Agricultural Bank of Mississippi v. Jane

Garland, J. delivered the opinion of the court. The plaintiffs allege that the Barque Jane was, in December,, 1837, chartered by her owner, Byrne, to N. S. Smith, for a voyage from Natchez or New-Orleans to Liverpool, or a port in France, and back again. That the Barque was warranted to be made sea-worthy, to stand A. 3 at the insurance offices, and in the charter party it is agreed, the price shall be four thousand four hundred dollars, $2,832 56, paid in cash, and the remainder at the expiration of the voyage. Smith was to pay all the port charges, the victualling and manning of the ship, and all and every expense attendant upon the voyage, which shall not amount to a case of average. He received the vessel in New-Orleans, went to Natchez, where he took on freight for plaintiffs upwards of eleven hundred bales of cotton, and the vessel departed on her voyage to Liverpool. It is alleged that soon after leaving the mouth of the Mississippi, without any disaster, accident or recent apparent cause, the vessel sprung a-leak and was compelled to return to New-Orleans for repairs and prevent a total loss, where a survey was — 4 — had by the port wardens and other legal officers, when the cargo was ordered to he discharged, the vessel pronounced unseaworthy, hut capable of being repaired, so as to complete the voyage. That Smith being unable to repair the vessel, placed her under the control of the plaintiffs on condition, that they should loan and advance to the said captain and charterer the sums necessary for said voyage, that in pursuance of this agreement, the plaintiffs lent and advanced said Smith money to pay the wages of the captain and crew, for supplies, labor, repairs, armament and equipment of the vessel, premiums of insurance, damage done to freighters, and such other expenses and repairs as the owners were liable to pay in the nature of a partial average. It is further alleged, that in pursuance of this agreement, the plaintiffs appointed another captain to command the vessel, fitted her out and sent her to her port of destination, thereby enabling her to earn her freight. They further say the vessel remained pledged during the continuance of the voyage, and that their advances amount to $6,917 37. It is also alleged that when the vessel first went to sea she was not sea-worthy, wherefore the plaintiffs say, Byrne has violated his warranty and thereby became personally liable for the amount claimed. There is also an allegation of being subro-gated to the rights of Smith by operation of law and the agreement aforesaid, so far as to make the warranty of the defendant enure to the plaintiffs’ benefit. The Barque was sequestered and a judgment prayed for, condemning her to be sold. The defendant denied plaintiffs’ right to sue, and craved oyer of their charter. After a general denial he specially answered : 1. That supposing the plaintiffs’ statements to be true, yet he is in no manner bound to them as he has never contracted with them. 2. The plaintiffs have no lien on the Barque. 3. They have no right of action as the money said to have been advanced was not on his (defendant’s) account, or at his — 5 — request, but for the sole use and benefit of the plaintiffs or some other person with whom they had contracted. 4. That at the time of the alleged advances, the Barque was not in the possession of defendant, but in possession of Smith, the charterer, who was for the voyage the owner and possessor thereof, and is alone responsible. 5. That the money alleged to have been advanced, was disbursed not for his use but against his express consent, he being at all times ready and willing to comply with his charter party, according to law and mercantile usage. The defendant further pleads in re-conventión the sum of $1,567 44, the balance due on the charter party. The evidence shows the Barque left Natchez and reached New-Orleans in February, 1838, -which port she left on the 19th of the same month, when, as Smith the master, and the mate, say in their protest, made on oath, “that at the time of sailing, the said Barque was tight and staunch, well manned and provided.” They proceed to say they were towed to the mouth of the river; the next day in endeavoring to get out, the steamer ran aground in the South-West Pass, and the ship ran foul of her, “which carried away the shank of the anchor, drove the flukes through the sheathing and the stock into the bows about a foot,” the vessel also grounded, but soon got off. She was taken to the pilots’ establishment, a survey was had, the damages repaired, and she again put to sea, the pumps having been frequently used, and the vessel making no unusual quantity of water. They left the Mississippi the second time, on the 27th of February, when there was no leak; in going out she again grounded on the bar, and was taken off by a steamer. On the night of the 1st of March, the weather becoming quite .severe and the sea rough, the Barque commenced leaking. The gale increased during the night, and the vessel leaked so much, as to compel the master to put back, the crew refusing to do duty, unless he did so. The vessel returned to the passes, discharged a part of the cargo to lighten her over the bar, and was towed to the’ city, where she — 6 — was examined, and pronounced by most of the witnesses un-ge^Yort^yj although there is one who says he supposes the vessel sea-worthy in the month of December, 1837, and was so, at the time of sailing. On the 15th of March, the charterer and master made a note of protest before a notary, commenced discharging the cargo, and a few days after wrote a letter to Messrs. J. H. Leverich & Co., informing them of his having returned from sea in distress, his having seen the agent of the consignees in Liverpool, that it was necessary to discharge the cargo to have a survey, and he concludes by saying he has the consent of that agent to appoint Leverich & Co. agent for himself and all concerned. There is no evidence to show that on the return of the vessel to Ncw-Orloans where the defendant resides, he was informed of it, nor was he called upon to attend the survey or repair the vessel. Smith in his protest, says, whilst at the South-West Pass, he received two messages from the defendant, one of which was to act as he thought proper, and the other