1. Where insurers to whom the owners have abandoned take
possession at an intermediate place or port of goods damaged during
a voyage by the fault of the carrier, and there sell them, they
cannot hold the carrier liable on his engagement to deliver at the
end of the voyage in good order and condition.
2. Facts stated which amount to such action on the part of the
insurers.
3. Insurers, so accepting at the intermediate port, are liable
for freight
pro rata itineris on the goods accepted.
4. The explosion of a boiler on a steam vessel is not a "peril
of navigation" within the term as used in the exception in bills of
lading.
Page 75 U. S. 154
5. The Court expresses its satisfaction that it could, in
accordance with principles of law, decide against a party who had
bought and was prosecuting a claim that the original party was not
himself willing to prosecute; it characterizes such a purchaser
suing as "a volunteer in a speculation."
On the 31st of October, 1860, two parties, owners of it, shipped
on board the propeller
Mohawk, the vessel being then at
Chicago, and as was admitted in a stipulation of record, "in good
and seaworthy condition," two consignments of wheat, amounting to
20,200 bushels, to be delivered at Buffalo in good order and
condition, dangers of navigation excepted, upon payment of freight
and charges. The property was insured by an insurance company at
the last-named place for $20,000. The propeller proceeded on her
voyage, and after the same had been more than half completed,
grounded on the 7th of November on the St. Clair Flats, near
Detroit. In the effort to get her off she became disabled by the
bursting of her boiler, and afterwards sunk, and was compelled to
suspend her voyage for a few days to make necessary repairs.
All the wheat but 1,100 bushels got wet and was damaged by the
sinking of the propeller. Upon information then given to the
consignee and insurers at Buffalo, the agent of the owners of the
wheat immediately abandoned it to the underwriters as for a total
loss, and the latter then accepted the abandonment and paid the
loss to the owners as for a total loss.
On the 11th of November, the underwriters ordered their agent at
Detroit to take possession of the damaged wheat, and to sell it as
it lay in the vessel at the flats, and the agent thereupon did sell
the damaged portion of it to one Phelps, for $1,200, and took his
note therefor, at 30 days. A delivery into lighters to the
purchaser began on the same day. The next day (the 12th) the agent
reported the sale, and on the 13th received a telegram from his
company acknowledging the advices, and approving thereof. After the
sale had been
Page 75 U. S. 155
thus made, the company hearing that the master intended to claim
freight, directed the agent to have nothing to do with the grain,
unless the owners of the vessel would relinquish all claim for
freight. It was arranged, however, between the agent and the
master, that as the sale was a good one, it should stand, and that
the freight should be left for after consideration. The whole of
the damaged portion of the cargo, amounting to 19,100 bushels, was
delivered by the propeller to the purchaser, Phelps, and the
residue, 1,100 bushels, was retained on board, and carried by the
propeller to Buffalo, where it arrived safely. On
that
residue the insurance company tendered full freight and all
other lawful charges, including a sum to cover general average
charges, but refused to pay either
pro rata or full
freight on the wheat delivered on the flats. The master accordingly
refused to deliver the 1,100 bushels; the value of it being less
than the freight on it and the
pro rata freight on the
larger quantity sold; and he asserting that he was entitled to
freight on the entire shipment, either in full, or
pro
rata.
Soon after this (though with how correct a knowledge of facts
was a matter, as it seemed, subsequently disputed by counsel), the
counsel of the insurance company on the one hand, and of the
shippers on the other, agreed upon a statement of facts, and on it
the company brought suit in the Superior Court of Buffalo, to test
the liabilities of the shippers upon the facts as then supposed.
The insurance company, however, acting herein against the urgency
of their agent at Detroit, "who never expressed but one opinion,
which was, that the carriers were liable and ought to be sued,"
after some time discontinued this suit.
After this -- this is to say in July, 1862, and through the same
agent -- the claim of the company on the carriers was sold to one
Barrell, for about $2,300.
Libels were now filed, August, 1862, in the District Court of
Illinois in the names of the owners of the wheat, claiming damages
for the nondelivery of it. After hearing, the libels were
dismissed. Thereupon an appeal was taken to the circuit court.
