THE LAW OF THE SEA

SHIPPING SERIES
TRAINING FOR THE STEAMSHIP BUSINESS

EDITORS:

Emory R. Johnson Ph.D., Sc.D.
Dean of the Wharton School of Finance and Commerce,
University of Pennsylvania.

Roy S. MacElwee, Ph.D.
Director of the U. S. Bureau of Foreign and Domestic Commerce.

THE LAW OF THE SEA

A MANUAL OF THE PRINCIPLES OF ADMIRALTY LAW
FOR STUDENTS, MARINERS, AND SHIP OPERATORS

BY

GEORGE L. CANFIELD
OF THE MICHIGAN BAR

AND

GEORGE W. DALZELL
OF THE BAR OF THE DISTRICT OF COLUMBIA

WITH A SUMMARY OF THE NAVIGATION LAWS
OF THE UNITED STATES

BY

JASPER YEATES BRINTON

D. APPLETON & COMPANY
NEW YORK LONDON
1921

COPYRIGHT, 1921, BY
D. APPLETON AND COMPANY

PRINTED IN THE UNITED STATES OF AMERICA

EDITORS' PREFACE

This is the third volume of a series of manuals dealing with the business of ocean shipping and transportation. The first volume published dealt with steamship traffic operation and was written by Professor G. G. Huebner. The second volume was upon "Marine Insurance," the author being Professor S. S. Huebner. In the first volume published, the following preface appeared:

"This volume upon the management of ocean steamship traffic is the first of a series of manuals designed to assist young men in training for the shipping business. The necessity for such a series of manuals became evident when, as a result of the great war, the tonnage of vessels under the American Flag was, within a brief period, increased many fold. To carry on the war and to meet the demands of ocean commerce after the war, the United States Government, through the Shipping Board and private shipyards, brought into existence a large mercantile marine. If these ships are to continue in profitable operation under the American Flag, the people of the United States must be trained to operate them. Steamship companies, ship-brokers and freight-forwarders must all be able to secure men necessary to carry on the commercial and shipping activities that make use of the ships. A successful merchant marine requires ships, men to man the ships, and business organization to give employment to the vessels.

"In its Bulletin upon 'Vocational Education for Foreign Trade and Shipping' (since republished as 'Training for Foreign Trade,' Miscellaneous Series No. 97, Bureau of Foreign and Domestic Commerce, for sale by the Superintendent of Documents), the Federal Board for Vocational Education includes among other courses suggested for foreign trade training two shipping courses upon subjects with which exporters should be familiar, namely, 'Principles of Ocean Transportation' and 'Ports and Terminals.' Although such general courses are helpful to the person engaging in the exporting business, a training for the steamship business {vi} as a profession requires much greater detail in the knowledge of concrete facts of a routine nature. An analysis was made of the various divisions of the steamship office organization and it was suggested to the United States Shipping Board that as no literature existed of sufficient practicability and detail several manuals should be written covering the principal feature of shore operations.

"The response of the Shipping Board was hearty. The Shipping Board appointed Mr. Emory R. Johnson of its staff, then conducting an investigation of ocean rates and terminal charges, as its editor. The Federal Board for Vocational Education designated Mr. R. S. MacElwee, then engaged in the preparation of studies in foreign commerce. Before the project was completed Mr. Johnson severed his connection with the Shipping Board in 1919, and January, 1919, Mr. MacElwee became Assistant Director of the Bureau of Foreign and Domestic Commerce, Department of Commerce. The interest of the editors in the project did not terminate, however, and their close coöperation has been voluntarily continued out of conviction that the works will be helpful.

"The books have been written with a view to their being read by individual students conducting their studies without guidance, also with the expectation that they will be used as class text-books. Doubtless colleges, technical institutes and high schools having courses in foreign trade, shipping business and ocean transportation, will desire to use these volumes as class texts in a manner outlined in 'Training for the Steamship Business,' by R. S. MacElwee, Miscellaneous Series 98, Bureau of Foreign and Domestic Commerce, Superintendent of Documents, Washington, D. C. It is expected that evening classes and part-time schools, organized under the patronage of the Federal Board for Vocational Education, Chambers of Commerce, and other interested organizations will find the manuals useful. Should these volumes accomplish the desired purpose of giving the American people a somewhat greater proficiency in the business of operating ships, they will have proven successful."

This volume on "The Law of the Sea" is intended to present the principles of admiralty law in concise and practical form. It is a manual for the student, the owner, or the master of a {vii} vessel who may desire to acquire information concerning the main facts and principles of maritime law without attempting to acquire such a mastery of the subject as is possessed by an admiralty lawyer.

AUTHORS' PREFACE

This book is not an exhaustive treatise or a compendium of authorities. It is designed to be an outline of the subject primarily for the student, more especially the student layman who desires to inform himself of the general principles of admiralty law.

It is impracticable in a work of this sort to reprint the statutes relating to the various subjects of admiralty jurisprudence, since the federal statutes alone would constitute a volume more extensive than this. The salient features of the statutes have been noticed and references given to all of them. They are to be found in the Revised Statutes, the Compiled Statutes, the Statutes at large, and in the compilation of Navigation Laws published by the Bureau of Navigation, U. S. Department of Commerce.

The subject of marine insurance is treated in another volume of this series and is, therefore, omitted here.

In the chapter on Collision, we have not discussed the fixing of liability under particular circumstances of navigation, such as collision between vessels meeting, vessels passing, etc. While these matters are treated in most text-books, their discussion belongs largely to navigation and is useful only in a legal treatise for the purpose of determining liability after an accident has occurred. It could not guide the reader to avoid collision liability, and is therefore omitted in a work intended rather as a guide for the avoidance of trouble than as a dictionary of remedies.

For the same reason, only the most cursory sketch of admiralty procedure has been given. That is the province of the proctor, who must be consulted when litigation has become necessary.

The reader will find that a few subjects treated in the body of the work are also covered in Appendix I (Summary of the Navigation Laws). This is due to the fact that the appendix was prepared for independent publication. The repetitions are not {x} numerous and, as the treatment is different in form, it will be found advantageous to the student rather than otherwise.

Acknowledgment is made to Miss Florence A. Colford of the District of Columbia bar, for valuable and painstaking aid.

CONTENTS

THE LAW OF THE SEA

CHAPTER I
MARITIME LAW

This law is to be found in the statutory laws of different countries, the decisions of the courts and text-books on the subjects involved. Back of the laws of each particular country is what is termed the general maritime law or common law of the sea, which, like the common law of the land, consists of that general mass of usages and customs which exists by the universal consent and immemorial practice of those doing business by sea. It is effective within particular countries only so far as they consent to follow it, as is the case with international law, of which it is really a part. In general, however, it is recognized and enforced wherever the local laws are silent in regard to maritime transactions.

It sometimes becomes a question of some difficulty whether a particular object is or is not a vessel and subject to admiralty jurisdiction. Rev. Stat., § 3, define "vessel" as including "every description of watercraft or other artificial contrivance, used or capable of being used as a means of transportation by water," and in General Cass, 1 Brown Adm. 334, it was said:

In one or two old cases it was held that a dredge was not a ship but the preponderance of authority is to the effect that a dredge is a ship and within admiralty jurisdiction. The question whether a raft of logs is a vessel has been variously decided. If it be a mere pile or series of floating logs it is probably not a vessel, but rafts made of cross-ties, used as a convenient mode of bringing them to market, manned by crew, who lived thereon during the voyage and propelled by the current and by poles and oars, have been held to be a ship and subject to admiralty jurisdiction.[1] {3} So, also, a floating bathhouse, not permanently moored, but which was towed from place to place has been held to be a vessel; whereas a floating drydock, kept permanently moored, is not a vessel. The question whether barges and floats are subject to admiralty jurisdiction has been the subject of frequent adjudication, and while some old cases held that they were not, the tendency of the modern decisions is to hold that such crafts are vessels. In the Mac, 7 P. D. 126, the question was whether a hopper barge was a ship. It was decided in the affirmative by the English Court of Appeal, Lord Justice Brett saying:

The test is not altogether definite, nor always easy to apply. As was said in Grant v. Poillon, 20 How. 162: "It may be difficult, if not impracticable, to state with precision the line of this jurisdiction, but we may approximate it by consulting the decisions of our own courts."

A tort is a wrong, independent of contract, that is, it is the breach of a duty which is imposed by law and not by contract. A tort is maritime when it is committed on navigable waters. Injuries to sailors on shipboard, damage to cargo and collision at sea are maritime torts. Illustration of maritime torts and a distinction between land and maritime torts will be found in the chapters on Collisions and Maritime Liens, infra. The case of Hough v. Western Transportation Co., 3 Wall. 20, may be mentioned {5} here. A vessel made fast to a wharf took fire by the negligence of the master and crew. The fire was communicated to the wharf and destroyed it with the buildings adjacent thereto. The court held that although the origin of the wrong was on the water, the substance and consummation of the injury occurred on land and the case was not within admiralty jurisdiction.

Salvage and general average are, strictly, neither contract nor tort, but are within admiralty jurisdiction by virtue of the general law.

Here one may trace, for example, the rule of general average, the doctrine that what is sacrificed for the common benefit shall be compensated by a common contribution, a rule of such plain and simple equity that the failure of other codes to adopt it is a constant surprise. It appears in a fragment of Greek legislation and forms the text for a chapter in the Digest of Justinian. Its antecedents were probably Phœnician. It survived the Roman Empire in the traditions of seafaring men and reappears in the compilation of sea laws which Cœur-de-Lion revised on his return from the Holy Land, the Rolls or Judgments of Oléron. The Black Book of the admiralty preserves it in London. It may be traced through the Middle Ages down to the York-Antwerp Rules of 1890 and the practice of adjusters of the present day.

Or one may consider the treatment of employer's liability for injuries received in the course of the employment without his personal fault. Is vicarious liability the true test or the doctrine of fellow service? The merchants of the Mediterranean had the problem in the operations of a very large and extended commerce and the maritime law evolved the doctrine that justice requires that one injured in the service of the ship should be cured at the expense of the ship, and have his wages but no more. The last word on the real equity of this solution of a perplexing economic question remains to be said, perhaps, but the student can trace its development and application through many centuries down to the current decisions of our own Supreme Court.

On no other branch of law have tradition and custom exercised {8} a greater influence. It grew out of the necessities of navigation and commerce by sea and remains substantially uniform in spite of forms of government, racial habits and local innovations. In its essence, it is less susceptible of statutory modification than the common law and careless legislation has had only local effects, diverting business into other channels but ineffective to change the substance of the law. Maritime commerce is naturally free and the wisest commercial governments are those which regulate it least. Its freedom is a direct implication from the doctrine of the natural freedom of the seas. The extent to which governments may profitably regulate it without impairing its usefulness or diverting the current to other shores may be found in the history of this law. Underlying principles are the same whether ships move by sail or steam or electricity or are great or small. There have been large vessels before the twentieth century and an equivalent commerce. The law has remained the same. Men pay damages every day in some of our ports for overlooking rules that were current in Roman times and needless litigation is carried through appellate courts because of professional and judicial failures adequately to investigate the underlying principles of the maritime law.

The opportunities for the student are large and inviting. If this country is to do its part in the commerce of the future, its own maritime laws must be restated and reformed. This means not only the formal statutes and department regulations but also the great mass of judicial opinions of more than a hundred years. All are intertwined with each other and the result is chaotic. The fault has not been in the underlying principles of the maritime law but in legislation and interpretation. Our peculiar system has left the final word in the majority of decisions to judges trained in the common law and not professionally acquainted with any other. The result calls for the treatment which Justinian administered to the incongruous compilations, statutes and reports of his time. The student, either of business, history or law, who will apply himself to an investigation of the law of the sea and ascertain its simple fundamentals will not only have an interesting and profitable occupation but also be in a position to contribute substantially to the public welfare.

REFERENCES FOR GENERAL READING

CHAPTER II
TITLE AND TRANSFER

It is therefore usual to have all matters in relation to the title and transfer of a ship in writing and according to customary forms. This is a safe and salutary rule.

In the United States v. Ansonia Co., 218 U. S. 452, a shipbuilder in Richmond, Va., became insolvent while engaged in constructing three vessels for the government; one war dredge for the War Department; one a revenue cutter for the Treasury Department; and the third a cruiser for the Navy. In each instance the shipbuilder was to furnish the labor and materials and perform the work and was to receive partial payments from time to time as the construction progressed. In the case of the dredge, the contract provided that the parts of the vessel as its construction progressed should become the sole property of the United States, although it was further provided that the government might subsequently reject defective work or parts and might even reject the completed vessel, should it fail to pass inspection. The contracts for the revenue cutter and cruiser, on the other hand, contained no provision for the passing of title before completion, but did provide that the government should have a superior lien upon the vessels for all payments made on account. The Supreme Court (Day, J.) said:

It is undoubtedly true that the mere facts that the vessel is to be paid for in installments as the work progresses, and to be built under the superintendence of a government inspector, who had the power to reject or approve the materials, will not of themselves work the transfer of the title of a vessel to be constructed, in advance of its completion. But it is equally well settled that if the contract is such as to clearly express the intention of the parties that the builder shall sell and the purchaser shall buy the ship before its completion, and at different stages of its progress, and this purpose is expressed in the words of the contract, it is binding and effectual in law to pass the title.

The court further held that the lien reserved in the contracts for the revenue cutter and cruiser was not superior to the liens of material men under the laws of Virginia.

Ships entitled to such registration or enrollment are:

A capital distinction to be borne in mind is that between vessels entitled to engage in coastwise trade and those not so entitled. No vessel of foreign registry may engage in that trade. No foreign-built vessel of American registry, with certain exceptions,[3] may engage in that trade under penalty of a fine, although it is within the power of the Secretary of Commerce to waive the imposition of such fine, and this has sometimes been done where an emergency arising out of exceptional circumstances has made it necessary for an unauthorized vessel to trade between ports of the United States. Vessels entitled to engage in the coastwise trade are those which, being built within and owned by citizens of the United States, are enrolled for that trade. Vessels owned by corporations may not engage in the coasting trade unless 75 per cent. of the interest therein is owned by citizens.

The coasting trade consists of trade between continental ports of the United States, either directly or by way of a foreign port; that is to say, if you depart from New York with merchandise {14} for Miami, you are trading between American ports, even though you may touch at Bermuda en route. The test is whether you trade between ports of the United States as part of a single voyage, irrespective of nationality of the ship. The character of the voyage, whether foreign or domestic, is determined by its terminus (Tabor v. U. S., 1 Story 1). Thus a vessel bound from New York to Yokohama, via San Francisco, would be upon a foreign voyage. Such a vessel, flying a foreign flag, could not discharge any of her passengers or cargo at San Francisco.

Trade between the east and west coasts via the Panama Canal or Cape Horn is coastwise. Trade between ports of the United States and those of Hawaii, Porto Rico and Alaska is coasting trade, though the Shipping Board may issue permits to foreign vessels to carry passengers between Hawaii and the Pacific coast until February 1, 1922. Trade between ports of the United States and those of the Philippine Islands is by statute not coasting until February 1, 1922. Thereafter it is governed by Sec. 21 of the Merchant Marine Act, which will be found in the Appendix. Trade between ports of the United States and those of the Panama Canal Zone is not coasting.

By the coasting trade is not meant the mere putting in of a vessel at a port of the United States after leaving another port for bunkers or supplies (which is not forbidden) but trading between such ports, e.g., the carriage of cargo and passengers from one such port and their discharge at another.

The title to the ship may vest in one or more individuals or a corporation. In either case the residence or domicile of the owner is important. The law considers that for purposes of jurisdiction {15} the ship is a part of the territory of the state or country in which the owner resides, and she continues for many purposes to be subject to its laws wherever she sails (Crapo v. Kelly, 16 Wall. 610; The Hamilton, 207 U. S. 398).[4] In the case of Crapo v. Kelly, just cited, the ship Arctic, registered at Fairhaven, Massachusetts, belonged to a firm of owners, residing and doing business in that state, who had become insolvent. The insolvent court of Massachusetts undertook to include the vessel among the assets of the owners within its jurisdiction, for the benefit of creditors. The vessel arrived at New York and was attached by a creditor of the owners residing there. Upon extended consideration, the Supreme Court held:

This vessel, the Arctic, was upon the high seas at the time of the assignment (for the benefit of creditors). The status at that time decides the question of jurisdiction.... We hold that she was subject to the disposition made by the laws of Massachusetts and that for the purpose and to the extent that title passed to the assignees, the vessel remained a portion of the territory of that state.

The ship's registry or enrollment, therefore, fixes her home port and she will be considered as belonging to the state in which such port is located and as foreign to all other states and countries. Ordinarily she is liable to taxation as personal property only in the state in which her home port is situated, but this is subject to the qualification that her situs as personal property is, for purposes of taxation, governed by the same rules applicable to other personal effects. The general rule is that the situs of personal property is the domicile of the owner, and a ship will be liable to taxation in the state where the owner resides, irrespective of the location of her home port as shown on the ship's documents. Thus in So. Pac. Co. v. Ky., 222 U. S. 63, a corporation organized in Kentucky, owned a number of vessels enrolled at New York. They were held taxable in Kentucky.

The law further requires that every change in the title, command {16} or structure of the ship shall be promptly reported and placed for record in the Collector's office, so that at any time her present status, the name of her commander and entire past history may be fully shown upon its books, and the Collector will furnish on request an abstract of the title which his records disclose. This abstract, of course, becomes important whenever the ship is sold or used as security, although it will not show anything in regard to maritime liens upon it since these are, in their nature, secret.

Under present practice the owners of a ship usually incorporate. Such corporations take the complete title and are treated as the sole owner in all respects. There is nothing in the admiralty law which differentiates corporations from other owners. It is also popular to incorporate as "single ship companies" and in this way a double protection against liabilities in excess of the amount invested may be obtained.

Until the enactment of the Ship Mortgage Act of 1920, these proceedings were outside of admiralty jurisdiction. That act made substantial changes, not only in the status of mortgages of American ships, but in the manner of enforcing them. It is discussed under the title "Mortgage" infra and is printed in full in the Appendix (Merchant Marine Act 1920, § 30).

The principles governing the sale of a vessel by her master are set forth very clearly by Mr. Justice Davis, in delivering the opinion of the Supreme Court in the case of the Amelie, 6 Wall. 18: The Amelie on her voyage from Surinam to Boston encountered perils of the sea, and was obliged to seek the harbor of Port au Prince, Hayti, and was sold there at public auction by the master, and purchased by Reviere, the claimant. The owner of the cargo, because of its non-delivery, filed a libel and insisted that the sale of the vessel was not justifiable and passed no title to Reviere, the claimant; and even if the sale was proper under the circumstances, that Reviere took title subject to all existing liens.

At this point it may be observed that modern means of communication by cable and wireless render consultation with the owner feasible in many instances where it was not formerly possible, and there can be no doubt that it is the master's duty to avail himself of these means before selling the vessel. The court proceeds:

He should never sell, when in port with a disabled ship without first calling to his aid disinterested persons of skill and experience, who are competent to advise, after full survey of the vessel and her injuries, whether she had better be repaired or sold. And although his authority to sell does not depend on their recommendation, yet, if they advise a sale, and he acts on their advice, he is in a condition {21} to furnish the court or jury reviewing the proceedings strong evidence in justification of his conduct.

In this case the ship was surveyed by competent surveyors, who made a full report and advised that the vessel be sold as the cost of repairs would exceed her value. The court continued:

The sale in this case was made by parole; the master delivered the vessel to the purchaser, without, so far as appeared, executing any document evidencing the sale. On this subject, the court said:

The title of Reviere, the claimant, was questioned at the bar, because he did not prove the master executed to him a bill of sale of the vessel. We do not clearly see how this question is presented in the record, for there is no proof, either way, on the subject, but if it is, it is easily answered. A bill of sale is not necessary to transfer the title to the vessel. After it was sold and delivered, the property was changed and no written instrument was needed to give effect to the title. The rule of common law on this subject has not been altered by statute. The law of the United States which requires the register to be inserted in the bill of sale on every transfer of a vessel, applies only to the character and privileges of the vessel as an American ship. It has no application to this vessel in this case.

Sales of vessels by their masters are less common now than formerly in view of the modern facilities for communication with owners. If such sales are subject to the restrictions of the recent acts of Congress, heretofore mentioned, it would appear to be practically impossible for a master to sell an American ship to a foreigner. Whether such sales, arising as they do, ex necessitate, under the general principles of maritime law, are to be regarded as outside of the provisions of these statutes, has not been decided. There is no reason to suppose that the requirements of the statutes are suspended in such cases.

In the case of a transfer of a vessel at sea, where it is desired to preserve her nationality, it is necessary, upon her arrival at her home port, to deliver up her certificate of registration and obtain a new certificate.

In the case of United States v. Willings, 4 Cranch, 48, a share in an American vessel was transferred by parole while she was at sea; and, before she reached port, was re-transferred, also by parole, to the original owners. The government challenged her right to the American flag, but the court held that the requirement that, upon transfer, the certificate of registery be surrendered, did not mean that the ship would forfeit the flag unless such surrender were contemporaneous with the sale, since a sale may be made by parole, and, inasmuch as the ship carries her papers with her, the registration could not be attended to until she returned. The Court, speaking through Chief Justice Marshall, held that the ship, having been sold at sea by parole and bought back by her original owners, also, by parole, before she reached port, had been twice legitimately sold and as her ownership when she returned was the same as when she started, her nationality remained unchanged.

REFERENCES FOR GENERAL READING

CHAPTER III
OWNERS AND MANAGERS

Generally speaking, the part-owners of a ship occupy the legal status of tenants in common. They may, of course, become partners {26} and subject to the legal incidents of partnership. If they so agree, or if they act in such a manner, they assume the attributes of partnership, one of the chief of which is the liability of each individual partner for the entire indebtedness of the firm (The Wm. Bagaley, 5 Wall. 377).

The Daniel Kaine, 35 Fed. 785, was a contest over the surplus remaining in the registry of the court from the sale of a tow-boat. This had been allotted to the several part-owners in proportion to their shares, but the master, who was one of the owners, claimed a lien against the entire fund for advances made by him on the theory that the owners held the vessel in partnership and not merely as individual coöwners. The Court said:

It is unlawful, without obtaining permission of the Shipping Board, to place under foreign registry, a vessel owned wholly or in part by an American corporation or to transfer such vessel to any person other than a citizen (Merchant Marine Act, 1920. See Appendix), and within the meaning of that act no corporation is deemed a citizen unless the stock control and management {28} are vested in individual Americans. To enable a corporate-owned vessel to engage in the coasting trade, 75 per cent of the interest in the corporation must be American owned.

The majority of the owners have a right to employ the ship in such voyages as they may please; giving a stipulation to the dissenting owners for the safe return of the ship, if the latter, upon a proper libel filed in the admiralty, require it. And the minority of the owners may employ the ship in the like manner, if the majority decline to employ her at all.

Similarly Justice Clifford, in The Wm. Bagaley, 5 Wall. 377:

Even where the part owners of a ship are tenants in common, the majority in interest appoint the master and control the ship, unless they have surrendered that right by agreeing in the choice of the ship's husband as managing owner.

If the owner be a corporation, the control of the vessel is usually directed by the Board of Directors, as in the case of other corporate enterprises, though the holders of a majority of the capital stock may determine the disposition of the vessel and all matters relating to her, by voting their stock at regular or special stockholders' meetings, called in accordance with the company's charter and by-laws and the laws of the state in which the company is incorporated.

Admiralty, however, in certain cases, if no ship's husband has been appointed, will interfere to prevent the majority from employing the ship against the will of the minority without first entering into a stipulation to bring back the ship or pay the value of their shares. But the dissenting owners in such a case, bear no part of the expenses of the voyage objected to, and are entitled to no part of the profits.... Unless the coöwners agree in the choice of a managing owner or the dissenting minority go into admiralty, the majority in interest control the employment of the ship and appoint the master.

The admiralty practice is governed by the old maxim that "ships were made to plow the ocean, and not to rot by the wall." So, if the owners be evenly divided in opinion, the party desiring to employ the ship will prevail, on giving security to the other. In Willings v. Blight, 2 Pet. Adm. 288; 30 Fed. Cas. No. 17765, decided by the United States District Court for the Eastern District of Pennsylvania in 1800, the court quaintly expressed the law as follows:

It is a principle discernible in all maritime codes, that every encouragement and assistance should be afforded to those who are ready to give their ships constant employment; and this not only for the particular profit of owners, but for the general interests and prosperity of commerce. If agriculture be, according to the happy allusion of the great Sully, "one of the breasts from which the State must draw its nourishment," commerce is certainly the other. The earth, parent of both, is the immediate foundation and support of the one, and ships are the moving powers, instruments and facilities of the other. Both must be rendered productive by industry and ingenuity. The interests and comforts of the community will droop and finally perish if either be permitted to remain entirely at rest. The former will less ruinously bear neglect, and throw up spontaneous products; but the latter require unremitted employment, attention and enterprise, to insure utility and product. A privation of freight, the fruit of the crop of shipping, seems therefore to be an appropriate mulct on indolent, perverse or negligent part owners. The drones ought not to share in the stores acquired and accumulated by the labor, activity, foresight and management of the bees. Although the hive may be common property, it is destructively useless to all, if not furnished with means of profit and support by industry and {30} exertion; which should be jointly applied by all before they participate in beneficial results. Nor should the idle and incompetent be permitted to hold it vacant and useless to the injury and ruin of the industrious and active.

Seaworthiness is a relative term. The ship must be fit in design, structure, condition and equipment to encounter the ordinary perils of the voyage. She must have a competent master and a sufficient crew. Absolute perfection, of course, is not required; the real test is that the ship shall have that degree of fitness which the ordinary careful and prudent owner requires of his vessel at the commencement of the voyage in view of all the circumstances which may attend it.

The law does not insist that the shipowner shall in person attend to all his duties in respect of the ship. It recognizes that most of these must be met by agents. It contemplates that shipowners may avail themselves of the facilities common to business men and be relieved whenever they have properly employed competent agents to supervise the ship at sea and in port. In most instances where the maritime law may be applied the owner will not be responsible beyond his interest in the ship, for the acts or omissions of agents whom he has selected with due care.

An illustration of the liability of the owner for contract of the master within the scope of his employment is to be found in a case in which the master contracted for extra pilotage. As the United States District Court remarked in the Cervantes, 135 Fed. 573, "In pilotage cases resort may be had to the vessel or the owner or the master."

The case of Chamberlain v. Ward, 21 How. 548, illustrates {32} the liability of an owner for the tort of the master. It grew out of a collision in Lake Erie and was an action in admiralty brought in personam by the owners of one of the vessels against the owners of the other for damages, alleging the negligent operation of the respondents' vessel. The Supreme Court (Clifford, J.) held:

Owners of vessels, and especially those who own and employ steamships, whether propellers or sidewheel steamers, must see to it that the master and other officers intrusted with their control and management are skillful and competent to the discharge of their duties, as, in case of a disaster like the present, both the owners and the vessels are responsible for their acts, and must answer for the consequence of their want of skill and negligence; and this remark is just as applicable to the under officers, whether mate or second mate, as to the master, during all the time they have charge of the deck. That the mate in this case was substantially without experience in navigating steamers, and utterly destitute of the requisite information to fit him to determine the proper courses of the voyage, are facts so fully proved that it is difficult to regard them as the proper subjects for dispute; and what is more, the master knew his unfitness when he started on the voyage, and stated before the vessel left Cleveland, to the effect that he was afraid he was going to be sick, and that he had no confidence in the mate. Some of the owners also distrusted his fitness when they employed him, and made an effort to engage another person in his stead; and one of them, after having heard of the disaster, expressed his regret that the person to whom he first applied had not taken his place.

The case of Hough v. Western Trans. Co., 3 Wall. 20, was a libel in personam against the owners of the steamer Falcon. The vessel, while made fast to libellant's wharf, took fire through the negligence of the master and crew. The fire communicated to the wharf, which was destroyed with the buildings on it and those adjacent. While the court held that the tort was committed on land and, not being maritime, the admiralty court was without jurisdiction, it upheld the principle of the liability of owners for the negligence of the master and crew as follows:

The owner of a vessel is liable for injuries done to third persons or property by the negligence or malfeasance of the master and crew while in the discharge of their duties and acting within the scope of their authority. It is upon this principle that the defendants are liable, if at all, to the libellants for the damages sustained. The circumstance that the agents were in the employment of the owners on board the vessel, and that the negligence occurred while so employed, {33} and which occasioned the damage, gives to the libellants the right of action.

This is, indeed, simply the general law of master and servant or principal and agent.

The temporary ownership of a vessel by a person other than the real owner does not relieve the ship herself from those liabilities which attach to her in any event: For example, her liability for damage caused others by her torts, as faulty navigation; or from liability under those contracts for which the ship itself is primarily responsible, such as contracts for bunkers and supplies and necessary repairs elsewhere than in the home port. This principle is laid down in the case of the Barnstable, 181 U. S. 464, as follows:

The law in this country is entirely well settled that the ship itself is to be treated in some sense as the principal and as personally liable for the negligence of any one who is lawfully in possession of her whether as owner or charterer.

And in the case of Sherlock v. Alling, 93 U. S. 99, where it was said:

{34} By the maritime law the vessel, as well as owners, is liable to the party injured for damages caused by its torts. By that law the vessel is deemed to be an offending thing and may be prosecuted without any reference to the adjustment of responsibility between the owners and the employees for the negligence which resulted in the injury.

The claim of the true owner to his vessel will not, however, be defeated by fraudulent acts of the temporary owner to which the real owner was not privy, because in such a case the theory of the agency of the master or temporary owner for the real owner fails. This subject is discussed in the leading case of the Freeman, 18 How. 182. In that case the temporary owner caused the master to sign bills of lading, certifying that a quantity of flour had been shipped on board the schooner from Cleveland to Buffalo by the temporary owner consigned to the libellants. No such flour had in fact been shipped and the consignees, who had advanced money on the bills of lading, libeled the ship. The real owner filed a claim to the vessel. The Court (Curtis, J.) said:

It should be noted that the mere record title does not conclusively establish ownership. That title may be only security for the real owner out of control. The real facts may be shown when necessary (Davidson v. Baldwin, 79 Fed. 95).

{37} In Woodall v. Dempsey, 100 Fed. 653, the Court found the facts to be as follows:

The suit is for $3,513, a balance due for repairs. The work was done at Baltimore costing $16,000. The home port of the vessel was Philadelphia, the owners being Patrick Dempsey and Henry Hess, who reside here; the former having four-fifths, the latter one. Dempsey, managing owner, ordered and superintended the repairs. Mr. Woodall sought the work for his company, and came to Philadelphia to obtain it. At that time it was supposed $5,500 would cover the cost. The vessel was subsequently taken to the libellants' place at Baltimore and the work commenced in pursuance of arrangements made here. It was afterwards found that much more must be done than had originally been contemplated, and a much larger bill incurred. On the completion of the work, notes (of Dempsey) were given for the $3,513 unpaid, and the vessel was delivered to the owners.

Woodall brought an action in personam against Dempsey and Hess for the $3,513. It appeared that plaintiff dealt with Dempsey alone and there was no evidence to show that he took any action or made any expenditure on the credit of Hess. The Court said:

REFERENCES FOR GENERAL READING

CHAPTER IV
THE MASTER

In order to have the ship seaworthy, an owner must provide a master who is fully competent in respect of care, skill and honesty, a man of sound judgment and discretion; and in general, there must also be provided one of sufficient ability to supply his place, in case of accident or disability. (The Niagara, 21 How. (U. S.) 7; 2 Parsons Sh. & Ad. 1.)