stating he had nothing to do with the Barque, but requesting the master to proceed as he thought best. Whether the master had sent him any message does not appear. Not a single witness speaks of any demand being made on the defendant to repair the vessel, although he is a ship-builder, and has an extensive establishment for the purpose of building and repairing vessels, nor was he called on to furnish another vessel to take the cargo from the Jane. Mr. Leverich testifies, that after the Barque returned in distress, Smith insisted upon taking a part of the cargo to pay for the repairs, he would not give up the cotton, and it was only allowed to go under the control of witness upon condition of his paying for all the repairs of the vessel, the defendant having the privilege of appointing another captain in case the insurance offices should refuse to take risks upon the cargo on account of the captain, which it appears they did, and a new captain was appointed, the vessel and cargo consigned to witness’s friends in Liverpool, and to his own house on her — 7 — homeward voyage. The new consignees in Liverpool received the freight on the outward cargo and the witness on that inward. It further appears from the testimony of this witness, that in consequence of an increase in the rate of freight from the time the Barque sailed from Natchez to the time of her return in distress, it would have cost the plaintiffs five or six thousand dollars more to have shipped their cotton by another vessel. It further appears, that Smith continued to superintend the repairs of the vessel up to the time of her final departure', as nearly all the accounts paid by Leverich are approved by him,, he was in the same city with the defendant more than three months, and never said a word to him about repairing the vessel or paying the expenses, nor do the pláintiffs appear to have called on him until long after the vessel had sailed, and finally, it appears, that about two months and a half after the vessel had returned, had been condemned as unseaworthy, was supposed to have been so for months previous, and was then undergoing repairs. Smith, the charterer and master, and his mate, by a notarial protest on oath, say, the excessive violence of the elements as before recited, was the cause of all the loss and damage sustained by the Barque, and this protest is offered in evidence by the pláintiffs themselves, and they, by repeatedly endeavoring to effect an insurance on the cargo, seemed willing to guaranty the sea-worthiness of the vessel, and did at last warrant it, by obtaining an insurance and receiving indemnity for the loss sustained by the leaking of the Barque. The pláintiffs base their hopes of recovery on several grounds. First: The vessel was unseaworthy when the cargo was taken on board, and she first sailed; that Byrne had warranted her to be sea-worthy, and that she should stand A. 3, at the insurance offices. The counsel have read us various authorities to prove it is an indispensable obligation of every owner when he offers a vessel for freight or charter to furnish — 8 — one that is staunch and tight. This is no doubt true, and Smith, tQ w[lom the jallG was chartered, in his protest made in May, J838, uses the words of the law in which he is sustained by the mate. This declaration was made after both of them had a full opportunity of examining' the vessel. The freighters of a vessel under charter claim hr the owner for have been, oe-accidents, &c., There Is^no theVltfreighters who contract vnth the charterer, and the owner. We are unable to see the grounds of the plaintiffs’ claim to T3eneg(; 0f thg warranty made in favor of Smith. That we suppose, is as much personal to him as any other contract, and as there is bo privity between the plaintiffs and the defendant an(l they have no assignment of his (Smith’s,) rights, we do think they can recover on that ground. Smith engaged to furnish plaintiffs a good ship, and he is the person responsible for a failure to do so. When they call on him for damages for a breach of his contract, it is possible he may have a right to call ^ defendant to defend him, but until then, the plaintiffs have no right to assume Smith’s rights and use them for their be- . ° nofit. The letter to Leverich & Co. from Smith, is no assignment of those rights, but only constitutes that firm the agents of himself and all concerned, without mentioning the names or interests of the plaintiffs or the defendant, and when he was finally compelled to give up the command of the vessel, he does not seem to have abandoned his right to-receive the freight on the outward and inward cargoes, or any other to which he was entitled. They next say, they are subrogated to the rights of Smith. It is not pretended there is a conventional subrogation ; it must therefore be legal, if there be any. We have examined the provisions of our law that regulate legal subrogations and cannot find any that will cover this case. The plaintiffs do not come within any of the clauses of the art. 2157 of the Code, or any adjudged case; and the counsel has not referred us to any principle in the maritime law, which supports his position. If the counsel means that his clients are subrogated to the claims of the ship-carpenters — 9 — and other workmen and the vendors of supplies and materials, we'think he is equally unfortunate. Those persons very probably had privileges for their labor, supplies and materials, hut when the agents of the plaintiffs paid, them, they took no conventional subrogation of their rights and they' do not stand in a position to have them transferred Tqy operation of law, The payment of privileged claims against a vessel, does not subrogate the persons paying, as privileged creditors,. when there is no conventional subro-gation. The master of a vessel _even under charter party, is hound to consult the owner in the home port,when necessary- or extensive repairs are to he made. - The third ground taken by the plaintiffs is, that as the vessel was in the possession of Smith, he had a right to have her repaired and was not bound to call on the owner, If Smith had have been the master employed by the owner and not in the home'port this would probably be true. The master of a vessel in a distant or foreign port, has the power to raise money to malee necessary repairs and