of the tug-boat earning the salvage collected by the Harbor Protection Company owners, was entitled to his share of the same, as claimed in the libel, and that he never has legally waived or abandoned his right to sue for and collect the same. As the respondents did not owe libelant this money, they cannot be held liable for it beyond the responsibility devolving on them as copartners or stockholders in the Harbor Protection Company, and that which they incurred when they received the money, or part of it, from the Harbor Protection Company. In short, the demand libelant has in this is one for money had and received, either by the Protection Company, for which respondents may be said to be liable, or by the respondents themselves. ‘Che case shows that the Harbor Protection Company, owners of the salving tugs, from December, 1871, to March, 1876, received large amounts, say $74,723.48, of salvage, a portion of which belonged to the libelant as master; that whatever was done with the said salvage money by the Protection Company, only the sum of $2,144 thereof was turned over to the Home Insurance Company, and only the sum of $3,863.20 thereof was turned over to the Factors’ & Traders’ Insurance Company. The case further shows that these sums were turned over in December, 1873, since which time libelant’s claims have been exigible; and that while libelant has stood by, pretending no claim, rather renouncing any claim, other persons having claims against these funds on the same account of salvage, have, by suits instituted in the admiralty court from time to time, recovered from respondents as salvage moneys more than the original amounts received by respondents, to-wit, from Home Insurance Company the sum of $2,253.42, and from Factors’ & Traders’ Insurance Company the sum of $3,939.50.

And this brings "me to what I consider as certainly a meritorious defense to the libelant’s demand, i. e., staleness of demand. The sum claimed by libelant was earned nearly all prior to December, 1873, only a small portion having been earned thereafter to March, 1876. In December, 1873, the respondents received the salvage money that furnishes ground for liability in this case. This suit was instituted March 6,1883, so that for over nine years the libelant made no claim, nor pretended any.' In fact, the evidence in the case shows that during nearly all of the nine years, both by actions and words, libelant repudiated and renounced any and all claims. His justification for his silence and for his epnduct is that if he had spoken he would have lost his employment. As against his employers this is a very strong excuse; and I believe that heretofore in this court it has been held sufficient, but only in cases against employers, and where the substantial rights of the parties had undergone no change. Sonderberg Towboat Co. by Justice Bradley, 3 Woods, 146" court="None" date_filed="1878-04-15" href="https://app.midpage.ai/document/sonderburg-v-ocean-tow-boat-co-8637296?utm_source=webapp" opinion_id="8637296">3 Woods, 146; Averill v. Yorke, by Judge Pardee, (not reported;) Cohen, Adm. 164. Here the case is entirely different. Even conceding that the respondents stood to the libelant in the relation of employers, and still the rights and position of respondents has been materially changed, while the libelant has stood idly by, making no claim.

In the Sonderberg Case, supra, Justice Bradley said:

“ I do not see that an action in personam, such as this is, against those who have received and still hold moneys fairly belonging to the libelants, can be said to be a stale demand, in the admiralty sense, by means of any lapse of time (two years) which has taken place in this case. ”

And in the case of Averill v. Yorke, supra, it was said:

“And where the salvage money was withheld by the owners, and certain of the salving crew remained in the employ of the ship-owners without making claim to their share of the salving money for fear of discharge and loss of employment, such an apprehension was a sufficient reason for not prosecuting their claim sooner; and where under such circumstances the claim is not prosecuted for over a period of nine years, a plea of staleness of demand constitutes no defense.” • . ■ ■

In these cases I think that this court has gone to the verge of reason and equity in relieving parties who have slept upon their rights, but in each it will be observed that a potent factor was that the delay had not been injurious to the respondent. The circumstances had not changed. The party still held the money. Here the case is very different. The Harbor Protection Company deceased in 1876. Its assets were divided. Some of its partners or stockholders have become insolvent. One of the respondents here is liable, if at all, only as the purchaser and successor of one of the partners or stockholders. The respondents have paid out on similar claims to libelants more than they received of salvage money. Whether a claim will be held stale in admiralty does not depend so much upon lapse of time-as upon change of circumstances affecting the rights and conditions of parties. Three months’ time may render a claim stale, as where a lienholder has stood by and permitted a ship to pass into the hands of innocent purchasers, while perhaps three years would not be sufficient without change of ownership. Here both lapse of time and change of condition are factors, and I think it would be inequitable to hold the respondents liable, and this particularly in view of the fact that libelant has not simply remained silent as to his demands, but has openly, notoriously, and in writing renounced and denied his claims.

The assignment of May o, 1879, may or not be valid as a transfer of libelant’s claim for salvage in favor of the New Harbor Protection Company, but in favor of these respondents it should certainly have effect as an estoppel. And the same may bo said as to the other acts and conduct of the libelant.

A decree will be entered dismissing the libel, with costs of both this and the district court.