ADM.] JAMES KENNEDY AND ANOTHER v. WILLIAM E. DODGE AND ANOTHER. had been received on account of the testator's estate since his decease in respect of the voyages on which the ships were engaged at the time of his death, after deducting the amount of all the expenses incurred, whether before or after his decease, in respect of such voyages; and deducting the amount of the losses on those ships which had incurred losses from the profit and gains made by the others. Minutes to be prepared on the footing of this decision. Solicitors: Baker, Nairne, and Oxley; Farrer, Ouvry, and Co.; Fox. [ADM. 1. That the ship arrived at this port about the 11th Aug. 1866, with a general cargo, including the tinplate and iron rods mentioned in the bill of lading, and also a considerable quantity of pig-iron and other freight for other parties. 2. That on the application of the ship the harbour master assigned her a berth at pier No. 45, East River, which she took and proceeded to unload her cargo, which she continued to do for several days. 3. That the pier was a good one, with sufficient strength to have supported the cargo had it been properly placed thereon. 4. That as the cargo was discharged from time to time, the resps. had notice of the landing of that part of it which belonged to them, and took portions UNITED STATES DISTRICT COURT- of it from time to time to their warehouses as was IN ADMIRALTY. Reported by R. D. BENEDICT, Proctor and Advocate. SOUTHERN DISTRICT OF NEW YORK. Bill of lading-Damage to cargo-Negligence in dis- Held, that landing goods at a proper time and upon a This was The answer admitted that the goods were shipped as stated, and their arrival at New York. But it averred that they were not delivered in good order; that, on the contrary, the cargo of the ship was discharged in such an unskilful and negligent manner that the dock on which it was placed broke down, and 313 boxes of the tin plate were precipitated into the river and greatly damaged; that the resps. were at great expense in recovering them, which, with the injury to the plates in being immersed in the water, amounted to more than the freight money sued for. The resps. asked to recoup and set off this damage and expense, to the extent of the libelants' claim for freight, and recover the balance. The following were the facts proved, as found by the court: convenient. 5. That before they had removed it all, the ship had so overloaded the bridge of the dock with other cargo, and especially with the iron, that it gave way, and precipitated a portion of the resps.' goods into the river. 6. That the goods were thereby damaged, and the resps. incurred expense in recovering them from the water. 7. That by a standing agreement between the ship or her owners and the resp., when the latter had goods on the dock, landed from ships owned by the libelants, and such goods remained on the dock over night, the master or agent of the ship was to employ a night watchman to watch the goods, at the expense of the resps., and that they did so in this case. SHIPMAN, J.-It is insisted by the libelants that these goods were delivered to the resps. when they were placed on the dock with notice to them, and were, consequently, at their risk thereafter. With regard to cargoes arriving at this port under ordinary bills of lading from foreign countries, landing them at a proper time and upon a proper dock, with notice to the owers, is equivalent to a delivery. After such landing and notice the owner takes all the risks arising from every other cause except that which proceeds from the ship itself. The parties to this suit evidently recognised this rule of law, when the watchman was employed at the expense of the resps. to watch this tin during the night-time. Had this tin been stolen, of the officers or agents of the ship, or damaged by or removed by other parties without the intervention the elements, the ship could not have been made responsible. But this does not meet the question before the court. The clear proof is that the pier was broken down by the weight of the iron placed upon it by direction of the master. He, and not the resps., selected the dock, and he broke it down. The fact that the resps. did not instantly remove their goods on being landed is no answer The notice to them was not a notice against the wrongful and destructive acts of the ship in discharging the rest of her cargo, nor against a defective pier. The master had no more right to break the dock down and precipitate this tin into the water, than he would have had to pile his iron on crates of crockery and crush them. I attribute to him no intention to injure the pier or the resps.' goods. I am speaking of the legal, not the moral quality of his acts. He doubtless thought the dock would support the load he was placing upon it, but the result proved that he was mistaken. The consequences of that mistake are not to fall on the owners of the cargo, when they had no agency in causing it. The only doubt I have felt in the case is in relation to the responsibility of the ship for the damages. The master is clearly liable, for it was by his act that the goods were injured. There was a constructive delivery, and the question has arisen in my mind whether, after such constructive delivery, the wrongful act of the master in damaging the goods can be visited on the ship. But this wrongful act was not malicious or intentional on his part, but was one committed in the ordinary discharge of his duties as