Correspondingly, he is an officer to whom great power and wide discretion are necessarily confided. His authority is summary and often absolute, especially at sea, and can seldom be resisted by those over whom he is placed—as Chancellor Kent has expressed it: "He should have the talent to command in the midst of danger, and courage, and presence of mind to meet and surmount extraordinary perils. He should be able to dissipate fear, to calm disturbed minds, and inspire confidence in the breasts of all who are under his charge, in tempests as well as in battle. The commander of a ship must give desperate commands; he must require instantaneous obedience. He must watch for the health and comfort of the crew, as well as for the safety of the ship and cargo. It is necessary that he should maintain perfect order, and preserve the most exact discipline under the guidance of justice, moderation and good sense."

Our statutes require that only those whom the law has examined and approved shall occupy that position. The master must be an American citizen (Rev. St. § 4139); he must have a license from the Inspectors, who are charged to examine into his character {40} and habits, as well as his technical qualifications (§ 4439);[5] he is sworn to the performance of the duties of his office (§ 4445); he must exhibit his license to the public (§ 4446); he is subject to summary punishment for incompetency (§ 4450); and his personal liability cannot be limited, as the owners may by law. In short the law contemplates the selection of picked men as masters in the merchant marine, and forbids the employment of others.

No formalities are required in his appointment by the owner. Any authorization which would suffice to otherwise create the relation of master and servant, or principal and agent, is enough (The Boston, Blatch. & H. 309). His contract need not be in writing, even if for more than one year. His wages are a matter of contract; he has no lien on the ship (The Nebraska, 75 Fed. 598), unless, possibly, one is created by the local law of the ship's flag.

In case of disaster, his duty requires him to stay by the ship as long as there is any possibility of good resulting therefrom. The popular phrase that "the captain should be the last man to quit the ship" is well founded in law (The Niagara, 21 How. (U. S.) 7).

His authority is generally implied and is according to the law of the ship's flag. Generally speaking, he is the owner's agent and his authority extends to all matters within the scope of his appointment. Where the owner is present, or easily accessible, this authority is narrowed, but otherwise it may be very broad, and measured only by the necessities of the situation, and the use and employment of the ship.

On shipboard, his authority is supreme, except, possibly, in the presence of the owner.

He has power to enforce discipline and inflict punishment, not unlike that in the relationship of parent and child, or teacher and pupil, save that he is forbidden by statute to inflict corporal punishment (Act of March 4, 1915). The old flogging days, therefore, are over, and the master who inflicts corporal punishment is guilty of a crime. He may, in proper cases, discharge or disrate members of the crew.

On the other hand, the law charges him with the duty of seeing {41} that the crew has sufficient provisions (§ 4564); proper medical care (§ 4569); protection against unlawful violence, and the like; and he is criminally liable for abandoning sailors in a foreign port (§ 5363).[6]

{42} In dealing with other persons on board his vessel his authority is as broad as the exigencies of his situation require and he may, in proper cases, and after exhausting pacific measures put even passengers under arrest. But he cannot delegate this authority to minor officials or others on board but must personally exercise such responsible duties and see to it that nothing unreasonable is done. It has been held that while he may restrain, or even confine, a passenger who refuses to submit to the necessary discipline of the ship, he ought not to inflict any higher punishment than a reprimand upon a passenger without first conferring with his officers and entering the facts on the log. His authority to punish members of the crew must be exercised with moderation and in reason. He has no authority to punish by flogging or the use of any illegal instrument and in testing the legality of punishment or chastisement the methods and weapons employed are important.[9]

He has a lien on the freight[10] for his wages, disbursements, expenses and necessary liabilities. This may be asserted by withholding from the moneys collected by him or by an attachment or garnishment. When the ship is in charge of a licensed pilot[11] the master should remain in command except so far as the pilot's duties are concerned and see that there is a sufficient watch on deck and that the men are attentive to their duties; he may advise with the pilot and even displace him in case of intoxication or manifested incompetence. By virtue of his general agency for the owners in relation to the ship, he may sue in his own name, in their behalf, to recover for collision or for breach of contract of affreightment or on any other account connected with the business entrusted to him.

By the maritime law the master has no lien on the ship even for maritime wages.

This is supposed to be for the reason that he contracts on the personal credit of the owner and also because it would tend to impair the owner's personal confidence in his integrity. Another ground is that where the master collects the freight he can pay himself directly and so needs no lien. But a lien may be given by the terms of his contract or by a statute of the state from which the vessel hails; if it is, it will be enforced in the admiralty.

He has no lien on the cargo belonging to the owner of the ship, and, according to the weight of authority, no lien upon cargo belonging to any other shipper. He has, however, as has been said, a lien on the freight earned by the vessel for his wages, disbursements and necessary liabilities. This may be asserted by withholding from the moneys collected by him or by an attachment or garnishment. In the Arcturus, 17 Fed. 95, the vessel had on board a quantity of telegraph poles owned by a shipper and intended for delivery at Sandusky, upon which the shipper was to pay freight in the usual way. Before the poles were unladen at Sandusky, the vessel was seized by the marshal under a libel filed by certain creditors, so that the master could not and did not unload the poles, and the owner was compelled to pay $70 to have them unloaded. In addition to this, before they were unladen the owner of the poles was compelled to pay into the registry of the court the entire freight which would have been earned had the vessel delivered the poles to him. The master filed a libel, asserting that the whole freight money should be applied to his unpaid wages, and claiming also a lien on the poles, the cargo, for his wages. The court found that the master had no lien on the cargo for his wages beyond the amount of the freight; that he was only entitled to the freight actually earned by the vessel, that being the freight less what it cost to unload at Sandusky, and that he was {45} entitled to a decree for that part of the freight so actually earned, to be applied on his wages as master.

Where the master performs seamen's duties in addition to his own it has been held he is not entitled to a lien for compensation for such work, but in some more recent cases such liens have been allowed. There is a substantial conflict of authority on this point.

He (the master) must take care to stow and arrange the cargo, so that the different goods may not be injured by each other, or by the motion of the vessel, or its leakage; unless, by agreement, this duty is to be performed by persons employed by the shipper. In the absence of any special agreement, his duty extends to all that relates to the lading, as well as the transportation and delivery of the goods; and for the faithful performance of those duties the ship is liable, as well as the master and owners.

Even where the shipper employs the stevedores, it remains the right and duty of the master to control them if they are endangering the ship's safety. Thus in the Elton, 83 Fed. 519, where the charter party provided that the stevedore was to be employed and paid by the contractor and was to load the steamer under the master's direction, it was said:

At no time does the master lose his proper place in the control of his ship and everything connected therewith. The stevedore is not an independent contractor, doing the work, which, when completed, is to be turned over to the master for his approval or disapproval; but he must load the steamer at all times under the direction and subject to the control of the master.

During the voyage and until the goods are delivered he stands as bailee and has a high degree of responsibility for their safekeeping. He must pursue the voyage without deviation or delay except for the purpose of saving life. He must be watchful to protect the cargo, in whole and in parts, as against deterioration and damage. {46} Safe custody is as much a part of his duty as safe carriage and delivery. In case of emergency and necessity he becomes as much an agent of the cargo as of the owner of the ship and may sacrifice a part for the safety of the whole venture, or mortgage or sell the same, or tranship it. In the event of peril the duty and power devolve upon the master to determine whether a jettison be necessary. As the court said in Lawrence v. Minturn, 17 How. (U. S.) 100:

If he was a competent master, if an emergency actually existed calling for a decision, whether to make a jettison of a part of the cargo; if he appears to have arrived at his decision with due deliberation, by a fair exercise of his skill, and discretion, with no unreasonable timidity, and with an honest intent to do his duty, the jettison is lawful. It will be deemed to have been necessary for the common safety, because the person to whom the law has entrusted authority to decide upon and make it has duly exercised that authority.

But though the master may jettison cargo to lighten a ship in peril, he may not, for that purpose, give cargo away. It is not his to give, and if he attempts to do so, the donee takes no title and is liable for the conversion of it as for embezzlement (The Albany, 44 Fed. 431).

The duties and powers of masters of vessels in regard to cargo, as they develop out of the exigencies of navigation and the varied situation abroad, are much broader than those of the agents of carriers by land, because the circumstances are so very different. Such a master has authority to do whatever is really necessary to preserve the interests of an absent owner or consignees. He is bound to the exercise of diligence and good faith to give the owner or consignee timely information; and to follow instructions if they can be obtained. If his possession of the goods is interfered with by legal process or seizure, he must give notice, if possible, and in the meantime take all proper steps to protect or recover the goods. He may be bound to take legal proceedings or answer for the damages caused by his failure to do so.

It cannot be doubted that a master has power to sell both vessel and cargo in certain cases of absolute necessity.... Without pretending to enumerate or classify the multitude of cases on this subject, or to state all the possible conditions under which this necessity may exist, we may say that it is applied to cases where the vessel is disabled, stranded, or sunk; where the master has no means and can raise no funds to repair her so as to prosecute his voyage; yet where the spes recuperandi may have a value in the market, or the boats, the anchor, or the rigging, are or may be saved, and have a value in market; where the cargo, though damaged, has a value, because it has a market, and it may be for the interest of all concerned that it be sold.

Such dealing with the cargo must be prudent and in the interest of the cargo-owner; the master must not sacrifice the cargo to the ship more than the ship to the cargo. If he can prudently delay for communication with the owner he must do so; the exercise of this power depends upon the necessity and the utmost good faith.

The case of Australasian Steam Navigation Co. v. Morse, L. R. 4 P. S. 222; 1 Aspin. 407; 27 L. T. Rep. N. S. 357; 8 Moore P. C. N. S. 482; 20 Weekly Rep. 728; 17 Eng. Reprint 393, was decided by the Privy Council in 1872, on appeal from the Supreme Court for New South Wales. It appeared that a quantity of wool had been shipped in December, 1865, on board the Boomerang by owners living inland, for transportation from Rockhampton to consignees in Sydney. The vessel stranded and filled and the cargo was so damaged by water that it became dirty, heated and liable to ignition. It was transferred to a relief vessel which had been sent out from Rockhampton and was returned to that place, where there were no facilities for storing or drying it, and it was in danger of total loss. There does not appear to have been any means of communicating promptly with the shippers, but there was testimony on the question whether it might have been possible to reach the consignees in Sydney, a distance of 900 miles, by telegraph, considering the imperfect state of the telegraph in New South Wales in 1865, the method of management of the particular telegraph line, and the fact that communication, to accomplish anything, must have been attempted on Sunday or on the {48} next day which was Christmas. Under these circumstances, the master, after having the wool surveyed by the local Lloyds agent and a merchant, sold it without attempting to communicate. For the Privy Council, Sir Montague Smith announced the law as follows:

The general principles of law are not in dispute, viz., that the authority of the master of a ship to sell goods of an absent owner is derived from the necessity of the situation in which he finds himself placed; and consequently that, to justify his thus dealing with the goods he must establish (1) the necessity for the sale; and (2) his inability to communicate with the owner and obtain his instructions. Under these conditions and by force of them the master becomes the agent of the owner, not only with power but under the obligation (within certain limits) of acting for him; but he is not in any case entitled to substitute his own judgment for the will of the owner in the strong act of selling the goods where it is possible, as hereafter explained, to communicate with the owner and ascertain his will.

The Council defined the necessity of sale as meaning "that the course taken must be clearly highly expedient," "the best and most prudent thing to be done for the interest of the owner of the goods," and said:

A sale of cargo by the master may obviously be necessary in the above sense of the word, although another course might have been taken in dealing with it; for instance, if, in this case, the wool, which had no value but as an article of commerce, could have been dried and repacked and then stored or sent on, but at a cost to the owner clearly exceeding any possible value to him when so treated, it would plainly have been the duty of the master to sell, as a better course for the interest of the owner of the property than to save it by incurring in his behalf a wasteful expenditure. In other words, a commercial necessity for the sale would then arise, justifying the master in resorting to it.

On the subject of the necessity for communicating with the owners of the cargo, the Council say:

The necessities which may arise in the course of the voyage are innumerable and can hardly be classified, but the settled and reasonable rule is that the power corresponds to the necessity at hand. By the contract of carriage, the shipper and consignee impliedly authorize the master, when he cannot obtain instructions, to do everything within the general scope of his employment which a rational man of business might believe that a rational owner would certainly do for himself if he were present under the circumstances at hand. And even if the acts of the master were beyond the ordinary scope of his authority, they may be ratified by his principals and every ratification is the equivalent of an original specific authority. So, while it is a general rule that an agent may not delegate his authority the master may, in proper cases, appoint another in his place and stead; and such appointee will have the like powers as the original master. Circumstances may even arise where the master may sell the cargo though the owner may be in port and does not approve his action. Thus in the case of the Brewster, 95 Fed. 1000, the ship had a cargo of coal. After commencing her voyage she was forced to put back in port. Part of the coal had become wet and liable to spontaneous combustion; it being dangerous to proceed with it, the master tendered it to the shippers, who refused to receive it. He thereupon sold it. The Court upheld his action as being for the general good of the ship and cargo. This, however, was in the exercise of the master's duty to protect the safety of the whole ship and must not be understood as modifying the rule that the master, when no considerations, except those relating to cargo, are in question, may not substitute his judgment for that of the owner of cargo, where the owner's will is ascertainable. It should be noted that all the master's powers in regard to the cargo depend on the necessity {50} for their exercise and that, as long as that does not arise, he is really a complete stranger to the cargo between lading and discharge. While the voyage prospers he is only to carry it and must not intermeddle in any way.

This subject has been discussed more fully under the caption "Title and Transfer," § 16, "Sales by Master." The case of the Amelie, 6 Wall. 18, there quoted, is the leading case. It should be observed that, if the exigency is not too urgent to admit of the necessary delay, the master is bound to communicate with the owner before selling the ship, and the purchaser is bound to know the circumstances so far as he can ascertain them by reasonable inquiry. He will not acquire a good title if the emergency did not justify the sale, provided he could have so ascertained by investigation.

The law in respect to maritime hypothecations is, in general, well settled. The master of the ship is the confidential servant or agent of the owners, and they are bound to the performance of all lawful contracts made by him, relative to the usual employment of the ship, and the repairs and other necessaries furnished for her use. This rule {51} is established as well upon the implied assent of the owners as with a view to the convenience of the commercial world. As, therefore, the master may contract for repairs and supplies, and thereby, indirectly, bind the owners to the value of the ship and freight, so, it is held that he may, for the like purposes, expressly pledge and hypothecate the ship and freight, and thereby create a direct lien on the same, for the security of the creditor. But the authority of the master is limited to objects connected with the voyage, and, if he transcends the prescribed limits, his acts become, in legal contemplation, mere nullities. Hence, to make a bottomry bond executed by the master a valid hypothecation of the ship, it must be shown by the creditor that the master acted within the scope of his authority; or, in other words, it must be shown that the advances were made for repairs and supplies necessary for effectuating the objects of the voyage, or the safety and security of the ship; and no presumption should arise that such repairs and supplies could be procured upon any reasonable terms, with the credit of the owner independent of such hypothecation. If, therefore, the master have sufficient funds of the owner within his control, or can procure them upon the general credit of the owner, he is not at liberty to subject the ship to the expensive and disadvantageous lien of an hypothecatory instrument.

While the master is bound to follow instructions as to the course of his voyage, and may not deviate unless forced to do so by stress of weather or for the safety of vessel, crew or cargo, he may always deviate from his course for the purpose of saving life. He is not bound to lie by or delay his voyage for the purpose of preserving the property of third persons, though he may deviate, in the exercises of a sound discretion, to save property in peril.

All cases of offenses or of misconduct by members of the crew are required to be recorded; also all cases of illness, death, birth and marriage on board; the name of any seaman who ceases to be a member of the crew; the wages of any seaman who dies during the voyage; the sale of the effects of any such seaman, and a description of any collision that may occur.

In introducing a ship's log in evidence, it must be proved in the same manner as any other document; that is to say, it enjoys no special evidentiary status.

In case of damage or disaster during the voyage, or suspicion thereof, the master should within twenty-four hours of his arrival in port cause a notary public or consul to "note a protest" in regard to the fact; this "noted protest" should be extended before a notary as soon thereafter as possible, and at any rate, on arrival at destination and while recollection is fresh. The extended protest will be upon the usual form and contain a plain account of the misfortune and damage. As it will form the basis of any claim of underwriters or adjustment of damages, great care should be taken to express the facts clearly and according to their legal results. The master is charged with this duty and should execute the protest, together with his officers and such of the crew as have knowledge of the facts involved.

REFERENCES FOR GENERAL READING

CHAPTER V
SEAMEN

Hence, from the ancient sea codes to the most recent legislation, there is a constant provision for their welfare and protection. Their occupation is an honorable one and has its privileges accordingly; it is also one of great responsibility and has its duties and the law has both in mind.

Corporal punishment is no longer permitted; its infliction is a misdemeanor punishable by the courts, and it also renders the owner and master liable for damages. The master may, however, use a deadly weapon when necessary to suppress mutiny but only when mutiny exists or is threatened.

The laws of the United States on the subject of Merchant Seamen will be found in detail in Title LIII of the Revised Statutes and are collected with the modern amendments, including the La Follette Seamen's Act of March 4, 1915, and with full annotations in Volume 7 U. S. Compiled Statutes, 1916, pages 8772 to 8924. The Seaman's Act of March 4, 1915, is also found in 38 St. at L. 11-64.

In very recent years repeated assaults have been made upon the long established rule which prevented seamen from recovering on account of injury or death in line of duty. In Southern Pacific Co. v. Jensen, 244 U. S. 205, an employee engaged in maritime work attempted to recover damages for a maritime injury pursuant to the Workmen's Compensation law of New York. The Supreme Court held, that "Congress has paramount power to fix and determine the maritime law which shall prevail throughout the country," and that in so far as the Workmen's Compensation law of a state sought to confer upon seamen rights inconsistent with the general maritime law, the state Workmen's Compensation law was unconstitutional. Thereupon Congress by the act of October 6, 1917, undertook to confer upon suitors in admiralty "the rights and remedies under the Workmen's Compensation {57} Law of any state." Thereafter in Knickerbocker Ice Co. v. Stewart, decided May 17, 1920, the Supreme Court of the United States held that the act of Congress of 1917 was destructive of the uniformity of the principles of admiralty law, which the Constitution sought to preserve, and was therefore beyond the power of Congress to enact. Therefore, up to May 17, 1920, the date of the decision of Knickerbocker Ice Co. v. Stewart, the old rule of admiralty whereby sailors could not ordinarily recover damages for injuries in the course of their employment had successfully withstood all attacks by state legislatures and by Congress and remained the law. However, three weeks after the decision in Knickerbocker Ice Co. v. Stewart, Congress, by the Merchant Marine Act of June 5, 1920 (see Appendix), enacted the following:

That any seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law, with the right of trial by jury, and in such action all statutes of the United States modifying or extending the common-law right or remedy in cases of personal injury to railway employees shall apply; and in case of the death of any seaman as a result of any such personal injury the personal representative of such seaman may maintain an action for damages at law with the right of trial by jury, and in such action all statutes of the United States conferring or regulating the right of action for death in the case of railway employees shall be applicable. Jurisdiction in such action shall be under the court of the district in which the defendant employer resides or in which his principal office is located.

This provision, which seeks to confer upon seamen the rights enjoyed by railway employees under the Federal Compensation Act, has not yet been construed by the courts.

The rights of railway employees thus conferred upon seamen are those given by acts of Congress approved April 22, 1908, and April 5, 1910. These acts gave to the employees of railroads engaged in interstate and foreign commerce, a right of action against the employing carrier in case of injury or death of the employee, notwithstanding that the accident may have been caused by acts of a fellow servant or may have been due to one of the risks naturally incident to the employment, and notwithstanding that the plaintiff may have been guilty of contributory negligence, although in the latter case the damages are to be diminished in proportion to the amount of the employee's negligence. Suit {58} may be brought in the state or federal courts, which are given concurrent jurisdiction in such cases.

It should be observed that under neither the Merchant Marine Act nor the Railway Employers' Liability Acts is the jurisdiction to be exercised by the court sitting in admiralty. The jurisdiction invoked is that of the courts of common law.

Where, however, there is negligence on the part of the shipowner in providing a seaworthy ship, or on the part of the officer in caring for the injured man, the admiralty will award damages; if there has been contributory negligence, it will not prevent recovery but the damages will be apportioned or divided (The Max Morris, 137 U. S. 1).

The principle on which vessels are held liable for injuries to seamen due to unseaworthiness is simply an application of the rule of law that every master is bound to provide his servant with a safe place to work; that is to say, a place as safe as any prudent man would provide for the performance of work of similar character, and that failure to provide such a safe place is actionable negligence. In the Joseph B. Thomas, 86 Fed. 658, it was held that where an employee on a vessel placed an empty keg on a pile of hatchway covers in such a position that an accidental jar caused it to fall in the hatch and injure a stevedore, the master and the owners were liable and the ship was held for violation of the duty to provide a safe place to work.

In the Shawnee, 45 Fed. 769, the ship had suffered greatly from a severe storm and went under Mackinac Island for shelter. Much extra work was required by the crew and when the time came to proceed on the voyage they told the master that they would not go on unless an extra allowance of $50 each was guaranteed. Under the stress of circumstances the master was constrained to acquiesce in the demand, but on arrival the owners refused to pay this extra amount although they tendered the regular wages. The sailors thereupon libeled the ship, but the Court, in a very emphatic opinion, declared that their conduct had amounted to mutiny and that their wages should be entirely forfeited.

{59} Numerous decisions illustrate these rules.

In the Troop, 118 Fed. 769, a sailor fell from a yardarm and fractured his thigh shortly after the ship sailed; the captain might have put him in the port hospital but instead applied splints himself and sent the man to his bunk; he did nothing more for him until the vessel arrived at her destination, thirty-six days after, and even then neglected him for an additional five days before supplying proper medical care. The sailor suffered greatly during the voyage and became permanently injured. The Court held that the ship was liable for the master's failure to observe the rule of care to an injured sailor and awarded him $4,000 with 6 per cent interest.

In the Margharita, 140 Fed. 820, the ship sailed from a port in Chili for Savannah. While off the west coast of South America and about to round Cape Horn a sailor lost his footing aloft and was precipitated into the sea. As he struck the water a shark, or some other marine monster, bit off his leg at the knee, but he was rescued by another of the crew who jumped after him. The ship was then about 7,000 miles from her destination. The master gave the sailor all the attention which the ship afforded and controlled the hemorrhage and inflammation by placing the stump in tar; he continued to give him regular attention during the voyage, detailed a man to supply his wants and provided him with a suitable diet; on arrival at Savannah he was immediately sent to the hospital. The Court held that there could be no further recovery inasmuch as the master had fully discharged all the obligations of the rule.

The ordinary offenses of seamen are classed as mutiny, inciting revolt, desertion, disobedience, assaults, theft, fighting, and tampering with the cargo; but, in addition, they are liable for all crimes and offenses which would be punishable as such if committed on shore.

It should be remembered that the power of punishment on shipboard is vested in the master personally and that the law does not permit his delegating it to others. A mate has no legal right to enforce his orders by beating one of the crew. Up to about seventy years ago corporal punishment of seamen was permitted by law, owing to the nature and supposed necessities of the service, and no doubt officers find it hard to give it up. Courts of admiralty endeavor to deal with these cases in a practical way. Altercations and assaults between master and crew have never been treated by them like those redressed in the common law courts, where the slightest blow may be treated as a trespass to one's dignity and feelings of self-respect. The crew are to be protected from injury and the maritime law will amply vindicate all beatings, woundings and maltreatment, criminally and civilly. The right of self-defense is only a last resort and will seldom need to be invoked.

{62} This lien is said to inhere in the last plank of the ship and will be paid in preference to claims for penalties against the ship in behalf of the United States and port dues.

The lien for wages exists in the home port of the vessel as well as in foreign ports.

Where as sometimes in the case of a fishing voyage the crew has an interest in the result of the venture this does not affect the right to liens.

The weight of authority in the more recent decisions, reversing the older rule, is to give a lien to stevedores, longshoremen, watchmen and ship carpenters against foreign vessels (that is to say vessels not in the home port) while the authorities are in conflict as to whether such liens lie against domestic vessels.

The Merchant Marine Act of June 5, 1920, which is printed in full in the Appendix, § 30, Subsection M, expressly confers a lien for wages of stevedores, "when employed directly by the owner, operator, master, ship's husband, or agent of the vessel", and makes no distinction between the home port and any other.

In the Ole Olson, 20 Fed. 384, a schooner was libeled for seamen's wages and two men intervened and sought to recover who had been employed as stone-pickers by the master, who was also managing owner, to gather stone on the shores of Lake Michigan and assist in loading the stone on board as cargo to be carried to Chicago. While engaged in this service they lived and slept on the vessel as she lay off shore and when the weather was such that stone could not be gathered, the schooner would run into port and on such occasions these men would lend a hand in hoisting sail. They did not accompany the vessel on her voyages as she had a full crew without them. The only question was whether they rendered maritime services and were therefore entitled to the seaman's lien for wages. The Court held that they were not, distinguishing the Ole Olson from the case of the Ocean Spray, 4 Sawy. 105, and several others. In the case of the Spray the libellants were shipped as sealers and were hired to take seal for the vessel at a stipulated sum per month. Their contract also bound them "lend a hand on board whither they were wanted." On the voyage they helped make and reef sail, heave the anchor and clear decks, but did not stand watch. They also procured driftwood and water for the use of the vessel. They thus aided in the navigation and preservation of the vessel and were colaborers {63} in the leading purpose of the voyage. "Upon the principle applicable to surgeons, stewards, cooks and cabin boys (all of whom are entitled to the lien) they were to be considered as mariners." They were accordingly entitled to their maritime lien on the vessel.

Sections 8287-8297 provide for the appointment of shipping-commissioners in such ports of entry and ports of ocean navigation as require them; where no commissioners are appointed, the collector of customs or his deputy may so act; the duties of such commissioners are to afford facilities for engaging seamen by keeping a register of their names and characters; to superintend their engagements and discharge according to law; to provide means for securing their presence on shipboard according to their engagements; to facilitate the making of apprenticeships to sea service and to perform such other duties relating to merchant seamen and merchant ships as may be required by law. Section 4554 amended by the Act of August 19, 1890, provides that the commissioners shall arbitrate disputes between owners or masters and the crew on mutual application.

Shipping articles should be in the printed form required by the statute and in common use; they should be signed by each seaman in the presence of a shipping commissioner, in duplicate, and one part retained by him; they should be acknowledged and certified under the commissioner's seal, to the effect that each understands what he has subscribed and, while sober, and not in a state of intoxication, acknowledges it as his free and voluntary act; the other duplicate should be delivered to the master and seamen subsequently {64} engaging on the voyage should place their signatures thereon. The ship and also its officers are liable to penalties for shipping seamen without articles, but the requirement is excepted in the case of vessels engaged in the coasting trade and on the Great Lakes. When seamen are shipped in foreign ports where there is a consular officer of the United States or commercial agent, the master must obtain his sanction to the engagement, in substantially the same manner as in the case of a shipping commissioner at home. A copy of the articles, with the signatures omitted, must be posted on the vessel so as to be accessible to the crew, under penalty of one hundred dollars.

Shipping articles for vessels in the coasting trade, in less detailed forms, are required by § 8311 and the master is made liable to a penalty of twenty dollars and the highest rate of wages for every seaman or apprentice carried without such an agreement. All shipments of seamen contrary to law are declared void; any seaman so shipped may leave the service at any time and recover either the highest rate of wages of the port from which he shipped or the sum agreed to be paid him when he went on board.

Every sailor on an American vessel is entitled to receive from the master, at every port where the vessel loads or delivers cargo during the voyage, one-half his wages then earned; the demand, however, may not be made oftener than once in five days. Failure to so pay wages releases the seaman from his contract and foreign sailors in harbors of the United States may have the benefits of this provision.

It is unlawful to pay wages in advance, either to the sailor or to any other person on account of advances;[12] such payments constitute no defense to a subsequent suit. But a sailor may stipulate in the articles for an allotment to his grandparents, parents, wife, sister, or children, such allotment to be in writing and signed and approved by the commissioner.

Sailors' wages are not subject to an attachment or garnishment from any court and no prior assignment of wages or claim for salvage is valid.

{66} The effects of deceased seamen must be taken in charge by the master; if he thinks fit, he may cause them to be sold at auction at the mast or other public auction; if so, an entry must be made in the log book, signed by the master and attested by the mate and one of the crew, showing the amount of money belonging to the party in question; a description of each article sold and the sum received for each; and a statement of the balance of wages due. If the vessel proceeds to a port of the United States, the master must account to a shipping commissioner within forty-eight hours. If she touches at a foreign port first, he must report the case to the United States consular officer there and conform to his instructions. Failure to observe these requirements may subject the master to a treble liability for the value of the effects involved. Unclaimed proceeds of such effects, after six years, are converted into the Treasury of the United States and become a part of a fund for the relief of disabled seamen of the merchant marine.

Where complaint is made that a vessel is unseaworthy, the master must forthwith apply to the judge of the district court for the district in which the ship may be, or if such a judge is not available, to some justice of the peace, for the appointment of surveyors; three surveyors may be then appointed whose duty it will be to carefully examine the ship and report their findings to the judge, or justice; he shall thereupon decide whether the vessel is fit to proceed, or, if not, whether the necessary repairs should be made where she is lying or whether it is necessary for her to proceed to a port of repair; the master and the crew are bound to conform to the decision. The master must pay all the costs of such survey unless it is decided that the complaint was without {67} foundation; if so, the costs, to be ascertained by the judge or justice, and reasonable damages for the detention, are payable out of the wages of the parties who complain; if it be adjudged that the vessel is fit to proceed on her intended voyage, or if after the required repairs are made the sailors or any of them refuse to continue on board, their wages may be forfeited. Similar provisions obtain when the ship is in a foreign port; there the consul is authorized to appoint surveyors or inspectors; such inspectors in their report shall also state whether in their opinion the vessel was sent to sea in an unseaworthy condition by neglect or design, or through mistake or accident; if by neglect or design, and the consular officer approves such finding, he shall discharge such of the crew as requested and require payment by the master of one month's extra wages or sufficient money for the return of the crew to the nearest and most convenient port of the United States; if the defects are found to be the result of mistake or accident, and the master shall in a reasonable time remove or remedy the cause of complaint, then the crew must remain on board and discharge their duty. Sending or attempting to send an American ship to sea in such an unseaworthy state as to make it likely that the life of any person will be in danger is a misdemeanor punishable by a fine not to exceed $1,000 or by imprisonment not to exceed five years, or both.