Page 75 U. S. 156
Barrell now presented his petition to that court, stating that
the underwriters had assigned their interest in the cargo to him,
and that he was equitably interested and entitled to intervene, and
have the benefit of both of the above libels. On this petition, the
circuit court consolidated both causes, and made order that he be
subrogated to all the rights of the libellants, and that he have
leave to file an amended libel. He did accordingly file such a
libel, alleging the shipping of the cargo on board the
Mohawk; that the propeller left port
in good and
seaworthy condition, and that after the voyage was more than
half completed she was carelessly grounded on the St. Clair Flats.
He also alleged the abandonment, and averred that the underwriters
had suffered damages on account of the injury to the wheat, as well
as for the nondelivery of the 1,100 bushels detained by the
propeller; and that he, as assignee of the insurance company, was
entitled to recover therefor.
To this libel answer was made, denying negligence in grounding
the vessel; admitting the nondelivery of the 1100 bushels of wheat,
and asserting a right to hold it for freight; both that earned on
the wheat actually delivered at St. Clair Flats, and on the 1,100
bushels transported to Buffalo; abandonment was admitted; any
assignment from the insurance company was denied; and the character
of that transaction set forth with allegations, in substance, that
it savored of
maintenance. The substance of this answer
was also proved.
The note at thirty days for $1,200, given by the purchaser
Phelps, was still in possession of the insurance company.
The circuit court affirmed the decree of the district court, and
the case was now here, on the action of Barrell, for review.
The appellant made two claims:
1. To have damages for injury to the cargo by the sinking of the
propeller.
2. To have the 1,100 bushels which the propeller had
retained,
Page 75 U. S. 157
or their value, upon paying the freight earned on that parcel
only.
Page 75 U. S. 159
MR. JUSTICE NELSON delivered the opinion of the Court.
The insurance company, having accepted the abandonment
Page 75 U. S. 160
of the wheat by the owner, after the disaster to the vessel,
became subrogated to all the rights of the shipper, and might have
left the responsibility upon the master to refit his vessel, or
procure another, and forward the wheat to its port of delivery,
according to the contract in the bill of lading. The vessel could
have been refitted within a short time, and this port was but a few
days' navigation from the place of the disaster. Besides, it
occurred in the track of vessels from Chicago, and other ports on
the upper lakes, and there could have been but little difficulty in
procuring the shipment in another vessel.
But no choice was left to the master, whether to refit his
vessel or send on the cargo in another, or to communicate with his
owners, who were in Buffalo, as to the proper course to be pursued.
The second day after the disaster, the agent of the insurance
company appeared with instructions to take possession of the
damaged wheat, and sell it as it lay in the vessel. Possession was
given up accordingly, and the wheat sold on the same day, the sale
perfected, and a delivery into lighters commenced to the purchaser.
After this, the company fearing that the master would charge
freight upon this damaged wheat, countermanded the original order
to sell, unless the master would relinquish it. This he declined to
do, but suggested to the agent the sale was a favorable one, and
that the question of freight might remain for after-consideration,
which was agreed to.
We think it quite clear that the counter order, not to sell,
came too late. The wheat had been turned over into the possession
of the agent, who had sold it, and a portion had been delivered
from the vessel to the purchaser. The agent had received complete
possession and control of the wheat, and thereby rescinded the
contract in the bill of lading for further shipment, and it
required the assent of both parties to revive it. This
counter-order, however, and the action under it, are significant of
the intent of the insurance company in accepting the delivery of
the wheat. It was to receive the possession in discharge of any
further responsibility of the vessel. The only thing in controversy
was the claim
Page 75 U. S. 161
of freight, and, undoubtedly, if the counter order had not been
too late, unless the master had consented to give up the freight,
he could have been compelled to forward the wheat as per bill of
lading, or be answerable for the refusal or neglect.
