Smith v. Eastern Railroad

CURTIS, Circuit Justice. The lien asserted by the libellants depends for its validity upon the construction of the act of the legislature of Massachusetts, passed on the 9th day of May, 1848, entitled, “An act establishing a lien on ships and vessels in certain cases.” The principal question is, whether by this act it was intended to create a lien, for the security of a debt, incurred for materials sold to one, who had entered into a contract with the owner of the vessel, to make certain repairs for an agreed sum of money, to be paid to him by the owner, of which contract the vendor of the materials had notice at the time of the sale. That, it is competent for the legislature to provide for liens on domestic vessels, to secure not only the debts contracted by. or on behalf of the owner, for labor, materials, and supplies, but also debts contracted by those undertaking the repairs of such a vessel, must be admitted. Such laws, in respect to buildings on land, exist in many of the states, and there is an act of congress to the like effect in the District of Columbia, which received a construction by the’ supreme court, in the case of Winder v. Caldwell, 14 How. [do U. S.] 434. The question is. whether this act was intended to apply to any other debts than those of the owner of the vessel. The first section is as follows: “Whenever a debt is contracted for labor performed, or materials used in the construction or repair of, or for provisions and stores and other articles furnished for, or on account of, any ship or vessel within this commonwealth, such debt shall be a lien upon such ship or •vessel, her tackle, apparel.-and furniture, and shall be preferred to all other liens thereon except mariners’ wages." The terms of the section are not decisive respecting this question. “A debt contracted.” may mean [528] by or on behalf of the owner of the vessel, or by and on behalf of one who, having undertaken the repairs, purchases the materials on his own account, and uses them upon the vessel in the execution of his contract. The intention of the legislature can be arrived at only by considering the nature of the act, and of the rights involved in it, and its adaptation to carry out the object ! contended for by the libellants. If the act \ is to be so interpreted as to embrace this case, it is obvious that by its operation double liens were created; one, securing the stipulated price agreed to be paid to Roberts for all the work and materials under his contract with the owner, and others securing to the libellants, and all persons with whom Roberts contracted for materials and labor, the prices he agreed to pay therefor. The act contains no provision for marshalling these liens, or for restricting the amount of those of the second class, to the contract price agreed to be paid to Roberts by the owners, nor for any means of protecting the owners, by notice or otherwise, against be- :: ing compelled to pay twice for the same ma- ' terials. Suppose Roberts had filed his libel ' to enforce his lien for the contract price; according to this act he must have had a de- . cree. No authority is given to call in other t parties with whom Roberts contracted, in | order to ascertain whether debts are due to j them, for materials used in the repairs, and ¡ the owners would ordinarily have no means j of knowing with whom Roberts contracted ¡ for materials. And yet, having forced the ¡ owners to pay Roberts, if he failed to meet j his own engagements, the court would be i compelled, on the application of those who ■ had sold materials to him, to make a decree j in their favor; and thus oblige the owner, ¡ who was in no fault, and had neglected no j means of self-protection, to pay Roberts’s ¡ debts, contracted at his discretion, both as | to amount and terms of credit, in addition j to their own. This practical operation of the ; construction contended for, is so unjust, that ¡ I cannot suppose the legislature intended it . It would require very clear language to con- I vince me that the law was designed to give ] rights which cannot exist, without producing j so much embarrassment and wrong, that it would be really beneficial to no class of persons. These views are strengthened by looking at other acts passed by the legislature of Massachusetts upon a kindred subject, and : which may, therefore, be considered as in pari materia. Besides the provisions of the Revised Statutes, on this subject, there are two acts now in force for securing to me- ; chanics and material-men payment for labor • and materials used in erecting or repairing : buildings on land — the .Acts of the 24th day : of May, IRrn, and of the 21st day of May. ■ 1852. The first applies only to labor; and ¡ it provides, in terms, for contracts with the j owner, "or other person who has contracted ' with such owner for erecting, altering, or repairing such building,” &c.; and it requires-a notice of the claim to be recorded in the-registry of deeds, within sixty days after the labor is performed. The other act applies to labor and materials, and limits the-amount of the liens of sub-contractors to the-amount of the contract with the owner; and declares that there shall be no lien for materials, “unless the person claiming such lien shall, before furnishing such materials, havo given notice, in writing, to the owner of the-land, and to the person who has contracted with the owner of the land, that he intends to claim such lien, for materials furnished as aforesaid.” It can hardly be supposed that the legislature should thus enable the owners of buildings to protect themselves against embarrassment and injustice, and at the same time leave the owners of vessels no means of doing'so; or that they should have used clear and express terms to confer a lien on sub-contractors upon buildings, and intend to confer it on sub-contractors upon vessels, by a mere ambiguity. My opinion is, that so far as respects vessels already built and equipped, the object, and the whole scope of this act was, to create the same lie» upon domestic vessels, for materials, repairs, and supplies, as existed by the general maritime laws of the United States upon foreign vessels. The second section of the act provides “that nothing in this act shall alter, or be construed to alter, or in any way affect, the lien as now existing on foreign ships and vessels.” To them it was not designed to apply; probably for the reason that the regulation of liens upon vessels engaged in commerce between the several states, or with foreign nations, and not belonging to citizens of the state, is not a proper subject of state legislation. It is a regulation of commerce, within the power conferred on congress by the constitution. Now, it is true that, under the maritime law, materials and supplies are presumed to be furnished on the credit of the vessel and owners until the contrary is proved. But the contrary is proved, when it appears that the materials were sold to a mechanic for his own account. It is true that the libellants expected, when they sold these materials, that they would be used on the steamer, and that, in point of fact, nearly all of them were so used. But they knew that Roberts did not purchase them under any agency for the owners; that he purchased them for himself; that they became his property when delivered; that they were at his risk; and he was at liberty to make any use of them, he might please to make. They were, therefore, bought by him on his own account, and the credit must be deemed to have been given exclusively to him, for he was and was known to be, the sole debtor; and in such a case there is no lien by the maritime law. It has been argued that this act ought to receive a liberal construction, for the security [529] of those whose labor and materials go to the benefit of owners of vessels, and that such liens are favored by the maritime law from sound policy. I entertain no doubt that the liens which that law creates, are for the advantage of commerce, and of the seamen, mechanics, and material-men, in whose favor they exist. But I am equally clear that, to give sub-contractors liens upon vessels, with no adequate means to work them out, without embarrassment and injustice to owners, ■would, in the end, benefit no one. Its practical effect would be, either to compel owners to employ only those who had so much capital, as to afford undoubted security that they would meet their engagements with third persons, or to transfer the business of repairing vessels, to places where the laws created no such dangers. And either of these effects would be injurious to the classes of persons, whom this law was intended to benefit. In my judgment, sound policy requires an observance, in the case of domestic vessels, of those limits prescribed by the general maritime law, which have been deduced by experience from the practical necessities of commerce, and of the interests of those connected with it. The decree of the district court must be reversed, and the libel dismissed, with costs.