Should any master or owner neglect to provide a sufficient quantity of supplies for a voyage of ordinary duration to a port of destination, and thereby cause the crew to accept a reduced scale, he will be liable to penalties from fifty cents to one dollar a day to each sailor prejudiced thereby; any three or more of the crew of a vessel in deep-sea service may complain of the bad quality of the provisions or water and have a due examination made thereof, and if deficiency is found a master must remedy the same under a penalty of not more than $100; every American vessel in ocean trade shall be provided with medicines and antiscorbutics; must keep on board appropriate weights and measures and be provided with at least one suit of woolen clothing for each seaman, and a safe and warm room for the use of seamen in cold weather; they must also be provided with a slop-chest containing a complement of clothing for the intended voyage for each seaman employed, including everything necessary for the wear of the sailor and a fair supply of tobacco and blankets; the contents of the {68} chest shall be sold from time to time to any and every sailor applying therefor for his own use at a profit not exceeding 10 per cent. of the reasonable wholesale value at the port of shipment.

The statutes also contain detailed provisions as to the numbers and qualifications of the crew for vessels of various sizes and waters; also as to ratings, examinations and certificates of service; also as to wages at sea and against undue or unnecessary labor on board; while vessels are in safe harbors no sailor can be required to do any unnecessary work on Sundays or holidays, and while in port nine hours constitute a day's work.

REFERENCES FOR READING

CHAPTER VI
CARRIAGE BY SEA

The purpose of the ship is the carriage of goods and passengers and the earning of freight- and passenger-money. The underlying purpose of the maritime law is to facilitate these transactions and provide reciprocal rights for the parties engaged in them, hence the ship will have a lien on the cargo for its freight, demurrage and other charges; and, correspondingly the cargo will have a lien on the ship for any damages it may sustain by breach of the contracts of carriage. A ship is held to a high degree of care for the cargo and the cargo-owner must be prompt in his relations to the ship.

The common carrier is one who offers to carry for all who may choose to employ him. The private carrier is one who transports by virtue of a special agreement. The private carrier appears more frequently in water carriage than in land transportation. Most ships, for example, carrying bulk cargoes by special arrangement are private carriers. Most passenger ships are common carriers of passengers. Ships carrying miscellaneous or package freight, and running over regular routes, are common carriers. In general the distinction is by what they profess or offer to do,—whether to carry generally for the public, or only by special agreements.

In the case of the Caledonia, 157 U. S. 124, it appeared that the {71} vessel was chartered to transport cattle from Boston to Deptford. Sufficient fodder was provided for fifteen days, a longer period than the usual length of the voyage, being all the fodder customarily provided for such voyages. When nine days out from Boston in smooth water, the propeller shaft broke straight across in the stern tube. The breakage was due to weakening of the shaft in heavy seas on previous voyages. Its weakened and unfit condition existed when the vessel put to sea on the voyage under consideration, but the defect was invisible and could not have been detected by usual and reasonable means if the shaft had been taken out and examined. No negligence on the part of the owners was proven. Because of the breakage the voyage lasted twenty-five days and the cattle were put on short allowance of food. In consequence they were landed at Deptford in emaciated condition. They were sold in London on the first market day following their arrival. The shipper of the cattle sustained a loss due to their shrinkage in weight and to a fall in the market which occurred during the period of delay. Chief Justice Fuller in the opinion of the court reviewed many of the leading English and American cases, and held:

The warranty of seaworthiness implies that the vessel shall be fit for the particular service in which she is to engage. A vessel intended to be used in river navigation is not required to be made fit for ocean transportation. Taking into consideration the nature of the voyage, it has been said that:

She must be so tight that the water will not reach the cargo; so strong that these ordinary applications of external force will not spring a leak in her or sink her; so sound that she will safely carry {72} the cargo in bulk through these ordinary shocks to which she must every day be subjected. If she is capable of this, she is seaworthy; if she is not, she is unfit for the navigation of the river. (The Keokuk, etc. v. Home Ins. Co., 9 Wall. 526.)

The opinion just quoted had reference to a barge in tow. The Court held that the barge was considered as belonging to the tug, which had her in tow, and that the warranty of seaworthiness extended to the barge equally with the tug.

While under the act of February 13, 1893, (27 St. at L. 445, supra) the owner is relieved of liability to the cargo by reason of faulty navigation, the employment of a competent master and crew is implied in a warranty of seaworthiness and the owner is liable under the warranty if he fail to employ a competent personnel. In other words the relief from liability occurs where the owner had employed competent men, but they negligently or faultily operated the ship. Thus Justice Clifford in Germania Ins. Co. v. Lady Pike, 21 Wall. 1, said:

(The vessel) must be provided with a crew adequate in number and competent for their duty with reference to all the exigencies of the intended route, and with a competent and skillful master, of sound judgment and discretion, and with sufficient knowledge of the route and experience in navigation to be able to perform in a proper manner all the ordinary duties required of him as master of the vessel.

In the case of Barker v. The Swallow, 44 Fed. 771, a small steamer, in use in the lumber trade on the Great Lakes, took a cargo of pine boards, laden as usual on deck. She encountered a strong wind and heavy sea, causing her to roll badly so that a portion of the lumber slid off the starboard side and another portion off the port side as the vessel careened in either direction. It was conceded that it was not the usage to lash deck loads of lumber vessels with ropes or chains, but with ordinary safe loading the boards would be held in place by the frictional contact of their surfaces under the weather conditions ordinarily encountered on Lake Michigan. The libellant (owner of the lumber) contended that too much lumber had been loaded upon the deck and thereby made her top-heavy, and caused her to roll more than she would have done had she not been overloaded on deck, and that the rough weather encountered did not amount to a "tempest". The Court held

while a vessel is not liable for the loss of her deck-load when it is lost by stress of weather, or what can be properly called "a peril of the sea," yet, if she takes on so heavy a deck-load as to become top-heavy, and endangers loss of the deck-load, or puts it in peril in an ordinary wind, or anything less than a gale of wind, or such stress of weather as is clearly unusual, it should, I think, be accounted bad stowage and negligence. Overloading the vessel so as to render her unmanageable, or susceptible of becoming unmanageable, by such a wind as is shown to have prevailed on the night in question, is, I think, a manifest negligence on the part of the carrier, and such as should not acquit him of liability if the cargo is lost.

In this case there was testimony that the vessel had carried much heavier deck cargo in safety, but the Court considered that this proved no more than her good luck.

Where the particular method of stowage is determined by the {74} shipper, and damage results, the vessel is not liable for damage to cargo so stowed. A distinction is also to be noted between underdeck cargo and cargo stowed on deck. These principles are illustrated by the case of Lawrence v. Minturn, 17 How. (U. S.) 100. In that case certain boilers and chimneys were shipped aboard the Hornet and stowed on deck with the consent of their owner. The vessel encountered bad weather and began to roll gunwale deep, shipping large quantities of water, opening seams and endangering the safety of the underdeck cargo, as well as the lives of those on board. After consultation with his officers and members of the crew the master lightened ship by throwing overboard the deck cargo. The owner of the boilers and chimneys libeled the ship. In directing the libel to be dismissed the Supreme Court said:

In this connection, however, it should be noted that the foregoing decision has not been interpreted to mean that where a shipper assumes the risk of deck cargo he thereby bargains away his right to recover for loss of such cargo if the ship were inherently incapable of carrying it. Thus the court in the Royal Sceptre, 187 Fed. 224, where the shipper himself was the charterer and loaded the cargo on deck, said:

Pressed to its logical limit, the untenable nature of the argument seems very plain; for if a vessel can become unseaworthy by piling up deckload, without any liability to the owner of the same, she may capsize as soon as her fasts are thrown off. Deck cargo at shipper's risk does not mean such absolute surrender of all rights. The risk assumed presupposes proper loading for deck stowage and a seaworthy ship. It is not thought that Lawrence v. Minturn asserts any doctrine opposed to this. It speaks only of a jettison; while, if even a jettison be rendered necessary by unseaworthiness existing at commencement of voyage, the ship is liable, as is shown by the summary of decisions given in Compania De Navigacion la Flecha v. Brauer, 168 U. S. 120, 121.

In practice almost all matters growing out of a disaster are dealt with by the underwriters. Cargoes are seldom uninsured. The owner should promptly notify his insurers or brokers and tender an abandonment and the underwriters will attend to the situation which develops. If the abandonment be accepted, the shipper receives the insured value of his goods and the insurers stand in his stead as owners. The policy will also ordinarily protect against the loss if less than total and cover all charges for {76} salvage, general average, and warehousing to which the property may be subjected. The shipper and his representatives are entitled to a copy of the master's protest and all other information in regard to the disaster and also to be consulted in regard to operations for the release of the ship and cargo if they so desire.

The consignee, producing a proper bill of lading, is, of course, entitled to inspect the goods before accepting them and the ship must afford him the opportunity even if the instructions be not to deliver them until paid for. If damaged, he may decline to receive them, but if he accepts he should closely observe the provisions of his contract in regard to notice and claim for damages. Most bills of lading contain provisions limiting the time within which claims may be made and these, when explicit, are enforced by the courts. Failure to present a claim in accordance with such stipulations will usually exonerate the carrier even if the damage was occasioned by his fault or negligence.

This subject is fully discussed by the Supreme Court in the case of Constable v. National Steamship Co., 154 U. S. 51. The S. S. Egypt arrived at New York from Liverpool at 1.45 P. M. and there being no room for her at her owner's pier, was taken to the pier of the Inman Company, where she was unladen, pursuant to a permit issued by the Collector of Customs whereby the cargo was allowed to remain on the wharf for forty-eight hours upon agreement by the owners of the ship that the goods should be at {77} the sole risk of the owners of the ship who would pay the consignees the value of such cargo as might be stolen, burned or otherwise lost. Notice of the time and place of discharge was then posted upon the bulletin board of the Custom House in accordance with the usual practice, but no notice was sent to the consignee, nor did he have actual notice or knowledge of the arrival and unloading of the vessel. On the night of the day of the arrival the goods were burned on the pier upon which they had been unladen without negligence on the part of the owners of the Egypt. The bill of lading contained this provision:

The goods to be taken alongside by the consignee immediately the vessel is ready to discharge, or otherwise they will be landed by the master and deposited at the expense of the consignee, and at his risk of fire, loss or injury in the warehouse provided for that purpose or in a public store as the Collector of the Port of New York shall direct.... The United States Treasury having given permission for goods to remain forty-eight hours on wharf at New York, any goods so left by consignee will be at his or their risk of fire, loss or injury.

The Court (Brown, J.) held:

{78} The shipowners undertake that they will carry the goods to the place of destination, unless prevented by the dangers of the seas, or other unavoidable casualties; and the freighter undertakes that if the goods be delivered at the place of their destination he will pay the stipulated freight; but it was only in that event, viz., of their delivery at the place of destination, that he, the freighter, engages to pay anything. If the ship be disabled from completing her voyage, the shipowner may still entitle himself to the whole freight, by forwarding the goods by some other means to the place of destination; but he has no right to any freight if they be not so forwarded; unless the forwarding them be dispensed with, or unless there be some new bargain upon this subject. If the shipowner will not forward them, the freighter is entitled to them without paying anything. One party, therefore, if he forward them, or be prevented or discharged from doing so, is entitled to his whole freight; and the other, if there be a refusal to forward them, is entitled to have them without paying any freight at all. The general property in the goods is in the freighter; the shipowner has no right to withhold the possession from him, unless he has either earned his freight, or is going to earn it. If no freight be earned and he decline proceeding to earn any, the freighter has a right to the possession.

Where a ship does not "break ground," that is to say, does not commence her voyage at all, as in the case of the Tornado, 108 U. S. 342, in which it appeared that the vessel was destroyed by fire before sailing, the contract of affreightment is dissolved, or does not become effective, and the shipper cannot recover freight which she did not even begin to earn.

The lien for freight is a qualified one and will be lost by an unconditional delivery. The same is true of demurrage but the personal liability of the shipper or consignee will, of course, remain. The amount of freight is usually fixed by agreement and specified in the bill of lading.

So, also, are clauses in regard to demurrage. Strictly speaking, the latter can only be recovered where it is expressly reserved in the contract of carriage, but, where such stipulations have been omitted, the same result is sometimes obtained by an action for damages in the nature of demurrage on account of wrongful detention of the ship. The question of whether the ship has been unreasonably delayed or wrongfully detained is often a very confused one and its solution depends to a great extent on the surrounding circumstances. When emergency demands prevail and ports are crowded, the ship assumes some of the incidental risks of delay in obtaining and discharging her cargo, and, unless the {79} contract is plain, can hardly insist upon more than the same treatment as others in similar situations are obtaining. When disputes arise, neither party should press his position to the extent of causing further delay, as by withholding or refusing the goods. Admiralty practice abounds in opportunities to prevent unnecessary delay by bonds or stipulations and the parties should take advantage of these or risk the disfavor of the court in which their litigation proceeds.

The passenger is entitled to a reasonable amount of baggage having regard to his station in life and the character of the journey. As to articles which he retains in his personal custody the carrier is not an insurer but is liable only for negligence; the mere fact of loss creates no presumption against the carrier (Clark v. Burns, 118 Mass. 275). The carrier is liable for articles stolen from the passenger by its employees (Minnetonka, 146 Fed. 509) and the conditions and limitations as to value of baggage usually printed on the tickets are of slight value in the courts (Majestic, 166 U. S. 375).

The maritime law required a high degree of care for the protection of the passenger from personal injury. A ship must answer for such damages as might have been avoided by the exercise of unusual diligence and extraordinary skill. Although not technically an insurer, a presumption against a ship will be heavy in such cases, and ordinarily damages will follow unless it can be shown that the injury was entirely due to the passenger's own fault.[15]

Cases abound illustrative of these principles. For example the old cases of Behrens v. Furnessia, 35 Fed. 798, and the City of Panama, 101 U. S. 453, in both of which passengers were injured by falling down open hatchways, which were customarily kept closed, and the more modern case of Dempster Shipping Co. v. Pouppirt, 125 Fed. 732, where the plaintiff while on deck was struck by a beam which was being thrown overboard. In the two cases first mentioned plaintiffs recovered damages, it being considered that under the circumstances the ship was negligent in leaving open and unguarded hatchways which were customarily kept closed and over which passengers were accustomed to pass. In the case last cited plaintiff failed to recover because it appeared that he had voluntarily placed himself in dangerous proximity to boards that were being swung over the side. The law is quite fully reviewed in these cases. In the City of Panama, it was said:

In the case of Shipping Co. v. Pouppirt, the court quoted with approval the following language from Railway Co. v. Myers, 80 Fed. 361:

{83} If a passenger of mature age leaves the place which he knows has been provided for him, and, without any occasion for so doing, or to gratify his curiosity, goes to another, where the dangers are greater, or places himself in a dangerous attitude, which he was not intended to assume, or if he disobeys any reasonable regulation of the carrier, it should be held that he assumes whatever increased risk of injury is incurred in so doing.

It will be observed that this act places loss of life on the high seas in the same category as personal injuries. The suit is to be brought by the personal representative of the decedent for the benefit of the decedent's wife, husband, parent, child or dependent relative. It would appear that if there are no such persons an action could not be maintained. This would seem to exclude a right of action where the decedent leaves only creditors or heirs of more remote degree than those enumerated. Nearly all the states have statutes providing for recovery on account of loss of life at sea and these statutes have hitherto been enforced in the admiralty courts. Section 7 provides that the federal act shall not affect rights of action or remedies for death provided by state laws. The act is broad enough in terms to include a right of action for the death of seamen, but there is another statute covering such cases (see Chapter V, § 6, supra).

The act does not affect the right of the owners of a ship to limit their liability. Claims for loss of life when properly payable under the act would apparently be included among claims to be paid out of the limited liability.

The act does not enlarge the responsibility of the owners. Whether they are responsible in personam, or whether the vessel is solely responsible in rem depends on the privity or knowledge of the owner, as discussed in Chapter VIII, § 9 infra.

REFERENCES FOR GENERAL READING

CHAPTER VII
CONTRACTS OF AFFREIGHTMENT, BILLS OF LADING AND CHARTER PARTIES

A bill of lading is the document issued for carriage of goods which form only a part of the cargo; it is both a receipt and a contract of carriage.

A charter party is a contract in writing by which the shipowner lets the ship in whole or in part. It corresponds to a lease of lands or buildings. The name comes from the fact that it was formerly prepared on a card which was then cut into two parts from top to bottom (carta partita) and each of the parties retained one for production when required and thus prevented counterfeiting.

By an order dated October 1, 1920, made pursuant to the provisions of the Merchant Marine Act (see Appendix), the Shipping Board requires two certified copies of every charter or contract of affreightment made on American or foreign steam or sailing vessels leaving continental United States to be filed with the Chartering Executive Committee, 45 Broadway, New York, which will then issue a certificate of filing. Unless this is done, clearance will be refused the vessel; but where there is not time to file certified copies before sailing, a letter or telegram to the Committee, giving all details of the contract, will answer the purpose. General cargo and passenger vessels, those in ballast and those carrying cargo for owners are not subject to this regulation.

Freight is the price of the carriage of goods by sea under a bill of lading, and also the sum agreed on for the hire of the ship under a charter party.

{87} Before discussing the particular features of these contracts it will be well to observe certain elements which enter into substantially all contracts for the carriage of goods for hire. These are the warranty of seaworthiness, the obligation against deviation and the exemption of the carrier from liability on account of the perils of the sea.

In the Chapter, "Liabilities and Limitations," § 10, will be found a discussion of the Harter Act. This must be taken into consideration in connection with these subjects.

In Bowring v. Thebaud, 56 Fed. 520, it was held:

The shipowner in every contract of affreightment impliedly engages with the shipper of the goods that his ship on the commencement of her voyage is seaworthy for that voyage and supplied with a competent crew.

And the following statement of the law, from Carver on Carriage by Sea, was approved:

The warranty of seaworthiness for a voyage must be satisfied at {88} the time of sailing with the cargo. It is not sufficient that the ship was fit for the voyage while the cargo was being taken on, if she became unfit before she started. The warranty in truth appears to be a double one, viz., that the ship shall be fit to receive the cargo when receiving it and shall be fit to sail at the time of sailing.

The Court proceeded:

The warranty that the vessel is tight and fit for the employment for which she is offered,—that is, for the contemplated voyage on which she is to carry cargo,—is the very foundation and substratum of the contract of charter. The exception in a charter party as to dangers of the seas and navigation is not applicable to the perils and dangers which arise from the breach of the owner's obligation. Consequently it does not apply to the warranty of seaworthiness. Undoubtedly in cases where, under the language of the charter party, the warranty is satisfied if the vessel is seaworthy at the commencement of a voyage preliminary to her being laden, the shipowner is relieved by the exception from liability for any peril of the seas or navigation which are subsequently encountered without fault or negligence on his part.... In all of these adjudications, the question was as to the meaning of the contract of the parties. This must be decided in each case by applying the rules of interpretation to the contract on hand.

An instructive discussion of the rule with regard to deviation is found in the case of the Indrapura, 171 Fed. 929, where a vessel bound from Hong Kong to Portland, Oregon, was placed on a drydock at Hong Kong without maritime necessity and there caught fire, whereby the cargo was injured. The owners of the cargo libeled the ship for their damages, alleging that the unnecessary docking of the ship was a deviation. The Court said:

The term "deviation" in the law of shipping has at the present day {89} a varied meaning and wide significance. It was originally employed no doubt, for the purpose its lexicographical definition implies, namely, to express the wandering or straying of a vessel from the customary course of voyage; but it seems now to comprehend in general every conduct of a ship or other vehicle used in commerce tending to vary or increase the risk incident to a shipment. Thus delay in starting a shipment when unreasonable or unexcused came to be regarded as a deviation, not because the vehicle employed departed from the usual route of travel, but because the risk of shipment was changed or increased, and became, in effect, not the same as the one with reference to which the parties contracted.

And in Bulkley v. Insurance Co., Fed. Cas. No. 2,118, it was said:

The shortness of time or distance of deviation is immaterial if voluntary and without necessity, and not justified by usage.

The contract of carriage frequently purports to give the ship liberty to make deviation. This is construed strictly against the owner of the vessel. She may make only "reasonable deviation." She may call at a port lying directly on the route of her voyage, but may not go out of her way to any considerable degree, and if she does so and the shipper is damaged the exemption will not avail to protect her owner.

No owner of any vessel shall be liable to answer for or make good to any person any loss or damage which may happen to any merchandise whatsoever, which shall be shipped, taken in, or put on board any such vessel, by reason or by means of any fire happening to or on {90} board the vessel, unless such fire is caused by the design or neglect of such owner.

It will be noticed that while this statute provides complete protection against fire on shipboard it does not protect against liability for damage by fire occurring on shore. To cover this it is common to insert in the contract of carriage an exemption from loss "before loading in the ship or after unloading." Such an exception is upheld by the courts where fire is not attributable to the neglect of the owner of the ship. Such a case was that of Constable v. National Steamship Co., 154 U. S. 51, where goods were delivered on the pier of the Steamship Company and injured by fire before they were laden. The Court held that the clause in the bill of lading, excepting loss by fire "before loading in the ship or after unloading," was a valid defense.

A simple illustration of the restraint of princes clause appears in Allanwilde Transport Corp. v. Vacuum Co., 248 U. S. 377, where a sailing vessel, the Allanwilde, was chartered to the libellants for the transportation of a cargo of oil and nails to Rochefort, France. The freight was prepaid. She started on the voyage and while she was at sea the government prohibited sailing vessels departing from the United States on voyages which would carry them through the war zone. The vessel ran into bad weather and was obliged to put back to the United States for repairs. By reason of the governmental order she did not resume her voyage. The owners of the cargo libeled the vessel to recover the prepaid freight. They also presented a claim for damages. The Court held that the restraint of princes clause of the charter party was a valid defense to the suit. Thus the vessel retained the freight which had been prepaid, although the voyage did not take place, and the cargo-owners did not recover their damages.

On the other hand cases arise in which the owner has to pay dead freight to the charterers. This occurs where the compensation for the ship is a lump sum and the owner fails to load a full cargo.

Charters sometimes provide for the carrying of cargo out and back. Here the terms of the contract with reference to the outbound and homeward-bound voyage are inseparable. No freight is earned until the ship returns with the homeward-bound cargo. But if the contract can be construed so as to regard each voyage separately, the freight for the outbound voyage will be earned at destination whether the ship returns with cargo or not.

Thus in Hagar v. Clark, 78 N. Y. 45, it was held:

If it remains doubtful whether the charterers were to have sole possession and control of the vessel during the voyage or were to be constituted owners pro hac vice, then the general owners must be deemed such for their rights and authority continue until displaced {92} by some clear and definite transfer of them. The legal presumption is in favor of continuance of ownership and against any transfer of the ship to the charterer for the voyage, and is said to be so strong that, if the end sought to be effected by the charter party can conveniently be accomplished without the transfer of the vessel to the charterers, courts of justice are not inclined to regard the contract as a demise of the ship, although there may be express words of grant in the formal part of the instrument.

The master remains the agent of the owner under any contract falling short of a demise, and the owner is bound by all his acts and omissions within the scope of his authority as in the ordinary relation of carriage by sea. If the instrument amounts to a demise, the master is the charterer's agent, and not that of the owner. Bills of lading or other contracts of affreightment signed by the master bind the owner or the owner pro hac vice on the theory of the master's agency. This subject is discussed in the case of Freeman, 18 How. 182, quoted extensively in Chapter III, § 10, supra. Charter parties frequently contain a clause whereby the charterer agrees to indemnify the shipowner against any liability arising from the signature of bills of lading by the master. Probably this clause would be implied in a charter party if not expressed therein. This gives the owner of the ship a right of action over against the charterer on account of any liability to which the shipowner or ship may have been subjected at the hands of the shipper. Thus if the charter party contained covenants for the protection of the shipowner under certain circumstances and the bill of lading issued by the master did not contain these restrictions and the shipper recovered under the bill of lading against the ship or her owner, the latter in turn could recover against the charterer (Field Line v. South Atlantic Co., 201 Fed. 301).

These stipulations are valid by the law of Rotterdam (the port of departure), and of England. But the obligation of the steamer, as a common carrier, was to deliver her cargo safely in this country, at the port of New York. As against the consignee and owner here, she can not commit torts on the high seas against his property with immunity, nor justify such torts, except by some valid contract, proved according to the law of the forum. By numerous decisions of the Supreme Court of the United States, stipulations like these, inserted by a common carrier in a bill of lading, are, first, void as against public policy; and secondly, they are not evidence of any contract to that effect on the part of the shipper and consignee; because unreasonable and not having the necessary element of voluntary assent.

See also Compania de Navigacion La Flecha v. Brauer, 168 U. S. 104:

Exceptions in a bill of lading or charter-party, inserted by the shipowner for his own benefit, are unquestionably to be construed most strongly against him.

In this case the cargo consisted of cattle, and the bill of lading contained this:

{94} On deck at owner's risk; steamer not to be held accountable for accident to or mortality of the animals from whatever cause arising.... It is also mutually agreed that the carrier shall not be liable for loss or damage occasioned by ... accidents of navigation, of whatsoever kind, even when occasioned by the negligence, default or error in judgment of the pilot, master, mariners or other servants of the shipowner.

The vessel was improperly ballasted and rolled over on her beam ends. Some of the cattle were injured and in order to right the ship a number of them were thrown overboard, no discrimination being exercised between sound animals and those which had been injured. The court after laying down the general principles above quoted, further held:

The bill of lading may be both a receipt and a contract and where the shipper accepts it at the time of delivering his goods, he is presumed to have agreed to its stipulations so far as they are reasonable and just. Such a contract merges all prior and contemporaneous negotiations and precludes parole evidence to vary its terms, but the subsequent delivery of a bill of lading will not necessarily affect a prior agreement, written or verbal, for the carriage; in other words, when a contract has been already made, the carrier cannot change it by a bill of lading without the shipper's consent.

If the holder of the bill of lading is also the charterer the {95} rights and obligations of the parties will ordinarily be governed by the charter party. Where the bill of lading incorporates the charter party by reference to it, of course the holder of the bill of lading is bound by the terms of the charter party. Where the charter party provides that bills of lading are to be made subject to the provisions of the charter, the rights of the holder of the bill of lading are subject to the charter party if he had knowledge or notice of it.

A suit in which a conflict arose between a bill of lading issued by a charterer and master, and a charter party of prior date, was the early case of Gracie v. Palmer, 8 Wheat. 605. The owners of the ship America chartered her at Philadelphia for a long voyage, the whole charter hire to be paid on the return of the ship to Philadelphia, but before the discharge of cargo. The owners appointed the master. In Calcutta, the charterer, who was on board, with the master's consent, got an advance of money from Palmer & Company, a Calcutta firm, and gave Palmer & Company a bill of lading which stipulated for the delivery of the cargo free of freight to Palmer & Company's agent in Philadelphia, who were to sell the goods and collect the amount of the advance out of the proceeds, unless the charterer's drafts for the amount of the advance, drawn in Palmer & Company's favor on a Philadelphia house, should be honored, in which event Palmer & Company's agents should deliver the goods to the charterer. The master signed the bill of lading given to Palmer & Company in Calcutta, which contained the clause, "Freight for the said goods having been settled here." The drawee refused to accept the charterer's drafts, and Palmer & Company's Philadelphia agent accordingly demanded the goods on the arrival of the ship. It was held, sustaining the contention of Daniel Webster, who represented the owners, that the shipowner had a lien on the cargo for the charter hire, the Court saying:

On-the other hand, it is held that the innocent bona fide endorsee of a bill of lading, which makes no reference to the charter party, and contains nothing to put him on notice or inquiry as to the existence of the charter party, is liable for freight only according to the terms of the bill of lading.

Section 21. That when package freight or bulk freight is loaded by a shipper and the goods are described in a bill of lading merely by a statement of marks or labels upon them or upon packages containing them, or by a statement that the goods are said to be goods of a certain kind or quantity, or in a certain condition, or it is stated in the bill of lading that packages are said to contain goods of a certain kind or quantity or in a certain condition, or that the contents of packages are unknown, or words of like purport are contained in the {97} bills of lading, such statements, if true, shall not make liable the carrier issuing the bill of lading, although the goods are not of the kind or quantity or in the condition which the marks or labels upon them indicate, or of the kind or quantity or in the condition they were said to be by the consignor. The carrier may also by inserting in the bill of lading the words "Shipper's weight, load and count," or other words of like purport indicate that the goods were loaded by the shipper and the description of them made by him; and if such statement be true, the carrier shall not be liable for damages caused by the improper loading or by the non-receipt or by the misdescription of the goods described in the bill of lading: Provided, however, Where the shipper of bulk freight installs and maintains adequate facilities for weighing such freight, and the same are available to the carrier, then the carrier, upon written request of such shipper and when given a reasonable opportunity so to do, shall ascertain the kind and quantity of bulk freight within a reasonable time after such written request, and the carrier shall not in such cases insert in the bill of lading the words "Shipper's weight," or other words of like purport, and if so inserted contrary to the provisions of this section, said words shall be treated as null and void and as if not inserted therein.

This act of Congress has no application to bills of lading for goods shipped from foreign ports and the rules governing representations in such bills of lading are different. Bills of lading for shipment from foreign ports when issued by the master do not bind the shipowner of the vessel for the number of packages or quantity of goods which the bill represents as having been shipped. This is the rule which prevailed as to all bills of lading prior to the passage of the act. It is based on the theory that the implied agency of the master for the shipowner does not extend to making misrepresentations in the bill of lading, so as to make it, as against the shipowner, a receipt for goods not received. It was intended to protect the shipowner against frauds committed collusively between the master and shipper who have been known to enter into conspiracies whereby the master issued false bills of lading upon which the shipper subsequently raised money by assigning the bill.

There is another class of representations commonly found in the bill of lading relating to the condition of the goods, as that they are in "good condition" or "damaged condition." Where the goods are loaded by the shipper the effect of such statements is governed by § 21 of the Bill of Lading Act, above quoted, as to shipments in interstate commerce or from United States ports. {98} In other cases, e.g., where the carrier does the loading or where the act is not applicable, the rule is that representation made by the master in the bill of lading as to condition, bind the shipowner where the bill of lading has passed into the hands of a bona fide holder for value, the theory being that representations as to order and condition are within the scope of the master's authority.

That if a bill of lading has been issued by a carrier or on his behalf by an agent or employee the scope of whose actual or apparent authority includes the receiving of goods and issuing bills of lading therefor for transportation in commerce among the several States and with foreign nations, the carrier shall be liable to (a) the owner of goods covered by a straight bill subject to existing rights of stoppage in transition or (b) the holder of an order bill, who has given value in good faith, relying upon the description therein of the goods, for damages caused by the non-receipt by the carrier of all or part of the goods or their failure to correspond with the description thereof in the bill at the time of the issue.

This appears to protect a person to whom a bill of lading has been negotiated for value and who took it in good faith, relying {99} upon representations contained in it. A word of caution, however, is necessary. The provision is recent and has not been construed by the highest courts in a case involving a shipment by sea. The disposition of the courts has been to construe such legislation strictly. The act was intended to reverse the rule laid down in a line of decisions consistently adhered to by the Supreme Court down to the time of its passage. There can be no little doubt that any one seeking to maintain an action under § 22 of the act would have to bring himself strictly within the description of persons embraced in items (a) or (b) contained in the section.

A provision in a bill of lading exempting the carrier from loss by theft will not relieve him from liability on account of a theft committed by a person in his employ, such as an officer of the vessel or a member of the crew.

A stipulation in a bill of lading, that the carrier shall not be liable for goods of any description which are above the value of $100 per package unless special agreement is made therefor, does not mean that the liability is limited to $100 per package for such goods, but that the carrier shall not be liable for them to any amount, and is therefore void, under the Harter Act, as an attempt of the carrier to exonerate itself from all responsibility for such goods.

