244 F. 80 | 2d Cir. | 1917
December 5, 1914, the steamer Oceana, while in their yard for overhauling, was sold by the owners, the Morse Dry Dock & Repair Company, to the Bermuda American Steamship Company, Limited. In accordance with the agreement of sale the bill of sale was deposited in escrow in the Columbia Trust Company, to be delivered only upon performance by the vendee of certain of the covenants in the agreement. It never was delivered, because the vessel was retaken by the Morse Company on account of the failure of the vendee to perform these covenants.
Between December 10, 1914, and March 8, 1915, a large amount of repairs, supplies, and other necessaries were furnished on the order of the Bermuda Company, although title was in the Morse Company by bills of sale duly recorded in the United States custom house for the port of New York, which was the home port of the vessel.
“(5) Until said ship is completely paid for, the purchaser covenants as follows:
"(a) To keep said ship clear of any liens from any cause, and If any lien or libel is filed or asserted, the same shall be immediately bonded by -the purchaser. The purchaser agrees to promptly pay current bills for supplies and repairs to said ship, and exhibit at reasonable times the ship’s accounts and bills to seller’s representatives.”
The libelants contend that this provision as to bonding is an authority to the vendee to create liens; but we regard it, on the contrary, as a prohibition added out of abundant caution.
On and after December 10th, while the vessel was still in the vendor’s yard, the vendee was allowed by the vendor to take possession and fit her out at a cost of some $12,000, but she was not actually delivered to the vendee and removed from the yard until December 25tli.
Sixty-nine different libels have been filed against the steamer in resn, which were consolidated in the present suit; the Morse Company, claimant, giving a stipulation in the sum of $100,000 to pay all awards to the libelants, with costs. Judge Veeder referred the claims to James K. Symmers, Esq., as special commissioner, who sustained the claims
- He disallowed claims of certain of the libelants on the ground that they had notice sufficient to put them on inquiry as to the nature of the Bermuda Company’s interest in the vessel. The District Judge sustained exceptions to the commissioner’s finding that there could be no lien for repairs and supplies furnished before December 25, 1914. Evidently by inadvertence he included in this category the claim of the W. & A. Fletcher Co., $173.27 of which was disallowed by the commissioner for a different reason, viz., that they were for articles furnished, not to the steamer, but to the pier.
The Morse Company, claimant, has assigned error to the decree in allowing any of the claims, and Kniffin & Demarest Company have assigned error for dismissing their libel. The sole question is whether the court has rightly applied the act of Congress of June 23, 1910, the applicable sections of which are:
“1. Any person furnishing repairs, supplies, or other necessaries, including the use of dry dock or marine railway, to a vessel, whether foreign or domestic, upon the order of the owner or owners of such vessel, or of a. person by him or them authorized, shall have a maritime lien on the vessel which may be enforced by a proceeding in rem, and it shall not he necessary to allege or prove that credit was given to the vessel.
“2. The following persons shall be presumed to have authority from the owner or owners to procure repairs, supplies, and other necessaries for the vessel: The managing owner, ship’s husband, master, or any person to whom the management of the vessel at the port of supply is intrusted. No person tortiously or unlawfully in possession or charge of a vessel shall have authority to bind the vessel.
“3. The officers and agents of a vessel specified in section 2 shall be taken to include such officers and agents when appointed by a charterer, by an owner pro hac vice, or by an agreed purchaser in possession of the vessel, but nothing in this act shall be construed to confer a lien when the fur-nisher knew, or by the exercise of reasonable diligence could have ascertained, that because of the terms of a charter party, agreement for sale of the vessel, or for any other reason, the person ordering the repairs, supplies, or other necessaries was without authority to bind the vessel therefor.”
Obviously the act was passed in restriction of the rights of vessel owners and in the aid of those who furnish repairs, supplies, and other necessaries. It wiped out all difference between foreign and domestic vessels, and between repairs, supplies, and other necessaries furnished in 'the home port, as distinguished from those furnished in foreign ports, and between such as were ordered by the master and such as were ordered by the owners. It created a presumption of law of the vessel’s liability for all repairs, supplies, and other necessaries ordered by the master, managing owner, ship’s husband, charterer, any person to whom the management of the vessel is intrusted at the port of supply, owner pro hac vice, and conditional vendee. There is an exception in favor of the vessel owner, relied upon by the claimant in this suit, in the case of repairs, supplies, or other necessaries ordered by a charterer or conditional vendee, who has no. authority to bind the vessel, provided the repair and supply men knew, or ought with reasonable
The claimant puts great stress on the decision of the Supreme Court in The Valencia, 165 U. S. 264, 17 Sup. Ct. 323, 41 L. Ed. 710, made long before the passage of the act of 1910. It is not applicable. In that case the least inquiry would have disclosed the fact that the company operating the steadier was a charterer bound to pay for coal; but the libelant supplied coal, not on the order of the master, but of the company, without making any inquiry whatever. If he relied for his lien upon the New York statute, we have held that it would be necessary for him to prove that he gave credit to the vessel. The Electron, 74 Fed. 689, 21 C. C. A. 12. This he could not do.
The decree, modified by making the claim of the W. & A. Fletcher Company $17.70, with interest from January 30, 1915, is affirmed, with interest and costs; the latter only to those appellees who have filed briefs.