The Wright
Pursuant to the direction of this court in The Papoose, 2 Cir., 85 F.2d 54, reversing D.C.E.D.N.Y., 12 F.Supp. 743, certiorari denied 299 U.S. 603, 57 S.Ct. 230, 81 L.Ed. 445, the District Court entered its final decree in this cоnsolidated cause dividing the damages resulting from a collision on May 2, 1931, of the U.S.S. “Wright” and the S.S. “Papoose” owned by Petroleum Navigation Company. The Navigation Company now appeals becаuse the decree awarded the United States interest on the latter‘s damage prior to the date of the entry, but denied like interest to appellant.
Since the respective damages tо the vessels, as fixed by stipulation, showed that the “Papoose” sustained a greater damage than the “Wright” by about $6,600, appellant would have been entitled to a recovery of $3,300 if interest and cоsts had been excluded from the calculation. But the District Court, by awarding interest of $9,339.66 to the United States, made the latter‘s claim greater than that of appellant. Since appellant recovered more costs, it finally found itself with a favorable decree, but only for $371.64. It complains of this inequitable result, urges that justice should be equal to all, and claims that interest should be either granted or denied to both parties alike. Normally, equality is the ideal of Anglo-Saxon law, but, as the District Court held, it does not apply to the sovereign who may claim as of right while granting only by favor. United States v. Verdier, 164 U.S. 213, 218, 17 S.Ct. 42, 41 L.Ed. 407; United States v. North American Transportation & Trading Co., 253 U.S. 330, 336, 40 S.Ct. 518, 64 L.Ed. 935. But such a rulе may properly be confined to cases of “plain compulsion of law.” American Propeller & Mfg. Co. v. United States, 300 U.S. 475, 478, 57 S.Ct. 521, 523, 81 L.Ed. 756. With the District Court we see no escape from the rule so far as concerns interest against the Unitеd States prior to final decree; but we do not agree that at the same time interest must be awarded to the United States. If, as Mr. Justice Holmes said in United States v. The Thekla, 266 U.S. 328, 340, 45 S.Ct. 112, 113, 69 L.Ed. 313, “the subject matter” of the crоss-libels “is the collision, rather than the vessel first libelled,” and the government‘s libel “is like a bill for an account, which imports an offer to pay the balance if it should turn out against the party bringing the bill,” then that balance should not be made a loss to the claimant merely upon the passage of time and by the device of a unilateral grant of interest.
Without statutory authority no libel can be instituted against the United Stаtes or its vessel for damages caused by the negligent operation of the vessel. The Western Maid, 257 U.S. 419, 42 S.Ct. 159, 66 L.Ed. 299.1 But when the United States libeled a private vessel, this was held to constitute permission for a cross-libel by the vessel оwner and to justify the award of interest in favor of such owner if the latter‘s claim was sustained. United States v. The Thekla, supra.
Moreover, many special acts were passed, authorizing the filing of libels against the United States for partiсular collisions. Some of these contained express provisions as to interest (compare 278 U.S. 41, at page 44, 49 S.Ct. 52, 73 L.Ed. 170), but most referred only generally to the award of “damages.” This court construed such statutes to inсlude interest as a part of the damages. Texas Co. v. United States, 2 Cir., 16 F.2d 948, certiorari denied 274 U.S. 752, 47 S.Ct. 765, 71 L.Ed. 1332; New York & Cuba Mail S. S. Co. v. United States, 2 Cir., 16 F.2d 945, certiorari denied 274 U.S. 753, 47 S.Ct. 765, 71 L.Ed. 1333. But the Supreme Court took the case of Boston Sand & Gravel Co. v. United States, 1 Cir., 19 F.2d 744, because of conflict with the cases just cited and, in an opinion by Mr. Justice Holmes (four justices dissenting), concluded that such an act did not authorize interest against the
By the Shipping Act of 1916,
Governmental responsibility for public vessels did not come until the Public Vessels Act of 1925,
Whatever may have been the previous rule under The Thekla, supra, we think with the court below that the Public Vessels Act applied to all claims against the United States for damages caused by public vessels, whether by libel or by cross-libel. Authority for cross-libels against the government is now to be found in the Act, and Section 2 limits the award of interest on any claim for public vessel damage. This important right cannot depend upon which of the two parties involved — governmеnt or private claimant — is able first to rush into the admiralty court. The “Wright” was a public vessel.
But so far as concerns the award of interest in favor of the United States, the authorities do not compel thе result reached below. The general language of Boston Sand & Gravel Co. v. United States, supra, states only the admitted principle that the United States may still claim interest on its awards, though the converse is prevented by the Public Vessels Act. It did nоt deal with our present case of awards to both parties, with a resulting balance against the government. Other precedents, however, support the power of the admiralty court to withhold interest under circumstances analogous to those presented here.
Sevеral cases deny the award of interest prior to decree to either party where damages are divided as a result of joint fault. This is based on the uncertainty as to the party which will have the ultimаte liability to make payment on determination of the balance due. Kawasaki Zosensho v. Cosulich Societa Triestina di Navigazione, 5 Cir., 11 F.2d 836, 838, certiorari denied 265 U.S. 581, 44 S.Ct. 456, 68 L.Ed. 1190; The Itasca, D.C.S.D.Ga., 117 F. 885, 892; The Tremont, D.C.W.D.Wash., 160 F. 1016, 1021, affirmed 9 Cir., 161 F. 1. District Judge Adams said in an early case, however, that such was not the rule of the Second Circuit, and that interest must be allowed at least from the date of making disbursements. Adams, D.J., in The Mahanoy, D.C.S.D.N.Y., 127 F. 773, citing The Baltic, D.C.S.D.N.Y., Fed.Cas.No. 824, 3 Ben. 195; Cf. 20 Va.L.Rev. 369. In The Manhattan, 3 Cir., 85 F.2d 427, certiorari denied 300 U.S. 654, 57 S.Ct. 432, 81 L.Ed. 864, the award of interest to the United States only from the time of making disbursements was approved over the government‘s protest, on the ground that interest was discretionary and was but an element of the damages designed only to make the injured party whole. We think the precedents in the casеs of awards for joint fault justify their treatment as exceptional circumstances.
If, as seems reasonable, interest should be withheld in collision cases between private vessels until it can be found which party is withholding a balance due, then all the more should interest be denied the United States where it was the party liable for a balance and where there was never a withholding by the appellant herein. The suggestion of Mr. Justice Holmes in The Thekla, supra, that the situation is analogous to stating an account for the collision, with an order for the payment of the balance due, seems sound. Here that paymеnt was due from the United States. The Public Vessels Act forbids the award of any interest against the United States until final decree, even though it may have owed that balance. Consequently, until that decree no interest is payable.
The decree is reversed, with directions to deny all interest to the parties prior to the final decree.