Mercantile Bank of Americas, Inc. v. Flower Lighterage Co.

HOUGH, Circuit Judge (after stating the facts as above). In so far as the decree below dismissed the libel against Flower Company, it was right, because there was no proof, nor even attempt to prove, that the Huron was either unseaworthy or negligently handled. On this record there never was any excuse for filing the libel. The correctness of the decree, in so far as it awarded damages against Dock Company, depends on the nature and effect of the suit brought by Flower Company as bailee against appellant, and the subsequent settlement and release. The suit by carrier as bailee was usual and proper within the most familiar rules of admiralty. Benedict (5th Ed.) p. 323, and cases cited. Flower Company, as bailee, had good right, not only in admiralty, but at law, to sue for all the damages inflicted on chattels in the bailee’s possession; the possessory title suffices. Knight v. Davis, etc., Co., 71 F. 662, 18 C. C. A. 287; Moran v. Portland Steam Packet Co., 35 Me. 55. It makes no difference that the bank might have instituted separate suit for its own loss, or (as is frequently done in admiralty) entered the separate appearance of its own proctors in the carrier bailee’s suit. The evidence shows cqnelusively that it knew of the suit, approved of it, and, most important of all, received and appropriated the benefit thereof. Effort is now made to differentiate the claim for shortage, for which full recovery .was had, from the claim for damage advanced in the present suit. We cannot perceive any difference from this record. What was sued for by the bailee was damage; what was recovered was called by the same name, and so is what is now sued for. Also we think it clear on the evidence that the reason for shortage, i. e., failure to deliver after wetting all receipted for on shipment, was the same reason as that for damage, i. e., the practical sinking of the Huron at and because of her foul berth. Whatever lawful demand libelant was entitled to make against Dock Company was single and indivisible, and the course here pursued is in our opinion a plain infringement of the rule against splitting claims. Baird v. U. S., 96 U. S. 430, 24 L. Ed. 703. Further, the matter proceeded to an express release under seal, and there is neither pleading nor evidence attacking that document as a fraud by or upon any one. Libelant seems to think that, because it did not for unknown reasons produce all its demand, when it sued for and obtained part of it, it can now multiply suits and costs in the way here exemplified. For this there is no authority whatever. It authorized one suit for damages, it took the benefit thereof, and by so doing ratified a release which truthfully recited an extinction of the claim for damages. It pocketed the consideration for the release, and now, without any suggestion of fraud, asserts worthlessness of the release. This cannot be done at law (Drobney v. Lukens, etc., Co., 204 F. 11, at page 14, 122 C. C. A. 325), and, even if the maxim that admiralty is equity were more accurate than it is, it cannot be done in equity without plea and proof of fraud. Finally, the demand of this libel, if not otherwise objectionable, is open to the charge of laches. This is not a matter of lapse of time only, but of the inequity of admitting the claim (Smith Co. v. Pomeroy Co. [C. C. A.] 299 F. 544), and it may rest on failure promptly to deny an agent’s authority arising even by implication (The Sif [C. C. A.] 290 F. 361). The inequity here is of the kind so often called “lulling into security.” The charge of foul berth is often hard to prove, and always hard to disprove. The evidence must often be obtained by underwater investigations conducted by men of seafaring habit, who are usually citizens of the world. Here the Dock Company was called on to defend against such a claim, which it had good reason to think had been closed by a release after suit, a year and a half earlier. Result is that the Dock Company’s plea of release should have been sustained. Decree reversed, with costs in both courts against libelant, and cause remanded, with directions to dismiss the libel.