purchase supplies, and for that purpose, may bind the owner personally or hypothecate the vessel. This is a well established'principle of maratime law and is founded upon another well known principle that the master is the agent of the owner and has sometimes to act under circumstances that will not allow of such delay that he may be consulted. But when in a port not so distant as that injury will result from a short delay, a prudent master will, and ought always to consult with his owner, before contracting to have expensive repairs made on a vessel at his cost, and when in the home port, we think he is bound to notify and consult him. The character of the agency of the master is much restricted when in the same place with his employer, and it would be allowing an agent an almost unlimited control over the property of his principal, if he could at his will and pleasure incur large or extravagant expenditures without consultation or notice. But this case is not as strong as that of an ordinary master either in the home or a distant port. Smith was the charterer of the barque, and there is no evidence to show that Byrne knew he was to he the master, and it would he going very far to say that one party to a charter-party hy taking On himself the quality of master, can hind the other to an indefinite extent, without his consent. We are not prepared to sanction such — 10 — an application of a well understood and necessary rule. We think the master of a vessel ought on all convenient occasions to inform and consult with his owner, when any extraordinary J expenses are to be incurred, or any deviation from the ordinary rules of business is about to he made. There is no evidencealU suck ratification or consultation in this case, and we think this ground is not more tenable than the others. When there is contract”*7 tween plaintiff and defendant, the latter cannot he put m delay. It has been strongly urged by the defendant’s counsel that the plaintiff cannot recover in this case, because the defendant has not been put legally in default according to the article 1905 of the Code. If this suit had have been brought by Smith for damages for a breach of the contract, of to coerce a specific performance, it is very probable it would have been necessary Put ^le Palty ia default, and if we held the plaintiffs were the assignees of Smith, they would come under the same obli- . . gation. But as there is no contract between plaintiffs and ¿efen¿aia.|. carmot fog pUt jn ¿folay. Upon a full examination of all the circumstances of this case, we do not see hut one ground upon which the plaintiffs can hope to recover, and that is, as Byrne was residing very near to the place where the vessel was repaired', he is presumed to know what was doing to her, and as he did not object to the repairs being made or offer to do them himself, he ought to pay for them. This rests upon the equitable principle that one man ought not to enrich himself at the expense of another. In considering it, the motive that induced the plaintiffs to undertake the repairs to the Jane ought to he taken into consideration. The equities on both sides should he weighed. There is no doubt a considerable sum of money was expended by plaintiffs on a vessel belonging to defendant, by which her value was much increased, hut the evidence leaves it doubtful whether he knew any thing about it. On the other hand, the plaintiffs did not act entirely from disinterested motives in making the expenditures and advances they did. Their own witness says they profited five or six thousand dollars by the outlay, in consequence of the increase in the rate of freight. — 11 — We do not think the verdict fully sustained by the evidence nor do we think substantial justice has been done between the parties ; we must therefore remand the case for a new trial. Proposals for a compromise or conversations ^eraliy ^ ad-fact or distinct liability is admitted,evidence hie party the benefit of all the conversations or ?vMch.Sltl0ntook The plaintiffs have directed our attention to a hill of exception taken by them to the opinion of the court excluding a letter from defendant addressed to J. H. Leverich, Esq., on the 19th of October, 1838. The ground On which the letter was rejected was, it was a proposal for a compromise, in compliance with a request from Leverich. If the letter contained nothing more than proposals for a compromise we should say the judge did not err in rejecting it, hut we think it makes an admission of a fact, to establish which it was proper evidence. It says “ I am willing either to sell the ship at a low price or charter her, so as to pay what I may be indebted to the bank ; in no case, however, shall I agree to pay all the hills,” &e. He also says, he is willing to pay the sum for which he could have repaired the vessel in his own yard, which is about three thousand dollars. The rule of evidence is, that mere proposals for a compro- . . ... _ mise or the conversations or negotiations which may take place for the purpose of effecting one, are not generally admissible as evidence, but if in the proposals, conversations or negotiations any fact or distinct liability is admitted, evidence may be _ . - - , , . given of that, but the party who is attempted to be charged m this manner, is entitled to have the benefit of all the conversation or proposal, and the whole should he considered by the * r # , * court and jury; 2 Starkie, 38; 2 Martin’s Rep., 175; 4 Pickering, 377. If a claim be set up against an individual and he say, I do not owe it, but rather than have a suit or further culty I will give or pay a certain sum, this should not be admitted; hut if on the presentation of an account certain items are admitted and others denied, this may be given in evidence; so if we have a demand against another and in endeavoring to settle it, the person charged admits the indebtedness but denies the extent of it, the whole may be admitted — 12 — as evidence. We therefore think the judge erred in rejecting tj1(s Jetter of .the defendant. The judgment of the Commercial Court is therefore annul- . led, avoided and reversed, and the case is remanded to that court to he proceeded in according'to law, with directions not to reject the letter of the defendant of the 19th of December, 1888, the plaintiffs to pay the costs of this appeal.