The Oceanica

• Decision Date: 16 February 1909
• Docket Number: 25.
• Parties: THE OCEANICA.
• Court: U.S. Court of Appeals — Second Circuit

170 F. 893

THE OCEANICA.

No. 25.

United States Court of Appeals, Second Circuit.

February 16, 1909

On Rehearing May 19, 1909.

Thomas C. Burke (Crangle & Burke, of counsel), for appellant.

George Clinton and Harvey L. Brown (Clinton & Clinton and Brown, Ely & Richards, of counsel), for appellant.

Before LACOMBE, COXE, and WARD, Circuit Judges.

WARD Circuit Judge.

In this case the steamship Oceanica, laden with iron ore, and the barge Massasoit, laden with lumber, both bound for Tonawanda N.Y., were lying at Presque Isle, about three miles above Marquette. The Oceanica was owned by the Tonawanda Iron &amp Steel Company and the Massasoit by John J. Boland and Charles Keenan. Mills, who was the Tonawanda Company's vessel manager, made a contract over the telephone with Boland, who was the managing owner of the Massasoit, that the Oceanica should tow the Massasoit from Marquette to Buffalo, the tow to assume all risks. We find this to be the contract, because Mills so testifies, and because the day after it was made he so stated in a letter to Boland, requesting a reply if there was any difference of understanding, and no reply was sent, and, finally, because Boland, though a witness at the trial, did not contradict Mills' testimony as to the contract. The tug did not drop the tow at Buffalo, but continued on with her towards Tonawanda. On the way down the Niagara river the tug broke her propeller and cut her line to the tow, which was carried by the current against the intake pier and became a total loss.

We are confronted at the outset of the case with the preliminary question whether the agreement made released the tug and her owners from liability for the loss of the tow, even if it was due to the negligence of those in charge of the tug. In this state a common carrier may contract against his own negligence; but such a contract will not be construed to cover the carrier's negligence, unless intention to do so is expressly stated. The reason is that, the stipulation having something besides negligence to apply to, viz., the carrier's liability as insurer, it will not be supposed that the parties intended to cover the carrier's liability for his own negligence, unless that is expressly, or by necessary inference, included. Canfield v. B. & O.R.R. Co., 93 N.Y. 532, 45 Am.Rep. 268; Kenney v. N.Y.C. & H.R.R.R. Co., 125 N.Y. 422, 26 N.E. 626. In England, where a carrier may contract against his own negligence, the law is the same. Beven on Negligence (2d Ed.) p. 1128. The same rule was laid down by the Supreme Court of the United States, before it had decided in Railroad Co. v. Lockwood, 17 Wall. 357, 21 L.Ed. 627, on grounds of public policy, that a common carrier could not contract against liability for his own negligence. New Jersey Steam Navigation Co. v. Merchants' Bank, 6 How. 344, 12 L.Ed. 465.

A tug is not, in relation to its tow, a common carrier, being only bound to the exercise of ordinary care. The Margaret, 94 U.S. 495, 24 L.Ed. 146. It follows that a contract against liability for negligence cannot be construed in the case of a tug as it may be in the case of a common carrier. The tug being only liable for negligence, if the tow agrees to assume all risks, no risks can be meant except those for which the tug is liable, viz., the consequences of her own negligence. There is no other class of risks upon which the clause can operate as in the case of common carriers, viz., those arising from liability as insurer. Unless construed to cover the tug's negligence, the stipulation is meaningless; i.e., an agreement by the tow to assume risks to which she is subject without any stipulation and for which there is no liability at all on the part of the tug. Still, in the case of The Syracuse, 12 Wall. 167, 20 L.Ed. 382, decided before the cases of The Margaret, supra, and Railroad Co. v. Lockwood, supra, had set at rest all question as to the extent of the tug's liability to her tow and as to the right of a common carrier to contract against the consequence of his own negligence Justice Davis said:

'It is unnecessary to consider the evidence relating to the alleged contract of towage, because, if it be true, as the appellant says, that by special agreement the canal boat was being towed at her own risk, nevertheless the steamer is liable, if through negligence of those in charge of her the canal boat has suffered loss. Although the policy of the law has not imposed on the towing boat the obligation resting on a common carrier, it does require on the part of the persons engaged in her management the exercise of reasonable care, caution, and maritime skill, and if those are neglected, and disaster occurs, the towing boat must be visited with the consequences.'

