Woods v. Olsen

PARDEE, Circuit Judge, after stating the facts as above, delivered the opiuion of the court. The libelant contends that he was not liable for expenses incurrccj in releasing the ship from capture, and had.no interest in the matter as to whether she was released or not, except that he desired to aváil himself of an option to extend the time of the charter, and that he paid the money at the request of the owner, for his account, and understood he would he reimbursed. The claimant, on the other hand, denying that he ever recognized 1he subcharter or was bound thereby, contends that, under the terms of the first charter party, there was a demise of the ship to the charterer Woods, as owner pro [454] iiac vice, who, as such owner, was responsible for the obligations of the ship; and particularly, as it was through Woods’ fault that the vessel was engaged in the Cuban trade, where there was danger of her capture, the claimant contends that the ninth clause of the charter party, to the following effect: “And the charterers hereby agree to indemnify the owners from all consequences or liabilities that may arise from the captain signing bills of lading or otherwise complying with their orders and directions,” — rendered the charterer liable for these particular expenses, because the capture resulted from the employment the charterer gave the ship. Each party supports his contention by elaborate argument and citations of many authorities, but we are unable to agree with either. The expenses necessary to release the ship from the capture which involved the ship, cargo, and freight was a subject for general average. Douglass v. Moody, 9 Mass. 548; Sansom v. Ball, 4 Dall. 459, 1 L. Ed. 908; Jumel v. Insurance Co., 7 Johns. 412; Spafford v. Dodge, 14 Mass. 66. This last-cited case is very interesting, and we quote from it at some length. Under the charter party in that case the charterers had more control than in the present instance, for they were required to victual and man the vessel, as well as pay all port charges, pilotage, etc. The vessel, on a voyage from St.' Ubes to Boston, was forcibly taken by a British cruiser as a prize of war on the 6th of January, 1843, and detained until the 10th of May following. The- main issue in the suit was as to whether the charterers were liable for hire of the ship during the time lost by the capture. The court held that the charterers were liable for the hire. In regard to this the court said: “The defendants, by virtue of this charter party, became the owners of the ship for the voyage, or for the time stipulated in the contract. They might load her themselves, or take freight for others on such terms as they should think proper. The whole earnings of the ship, in either case, were for their use. If she should perform her voyage in a short time, the gain would be theirs. They would have the same benefit, whether as freight on their own goods or on the goods of others," as if the voyage had been unusually prolonged, while the expenses of wages and provisions which were to be paid by them would be reduced. On the other hand, if the voyage, should be delayed by adverse winds, or by any other of the common casualties or occurrences, the defendants would sustain the whole loss arising from that circumstance. They would be held to pay the increased hire and expenses of the ship and the crew, while their freight or profits from the voyage would remain the same. The plaintiffs had sold their ship for the time to the defendants, to be used in any manner not inconsistent with the contract, and, as they could gain nothing, so ought they not to lose, in consequence of the particular manner in which ■they should be employed by the defendants. If the plaintiffs had not thus parted with their ship, they might have taken freight, or employed her in some voyage on their own account; and, if it be said that the voyage might still have been prolonged by the same or the like accidents that have now occurred, the answer is that the owners in that case would have had the chance of a short and profitable voyage to compensate the risk of such a delay or detention. Suppose the owners had let their ship for a certain term of years, without designating any voyage or voyages in which she should be employed; they would certainly be entitled to the hire for the whole time, although the ship should remain in port, the whole time, in consequence of an embargo, from not finding suitable employment, from fear of capture by an enemy, or any other similar cause. The application of these principles has never been doubted when the ship has been driven out of her course by a tempest, or delayed by adverse winds, and .they have been applied, as before mentioned, when. [455] she has heen detained hy an embargo. We can perceive no difference, as it, regards this question, between a delay arising from any of those causes and that which has occurred in the present case. Here was a hostile seizure of the ship. This might have been followed by a condemnation as prize, which would undoubtedly have dissolved the contract of affreightment, but, in the events which have happened, it produced only a prolongation of the voyage. The ship was restored hy the sovereign under whose authority she was seized. The captors, therefore, admit that they had no right to condemn the property or to deal with it as captured. It makes no difference that the ship was carried into a port of the captors for examination before she was restored. If this seizure produced a dissolution of the charter party, the same consequence would follow, however short might he the period of the detention, and whether she were restored hy the captors upon examination of her papers at sea, or upon a like examination in port, or in a court of admiralty. * * * The necessary costs and charges, incurred and paid by the defendants in reclaiming and procuring the restoration of the ship and cargo, are undoubtedly to he allowed as a general average, and, when the amount is ascertained in the manner agreed hy the parties, it must he apportioned, as, usual, on the ship, cargo, and freight The sum which may thus be found due from the plaintiffs will be deducted from that which is due to them on the charter party.” Pages 71-74. In the instant case, the record shows that the hire of the vessel ivas promptly paid for all the time lost during her detention under capture, and, if proceedings had heen promptly instituted under general average adjustment, we are reasonably clear that the amount advanced hy Woods to the master could have heen lawfully apportioned between the ship, cargo, and freight. The adjustment should have been made at first port of detention, certainly before there was a separation of the contributory interests. 1 Pars. Shipp. & Adm. 486. As no such proceedings, however, were instituted before the three interests involved were separated, and the liens on them lost, we are inclined to the opinion that Woods’ remedy to recover from any one of them is lost, because of his delay in asserting his rights; but we do not so decide in the present case, and, if Woods still has the right to have an adjustment and apportionment, he may assert it in a proper suit. In this case, there is no proof upon which to base a decree in favor of libelant for any amount. Under the circumstances, the decree of the district court dismissing the libel is amended by adding the words, “without prejudice to another action as counsel may advise,” and as so amended is affirmed..