Charters are of various kinds. A charter party which turns over the full control and operation of the ship to the charterer is called a demise of the ship. This may be for a fixed term, or for a particular voyage. In commercial practice, however, charters for a fixed term, that is to say time charters, seldom amount to a demise of the ship, but are usually mere contracts of affreightment. A charter party for a particular voyage is called a voyage charter. In usage such a charter may amount to a demise or may not, depending on whether or not the full control and operation of the ship is surrendered to the charterer. A charter which amounts to a demise is sometimes termed a bare boat charter. Under a charter which amounts to a demise, the owner will require payment of the charter money or freight in such installments as are agreed, the maintenance of his ship in good, seaworthy condition, protection against maritime liens and the prompt payment of all her expenses, and her return to him in like condition as when taken at the termination of the contract. The charterer will require undisturbed possession of the ship so long as he is not in default and agrees, that in event of default, the owner may cancel and resume possession. Provision should also be made for insurance and stipulated value in event of damage or total loss.

The word "about" as a qualification of the charter period is sometimes inserted in time charters, as a further protection to the charterer, but it does not diminish his obligation to surrender the vessel as nearly as possible to the expiration date.

Correlative to the charterer's right of cancellation, it is usual for charter parties to contain a provision to the effect that charter hire is to be paid in advance and that in default of such payment the owner shall be entitled to withdraw the vessel from the charterer.

The so-called "cesser clause" is to the effect that "owner to have lien on cargo for freight, dead-freight, and demurrage, charterer's liability to cease when cargo shipped." The purpose of this clause is to bring the charterer's liability to an end at the loading port. In return for his exemption from liability to suit at the port of destination, he turns over to the shipowner his lien on the cargo for freight, dead-freight and demurrage.

Possession of the goods is, generally speaking, essential to the lien for freight or charter hire. It does not attach until the goods have been delivered for transportation. If, by contract, expressed in the bill of lading or otherwise, the freight is not payable until after the goods have been delivered, there is no lien, and the same is true if the freight is payable at a time and place other than those specified for the delivery of cargo. Ordinarily {104} the lien is discharged when possession of the goods is parted with; or by express waiver; or by implied waiver, such as a direction to pay the freight to another person.

It is usual to insert in time charters a clause providing for a lien for charter hire. Such provisions are valid, but they are not effective against the cargo unless the terms of the charter have been brought home to the shipper by a reference to the charter in the bill of lading, which is commonly done. To incorporate the charter in the bill of lading the reference to the charter in the bill must be explicit.

The liability of a vessel in rem for want of due diligence in the care and custody of the goods received on board for transportation is the same whether the owners of the ship remain in possession as carriers or whether the terms of the charter party are such as to constitute a demise of the vessel for the voyage, so as to render the charterers the owners pro hac vice and alone personally responsible for the transportation. The T. A. Goddard, 12 Fed. 174.

As between the shipowner and the charterer, this will be borne as the charter party provides. In the case of loss or damage to the ship, the contract again controls if its provisions are explicit. If not, the ordinary rules of bailment of personal property control. If the charter amounts to a demise of the ship, the charterer is liable, for he engages to return the ship without injury by reason of his own negligence; if not a demise, the shipowner bears the loss. For losses caused by perils of the seas or by ordinary wear and tear, without negligence on his part, the charterer is not liable in the absence of an express stipulation.

In the case of the Barnstable, 181 U. S. 464, the vessel was chartered, the charterer employing the officers and crew to navigate her, as well as providing the ship's stores, supplies and fuel, and undertaking to pay all pilotage, port charges and other expenses. The owner was to keep the vessel insured and in repair. She came into collision with the schooner Fortuna. The owners of the Fortuna libeled the Barnstable and the owners of the latter vessel called upon the charterers to defend the suit. It was conceded that the collision and the consequent damage were due to the negligent operation of the Barnstable by the officers and crew employed by the charterers to operate her. The court held that {105} the owners of the damaged schooner were entitled to look to the offending vessel for their damages. As between the owner and the charterer it was held that the charter amounted to a demise and the charterer was the temporary owner. He was therefore liable to the real owner, since he was bound to return the vessel. In the report of the argument of this case many authorities are cited showing the circumstances under which a charter party becomes a demise of the vessel.

In a contract of affreightment or charter not amounting to a demise—and this embraces time charters—the duty of navigation rests upon the shipowner. He is responsible for any damage due to negligence in navigation, even though the negligent individual had been employed by the charterer. In charters of this class the shipowner is also responsible for loading and discharging cargo. Stevedores are ordinarily regarded as being in the employ of the ship.

Until the laydays have expired there is no breach of the contract to load, but where the charterer refuses to accept the vessel {106} or provide a cargo, the owner need not keep her in readiness for delivery during all the laydays.

What constitutes readiness, or under what circumstances a ship is an "arrived ship," depends upon the terms of the bargain. Thus if the charterer requires her to reach her berth a notice given when she is in the stream will be insufficient. If she is to report for loading cargo she must have her loading apparatus ready and her cargo space available. The notice must actually reach the charterer unless he prevents it by absenting himself or his representative from the place where it is to be given. Notice should not be given on Sunday or a holiday, unless the charter expressly permits it.

In accordance with the general principle of the law of contract, laydays do not run if delay in loading or discharge is caused by the master or owner.

It is the duty of the charterer to have his cargo ready and he is liable for demurrage on account of the delay in furnishing cargo.

The charter party usually excepts Sundays and holidays from the laydays allowed for loading, but, after the expiration of the loading period (i.e., the laydays and the Sundays and holidays occurring among them), demurrage begins to be payable to the ship, and she is entitled to demurrage for Sundays and holidays as well as for secular days. This is because the work of loading in port does not usually proceed on Sunday, but a ship at sea continues on her voyage every day, so that every day's delay in departure causes an equal delay in arrival.

Charters often provide for "despatch money," which is a premium or allowance to the charterer for speed in loading. This is computed on each running day saved; that is, it is to be credited to the charterer for every day, including Sundays and holidays, occurring after the day on which the master is placed in a position to clear the vessel, up to and including the last layday, i.e., the end of the loading period. Despatch is not allowed unless bargained for in the charter.

In regard to the various obligations of the agreement, breaches by either party will either dissolve their relations or give rise to actions for damages. If nonperformance goes to the whole root and consideration of the contract, the other party may treat it as abrogated and be relieved from further obligation on his part in addition to his own claim for damages; if the nonperformance is not so vital, but may be amply compensated by damages, he will not be so relieved but must resort to his action.

The arbitration clause contained in a time charter is not enforcible in the United States.

The particular adventure being a voyage to be carried out within reasonable limits of time furnished a definite standard by which it would be determined whether the delay which actually occurred was or was not within the exception clause. There was, therefore, no inconsistency between the implied condition and the express provisions of the contract.

Termination of a charter by frustration of adventure is not applicable to time charters. Thus the taking of the ship for the use of the government does not dissolve a time charter. This was held by the House of Lords, upon a very full consideration in the recent case of Tamplin Steamship Co. v. Anglo-Mexican Products Co., Ltd., 2 A. C. 397. There a vessel was chartered for five years for a fixed sum per month for the carriage of oil as the charterers or their agents should direct. The charter party contained an exception of arrests and restraint of princes, and the charterers had the liberty of subletting the steamer on admiralty or other service. After the outbreak of the war, when the charter party had nearly three years to run, the steamer was requisitioned for an indefinite period by the admiralty, which made extensive alterations and used her as a transport. The owners contended that the charter party had been determined by the requisition. The charterers, who were willing to continue to pay the charter hire (no doubt in order to entitle themselves as temporary owners to the compensation paid by the government) contended that the charter party had not been annulled and this {109} contention was sustained by the House, which held that the interruption was not of such a character that the court ought to imply a condition that the parties should be excused from further performance of the contract and that the requisition did not determine or even suspend the charter. Earl Loreburn said:

The violent interruption of a contract may always damage one or both the contracting parties. Any interruption does so. Loss may arise to some one whether it be decided that these people are or that they are not still bound by the charter party. But the test for answering the questions is not the loss that either may sustain. It is this: Ought we to imply a condition in the contract that an interruption such as this was to excuse the parties from further performance of it? I think not. I think they took their chances of lesser interruptions and the condition I should imply goes no further than that they should be excused if substantially the whole contract became impossible of performance or in other words impracticable by some cause for which neither was responsible. Accordingly I am of opinion that this charter party did not come to an end when the steamer was requisitioned and that the requisition did not suspend it or affect the rights of the owners or charterers under it and that the appeal fails.[16]

Where the charter provides for the return of the vessel at the expiration of the term in as good condition as when taken, fair wear and tear from reasonable and proper use only excepted, and requires the hirer to make all repairs and assume liability for all loss and damage, an absolute obligation to return her is created and her total loss without any fault on his part will not exempt him from liability; he must return the ship or pay her value, and, if the charter party contains an agreement as to what that value is, that amount will be decreed by the court. In Sun Printing & C. Association v. Moore, 183 U. S. 642, the New York Sun newspaper chartered a yacht from Moore for newsgathering purposes in Cuban waters during the Spanish war. The charter party provided that the hirer was to keep "said yacht in repair and to pay all its running expenses and to surrender said yacht with its {110} gear, furniture and tackle at the expiration of this contract to the owner or his agent ... in as good condition as at the start, fair wear and tear from reasonable and proper use only excepted." It was further provided that "for the purpose of this charter the value of the yacht shall be considered and taken at the sum of $75,000." The charter party was accompanied by a paper in the nature of a surety bond given by the Sun to secure the owner against any loss or damage to the vessel in an amount not exceeding $75,000. The yacht was wrecked and totally lost. Moore sued for $75,000 as representing the agreed value of the yacht. The Sun contended that the figure represented a penalty, enforceable only to the extent of actual damage. The court sustained a recovery of the full amount without deducting the charter hire. Justice White said:

REFERENCES FOR READING

CHAPTER VIII
LIABILITIES AND LIMITATIONS

The ship is also by the general maritime law held responsible for the torts and misconduct of the master and crew thereof, whether arising from negligence or a willful disregard of duty; as, for example, in case of collision and other wrongs done upon the high seas or elsewhere within the admiralty and maritime jurisdiction, upon the general policy of that law, which looks to the instrument itself, used as the means of the mischief, as the best and surest pledge for the compensation and indemnity to the injured party.

The liability ordinarily extends to the entire ship and all the appurtenances.[17] It may include the freight money and collision damage; it does not include the insurance; and it may be diminished by statutes like the Harter Act or by special agreements in the contract of carriage or similar stipulations.

If you surrender the offending vessel you are free, just as it was said by a judge in the time of Edward III, "If my dog kills your sheep and I freshly after the fact tender you the dog you are without recourse to me."[18]

{115} This rule is in abrupt conflict with the theories of the common law and, while it has been expressed in statutory form in most maritime countries, the courts have been so far influenced by common law doctrines in its application that it does not prevail in its original integrity either in this country or in England. Congress has endeavored to restore it in the United States but the courts, so far, have declined to follow the plain language of the statute.

An illustration is found in the case of the Royal Sceptre, 187 Fed. 224, where the charter provided:

The ship is to be in no way liable for any consequences of ... perils of the sea, ... collisions, stranding, or other accidents or errors of navigation even when occasioned by the negligence, default, or error in judgment of the pilot, master, mariners, or other servants of the shipowners.

Judge Hough said:

The quoted charter provision delimits the obligations of the ship, in so far as it goes, when reasonably interpreted. If therefore the proximate cause of this loss be a peril of the sea (or river), a stranding, an error of the pilot or negligence of the master, it may be assumed that libellant cannot recover; for, without any written limitation of liability, all that the bailor-libellant could require or expect from the bailee-claimant was the use of ordinary care and skill and that expectation has been (in part) bargained away for a consideration presumably expressed in the rate of charter hire.

The original law had been passed with much difficulty and its language, as the result of compromise and concession, was subjected to much criticism as uncertain and ambiguous. The shipping interests of the country continued to decline and among the reasons assigned were the responsibility and liabilities left open or undefined by the law. About 1880, in connection with a vigorous attempt to revive the merchant marine, the entire subject received full consideration by Congress. The Act of June 26, 1884, was subsequently passed, and, expressly repealing all laws in conflict therewith, declared in a few words that "the individual liability of a shipowner shall be limited to the proportion of any and all debts and liabilities that his individual share of the vessel bears to the whole, and the aggregate liabilities of all the owners of a vessel on account of the same shall not extend the value of such vessel and freight pending." An amendment seeking to insert the condition that such debts must have been incurred without the owner's privity or knowledge was deliberately rejected. The courts, however, have declined to enforce the law according to its terms and held that Congress really intended to insert the condition as to privity or knowledge in spite of the {117} omission of the words and the rejection of the amendment which sought to insert them. The result is that the owner is still liable without limit for all obligations which arise out of matters of contract, according to the rules of the common law and in many instances of negligence on the part of his employees the same result seems to follow. His liability can not be limited where "privity or knowledge" is imputable to him and no accurate definition of these terms is yet available.

Under the present law, the voyage is the unit in respect to which limitation may be granted. Probably the shipowner may claim the benefit of the law at any time before he pays a final judgment in favor of the damage creditors, but he must account for the value of the ship as it was at the termination of the voyage on which the liability was created. The courts will not permit him to continuously operate the ship at the expense of her creditors and then finally abandon her to them loaded with the liens of many voyages. The rule is only a practical one and in special cases may work injustice to shipowners, as where ships make a continuous number of short trips between contiguous points. Part-owners are only liable according to the proportion of their shares, and the personal fault or privity of one does not necessarily implicate the others. It is not necessary that they should join in the same proceeding. The exemption is several and may be claimed by each without reference to the others.

But the liability of the owners sought to be enforced here is one resting upon their personal contract; and to such liabilities the limitation acts do not apply.

Similarly in another recent case, Pendleton v. Benner Line, 246 U. S. 353:

In the case of corporate shipowners it is said that the privity or knowledge must be that of the managing officers, but there is no definition of who the managing officers are and the term is not capable of accurate definition. The law of limitation of liability of shipowners in the United States is not now plain or simple nor is it in harmony with the general maritime law or {119} that of other commercial countries. Where the owner can prove that the loss occurred without his privity or knowledge he will obtain protection, but just what facts or ignorance of facts he must prove to reach this result can not be stated at the present time.

The general purpose of the act is understood to have been to regulate the relations between ship and cargo, so as to provide a limitation of liability, beyond that granted by the earlier statutes as to damages in general, by providing that if the owner exercised due diligence to make his ship seaworthy neither he nor his vessel should be liable for losses resulting from fault or error in the navigation or management of the vessel. The courts, however, have construed the statute closely against the shipowner and it is doubtful whether it has not rather increased his original liabilities instead of limiting them. He is still held to his warranty of absolute {121} seaworthiness at the beginning of the voyage; stipulations in the bill of lading are prohibited which tend to relieve him from liability for loss arising from negligence, fault or failure in proper loading, stowage, care or proper delivery and he is forbidden to insert any clauses lessening his common-law obligations as a carrier.

In the Carib Prince, 170 U. S. 655, the damage to cargo was caused by latent defects in a rivet, from which the head had come off, leaving a hole through which water entered and injured libellant's merchandise. The defect was due to too much hammering during the construction of the hull, causing the rivet to become brittle and weak. By reason of this defect the vessel was unseaworthy at the time the bill of lading was issued, although the owner did not know it. The bill of lading exempted the owner of the vessel from liability on account of "latent defects in the hull." The court held that the bill of lading was intended to confer exemption only to latent defects arising subsequent to sailing and consequently that there was no contractual limitation of liability, and with reference to the exemption from liability claimed under the Harter Act, said:

In the Wildcroft, 201 U. S. 378, a cargo of sugar was injured by an opening of a valve in the ship's side in such a manner that water got into the cargo. The vessel was in all respects seaworthy at the beginning of the voyage, and the court held that having discharged the duty of providing a seaworthy ship the vessel was relieved from liability arising out of an unseaworthy condition, which devolved after the beginning of the voyage and without the fault of the owners. It was emphasized, however, following the case of the Southwark, 191 U. S. 1, that the burden is upon the owner of a vessel

to show by reasonable and proper tests that the vessel was seaworthy and in a fit condition to receive and transport the cargo undertaken to be carried and that if, by failure to adopt such tests and furnish the required proofs, the question of the ship's seaworthiness was left in doubt, that doubt must be resolved in favor of the shipper, because the vessel owner had not sustained the burden cast upon him by the law to establish that he had used due diligence to furnish a seaworthy vessel.

As it emerges from the interpretation of the courts, the effect of the Harter Act seems to amount to this:

The act says to the shipowner:

1. You may make a valid bargain by which you will be exempted from liability, if you use due diligence to make the ship seaworthy at the beginning of the voyage, and some defect develops which eluded your diligence. Unless you make such a bargain, your obligation to provide a ship which is seaworthy at the commencement of the voyage is absolute, and, in no event, can you bargain to relieve yourself from using due diligence.

2. You cannot bargain away your duty and obligation to use due diligence to see that your vessel is maintained in seaworthy condition during the voyage, but you may, if you like, bargain that if you use due diligence and your ship nevertheless become unseaworthy, you shall be relieved from responsibility for damage to cargo on that account.

3. If you use due diligence to employ a competent master and {123} crew and their skill in navigation fails or the ship encounters perils of the sea and accident happens to the cargo you are not responsible for the damage. Your exemption from responsibility in this case is given by the statute and you do not need to bargain for it.

4. Your exemption from liability does not extend to damage due to improper loading and stowage.

REFERENCES FOR GENERAL READING

CHAPTER IX
MARITIME LIENS

Those who furnish supplies or fuel or provisions, or make repairs, or render services, as well as the members of the crew and officers (except the master) acquire such liens for the collection of the amounts due them. A like right or privilege accrues for the damage done through negligence on the part of the ship resulting in damage to persons or property, as by collision or injury to cargo. So these liens are divided into two classes, those ex contractu (arising out of agreements, express or implied) and those ex delicto (arising out of wrongs or torts).

The authority of the master to obligate the ship so that a lien arises has been discussed under the title "Master."

The managing owner, ship's husband, master or any person to whom the management of the vessel at port of supply is entrusted may by ordering supplies, repairs, render the vessel liable to a maritime lien. If the master be drunk or disabled and another person is discharging his duties and is in effect for the time being master of the ship, such person may create a valid lien. Thus it has been held that the vessel is bound for supplies ordered by the mate acting during the illness of the master. The vessel is also bound for supplies furnished on the order of any member of the ship's company and with the master's knowledge and acquiescence. It is customary in the administration of a large modern ship for the head of each department, e.g., the steward, chief engineer, to order supplies and for these the vessel is responsible, but only on the theory that the purchases are made with the master's authority, and if the person contracting the obligation has acted in excess of the powers delegated to him by the master, the ship will not be bound. It is incumbent on the person furnishing goods to a vessel to inquire into the authority {126} of the individual ordering the same. Moreover, if the goods ordered are greatly in excess of the vessel's needs, it is incumbent upon the supplier to know that fact and if the goods ordered, even by the master personally, are greatly in excess of the vessel's needs the ship will not be bound.

A maritime lien attaches to the offending ship only, and not to her cargo (except for unpaid freight) and this is true even though the cargo belonged to the owner of the offending ship. As was said by Mr. Justice Brown in the case of the Bristol, 29 Fed. 867:

The cargo, except for the collection of the freight due, cannot be held for the faults of the ship. There being no lien beyond freight due, no proceeding in rem lies against the cargo for damages by collision, if the freight be paid, whether the cargo belongs to the owner of the offending vessel or not; and, if arrested, the cargo must be released upon the payment of the freight due.

A maritime lien, being essentially a remedy against the vessel, may attach even in a case in which the owners are not personally responsible; as for instance, where a state pilot, in charge of a ship under a state statute which renders his employment compulsory, negligently brought the ship into collision, she was subjected to a lien for the damage done, although the pilot was in no sense the agent of the owners, and no personal liability rested upon them. The China, 7 Wall. 53.

The lien attaches only by virtue of contracts or torts which are wholly maritime in their nature. It is frequently difficult to determine the nature of a contract or tort. Thus persons digging ice and snow from around a vessel on a beach, and about to be launched did not acquire a maritime lien because the service was performed on shore. Whereas persons who floated a vessel which had been carried far ashore were held to have performed a maritime service and to be entitled to a lien. In a case in which a vessel communicated fire to a wharf to which she was made fast, it was held that the tort was not maritime, whereas, had she been in the stream and had communicated fire to another vessel in the stream, the tort would have been maritime and would have given rise to a maritime lien (Hough v. Trans. Co., 3 Wall. 20). Conversely a tort having its inception on land and completed on shipboard will give rise to a lien. As for example where a man working on board ship was injured by a piece of lumber thrown through a chute by a man working on a wharf. (Herman v. Mill Co., 69 Fed. 646).

{127} A lien arises in favor of the owners or temporary owners of a vessel upon cargo actually on board for unpaid freight and for demurrage. This is the only case in which possession of the security is essential to the existence of a maritime lien. If the cargo is removed from the ship the maritime lien is lost. In this class of cases suit to enforce the lien should be instituted before the cargo is discharged.

In the case of the Marjorie, 151 Fed. 183, above cited, a private yacht was libeled in Baltimore on account of coal furnished her in Norfolk nearly a year previously. She spent that time voyaging up and down the coast, putting in at various ports and when libeled had been laid up for the winter. She had not been in Norfolk subsequent to the occasion on which the coal was furnished. About six months after the coal was furnished she was sold to a new owner, who, finding no lien on record against her, paid the full purchase price. The Court held:

Liens for torts take precedence over all prior liens, and the later lien for tort will be preferred to an earlier if there has been an absence of diligence in enforcing it. The John G. Stevens, 170 U. S. 113, is the leading case on the priority of liens against the offending vessel for torts committed by her. Mr. Justice Gray held:

Liens arising out of matters of contract will be paid in substantially the following order:—

Salvage.

Sailors' wages and wages of a stevedore when employed by master or owner.

"Preferred mortgages" (see below).

Pilotage and Towage.

Supplies and Repairs.

Advances of Money.

Insurance premiums (where a lien).

Mortgages not preferred.

It may be regarded as the grand rule of priority among maritime liens, that they are to be paid in the inverse order of the dates at which they accrued. Liens arising on a later voyage have priority over liens of an earlier voyage, and the later in point of time which have been for the preservation or improvement of the vessel, are to be paid in the inverse order of the dates at which they accrued, the later debt being paid in full before anything is allowed to the lien of an inferior grade. The reason for this is because the loan, or service, or whatever created the later lien has tended to preserve or improve the first lien-holder in security for his lien. He is to be preferred who contributed most immediately to the preservation of the thing.

An important qualification of the rule heretofore governing the priority of maritime liens on American vessels, is made by the Ship Mortgage Act of 1920 (Merchant Marine Act, see Appendix). By this act certain mortgages which conform to its {131} provisions are called "preferred mortgages" and are made maritime liens enforceable in admiralty. In the order of priority, a preferred mortgage lien comes next after liens arising out of tort, for wages of a stevedore when employed directly by the owner, operator, master, ship's husband, or agent of the vessel, for wages of the crew, for general average and for salvage. Liens for repairs, pilotage, towage, freight and charter hire come in subsequent to "preferred mortgages."

The subjects of liens for salvage, wages, pilotage and towage, advances, mortgages, freight and charter hire are discussed under the appropriate titles in this book.

A person furnishing supplies or repairs to a vessel in the absence of her owners or temporary owners, and elsewhere than in her home port, and upon the order of the master, should inquire into the necessity for the supplies or repairs. If, upon reasonable inquiry, he finds that they are necessary, he may safely furnish them, relying on the credit of the vessel and upon his right to a maritime lien upon her. If reasonable inquiry fails to show any necessity, the supplier or repairer will not be entitled to a lien, even though the master gave the order.

In the case of the Valencia, 165 U. S. 264, the home port of the ship was Wilmington, North Carolina. She was plying between {132} New York and Maine. Coal was ordered for her in New York, not by the master, but by a steamship company doing business in New York whose relations to the vessel were not inquired into by the suppliers of the coal. If they had inquired, they would readily have learned that the steamship company was a charterer of the vessel and was bound by the charter party to "provide and pay for all coals." The coal was not paid for and the suppliers libeled the ship. In directing the libel to be dismissed the Supreme Court said:

The law is even more succinctly stated in the case of the Kate, 164 U. S. 458, as follows:

Where a charterer becomes the owner pro hac vice, as usually occurs in the case of a "bare-boat" charter, necessary supplies ordered by the master will entitle the supplier to a maritime lien under the statute, unless the charter party contains stipulations that were known to the supplier or which he could have readily ascertained, excluding such liens. Thus in the latest decision of the Supreme Court in which the act of June 23, 1910, was construed (South Coast S. S. Co. v. Rudnbach, decided March 1, 1920) a bare vessel was chartered to one Levick, the contract stipulating that Levick was to pay all charges and save the owners harmless from all liens. There was also a provision that the owner might retake the vessel in case Levick failed to discharge any liens within thirty days, and a provision for the surrender of the vessel free of {134} all liens, if Levick failed to make certain payments. The master of the ship had been appointed by the owner, but was under Levick's orders. When the supplies were ordered representatives of the owners warned the supplier that the steamer was under charter and that he must not furnish supplies on the credit of the vessel. He disregarded the warning and furnished the supplies and libeled the vessel for his lien. The Court upheld his right to the lien, holding that the warning of the owner was ineffectual because the charterer had become the owner pro hac vice, the master being his agent and not that of the owner, and that:

Unless the charter excluded the master's power the owner could not forbid its use. The charter-party recognizes that liens may be imposed by the charterer and allow to stand for less than a month, and there seems to be no sufficient reason for supposing the words not to refer to all the ordinary maritime liens recognized by the law. The statute had given a lien for supplies in a domestic port, and therefore had made that one of these ordinary liens. Therefore the charterer was assumed to have power to authorize the master to impose a lien in a domestic port, and if the assumption expressed in words was not equivalent to a grant of power, at least it cannot be taken to have excluded it. There was nothing from which the furnisher could have ascertained that the master did not have power to bind the ship.

REFERENCES FOR GENERAL READING

CHAPTER X
MORTGAGES AND BONDS

A good illustration of a bottomry bond is found in the case of the Grapeshot, 9 Wall. 129. There the libel recited that the Grapeshot was at Rio de Janeiro in April, 1858, was in great need of reparation, provisions and other necessaries to render her fit and capable of proceeding to New Orleans, the master having no funds or credit in Rio de Janeiro, and the owner not residing there and having no funds or credit there, the libellants at the request of the master loaned him $9,767.40, on the bottomry and hypothecation of the bark at the rate of 19½ cents, maritime interest; that the master did expend the sum borrowed for repairing, victualing and manning the bark to enable her to proceed to New Orleans and that she could not possibly have proceeded with safety without such repairs and other necessary expenses attending the refitting of her. Chief Justice Chase described the general characteristics of a bottomry bond as follows:

{140} The Court also quoted with approval the decision in the old case of the Aurora, 1 Wheat. 96, in which it was said:

To make a bottomry bond, executed by the master, a valid hypothecation, it must be shown by the creditor that the master acted within the scope of his authority; or, in other words, that the advances were made for repairs or supplies necessary for effecting the objects of the voyage, or the safety and security of the ship. And no presumption should arise in the case that such repairs or supplies could be procured on reasonable terms with the credit of the owner, independent of such hypothecation.

And in summarizing the conclusion reached in the case it was said:

To support hypothecation by bottomry, evidence of actual necessity for repairs and supplies is required and, if the fact of necessity be left unproved, evidence is also required, of due inquiry and of reasonable grounds of belief that the necessity was real and exigent.

These bonds are not required to be placed on record but great diligence should be employed in enforcing them so that the rights of innocent purchasers or subsequent lienors may not be impaired.

The case of Ins. Co. v. Gossler, 6 Otto 645, contains an example of a bond, which was both bottomry and respondentia. The bark Frances en route from Java to Boston with a cargo of sugar encountered a hurricane which compelled the master to cut away her mast to save the vessel and put into Singapore for repairs. Destitute of funds and without credit, the master executed a bond with maritime interest at 27½ per cent., secured upon the boat, cargo and freight. When nearing the completion of her voyage the bark was cast away on the shore of Cape Cod. She could not {141} be salved as an intact vessel, but was sold as a wreck and subsequently broken up by the purchaser in order to make use of the parts of her. Some of her cargo was saved. The Court held that the salvaged portion of the cargo and the wreck as she lay on the beach must respond to the obligation of the bond, saying that nothing but an utter annihilation of the thing hypothecated would discharge the borrower on bottomry, the rule being that the property saved, whatever it may be in amount, continues subject to hypothecation.

Unless the ship be actually destroyed and the loss to the owners absolute, it is not an utter loss within the meaning of such a contract. If the ship still exists, although in such a state of damage as to be constructively totally lost, within the meaning of a policy of insurance; ... she is not utterly lost within the meaning of that phrase in the contract of hypothecation.

Thus, the doctrine of "constructive total loss," which is important in the law of marine insurance, has no application to bottomry. It is customary in bottomry and respondentia bonds to insert a clause reserving to the lender, in case of utter loss, any average that may be secured upon all salvage recoverable.

The Ship Mortgage Act (supra) makes a sweeping exception to the foregoing rule in cases of American vessels where the mortgagee is an American citizen and where the parties fulfill certain formalities required by the Act and discussed in the next section. The Act provides that these mortgages shall be known as "preferred mortgages" and confers upon the courts of admiralty exclusive jurisdiction to foreclose them. There has yet been no judicial interpretation of this Act. Some doubt may be entertained whether it is within the power of Congress to convert ship mortgages into maritime contracts; that is to say, can Congress take a transaction, which has always been regarded as wholly foreign to the admiralty and confer upon it a maritime quality? The decision of this point is of the utmost importance and will be awaited with the greatest concern by every one interested in ships and shipping.

Here again the Ship Mortgage Act, 1920, makes a radical change in the case of "preferred mortgages" given upon American vessels to secure American investors. The Act makes the {143} lien of a "preferred mortgage" inferior to liens of prior date and liens for damages arising out of tort, for wages of stevedores when employed directly by the owner, operator, master, ship's husband, or agent of the vessel, for wages of crew, general average and salvage, including contract salvage; but superior to all other liens, such for example as repairs, supplies, towage, pilotage, etc.

Trust-deeds or mortgages securing issues of bonds are in general use where large amounts are involved. These forms are very elaborate and resemble railroad mortgages in their elaborate details. In all vessel mortgages, important provisions are those in regard to the insurance, the amount of liens which the ship may incur, the waters which she may navigate, and the rights of the mortgagee on default. It is desirable to provide for contingencies, as far as possible, by clear and definite agreements in the instruments.

To entitle a mortgage of an American vessel to an American mortgagee to the status of a "preferred mortgage" under the Ship Mortgage Act, 1920, giving its lien the superiority described in the preceding section, it is necessary that it should be recorded; that an affidavit be filed at the time of recordation to the effect that the mortgage is made in good faith and without design to hinder, delay or defraud any existing or future creditor of the mortgagor or any lienor; and that there be endorsed upon the ship's documents the names of the mortgagor and mortgagee, the time and date of the endorsement; the amount and date of the {144} maturity of the mortgage. The formalities to be observed in the creation of "preferred mortgages" are described in detail in the Act which is printed in full in the Appendix and should be observed with scrupulous exactness.