master, and within the scope of his powers as the agent of the owners. For this I think the ship is liable. Much stress was, during the hearing, laid on the fact that the master had no notice, nor any reason to suspect that the pier was not perfectly safe, and sufficiently strong to support the load he was placing upon it. There is, however, some evidence that he had doubts on this point. But whether he did or not is not material here. A ship is bound to deliver her cargo in a proper placethat, is, a place proper for the amount that is to be landed, and which it is to support at any one time. (The Majestic, Legal Obs., N. Y., p. 100; Judge Ingersoll's remarks, p. 105.) This dock or place is selected by the ship, and it is for her, and not the owners of the cargo, to see that it is sufficient to support the load that she places upon it, and that the weight of the cargo is properly distributed over the pier so as to secure its safety. The only remaining question is, whether the damages of the resp. arising out of this accident can be recouped from the claim for freight, and if there is a balance in their favour, whether it can be recovered in this suit. That the damages suffered by the resps. can be recouped from the freight money, which the libelants would otherwise recover, appears to be settled upon authority: (Bearse v. Ropes, Sprague's Decis. 331; Snow v. Carruth, Ibid. 324; Thatcher v. McCulloch, Olcott Adm. 365; Bradstreet v. Herron, Abbott Adm. 209; Zerega v. Poppe, Ibid. 397.) By way of recoupment, the resp. can, as the damages arise out of the same transaction, extinguish a portion or all the claim of the libelants. But they can go no further. The court cannot pronounce in their favour for any sum in which their damages may exceed the amount of the libelants' demand. In Nicholls v. Tremlett, Sprague's Decis. 367, the court says: "The Admiralty does not take cognisance of pleas in set-off, no statute having given it that authority, and it has been thought by some that a distinct claim by the resp., founded upon the violation of the contract by the libelant is in the nature of a set-off, and so not cognisable by this court. But I am of opinion that where the counter claim is founded upon the same charter-party, the resp. may set it up in his answer, so that the damages that he has sustained may be recouped from the amount which the libelant might recover. But in this case, if the damages sustained by the resp. should exceed the just claim of the libelant, the court can give no decree for the excess, the utmost effect being to diminish or extinguish the claim of the libelant; nor could the resp. afterward maintain a suit for such excess. He cannot be permitted to split up his demand and litigate the same question twice. Having once voluntarily submitted his claim for damages to the court, he must be content with such relief as the tribunal may afford him." I understand this to be a correct statement of the law both in the Admiralty and common law courts: (Sickles v. Patterson, 14, Wend. 257.) And it follows that this court can render no judgment for the resps. to recover any excess beyond the libelants' just claim. Had the resps. filed a cross or independent libel they would have recovered their whole damages. But it is too late now. They must content themselves with a diminution_or extinguishment of the libelants' just claim. Let an order be entered referring the case to a commissioner to take the proofs, and report to this court the amount of freight which might be due to the libelants under the bill of lading, and the amount of damage which [ADM. the resps. have suffered by the injury to their goods from the cause mentioned in the answer, together with the expense which they incurred in recovering it from the water. On the coming in of the report a final decree will be entered in conformity to the rules laid down in this opinion. For libelants, Bebee, Dean, and Donohue. THE PATRICK HENRY. Bill of lading-Foreign coin carried as cargo and lostDamages-Freight. Where a ship at Melbourne bound for New York received on freight a quantity of sovereigns and gave a usual bill of lading therefor, but failed on her arrival to deliver them to the indorsee of the bill of lading: Held, that in fixing the amount of damages, the bill of lading was to be treated, not as a contract to pay money, but to carry and deliver goods. That the value of the sovereigns was not to be fixed by a statute which fixed its computation for ordinary transactions, but by their actual value in the currency of the country: That the clause in the bill of lading fixing the freight at so many pounds sterling was a promise to pay money, and in calculating the freight the pound sterling must be taken at its legal value. This was a libel filed against the ship Patrick Henry, by Reuben Ross, jun., who was indorsee of the following bill of lading: Shipped, in good order and well-conditioned, by James Patrick, in and upon the good ship or vessel called the Patrick Henry, whereof is master for the present voyage Wm. Page, and now riding at anchor in Hudson Bay, and bound for New York, one bag containing ninety sovereigns British sterling, being marked and numbered as in the margin, and are to be delivered in the like good order and condition at the aforesaid port of New York (the act of God, the Queen's enemies, fire, and all and every other dangers and accidents of the seas, rivers, and navigation, of whatever nature or kind soever, freight for