The learned judge must have meant that an agreement by the tow to tow at her own risk should not be construed to cover the tug's negligence. This was the view of Judge Nelson in the court below (The Syracuse, 6 Blatchf. 2, Fed. Cas. No. 13,717), who began his opinion with these words:

'One ground of defense set up is that by the contract of towage it was agreed that the canal boat was to be towed by the steamer at her own risk. The answer to this is that this contract does not exempt the steamboat from liability for damages caused to the canal boat by the negligence of those in charge of the steamboat.'

The evidence in that case as to the agreement was that the exemption appeared on a printed receipt for towage, which was signed after the boat had been taken in tow and the tow had started and the towage had been paid. Obviously such a provision could not under those circumstances have been held a contract binding upon the tow. Still it must be admitted that the learned judge was speaking of a special agreement entered into between the tug and the tow that the latter should be towed at her own risk. The Syracuse has never been cited on this point in any subsequent case in the Supreme Court arising out of a towage contract; but it has been followed in the lower courts in the following cases: Deems v. Albany & Canal Line, 14 Blatchf. 474, Fed. Cas. No. 3,736; The M. J. Cummings (D.C.) 18 F. 178; The Rescue (D.C.) 24 F. 190; The American Eagle (D.C.) 54 F. 1010; The Jonty Jenks (D.C.) 54 F. 1021; In re Moran (D.C.) 120 F. 556; The Somers N. Smith (D.C.) 120 F. 569; Alaska Commercial Co. v. Williams, 128 F. 362, 63 C.C.A. 92.

Such contracts in other relations than that of tug and tow have been held to cover negligence. The Fri, 154 F. 333, 83 C.C.A. 205; McCormick v. Shippy (D.C.) 119 F. 226, 230; Id., 124 F. 48, 59 C.C.A. 568; Chicago, Milwaukee & St. Paul Railway Co. v. Wallace, 66 F. 506, 14 C.C.A. 257, 30 L.R.A. 161; Long v. Lehigh Valley R.R. Co., 130 F. 870, 873, 65 C.C.A. 354; Bates v. R.R. Co., 147 Mass. 255, 17 N.E. 633; Hosmer v. R.R. Co., 156 Mass. 506, 31 N.E. 652. And we see no reason why they should be differently construed between tug and tow. This conclusion renders consideration of the other questions involved in the case unnecessary.

Decree reversed, but, in view of the authorities to the contrary, without costs.

On Rehearing.

WARD Circuit Judge.

The libelants contend in the first place that, as the court has found the towage contract made between the owners of the steamer Oceanica and the barge Massasoit to have been from Marquette to Buffalo, its terms cannot be held to apply to the subsequent towage from Buffalo to Tonawanda. Therefore it is argued that the agreement of the owner of the barge to assume all risks did not apply to the stranding of the barge in the Niagara river. We think this view erroneous. If the master of the Oceanica to oblige the master of the barge towed the barge beyond Buffalo against his owners' orders, then neither the Oceanica nor her owners are liable because the owners of the barge knew that the contract was to tow simply to Buffalo. The R. F. Cahill, 9 Ben. 352, Fed. Cas. No. 11,735; The Andrew White (D.C.) 108 F. 685. On the other hand, if the towage beyond Buffalo was within the authority of the master of the Oceanica, and not contrary to his owners' orders, then the contract must be regarded as extended and applying in all its terms to towage beyond Buffalo.

In the next place the petitioners contend that, the ownership of the cargo being different from the ownership of the barge, the cargo owners have a right to recover, even if the barge owners have not. No difference between the rights of the cargo and of the barge were pointed out either in the pleadings, in the proofs, in the printed briefs, or on the oral argument. It is now, however, admitted by the claimants of the Oceanica that the cargo was owned by third parties, and the question, therefore, arises whether their rights against the Oceanica differ from the rights of the owners of the barge.

The claimant of the Oceanica contends that the cargo owners must claim through, and are therefore bound by, the towage contract. New Jersey Steam Navigation Co. v Merchants' Bank, 6 How. 344, 381, 12 L.Ed. 465; Stoddard v. Long Island R.R. co., 5 Sandf. (N.Y.) 180, 188. When the towage contract was made, the owners of the barge were bailees of the cargo, and under the right and duty of representing it in matters necessary to transportation. The contract was certainly to tow the barge and her cargo. If it had contained no exemption, the owners of the barge could have recovered against the Oceanica for damage to both barge and cargo. So if the owners of the Oceanica had refused to perform the towage, and damage had thereby ensued, the contract could have been enforced for the benefit of the cargo as well as of the barge. We think that the cargo owners are not strangers to the contract, and that for the reasons next to be considered the contract is a...