On payment of the debt, the mortgage is automatically canceled and the mortgagor is entitled to have the fact placed upon the records by the usual certificate of payment and discharge.

In the case of "preferred mortgages" under the Ship Mortgage Act, 1920, the ship's documents may not be surrendered (except in case of forfeiture or judicial sale) without the approval of the Shipping Board which will be withheld unless the mortgagee consents, and the interest of the mortgagee will not be terminated by a forfeiture of the vessel unless the mortgagee was implicated in the act which caused the forfeiture. No rights under any mortgage of an American ship, whether preferred or not, may be assigned to any person not a citizen of the United States without the approval of the Shipping Board.

Where an American ship subject to a "preferred mortgage" is sold at an admiralty sale at the suit of a lienor whose lien is inferior to that of the mortgage, the Ship Mortgage Act, 1920, provides that the vessel shall be sold free from all preëxisting claims, but the court shall, at the request of the mortgagee, the libellant or any intervenor, require the purchaser to give and the mortgagor[19] to accept a new mortgage of the vessel for the term of the original mortgage, and in that case the mortgagee shall not be paid from the proceeds of the sale and the purchase price shall be diminished in the amount of the new mortgage debt.

REFERENCES FOR GENERAL READING

CHAPTER XI
COLLISION

The question whether a collision is a subject for adjudication in admiralty is frequently one of some nicety. What constitutes a vessel within the meaning of admiralty jurisprudence has been discussed in Chapter 1, § 4.[20] While, in general, objects which come into collision must be afloat in the water to warrant recourse to the admiralty courts, and certainly must not be permanently attached to the shore, nevertheless the jurisdiction has been exercised when the collision was between a barge and a pier erected in the midst of a stream and unlawfully obstructing navigation. Atlee v. Union Packet Co., 21 Wall. (U. S.) 389. The jurisdiction has also been exercised where boats have come into collision with submerged and stranded wrecks and sunken articles.

It should be observed that vessels navigating in darkness, fog {150} or storm must take all precautions against collision which such a state of things would suggest to a prudent navigator. A vessel failing to take such precautions will be in fault in a collision. Failure to hear fog signals is not negligence. The ordinary steering and sailing rules do not apply in fog.

These rules deal with the distinctive lights required for different vessels, signals, speed, rules governing the management of sailing and steam vessels under different conditions of weather and various relative positions of vessels. While they have very often been the subject of judicial interpretation in collision cases their application belongs to the subject of navigation rather than to that of admiralty law in the present work.

The statutory rules are of the highest importance and the mere fact of a breach of any of these is prima facie (but not conclusive) evidence of negligence. The infringing vessel must satisfy the court that its violation of law not only did not, but could not, contribute to the collision.

As was said by Chief Justice Fuller in Belden v. Chase, 150 U. S. 674:

It is true that where obedience to the rules will result in collision a navigator is justified in disobeying the rule. It was held in the Oregon, 158 U. S. 186, "that the judgment of a competent sailor in extremis cannot be impugned." Cases in which disregard of the rules has been upheld as justifiable by the courts have generally been cases in which the other vessel has already infringed a rule and a situation has arisen in which obedience to the rule could only result in collision. Such exceptions, however, as was said in the Albert Dumois, 177 U. S. 240, "are admitted with reluctance on the part of the courts, only when the adherence to such rules must almost necessarily result in a collision—such, for instance, as a manifestly wrong maneuver on the part of an approaching vessel." In the John Buddle, 5 Notes of Cas. 387, it was said:

All rules are framed for the benefit of ships navigating the seas, and no doubt circumstances will arise in which it would be perfect folly to attempt to carry them into execution, however so wisely framed. It is, at the same time, of the greatest possible importance to adhere as closely as possible to established rules and never to allow a deviation from them unless the circumstances which are alleged to have rendered such deviation necessary are most distinctly approved and established; otherwise, vessels would always be in doubt and go wrong.

It frequently happens that the ship is not an absolute total loss, {152} in the sense of being completely destroyed or sunk beyond possibility of recovery, but so injured that the cost of repair will exceed the value at the time of collision; the owner may then treat her as a constructive total loss and claim from the wrongdoer the same amount as if the destruction had been complete. In other words, when the ship is so injured that a prudent business man would not repair, the owner abandons the wreck and claims a total loss. If he recovers, the title to the wreck passes to the wrongdoer.[21]

Expenses incident to the collision are also included in the ship's damage, such as the owner's disbursements in looking after his property; the cost of protest and survey; the wages and board of the crew while necessarily kept on board, the costs of superintending repairs and securing a new rating.

Loss of freight is also an item of damage.

Where both vessels are in fault the owner of the cargo may sue either or both, or as was said by Justice Clifford in the Atlas, 3 Otto 302:

In the foregoing case the owner of a cargo, lost in a collision in which both vessels were held to be at fault, libeled one of them and decreed his entire damage against the vessel which he sued. A vessel so compelled to pay the whole damage to cargo, in a case of mutual fault, is entitled to recover from the other vessel a contribution so as to equalize the loss as between the two ships.

But this important qualification of the foregoing rule must be observed: That a shipper of cargo who is prevented from recovering against the vessel on which his cargo was shipped, as for instance by his contract of affreightment, or by some rule of law, as, for example (in an applicable case), the Harter Act, cannot hold the other vessel for the entire damage but only for one-half thereof.

In the case of the Niagara, 77 Fed. 329, the steamer Niagara was in collision with the bark Hales, the Court held:

Personal injuries and loss of life are also included in collision damage. The measure here is the same as in similar matters on land.

Since we have already seen that, in a case in which both vessels are in court in the first place, the court will decree contribution, there remains only the case in which a claimant of lost cargo has brought suit against one vessel or her owner, and the other vessel cannot be reached by process of the court. Suppose that in such a case the cargo-owner gets a decree against the vessel or party defendant and for his full damage, can the vessel or the party thus mulcted maintain an independent suit for contribution against the other offending ship? It can only be said that on this point the authorities are in direct conflict; however, in the modern case of Lehigh Valley R. R. Co. v. Cornell Steamboat Co., 218 U. S. 264, it seems to be clearly inferable that in the opinion of the Supreme Court of the United States such an action is maintainable.

What has been said with respect to damage suffered by owners of lost cargo, applies equally to damages for personal injuries sustained as the result of a collision.

Where both vessels are in fault and only one is injured, the uninjured vessel must pay to the other one-half of the amount of her damage without deduction.

The cargo, being innocent, may sue both vessels or either, but if the result is that one is so compelled to pay more than its proper proportion of the total, a suit for contribution under the conditions set forth in the preceding section will lie in order to accomplish an ultimate equality. The admiralty does not recognize the common-law rule that contributory negligence prevents recovery and the same division or apportionment of damage is applied to cases of personal injury in collision as otherwise.

Since the enactment of the act of March 30, 1920, a lien arises out of the loss of life in a collision, as in the case of personal injuries.

REFERENCES FOR GENERAL READING

CHAPTER XII
TOWAGE AND PILOTAGE

The tug should be supplied with hawsers of sufficient strength to hold the tow in any weather which may be reasonably anticipated, unless the tow itself supplies them. Where the tug is given full control, it should arrange the order of towage and the distances apart. It should also arrange, by an understood code of signals, for shortening, lengthening, or casting off the lines, as exigencies of navigation may require. Vessels of heavy draft should be placed behind those of lighter draft. The speed of the tug should be such as is reasonably safe for the condition of the tow and sudden jerks and turns must be avoided. Disaster does not necessarily absolve the contract of towage. On the contrary, it is quite settled that it is the duty of the tug to continue to do all in its power to get its tow out of situations of difficulty and danger, short, of course, of sacrificing its own safety. It is not relieved from its obligation because unexpected difficulties occur and may not lightly abandon the tow to its fate. Extraordinary services under a towage contract may secure a salvage reward, but too great haste in abandoning it will impose a corresponding liability.

I am of the opinion that this claim of towage is and should be considered a maritime lien upon the schooner. It is a conceded fact in this case (and if it were not, probably the court would take notice of the usual course of maritime business in this port) that all vessels entering and leaving the port of Chicago are required by the ordinances of this city to do so in the tow of a tug; and the usual course of business is for the tug to take vessels in tow at some point outside of the entrance to the harbor, and tow them to the dock to which they are consigned. This class of service takes the place of the labor of the crew, and I can see no reason why it is not to be treated as next in rank, if not in the same order of priority, as seamen's wages. It is probably, however, more analogous in the nature of the service to pilotage, as the use of the tug dispenses with the necessity of a pilot to bring the vessel into the harbor and take her to her dock; and by such analogy ought undoubtedly to be subordinate to the seamen's wages. The court must take notice of the fact, that by the introduction of steam even sailing vessels have become largely dependent upon tugs and towing vessels to take them into and out of harbors; and this is specially necessary in a harbor like that of this city where there are long devious channels which can only be threaded by the aid of a tug, or the almost impracticable means of warping.

If the tow furnishes its own hawsers or towing lines, it must see to it that they are sufficient for all the purposes of the voyage and that they are properly fastened on board. There is an implied representation of seaworthiness in offering a vessel to be towed and the tug has the right to assume that the ship is sufficiently staunch and equipped for the voyage proposed. Thus in the case of the Syracuse, 18 Fed. 828, it was said that:

Justice requires that the continued running of old boats should be closely scrutinized and their owners should not be suffered to conceal their infirm condition, and, when accidents happen, get them repaired or recover as for a total loss, at the expense of others. The owner is bound to give notice of any infirmity about his boat. If she be not staunch and strong; and where this is not done he must be held jointly or solely responsible for such injuries as the present; according to the other circumstances of the case.

The tow must not be overloaded or improperly steered. The obligations of the contract are largely mutual and correlative for generally the tow is largely under the control of her own company and the tug is furnishing motive power and guidance only. Each party to the contract is bound to do its part towards completing it and each vessel involved must use proper skill and diligence in performing its part. The tow is not insured against damage because the tug has taken it in charge. It must not create unnecessary risk, or increase any perils by neglect or mismanagement. The obligations of good seamanship remain on the tow and it is bound to be vigilant and prompt in meeting them. In illustration of these principles one or two cases may be noticed: In the Marie Palmer, 191 Fed. 79, the four-masted schooner Marie {162} Palmer, bound from a northern port to Savannah with cargo, encountered heavy weather off Cape Hatteras and put into a North Carolina port, where it was found by a board of survey that she was leaking but could proceed under tow, and the tug Edgar F. Coney was employed to take her to Savannah for an agreed price. The vessels started on a clear day with a light breeze and had proceeded 85 miles when, shortly after dark, the schooner stranded on Frying Pan Shoals and became a total loss. The schooner, shortly prior to stranding, asked the tug if they were not too far in shore, but was answered in the negative. The navigator mistook the Cape Fear light for a gas buoy shown on the chart, although the two were entirely different in height and character, and were fourteen miles apart. There was a deviation in the tug's compass and the card for its correction was not at hand. The master of the schooner libeled the tug. The Court said:

In the case of the tug Quickstep, 9 Wall. 665, the owner of the canal boat Citizen filed a libel in rem against the tug, alleging that the tug attempted to tow too many loaded boats and in consequence of which one of the boats broke loose, and the tug while backing in an attempt to pick her up collided with and sank the Citizen.

A tug is not required to subject herself to damage in order to protect her tow. An illustration of this is found in the case of the Mosher, 17 Fed. Cas. No. 9874, from which the following is quoted:

In the Marie Palmer, 191 Fed. 79, above cited, the tug defended the suit brought by the schooner on the ground that the schooner was unseaworthy when taken in tow. The unseaworthy condition of a tow is a good defense to such a suit if that fact be concealed from the tug, but not where the condition of the tow is known to the tug.

Equally ineffective is the plea that the master of the tug did not know the extremities to which the schooner had been reduced before he undertook the towage service. The Palmer was found storm bound, at anchor, in Lookout Bight. Had she been entirely seaworthy under her sail power, the contract to tow her would have been superfluous. These facts were known to the master of the tug. But, if this were not sufficient, that officer must have taken notice of the vital fact that her storm tossed condition had been passed upon by an official board of survey, and that body, after careful examination, had found that she might proceed with her voyage under tow. It was optional with the captain of the tow boat to accept that finding, and take the tow. Certainly it put him upon notice of inquiry, and he did not hesitate to take the tow as in the condition in which the board of survey found her.

The case of the Marie Palmer, heretofore cited, is an example of negligence on the part of the tug.

Where, from the negligent operation of a tug, damage is inflicted by a tow, although the tug herself does no damage, a maritime lien for tort arises against the tug and not against the tow. In the Clara Clarita, 23 Wall. 1, the tug engaged and undertook to tow a burning vessel from her berth to a point where it was intended to beach her. While in tow the flames burst through the deck of the burning vessel and severed the hawser by which she was attached to the tug, causing her to drift upon and set fire to the libellant's schooner. Although the tug was far away when the damage was done, the court held her to be in fault because under the circumstances the burning of the hawser ought to have been foreseen and the owners of the damaged schooner were held to be entitled to a maritime lien upon the tug for the damage suffered. It was also held that the tug alone and not the owners of the burned tow should respond in damages. A tug is held not to be the agent of her tow but to occupy the position of an independent contractor. The Court said:

By employing a tug to transport their vessel from one place to another the owners of the tow do not necessarily constitute the master and crew of the tug their agents in performing the services, as they neither appoint the master of the tug nor employ the crew, nor can they displace either one or the other. Their contract for the service, even though it was negotiated with the master of the tug, is, in legal contemplation, made with the owners of the vessel employed; and the master of the tug continues to be the agent of the owners of his own vessel, and they are responsible for his acts in her navigation and management.

{167} On the other hand cases may arise in which the tow alone and not the tug is liable for injury to a third vessel or person. Thus in Albina Ferry Co. v. Imperial and S. G. Reed, 38 Fed. 614, the tug S. G. Reed had in tow the ship Imperial. The ferry boat Veto No. 2 was operated on a wire cable. The Imperial struck the cable, causing the ferry boat to sustain some damage. The tug was employed by the pilot of the Imperial for the purpose of towing the vessel and at the time of the collision was in the control and service of the ship. There was no evidence of any fault on the part of the tug or of any one employed on her. The Court said:

A case in which both tug and tow were held liable is that of the Civilta and the steam tug Restless, 13 Otto 699. In this case the tow had on board a pilot and the tug was subject to his orders. The libellant's schooner was struck by the hawser, then by the tow. The court said that the tow and tug were, in law, one vessel, and the question was, which one? It was held:

A decree was accordingly given against both the ship and the tug and the damage apportioned one-half to each with the provision that if either of the vessels should prove insufficient to pay its share the residue might be collected from the other.

An example is found in the Cayuga, 16 Wall. 177. There the tug Cayuga undertook a tow of thirty canal boats and barges from Albany to New York. The tow was faultily made up by the tug, libellant's canal boat being upwards of 1,000 feet astern of her. By reason of this faulty make-up and of the method of navigation adopted by the tug, libellant's canal boat was twice brought into collision with obstacles in the river, the first time with a lighthouse and the second with a submerged rock. The result of the second collision was the loss of the boat. The tug defended on the ground that the canal boat was unseaworthy and that her captain was negligent in cutting her loose from the tow immediately after the second collision.

Even where a contract of towage specifically provides that the tow is being conveyed at her own risk, the tug will be liable in admiralty if through the tug's negligence the tow is injured. The contract will not avail as a defense against negligence (The Syracuse, 12 Wall. 167).

In the case of the Wm. H. Webb, 14 Wall. 406, the owner of the steamship Shooting Star brought a libel in rem against the tug Wm. H. Webb for breach of contract to tow the Shooting Star {169} from Portsmouth to New York, charging negligence and mismanagement in the towage, whereby the tow was grounded on Tuckernuck Shoal, which was more than three miles out of the proper course. The court held that the tug was negligent and, therefore, liable. Mr. Justice Strong said:

It must be conceded that an engagement to tow does not impose either an obligation to insure, or the liability of common carriers. The burden is always upon him who alleges the breach of such a contract to show either that there has been no attempt at performance, or that there has been negligence or unskillfulness to his injury in the performance. Unlike the case of common carriers, damage sustained by the tow does not ordinarily raise a presumption that the tug has been in fault. The contract requires no more than that he who undertakes to tow shall carry out his undertaking with that degree of caution and skill which prudent navigators usually employ in similar services.

The action for negligent performance of the towage contract may be either against the tug or its owner by the owners or underwriters of the injured property. The damages are those which naturally follow the breach; if the tow and cargo are totally lost, the market value, at the time and place of the loss, with interest, will be allowed as in cases of loss by collision; if the loss is partial then the expenses of repairs, with compensation for loss of use, or demurrage for the time which the work of rescue and repair occupies. Where the tow is old and unseaworthy, the admiralty sometimes apportions the damages. Where both tug and tow are at fault the damages will be divided between them according to the usual admiralty rule[23] (see the Civilta and the Restless, 13 Otto 699, supra).

In the case of Sturgis v. Boyer, 24 How. 110, the ship Wisconsin, which was being towed by the tug Hector, collided with the lighter Republic in New York harbor. The owners of the lighter libeled both the tug and the tow. The owner of the tug filed an answer, setting up that the tug was merely the motive-power {171} to move the ship to the pier, that the tug and her crew were subject to and obeyed the orders of the master and other officers in charge of the ship, and prayed that in case the libellants should recover any sum against the ship and tug, that he, the owner of the tug, might have decree over against the ship. The owners of the ship admitted that she had a master and a full crew on board, but alleged that they were all under the direction and control of the master and officers of the tug. The Court was clearly of opinion that a case of negligence was made out by the owners of the lighter, and the only question in doubt was as to the relative responsibility of the tug and vessel in tow.

Thus, in the case of the China, 7 Wall. 53, where the pilot was employed under a compulsory pilot law, the Court said:

It is the duty of the master to interfere in cases of the pilot's intoxication or manifest incapacity, in cases of danger which he does not foresee, and in all cases of great necessity. The master has the same power to displace the pilot that he has to remove any subordinate officer of the vessel. He may exercise it or not, according to his discretion.

In Ralli v. Troop, 157 U. S. 386, Justice Gray said:

To the pilot, therefore, temporarily belongs the whole conduct of the navigation of the ship, including the duty of determining her course and speed, and the time, place and manner of anchoring her. But the master still has the duty of seeing to the safety of the ship, and to the proper stowage of the cargo. For instance, the duty to keep a good lookout rests upon the master and crew. And it has been held by Dr. Lushington, in the English High Court of Admiralty, that, although a pilot is in charge, the trim of the ship is within the province of the master; as well as the duty, if two vessels entangled together, to cut away part of the rigging of his vessel, when necessary, in order to avoid a collision, or to lessen its effect, because the vessel, the judge said, "was not under orders of the pilot for this purpose; she was only under the pilot's directions for the purpose of navigation; and the master, in a case of this description, is not to wait for the pilot's directions, which would tend to create great confusion and delay."

A case illustrative of the duties and responsibilities of a pilot is that of Wilson v. Charleston Pilots' Association, 57 Fed. 227. The master of the schooner Kate Aitken, which was in Charleston {176} harbor and was about to go to sea in tow of the tug Relief, applied to the Association for a pilot, and Mr. Bringloe was assigned to him. When the pilot boarded the schooner he asked the master whether he preferred the pilot to be on the tug or on the schooner. It was the custom to put the pilot on the tug, unless the master wished otherwise. The master expressed his preference that the pilot should be on the tug. The Court remarked in passing "that if disaster occur because the pilot is on the wrong boat he cannot excuse himself by reason of any preference of the master. He is employed because of his supposed knowledge of all that is necessary to take a vessel to sea." The pilot took his place on the tug and gave direction with regard to the position of the hawser. He took his position on the top of the house and constantly directed the movements of both tug and schooner. Nevertheless the schooner went aground. The Court said:

Where the law requires the ship to take a pilot on board and to surrender the navigation of the ship to him, the master and owners are exempt from responsibility for damages resulting from the mismanagement of the pilot. The reason is this: The laws which establish such compulsory pilotage are intended to secure, as far as possible, protection to life and property, by supplying a class of men better qualified than ordinary mariners to take charge of ships where navigation is attended with unusual difficulty on account of local conditions; the master, however well qualified, is compelled under penalty to abdicate his authority in favor of the pilot, and, if so, it is unjust that either he, or the owner, should be personally answerable for the errors of an official in whose selection he had no choice. The responsibility of an owner for the acts of his servant rests upon the presumption that the owner chooses the servant and gives him orders which he is bound to obey and that responsibility ceases when the law supplants the owner's choice. Therefore neither the master nor the owner can be successfully {178} sued at common law, or personally in the admiralty, for damage done by a compulsory pilot. This was held on a full consideration of the American and English authorities by Justice Gray in Transportation Co. v. La Compagnie Générale Transatlantique, 182 U. S. 406, which is very instructive in this connection.

The ship, however, is liable for such damage, although in charge of a compulsory pilot. The reason is this: By American admiralty law, the ship is treated as a personality for many purposes and, in whosesoever hands she may lawfully be, is treated as the actual wrongdoer, irrespective of any question of agency or employment. Thus, in this country, the ship by whose fault a collision has occurred may be sued directly, although in charge of a compulsory pilot at the time the disaster occurred. In England the rule is different and the ship is not liable if the owner could not be sued. The leading American case on this point is that of the China, 7 Wall. 53. The China, while under the control of a compulsory pilot, was in collision with the brig Kentucky, which was wholly free from blame. On a review of the English and American authorities the Court (Swayne, J.) held:

REFERENCES FOR GENERAL READING

CHAPTER XIII
SALVAGE AND GENERAL AVERAGE

The ingredients of a salvage service are, first, enterprise in the salvors in going out in tempestuous weather to assist a vessel in distress, risking their own lives to save their fellow-creatures, and to rescue the property of their fellow-subjects; secondly, the degree of danger and distress from which the property is rescued—whether it were in imminent peril, and almost certain to be lost if not at the time rescued and preserved; thirdly, the degree of labor and skill which the salvors incur and display, and the time occupied. Lastly, the value. Where all these circumstances concur, a large and liberal reward ought to be given; but where none, or scarcely any take place, the compensation can hardly be denominated a salvage compensation: it is little more than a remuneration pro opere et labore (The Clifton, 3 Hagg. Adm. 14, 48 [quoted with approval in Cope v. Drydock Co., 119 U. S. 625]).

General Average is also the price of safety under different circumstances. It is the contribution required of the parties interested in a maritime venture to compensate the sacrifice of a part for the safety of the rest. The typical instance is the jettison of cargo in order that the ship may be saved; the loss is equalized by a general average.

It was held by the Supreme Court of the United States (The Jefferson, 215 U. S. 130) that where a vessel, laid up in drydock in a shipyard for repairs, was saved from destruction by a fire, which was raging in the shipyard, by tug boats in the stream which played streams of water from the stream upon the endangered vessel, it was a case of salvage. The Court after remarking that a maritime lien for repairs existed against a vessel in drydock, said:

There is no distinction between the continued control of admiralty over a vessel when she is in a drydock for the purpose of being repaired, and the subjection of the vessel when in a drydock for repairs to the jurisdiction of a court of admiralty for the purpose of passing upon claims for salvage services, by which it is asserted the vessel, while in the dock, was saved from destruction.

Work of this nature is often performed by contract, by vessels and corporations equipped and organized for the purpose. This fact does not militate against their claims as salvors in proper cases but the courts will not hesitate to modify the contract if they consider it unjust. The case of the Leamington, 86 Fed. 675, {183} contains a note giving many instances of amounts awarded under various circumstances.[25]

As a general thing salvage is not allowed in an amount exceeding 50 per cent of the value of the thing salved, although there are cases where as high as 75 per cent has been allowed. There was an old rule, "50 per cent for a derelict." This rule has been departed from in many cases. The amount to be awarded lies largely in the sound discretion of the trial court which takes into consideration all of the elements of labor, risk, value, time, expense, and any other features that may enter into the case. It is practically impossible to lay down rules for determining the amount to be awarded. The books, however, say that the award should not be so great that the salvage service becomes of no use to the owner of the thing salved. For example if the charges and expenses of the owner come to 50 per cent of the value of the thing salved, an award of 50 per cent will not be made to the salvors, no matter how perilous, arduous and meritorious their work may have been to the owners. Sometimes the award when computed on percentage of the value of the salved property is very small, in some cases only about 4 per cent. These are cases where the service performed was not extensive or highly meritorious and the salvage property was of large value, so that the amount of money received by the salvors was considerable, though the percentage was small. The amount awarded to salvors is not always calculated on the basis of a percentage or proportion of the value salved; in many cases the trial court fixes a flat figure which it thinks the service worth.

A pilot acting within the line of his duty, however he may entitle himself to extraordinary pilotage compensation as distinct from ordinary pilotage for ordinary services, cannot be entitled to claim salvage, but a pilot is not disabled from becoming a salvor if he performs salvage services outside the scope of his duties. He stands in the same relation to the property as any other salvor (Hobart et al. v. Drogan, 10 Peters 108).

In the Reward, 1 W. Rob. 174, a distinguished English judge laid it down that,

Mere towage service is confined to vessels that have received no injury or damage; and mere towage reward is payable in those cases only where the vessel receiving the service is in the same condition she would ordinarily be in without having encountered any damage or accident.

Where the salving vessel is a steamer the owners' share of the salvage is larger and that of the crew proportionately smaller than if she were a sailing vessel or other craft because of the superior efficiency of a steamer in salvage work. Credit and compensation for the superior character of the salving vessel must go to her owners. In Transportation Co. v. Pearsall, 90 Fed. 435, there is a discussion of salvage distribution. In that case three tugs, all belonging to the same owner, had salved a steamer which had gone ashore. The owner of the tugs affected a settlement with the owners of the steamer and received $13,000 in full of all demands. A libel in personam against the master and owner of the tugs was brought by the engineer and fireman of the third, each claiming a share of the $13,000. The court decided that the owner of the tugs was entitled to two-thirds of the salvage award, and ordered the remaining one-third to be distributed among the {186} masters and crews of the tugs proportionately, awarding the engineer $500 and the other libellants $200 apiece, these awards being in proportion to their wages. The court remarked that under the rule once prevailing in admiralty the owners of the salving vessel could not receive more than one-third of the award unless there were unusual circumstances of peril to the salving vessel, that that rule had been modified in the direction of greater liberality to steamships, citing cases in which the share of the salving vessel had been fixed at three-fourths and even four-fifths. The Court said:

An examination of the cases will show that there is no fixed rule with regard to the proportion in the salvage award allotted to the owners of the salving vessel. Most frequently salvage services are rendered upon a voyage, in the absence of the owners, and when the salving vessel is under the charge of, and is controlled by, the master and crew. As salvage is awarded for the encouragement of promptness, energy, efficiency, and heroic endeavor in saving life and property in peril, the claims of the master and crew who exhibited these qualities must meet the most favorable consideration. At the same time an allowance is made for the owners whose property has been imperiled. But when the owners direct the service, or when the peril encountered is chiefly that of the salving vessel, with no proportionate peril to the crew, an award to the owners is more liberal.

It was also said that the making of distribution in proportion to the wages is a "just and uniform rule in all ordinary cases."

Where salvage is performed by successive sets of salvors,—for instance, if one set of salvors gets a ship off a reef, and a second set takes her into port—the award is apportioned between the two sets, special consideration being shown to the first set of salvors because they made the work of the second possible.

It is true that the salvage service was in one sense entire; but it certainly cannot be deemed entire for the purpose of founding a right against all the claimants jointly, so as to make them all jointly {187} responsible for the whole salvage. On the contrary, each claimant is responsible only for the salvage properly due and chargeable on the gross proceeds or sales of his own property pro rata. It would otherwise follow that the property of one claimant might be made chargeable with the payment of the whole salvage, which would be against the clearest principles of law on this subject.

Where a ship is saved and unable to continue her voyage and carry out her contracts of affreightment, the freight is one of the things of value saved, but in determining the value of the freight saved for the purpose of assessing a salvage award against it, "the freight to be considered is only such proportion of the freight earned by the entire voyage as the distance at which the salvage service was rendered from the port of departure bears to the whole voyage." The Sandringham, 10 Fed. 556.

In cases of salvage, the party founds himself upon a meritorious service, and upon an implied understanding that he brings before the court, for its final award, all the property saved, with entire good faith, and he asks a compensation for the restitution of it uninjured and unembezzled by him. The merit is not in saving the property alone, but it is in saving and restoring it to the owners. However meritorious the act of saving may have been, if the property is subsequently {189} lost, and never reaches the owner, no compensation can be claimed or decreed.

In the case of Barnard v. Adams, 10 How. (U. S.) 270, the ingredients of general salvage were thus stated:

Ordinarily a jettison of cargo carried on deck does not give rise to general average, although deck cargo is not exempt from contributing its share of the average for other cargo jettisoned for its safety. But deck cargo will be entitled to participate in general average where the goods are of such character as it is customary in the trade to carry on deck; also where the other cargo-owners have expressly consented that it be carried on deck; also usually in coasting and river voyages. The cases excluding deck cargo from average have generally arisen out of sailing vessels and it may be that the rule should be confined to sailing vessels.

After a voluntary sacrifice of part of the adventure, and a consequent escape of the rest from imminent peril, the owner of the ship, or in his absence, the master as his agent, has the duty of having an adjustment made of the general average, and has a maritime lien on the interests saved, and remaining in his possession, for the amount due in contribution to the owner of the ship; and the owner of goods sacrificed has a corresponding lien on what is saved, for the amount due him (Ralli v. Troop, 157 U. S. 386).

The work is usually done by an adjuster and often requires a high degree of professional skill. He determines what losses are to be adjusted, what goods contribute, how the values of the receiving and contributory interest are estimated, and when and where the adjustment should be made. He must necessarily bring to this work a special acquaintance with maritime law and the current decisions of the courts on the subject as well as a practical acquaintance with the values involved and the methods of business which they represent. He is, however, merely an expert {192} without any judicial authority and his work is subject to review by the parties in interest. In practice, the shipowner places in his hands the documents from which the necessary facts can be ascertained; the protest of the master and mariners showing the circumstances under which the sacrifice was made and the manifest of the cargo to show the goods involved will be essential; in addition there may be the report of surveyors as to the condition and value of the ship and other property involved and such other evidence as the adjuster requires to have before him, the valuations of hull, cargo, freight and all other items involved in the contribution, excepting the wages of the master and crew, their personal effects and the apparel, jewelry and baggage of the passengers.

CHAPTER XIV
CRIMES COMMITTED AT SEA

Crimes committed at sea are those accomplished upon the high seas or within the jurisdiction of the admiralty, which extends over all navigable waters. Such crimes are punishable by the United States so far as Congress legislates on the subject and otherwise by the particular sovereignty within whose jurisdiction the offense is committed.

{196} Thus if a vessel fails to carry the wireless equipment prescribed by law a fine is imposed upon the master and is a lien upon the ship enforceable by law in admiralty. The statute governing the equipment of vessels with radio telegraph apparatus is given under § 11 infra. Innocent cargo is not involved in the forfeiture of a guilty vessel, and where the owner and master of a vessel is innocent she will not usually be forfeitable by reason of the guilt of the cargo.