the said goods, 21. sterling in full, with primage and excepted), unto order or its assigns, he or they paying average accustomed. In witness whereof, the master or purser of said ship or vessel hath affirmed to four bills of lading, all of this tenor and date, the one of which bills being accomplished, the others to stand void. (Signed) Dated in Melbourne, Sept. 19, 1865. WM. C. PAGE The ship having received the goods, and given the bill of lading, proceeded to New York, where she arrived in Dec. 1865, but failed to deliver the sovereigns. Her owners contended that they were only liable for the value of the sovereigns, as fixed by a statute passed years before, fixing their value for commercial transactions, instead of the actual value in the currency, which had depreciated, though made a legal tender by statute for the payment of debts. SHIPMAN, J.-The only question in this case is as to the true rule of damages, the breach being admitted. The libellant claims that he is entitled to recover the market value of the coin at this port at the time it should have been delivered. The claimant, on the other hand, insists that in estimating the damages the value of the sovereigns should be taken at the rate fixed by law for computation in ordinary commercial transactions, the same as if this were a suit to recover the amount of a bill of exchange or other promise to pay. I do not accede to this view. The agreement in this bill of lading is not a promise to pay money, but to transport certain articles on freight. Whether these articles were gold coins, gold bars, gold dust, or gold in any other form of use or ornament, can make no difference. Like every other article placed on freight, and covered by a bill of lading, unless delivered MAR. DIGEST.] GENERAL AND PARTICULAR AVERAGE. [MAR. DIGEST. having sunk, an order from the underwriter was obtained for raising it: Held, that the owners of the goods had a right of action for damages on account of the copper ore having been detained in security for expenses of raising it, and that as against them there was no lien at common law for salvage or general average. The underwriter was the person liable under the express contract: Hollis v. Claridge, 4 Taunt. 807; and Steadman v. Hockley, 15 M. & W. 553, referred to. (Castellain and others v. Thomson and another, C. B., Nov. 21, 1862; 13 C. B., N. S., 105; 32 L. J. 79, C. P.; 7 L. T. Rer. N. S. 424; 1 Mar. Law Rep. 259.) 3. Insurance on steamship-Clause “particular average recoverable on hull and machinery separately"- Expense of extinguishing fire.-Under a policy of insurance on a steamship, wherein the hull and machinery were, as usual, separately valued, and particular average amounting to 3 per cent. stipulated to be recoverable on each, as if separately insured: Held, that the expense of extinguishing a fire in the hull of the ship was properly hull and machinery, and could not be added as an exapportioned as a general charge, or general average, on pense incurred upon the hull only to the particular average on the hull, in order to make up 3 per cent. on its insured value: (Oppenheim v. Fry, Q. B. May 4, 1863, 1 Mar. Law Rep. 333; 3 B, & S. 873; E. C. May 10, 1861, 2 Mar. Law Rep. 17; 5 B. & S. 348; 33 L. J. 267.) according to the terms of the contract of affreight- | A barge employed to convey copper ore from a ship ment, their value may be recovered by the holder of the bill. That value is to be estimated in the currency of the country in which the port of delivery is situated, and where the suit is brought, unless otherwise provided for in the contract itself. The proof is that these sovereigns were worth in this market at the time they should have been delivered 7 dols. 5c. a-piece in our money. Our recent Legal Tender Act and the decisions under it cited at bar have no application to this part of the case. There is another question of trifling importance so far as the amount depending upon it is concerned, which requires to be disposed of, and that is whether any deduction should be made on account of freight. No freight was strictly earned, as the contract was not fulfilled. But admiralty courts have power to do substantial justice between parties, and substantial justice in this case is to make the libellant good for the loss sustained. He is, under this breach of the contract, entitled to the value of ninety sovereigns at the market rate, less two pounds sterling freight money. As the stipulation to pay these two pounds was a promise to pay money at this port, they should be reckoned in the currency of this country, according to our laws. The legal value of the pound sterling in commercial transactions in this country is fixed by Act of Congress at 4 dols. 44 c. The value of ninety sovereigns at the time of the breach was 634 dols. 50 c. From this deduct two pounds sterling, computed in our money (8 dols. 38 c.), will leave 625 dols. 62 c.the principal sum the libellant is entitled to recover. To this should be added interest at the rate of 7 per cent. from Dec. 28, 1865 to the date of the decree. The clerk of this court is hereby directed to compute the interest, and add to it the principal sum. Then let a decree be entered for the amount of principal and interest in favour of the libellant, with costs. DIGEST OF CASES IN GENERAL 1. Goods "warranted free from particular average [NOTE. These decisions were in conflict with the practice of average, as briefly described in the treatise under the title "Total Loss," in the Digest of Maritime Law Cases, 1837 to 1860, No. 2267b. But it has been finally determined in the case of Kidston v. Empire Marine Insurance Company, L. Rep., 1 C. P. 535; and L. Rep., 1 C. P. Ex. Ch. 357, that the distinction between "particular average," signifying damage by sea water or partial loss, and "particular charges" forms by long settled usage a part of the ordinary contract of Marine Insurance. See sect. 7 hereof.] 