LAKE TANKERS CORP. v. HENN, ADMINISTRATRIX.
No. 445
Supreme Court of the United States
Argued May 6, 1957. - Decided June 10, 1957.
354 U.S. 147
Frank C. Mason argued the cause and filed a brief for respondent.
MR. JUSTICE CLARK delivered the opinion of the Court.
This admiralty limitation proceeding resulted from a maritime disaster in 1954. The aggregate amount of all of the claims filed in the proceeding and for which the petitioner could be held liable if found at fault is less than the value of petitioner‘s vessels and their pending freight. The question presented is whether the respondent, the principal claimant, may, under these circumstances, proceed with her action in a state court, subject to the continuing jurisdiction of the federal court to protect petitioner‘s right to limited liability, to determine the obligation of the petitioner to respond in damages for the loss of the life of her husband. We agree with the disposition of the District Court as modified by the Court of Appeals.
Respondent‘s husband was a passenger on the pleasure yacht, Blackstone, which was involved in a collision on the Hudson River on July 10, 1954, with petitioner‘s tug, Eastern Cities, push-towing petitioner‘s barge, L. T. C. No. 38. The Blackstone capsized and respondent‘s husband was drowned. The other 10 persons on board the yacht were rescued. Respondent, as her husband‘s administratrix, brought suit against the petitioner in a New York state court claiming $500,000 damages for the loss of her husband‘s life. She alleged that the loss was caused by Lake Tankers’ negligent operation of both its tug and its barge. Actions by four other claimants were also commenced in the New York state courts against the petitioner for damages for personal injuries and for loss of the Blackstone.
After petitioner instituted the limitation proceeding the respondent filed a claim for $250,000 in it covering the same loss asserted in her state court case. The 10 survivors, including those who had filed suits in the state court, also filed their claims in the limitation proceeding. These totaled only $9,525. All of the claimants, including respondent, have relinquished all right to any damage in excess of the amounts set forth in their respective claims in the limitation proceeding and expressly limited their recovery to those amounts. The respondent has amended her claim further by allocating $100,000 of her alleged damage to the tug and the remaining $150,000 to the barge. She has also filed stipulations agreeing neither to increase these claims, nor to enter into a judgment in excess of these amounts, and she has waived any claim of res judicata relative to the issue of the petitioner‘s right to limit liability if that issue should be passed on in the state court proceeding. The District Court on application then vacated the restraining order since the total fund exceeded the amount of the claims.
“If claimant obtains a judgment in her state court suit for an amount in excess of $100,000, an injunction will issue permanently enjoining her from collecting such excess unless the judgment rests on a special verdict allocating the amount as between the libelant as owner of the tug and as owner of the barge respectively. Thus if the judgment exceeds $100,000 and the jury finds libelant liable solely as owner of the tug, she will be enjoined from collecting any excess. If the jury finds that the libelant is liable solely as owner of the barge, she will be enjoined from collecting any amount in excess of $150,000.” 232 F. 2d 573, 577.
On rehearing the Second Circuit, sitting en banc, reaffirmed its decision. 235 F. 2d 783. We granted certiorari to pass upon the important jurisdictional question presented. 352 U. S. 914.
This Court has recently considered the cases which discuss the historical background of the Limited Liability Act,
“The succeeding sections are in the nature of an appendix and relate to the proceedings by which the first is to be made effective. Therefore, they should be so construed as to bring them into correspondence with it.”
Among these sections dealing with the mechanics of effecting such limitation of liability is
On the other hand, where the value of the vessel and the pending freight, the fund paid into the proceeding by the offending owner, exceeds the claims made against it, there is no necessity for the maintenance of the concourse. This is not to say that concursus is not available where a vessel owner in good faith believes the fund inadequate, but here there is no contention that there might be further claims; the value of the vessels is undisputed and the claims are fixed; it follows indubitably that the fund is sufficient to pay all claims in full. While it is true that the claims as initially filed in the state court exceeded the fund created in the limitation proceeding, still when the admiralty court dissolved the injunction against the state suit these claims, as filed in and limited by stipulation and order of the admiralty court in the limitation proceeding, aggregated less than the fund. On appeal the Court of Appeals placed even more severe restrictions on the state court prosecution, thus insuring beyond doubt that petitioner‘s right of limitation under the Act was fully protected.
For us to expand the jurisdictional provisions of the Act to prevent respondent from now proceeding in her state case would transform the Act from a protective instrument to an offensive weapon by which the shipowner could deprive suitors of their common-law rights, even where the limitation fund is known to be more than adequate to satisfy all demands upon it. The shipowner‘s right to limit liability is not so boundless. The Act is not one of immunity from liability but of limitation of it and we read no other privilege for the shipowner into its language over and above that granting him limited
The state proceeding could have no possible effect on the petitioner‘s claim for limited liability in the admiralty court and the provisions of the Act, therefore, do not control. Langnes v. Green, 282 U. S. 531, 539-540 (1931). It follows that there can be no reason why a shipowner, under such conditions, should be treated any more favorably than an airline, bus, or railroad company. None of them can force a damage claimant to trial without a jury. They, too, must suffer a multiplicity of suits. Likewise, the shipowner, so long as his claim of limited liability is not jeopardized, is subject to all common-law remedies available against other parties in damage actions. The Act, as we have said, was not adopted to insulate shipowners from liability but merely to limit it to the value of the vessel and the pending freight. It is contended that Maryland Casualty Co. v. Cushing, 347 U. S. 409 (1954), is to the contrary. While there was no opin-
We conclude that in the situation here a concursus beyond that required by the orders heretofore entered in this case is not necessary and respondent may therefore proceed with her state court suit.
Affirmed.
MR. JUSTICE WHITTAKER took no part in the consideration or decision of this case.
MR. JUSTICE HARLAN, whom MR. JUSTICE FRANKFURTER and MR. JUSTICE BURTON join, dissenting.
I agree with the result reached by Judge Hincks in his dissenting opinion below, 232 F. 2d 573, 579, and think that this judgment should be reversed. Since federal limitation jurisdiction was properly invoked, we should not permit it to be aborted by subsequent actions by the claimants with a view to obtaining transfer of the trial of their claims to the state courts. At the time the limitation proceeding was commenced the total claims which had been asserted in the several state court actions far exceeded the value of both the vessels owned by the petitioner, and limitation proceedings were required.