The sending, or attempting to send to sea, of a vessel so unseaworthy as to be likely to endanger life, is a misdemeanor for which the person guilty is to be punished by fine or imprisonment, or both (Act of December 21, 1898, § 11), unless he is able to prove either that he used all reasonable means to insure her being sent to sea in a seaworthy state, or that her going to sea in an unseaworthy state was under circumstances reasonable and justifiable.

Chapter 12 provides for the punishment of piracy; maltreatment of crews; incitement of revolt or mutiny; seamen laying violent hands on commanders; abandonment of mariners in foreign ports; conspiracy to cast away vessels; plundering vessels in distress; holding false lights; attacking vessels with intent to plunder; breaking and entering vessels; destruction of vessels at sea; robbery on shore by pirates; arming vessel to cruise against citizens; piracy under color of foreign commission; piracy by aliens; voluntary surrender to pirates; plotting or corresponding with pirates and selling arms or intoxicants to any aborigines in Pacific Islands. The punishments provided for the offenses in these two chapters are generally severe but in harmony with what experience has shown to be appropriate for the crimes dealt with.

Besides these provisions, the Code, in Chapter 10, deals with the slave trade and peonage; in Chapter 2, with offenses against neutrality; and in Chapter 9, with offenses against foreign and interstate commerce, such as carrying explosives on passenger vessels.

Title LIII Merchant Seaman (7 Comp St. §§ 8380-8391) contains various provisions in respect of offenses and punishments of seamen; desertion; willful disobedience; assaults on officers; damaging the vessel; embezzlement of stores or cargo; smuggling; drunkenness; carrying sheath-knives; unlawful boarding; soliciting seamen as lodgers; and corporal punishment are there dealt with.

Inasmuch as barratry must be directed against or in fraud of the owner, it cannot be committed by a master who is a part owner of the ship, either generally or for the voyage. Thus in the old case of Marcadier v. Ins. Co., 8 Cranch 39, the master abandoned the voyage at an intermediate port for his own emolument and advantage, and, as a result, a quantity of cargo was spoiled. It was contended that he had been guilty of barratry. The Court found, however, that he was the owner of the ship and therefore incapable of committing the offense. In Ins. Co. v. Coulter, 3 Peters 222, it was held that gross negligence might be evidence of barratry:

And when it is considered how difficult it is to decide where gross negligence ends and ordinary negligence begins, and to distinguish between pure accident and accident from negligence, we cannot but think that the British courts have adopted the safe and legal rule in deciding, that where the policy covers the risk of barratry, and fire be the proximate cause, they will not sustain the defense that negligence was the remote cause.

This case contains a quaint quotation from the doctrine of Malynes "whose book unites the recommendations of antiquity, good sense and practical knowledge." The passage follows:

Barratrie of the master and mariners can hardly be avoided, but by a provident care to know them, or at least the master of the ship {200} upon which the assurance is made. And if he be a careful man, the danger of fire above mentioned will be the less for the ship; boys must be looked unto every night and day. And in this case let us also consider the assurers; for it has oftentimes happened, that by a candle unadvisedly used by the boys, or otherwise, before the ships were unladen, they have been set on fire and burnt to the very keel, with all the goods in them, and the assurers have paid the sums of money by them assured. Nevertheless, herein the assurers might have been wronged, although they bear the adventure until the goods be landed; for it cometh to pass sometimes, that whole ships' ladings are sold on shipboard, and never discharged.

CHAPTER XV
WRECKS AND DERELICTS

It is interesting to note, in connection with this statute, two Articles of the Rooles of Oléron,—

The Act of Congress and the ancient articles are both occasioned by the persistent notion of loss of title by shipwreck and the right of people on shore to appropriate what they can of the property at risk.

CHAPTER XVI
WHARFAGE AND MOORAGE

These principles were invoked in the case of Onderdonk v. Smith, et al., 27 Fed. 874; where a scow and her cargo were sunk in consequence of being punctured by a spile which projected from the bottom of the slip directly under the place where the scow had taken her cargo. The respondent enjoyed the exclusive privilege from the owners of using the pier and the adjoining slip for shipping their coal and to that extent, although they were neither owners or lessees, had control and occupation of the premises. "They assumed the duty toward those whom they invited there for the transaction of business not to expose them to hazard from any defects in the condition of the premises known to themselves or which, by the use of reasonable diligence, should have been known." Their superintendent knew of the existence of the spile and they were, therefore, chargeable with notice, because about three weeks before the accident in suit another boat had been struck by the same spile. The Court said:

In Smith v. Burnett, 173 U. S. 430, a schooner while moored in berth at a wharf on the Potomac River for loading, was sunk by a submerged rock within the limits of the berth at the wharf, which the master was invited to take, the obstruction being unknown to the master and having been assured by the owners of the wharf, through their agent, that the depth of water in the berth in front of the wharf was sufficient and that the berth was safe for the loading of vessels. Chief Justice Fuller, discussing the English and American authorities said:

Although a wharfinger does not guarantee the safety of vessels coming to his wharves, he is bound to exercise reasonable diligence in ascertaining the condition of the berths thereat, and if there is any {212} dangerous obstruction, to remove it, or to give due notice of its existence to vessels about to use the berths. At the same time the master is bound to use ordinary care, and cannot carelessly run into danger.

Piers or landing places and even wharves, may be private, or they may be in their nature public, although the property may be in an individual owner; or, in other words, the owner may have the right to the exclusive enjoyment of the structure, and to exclude all other persons from its use; or he may be under obligation to concede to others the privilege of landing their goods, or of mooring their vessels there, upon the payment of a reasonable compensation as wharfage; and whether they are the one or the other may depend, in case of dispute, upon several considerations, involving the purpose for which they were built, the uses to which they have been applied, the place where located, and the nature and character of the structure. Undoubtedly, a riparian proprietor may construct any one of these improvements for his own exclusive use and benefit, and, if not located in a harbor, or other usual resting place for vessels, and if confined with the shore of the sea or the unnavigable waters of a lake, and it had not been used by others, or held out as intended for such use, no implication would arise, in a case like the present thus the owner had consented to the mooring of the vessel to the bridge pier.

Accordingly it was held that:

{213} When it became obvious that the necessary effect of the trespass, if suffered to be continued, would be to endanger and injure or perhaps destroy the pier, the peril of the vessel imposed no obligation upon the defendants to allow her to remain and take the hazard that their own property would be sacrificed in the effort to save the property of the wrongdoers. On the contrary, they had a clear right to interpose and disengage the vessel from the pier to which she had been wrongfully attached, as the only means in their power to relieve their property from the impending danger. They had never consented to incur that danger, and were not in fault on account of the insufficiency of the pier to hold the vessel, because it had not been erected or designed as a mooring place for vessels in rough weather, and it was the fault of the plaintiffs or their agent that the vessel was placed in that situation.

The proprietor of a private wharf may fix any rate he pleases for the use of such a wharf and those employing it, after due notice of the charge, will make themselves liable to pay it. This rule of private property, however, applies only to the purely private wharf and slight circumstances may be sufficient to give it a public character. It has, indeed, been held that where the wharf constitutes the only means by which the people of a community can reach the water and have the benefit of the means of commerce and navigation thereon, the structure is necessarily impressed with a public interest and may not be monopolized to the exclusion of others.

Injuries are often sustained by docks and wharves when vessels make fast thereto in stress of weather and can not leave without exposing themselves to destruction. The rule is that the shipowner may not save his own property at the expense of the wharf-owner but must compensate him for the damage done by his ship, although the master had no alternative but to remain as he did. Vincent v. Company, 109 Minn. 456, is a decision in point, and Dutton v. Strong, 1 Black 23, should be read in the same connection.

The vessel, being at anchor in a proper place and otherwise complying with law, is not liable for damages sustained by collision with it, but, obviously, will have a strong case against the ship which runs her down. She ought not to anchor in an exposed situation, except in cases of necessity, and then only as long as the necessity prevails.

The Court quoted with approval the language of Spencer on Marine Collisions:

In cases like these, the admiralty is inclined to follow the rule of the famous donkey case (Davies v. Mann., 10 M. & W. 546), where the owner of the animal had fettered its forefeet and, in that helpless condition turned it into a narrow highway; then the defendant's wagon came along very fast and carelessly and the donkey was crushed; the defendant had to pay for it because, if the driver of the wagon had been decently careful, the consequences of the negligence of the owner of the donkey would have been averted. Any vessel not "under way," as when aground, moored, or at a wharf, is in the position of anchored vessel and subject to similar rights and liabilities.

CHAPTER XVII
ADMIRALTY REMEDIES

One of the reasons for the continued vitality of the admiralty lies in the efficiency of the remedies which it affords. If it were not for these it is quite possible that it would long since have been absorbed by the common law as was the law merchant many years ago. Parties having rights to enforce will usually resort to the admiralty in preference to any other court if the selection is open to them. This is not so much by reason of any difference in the law as in the methods of its application. Admiralty remedies may be divided into proceedings, in rem, in personam, and under the Limited Liability Act.

American courts of admiralty—that is to say, the United States district courts—take jurisdiction in rem not only of domestic vessels but of ships flying foreign flags, and of controversies originating on the high seas and in foreign waters. The test is, whether the subject matter is within admiralty jurisdiction. The admiralty courts are not bound to take jurisdiction of controversies {219} between foreigners, but they may exercise it in their discretion and frequently do so, applying the principles of international law or the lex loci contractus. In the exercise of their discretion to take jurisdiction of suits between foreigners, the courts give consideration to the wishes of consuls of the nations involved, though they are not bound to do so. The United States courts have jurisdiction in rem for supplies furnished American ships in foreign ports and foreign ships in American ports. They may in their discretion take jurisdiction of claims for wages by foreign seamen against foreign ships in American ports, and, of course, of claims of American seamen against foreign ships. The principle upon which the court is to determine whether to exercise jurisdiction is whether the rights of the parties would best be served by retaining the cause or remitting it to the foreign court.

Foreign governments sometimes own or operate merchant vessels, and a serious question arises, as yet undetermined by the Supreme Court, whether such vessels are, like naval vessels, exempt from maritime liens, or whether they are subject to the process in rem of the admiralty courts. By the act of March 9, 1920, Shipping Board vessels are immune from arrest, but provision is made for suit in personam against the government. Vessels of the Panama Railroad, although it is a government agency, are subject to suits in rem.

The owner must establish his status with the court by filing a claim. This is a formal statement on oath of his title to the property. If he desires to contest the libellant's demand, he must file an answer to the libel. The cause is then at issue and will be disposed of by the judge in due course. The time will depend largely on the parties.

APPENDICES

APPENDIX I
SUMMARY OF NAVIGATION LAWS OF THE UNITED STATES

Jasper Yeates Brinton[33]

SUMMARY OF THE NAVIGATION LAWS OF THE UNITED STATES

While the navigation laws of the United States are in many respects the most advanced and progressive of any in the world, the form in which they exist is far from satisfactory and is a serious handicap on their usefulness. They are voluminous and complicated and in much confusion. Even on comparatively simple topics it is often impossible to distinguish the law of to-day from the law of yesterday.

The reason is not hard to find. It lies in the fact that these laws represent one of the oldest bodies of statute law in the books, and for well over a century have been subject to a steady piecemeal amendment, but with little or no attempt at revision or codification. The result is that on almost every subject there is a bewildering overgrowth of laws—law after law covering and partly modifying, but seldom explicitly repealing, the older law, which thus remains as a stumbling block to even the expert reader.

A complete revision is urgently needed and has been undertaken by the Shipping Board. In the meantime, it is of course desirable that knowledge of the laws as they exist shall be made as conveniently accessible as possible and the summary herewith is presented as a contribution towards that end. It does not pretend to be either complete or exhaustive, but merely undertakes to cover very generally the principal topics, with a somewhat more extended reference to the practical aspects of ship registry as embodied not only in the laws but in the regulations and practices which have grown up around them.

Most of the statutes which have been summarized herein except the recent Merchant Marine Act (Jones Bill) and other laws of this year will be found in the 600 page compilation of the Navigation Laws (1919) prepared with the thoroughness and accuracy to be looked for from any work issued under the direction of the present Commissioner of Navigation. It may be procured from the Superintendent of Documents, Washington, at the cost of one dollar. Subject to the obvious limitations on any compilation which must necessarily include a large body of conflicting and practically obsolete statutes, the work is in every respect admirable. The volume, however, is confined to {228} statute law, and for much of the practical information covering those branches of operation of ships involving the agency of the customs service, including the documentation of vessels, reference must be had to the Customs Regulations, the last edition of which was published under date of 1915, and which may also be secured from the Superintendent of Documents.

In addition to these two principal compilations reference should also be made to the series of Rules and Regulations of the Board of Supervising Inspectors, issued by the Steamboat Inspection Service, Department of Commerce, to the various publications of the Department covering the Rules of the Road, the International Rules, the Inland Rules, and the Pilot Rules, respectively, together with the notable series of pamphlets issued by the Department from time to time, covering such special subjects as the Measurement of Vessels, the Comparative Study of Navigation Laws of the Maritime Nations, and other similar topics. So far as the writer is aware, however, there is no volume which contains any general summary of the whole body of our navigation laws.

I. Ship Registry

Therefore, if a ship is actually owned by American citizens, her nationality is American, and she is entitled to the protection accorded to American property all the world over, regardless of the fact that {229} for any reason she may not be entitled to, or may not desire to take, American registry.

The rule as to the use of a flag is somewhat different and more strict in England. Under the Merchant Shipping Acts the use of a British flag on board a ship owned either in whole or in part by persons not lawfully qualified to own a British ship, subjects the vessel to forfeiture. But there are no such provisions in the law of the United States and questions as to the improper use of the flag of this country upon vessels have not arisen, although occasional diplomatic negotiations have been undertaken to prevent the use of the American flag in foreign countries. Generally speaking it may be said that the United States has been extremely lax in regulating the use of her flag.

In 1892, a special act was passed granting American registry to certain foreign-built vessels of the American Line under conditions as to the building of other vessels, but this was a special and very limited proviso.

The Panama Canal Act of 1912, however, made a radical change in our policy and opened American registry to foreign-built vessels not over five years old, owned by American citizens, although denying to these vessels the privilege of entering the coasting trade.

The Ship Registry Act of 1914 went a step farther and removed the limitation as to age, and also authorized the President to suspend, as to these vessels, the rigorous provision that the watch officers of {230} all vessels engaged in foreign trade should be citizens of the United States. This authority was exercised by the President and many such vessels have been registered.

In 1915 a law was passed to facilitate the transfer of American-owned vessels from foreign to domestic registry by a repeal of the prohibitory duties on such vessels on condition that before leaving an American port they should secure the necessary documentation.

The Shipping Act of 1916, as amended in 1918, and again by the Merchant Marine Act of 1920, further enlarged the scope of the registry laws by providing that vessels (whatever their previous history) purchased, chartered or leased from the Board by citizens of the United States may be registered, or enrolled and licensed, or both enrolled and licensed, as vessels of the United States and entitled to the benefits and privileges of such documentation.

The various classes of vessels now entitled to registry under these laws may be thus divided:

(1) American-built vessels which have always been American-owned;

(2) American-built vessels formerly owned by foreign owners, but subsequently purchased by American citizens;

(3) Vessels captured in war lawfully condemned and owned by citizens;

(4) Vessels forfeited for breach of the laws;

(5) American-built vessels sold by the government to citizens, and foreign-built vessels bought or chartered by the government and sold to citizens;

(6) Vessels whose documentation is authorized by special act;

(7) Wrecked vessels purchased by citizens and repaired in American shipyards on proof that the repairs are equal to three times the appraised salved value; this is a special permission which is a dead letter except as to the coastwise trade, as wrecks can now be admitted to registry for foreign trade regardless of the amount of repairs;

(8) Vessels for foreign trade wherever built, wholly owned by citizens of the United States;

(9) Vessels purchased, chartered or leased from the Shipping Board by citizens of the United States.

Barges, lighters and other boats provided with sails or internal motive power, if falling within these classifications, are entitled to documents, as also barges and boats without sails or internal motive power engaged in the Canadian trade or employed upon the marine waters of the United States or engaged in the carriage of passengers.

The following classes of vessels are not within the provisions of the registry laws and therefore require no documents:

(1) Boats or lighters not masted, or if masted and not decked, employed in the harbor of any town or city and not carrying passengers.

(2) Barges or canal boats or boats without sails or internal motive power employed wholly upon canals or on the internal waters of the state and not engaged in trade with contiguous foreign territory and in carrying passengers;

{231} (3) Barges or boats without sail or motive power, plying on inland rivers or lakes of the United States, also not engaged in trade with contiguous foreign territory and in carrying passengers;

(4) Vessels plying waters wholly within the limits of the state having no outlet into a river or lake on which commerce with foreign nations or among the states can be carried on.

Originally the license, which is applicable only in the coasting trade, was an altogether separate document from the enrollment, the form of each document being provided by statute. In 1906, however, the two documents were consolidated into one, so far as enrolled vessels were concerned, leaving the license only to be required in the case of smaller vessels. As the law now stands these documents are distinguished as follows:—

Registry is required, for vessels engaged in the foreign trade and in the trade with our insular possessions, except Hawaii and Porto Rico, and is permitted to vessels engaged in the domestic trade under certain requirements as to entry at the Custom House when laden with certain commodities, etc. There is but a single form of register.

Enrollment of License is required for vessels of twenty tons or over when engaging in the coasting trade. Separate forms are issued for the coasting trade or fisheries, and for yachts.

License alone is required for vessels between five and twenty tons when likewise engaged in the coasting and fishing trade.

Vessels of less than five tons may not be licensed, nor may pleasure vessels of less than sixteen tons be documented except under special instructions from the Department of Commerce.

In general form and purpose these documents closely resemble each other and further consolidation and simplification is badly needed.

In addition, under an act passed in 1917, the Shipping Board was given authority in its discretion to permit vessels of foreign registry, and foreign-built vessels which had been admitted to American registry under the Act of 1914, already referred to, to engage in coastwise trade during the war, and for three months thereafter.

{232} This latter act has been in terms repealed by the Merchant Marine Act of 1920, but with the proviso (§ 22) that all foreign-built vessels admitted to American registry, which were owned on February 1, 1920, by citizens of the United States, and all foreign-built vessels owned by the United States on the date of the signing of the Act (June 5, 1920), when sold and owned by citizens of the United States, may engage in the coastwise trade so long as they continue in such ownership.

The general policy above outlined is supplemented by a further proviso of the Merchant Marine Act (§ 27) forbidding the transportation of merchandise between points in the United States, or such of its possessions as are subject to the operation of the coastwise laws, in any other than documented vessels of the United States, owned by citizens of the United States, except in the case of the vessels to whom the privilege has been extended by the provisions above referred to.

Practically each step in the process of securing the ship's papers is marked by the production or issuance of one or other of a number of important documents. These steps are as follows:

Prior to 1866 the penalty for the violation of this requirement was the severe one of forfeiting her status as a vessel of the United States. To-day the penalty is a fine of $30 upon every arrival of the vessel in a port.

In addition to this, every steam vessel of the United States is required to have her name conspicuously placed in distinct, plain letters not less than six inches high, on each outer side of the pilot house, and in case the vessel is a side-wheeler, then also upon the outer side of each wheel-house. "Double-enders" may place the names on the parts corresponding to the bow and stern; and on vessels whose sterns do not allow sufficient space for lettering, the letters may be placed on adjacent parts so as to conform as closely as possible to the requirements, and provided always that the home port shall be marked at one end of the vessel.

Scows, barges and other vessels with square bows may be marked on the bow instead of the side, where such marking would be speedily worn out by chafing against other vessels.

The "home port" as required to be marked on the stern of the vessel, may mean either the port where the vessel is documented, or the place in the same district where the vessel was built, or where one or more of the owners reside. From this it follows that the home port need not be the port of documentation, for, as already noted, the law is that the vessel must be registered in the district which includes the port to which the vessel at that time belongs, such port being defined by law as that at or nearest to which the owner, or if there be more than one, the managing owner of the vessel, usually resides.

Questions as to what is a vessel's "home port" frequently arise in connection with contracts for repairs and supplies and liens arising from the same. As will be seen the port of registry and the home port may often be quite different places.

It is also required that the owner's affidavit shall name the master of the vessel together with a statement that the master is a citizen, with a note of the means whereby he acquired his citizenship. The person thus named by the owner is thereby deemed her master for all legal purposes, regardless of the question of his competency, or as to who actually commands the vessel, but no name of a master who has not the necessary license to command a vessel of the class in question will be accepted by the Collector. Thus, while in the case of a barge any citizen may be named as the master, or one citizen may be named as master for any number of barges, in case of a tug or larger vessel requiring a licensed master, the person named as master must be licensed and qualified to perform this duty. This, however, is entirely irrespective of whether he has in fact assumed or does in fact assume actual command over the vessel. For such purposes the command may be a nominal one.

The importance of this document is illustrated by the fact that the penalty for a statement knowingly false is a forfeiture of the vessel, or of its value, to be recovered from the person by whom the oath was made.

It will be observed that no reference has been made to a bill of sale. This is because no such bill is required by law to be produced at the first registration. In fact the only bill of sale recognized by statute is a bill which itself contains a copy of the ship's document, and therefore such a bill could not be produced before the registration had actually taken place. All that is required in the first instance, therefore, is the Carpenter's Certificate with the affidavits as to ownership, etc. These documents are taken as establishing the ownership, and laying the foundation for registry in a particular name. However, the bill of sale may be actually in existence, having been given either by the builder himself or by some one who had subsequently acquired title to the vessel before her documentation. In such case the bill of sale should be produced to complete the chain of title, and will be retained at the Custom House with the Carpenter's Certificate as a link in the chain. But it will not be recorded, for the law makes no provision for the recording of bills of sale except in the sense of transfers of documented vessels, as hereafter referred to.

It should be borne in mind that the penalty for failure to effect such a new registration is the severe one that the vessel shall cease to be considered a vessel of the United States. No time limit for the accruing of this penalty, however, has been fixed by law.

In case of such new registration the process is the same as above outlined, but omitting the earlier steps relative to the measurement and marking of vessel, official number, etc., all of which are certified to by the previous document.

In the case of the sale of the vessel, it is of course the bill of sale that furnishes the foundation for the transaction, which must be accompanied by the owner's and master's oaths as already outlined.

The bill of sale, as the all-important and indispensable document, must be made to comply strictly with the requirements covering registry, the most important of which is that it will recite at length the last previous certificate issued to the vessel. This proviso is of great importance in England. The inaccurate recital of such a certificate voids the sale entirely. In the United States the penalty is {237} not so severe, but still severe enough, as the ship is deprived of her American character.

The bill of sale when produced is recorded in the office of the Collector of Customs in accordance with the law hereinafter referred to, and is returned to the owner producing it, as in the case of any other bill of sale which the owner may desire to have recorded.

It frequently happens that it becomes necessary to secure new documents for a vessel which is distant from the port where her new owners reside, and where it is desired that she shall be documented. In such case it is often impractical at the time to secure the outstanding papers for surrender. The practice is to secure certified copies of the same either from the office of the Collector where they were issued or from the office of the Commissioner of Navigation at Washington, giving the necessary oath for the production of the original documents when they come to hand.

It also frequently happens that the certified copies, or indeed sometimes the original documents themselves, do not bear upon their face, as they should, a notation as to the date of expiration of the certificate of inspection of the vessel. In this case some evidence of an outstanding inspection must be produced to the Collector. The simplest plan is to secure, by wire if necessary, a statement from the appropriate Collector of Customs that such an inspection is outstanding.

The law is very strict on the surrender of the old documents upon the issuing of new ones, as also in those cases where a ship loses her right to continue as a vessel of the United States. The old law, passed in 1792, provided for the giving of a bond by the ship's husband or the acting or managing owner, varying in amount according to the tonnage of the boat from $400 to $2,000, guaranteeing that the registry should be used only for the vessel for which it was granted, and should not be sold, lent or otherwise disposed of, and that in case the vessel were lost or taken by an enemy or otherwise prevented from returning to the port, the certificate, if preserved, should be delivered up within eight days of her return to port, etc. The present law substitutes for this bond a penalty of $500 and declares the Certificate of Registry to be void after a violation of any of the requirements as to its surrender.

It frequently happens that a document is lost or wrongfully withheld from the possession of the owner. In this case, upon the oath of the master or other person having charge of the vessel, a new document may be issued either temporary in form, if the vessel is out of her own port, or permanent, if she is in her own port.

II. Recording of Bills of Sale

The present law on the subject of recording bills of sale is included in the general mortgage provisions of the new Merchant Marine Act, under which it is provided that no sale of a vessel shall be valid {238} against a ship unless the bill of sale is recorded by the Collector of Customs in an official register, which is required to show

It is also provided that no bill of sale can be recorded unless the interest of the grantor in the vessel is stated, also the interest sold, nor unless the bill has been acknowledged before a notary public or other officer authorized to take acknowledgements. In the case of a change in the port of documentation, no bill of sale may be recorded at the new port unless a certified copy of the record of the vessel at the former port is furnished by the collector of that port.

III. Preferred Mortgages Under Merchant Marine Act

The law in regard to ship mortgages is highly technical and reference only will be made here to the general provisions of the Merchant Marine Act which makes far-reaching changes in the existing system in an effort to give added value to mortgage security on a ship, a form of security which heretofore has been of very limited value on account of the subordination of the mortgage, which is not a maritime contract, to all maritime liens, whether arising out of contract or tort.

The present law gives to a duly recorded preferred mortgage priority except as to (1) liens arising prior to the recording of a mortgage in strict conformity to the provisions of the act; (2) liens for damages arising out of tort; (3) liens for wages of stevedores when employed directly by the owner, operator, master, ship's husband or agent of the vessel; (4) liens for wages of the crew of the vessel; (5) liens for general average; (6) liens for salvage, including contract salvage; and (7) court costs and expenses.

If a mortgage covers a ship of over 200 gross tons the material facts regarding it must be endorsed on the ship's papers. There must also be filed an affidavit that the mortgage was made in good faith, without the intent to delay or defraud. It must appear that the mortgagee is a citizen of the United States and that the mortgage does not stipulate that the mortgagee waives its preferred status. If the mortgage includes property other than a vessel it must provide for the separate discharge of such property by the payment of a specified amount, and if it includes more than one vessel it must similarly provide for the separate discharge of each vessel on the payment of a specified amount, in default of which, the court, in a suit on the mortgage, is to determine the proportionate charge.

Two certified copies of every preferred mortgage are to be delivered by the collector to the mortgagor, who is required to use due diligence to retain one copy on board the vessel, and to cause it and the ship's documents to be exhibited by the master to any person {239} having business with the vessel which may give rise to a maritime lien or to the sale of the vessel. Upon request, the master is required to exhibit to such person the ship's documents and this copy of the mortgage. Upon request of the mortgagee, the mortgagor is required to disclose in writing, before the execution of any preferred mortgage, the existence of any maritime lien prior to the mortgage, that is known to the mortgagor, and, without the consent of the mortgagee, the mortgagor is forbidden, after the execution of the mortgage and before the mortgagee has had reasonable time to record the mortgage and have the necessary endorsements made, to incur any obligations creating liens on the vessel other than those for wages, for general average or for salvage.

The law permits the preferred mortgage to bear any rate of interest agreed to by the parties. It provides severe penalties upon the master for failing to exhibit the ship's documents or the copy of the mortgage, when demanded, and permits local inspectors to suspend or cancel the master's license for any such violation. As to the mortgagor who fails to make disclosure of liens already referred to, or who incurs new liens with attempt to defraud, the law provides a maximum fine of $1,000 and imprisonment for two years, and makes the mortgage then immediately payable. It also subjects the collectors of customs and the mortgagor to personal liability for loss occasioned by their failure to perform their duties under the act and opens the federal courts to such suits.

Under the same act jurisdiction of all suits to foreclose a preferred mortgage is vested exclusively in the District Courts of the United States. Authority is also given to bring suit in personam in the admiralty, in the United States District Courts, against the mortgagor.

The surrender of the documents of mortgaged vessels without the approval of the Shipping Board is prohibited, and the Board is directed to withhold such approval unless the mortgagee consents to the surrender. By resolution of the Board this law is interpreted as not applying to cases in which owners merely renew licenses or change documents incident to change of trade and where the ownership remains the same.

Elaborate provisions are also to be found covering the formal procedure in case of sales of mortgaged vessels, together with a provision that no rights under a mortgage shall be assigned to any person not a citizen of the United States without the approval of the Board, and that no vessel shall be sold in a suit in the admiralty to any person who is not a citizen.

The legality of the provisions conferring upon the federal courts the right to enforce mortgage liens which are of a nonmaritime character, is much debated and must await final decision by the Supreme Court. If the court should decide against the legality of these provisions serious and difficult questions will be presented as to whether the act as it now stands will be effective to give preferred {240} status to such a mortgage, under the radically different procedure which must then be resorted to.

The act also revises the law on the subject of the creation of maritime liens for necessaries. It provides that persons furnishing repairs, supplies, towage, etc., on order of the owner or an authorized agent shall have a maritime lien on the vessel without being required to prove the credit was given to the vessel; defines the persons who are to be presumed to have authority from the owner to procure repairs, etc., including the agents of a charterer; and permits the waiving of such liens by those furnishing the supplies or services, subject to certain existing specified rules of law.

IV. Change of Name

The American law has always been very strict in regard to changing the names of vessels. Such change can only be made by the Commissioner of Navigation, and if made by the master or owner or agent of the vessel subjects the vessel to forfeiture. Since 1881 the Secretary of the Treasury, and later, the Commissioner of Navigation, has been authorized to permit the change of names of vessels "duly enrolled and found seaworthy and free from debt." Under this law it became necessary to secure a special act of Congress, which was frequently done, to change the name of a mortgaged vessel. To cure this defect the law of February 19, 1920, which took effect thirty days after its passage, provides for a change of name by the Commissioner of Navigation upon compliance with regulations issued by him.

All that is required in the first instance is a duplicate application by the owner, addressed to the Commissioner of Navigation and forwarded to him through the Collector of Customs at the home port of the vessel, which is required to state the change desired, the reasons in support of it, place of build, official number, rig, gross tonnage, and the owner's name. It must also include a detailed list of liens of record from all custom houses where the vessel has been previously documented, together with the consent in writing of the mortgagee or other beneficiary under each lien to the change desired. To this the Collector of Customs, forwarding the application, must add his certificate as to liens on record in his office, and must also state the date and place of last inspection, a requirement which presupposes the presentation to him of satisfactory evidence of the vessel's inspection, that is, either the original certificate, or a certified copy of it, or a statement from the office of the Commissioner of Navigation at Washington that such a certificate is outstanding. In the case of vessels not usually inspected, as, for instance, barges, inspectors are authorized to make special examinations at the owner's expense and to furnish a certificate of the seaworthiness of the vessel, the object of course being to prevent old and unseaworthy vessels from concealing their condition and antiquity by a change of name.

{241} After the application has been passed by the Commissioner and permission has been granted, it is required that the change shall be published in a daily or weekly paper nearest to the port of documentation in at least four consecutive issues, the cost of procuring the evidence and of publication to be paid by the applicant. The permission for change is not effective until this fee is paid. Upon its payment the issuance of a new document is then required, which presupposes the production, as in other cases, of the owner's affidavit, and of the master's affidavit, as already explained.