2. Barge sunk in crossing river-Action of detinueQuestion as to lien on cargo for expenses of raising it by order of underwriters-Salvage or general average. (a) The great importance and interest attaching to the difficult subject of average, will doubtless give special value to this Digest of the cases decided since 1860. We intend to follow it with similar Digests of some other important branches of Maritime Law. 4. Average-Jettison.-Construction of clause in a policy of insurance on goods: "Free from average or claim arising from jettison or leakage, unless consequent upon the absence of punctuation stranding, sinking, or fire: renders the meaning uncertain: (Carr and another v. The Royal Exchange Assurance Company, Q. B. Nov. 20, 1863, 2 Mar. Law Rep. 4; 33 L. J. 63; 10 Jur. N. S. 316.) 5. Lien for freight and general average-BottomryTranshipment-Arrest of cargo-Right to forward it for earning freight-Suits as trustees for underwriters when transhipping and fowarding it to its destination, and claim satisfied by them.- Lien on cargo for freight on for general average in preference to bottomry bond. A ship called the Galam, bound from Hayti to Europe, calling at Falmouth for orders, put into the port of Angra, in Terceira, under average, and was there condemned. The cargo was transhipped into a vessel called the Mary Jane, and the expenses secured by a bottomry or respondentia bond on the cargo payable at Falmouth. The Mary Jane was wrecked at Scilly, and the owners settled with their underwriters for a total loss of that ship and her freight. The cargo was ordered to Hamburgh, but was arrested in the Admiralty Court by the bottomry bondholder, and brought to London, where it was sold. The underwiters on freight per Mary Jane, did not abandon their right to forward the cargo to its destination: Held, reversing the judgment of the Admiralty Court, that there was a lien for freight, and for general average per Mary Jane, upon the proceeds of the cargo in preference to the bottomry bond. The Constancia, 2 W. Rob. 287, and the North Star, 1 Lush, 45, as to the Admiralty Court not having jurisdiction in questions of general average, or in claims for loss on the present case. cargo sold to pay expenses, considered not applicable to The expense of transhipping and forwarding the cargo of the Galam was in the nature of a salvage charge whereby the cargo was rendered available for the bottomry bondholder or any one else. Suits in the Admiralty Court or at common law, are made in name of the master (or owner) as trustee for the underwriters where his claim has been satisfied by them: (Cleary v. Macandrew; Cargo ex Galam, J. C. P. C. Dec. 9, 1863, 1 Mar. Law Rep. 408; 9 L.T. Rep. N. S. 550; 10 Jur. N. S. 477; 33 L. J. 97) (5 Law Digest, 258, case incorrectly described.) 6. Jettison of cargo adrift.-Loss of goods stowed on deck, jettisoned after having been washed adrift, and obstructing the pumps, held to be recoverable by general contribution. Where a charter-party stipulates that a deck cargo shall be carried, its jettison becomes a subject of general contribution. Practice of average adjusters, not allowing wreck cut away as general average approved of: (The Shooting Star, Johnson v. Chapman, C. P. 1865, May 3, and July 10, 35 L. J. 23.) [NOTE.-The effect likely to be given to this judgment MAR. DIGEST.] GENERAL AND PARTICULAR Average. seems to be not altogether satisfactory. The jettison of deck cargo adrift is often, ndeed, perhaps in most instances, a matter not of choice, but of inevitable necessity.] was 7. General average--Advance of freight.-Held, that freight paid in advance, not being at the risk of the shipowner, the charterer, by whom the cargo shipped, is liable to contribute on the advance of freight to general average after the ship's arrival at her port of destination, which advance is virtually increased value of the cargo. According to Hicks v. Shild (7 E. & B. 633) the advance of cash, being by the terms of the charterparty made subject to insurance by the charterers, was an absolute advance of freight not recoverable back from the shipowner in the event of the loss of the ship, and therefore at the charterer's risk: (Trayes v. Worms, C. P. June 8, 1865, 2 Mar. Law Rep. 209; 34 L. J. 274 12 L. T. Rep. N. S. 547.) [NOTE-This case clearly points out the impropriety of deducting any wages or port charges from the contributory value of freight advanced in adjustments of general average.] 66 8. "Particular average" does not include particular charges"-Transhipping and extra forwarding expenses on cargo in case of shipwreck, recoverable on a policy on freight, "warranted free from particular average."