In cases where the disaster happens in consequence of one of the
perils within the exception in the bill of lading, or charter
party, the only responsibility of the vessel is to refit, and
forward the cargo, or the portion saved, or if that is
impracticable, to forward it in another vessel, and the owner is
then entitled to freight. If part of the cargo is so far damaged as
to be unfit to be carried on, the master may sell it at the
intermediate port, as the agent of the shipper, for whom it may
concern, and carry on the remainder. In this class of cases, the
vessel is only responsible for carrying on the cargo, being exempt
from any damage by the exception in the contract of affreightment.
And it is perfectly settled that if the shipper voluntarily accepts
the goods at the place of the disaster, or at any intermediate
port, such acceptance terminates the voyage and all responsibility
of the carrier, and the master is entitled to freight
pro rata
itineris. [
Footnote 1]
The same rule, as it respects the effect of the voluntary
acceptance of the goods at the place of the disaster, or
intermediate port, applies in case the ship is disabled or
prevented from forwarding them to the port of destination by a
peril or accident not within the exception in the bill of lading.
[
Footnote 2]
The only difference between the cases is, that inasmuch as, in
the latter, the vessel is responsible for all the damages that have
resulted from the misfortune to the cargo, the proofs of the
acceptance of the goods at the intermediate port, in order to
operate as a discharge of the vessel, should be clear and
satisfactory. The mere acceptance in such
Page 75 U. S. 162
cases, and nothing else passing between the parties, ought not
to preclude the shipper of his remedy. It should appear from the
evidence and circumstances attending the transaction that the
acceptance was intended as a discharge of the vessel and owner from
any further responsibility -- what would be equivalent to a mutual
arrangement, express or implied, by which the original contract in
the bill of lading was rescinded. The ground of the exemption from
responsibility of the vessel, in both cases, is the voluntary
acceptance of the goods at the intermediate port. Applying these
principles to the present case, we think the court can come to but
one result. It falls within the second class of cases above
referred to, as the explosion of the boiler was not a peril within
the exception in the bill of lading. [
Footnote 3]
The acceptance, as we have already seen, was the voluntary act
of the insurance company, without any solicitation or interference
on the part of the master, and what would seem conclusive of the
intent of the company in the transaction is, that they refused to
bring a suit against the carrier to recover for the damaged wheat,
although urged to it by the parties who afterwards took an
assignment of the subject of litigation. Some $2,300 was paid for a
claim which, if real and substantial, amounted to $20,000.
What is still further evidence of the understanding of the
insurance company of the effect of the acceptance and sale is, that
they brought a suit to recover the value of the one thousand one
hundred bushels of sound wheat, in the Superior Court of Buffalo
alone; but even this was subsequently discontinued. The suit in the
present case has been instituted by a volunteer, on a speculation,
and we are not sorry that, upon the application of the principles
of law governing it, the experiment must fail.
As to the freight, the cases we have above referred to establish
that the master is entitled to freight
pro rata itineris
in all cases where there has been a voluntary acceptance of
Page 75 U. S. 163
the goods at the port of disaster. The rate is to be ascertained
by comparing the portion of the voyage performed with the entire
length of it. [
Footnote 4]
In the present case, the goods were carried something more than
half the distance, and upon the facts as admitted in the record,
the freight would exceed the value of the one thousand and one
hundred bushels of wheat at the port of delivery at the time it
arrived.
No balance is shown to be due to the libellant on the wheat. The
libel, therefore, was properly dismissed by the court below.
Decree affirmed.
[
Footnote 1]
Welsh v. Hicks, 6 Cowen 504; Abbott on Shipping
554-555, and note, 1 Parsons on Shipping 239, n. 2;
ib.,
273; Maude & Pollock, Law of Shipping, 239, 221.
[
Footnote 2]
Osgood v. Groning, 2 Campbell, 471;
Liddard v.
Lopes, 10 East 526;
The Newport, Swabia 335, 342;
Abbott on Shipping 452, 453-5;
Hadley v. Clarke, 8 Term
259;
Spence v. Chodwick, 10 Q.B. 517.
[
Footnote 3]
Bukley v. Naumkeage Steam
Cotton Company, 24 How. 386;
S.C., 1
Clifford 322-324; 1 Sprague 477.
[
Footnote 4]
1 Kent's Commentaries 230.