The Collector thereupon records the change of name in his prescribed reports and the transaction is completed.

Vessels formerly documented and which have been sold to the United States and resold to citizens, must be documented under the old name and official number, but vessels never before documented and sold by the United States to citizens, may be redocumented under any name selected that is approved by the commissioner.

In forwarding the application for change of name the Collector of Customs is required to submit his recommendations giving any reasons for or against the change. The usual reasons in support of a change are a desire on the part of the company to carry out some established policy in the naming of its vessels, or a desire to shorten or lengthen a name, as the case may be.

The fee required is prescribed by law upon a sliding scale from $10 to $100, according to gross tonnage, the former figure being for vessels of 99 gross tons and under, and the latter for vessels of 5,000 gross tons and over.

V. Entry and Clearance

Whether or not a vessel is required to enter and clear depends, first, upon whether she is registered, and second, upon her tonnage and the service in which she is engaged.

All vessels under registry (as distinguished from vessels enrolled or licensed) are required to enter and clear at every port, except when bound from a point in one state to that of an adjoining state.

If not registered the question depends in the first instance upon the size of the vessel. The law, as inherited from the early days, when smuggling was frequent in small vessels, and it was considered important to keep them under close supervision, makes a distinction between vessels under twenty tons and those above that tonnage.

If under 20 tons (and properly documented, that is licensed) and laden wholly with American goods, or with foreign goods in packages as imported not exceeding $400 in value, or of aggregate value not over $800, they may trade from a customs district in one state to a customs district in the same or an adjoining state, without entering or clearing. But if over twenty tons, such vessels are permitted to trade, without entering or clearing, from one customs district in the same Great District to another in the same Great District, or {242} from a State in one Great District to an adjoining State in another Great District: Except as thus provided all vessels engaged in the coasting trade must enter and clear on their arrival at, or departure from, each port.

The five Great Districts referred to have been defined as follows and should not be confused with the customs collection districts:—

It is worth noting, however, that enrolled vessels which are not required to enter and clear may do so, if they desire for any purpose to have a record of their entrance and their clearance. This might occur in the case of a vessel intending to undergo extensive repairs and which might desire such a record to secure a rebate of insurance premium.

In the case of vessels in the foreign trade or coming from one Great District into another, and which are required to be registered, the law requires the surrender and filing of manifests, bill of health and crew list. When these formalities have been complied with, the vessel is posted in the Custom House as entered. The manifest is produced to the boarding officer and includes the original manifest issued at the foreign port as well as a certified copy. The crew list is the list issued by the Collector of the last port of clearance from the United States, the Collector having retained the original sworn to by the master, and having furnished the master with a certified copy. Bills of health should have been secured from the American consular office at the last port of touch, but bills are not required from ports where there is no such officer. The ship's register is deposited in the Custom House and obtained before clearance.

In the case of the clearance of a vessel in the coastwise trade, and which is under registry, or which for any other reason desires a clearance, the master is required to produce a coasting manifest to the Collector. Upon making affidavit to this document the necessary coastwise clearance and permit is issued. If, however, as in the case of tugs, there is no cargo to be manifested, a coastwise permit is issued upon affidavit by the master that the vessel contains no cargo whatever other than sea stores.

In the case of vessels bound to foreign ports the documents take the form of the customary foreign manifest, which is followed by the official clearance in the form familiar to the export trade for a hundred years.

VI. Shipping Articles

Shipping articles are required in both the foreign and in the coastwise trade, but with certain important differences.

{243} In the foreign trade the articles, which must be in government form, are required to be signed before a Shipping Commissioner. This, however, does not apply to trade between the United States and the British North American possessions and the West Indies, and Mexico. The nature of these articles is sufficiently familiar to require no comment. Generally speaking the articles must contain the following particulars:—

In the coasting trade the law merely requires that every master of a vessel of fifty tons or over, bound from a port in one State to a port in any other than a port in an adjoining State (with the exception of voyages from the Atlantic to Pacific ports, which are included under foreign trade) shall make an agreement in writing with his seamen declaring the voyage or term of time for which the seaman is shipped. This agreement may be signed before a Shipping Commissioner, but this is not compulsory. The agreement required in the coasting trade requires only the voyage, or term of time for which the seaman is shipped.

Question has been raised as to whether the requirement as to written articles applies to cases where the "adjoining State" is reached by a waterway running through other States, as, for instance, a voyage from New York to Philadelphia. It seems clear, however, that the law should be strictly interpreted, according to its terms, and that articles would not be required on such a voyage.

In neither case does the law provide a limit in the matter of length of voyage. In England shipping articles are frequently for long periods of a year or more. Our practice is more limited. Clauses for one or more continuous voyages are commonly found {244} with a provision for the termination of the contract by authority of the master, or any member of the crew, upon twenty-four hours' notice.

A provision of law which sometimes occasions difficulty is that which permits a seaman discharged "without fault on his part justifying such discharge" and without his consent, before the commencement of the voyage or before one month's wages are earned, to receive a compensation of one month's wages. This question, like all other questions relating to wages, comes up in the first instance before a Shipping Commissioner, and in the hands of a competent commissioner there should seldom be any difficulty in determining whether the discharge was or was not due to the fault of the seaman or to his inability properly to perform his duties.

The right to overtime is not provided for by statute, and before the war was not generally recognized. In July, 1919, however, an informal agreement was made between the Shipping Board and the steamship association and the unions, under which this right to claim overtime is recognized, provided it is covered by special contract.

VII. Licensing and Qualifications of Officers

The law requires that masters, chief mates, second and third mates, if in charge of a watch, engineers, and pilots of all steam vessels, and the masters of sailing vessels of over 700 gross tons, and of other vessels over 100 gross tons carrying passengers for hire, shall be licensed and classified by the boards of local inspectors, and imposes a penalty of $100 for employing an unlicensed officer or for an unlicensed person to serve as an officer. These several boards of inspectors are under the direction of a Supervising Inspector General appointed by the President, and who is at the head of a Steamboat Inspection Service, and are further under the supervision of ten supervising inspectors, to each of whom is assigned general supervision of the work of inspection in a particular district. The law imposes large discretion upon the local inspectors in the examination and licensing of officers, limiting the licenses to a period of five years, and giving the inspectors authority to suspend licenses on proof of bad conduct, intemperate habits, incapacity, inattention to duties or a willful violation of inspection laws.

It is specially forbidden for any state or municipal government to impose on pilots any obligation to secure a license in addition to that issued by the Federal government.

One of the most important functions of the local inspectors is that which concerns the investigation of collisions and complaints of incompetency or misconduct committed by licensed officers. For this purpose the inspectors have power to summon the witnesses, to administer oaths and, upon hearing had after reasonable notice in writing to the alleged delinquent, to suspend or to revoke his license, if satisfied that he has been guilty of misbehavior, negligence or unskillfulness, {245} or has endangered life. Appeals from the decision of the local inspectors may be made to the supervising inspector.

Where, however, the supervising or local inspector finds a licensed officer on board a vessel under the influence of liquor to such an extent as to unfit him for duty, or when a licensed officer uses abusive language to an officer or insults him while on duty, the local inspector is required to revoke the license of the offending officer without further trial or investigation.

The rules of the board classify vessels according to the general character of their trade, as

Qualifications for the officers properly vary according to these three classes of service, to which is added a number of other special classifications, as, for instance, ferry steamers on rivers, passenger barges on rivers, etc.; or in the case of engineers, as, for instance, condensing river steamer and noncondensing river steamer. These requirements are set forth in full detail in the Regulations of the Steamboat Inspection Service, with which all officers should be familiar.

Certain minimum requirements in the case of deck officers have been prescribed by statute, the latest law being that of March 11, 1918, which with certain minor exceptions, provides for one licensed master for every vessel; for vessels 1,000 gross tons or over, three licensed mates, and for vessels between 200 and 1,000 tons, two licensed mates; for vessels between 100 and 200 tons, one licensed mate. The inspectors, however, are permitted to increase these requirements if they consider the vessel not sufficiently manned for safe navigation.

The same law of 1918 prohibits officers from assuming deck watches on leaving port unless they have had at least six hours off duty within the twelve hours preceding sailing; and also prohibits licensed officers on both ocean and coastwise vessels from doing duty exceeding nine hours of any twenty-four while in port, or more than twelve hours of any twenty-four while at sea, except in case of emergency endangering life or property.

VIII. Qualifications of Seamen

Before the passage of the Seamen's Act in 1915, there were no statutory requirements as to the ability or experience of the crew, other than the general requirement that the vessel should be properly manned. This act, however, presents a body of highly stringent requirements. Its principal requirements may be summarized as follows:

IX. Nationality of Officers and Crew

X. Wages

The Seamen's Act requires that on coasting voyages, wages shall be paid to every seaman within two days after the termination of the agreement under which he shipped, or at the time of his discharge if he should be discharged before the expiration of the agreement; and that on foreign voyages wages shall be paid within twenty-four hours after the discharge of the cargo, or within four days after the discharge of the seaman, whichever shall first happen. The law further provides that a seaman is entitled in every case to be paid at the time of his discharge a sum equal to one-third of the balance of wages then due him. This proviso, however, is seldom observed in practice, nor is it insisted upon, as it would in general be impracticable for wages to be paid at the moment of discharge.

The question of payment of a certain portion of wages on demand, which is also covered by the Seamen's Act and earlier acts, has received considerable revision in the Merchant Marine Act. Under this law it is provided that every seaman on a vessel of the United States may receive on demand of the master one-half of the balance of his wages earned at every port where the vessel loads or delivers cargo. This protection may not be waived by contract, but is subject to the proviso that the demand shall not be made before the expiration of, nor oftener than once in, five days, nor more than once in the same harbor. Failure on the part of the master to comply with this demand releases the seaman from his contract and entitles him to full payment of wages earned. At the end of the voyage the seaman is entitled to the remainder of his wages according to the provisions of the Seamen's Act, which also provides that notwithstanding the release, which is required to be signed before the Shipping Commissioner at the time of the seaman's discharge, the proper court may set aside the release upon good cause shown. The provision of the Merchant Marine Act is specially made applicable to the case of seamen on foreign vessels while in the harbors of the United States, and the courts of the United States are opened to such seamen for its enforcement.

Seamen discharged by a consul in a foreign port on account of the voyage being continued contrary to agreement, or unseaworthiness of vessel, or bad provisions, or cruel treatment, are entitled to one month's extra wages and transportation to the United States. Seamen discharged at a foreign port at the request of the master, and not on account of neglect of duty, are entitled to employment on a vessel agreed to by the seaman and to one month's extra wages.

Seamen discharged before commencement of voyage without fault, are entitled to one month's additional wages, and all seamen are entitled to two days' extra wages for each day's delay in payment at end of voyage.

The laws also contain elaborate and beneficial provisions for the recovery of their wages by seamen through proceedings in the courts.

Seamen are disqualified by law from signing away their lien upon a vessel for wages; as also their rights to participate in salvage. It is to be noted that the seaman's right to a share in salvage, in the case of the saving of human life, on the part of a seaman who has taken part in the services rendered, is expressly conferred and protected by statute. Failure, unless unavoidable, to give help to persons at sea, in danger of being lost, is also made a serious criminal offense.

XI. Watch and Watch and Work-Day

Before the passage of the Seamen's Act there were no legal requirements as to hours of labor at sea, though long established custom had divided the deck crew into two watches and the engine crew into three watches, with certain variations in this plan in special trades. Under the Seamen's Act it is now provided that on merchant vessels of over 100 tons, except those engaged in river and harbor navigation, the sailors must be divided into at least two watches, and the firemen, oilers and water tenders into at least three watches, which are to be kept on duty successively for the performance of ordinary work, incident to the sailing and management of the vessel.

Seamen may not be shipped to work alternately in the fireroom and on deck, nor may those shipped to work on deck be shifted to the fireroom, or vice versa, subject to cases of emergency, in the judgment of the master or other officer. These provisions, however, do not prohibit the master or other officers from requiring the whole or any part of the crew to participate in fire, lifeboat and other {249} drills when the vessel is in a safe harbor nine hours, inclusive of the anchor watch, which is a legal day, but in such case no seaman may be required to do unnecessary work on Sundays or on New Year's, Fourth of July, Labor Day, Thanksgiving Day and Christmas, provided that this does not prevent the dispatch of the vessel on regular schedule or when ready to proceed on her voyage.

XII. Provisions for Crew

For allowing the supply of provisions to be reduced below the legal scale during the voyage, except for unavoidable causes, compensation must be paid to every seaman according to the time of its continuance and in accordance with the scheduled allowances fixed by law.

XIII. Personal Injuries to Seamen and Recoveries for Death

Prior to the passage of the recent Merchant Marine Act (1920) recovery by a seaman for injuries received by him in the service of the ship was subject to the maritime law under which (except in case of the unseaworthiness of the vessel, where full recovery might be claimed) the seaman was entitled to, but only to, his maintenance and cure, and to wages so long at least as the voyage continued, regardless of his own negligence (unless it amounted to willful misconduct) or of that of any other person. Where his contract extended beyond the voyage or there was fault on the part of the ship, recovery of wages was allowable even beyond the termination of the voyage.

This liability could not be enlarged or diminished by any law of the states on the subject of employer's liability or workmen's compensation.

The Seamen's Act of 1915 undertook to enlarge the protection of seamen by providing that in suits to recover damages for injuries received on board a vessel, or in its service, seamen "having command," e.g., masters, etc., should not be held to be fellow servants with those under their authority, but this was held not to affect those cases covered by the general rule of the maritime law above stated, under which the fellow servant question is immaterial.

A more successful effort at extending the seaman's right, however, was made in the recent Merchant Marine Act, which permits any seaman who suffers injury in the course of his employment, to maintain, at his election, an action for damages at law, with the right of trial by jury, and in such case to have the benefit of the United States statutes modifying or extending the rights of railroad employees in analogous cases.

The same act also covers the question of actions for the death of seamen, giving to their personal representatives the right to sue for damages at law and the benefit of a trial by jury, and the similar benefit of the laws covering actions for death in the case of railroad employees.

This provision, it is observed, is in sharp contrast, and perhaps in some conflict with the provision of an act passed at the same session of Congress, on March 30, 1920, giving a general right to maintain {251} actions for all deaths occurring on the high seas by some wrongful act or neglect. This law, which in its broad terms covers also the case of seamen, permits suits to be brought in the admiralty courts and fixes the recovery at the amount of pecuniary loss sustained by the persons for whose benefit suit is brought. It further provides that in such action the fact that the decedent has been guilty of contributory negligence is not to be considered a bar to recovery, but is to be taken into consideration by the court in fixing the degree of negligence and in reducing the recovery accordingly.

A discussion of the technical questions involved in the relations of these two acts is beyond the scope of this summary.

XIV. Offenses by Seamen

Offenses by seamen are punishable under the laws of the United States, generally, when committed on the high seas, or on any waters within the jurisdiction of the admiralty courts, or on lands under the exclusive jurisdiction of the United States. The list of crimes covers those familiar to the criminal law, such as murder, manslaughter, assault, rape, robbery, arson, larceny, forgery, receiving stolen property, etc. Other offenses peculiar to marine life may be noted as follows.

Willful disobedience is punishable under the Seamen's Act by being placed in irons until the disobedience ceases, and, on arrival in port, by forfeiture of wages, not exceeding four days' pay, or, at the discretion of the court, by imprisonment not exceeding a month.

Continued willful disobedience subjects the offender to being placed in irons on bread and water, with full rations every fifth day, until the disobedience ceases, and the forfeiture, on arrival in port, of twelve days' pay for every twenty-four hours' disobedience, or by imprisonment not over three months, at the discretion of the court.

Desertion is punishable under the Seamen's Act by forfeiture of clothes and effects left on the vessel, and of wages due, the former penalty of imprisonment for desertion in a foreign port having been abolished, as also the provision for the arrest of seamen deserting from foreign vessels. This proviso is much more lenient than the laws of most foreign countries. In the case of England, if the desertion takes place outside the United Kingdom the deserter is liable {252} to imprisonment for a period not exceeding twelve weeks. Imprisonment for desertion in the coastwise trade was abolished by the Maguire Act in 1895.

Seduction of a female passenger, by master, officer, crew or employee is punishable by a fine not exceeding $1,000 and imprisonment not exceeding one year, or both. A subsequent marriage may be pleaded in bar of conviction. Misconduct, neglect or inattention to duty, resulting in loss of life, is punishable by fine not exceeding $10,000, or imprisonment not more than ten years, or both. Abandonment of seamen is punishable by a fine not over $500, or imprisonment not over six months, or both. Barratry—the attempt to injure or destroy a vessel for her insurance—is punishable by a fine not over $10,000 and imprisonment not over ten years. Wrecking—plundering or stealing from a wrecked vessel—calls for a fine not exceeding $5,000 and imprisonment not exceeding ten years. Willfully Obstructing Escape from a wrecked vessel subjects the offender to a minimum imprisonment of ten years, with a maximum punishment of imprisonment for life. Plundering a vessel,—fine $5,000 maximum, and imprisonment not exceeding ten years. Entering a vessel with intent to commit felony,—fine $10,000 maximum, and imprisonment not exceeding five years. Casting away or otherwise destroying vessel by owner,—imprisonment for life or any lesser term; by other person, imprisonment not exceeding ten years.

The carrying of sheath-knives by seamen in the merchant service is forbidden, and penalties for allowing violation of this prohibition are imposed upon the master.

Officers, seamen and employees are forbidden to visit passengers' quarters except by permission of the master. Severe penalties are imposed upon both the offending person and upon the master permitting the violation.

Corporal punishment is prohibited by the Seamen's Act under penalties not only of fine and imprisonment, but of liability to civil damages.

Ill treatment of a seaman, beating without justifiable cause, wounding or beating, or the withholding of suitable food and nourishment, or the infliction of any cruel and unusual punishment is punished by fine of not over $1,000 or imprisonment of not over five years.

Shanghaiing was prohibited, under severe penalties, in 1909.

For failing to render such assistance, or giving the information required, masters are liable to a fine of $1,000 or a year's imprisonment, and the vessel is expressly made liable for the amount named, one-half of which is payable to the informer.

XV. Rules of the Road

There are three general bodies of rules covering the navigation of vessels with respect to the rules of the road.

The first of these are the International Rules which were adopted at a conference of maritime nations held in the United States in 1889, which are now in force in practically all maritime countries. They apply only to vessels on the high seas, the boundary line of which, so far as the United States is concerned, has been defined by an act of Congress passed in 1913, under which the Secretary of Commerce, having been authorized to fix lines separating the high seas from inland waters for the purposes of the rules of the road, has defined a water line from Cutler Harbor, Maine, to Puget Sound.

The second body of rules is known as the Inland Rules, embodied in a federal statute passed in 1897, and applicable only to the waters within the line thus defined. These rules, generally speaking, are similar to the International Rules but differ in a number of details.

The third body of rules is what is known as the Pilot Rules for certain inland waters of the Atlantic and Pacific coasts and of the coast of the Gulf of Mexico, adopted by the supervising inspectors of the Steamboat Inspection Service, approved by the Secretary of Commerce under authority of the Act of June, 1897, establishing the Inland Rules, and of subsequent acts passed in 1903 and 1913, establishing the Department of Commerce. These rules are also to a large extent similar to, and are generally in harmony with the inland rules, to which they yield in case of conflict. More extended reference to these rules, the knowledge of which should be a matter of second nature to seafaring men, is beyond the scope of this summary.

XVI. Pilotage

As the states had enacted pilotage laws before the adoption of the Constitution, the right of the states to a certain measure of control over pilotage, within their boundaries, has always been recognized, and consequently a dual system has grown up. The state laws are effective except where the subject is specifically covered by a federal law.

As to the federal requirements, all vessels engaged in the coasting trade are required, when under way and within the jurisdiction of the United States, that is, except on the high seas, to be piloted by officers duly licensed under the federal law as pilots for the particular waters covered. This is covered by the qualifications laid down for {254} the various classes of vessels by the Board of Supervising Inspectors, and by the provision of our law that the qualifications necessary for obtaining a license as master, mate or pilot of all steam vessels shall be as prescribed by the Board.

Registered steam vessels, when engaged in foreign trade, and all sailing vessels of the United States in the foreign or coasting trade, are exempt from this requirement, but are subject to the requirements of the pilotage laws of the several states.

The master of a foreign vessel is not required to employ a pilot licensed under the laws of the United States.

As to state laws, the pilotage of all vessels in state waters (except enrolled steam vessels employed in the coasting trade, which are exempted from state supervision by act of Congress), is regulated by the laws of the respective states. There are, however, a number of special prohibitions designed to prevent controversy between the states. Thus, no regulation may be adopted by one state making the discrimination of a lower pilotage as to vessels sailing between ports of one state and vessels sailing between ports of different states, nor any discrimination against steam vessels; nor may a state require pilots to procure a state license in addition to that issued by the United States. It is to be noted that the federal law, which forbids the states to require enrolled coastwise steamers to take on state pilots, does not apply to sailing vessels even though they may be in a tow of a steam tug carrying a licensed pilot, a discrimination difficult to justify.

In this connection, thrifty ship agents handling registered vessels which for the time being happen to be engaged in the coasting trade, will naturally see to it that registers are exchanged for enrollments, wherever a substantial saving in the matter of exemption from state pilotage fees can be figured out.

It is to be noted, however, that in order to permit this very saving, in another direction, the government permits vessels engaged in trade through the canal to be enrolled and licensed. By thus obviating the necessity for registry, state pilotage is avoided.

XVII. Length of Hawsers

The law provides a special procedure covering length of hawsers in the case of tows. The Commissioner of Lighthouses, the Supervising Inspector of the Steamboat Inspection Service, and the Commissioner of Navigation are directed to convene as a board, under directions of the Secretary of Commerce, and to prepare regulations limiting the length of hawsers between towing vessels and seagoing barges in tow, and the length of such tows within any of the inland waters of the United States. Willful violation of these regulations subjects the license of the master of the towing vessel to suspension or revocation.

XVIII. Inspection of Steam Vessels

All steam vessels must be inspected yearly as to their hulls, and generally as to whether they have complied with all the requirements of the law in regard to fires, boats, pumps, hose, life preservers, floats, anchors, etc., as laid down in the Rules and Regulations of the United States Board of Supervising Inspectors, which should be familiar to all masters. Inspectors, however, have the widest latitude. The law requires that they shall satisfy themselves that the boat is in a condition to warrant their belief that she may be used in navigation with safety for life. In making this test they may have her put under way or may adopt any other suitable means to test her sufficiency or that of her equipment. This yearly inspection, however, may be suspended under special regulations, when vessels are laid up and dismantled and out of commission. In this connection it is perhaps worth remembering that the laws of the United States make it a criminal offense for any person knowingly to send to sea an American ship, whether in the coast, foreign or coastwise trade, in such an unseaworthy state that the life of any person is liable to be endangered. The punishment for this offense is properly severe—imprisonment not exceeding five years or a fine not exceeding $1,000 or both at the discretion of the court.

The law also provides for the yearly inspection of the boilers of all steam vessels, including tug-boats, to insure compliance with the requirements of the standards issued by the board.

Without such certificate of inspection actually in force at the time, no document can be issued for a barge, and for navigating a barge without a certificate or without the equipment referred to the owner is liable to a penalty of $500. Certificates of inspection for barges are issued in the same manner as for seagoing vessels generally. Where the certificate is not available at the time of securing a new document, evidence that it is still in force must be produced to the Collector, which may be in the form of a telegraphic confirmation of the fact, from the office of the Steamboat Inspection Bureau, Department of Commerce, Washington.

The local inspectors, on making the general inspection of the vessel, are required to make entry in the certificate of inspection of such complement of licensed officers and crew, including certificated lifeboat men, as they consider necessary for her safety, this entry being subject to right of appeal to the Supervising Inspector General.

Where such a vessel is for any reason deprived of the services of any number of the crew, without the consent or fault of the master or any person interested in the vessel, she is permitted to proceed on her voyage if, in the judgment of the master, she is still sufficiently manned. It is required, however, that the master shall ship, if obtainable, a number equal to those whose services he has been deprived of, and of the same or higher grade, also that he shall explain in writing the situation to the local inspectors within twelve hours of the arrival of the vessel at its destination under penalty of $50. The penalty for undermanning the vessel is $100, or in case of an insufficient number of licensed officers $500.

XIX. Register Tonnage

Three methods of measuring the capacity of a ship are more or less in general use in the maritime world.

The displacement tonnage, or weight of the volume of water displaced by the ship when fully loaded with all her crew, coal, supplies, etc., is in general use by the navies of the world for assuring accuracy and uniformity, but of course is not adapted to merchant vessels on which the cargo varies from voyage to voyage.

The deadweight tonnage, or actual weight of the cargo which a merchant ship will transport, obviously is adaptable only for vessels carrying bulk cargoes and not for general cargo ships. Each of these measurements is recorded in long tons avoirdupois.

The American registered tonnage system follows the Moorsom rules adopted in England in 1854, which are now in effect in practically every maritime country. It aims to express the entire cubical content of a merchant ship in unit tons of 100 cubic feet, this figure having been arrived at in England, on the adoption of the present system, when it was found that the ratio of the total registered tonnage of the British merchant marine to cubic feet of contents was slightly over 98.

{257} The measurement rules of the United States are carefully and elaborately defined in the statutes themselves.

Under the statutes net tonnage is ascertained by deducting from gross tonnage that proportion of the ship's space occupied by engine's machinery, boilers, coal bunkers and certain other minor spaces, such as those which inclose the steering gear below deck, the boatman's stores, chart-houses, donkey engine and sail room.

To encourage the building of ample forecastles, crews' quarters, etc., as well as for other reasons, the rule is adopted by almost all maritime nations that tonnage taxes and other tonnage dues shall be collected not on gross but upon the net tonnage. This also includes the usual commercial charges for towage, dockage and wharfage. Official U. S. statistics of entrances and clearances are in terms of net-register tonnage, as also time charter rates when not specifically based on deadweight tonnage. The incentive to understate net register is thus strong.

In the case of tugs engaged in foreign service and which are therefore subject to tonnage duties, it becomes important to see that the net tonnage, which should ordinarily be a very small figure, is held to the lowest limit. For instance, seagoing and oceangoing tugs have been reported with a tonnage as low as eight and ten tons. On the other hand, many American tugs of no larger capacity are in the habit of carrying a net tonnage far exceeding this amount.

XX. Tonnage Taxes

Tonnage tax is levied on every vessel engaged in trade upon her arrival by sea from a foreign port unless she is in distress. It is not levied on more than five entries at the same rate during any one year nor on vessels arriving otherwise than by sea from foreign ports at which equivalent taxes or dues are not imposed on vessels of the United States.

This tax varies from two to six cents per net ton, the two cent rate applying to ports in North and Central America, the West Indies, including Cuba and the Bermuda Islands, the coast of South America bordering on the Caribbean Sea, and New Foundland. By special treaty arrangement it also applies to Norway and Sweden. The six cent rate applies to all other trade.

Vessels entering otherwise than by sea from a foreign port at which tonnage or lighthouse dues or other equivalent tax or taxes are not imposed on vessels of the United States, are exempt from the tonnage duty of two cents per ton, not to exceed in the aggregate ten cents per ton in any one year.

These tonnage duties are substantially similar to the corresponding English rates, but are materially lower than corresponding charges in European continental ports. There are a number of special instances of exceptional cases, but which are not of sufficient frequency or importance to deserve special mention. It is well to remember, {258} however, that if any officer of an American vessel should happen not to be a citizen a penalty of fifty cents a ton is imposed, except as provided by presidential proclamation in the case of certain vessels of foreign origin.

Foreign steam tugs employed in towing coastwise vessels are liable to a tonnage of fifty cents a ton on the measurement of the vessel towed, unless the towing is done in whole, or in part, within or upon foreign waters, or when the tug-boat is owned by a foreign railway company whose cars enter into the United States by means of such transportation.

XXI. Navigation Fees

Vessels engaged in foreign trade with other than Canadian ports are subject to navigation fees upon entry. Thus if she is less than 100 tons burden the fee is $1.50. Over that amount the fee is $2.50. Her clearance fee is at the same rate.

In the event that she might have any dutiable merchandise on board she would also be liable under similar conditions to the usual fees for surveyor's services in connection with her customs entries, to wit, $1.50, if less than 100 tons, and $3 if more than 100 tons. Where she carries no dutiable merchandise, however, the fee is a nominal one of sixty-seven cents, which applies, of course, in the case of foreign ballast which is not dutiable.

XXII. Annual List of Merchant Vessels

The law provides that the Commissioner of Navigation shall publish annually a list of vessels of the United States belonging to the commercial marine, specifying their official number, signal letters, name, rig, tonnage, home port, and place and date of build, distinguishing sailing vessels from those propelled by steam or other motive power. The list for the year 1919 was the fifty-first list so published.

Under the provisions of an act passed in 1912 it is required that upon affidavit by a reputable ship builder as to the rebuilding of unrigged wooden vessels, giving date and place of their rebuilding, and certifying that they are sound and free from rotten wood and in every respect seaworthy, a notation to this effect shall be included in the list. It is noted that the provision applies only to unrigged wooden vessels, and thus does not cover the case of rigged barges, whatever their size.

XXIII. Numbering of Undocumented Motor Boats

In 1918 a law was passed requiring the numbering of all theretofore undocumented motor boats, except vessels under sixteen feet temporarily equipped with detachable motors. These numbers are awarded by the collectors of customs on application of the owner or {259} master, and are required to be painted, or otherwise attached, to the bow of the vessel, and to be not less than three inches in size. Violation of the act is subject to a penalty of $10.

From the date of the passage of the act on December 7, 1917, up to July 1, 1919, nearly 100,000 such vessels had been numbered, and the experiment had proved highly successful in assisting the enforcement of the navigation laws and the collection of taxes as well as the enforcement of harbor police laws and regulations.

XXIV. Administration of Navigation Laws

Practically every department of the government has to do with some feature or other of the navigation laws as affecting ship building, maritime commerce and ocean transportation. Primarily, however, the administration of the laws is in the hands of the Department of Commerce, under the immediate direction of the Bureau of Navigation, the Steamboat Inspection Service and the United States Shipping Commissioners. Other branches of government service whose functions touch on some phase of navigation are the Public Health Service, with its hospitals and quarantine stations, and the Coast Guard which, since 1915, has included the Revenue Cutter and Life Saving Service. The War and Navy departments also have various functions related primarily to the national defense. The activities of the Shipping Board will be separately reviewed.

The principal duty of the supervising inspectors is to supervise the work of a large number of local inspectors of hulls and of boilers, and who in their respective districts, upon designation of the Secretary {260} of Commerce, constitute the Board of Local Inspectors charged with the duties of inspection and the issuance and supervision of licenses already referred to.

One of the most important and useful functions of a Shipping Commissioner, particularly when the office is in capable hands, is that of arbitrating claims between master, consignee, agent or owner or any of the crew, when both parties agree in writing to submit to the award, it being provided by law that an award made by a Commissioner in such case is binding on both parties and in any legal proceedings is to be deemed conclusive of the rights of the party.

The Commissioners are given authority to call upon owners, agents, masters, for proof or production of books, papers, etc., or to give evidence before the Commissioner subject to a penalty and punishment for contempt for failure to so comply.