-This was an action under a policy of insurance on freight, "warranted free from particular average unless the ship be stranded," for a voyage, with a cargo of guano, from the Chincha Islands to the United Kingdom. The ship was not stranded. In the course of the voyage she was seriously damaged by perils of the sea, put into Rio, and was there condemned as irreparable. The cargo was transhipped into another vessel, and forwarded to its destination at an expense which amounted to less than the original freight insured: The Court held, that the underwriters were liable for the charges of transhipping and forwarding the cargo to the United Kingdom as an expense within the suing and labouring clauses incurred to avert a total loss of the freight. In delivering the judgment of the Court of C. P., Willes, J. observed that, without incurring the expense in question, the freight insured would never have had any complete existence; it would have been totally lost. That the only right of the shipowner in respect of freight was to detain the cargo for a reasonable time at Rio, in order to send it on in another vessel to its destination, and so earn the freight. As the cargo lay at Rio, no part of the freight had become due; no freight, even pro rata itineris could be claimed by the shipowner. The expense was incurred in consequence of a peril insured against, to prevent the destruction of the subject-matter, for which in the event of its loss, the underwriters must be answerable. The terms of the suing and laboring clause in the policy of insurance are that "in case of any loss or misfortune it shall be lawful for the assured to sue, labour, and travel in and about the defence, safeguard and recovery of the subject-matter of the insurance, or any part thereof, to the charges whereof the underwriters will contribute in proportion to the amount insured." And the court held that the true construction of this clause is, that it extends not only to every case in which the thing insured becomes, or may become, by abandonment, the property of the underwriters; but to every case where labour is expended in warding off loss, damage, or detriment, for the consequences of which the underwriters would be answerable, to every case where they might incur liability, and might, therefore, derive a benefit by the extraordinary exertions, that they ought cent. [MAR. DIGEST. to contribute to the expense of avoiding detriment, in proportion to what they would have to pay if the detriment had come to a head for want of timely care. In the course of their reasoning on the subject the court took occasion to express their opinion that the evidence given before the jury established an understood meaning of "particular average," as applicable only to a partial loss of or damage to, the thing insured, and not including "particular charges;" and also to mark their approval of the existing rules of average adjustment on goods by the following examples; For instance, in a case where goods are, by the memorandum at the foot of the policy, warranted free from particular average under 5 per cent., and the goods are wetted by sea water in a storm which drives the ship into a port of refuge, by drying the goods at an expense of less than 5 per cent., the damage may be prevented from amounting to 5 per cent., whilst if not dried they would decay and become damaged over 5 per It is obviously then the duty of the master to use all reasonable means to preserve the goods, and obviously for the interest of the underwriters to encourage the performance of that duty by contributing to the expense incurred. Accordingly the rule has been to pay for damage to memorandum articles only when it exceeds the specified percentage, and not to allow the percentage to be eked out by expenses falling within the meaning of the suing and labouring clause. The amount of expense reasonably incurred in preserving the goods is, according to practice, contributed to by the underwriters, however small in result the actual damage to the goods may be, and the partial loss or damage is paid only if it amounts to the stipulated percentage. Thus, if in the case put, the expense was 2 or 3 per cent, and the damage only 2 or 1 per cent., according to the present practice the underwriters would pay the expense, but not the damage. Were the practice otherwise, the underwriters, though saved from loss, would be altogether exempt from contribution, and they would be exposed to the very inconvenience which the memorandum has been supposed to obviate by the protection it affords them from frivolous demands in respect of small losses: (Kidston v. Empire Marine Insurance Company, C. P. May 8, 1866, L. Rep., 1 C. P.535; Ex. Ch. Feb. 4, 1867, L. Rep., 2 C. P. 357, Ex. Ch.) 9. General average.-Extra expenditure of coals bringing auxiliary screw steamer home from Rio instead of discharging cargo and repairing ship there: Held not to be general average, and not recoverable as a charge substituted in lieu of other expenses. Question as to unshipping and warehousing gold: (Wilson v. Bank of Victoria, Q. B. Feb. 12, 1867, 16 L. T. Rep. N. S. 9; L. Rep., 2 Q. B. 203. [NOTE.-Considering the practice of average in regard to substituted expenses, and the equity of the case, this judgment seems open to objection.] We select the following decision from a "Digest of the United States Reports." CARRIER. 1. Where goods are shipped which must pass through the hands of several intermediate carriers before arriving at the place of their destination, an intermediate carrier does not relieve himself from liability as common carrier by simply unloading the goods at the end of his route, and storing them in his warehouse, without delivery, or notice to, or any attempt to deliver to, the next carrier: (Mc Donald v. The Western R. R. Corp. 34 N. Y. 497.) END OF VOLUME II. |