As it is the practice to insert arbitration clauses in all steamers' shipping articles, excepting those operated by the Shipping Board, which should be carefully read to the crews before they are signed, this duty is generally viewed by captains and owners as an invaluable aid to shipping and has been accepted also by the majority of seamen. The work of the Commissioners in this direction has been so successful that an effort was recently made to confer upon the Commissioners by law certain magisterial powers subject to appeal to the United States District Courts. So far the effort has been unsuccessful.

Having in mind their responsibilities and enormous possibilities of service to navigation, Shipping Commissioners are among the most pitifully underpaid of government officials. As an illustration of this it may be noted that the Commissioners in the great ports of Philadelphia and of Norfolk receive salaries of $2,400 and of $1,800, respectively.

XXV. The Shipping Board

The United States Shipping Board was created before the war, by the Shipping Act of 1916, with the dual function and purpose, first of acting as the administrative agent of the government in developing {261} the merchant marine and the naval auxiliary in peace time, and, second, that of meeting the shipping problems incident to a possible war.

Its most important powers have heretofore been exercised through the instrumentality of the United States Shipping Board Emergency Fleet Corporation, organized by, and the stock of which has been held by, the Shipping Board, for the Government. The primary function of the Corporation was the construction of vessels, but its work was soon extended to include their operation, in an effort to avoid the embarrassments, prior to our entering the war, of having our vessels, if operated by such purely public administrative agency as the Shipping Board, treated as public vessels in foreign ports. In the beginning it was intended that the Corporation should function in the character of a private corporation, and 50,000,000 dollars was appropriated to it for the construction of vessels, but during the war it acted primarily as the agent of the President, claiming the immunities and privileges incident to that somewhat anomalous relation, and has expended upwards of 3,000,000,000 dollars, its capital remaining intact. The actual operation of vessels by the Corporation has been carried out through the instrumentality of a specially organized Division of Operations, which was largely separate from the Corporation itself, and subject to the direction and supervision of the Shipping Board.

The jurisdiction of the Shipping Board, however, has not been confined to vessels in which the government is interested as owner or charterer. From the first the Board has had authority to enforce a general prohibition against unfair discrimination and preferences and against the improper influencing of marine insurance companies by common carriers by water, whether in foreign or interstate commerce, not including tramps, and has also exercised the right of supervising and regulating tariffs fixed by common carriers in interstate commerce. In this field, however, the jurisdiction of the Board does not overlap the jurisdiction of the Interstate Commerce Commission, which has authority to establish through routes and joint rates where they involve water transportation. Like the Interstate Commerce Commission the orders of the Shipping Board are subject to review by the federal courts.

A recent provision of the Merchant Marine Act (1920) reorganizes and strengthens the Shipping Board, consolidating and centralizing its control and giving it wide powers in the matter of developing the American merchant marine and of encouraging the establishment of new lines and the investigation generally of all matters relative to the advancement of merchant marine.

Among other new powers of general scope given to the Board is that under which it is authorized to make rules and regulations affecting shipping in the foreign trade, wherever necessary, in order to meet special conditions in foreign trade arising out of foreign laws or competitive methods practiced in foreign countries. The Board is also authorized to request the heads of departments to suspend {262} and modify regulations or to make new regulations affecting shipping in the foreign trade, except those relating to the Public Health Service, the Consular Service and the Steamboat Inspection Service, and no rules or regulations excepting those affecting the services named, may be established by any department without being first submitted to the Board for its approval and final action taken thereon by the Board or the President.

APPENDIX II
THE MERCHANT MARINE ACT OF 1920[34]

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That it is necessary for the national defense and for the proper growth of its foreign and domestic commerce that the United States shall have a merchant marine of the best equipped and most suitable types of vessels sufficient to carry the greater portion of its commerce and serve as a naval or military auxiliary in time of war or national emergency, ultimately to be owned and operated privately by the citizens of the United States; and it is hereby declared to be the policy of the United States to do whatever may be necessary to develop and encourage the maintenance of such a merchant marine, and, in so far as may not be inconsistent with the express provisions of this Act, the United States Shipping Board shall, in the disposition of vessels and shipping property as hereinafter provided, in the making of rules and regulations, and in the administration of the shipping laws keep always in view this purpose and object as the primary end to be attained.

(1) The emergency shipping fund provisions of the Act entitled "An Act making appropriations to supply urgent deficiencies in appropriations for the Military and Naval Establishments on account of war expenses for the fiscal year ending June 30, 1917, and for other purposes," approved June 15, 1917, as amended by the Act entitled "An Act to amend the emergency shipping fund provisions of the Urgent Deficiency Appropriation Act, approved June 15, 1917, so as to empower the President and his designated agents to take over certain transportation systems for the transportation of shipyard and plant employees, and for other purposes," approved April 22, 1918, and as further amended by the Act entitled "An Act making appropriation to supply deficiencies in appropriations for the fiscal year ending June 30, 1919, and prior fiscal years, on account of war expenses, and for other purposes," approved November 4, 1918;

(2) Section 3 of such Act of April 22, 1918;

{264} (3) The paragraphs numbered 2 and 3 under the heading "Emergency shipping fund" in such Act of November 4, 1918; and

(4) The Act entitled "An Act to confer on the President power to prescribe charter rates and freight rates and to requisition vessels, and for other purposes," approved July 18, 1918.

(5) Sections 5, 7, and 8, Shipping Act, 1916.

(b) The repeal of such Acts or parts of Acts is subject to the following limitations:

(1) All contracts or agreements lawfully entered into before the passage of this Act under any such Act or part of Act shall be assumed and carried out by the United States Shipping Board, hereinafter called "the board."

(2) All rights, interests, or remedies accruing or to accrue as a result of any such contract or agreement or of any action taken in pursuance of any such Act or parts of Acts shall be in all respects as valid, and may be exercised and enforced in like manner, subject to the provisions of subdivision (c) of this section, as if this Act had not been passed.

(3) The repeal shall not have the effect of extinguishing any penalty incurred under such Acts or parts of Acts, but such Acts or parts of Acts shall remain in force for the purpose of sustaining a prosecution for enforcement of the penalty therein provided for the violation thereof.

(4) The board shall have full power and authority to complete or conclude any construction work begun in accordance with the provisions of such Acts or parts of Acts if, in the opinion of the board, the completion or conclusion thereof is for the best interests of the United States.

(c) As soon as practicable after the passage of this Act the board shall adjust, settle, and liquidate all matters arising out of or incident to the exercise by or through the President of any of the powers or duties conferred or imposed upon the President by any such Act or parts of Acts; and for this purpose the board, instead of the President, shall have and exercise any of such powers and duties relating to the determination and payment of just compensation: Provided, That any person dissatisfied with any decision of the board shall have the same right to sue the United States as he would have had if the decision had been made by the President of the United States under the Acts hereby repealed.

"Sec. 3. That a board is hereby created to be known as the United States Shipping Board and hereinafter referred to as the board. The board shall be composed of seven commissioners, to be appointed by the President, by and with the advice and consent of the Senate; and the President shall designate the member to act as chairman of the board, and the board may elect one of its members as vice chairman. Such commissioners shall be appointed as soon as practicable {265} after the enactment of this Act and shall continue in office two for a term of one year, and the remaining five for terms of two, three, four, five, and six years, respectively, from the date of their appointment, the term of each to be designated by the President, but their successors shall be appointed for terms of six years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired term of the commissioner whom he succeeds.

"The commissioners shall be appointed with due regard to their fitness for the efficient discharge of the duties imposed on them by this Act, and two shall be appointed from the States touching the Pacific Ocean, two from the States touching the Atlantic Ocean, one from the States touching the Gulf of Mexico, one from the States touching the Great Lakes and one from the interior, but not more than one shall be appointed from the same State. Not more than four of the commissioners shall be appointed from the same political party. A vacancy in the board shall be filled in the same manner as the original appointments. No commissioner shall take any part in the consideration or decision of any claim or particular controversy in which he has a pecuniary interest.

"Each commissioner shall devote his time to the duties of his office, and shall not be in the employ of or hold any official relation to any common carrier or other person subject to this Act, nor while holding such office acquire any stock or bonds thereof or become pecuniarily interested in any such carrier.

"The duties of the board may be so divided that under its supervision the directorship of various activities may be assigned to one or more commissioners. Any commissioner may be removed by the President for inefficiency, neglect of duty, or malfeasance in office. A vacancy in the board shall not impair the right of the remaining members of the board to exercise all its powers. The board shall have an official seal, which shall be judicially noticed.

"The board may adopt rules and regulations in regard to its procedure and the conduct of its business. The board may employ within the limits of appropriations made therefor by Congress such attorneys as it finds necessary for proper legal service to the board in the conduct of its work, or for proper representation of the public interest in investigations made by it or proceedings pending before it whether at the board's own instance or upon complaint, or to appear for or represent the board in any case in court or other tribunal. The board shall have such other rights and perform such other duties not inconsistent with the Merchant Marine Act, 1920, as are conferred by existing law upon the board in existence at the time this section as amended takes effect.

"The commissioners in office at the time this section as amended takes effect shall hold office until all the commissioners provided for in this section as amended are appointed and qualify."

(b) The first sentence of section 4 of the "Shipping Act, 1916," is amended to read as follows:

{266} "Sec. 4. That each member of the board shall receive a salary of $12,000 per annum."

The possession and control of such other docks, piers, warehouses, wharves and terminal equipment and facilities or parts thereof, including all leasehold easements, rights of way, riparian rights and other rights, estates or interests therein or appurtenant thereto which were acquired by the War Department or the Navy Department for military or naval purposes during the war emergency may be transferred by the President to the board whenever the President deems such transfer to be for the best interests of the United States.

The President may at any time he deems it necessary, by order setting out the need therefor and fixing the period of such need, permit or transfer the possession and control of any part of the property taken over by or transferred to the board under this section to the War Department or the Navy Department for their needs, and when in the opinion of the President such need therefor ceases the possession and control of such property shall revert to the board. None of such property shall be sold except as may be hereafter provided by law.

"Sec. 9. That any vessel purchased, chartered, or leased from the board, by persons who are citizens of the United States, may be registered or enrolled and licensed, or both registered and enrolled and licensed, as a vessel of the United States and entitled to the benefits and privileges appertaining thereto: Provided, That foreign-built vessels admitted to American registry or enrollment and license under this Act, and vessels owned by any corporation in which the United States is a stockholder, and vessels sold, leased, or chartered by the board to any person a citizen of the United States, as provided in this Act, may engage in the coastwise trade of the United States while owned, leased, or chartered by such a person.

"Every vessel purchased, chartered, or leased from the board shall, unless otherwise authorized by the board, be operated only under such registry or enrollment and license. Such vessels while employed solely as merchant vessels shall be subject to all laws, regulations, and liabilities governing merchant vessels, whether the United States be interested therein as owner, in whole or in part, or hold any mortgage, lien, or other interest therein.

"It shall be unlawful to sell, transfer or mortgage, or, except under regulations prescribed by the board, to charter, any vessel purchased from the board or documented under the laws of the United {272} States to any person not a citizen of the United States, or to put the same under a foreign registry or flag, without first obtaining the board's approval.

"Any vessel chartered, sold, transferred or mortgaged to a person not a citizen of the United States or placed under a foreign registry or flag, or operated, in violation of any provision of this section shall be forfeited to the United States, and whoever violates any provision of this section shall be guilty of a misdemeanor and subject to a fine of not more than $5,000, or to imprisonment for not more than five years, or both."

(a) To make all necessary rules and regulations to carry out the provisions of this Act;

(b) To make rules and regulations affecting shipping in the foreign trade not in conflict with law in order to adjust or meet general or special conditions unfavorable to shipping in the foreign trade, whether in any particular trade or upon any particular route or in commerce generally and which arise out of or result from foreign laws, rules, or regulations or from competitive methods or practices employed by owners, operators, agents, or masters of vessels of a foreign country; and

(c) To request the head of any department, board, bureau, or agency of the Government to suspend, modify, or annul rules or regulations which have been established by such department, board, bureau, or agency, or to make new rules or regulations affecting shipping in the foreign trade other than such rules or regulations relating to the Public Health Service, the Consular Service, and the Steamboat Inspection Service.

(2) No rule or regulation shall hereafter be established by any department, board, bureau, or agency of the Government which affect shipping in the foreign trade, except rules or regulations affecting the Public Health Service, the Consular Service, and the Steamboat Inspection Service, until such rule or regulation has been submitted to the board for its approval and final action has been taken thereon by the board or the President.

(3) Whenever the head of any department, board, bureau, or agency of the Government refuses to suspend, modify, or annul any rule or regulation, or make a new rule or regulation upon request of the board, as provided in subdivision (c) of paragraph (1) of this section, or objects to the decision of the board in respect to the approval of any rule or regulation, as provided in paragraph (2) of this section, either the board or the head of the department, board, bureau, or agency which has established or is attempting to establish the rule or regulation in question may submit the facts to the President, who is hereby authorized to establish or suspend, modify, or annul such rule or regulation.

(4) No rule or regulation shall be established which in any manner {273} gives vessels owned by the United States any preference or favor over those vessels documented under the laws of the United States and owned by persons who are citizens of the United States.

"Sec. 14. That no common carrier by water shall, directly or indirectly, in respect to the transportation by water of passengers or property between a port of a State, Territory, District, or possession of the United States and any other such port or a port of a foreign country,—

"First. Pay, or allow, or enter into any combination, agreement, or understanding, express or implied, to pay or allow, a deferred rebate to any shipper. The term 'deferred rebate' in this Act means a return of any portion of the freight money by a carrier to any shipper as a consideration for the giving of all or any portion of his shipments to the same or any other carrier, or for any other purpose, the payment of which is deferred beyond the completion of the service for which it is paid, and is made only if, during both the period for which computed and the period of deferment, the shipper has complied with the terms of the rebate agreement or arrangement.

"Second. Use a fighting ship either separately or in conjunction with any other carrier, through agreement or otherwise. The term 'fighting ship' in this Act means a vessel used in a particular trade by a carrier or group of carriers for the purpose of excluding, preventing or reducing competition by driving another carrier out of said trade.

"Third. Retaliate against any shipper by refusing, or threatening to refuse, space accommodations when such are available, or resort to other discriminating or unfair methods, because such shipper has patronized any other carrier or has filed a complaint charging unfair treatment, or for any other reason.

"Fourth. Make any unfair or unjustly discriminatory contract with any shipper based on the volume of freight offered, or unfairly treat or unjustly discriminate against any shipper in the matter of (a) cargo space accommodations or other facilities, due regard being had for the proper loading of the vessel and the available tonnage; (b) the loading and landing of freight in proper condition; or (c) the adjustment and settlement of claims.

"Any carrier who violates any provision of this section shall be guilty of a misdemeanor punishable by a fine of not more than $25,000 for each offense."

(2) The Shipping Act, 1916, as amended, is amended by inserting after section 14 a new section to read as follows:

"Sec. 14a. The board upon its own initiative may, or upon complaint shall, after due notice to all parties in interest and hearing, determine whether any person, not a citizen of the United States and engaged in transportation by water of passengers or property—

"(1) Has violated any provision of section 14, or

{274} "(2) Is a party to any combination, agreement, or understanding, express or implied, that involves in respect to transportation of passengers or property between foreign ports, deferred rebates or any other unfair practice designated in section 14, and that excludes from admission upon equal terms with all other parties thereto, a common carrier by water which is a citizen of the United States and which has applied for such admission.

"If the board determines that any such person has violated any such provision or is a party to any such combination, agreement, or understanding, the board shall thereupon certify such fact to the Secretary of Commerce. The Secretary shall thereafter refuse such person the right of entry for any ship owned or operated by him or by any carrier directly or indirectly controlled by him, into any port of the United States, or any Territory, District, or possession thereof, until the board certifies that the violation has ceased or such combination, agreement, or understanding has been terminated."

That during the period of ten years from the enactment of this Act any person a citizen of the United States who may sell a vessel documented under the laws of the United States and built prior to January 1, 1914, shall be exempt from all income taxes that would be payable upon any of the proceeds of such sale under Title I, Title II, and Title III of the Revenue Act of 1918 if the entire proceeds thereof shall be invested in the building of new ships in American shipyards, such ships to be documented under the laws of the United States and to be of a type approved by the board.

The privilege bestowed by this section on vessels of the United {277} States shall be extended insofar as the foreign trade is concerned to the cargo vessels of any nation which allows the like privilege to cargo vessels of the United States in trades not restricted to vessels under its own flag.

Failure on the part of the owner, agent, or master of the vessel to give such notice shall subject the vessel to a penalty of $500, which may be mitigated or remitted by the Secretary of Commerce upon a proper representation of the facts.

(1) The term "association" means any association, exchange, pool, combination, or other arrangement for concerted action; and

(2) The term "marine insurance companies" means any persons, companies, or associations, authorized to write marine insurance or reinsurance under the laws of the United States or of a State, Territory, District, or possession thereof.

(b) Nothing contained in the "antitrust laws" as designated in section 1 of the Act entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved October 15, 1914, shall be construed as declaring illegal an association entered into by marine insurance companies for the following purposes: To transact a marine insurance and reinsurance business in the United States and in foreign countries and to reinsure or otherwise apportion among its membership the risks undertaken by such association or any of the component members.

DEFINITIONS.

(1) The term "document" includes registry and enrollment and license;

(2) The term "documented" means registered or enrolled or licensed under the laws of the United States, whether permanently or temporarily;

(3) The term "port of documentation" means the port at which the vessel is documented, in accordance with law;

(4) The term "vessel of the United States" means any vessel documented under the laws of the United States and such vessel shall be held to continue to be so documented until its documents are surrendered with the approval of the board; and

(5) The term "mortgagee," in the case of a mortgage involving a trust deed and a bond issue thereunder, means the trustee designated in such deed.

RECORDING OF SALES, CONVEYANCES, AND MORTGAGES OF VESSELS OF THE UNITED STATES.

(b) Such collector of customs shall record bills of sale, conveyances, and mortgages, delivered to him, in the order of their reception, in books to be kept for that purpose and indexed to show—

(1) The name of the vessel;

(2) The names of the parties to the sale, conveyance, or mortgage;

(3) The time and date of reception of the instrument;

(4) The interest in the vessel so sold, conveyed, or mortgaged; and

(5) The amount and date of maturity of the mortgage.

(1) The mortgage is indorsed upon the vessel's documents in accordance with the provisions of this section;

(2) The mortgage is recorded as provided in subsection C, together with the time and date when the mortgage is so indorsed;

(3) An affidavit is filed with the record of such mortgage to the effect that the mortgage is made in good faith and without any design to hinder, delay, or defraud any existing or future creditor of the mortgagor or any lienor of the mortgaged vessel;

(4) The mortgage does not stipulate that the mortgagee waives the preferred status thereof; and

(5) The mortgagee is a citizen of the United States.

(b) Any mortgage which complies in respect to any vessel with the conditions enumerated in this subsection is hereafter in this section called a "preferred mortgage" as to such vessel.

(c) There shall be indorsed upon the documents of a vessel covered by a preferred mortgage—

(1) The name of the mortgagor and mortgagee;

(2) The time and date the indorsement is made;

(3) The amount and date of maturity of the mortgage; and

(4) Any amount required to be indorsed by the provisions of subdivision (e) or (f) of this subsection.

(d) Such indorsement shall be made (1) by the collector of customs of the port of documentation of the mortgaged vessel, or (2) by the collector of customs of any port in which the vessel is found, if such collector is directed to make the indorsement by the collector of customs of the port of documentation; and no clearance shall be issued to the vessel until such indorsement is made. The collector of {280} customs of the port of documentation shall give such direction by wire or letter at the request of the mortgagee and upon the tender of the cost of communication of such direction. Whenever any new document is issued for the vessel, such indorsement shall be transferred to and indorsed upon the new document by the collector of customs.

(e) A mortgage which includes property other than a vessel shall not be held a preferred mortgage unless the mortgage provides for the separate discharge of such property by the payment of a specified portion of the mortgage indebtedness. If a preferred mortgage so provides for the separate discharge, the amount of the portion of such payment shall be indorsed upon the documents of the vessel.

(f) If a preferred mortgage includes more than one vessel and provides for the separate discharge of each vessel by the payment of a portion of the mortgage indebtedness, the amount of such portion of such payment shall be indorsed upon the documents of the vessel. In case such mortgage does not provide for the separate discharge of a vessel and the vessel is to be sold upon the order of a district court of the United States in a suit in rem in admiralty, the court shall determine the portion of the mortgage indebtedness increased by 20 per centum (1) which, in the opinion of the court, the approximate value of the vessel bears to the approximate value of all the vessels covered by the mortgage, and (2) upon the payment of which the vessel shall be discharged from the mortgage.

(b) The mortgagor, upon a discharge in whole or in part of the mortgage indebtedness, shall forthwith file with the collector of customs for the port of documentation of the vessel, a certificate of such discharge. Such collector of customs shall thereupon record the certificate. In case of a vessel covered by a preferred mortgage, the collector of customs at the port of documentation shall (1) indorse upon the documents of the vessel, or direct the collector of customs at any port in which the vessel is found, to so indorse, the fact of such discharge, and (2) shall deny clearance to the vessel until such indorsement is made.

(b) No bill of sale, conveyance, mortgage, notice of claim of lien, or certificate of discharge thereof, shall be recorded unless previously acknowledged before a notary public or other officer authorized by a law of the United States, or of a State, Territory, District, or possession thereof, to take acknowledgment of deeds.

(c) In case of a change in the port of documentation of a vessel of the United States, no bill of sale, conveyance, or mortgage shall be recorded at the new port of documentation unless there is furnished to the collector of customs of such port, together with the copy of the bill of sale, conveyance, or mortgage to be recorded, a certified copy of the record of the vessel at the former port of documentation furnished by the collector of such port. The collector of customs at the new port of documentation is authorized and directed to record such certified copy.

(d) A preferred mortgage may bear such rate of interest as is agreed by the parties thereto.

PENALTIES.

(b) A mortgagor who, with intent to defraud, violates any provision of subsection F, and if the mortgagor is a corporation or association, the president or other principal executive officer of the corporation or association, shall upon conviction thereof be held guilty of a misdemeanor and shall be fined not more than $1,000 or imprisonment not more than 2 years, or both. The mortgaged indebtedness shall thereupon become immediately due and payable at the election of the mortgagee.

(c) If any person enters into any contract secured by, or upon the credit of, a vessel of the United States covered by a preferred mortgage, and suffers pecuniary loss by reason of the failure of the collector of customs, or any officer, employee, or agent thereof, properly to perform any duty required of the collector under the provisions of this section, the collector of customs shall be liable to such person for damages in the amount of such loss. If any such person is caused any such loss by reason of the failure of the mortgagor, or master of the mortgaged vessel, or any officer, employee, or agent thereof, to comply with any provision of subsection E or F or to file an affidavit as required by subdivision (a) of subsection D, correct in each particular thereof, the mortgagor shall be liable to such person for damages in the amount of such loss. The district courts of the United States are given jurisdiction (but not to the exclusion of the courts of the several States, Territories, Districts, or possessions) of suits for the recovery of such damages, irrespective of the amount involved in the suit or the citizenship of the parties thereto. Such suit shall be begun by personal service upon the defendant within the limits of the district. Upon judgment for the plaintiff in any such suit, the court shall include in the judgment an additional amount for costs of the action and a reasonable counsel's fee, to be fixed by the court.

FORECLOSURE OF PREFERRED MORTGAGES.

(b) Upon the sale of any mortgaged vessel by order of a district court of the United States in any suit in rem in admiralty for the enforcement of a preferred mortgage lien thereon, all preëxisting claims in the vessel, including any possessory common-law lien of which a lienor is deprived under the provisions of subsection L shall be held terminated and shall thereafter attach, in like amount and in accordance with their respective priorities, to the proceeds of the sale; except that the preferred mortgage lien shall have priority over all claims against the vessel, except (1) preferred maritime liens, and (2) expenses and fees allowed and costs taxed, by the court.

(b) This section shall not be construed, in the case of a mortgage covering, in addition to vessels, realty or personalty other than vessels, or both, to authorize the enforcement by suit in rem in admiralty of the rights of the mortgagee in respect to such realty or personalty other than vessels.

TRANSFERS OF MORTGAGED VESSELS AND ASSIGNMENT OF VESSEL MORTGAGES.

(b) The interest of the mortgagee in a vessel of the United States covered by a mortgage, shall not be terminated by the forfeiture of the vessel for a violation of any law of the United States, unless the mortgagee authorized, consented, or conspired to effect the illegal act, failure, or omission which constituted such violation.

(c) Upon the sale of any vessel of the United States covered by a preferred mortgage, by order of a district court of the United States in any suit in rem in admiralty for the enforcement of a maritime lien other than a preferred maritime lien, the vessel shall be sold free from all preëxisting claims thereon; but the court shall, upon the request of the mortgagee, the libellant, or an intervenor, require the purchaser at such sale to give and the mortgagor to accept a new mortgage of the vessel for the balance of the term of the original mortgage. The conditions of such new mortgage shall be the same, so far as practicable, as those of the original mortgage and shall be subject to the approval of the court. If such new mortgage is given, the mortgagee shall not be paid from the proceeds of the sale and the amount payable as the purchase price shall be held diminished in the amount of the new mortgage indebtedness.

(d) No rights under a mortgage of a vessel of the United States shall be assigned to any person not a citizen of the United States without the approval of the board. Any assignment in violation of any provision of this section shall be void.

(e) No vessel of the United States shall be sold by order of a district court of the United States in any suit in rem in admiralty to any person not a citizen of the United States.

MARITIME LIENS FOR NECESSARIES.

MISCELLANEOUS PROVISIONS.

"Sec. 4530. Every seaman on a vessel of the United States shall be entitled to receive on demand from the master of the vessel to which he belongs one-half part of the balance of his wages earned and remaining unpaid at the time when such demand is made at every port where such vessel, after the voyage has been commenced, shall load or deliver cargo before the voyage is ended, and all stipulations in the contract to the contrary shall be void: Provided, Such a demand shall not be made before the expiration of, nor oftener than once in, five days nor more than once in the same harbor on the same entry. Any failure on the part of the master to comply with this demand shall release the seaman from his contract and he shall be entitled to full payment of wages earned. And when the voyage is ended every such seaman shall be entitled to the remainder of the wages which shall be then due him, as provided in section 4529 of the Revised Statutes: Provided further, That notwithstanding any release signed by any seaman under section 4552 of the Revised Statutes any court having jurisdiction may upon good cause shown set aside such release and take such action as justice shall require: And provided further, That this section shall apply to seamen on foreign vessels while in harbors of the United States, and the courts of the United States shall be open to such seamen for its enforcement."

"Sec. 10. (a) That it shall be, and is hereby, made unlawful in any case to pay any seaman wages in advance of the time when he has actually earned the same, or to pay such advance wages, or to {287} make any order, or note, or other evidence of indebtedness therefor to any other person, or to pay any person, for the shipment of seamen when payment is deducted or to be deducted from a seaman's wages. Any person violating any of the foregoing provisions of this section shall be deemed guilty of a misdemeanor, and upon conviction shall be punished by a fine of not less than $25 nor more than $100, and may also be imprisoned for a period of not exceeding six months, at the discretion of the court. The payment of such advance wages or allotment, whether made within or without the United States or territory subject to the jurisdiction thereof, shall in no case except as herein provided absolve the vessel or the master or the owner thereof from the full payment of wages after the same shall have been actually earned, and shall be no defense to a libel suit or action for the recovery of such wages. If any person shall demand or receive, either directly or indirectly, from any seaman or other person seeking employment, as seaman, or from any person on his behalf, any remuneration whatever for providing him with employment, he shall for every such offense be deemed guilty of a misdemeanor and shall be imprisoned not more than six months or fined not more than $500."

"Sec. 20. That any seaman who shall suffer personal injury in the course of his employment may, at his election, maintain an action for damages at law, with the right of trial by jury, and in such action all statutes of the United States modifying or extending the common-law right or remedy in cases of personal injury to railway employees shall apply; and in case of the death of any seaman as a result of any such personal injury the personal representative of such seaman may maintain an action for damages at law with the right of trial by jury, and in such action all statutes of the United States conferring or regulating the right of action for death in the case of railway employees shall be applicable. Jurisdiction in such actions shall be under the court of the district in which the defendant employer resides or in which his principal office is located."

"Sec. 2. (a) That within the meaning of this Act no corporation, partnership, or association shall be deemed a citizen of the United States unless the controlling interest therein is owned by citizens of the United States, and, in the case of a corporation, unless its president and managing directors are citizens of the United States and the corporation itself is organized under the laws of the United States or of a State, Territory, District, or possession thereof, but in the case of a corporation, association, or partnership operating any vessel in the coastwise trade the amount of interest required to be owned by citizens of the United States shall be 75 per centum.

"(b) The controlling interest in a corporation shall not be deemed to be owned by citizens of the United States (a) if the title to a majority of the stock thereof is not vested in such citizens free from any trust or fiduciary obligation in favor of any person not a citizen of the United States; or (b) if the majority of the voting power in such corporations is not vested in citizens of the United States; or (c) if through any contract or understanding it is so arranged that the majority of the voting power may be exercised, directly or indirectly, in behalf of any person who is not a citizen of the United States; or (d) if by any other means whatsoever control of the corporation is conferred upon or permitted to be exercised by any person who is not a citizen of the United States.

"(c) Seventy-five per centum of the interest in a corporation shall not be deemed to be owned by citizens of the United States (a) if the title to 75 per centum of its stock is not vested in such citizens free from any trust or fiduciary obligation in favor of any person not a citizen of the United States; or (b) if 75 per centum of the voting power in such corporations is not vested in citizens of the United States; or (c) if, through any contract or understanding it is so {289} arranged that more than 25 per centum of the voting power in such corporation may be exercised, directly or indirectly, in behalf of any person who is not a citizen of the United States; or (d) if by any other means whatsoever control of any interest in the corporation in excess of 25 per centum is conferred upon or permitted to be exercised by any person who is not a citizen of the United States.

"(d) The provisions of this Act shall apply to receivers and trustees of all persons to whom the Act applies, and to the successors or assignees of such persons."

Approved June 5, 1920.

APPENDIX III
PROTEST

The following is a specimen of a marine protest. It is taken from Lawrence v. Minturn, 17 How. 100. It was signed by all the officers and by such of the crew as could write:

At sea, on board ship Hornet of New York, William W. Lawrence, master, bound from New York to San Francisco, California.

We, the undersigned, master, officers and mariners of the ship Hornet, of New York, do, after mature and serious deliberation, enter this solemn protest: That on August 26th, 1851, the ship Hornet being then in or about the longitude of 49° W., latitude 37° N., experiencing a gale of wind from the south, veering to N. W.: and that during said gale, which lasted until the night of the 27th of August, the weight of the deck load, consisting of two boilers, with furnaces attached, and two steam chimneys (the whole supposed to be of the weight of forty tons or thereabouts), did cause the ship to labor very hard, rolling gunwale deep, shipping large bodies of water, straining the ship in her upper works and decks, causing the ship to leak badly, and her pumps constantly worked, placing our lives, ship and cargo in imminent peril for their safety. We now, therefore, do most seriously and solemnly assert, that for the future preservation of the ship, and thereby our lives and cargo, the said boilers, furnaces and chimneys are unsafe on the decks, and for the safety of the whole should be thrown overboard as soon as possible, the weather and sea permitting.

In testimony whereof to the above, we hereby subscribe our respective names.

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